Major International Business Headlines Brief::: 14 January 2019

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Major International Business Headlines Brief::: 14 January 2019

 


 

 


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*  Zimbabwe plans new currency as dollar shortage bites - finance minister

*  South Africa's ANC says central bank should broaden economic focus

*  W.Africa currency bloc members aim to issue $4.82 bln in debt in 2019

*  India's Bharti Airtel to give Tanzania bigger stake in local telecoms
firm - presidency

*  Stakeholder denies that Togo's Ecobank faces Nigerian investigation

*  South African rand little changed, stocks follow EM peers higher

*  South Africa's Reserve Bank seen on hold on Jan 17, hike in May

*  Kenya 2019/20 budget deficit forecast to fall, overall spending to rise -
finance ministry

*  Hitachi to decide on fate of UK nuclear plant

*  Airlander 10: World's longest aircraft gets full-production go-ahead

*  US partial government shutdown becomes longest ever

*  Guardian switches to potato starch wrapping

*  Ford: Almost 1,000 Bridgend job losses by 2021 outlined to unions

*  China powers up electric car market

 

 


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Zimbabwe plans new currency as dollar shortage bites - finance minister

HARARE (Reuters) - Zimbabwe will introduce a new currency in the next 12
months, the finance minister said, as a shortage of U.S. dollars has plunged
the financial system into disarray and forced businesses to close.

 

In the past two months, the southern African nation has suffered acute
shortages of imported goods, including fuel whose price was increased by 150
percent on Saturday.

 

Zimbabwe abandoned its own currency in 2009 after it was wrecked by
hyperinflation and adopted the greenback and other currencies, such as
sterling and the South African rand.

 

But there is not enough hard currency in the country to back up the $10
billion of electronic funds trapped in local bank accounts, prompting
demands from businesses and civil servants for cash which can be deposited
and used to make payments.

 

Finance Minister Mthuli Ncube told a townhall meeting on Friday a new local
currency would be introduced in less than 12 months.

 

“On the issue of raising enough foreign currency to introduce the new
currency, we are on our way already, give us months, not years,” he said.

 

Zimbabwe’s foreign reserves now provide less than two weeks cover for
imports, central bank data show. The government has previously said it would
only consider launching a new currency if it had at least six months of
reserves.

 

Locals are haunted by memories of the Zimbabwean dollar, which became
worthless as inflation spiralled to reach 500 billion percent in 2008, the
highest rate in the world for a country not at war, wiping out pensions and
savings.

 

A surrogate bond note currency introduced in 2016 to stem dollar shortages
has also collapsed in value.

 

President Emmerson Mnangagwa is under pressure to revive the economy but
dollar shortages are undermining efforts to win back foreign investors
sidelined under his predecessor Robert Mugabe.

 

Mnangagwa told reporters on Saturday that the price of petrol had increased
to $3.31 per litre from $1.32 from midnight but there would be no increase
for foreign embassies and tourists paying in cash U.S. dollars.

 

Locals can pay via local debit cards, mobile phone payments and a surrogate
bond note currency.

 

With less than $400 million in actual cash in Zimbabwe according to central
bank figures, fuel shortages have worsened and companies are struggling to
import raw materials and equipment, forcing them to buy greenback notes on
the black market at a premium of up to 370 percent.

 

The Confederation of Zimbabwe Industries has warned some of its members
could stop operating at the end of the month due to the dollar crunch.

 

Cooking oil and soap maker Olivine Industries said on Saturday it had
suspended production and put workers on indefinite leave because it owed
foreign suppliers $11 million.

 

A local associate of global brewing giant Anheuser-Busch Inbev said this
week it would invest more than $120 million of dividends and fees trapped in
Zimbabwe into the central bank’s savings bonds.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


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South Africa's ANC says central bank should broaden economic focus

DURBAN/JOHANNESBURG (Reuters) - South Africa’s ruling party said on Saturday
the central bank should broaden its focus to include boosting employment and
economic growth, a move that will worry investors already concerned about
the direction of economic policy.

 

The African National Congress (ANC), which has governed South Africa since
the end of apartheid in 1994 but has seen its majority wane, is trying to
woo voters in the lead-up to a parliamentary election expected to take place
in May.

 

The party led by President Cyril Ramaphosa wants to counter growing support
for the radical leftist Economic Freedom Fighters, which wants the
government to have a greater say in how the South African Reserve Bank
(SARB) is managed.

 

The SARB’s mandate now focuses on price stability, but the ANC said in its
2019 election manifesto released on Saturday that monetary policy should
also “take into account other objectives such as employment creation and
economic growth”.

 

Past attempts to alter the SARB’s mandate have caused the rand to weaken.
The economy has only recently climbed out of recession triggered in part by
investor worries about policies such as the ANC’s plans to make the SARB
fully state-owned and allow land expropriation without compensation.

 

“The ANC believes the South African Reserve Bank must pursue a flexible
monetary policy regime, aligned with the objectives of the second phase of
transition,” the manifesto said, promising renewed efforts to tackle
unemployment and racial inequalities.

 

Enoch Godongwana, the chairman of the ANC’s economic transformation
committee, denied that the ANC was preparing to change the mandate of the
SARB.

 

He told Reuters the manifesto merely reflected an intention for more
coordination between monetary and fiscal authorities, adding “the
independence of the Reserve Bank is sacrosanct”.

 

The central bank guards its independence and has opposed attempts to alter
its mandate, which is enshrined in the constitution. The bank did not
respond to a request for comment.

 

ANC DIVISIONS

The ANC is divided into two broad factions with divergent views on how the
economy should be managed. One supports Ramaphosa’s drive to boost private
investment, while another loyal to his predecessor Jacob Zuma backs a strong
state role.

 

Towards the end of Zuma’s nine years in power, South Africa’s anti-graft
watchdog tried unsuccessfully to make the central bank promote economic
growth rather than price stability.

 

In September, the ANC hastily retracted a statement calling on the SARB to
do more to help the poor after an intervention by Godongwana, a member of
Ramaphosa’s faction.

 

Peter Attard Montalto, head of capital markets research at Intellidex, said
the manifesto comments were a concern although he did not expect the SARB’s
mandate to change in the short term.

 

“The fact the manifesto specifically links the monetary policy committee’s
actions to the ‘second phase of transition’ is an explicit benchmarking of
monetary policy against political aims,” he said.

 

“It sets the SARB up for criticism in future as counter-revolutionaries and
can further fuel the nationalisation debate,” he added.

 

 

 

W.Africa currency bloc members aim to issue $4.82 bln in debt in 2019

ABIDJAN (Reuters) - The eight countries of the West African CFA franc zone
plan to issue 2.723 trillion CFA francs ($4.82 billion) in debt in 2019,
compared to 2.433 trillion CFA francs in 2018, an official from the regional
monetary union’s regulator said on Friday.

 

The total for 2018 was less than the 3.007 trillion CFA francs originally
forecast, mostly because of lower than expected debt issuances by Ivory
Coast and Mali, said Oulimata Ndiaye, issues operations manager of
UMOA-Titres.

 

The eight-nation Economic and Monetary Union of West Africa (UEMOA)
comprises Benin, Burkina Faso, Ivory Coast, Mali, Guinea-Bissau, Senegal,
Niger and Togo. They share a regional central bank, the BCEAO, and the CFA
franc currency, which is pegged to the euro.

 

($1 = 565.450 CFA francs)

 

 

 

India's Bharti Airtel to give Tanzania bigger stake in local telecoms firm -
presidency

DAR ES SALAAM (Reuters) - India’s Bharti Airtel has agreed to give part of
its stake in Airtel Tanzania to the government, raising the East African
nation’s holding in the mobile phone operator to 49 percent from 40 percent,
the president’s office said on Friday.

 

The announcement followed talks in Dar es Salaam between President John
Magufuli and Bharti Airtel Chairman Sunil Mittal to resolve a dispute over
ownership of the Tanzanian mobile operator.

 

Bharti Airtel would retain a 51 percent stake in the company, the
president’s office said, without giving a value for shares being transferred
to the government.

 

Airtel Tanzania had no immediate comment on the announcement.

 

Magufuli had said in 2017 that state-run Tanzania Telecommunications Company
Ltd (TTCL) owned the local subsidiary of Bharti Airtel outright but had been
cheated out of shares.

 

Bharti Airtel had disputed this, saying it received all the required
approvals from the state when it bought a 60 percent stake and had complied
with all government rules.

 

Magufuli said in Friday’s statement that, in addition to giving the
government more shares, Bharti Airtel had agreed to pay dividends to the
state.

 

“It’s great that they have agreed to give dividends to the government, which
for eight to 10 years we had not received. The percentage of dividends is
still under discussion,” the president said.

 

Magufuli’s ownership claim over the Tanzanian mobile firm had rattled
foreign investors, who were already unnerved by his government’s crackdown
on mining firms operating in the East African nation.

 

Other Mobile phone operators in Tanzania include Vodacom Tanzania, part of
South Africa’s Vodacom, Tigo Tanzania, which is part of Sweden’s Millicom
and Halotel, owned by Vietnam-based telecoms operator Viettel.

 

In 2016, the president ordered telecoms companies to list at least a quarter
of their units on Tanzania’s stock exchange to increase domestic ownership.

 

 

Stakeholder denies that Togo's Ecobank faces Nigerian investigation

JOHANNESBURG (Reuters) - Ecobank is not under investigation in Nigeria, the
chief operating officer of South Africa’s Nedbank, which owns 21 percent of
the Togo-baed lender, said on Friday.

 

A newspaper report that Nedbank’s West African associate was subject to an
investigation by Nigeria’s accountancy regulator spooked investors sensitive
to any prospect of costly fines in the country, driving down Nedbank’s share
price by more than 4 percent.

 

At the time of the report last month, both Ecobank and Nedbank said they had
not been notified of any inquiry. On Friday Nedbank COO Mfundo Nkuhlu said
Ecobank’s discussions with the regulator since then suggested there is no
investigation.

 

“[Ecobank Transnational Incorporated] management have advised, based on
their interaction with the Financial Reporting Council of Nigeria, there is
no investigation under way into the previous reporting of ETI’s annual
financial statements,” he said in an emailed statement.

 

The newspaper report said the investigation related to allegations that
Ecobank had overstated its balance sheet and income statement by applying
incorrect exchange rates.

 

Nedbank’s relationship with Ecobank is only now starting to pay off after a
slide in commodity prices and unfavourable currency swings in Nigeria drove
Ecobank to a $131.3 million pretax loss in 2016.

 

The market is particularly sensitive to news of Nigerian corporate
investigations after the MTN saga, in which the South African telecoms giant
had been threatened with a multibillion-dollar fine by Nigerian regulators.

 

Nigeria’s Financial Reporting Council could not be reached by telephone on
Friday. A representative previously told Reuters that the council did not
discuss its investigations.

 

 

 

South African rand little changed, stocks follow EM peers higher

JOHANNESBURG (Reuters) - The South African rand barely moved in afternoon
deals on Friday, giving up earlier gains stemming from dovish comments by
the U.S. Federal Reserve chief.

 

In the absence of major domestic drivers and with local market activity thin
this week, the rand has taken its cue from global drivers. At 1517 GMT, it
was 0.05 percent weaker against the dollar at 13.8650.

 

Analysts at Nedbank CIB said technical factors pointed to the rand staying
strong, with potential target levels of 13.53 and 13.38 against the dollar
on the back of healthy appetite for emerging markets (EM).

 

Federal Reserve Chairman Jerome Powell stressed again on Thursday the U.S.
central bank could be patient in approving further interest rate increases,
cementing market expectations the pace of monetary tightening will slow.
[nL1N1ZA2CM]

 

The rand and other EM currencies were battered in 2018 by four Fed rate
hikes which boosted the dollar and dented appetite for riskier assets. The
dollar was down 0.3 percent against a basket of major currencies on Friday
after Powell’s latest cautious remarks.

 

On the bourse, stocks gained, tracking an upbeat tone in other emerging
markets as hopes of a U.S.-China trade deal lifted sentiment.

 

The blue-chip Top-40 index was up 0.69 percent at 47,491 and the broader
All-share index rose 0.76 percent to 53,676.

 

In fixed income, the benchmark 2026 government bond also firmed, as the
yield fell 0.5 basis points.

 

 

 

South Africa's Reserve Bank seen on hold on Jan 17, hike in May

JOHANNESBURG (Reuters) - South Africa’s Reserve Bank will leave interest
rates at 6.75 percent on Jan. 17, all 27 economists polled by Reuters in the
past four days said, but rising inflation means it is likely to hike them in
May.

 

May’s expected hike to 7.00 percent would follow a surprise increase by the
bank two months ago and is despite expectations for the price of crude to
fall, offering much needed relief to net oil importers such as South Africa.

 

The central bank wants inflation between 3 and 6 percent and while the
median 2019 forecast got a slight nudge down to 5.2 percent in the latest
poll, quarterly predictions say it will rise further from the mid-point
through this year.

 

“Inflation will still be above the midpoint of the target, if it thought
inflation was worrying to hike in November, then I think the same argument
will apply in the first part of this year,” said John Ashbourne, senior
emerging markets economist at Capital Economics.

 

But weak growth, expected to average 1.5 percent this year, means rates are
expected to remain at 7.0 percent until the dying months of next year when
the bank will add an additional 25 basis points. Growth is forecast to
accelerate to 1.9 percent in 2020.

 

With global growth weakening, some economists expect no change in South
African policy across the forecast horizon. Frank Blackmore of EFConsult is
one of those, citing lower global growth expectations and weaker domestic
inflation.

 

The U.S. Federal Reserve has been raising rates but has signalled fewer
interest rate hikes over the next two years and expressed caution about the
U.S. economic outlook.

 

Higher rates in richer nations tend to attract much needed capital inflows
away from emerging markets such as South Africa, weakening currencies which
leads to quicker domestic inflation.

 

However, a separate Reuters poll on Wednesday said the rand would lose over
3 percent of its value in volatile trade against the dollar this year, but
should be cushioned by wavering expectations for U.S. interest rates.

 

 

Kenya 2019/20 budget deficit forecast to fall, overall spending to rise -
finance ministry

NAIROBI (Reuters) - Kenya’s budget deficit is forecast to fall in the
2019/20 fiscal year, while overall spending will rise, the Finance Ministry
said on Friday.

 

In a draft budget policy statement, the ministry said the budget deficit
would drop to 5.0 percent of gross domestic product in the period from July
to June, from a revised deficit of 6.3 pct of GDP in the 2018/19 fiscal
year.

 

The deficit was forecast to fall further to 3.0 percent of GDP in 2022/23.

 

The policy statement said overall spending would rise to 2.70 trillion
shillings ($26.56 billion) in 2019/20 from a revised 2.51 trillion shillings
in the previous fiscal year.

 

To cover the deficit, the government will borrow 271.4 billion shillings
from the domestic market in 2019/20 and 306.5 billion shillings from foreign
sources, the ministry said.

 

The East African nation’s government increased borrowing and spending
recently, leaving it with a fiscal deficit that peaked at 6.8 percent in the
fiscal year ending in June, 2018.

 

In October, the International Monetary Fund said Kenya’s risk of defaulting
on debt repayments had increased to moderate from low, citing the
government’s public investment drive and revenue shortfalls in recent years.

 

($1 = 101.6500 Kenyan shillings)

 

 

Hitachi to decide on fate of UK nuclear plant

The UK government's nuclear policy is under renewed scrutiny as the firm
behind a £20bn reactor in Wales looks set to halt construction.

 

Japanese media reports say Hitachi will suspend on its Horizon division's
Wylfa Newydd plant this week.

 

The company says no formal decision has yet been made.

 

But if the project is scrapped, it will cost 400 jobs and leave the Hinkley
Point power station in Somerset as the only new UK reactor still being
built.

 

In November, plans to build a nuclear power station at Moorside in Cumbria
were halted after Toshiba announced it was winding up its NuGeneration
subsidiary, which was behind the project.

 

The government continues to stress that it is still in talks with Hitachi
about Wylfa.

 

A spokesperson for the Department for Business, Energy and Industrial
Strategy (BEIS) said: "Negotiations with Hitachi on agreeing a deal that
provides value for money for consumers and taxpayers on the Wylfa project
are ongoing.

 

"They are commercially sensitive and we do not comment on speculation."

 

What's Wylfa - and why is it so important?

Wylfa nuclear axe reports 'worrying'

Wylfa Newydd future doubt 'speculation'

'Wylfa jobs could drain away to England'

The latest developments are likely to force the government to sweeten future
nuclear plant deals for potential investors, in what one expert has called a
"desperate leap in the dark".

 

Energy Secretary Greg Clark has already suggested that regulated asset base
(RAB) funding could be used for nuclear projects in future.

 

The method, which has already been used for other infrastructure schemes
including the £4.2bn Thames Tideway "super-sewer", allows investors to
receive returns before the projects have been completed.

 

It also allows the Treasury to keep the costs off its books by recouping the
investment from consumers' bills rather than through direct taxation.

 

A BEIS spokesperson said on Sunday that it remained the government's
objective in the longer term that new nuclear projects like other energy
infrastructure should be financed by the private sector.

 

The spokesperson added: "Alongside our discussions with developers, we will
be reviewing the viability of a regulated asset base model as a sustainable
funding model based on private finance for future projects beyond Wylfa,
which could deliver the government's objectives in terms of value for money,
fiscal responsibility and decarbonisation."

 

Technically complex

One economist, Prof Dieter Helm of Oxford University, says this could work
if it is properly regulated.

 

In an analysis of the model, he wrote: "The RAB approach is in a first, best
world probably inferior to the direct procurement route, but the latter is
ruled out by the Treasury-imposed constraints.

 

"The RAB model is a second-best, but much better than the Hinkley-style
contract."

 

However, energy expert Prof Paul Dorfman, of the Energy Institute at
University College London, is more sceptical.

 

He told the BBC that nuclear power plants could not be built without "vast"
public subsidies and that RAB funding was merely "a fiscally dextrous form
of subsidy".

 

He added: "It's never been tried for projects as technically complex as
nuclear power that take about a decade to build.

 

"It really looks as if the government are flailing. It's a last desperate
leap in the dark."

 

Both Prof Helm and Prof Dorfman take the view that the UK has various
possible ways of satisfying its future energy needs.

 

Prof Helm says that nuclear faces "deep challenges", adding: "It is for
society to decide whether it wants new nuclear or not. The market cannot
decide."

 

For Prof Dorfman, renewable energy is now "cost-competitive with fossil
fuels" and offers "a cheaper and better way forward".--BBC

 

 

 

Airlander 10: World's longest aircraft gets full-production go-ahead

The world's longest aircraft is set to go into full production with the
model designed to take its first passengers.

 

It comes after the prototype £32m Airlander 10 - a combined plane and
airship - was formally retired following successful final testing.

 

As a result, Bedford firm Hybrid Air Vehicles (HAV) has been given
Production Organisation Approval from the Civil Aviation Authority (CAA).

 

Airlander 10 hit the headlines in 2017, when the prototype collapsed.

 

An eyewitness said the aircraft appeared to "break in two" after breaking
its moorings and deflating, in November that year, less than 24 hours after
completing its sixth successful test flight.

 

The firm was given Design Organisation Approval from the European Aviation
Safety Agency (Easa) in October.

 

Stephen McGlennan, HAV's chief executive, said 2018 had been very good, with
Easa's backing a "huge highlight".

 

He said the firm had changed its focus last year towards the production of
Airlander 10 as a commercial aircraft for customers.

 

"The prototype served its purpose as the world's first full-sized hybrid
aircraft, providing us with the data we needed to move forward from
prototype to production standard," he said.

 

It is now hoped the full commercial model will take to the skies with its
first paying passengers "in the early 2020s".

 

HAV submitted a £32m insurance claim after the prototype crash, telling its
shareholders this was the "maximum insured value".

 

Approval from the CAA and Easa now puts the firm in a "strong position to
launch production".

 

HAV carried out its first test flight of Airlander 10 from its former home
at Cardington Airfield in August 2016 but left the site in June last year.

 

In July, it revealed it planned to offer "luxury expeditions" once all tests
were successfully completed.

 

CORRECTION: This article has been revised to make it clear the prototype of
Airlander 10 has been withdrawn after successfully completing final testing.
It also clarifies that Hybrid Air Vehicles has been given the required
certification from all air authorities to begin full commercial production
of its aircraft.--BBC

 

 

 

US partial government shutdown becomes longest ever

The partial shutdown of the US government has become the longest ever, with
no end in sight to the political standoff.

 

On Saturday it reaches its 22nd day, overtaking the previous record - the
21-day shutdown in 1995-96 under then-President Bill Clinton.

 

President Donald Trump is refusing to approve a budget unless it includes
funds for a wall on the Mexican border.

 

Democrats have rejected his request for $5.7bn (£4.5bn).

 

About a quarter of the federal government is still out of operation until a
spending plan is agreed, leaving 800,000 employees unpaid.

 

On Friday, those workers - including prison guards, airport staff and FBI
agents - missed their first salaries of the year.

 

 

Meanwhile, President Trump has calmed speculation that he is about to
declare a national emergency in order to bypass Congress and get the money
he needs. His proposed border wall was a key election pledge.

 

He described an emergency declaration as an "easy way out" and said he would
prefer Congress to resolve the problem.

 

How much has shutdown hit US economy?

But he added: "If they can't do it... I will declare a national emergency. I
have the absolute right."

 

Correspondents say Democrats would mount an immediate legal challenge if Mr
Trump made such a move.

 

How have workers reacted?

On Friday, some workers who missed their first payday of the year shared
their blank payslips on social media.

 

Oscar Murillo, an aerospace engineer at Nasa, posted his $0 cheque on
Twitter and said he had actually lost money because of mandatory deductions.

 

Another Twitter user, Cat Heifner, shared what she said was her brother's
payslip, showing he had been paid one cent for his work as an air traffic
controller.

 

A food bank in Washington DC is arranging five pop-up markets on Saturday
for unpaid federal workers.

 

Radha Muthiah, head of Capital Area Food Bank, said dozens of volunteers
were working to pack bags of food for affected staff.

 

Meanwhile, the classified advertising website Craigslist has been inundated
with listings from government employees trying to sell their possessions.

 

Items ranging from beds to old toys have been listed as "government shutdown
specials".

 

"Sells for $93.88 at Walmart. Asking $10," one advert for a child's rocking
chair reads. "We need money to pay bills."

 

Of the 800,000 federal employees going unpaid, about 350,000 are furloughed
- a kind of temporary lay-off - while the rest are continuing to work.

 

Thousands have reportedly applied for unemployment benefits amid the
financial uncertainty.

 

One major airport, Miami International, will close an entire terminal this
weekend because of a shortage of security agents caused by the shutdown.

 

The agents are "essential" federal workers and expected to work - despite
not being paid until the shutdown ends.

 

Instead many agents are calling in sick in protest at the situation, the
Miami Herald reports.

 

What is the political situation?

The House and Senate overwhelmingly passed a bill on Friday to ensure all
government workers receive retroactive pay after the shutdown ends. The
president is expected to sign the legislation.

 

But that may be small consolation to those federal employees currently in
dire straits, with no end in sight to the impasse.

 

At a roundtable discussion about border security on Friday with state and
local leaders, Mr Trump again demanded that Democrats approve funding for a
wall or steel barrier.

 

How much of Trump's wall has been built?

What border politicians think of Trump's wall

However, the Democratic leader of the US House of Representatives said the
ball was in Mr Trump's court.

 

Speaker Nancy Pelosi told reporters: "When the president acts, we will
respond to whatever he does."

 

According to the Associated Press, senior White House aide Jared Kushner -
Mr Trump's son-in-law - is among those who have cautioned the president
against declaring a national emergency.

 

US media report the White House is considering diverting some of the $13.9bn
allocated last year by Congress for disaster relief in such areas as Puerto
Rico, Texas and California to pay for the wall.

 

But Republican congressman Mark Meadows, who is close to the president, said
that option was not under serious consideration.--BBC

 

 

 

 

Guardian switches to potato starch wrapping

Guardian readers have been opening their weekend paper to find supplements
wrapped in a compostable material made from potato starch.

 

The paper says it ditched its polythene covers after feedback from readers.

 

Advice on the wrapping says it should not be recycled but disposed of on a
compost heap or in a food waste bin.

 

The change, which the Guardian says will increase its production costs, has
been introduced in London, Kent, Essex, Hertfordshire, Norfolk and Suffolk.

 

It plans to phase in the new wrapping across the whole of the UK over the
coming months.

 

The packaging, produced by environmental manufacturer Ecover, has a silky
feel and is not entirely transparent like plastic.

 

The company has received the composting seal of approval from OK Compost
Home, which certifies products.

 

Recycled packaging 'may end up in landfill'

Why are 99.75% of coffee cups not recycled?

Why 12 is the magic number when it comes to composting

The Guardian said the wrap was suitable for domestic composting and designed
to "completely compost within six months in a well-maintained compost heap
or food waste bin".

 

Reaction on social media has been mainly positive, although some readers
were unsure whether their local authority would allow it in their food waste
bin and whether it would ever fully break down.

 

Our council won’t permit potato starch bags in green bins as they clog up
the mulching mechanisms. But since they biodegrade I guess they’re better in
the general waste bins than plastic bags

 

The Guardian said it would not reveal the extra cost involved in switching
to the packaging.

 

Other publications have already moved to potato starch wrapping, including
the New Internationalist and the National Trust members' magazine, but the
Guardian says it is the first national newspaper to do so.

 

What is potato starch packaging?

Usually comes from waste potatoes so you don't need to grow a crop to make
it

100% compostable

Contains no oil-based materials, plastics or harmful toxins

Durable

Carries the EN13432 industrial certification. OK compost HOME certification,
which the Guardian wrapper has, is the equivalent for domestic compost

Other national newspapers say they have been experimenting with more
environmentally-friendly ways to distribute their magazines, supplements and
advertising leaflets.

 

The Times said it was trialling biodegradable bags and "belly bands" - a
looped strip of paper - and hoped to roll out at least one of these options
"as soon as we can".

 

A spokesman for the Mail on Sunday said: "We are actively investigating an
alternative to polythene bags, in particular using a form of paper
packaging."

 

The FT said it removed all plastic packaging of home deliveries at the start
of the year - and papers sold in newsagents and supermarkets have always
been unwrapped.

 

The move at the Guardian coincides with a 30p price hike of the Saturday
edition to £3.20. The price of the weekday edition and the Observer are also
going up by 20p, to £2.20 and £3.20 respectively.--BBC

 

 

 

Ford: Almost 1,000 Bridgend job losses by 2021 outlined to unions

Ford wants to cut 370 workers at an engine plant in south Wales in the first
phase of almost 1,000 job losses, BBC Wales understands.

 

Unions have pledged to fight compulsory redundancies at the car giant's
plant in Bridgend after they were briefed by Ford management on Friday.

 

It is believed the first tranche of cuts would be offered as voluntary
redundancies.

 

Ford is looking to shake up its European operations.

 

It is nearly two years since fears of 1,160 job losses at the plant by 2021
emerged in a worse case scenario.

 

All aboard the walking car

Bridgend loses out in global race

Bridgend makes engines for Jaguar Land Rover (JLR) but that contract
finishes at the end of 2019, at around the same time the plant will stop
making the Ford Ecoboost engine

 

The factory, which employs about 1,700 workers, won the investment for
Ford's latest petrol engine - the Dragon - but that will only employ around
500.

 

If plans go ahead, the 990 jobs to be lost at Bridgend - almost half of the
site's workforce - will go in two phases by 2021, as part of 1,150 losses
across the UK.

 

Ford declined to confirm the figures and said it was currently consulting
with unions.

 

It said these talks were ahead of it implementing a "comprehensive
transformation strategy".

 

Jeff Beck, GMB organiser, said the union would "fight for every Ford job" in
Bridgend and across the UK.

 

"We have been asking the company for two years to clarify the situation
regarding jobs and it's not until today that we have had the devastating
answer.

 

"We have now been told 990 jobs will be cut in Bridgend by 2020. This is
devastating news for the dedicated workers at Ford and their families.

 

"Our members there have been extremely loyal to Ford, and we will stand by
them."

 

The Unite union called it "grim news" and said shop stewards had been given
a briefing.

 

"It is a devastating blow for our members and their families, as well as
having grave implications for the Welsh economy and the supply chain," said
officer Des Quinn.

 

"Unite is fully committed to opposing any compulsory redundancies and
campaigning strongly for Bridgend to have a viable future."

 

He said representatives would consult with members over the coming days.

 

"There are a number of factors behind this grim news - the main ones being
challenging market conditions for carmakers generally, a lack of a coherent
industrial strategy from the UK government and the uncertainty created by
Brexit.

 

"Over the last two decades the UK car industry has experienced a renaissance
of which we can all be proud of.

 

"The challenge for government, the carmakers and the unions in the near
future is to fight very hard to maintain the environment that made that
success possible."

 

 

We have already heard this week about Ford's review of its European
operations - as well as the cutbacks at Jaguar Land Rover.

 

But this news today is something that unions have feared for nearly two
years.

 

This is because it was widely known that Bridgend's contract to make engines
for JLR was coming to an end and that Ford's own plans for a new engine had
been scaled right back.

 

Ford have said discussions have only just started and details of numbers are
"premature".

 

But we understand that early talks are around a first tranche of job losses
involving voluntary redundancies.

 

Carwyn Jones, Labour Bridgend AM and former first minister, said he and
Labour colleague Huw Irranca-Davies would be working to ensure the plant's
future.

 

"It does reflect the uncertainty that all Ford workers face," he said.

 

"I spoke to Ford yesterday. They gave no indication of any particular threat
to Bridgend or any other plant for that matter, but they did say they were
rethinking the way Ford were operating in Europe," he added.

 

Plaid Cymru's Rhun ap Iorwerth called for an urgent economic summit to be
organised.

 

"These reports are devastating - both for the workers directly affected and
the wider Welsh economy," he said.

 

The 1,000 losses would come alongside 150 in Ford's transport operations,
which would affect lorry drivers.

 

On Thursday, the company said it would be speeding up plans to cut
structural costs and thousands of jobs would go across Europe.

 

"We are taking decisive action to transform the Ford business in Europe,"
said group vice president for Europe, Steven Armstrong.

 

"We will invest in the vehicles, services, segments and markets that best
support a long-term sustainably profitable business, creating value for all
our stakeholders and delivering emotive vehicles to our customers."

 

The announcement from Ford came on the same day as Jaguar Land Rover said it
was axing 4,500 jobs and Honda said it was halting production for six days
after Brexit.--BBC

 

 

China powers up electric car market

Outside China, few drivers have heard of brands such as Hit BYD or Beijing
Automobile Works. But they're two of the largest players in the world's
biggest market for electric cars.

 

For a decade, the Chinese government has coaxed buyers and manufacturers
into the electric vehicle market through subsidies and other incentives.

 

The numbers suggest the strategy worked: the International Energy Agency
says China buys more than half of the world's new electric cars.

 

Now, the government is set to push the burden onto manufacturers, through a
new "cap and trade" system and rules that make it harder to set up a factory
to make combustion-engine cars.

 

The rules were believed to have come into force on 1 January this year.

 

Small but growing rapidly

China is both the biggest manufacturer and the biggest market for cars
globally.

 

But after two decades of rapid expansion, sales fell in 2018 by 6% to 22.7
million units.

 

The most recent figures show that New Energy Vehicles (NEVs) - a category
which includes electric and hybrid models - has defied that trend, growing
substantially over the past year.

 

Nissan produces first electric cars for China

Electric vehicles move into the fast lane

However, the China Association of Automobile Manufacturers (CAAM) says
601,000 NEVs were sold in the first three quarters of 2018, which means they
still account only for a small fraction of the market.

 

How do the new rules work?

The National Reform and Development Commission has said it won't allow the
establishment of new companies that only make combustion-engine cars.

 

It has also imposed additional conditions for existing companies that plan
to set up a factory for cars that aren't NEVs.

 

New quotas on electric vehicles are also expected to have an impact on
manufacturers.

 

Under a new "cap and trade" system, any company that makes 30,000 cars or
more needs to earn enough credits to match 10% of its output.

 

So a car company manufacturing the minimum would need to earn 3,000 credits.

 

But not all cars are treated equally. A NEV can receive between two and six
credits depending on how far it can travel before being recharged.

 

So if a carmaker makes 30,000 cars, it could hit its quota by manufacturing
1,000 cars with three credits each.

 

Any company that doesn't reach its quota faces a fine, but carmakers that
expect to fall short can buy credits from manufacturers which have a
surplus.

 

This means carmakers who don't reach their quota directly subsidise
manufacturers who do.

 

Theresa May's push to green vehicles

Dyson gears up for electric car sharing

Uber drivers to charge electric car fee

Analysts say that could be very appealing to overseas manufacturers, which
currently make the most efficient NEVs.

 

"If Tesla starts manufacturing in China, they will get the highest credit.
If they sell a sufficient number of vehicles, they will be able to sell to
other [manufacturers] at a credit," according to Vivek Vaidya, from
consultancy Frost and Sullivan.

 

China at the forefront

China has been aggressively pursuing NEVs, both to cut air pollution and to
develop a strong industry.

 

The Chinese government has had subsidies in place for nearly a decade, and
these have been supplemented by subsidies from regional governments.

 

In some cities, public transport has also led the way.

 

Shenzhen's fleet of 16,000 buses is now 100% electric and its fleet of taxis
is almost completely electric too.

 

In addition to a robust local industry, many global manufacturers are
already in the Chinese NEV market, mostly through joint-venture
arrangements, including Nissan, Toyota, VW, BMW and Volvo.

 

GM says it's on track to deliver 10 NEV models by 2020 and plans to double
that number over the following three years.

 

Tesla has just broken ground on its gigafactory, just outside Shanghai.

 

An end to subsidies?

This latest move appears at least partly to be an attempt to wean the market
off subsidies.

 

"This law is really to help replace the subsidy the Chinese government
offers now on purchasing NEVs in China and pushes that responsibility onto
the car manufacturer," according to Tu Le, from research firm Sino Auto
Insights.

 

In Beijing and Shanghai, for example, drivers who buy an NEV are currently
given a license plate for free, while other drivers have to participate in a
lottery in Beijing or an auction in Shanghai.

 

In other Chinese cities, subsidies and rebates are given to buyers who
purchase NEVs.

 

Growing pains

There are a number of issues that could, at least in the short term, create
some difficulties.

 

There have already been reports that China's electric carmakers have taken
an initial hit on the stock market over fears about the removal of
subsidies.

 

Tu Le says a lack of electrification infrastructure could also weigh on
sales and the trade war could be a wild card.

 

"If the trade war is not resolved within the first quarter of 2019, then
this could have significant negative effects on the overall sales of cars
and customers' willingness to take a chance on new technologies," he said.

 

How will it affect the market for electric cars?

Vivek Vaidya expects the new plan to succeed, mostly because manufacturers
will have a strong incentive to make more electric and hybrid cars.

 

Electric powered Minis to be built in China

China to 'cut US car tariff'

He also thinks some Chinese market leaders could expand their reach beyond
the mainland. But unless you live in a developing market, it's not very
likely a Chinese electric vehicle will be driving down your street any time
soon.

 

"Chinese vehicles are very competitively priced, but it's not apple to apple
comparison. They might not dominate a market like Germany, but they might
target Asian markets like India and Indonesia," he said.-BBC

 

 

 

 


 

 


 

INVESTORS DIARY 2019

 


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