Major International Business Headlines Brief::: 24 January 2019

Thu Jan 24 07:56:15 CAT 2019

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Major International Business Headlines Brief::: 24 January 2019

 <http://www.nedbank.co.zw/> 

*  Zimbabwe vows bold economic turnaround despite surging prices

*  Kenya's finance ministry confirms it sought Eurobond proposals

*  Kenya to restrict second-hand imports to boost domestic car sector

*  South Africa's consumer inflation slows to 4.5 pct yr/yr in December

*  Foreign investors pulled $2.1 bln from Nigeria's stock market in 2018

*  South African rand recovers before inflation data

*  France's EDF buys 49 pct stake in Conergies Group

*  First Quantum Minerals scraps plan to cut jobs in Zambia

*  Poland's prime minister wants to see more workers return from UK

*  Microsoft's Bing search engine inaccessible in China

*  Barclays bosses 'paid Qatar secret fees'

*  Chinese censor calls Tencent news app 'vulgar'

*  DHL could profit from no-deal Brexit, says boss

 <mailto:info at bulls.co.zw> 

Zimbabwe vows bold economic turnaround despite surging prices

DAVOS, Switzerland (Reuters) - Zimbabwe’s finance minister painted an
optimistic outlook for his country on Tuesday, despite protests over fuel
prices that human rights groups say have left at least a dozen people dead.

Mthuli Ncube told Reuters that in the next year he hoped to bring inflation
under 10 percent from 42 percent now, find the money to cover debt payments
of $1.2 billion, and introduce a new currency.

He also talked up a privatisation programme that has so far seen little real
progress.

“Zimbabwe is the best buy in Africa right now,” he said in an interview at
the World Economic Forum in Davos.

Zimbabwe is facing its most serious economic crisis in a decade. Shortages
of food, fuel and foreign currency are testing the government of President
Emmerson Mnangagwa, who was voted into power after the overthrow of Robert
Mugabe in 2017.

The government recently raised the price of fuel, which sparked protests
across the country. Human rights groups say Zimbabwean security forces used
live ammunition to quell them.

Ncube, a former banker whose appointment last year was meant to signal a new
focus on the economy, said Mnangagwa had issued “a very clear statement to
say that violence is really not allowed, that violence is un-Zimbabwean on
both sides”.

He said any abuses by the security forces would be punished.

“It is precisely because of the opening up of the democratic space that this
(the protests) has happened,” he said.

“There is only one centre of power which is the president. Everyone is
behind him.”

Zimbabwe owes US$7.4 billion in external debt and needs to pay $1.2 billion
of that in 2019, most of it to the World Bank and the African Development
Bank. Ncube says he is speaking to G7 countries to find a way to make those
payments.

Neighbouring South Africa has recently raised the possibility of financial
aid for Zimbabwe. Ncube said he would welcome anything they could offer.

One of the country’s biggest problems is the dysfunctional currency market.
For the past few years Zimbabwe has used an electronic dollar that is
officially pegged one-to-one with the U.S. dollar. The black market rate is
around four-to-one.

Ncube wants to introduce a new domestic currency within a year. That
process, he said, might involve a change to the official rate because it was
impossible to completely deal with “the distortions that continue to
fester”.

Ncube said a trip that he and President Mnangagwa just took to Azerbaijan,
Belarus, Kazakhstan and Russia had provided ideas that Zimbabwe was keen to
copy, especially on managing natural resources and using the proceeds to
fund development.

“We were pleasantly impressed, very impressed, and anyone should be,” he
said. “If you go to Astana (the Kazakh capital) you will be just blown
away.”

 <mailto:info at bulls.co.zw> 

Kenya's finance ministry confirms it sought Eurobond proposals

NAIROBI (Reuters) - Kenya’s finance ministry has sought proposals from banks
and firms to provide lead manager services for the issuance of a new
Eurobond, it said on Wednesday, confirming an earlier source-based report by
Reuters.

Proceeds from the Eurobond sale, whose amount will be determined at a later
date, will be used to fund the 2018/19 (July-June) budget deficit, the
ministry said in a response to questions by Reuters, without offering more
details.

Kenya to restrict second-hand imports to boost domestic car sector

NAIROBI (Reuters) - Kenya plans to restrict imports of second-hand cars to
newer vehicles in an effort to boost the domestic automotive sector by
reducing the dominance of the used car market.

The East African nation undermined what was a thriving vehicle assembly
industry in the 1990s with policies that encouraged imports of cheap
second-hand cars.

The government now intends, by 2021, to restrict imports of cars to vehicles
that are three years old or newer, according to a draft policy proposal seen
by Reuters on Wednesday. Current regulations allow the importation of cars
up to eight years old.

Imported second-hand vehicles account for 85 percent of Kenyan car
purchases, amounting to 86,626 vehicles in 2017 and gobbling up precious
foreign exchange estimated at about 60 billion shillings ($593 million) a
year.

The target is to gradually but systematically reduce and replace the over 80
percent market share of used vehicles and used parts with new products
manufactured or assembled in Kenya, the government said in the policy draft.

French carmaker Peugeot SA closed its Kenyan assembly plant in 2002 but
resumed operations in 2017 for two of its models.

Peugeot’s move followed hot on the heels of Volkswagen’s (VOWG_p.DE) 2016
resumption of light assembly in Kenya after a four-decade absence.

Despite the return of Peugeot and VW, the market for new cars remains small,
with only 14,353 sold last year, according to the Kenya Vehicle
Manufacturers Association.

Last year’s new car sales were dominated by Isuzu East Africa and Toyota
East Africa, which accounted for more than half of the total.

Vehicles with an engine capacity of 1500 cubic centimetres and below will be
exempt from the new three-year age limit, the government said, to keep
certain models within the reach of first-time buyers unable to afford more.

Companies that assemble cars locally will also receive financial incentives,
including zero import and excise duties, as well as a 50 percent discount to
the corporate tax rate, the draft policy shows.

Industry executives welcomed the proposals.

“The policy is good. It will give investors in the auto sector an assurance
that their investments will be safe in the long run,” said Rita Kavashe,
head of Isuzu East Africa.

“Investors are going to take this market more seriously.”

($1 = 101.2500 Kenyan shillings)

South Africa's consumer inflation slows to 4.5 pct yr/yr in December

JOHANNESBURG (Reuters) - South Africa’s headline consumer inflation slowed
to 4.5 percent year on year in December from 5.2 percent in the previous
month, in line with expectations of economists polled by Reuters, data from
Statistics South Africa showed on Wednesday.

On a month-on-month basis, prices fell 0.2 percent in December from an
increase of 0.2 percent in the previous month.

Core inflation, which excludes the prices of food, non-alcoholic beverages,
petrol and energy, was unchanged at 4.4 percent year on year in December
from 4.4 percent in November.

On a month-on-month basis, core inflation was at 0.3 percent in December
from 0.2 percent in November.

Foreign investors pulled $2.1 bln from Nigeria's stock market in 2018

LAGOS (Reuters) - Foreign investors sold off Nigerian stocks valued at
642.65 billion naira ($2.1 bln) last year, stock exchange data showed, 48
percent more than in 2017 as worries over weak growth amidst lower oil
prices depressed sentiment.

Risk aversion triggered by interest rate rises in the United States reversed
capital flows to frontier markets including Nigeria, coupled with mounting
political risk in the run-up to elections next month, accelerated losses for
the stock market.

The exchange put the value of transactions by foreign investors at 1.219
trillion naira last year, compared with 1.208 trillion naira at the end of
2017.

Stock exchange CEO Oscar Onyema has said market sentiment in the first half
of 2019 would be driven by oil prices and election risk. But government
spending to boost recovery following a 2016 recession could lift stocks by
the second half.

The main index, which was flat on Tuesday, has fallen 2 percent so far this
year. It shed 17.81 percent in 2018 after a strong rally the previous year.

Foreign investors increased the pace of stock market outflows from May,
selling out of the relatively liquid banking, consumer and oil sectors as
the capital flight worsened, putting pressure on the local naira currency.

OPEC member Nigeria suffered severe dollar shortages after prices of crude,
its top export and main source of foreign exchange, plunged in late 2014,
prompting the introduction of capital controls in 2015.

It now has multiple exchange rates against the U.S. currency and has been
selling the dollar on the interbank market to boost liquidity after floating
the naira for investors.

South African rand recovers before inflation data

JOHANNESBURG (Reuters) - The South African rand recouped some of the
previous day’s losses early on Wednesday, before the release of inflation
data which is expected to show a significant slowdown in price rises for
consumer goods.

At 0711 GMT, the rand traded at 13.9325 versus the dollar, 0.2 percent
stronger than its previous close.

Among factors supporting the rand, China - a major South African trading
partner and the world’s second-largest economy - said it would step up
fiscal spending to support growth.

Statistics South Africa will release December consumer inflation data around
0800 GMT.

Inflation is expected to slow to 4.5 percent year on year from 5.2 percent
in the previous month, economists polled by Reuters predicted.

South Africa’s central bank referred to an improved near-term inflation
outlook at its latest monetary policy meeting this month, when it kept its
repo rate unchanged. The bank tries to keep inflation close to the midpoint
of its 3 percent to 6 percent target range.

Stocks opened slightly weaker, with the Johannesburg Stock Exchange’s
All-share index down 0.15 percent at 53,999 points. Government bonds also
dipped, as the yield on the benchmark 2026 instrument rose 1 basis point to
8.870 percent.

France's EDF buys 49 pct stake in Conergies Group

PARIS (Reuters) - French state-controlled power utility EDF has bought a 49
percent stake for an undisclosed amount in African company Conergies Group.

Conergies Group is a leading west African energy company with more than 130
projects in Ivory Coast, Mali, Senegal, Burkina Faso, Benin, Guinea and
Guinea-Bissau.

First Quantum Minerals scraps plan to cut jobs in Zambia

LUSAKA (Reuters) - Canadian mining firm First Quantum Minerals says it has
ended plans to layoff 2,500 workers in Zambia due to higher tax plans and
will continue to dialogue with the government over the issue.

“First Quantum will not now proceed with the planned lay-off of any Zambians
involved in its production activities,” the company said in a statement on
Tuesday, adding that it may reduce its workforce involved in capital
projects.

“Furthermore, First Quantum commits to strive to maintain its production
where operational constraints allow.”

Poland's prime minister wants to see more workers return from UK

Poland's prime minster says he wants to see more workers return from the UK
to help its domestic economy grow.

Mateusz Morawiecki told the BBC that "more and more are coming back and I'm
pleased about that because there is a low level of unemployment... Give us
our people back".

But he said people who want to stay in the UK should be allowed to, "and be
treated exactly as they are now".

He said Prime Minister Theresa May had given him that commitment.

Speaking at the World Economic Forum, in Davos, Mr Morawiecki said there is
a low level of unemployment in Poland and 5.5% GDP growth. "So I would hope
that many Poles would come back to Poland," he said.

Mr Morawiecki is desperate for the UK to avoid a hard Brexit - an outcome he
says would be damaging for the UK, Poland and the whole EU.

Creative compromise

Poland has been critical of the way the EU has handled the Brexit
negotiations. It's foreign minister Jacek Czaputowicz has recently suggested
that the Irish backstop should be time limited to five years.

The backstop would keep the UK in a customs union with the EU until future
arrangements were agreed to avoid a hard border on the island of Ireland.

MPs 'playing Russian Roulette over Brexit'

What are Germany's no-deal Brexit plans?

This was seen by many in the UK as a crack in the solidarity of the EU27's
negotiating position and was dismissed by the European Commission.

The Polish prime minister said his minister's comments were an attempt to be
more creative in the fight for any compromise that avoided a hard Brexit.

No-deal Brexit

However, he told the BBC that the negotiation was now over and the ball was
now in Mr May's court.

I asked if he shared the emerging consensus among business and political
leaders that no-deal was getting less and less likely.

"I do get that sense, I see that sterling is strengthening and that may be
because of this," he replied.

His comments follow remarks by the former chancellor George Osborne, who
told the BBC that a delay of Brexit was now the most likely outcome.

However, International Trade Secretary Dr Liam Fox warned that political and
business leaders gathered at Davos were becoming far too complacent in
assuming that a no deal Brexit would be averted and that could prove costly
for them as well as the UK.

"Some countries believe that no-deal is not possible so think - why should I
put the work - in its my job to remind them that it is a possibility and you
need to get that work done."--BBC

Microsoft's Bing search engine inaccessible in China

US tech giant Microsoft has confirmed that its search engine Bing is
currently inaccessible in China.

Social media users have expressed concern that the search engine might be
the latest foreign website to be blocked by censors.

Chinese authorities operate a firewall that blocks many US tech platforms,
including Facebook and Twitter.

Microsoft hasn't said if the outage may be due to censorship, or is merely a
technical problem.

"We've confirmed that Bing is currently inaccessible in China and are
engaged to determine next steps," Microsoft spokesperson said in a
statement.

A BBC correspondent in China attempted to visit the site, and was able to
access it through a Chinese internet provider on a desktop, but not on a
smartphone.

Many US tech companies are keen to tap into the Chinese market, but have a
difficult relationship with the authorities in Beijing.

The government's internet censorship regime, often known as the "Great
Firewall", uses a series of technical measures to block foreign platforms
and controversial content.

Chinese authorities have also cracked down on Virtual Private Networks,
which allow users to skirt around the firewall.

China-based messaging services and social media are restricted, with key
words and expressions blocked if they express dissent or ridicule senior
political leaders.

China ambitions

Bing's rival Google shut down its search engine in China in 2010, after rows
with the authorities over censorship and hacking.

Google has said that it has no immediate plans to re-launch a search engine
in China, but has admitted it has looked closely at the idea.

Has Google suspended China search plan?

Although Twitter is blocked, it maintains a Greater China office because
Chinese customers can use the platform to advertise abroad.

Facebook attempted to set up an office in China last year, but appears to
have been blocked.

Microsoft has maintained an office in Beijing since 1992. It has continued
to operate Bing and its communication service Skype in China.--BBC

Barclays bosses 'paid Qatar secret fees'

Senior Barclays bankers paid Qatar £322m in secret fees during the financial
crisis in return for bailout funds, a court heard on Wednesday.

The case against four former executives has been filed by the Serious Fraud
Office over Barclays' £11.8bn rescue.

The bank avoided a UK government bailout in 2008 by raising funds from
Middle Eastern investors.

The executives are charged with conspiracy to commit fraud. All four have
pleaded not guilty.

The defendants are John Varley, the bank's former boss; investment banking
executive Roger Jenkins; Thomas Kalaris, head of the bank's wealth
management business; and Richard Boath, former European Head of Financial
Institutions Group at the lender's investment bank.

The trial is expected to last from four to six months. The four accused were
all granted bail.

Why are four former Barclays executives on trial?

At the opening of the trial, prosecutor Edward Brown told Southwark Crown
Court that during the financial crisis, Barclays and other banks were "under
sometimes extreme pressure to raise further capital".

He said Barclays was "very anxious" to avoid accepting UK government money,
believing that this would place it under greater control and scrutiny from
the authorities.

He added: "It is no exaggeration to say that Barclays' future as an
independent bank was in jeopardy in September and October of 2008."

Mr Brown said Barclays received about £4bn in investments from the Qatar
Investment Authority and Qatar Holding during 2008.

In exchange, he said, the bank paid fees to Qatar, some of which were
additional commission fees that were hidden in two agreements described as
Advisory Service Agreements.

These were more than double the fees paid to other investors in the bank,
which he said "demonstrates that the Qataris drove a hard bargain".

While other, more junior bankers have been tried and even jailed in
unrelated cases for their parts in the financial crisis of 2007-08, this is
the first time criminal proceedings against senior executives have been
brought.

The trial continues.--BBC

Chinese censor calls Tencent news app 'vulgar'

One of China's leading news apps has been singled out for criticism by the
country's internet watchdog.

Tencent-owned Tiantian Kuaibao - which means "fast daily news" - was accused
of spreading "vulgar, negative and harmful information, which damaged the
online environment".

The Cyberspace Administration of China added that it had "cleaned up" nearly
9,382 apps and closed 733 websites over the past six months.

Tencent has not commented.

But this is not the first time its newsfeed service has fallen foul of the
authorities.

Last April, the app was temporarily removed from several Android stores in
China, alongside three other news services, after the CAC ordered them to
make changes to the content they were delivering.

Shenzhen-based Tencent has, however, been more vocal this week about its
efforts to combat misinformation on its WeChat platform, which is China's
biggest social network, with 1.1 billion monthly active users.

On Monday, it announced that a myth-busting initiative had been used by 295
million users last year.

The effort corrects false rumours circulating on the platform, including the
claim that onions could be used to ward off the flu virus.

However, the company appears to have a tricky relationship with one of
China's other regulators.

The State Administration of Press, Publication, Radio, Film and Television
ended a 10-month-long freeze on video-games approvals in December.

But, despite it having given the green light to the release of nearly 260
games over recent weeks, Tencent - the country's biggest publisher - has yet
to have any of its titles approved.

The issue has meant it has been unable to provide an update to the hit
battle-royal game PlayerUnknown's Battlegrounds (PUBG), which would allow it
to start monetising the title.--BBC

DHL could profit from no-deal Brexit, says boss

The boss of the world's largest logistics firm says that his company could
profit from a no-deal Brexit.

Deutsche Post DHL's chief executive Frank Appel said in the long run Brexit
would not benefit the UK or the EU.

But he said the firm might profit in the short term from the disruption
because "our business is to manage complex situations".

DHL, which employs 54,000 people in the UK was "starting to execute" plans
for a no-deal Brexit, he said.

He added he would prefer not to focus on short term profits when the wider
impact would be negative.

Speaking at the World Economic Forum, in Davos, Mr Appel said he did not
think a non-negotiated departure from the EU was "a smart idea" and he still
hoped that an alternative solution would be found.

He confirmed that no UK ministers had been in touch with the firm to talk
through its preparedness for Brexit.

Full coverage of Davos 2019

Mr Appel also said he believed that trade tensions around the world would
dissipate, and that goods and services would continue to move freely across
borders.

"There is no country that ever succeeded by being alone," Mr Appel warned.
"The world has become more global".

He cited the EU's recent trade deal with Japan, arguing that while trade
wars make headlines, efforts to reduce regulatory barriers were continuing
apace.

Trade stays

The chief executive of Kuwaiti logistics firm Agility echoed these
sentiments.

Tarek Sultan, whose business in the UK has expanded rapidly, told the BBC
that "free trade is here to stay".

"It's not going to be reversed by the US government taking a hard line on
trade agreements," he added.

"The US China trade situation would only be detrimental to the global
economy if it were to continue over the long term, but I don't see that
happening."--BBC

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

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opinions expressed and recommendations made are subject to change without
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