Major International Business Headlines Brief::: 25 January 2019

Fri Jan 25 08:13:31 CAT 2019

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Major International Business Headlines Brief::: 25 January 2019

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

*  Goldman Sachs warns UK investment could take a Brexit hit

*  South Africa's Eskom should be split, experts to tell president - sources

*  Algeria economic growth up to 2.3 pct in 2018-fin min

*  South African rand firms; Vodacom slumps on revenue slowdown

*  Ugandan firm uses blockchain to trace coffee from farms to stores

*  Madagascar names Richard Randriamandranto as finance minister

*  Egypt's economy seen growing 5.3 pct in year ending in June

*  Nigeria's Access Bank sees no need to raise equity raise in Diamond Bank merger

*  Vodacom reports quarterly slowdown, shares fall

*  South African consumer confidence holds steady -survey

*  Microsoft's Bing search engine restored in China

*  Brexit uncertainty is a disgrace, says Airbus

*  Renault and Nissan usher in new era

*  Eurozone's economic outlook darkens as growth risks increase

*  Brexit: Jaguar Land Rover extends shutdown over no-deal fears

 <mailto:info at bulls.co.zw> 

Goldman Sachs warns UK investment could take a Brexit hit

The new chief executive of Goldman Sachs says that a "difficult" Brexit will negatively affect its investment plans in the UK.

David Solomon told the BBC that while there has been a hiring freeze in the UK, the bank has been adding staff in the EU over the last two years.

The outcome of Brexit would effect decisions about Goldman's people and resources, he said.

The Wall Street giant employs 6,000 people in the UK.

Speaking at the World Economic Forum, in Davos, Mr Solomon said: "If this [Brexit] is resolved in a difficult way, or in a hard way, I do think it'll have an impact on where we invest in where we put people.

"All these things ultimately have an impact on the investment decisions and the business decisions that all of us as business leaders make."

Sympathy with Trump

Of Goldman's UK staff, a few - in the dozens - have been asked to move to locations elsewhere in Europe.

However, the bank has added over a thousand staff to offices in Frankfurt, Paris, Stockholm, Milan and Madrid.

Full coverage of Davos 2019

While Brexit is a concern for the bank, it is not top of its list of worries. That spot goes to the fraught relationship between the world's two largest economies - the US and China.

While some see the US as the aggressor in the trade war with China, Mr Solomon has sympathy with Donald Trump's ambitions to reset the rules.

"I think the administration has it right. I think there have been imbalances in the way the US and China have dealt with each other, particularly the openness of China's had with respect to US business.

"We want to see a level playing field and we want to see our technology and our investment over a long period of time protected," Mr Solomon told the BBC.

He said he hoped that the US and China could resolve their differences by March - the date that the US is planning to introduce a new wave of higher tariffs on imports from China.

Global recession

Mr Solomon speaks for many at this year's World Economic Forum.

The chatter in the congress hall, the receptions and the restaurants, is focused on the US and China, and whether the trade tensions between the economic superpowers could tip the world into a serious slowdown.

The Goldman boss said he didn't think a global recession was imminent, but he said there was a 15% chance of a downturn in the US this year, and a 50% chance next year.

Neither Mr Solomon, nor anyone else in Davos, is prepared to make such a precise estimate of the chances of the no deal Brexit that most businesses here fear.

But it is certainly fair to say that he and most business leaders in Davos think it's becoming less likely.--bbc

 <mailto:info at bulls.co.zw> 

South Africa's Eskom should be split, experts to tell president - sources

JOHANNESBURG (Reuters) - South Africa’s Eskom could be split into three separate firms under proposals from experts President Cyril Ramaphosa has hired to help revive the ailing state power company, two sources familiar with the matter told Reuters.

Reforming Eskom is vital to get Africa’s most industrialised economy firing on all cylinders. It supplies more than 90 percent of the nation’s power but is drowning in debt.

A Sustainability Task Team, picked by Ramaphosa, is due to report to the president next week, but shared its preliminary thoughts about Eskom with senior members of the ruling African National Congress (ANC) at a two-day meeting that ended on Monday.

One senior ANC source briefed by the task team said it proposed a “functional unbundling of Eskom,” which would involve separating it into three state-owned entities responsible for power generation, distribution and transmission.

A second source who met the task team recently confirmed it favoured splitting up Eskom - a strategy which analysts say should encourage greater efficiency and transparency.

Ramaphosa’s task team also told senior ANC members that Eskom, which has around 420 billion rand ($30 billion) of debt and is regularly cited as the biggest threat to the country’s public finances, needed another government bailout to survive, said the senior source, who asked not to be named.

“The ANC recognises that there is a need for a serious turnaround strategy for Eskom. But it feels very strongly that it should not lead to privatisation or massive job losses,” the senior source said.

Eskom’s debt pile was built up due to heavy staffing, stagnating power sales and rising coal costs that it has not been able to pass on to customers, analysts say. Cost overruns on building two major power plants have also hit its finances.

DIVISIONS

Traders said leaks about the task team’s proposals, which were also reported in South Africa’s Business Day newspaper, pushed Eskom bonds higher on Thursday, with the 2023 and 2025 bonds hovering near five-month highs.

Ramaphosa has made shoring up ailing state firms like Eskom a priority since replacing Jacob Zuma as president in February, but progress has been slow because of severe fiscal constraints.

He also has to deal with divisions in the ANC over how to manage the economy and trade unions which want to avoid layoffs.

Ramaphosa rejected a proposal by Eskom’s board of directors last year for the government to take 100 billion rand of the utility’s debt, saying other options needed to be looked at.

He told the World Economic Forum in Davos this week that his government would release Eskom’s turnaround plan “in the next few weeks”.

The task team’s members have agreed not to disclose their recommendations publicly, and Ramaphosa could choose to ignore their ideas. But analysts say action is needed as creditors are reluctant to lend more to Eskom without a credible rescue plan.

Eskom spokesman Khulu Phasiwe said he could not comment on the task team’s proposals. “The presidency will make formal pronouncements on this matter,” he told Reuters.

($1 = 13.7998 rand)

Algeria economic growth up to 2.3 pct in 2018-fin min

ALGIERS (Reuters) - OPEC member Algeria’s economy grew 2.3 percent in 2018 due to higher oil prices, the finance ministry said on Thursday, up from 1.4 percent the previous year but below a four percent government forecast.

The price of the country’s oil exports last year averaged $72.43 a barrel, against $52.71 in 2017, it said.

Oil and gas account for 60 percent of the budget and 94 percent of total exports revenue.

The North African country also increased state spending for 2018 by 25 percent after a 14 percent cut in 2017.

Algeria has failed for now to develop its non-hydrocarbon sector, which grew four percent last year, up from 2.2 percent in 2017, according to the ministry’s figures.

The government expects the economy to expand by 2.6 percent this year due to a 1.5 percent reduction in spending and lower energy revenue projection.

Oil and gas earnings should reach $33.2 billion, down from the $34.37 billion target for 2018, because of growing domestic consumption.

The government is benefiting from a recovery in global crude oil prices but a large proportion of energy revenue is still being used to pay for goods imports due to poor domestic production.

South African rand firms; Vodacom slumps on revenue slowdown

JOHANNESBURG (Reuters) - South Africa’s rand rose to a near one-week high against the dollar on Thursday as risk-taking crept back into markets, while a slump in mobile operator Vodacom’s shares dragged the bourse lower.

Vodacom was hit by a slowdown in quarterly group and service revenue growth, as its home market performed badly.

At 1521 GMT, the rand - which has enjoyed a strong start to 2019 - traded at 13.7200 per dollar, 0.65 percent firmer than its previous close. The currency was trading at its firmest since Jan. 18.

The rand has tracked global markets this week, rallying on Wednesday as top trading partner China pledged more fiscal spending to support its own slowing economy.

“As the U.S. continues its shutdown and volatility falls, the appeal of carry trades seems to be back in favour. South Africa is sitting on some pretty decent real interest rates now (repo rate less inflation) and this is certainly going to entice some idle money,” Standard Bank’s chief trader Warrick Butler said in a note.

“A retest of 13.6500 may be on the cards now after the failure to breach 14.0000,” he added.

Data on Wednesday showed South Africa’s consumer inflation fell significantly in December, to 4.5 percent from 5.2 percent in the previous month, adding to evidence that the central bank is unlikely to raise interest rates at its next monetary policy meeting in March.

The Reserve Bank left the repo rate unchanged at 6.75 percent last week.

Government bonds firmed, as the yield on the benchmark 2026 instrument dropped 6.5 basis points to 8.785 percent.

Stock markets were on the backfoot, in contrast to many other emerging market stock indexes which gained on improved risk appetite. The Johannesburg Stock Exchange’s Top-40 index was down 0.56 percent to 47,473 points while the broader all-share index was down 0.51 percent to 53,639 points.

Vodacom fell almost 6 percent to 121.87 rand per share, the biggest faller on the blue-chip index.

It was joined by rival MTN, which fell nearly 3 percent. Ugandan President Yoweri Museveni said on Thursday that the firm needs to sell shares on the local stock exchange.

Ugandan firm uses blockchain to trace coffee from farms to stores

KAMPALA (Reuters) - An Ugandan company has started using blockchain, the technology behind virtual currency Bitcoin, to certify shipments of coffee to try to meet growing demand from consumers for more information about where products have come from.

Carico Café Connoisseur said the move could help to boost farmers’ incomes, as consumers are usually prepared to pay more for goods that can been traced back to their origins.

Blockchain works by providing a shared record of data held by a network of individual computers rather than a single party. Its supporters say this makes it hard to tamper with, and so a secure way to track goods along the supply chain

Carico Café Connoisseur CEO Mwambu Wanendeya told Reuters a blockchain-certified shipment of one of its coffee products, Bugisu Blue, arrived in South Africa last month. He declined to give the size of the shipment, but said it was several tonnes.

Uganda is Africa’s largest coffee exporter followed by Ethiopia, according to the International Coffee Organisation, and has some of the world’s highest quality beans. It predominantly cultivates the robusta variety, but also has extensive fields of arabica trees.

Limited domestic processing capacity means the country exports nearly all of its beans in raw form.

The blockchain certification means consumers can trace the coffee’s journey by using their smartphones to scan the product’s QR codes or via the certification site provenance.org.

Every step of the beans’ journey - from when farmers drop them off at collection centres to warehousing, inspection by regulators and shipping - is recorded.

“The idea is to give the consumer an appreciation of what happens on the journey and also to ensure that there’s more linkages with the farmer,” Wanendeya said.

“Traceability is important because people are increasingly concerned that ... farmers get rewarded for their work.”

The process will provide consumers with information such as the type of coffee bean, the year it was harvested, and where it was grown.

Founded in 2016, Carico Café is working with two farmer cooperatives with hundreds of members. Wanendeya predicted the innovation could boost farmers’ incomes by 10 percent.

“Consumers are willing to pay more if they can know where exactly the coffee is coming from,” he said.

Uganda is keen to increase coffee exports from the current level of around 4 million 60-kilogramme bags per year.

However, a seedlings distribution programme it hoped would boost production has yielded modest results, in part because of a decline in interest in coffee among farmers due to often low and unstable prices.

Madagascar names Richard Randriamandranto as finance minister

ANTANANARIVO (Reuters) - Madagascar has appointed Richard Randriamandranto as its economy and finance minister, Valery Ramonjavelo, secretary general of the presidency, said on Thursday.

The announcement was made days after Christian Ntsay was retained as its prime minister, following a presidential election late last year.

Egypt's economy seen growing 5.3 pct in year ending in June

CAIRO (Reuters) - Egypt’s economy is expected to grow 5.3 percent in the fiscal year that ends in June, according to forecasts economists polled by Reuters, the same view found in a survey three months ago.

The economy, with the exception of the oil sector, has struggled to attract foreign investors since the 2011 uprising that unseated Hosni Mubarak.

Egypt’s non-oil private-sector activity shrank for a fourth month in December. Private-sector activity has expanded in only five months over the last three years.

“Medium-term growth remains slightly subdued as the government maintains a strong grip on the economy, but is nonetheless supported by an expected expansion in the infrastructure, manufacturing and tourism sectors,” said Nadene Johnson, an economist at NKC African Economics.

Hoping to bolster investor confidence, Egypt has been implementing tough economic reforms as part of a three-year, $12 billion deal agreed with the International Monetary Fund in November 2016. The reforms include a value-added tax, cuts to energy subsidies and a steep currency devaluation.

The median forecast from 14 economists polled Jan. 8-22 put growth at 5.3 percent in the current 2018/2019 fiscal year and 5.5 percent the following two fiscal years.

Egypt had targeted growth at 5.8 percent in its 2018/2019 fiscal year budget.

“Egypt should enjoy a relatively stable pace of growth over the next couple of years ... but the economy will remain strained by ongoing fiscal consolidation, soft private sector activity and uncertainty in the global economy,” wrote Maya Senussi, senior economist for the Middle East at Oxford Economics.

“That said, we see greater support from public investment this year, reinforced by lower oil prices lowering subsidy spending. Consumers also stand to gain from lower oil prices, while lower interest rates should generally inject some life into the private sector,” she said.

The latest consensus put urban consumer inflation at 15.5 percent in 2018/2019, up from a previous forecast of 14.9 percent. Economists polled expected the rate to fall to 13.1 percent in the 2019/2020 fiscal year and 10.9 percent in the 2020/2021 fiscal year.

Annual urban consumer price inflation fell to 12.0 percent in December from 15.7 percent in November as monthly food prices dropped. Core inflation, which strips out volatile items such as food, rose to 8.30 percent in December from 7.94 percent.

Millions of Egyptians live below the poverty line and struggle to meet basic needs. They have faced rising costs since the pound was floated in November 2016.

“Inflation was revised lower in 2019 thanks to the easing of global oil prices. However, there are some risks to the outlook including further tightening of global conditions (particularly U.S. interest rate tightening); or renewed emerging market turmoil, which could jeopardize capital inflows and weigh on the value of the pound,” Johnson said.

Nigeria's Access Bank sees no need to raise equity raise in Diamond Bank merger

LAGOS (Reuters) - Nigeria’s Access Bank sees no need to raise equity capital as part of its merger with local rival Diamond Bank, Access chief executive Herbert Wigwe said on Thursday.

Wigwe said a shareholder vote on the merger would be held on March 5.

Vodacom reports quarterly slowdown, shares fall

JOHANNESBURG (Reuters) - South Africa’s Vodacom on Thursday reported a slowdown in quarterly group and service revenue growth sending shares in the mobile phone operator down 8.6 percent at the market open.

Vodacom, which competes with MTN Group, implemented a number of “generous” promotions in the quarter and introduced lower-priced bundle offers through the year.

These efforts dented data revenue growth in South Africa.

“In South Africa, service revenue declined 0.9 percent, affected by the effects of our pricing transformation strategy ...as well as the transitioning of traffic between our roaming partners,” Chief Executive Shameel Joosub said in a statement.

Group revenue for the quarter to Dec. 31 rose 1.5 percent to 23 billion rand ($1.66 billion) under the previous IAS 18 accounting standard, slowing from growth of 6.7 percent a year earlier.

Service revenue rose 2.4 percent to 18.9 billion rand, slowing from 5.5 percent growth a year earlier.

Using the new IFRS 15 accounting system, group revenue fell 2.1 percent and service revenue fell 2.9 percent.

Vodacom’s shares fell 8.6 percent at the open before paring loses to trade down 6.84 percent at 0850 GMT.

The unit of Britain’s Vodafone said service revenue from its international operations jumped 13.2 percent buoyed by data revenue growth and its mobile financial services platform, M-Pesa.

Group customers increased 7.1 percent to 79 million, growing 5.4 percent in South Africa and 9.3 percent in its international operations.

Vodacom will be implementing the End-User Subscriber Charter Regulations on March 1, which will drag on data revenue growth in the near term, it said.

The regulations will allow consumers to carry over their unused data and operators are no longer allowed to charge consumers out-of-bundle rates.

($1 = 13.8318 rand)

South African consumer confidence holds steady -survey

(Reuters) - Consumer confidence in South Africa remained stable in the fourth quarter of 2018, after falling sharply in the third quarter, but stayed far above levels recorded in the final years of the nation’s previous presidential regime, a survey showed on Thursday.

The consumer confidence index (CCI) compiled by the Bureau for Economic Research remained at +7 in the fourth quarter, compared with the preceding quarter.

“The fact that the CCI held steady at this fairly positive reading during the fourth quarter is good news and signals that consumers’ willingness to spend is still relatively high,” FNB Chief Economist Mamello Matikinca-Ngwenya said.

The sharp drop in fuel prices should bring long-awaited budgetary relief to many households and simultaneously reduce the pressure on the South African Reserve Bank to implement further interest rate hikes to counter rising inflation, Matikinca-Ngwenya said.

Farms and factories dragged South Africa out of its first recession in almost a decade, data showed in December, as the economy grew by more than expected in the third quarter. [nL8N1Y925Z]

The positive data was a boost for President Cyril Ramaphosa, who has pledged to re-start growth after a decade of stagnation under his predecessor, Jacob Zuma.

Matikinca-Ngwenya also cited the risks of further load shedding and a potential sovereign credit rating downgrade by Moody’s to junk status and said it was unlikely that either job creation, wage growth or credit growth would improve meaningfully during the first half of 2019.

Still, consumer confidence has been better off than levels seen during former President Zuma’s last three years, when the index ranged between readings of -3 and -15.

Microsoft's Bing search engine restored in China

Microsoft has confirmed that access to its Bing search engine in China has been restored after an outage.

The firm did not offer any explanation for why the search engine had been inaccessible.

The outage caused concern that the service might have been blocked by the Chinese authorities.

Authorities in China operate a firewall that blocks many US tech platforms, including Facebook and Twitter.

"We can confirm that Bing was inaccessible in China, but service is now restored," Microsoft said it a statement.

China-based censorship monitoring group GreatFire says the outage was unlikely to be government-related.

GreatFire tests whether URLs are accessible in China, and to what extent their domains show evidence of censorship.

The group says Bing China is hosted in China on Chinese servers, which means it's already subject to local censorship directives.

Chinese censor calls Tencent app 'vulgar'

How Chinese authorities censor your thoughts

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.

Big tech blocked

Microsoft has continued to operate in China, even as many other US tech companies have been blocked or have pulled out.

Facebook, Twitter and Google are all blocked on the mainland.

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

Bing has a small market share among search engines in China, where locally-grown Baidu dominates the market.--BBC

Brexit uncertainty is a disgrace, says Airbus

Airbus has warned that it could move wing-building out of the UK in the future if there is a no-deal Brexit.

The planemaker's chief executive, Tom Enders, said Airbus "will have to make potentially very harmful decisions for the UK" in the event of no deal.

He said it was a "disgrace" that firms could still not plan for Brexit.

His remarks were welcomed by Business Minister Richard Harrington, who said Airbus was correct to warn of the dangers of a no-deal scenario.

"Crashing out is a disaster for business," Mr Harrington told a meeting at the German embassy on Thursday morning.

"Airbus is correct to say it publicly about and I'm delighted they have done so," he added.

In all, Airbus employs 14,000 people in the UK.

That includes 6,000 jobs at its main wings factory at Broughton in Wales, as well as 3,000 at Filton, near Bristol, where wings are designed and supported.

Brexit: Jargon-busting guide to the key terms

Brexit: What does no deal mean?

Mr Enders said: "Please don't listen to the Brexiteers' madness which asserts that, because we have huge plants here, we will not move and we will always be here. They are wrong."

Responding to Airbus's statement, a government spokesperson said: "The UK is a world leader in aerospace. We are the home of the jet engine, the wing factory of the world and are world-renowned for our skills and capabilities in the most technically-advanced parts of aerospace manufacturing.

"It remains our top priority to leave the EU with a good deal; a deal that is good for business, will protect jobs and prosperity, and provide the certainty that business needs."

Recent moves

Airbus's latest intervention follows announcements by two other companies that they were moving their headquarters out of the UK.

Sony said it would transfer its European HQ from the UK to the Netherlands to avoid disruptions caused by Brexit.

And appliance maker Dyson announced it was moving its headquarters to Singapore, from Malmesbury in Wiltshire, although it said the decision had nothing to do with Brexit.

However, another firm, Japanese technology company Fujitsu, told the BBC it had "zero intention" of moving its operations out of London.

Duncan Tait, Fujitsu's European boss, said it had "a thriving business in the UK", adding: "We're recruiting people every week."

Brexit prompts Sony's Europe HQ move

Dyson to move head office to Singapore

Mr Enders said that while the world's second-largest aerospace group could not "pick up and move our large UK factories to other parts of the world immediately", Airbus could be "forced to redirect future investments in the event of a no-deal Brexit".

"And make no mistake, there are plenty of countries out there who would love to build the wings for Airbus aircraft," he added.

"Brexit is threatening to destroy a century of development based on education, research and human capital."

Katherine Bennett, senior vice-president of Airbus in the UK, reinforced Mr Enders' message.

She told the BBC that a no-deal Brexit would be "catastrophic" for her business, with "chaos at the borders" that would hold up delivery of vital components.

This is not the first time that Airbus has warned of the consequences for its business of a no-deal Brexit.

Last year, it issued a risk assessment saying that if the UK left the EU without a withdrawal deal, it "would force Airbus to reconsider its investments in the UK and its long-term footprint in the country".

However, Mr Enders' latest remarks suggest that the firm has toughened its stance since then.

MPs are putting forward alternative plans to Theresa May's Brexit plan after it was voted down by Parliament last week.

The UK is due to leave the EU on 29 March this year.

The gloves are off. That's the clear message from Airbus' pugnacious chief executive, Tom Enders.

Opposition to Brexit from Airbus is not new. The company warned of the potential dangers to its business even before the referendum had taken place.

Since then, the rhetoric has been steadily ramped up. Last year, the company published a "Brexit Risk Assessment", in which it warned that leaving without a deal would be "catastrophic" for its business.

We've had warnings about the risk to future investment before, but now the threat is much more explicit and the language is much more forthright. The failure to come up with a clear plan is a "disgrace". Other countries would "love" to build the aircraft wings currently made at Broughton.

There's even a warning not to listen to "the Brexiteers' madness". The time for diplomacy, it seems, is past.

So what's changed? The company clearly believes that the risk of "no deal" is growing, thanks to the impasse in the House of Commons.

And as a business which relies on the rapid transfer of parts from the UK to assembly lines in France and Germany, it is very exposed to any delays in shipments - or problems getting new safety certification.

Meanwhile, Tom Enders is due to leave his job in April. So perhaps he's in a very good position to talk tough, without worrying whom he's upsetting in the process.--BBC

Renault and Nissan usher in new era

Renault and Nissan have pledged to continue their alliance as its architect, Carlos Ghosn, resigned from the French carmaker.

Mr Ghosn's resignation came as he remained incarcerated in Japan where he is accused of financial misconduct at Nissan.

Renault said Michelin's Jean-Dominique Senard had been appointed chairman, and Thierry Bolloré chief executive.

Mr Ghosn was sacked by Nissan shortly after his arrest on 19 November.

Renault's management shake-up was welcomed by Nissan's chief executive Hiroto Saikawa.

"In the big picture, this is a big milestone that we are reaching. We are starting a new chapter. So I welcome this new leadership of Renault," Mr Saikawa said.

Global giant

The architect of the Renault-Nissan alliance, Mr Ghosn had not been sacked by Renault. Instead, the French car giant had handed day-to-day operations to Mr Bolloré, who now takes the role permanently.

Mr Ghosn faces three charges in Japan of financial misconduct, including understating his income and aggravated breach of trust. He denies any wrongdoing and could remain in custody for months after his application for bail earlier this week was denied.

Questions had been asked about future of the alliance - which Mitsubishi joined three years ago - which Mr Ghosn oversaw.

It sold 10.6 million vehicles in 2017 and together employs 470,000 around the globe.

On Thursday, as Renault announced its boardroom change it did not use Mr Ghosn's name but said: "The board praised the alliance's track record, which has enabled it to become the world's leading automobile manufacturer".

Carlos Ghosn: Renault-Nissan's relentless 'cost killer'

Carlos Ghosn: Five charts on the Nissan boss scandal

Until his arrest, Mr Ghosn had achieved star status in Japan. Born in Porto Velho, Brazil, to Lebanese parents, according to one poll he was the man most Japanese women wanted to marry and in another he came seventh in a poll of who should run the country.

He oversaw Nissan's recovery after Renault took a stake in the then-troubled car maker in 1999, the start of the alliance.

Renault's new chairman, Mr Senard, will be responsible for managing Renault's alliance with Japanese carmaker Nissan, while Mr Bolloré will co-ordinate the carmaker's activities.

Mr Senard also backed the alliance. "It's important that this alliance remain extremely strong," Mr Senard said. "It is our compulsory duty to go forward together."

The French union CGT has estimated that Mr Ghosn could be in line for a severance deal of up to €28m (£24.5m) in addition to an annual pension of €800,000.

French Finance Minister Bruno Le Maire told AFP the government, which owns a 15% stake in Renault, would be "extremely vigilant as key shareholders on the exit conditions that will be set by the (Renault) board of directors".

He said Mr Senard's main responsibility "will be to ensure the future of the alliance between Renault and Nissan and to strengthen it".

Prof David Bailey at Aston Business School said the alliance would no longer be able to rely on Mr Ghosn to hold it together, but it was important that the alliance remained, because of the cost pressures facing the industry.

"They are going to have to come up with new ways to glue it together," Prof Bailey said.

Renault has said previously that it has not found any evidence of wrongdoing yet, and an investigation into executive pay has shown no signs of fraud so far.

Mr Saikawa said "communication between the boards of the two companies has been a bit difficult" since Mr Ghosn's arrest, and that he was looking forward to "better communication".

Nissan said it had now begun preparations to hold an extraordinary general meeting in April to discuss new board members.

The agenda will be to cover the departure of Carlos Ghosn and Greg Kelly, an aide to Mr Ghosn who was arrested in November and bailed on Christmas Day. The shareholder meeting will also cover the appointment of a new director to be nominated by Renault.--BBC

Eurozone's economic outlook darkens as growth risks increase

The clouds seem to be gathering for the eurozone's economy.

At a news conference after a policymaking meeting on Thursday, European Central Bank (ECB) president Mario Draghi described an outlook that is becoming more overcast.

Economic data, he said, had been weaker than expected, and the risks to growth have increased.

There was a clear hint in his remarks that it will take even longer than the ECB has been suggesting before it starts to raise interest rates.

Mr Draghi referred to some international factors undermining the outlook: the slowdown in China and the declining stimulus from President Trump's tax cuts in the US. He also mentioned the car industry in Germany, which has been disrupted by new emissions testing procedures.

Brexit uncertainty

He said there had been an increase in uncertainty as a result of threats of trade protectionism. The lack of clarity in the Brexit negotiations was also a source of uncertainty.

He didn't expect extensive disruption to the eurozone from Brexit, but he also said there was a need to take into account value chains (presumably across borders) and the fact that some countries are more exposed to the effects of the UK's departure from the EU.

The big issue for the ECB is the extent to which all these factors will persist.

They have certainly injected some uncertainty into the outlook, but Mr Draghi said the view of the ECB's Governing Council, which makes policy decisions, is that the probability of a recession is low.

Still, they did discuss that risk.

IMF warns trade tensions could hit growth

German growth slowest for five years

World economy faces 'darkening skies'

The ECB is still very much in the territory of unconventional policy, prompted by the financial crisis.

It's main interest rate is zero, and the rate it pays banks for overnight deposits is below that - it's negative - and has been for more than four years.

Rate rise recedes

Nonetheless, the long march towards normal policy has in a sense started. The ECB ended its purchases of financial assets (mainly government bonds) last month.

But it still has the $3tn worth of securities it bought under that programme, known as quantitative easing. And the bank's interest rates are ultra low.

The ECB has given some indication of when it might start to raise interest rates. This is actually seen as a policy tool in its own right and it has a name: forward guidance.

The bank says that it "expects the key ECB interest rates to remain at their present levels at least through the summer of 2019, and in any case for as long as necessary" to get inflation to its target of below, but close to, 2% .

That forward guidance was unchanged, but in the news conference Mr Draghi gave a hint that it might well take the bank longer than that to get rates moving up. He was asked about the fact that in financial markets, there's an expectation that rate rises won't come until next year.

He said they "have understood our reaction function". This rather technical turn of phrase is at the very least consistent with the prospect of ECB rate rises receding a bit further into the future.--BBC

Brexit: Jaguar Land Rover extends shutdown over no-deal fears

Jaguar Land Rover is to extend its annual April shutdown in car production because of uncertainties around Brexit.

The UK's biggest carmaker will be idle for an extra week because of fears of disruption at its car and engine plants at Liverpool, Birmingham and Wolverhampton.

The shutdown during 8 to 12 April will be in addition to a scheduled closure the following week.

Britain is due to leave the European Union on 29 March.

"There will be an additional week of production stand-down... due to potential Brexit disruption," JLR said in a statement.

The company, which is cutting jobs because of a steep fall in sales, has previously warned about the impact of Brexit on its ability to source just-in-time components from mainland Europe.

BMW is already planning to close its plant near Oxford for a month after Brexit, while Honda is planning a six-day closure.

After Prime Minister Theresa May's Brexit plan was defeated in Parliament last week, fears have grown among some businesses of a no-deal exit.

Also on Thursday, Airbus, which makes aircraft wings in the UK, warned it could shift manufacturing from the UK in the event of no deal.

Brexit uncertainty a disgrace, says Airbus

Jaguar Land Rover confirms 4,500 job cuts

JLR said its move had been under consideration for some time, but it was waiting for clarity over the terms of Britain's EU withdrawal. The company said it needed to inform its workers ahead of any holiday and annual leave plans.

Future investment

JLR has been saying for more than a year that Brexit uncertainty would eventually take its toll on the perception of the UK as a stable and competitive base for global manufacturing.

Last July, the company said it needed more certainty around Brexit, and warned that a "no-deal" Brexit would cost the company more than £1.2bn in profit each year.

Chief executive Ralf Speth said last year: "We have spent around £50bn in the UK in the past five years - with plans for a further £80bn more in the next five. This would be in jeopardy should we be faced with the wrong outcome."

JLR employs just under 39,000 workers at sites including Castle Bromwich, Solihull and Wolverhampton in the West Midlands, and Halewood on Merseyside.

Thursday's news follows an announcement earlier this month that JLR is to cut 4,500 jobs under plans to make £2.5bn of cost savings.--BBC

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