Major International Business Headlines Brief::: 11 March 2019

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Major International Business Headlines Brief::: 11 March 2019

 


 

 


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*  Zimbabwe to allow foreign platinum miners control of local operations

*  Egypt's urban inflation jumps to 14.4 pct in Feb from 12.7 pct in Jan

*  Rwanda aims to sell stake in cement firm Cimerwa this month

*  Gulf stocks hit by global market weakness, IPOs boost Egypt

*  Shares in S.Africa's Aspen plunge on debt, slow sale proceeds

*  Aspen to split South African pharma business after disposal of non-core
assets

*  Botswana sees lower mineral revenues in 2019

*  Tanzania orders cleanup at Acacia gold mine, threatens closure

*  Kenyan shilling firm against the dollar

*  Ex-CEO of Tanzania's Bank M charged with fraud, money laundering

*  China halts flights using same plane as in Africa crash

*  Businesses urged to 'do more' to win public contracts

*  Sir Rocco Forte: 'No point in delaying Brexit'

*  US jobs shock as growth slows

*  Brexit: Could the UK drop tariffs to zero?

 

 


 <mailto:info at bulls.co.zw> 

 


 

                                      

Zimbabwe to allow foreign platinum miners control of local operations

HARARE (Reuters) - Zimbabwe will scrap a law that denies foreign platinum
mining companies control of their operations in the country, the mines
minister said on Thursday.

 

Foreign platinum and diamond miners have been restricted to only 49 percent
ownership of their Zimbabwe operations by the black economic empowerment law
introduced during Robert Mugabe’s rule. The law was aimed at increasing
black Zimbabweans’ stake in the mining sector, but foreign investors said
its implementation was often murky and open to abuse.

 

Zimbabwe holds the world’s second-largest known platinum reserves behind
South Africa.

 

Asked to confirm a Bloomberg report that Zimbabwe will scrap the black
empowerment rules for platinum, Winston Chitando told Reuters in a WhatsApp
message: “Confirmed. It’s part of continued review of (the) Zimbabwe is open
for business mantra.”

 

On when the amendments will be brought to parliament, Chitando said that
dates would be announced soon.

 

Chitando, who is in Washington with Finance Minister Mthuli Ncube scouting
for investment in Zimbabwe, did not respond when asked whether the changes
will be extended to the diamond sector.

 

President Emmerson Mnangagwa is keen to revive the mining sector after years
of reticence from foreign investors during Mugabe’s rule.

 

Investor interest in Zimbabwe’s underexplored resources has improved more
recently, however. Australia’s Arcadia Resources is setting up a lithium
mine while privately owned Karo Resources signed a $4.2 billion deal to set
up a platinum mine and refinery and revived a Russian joint venture for a
big platinum project near Harare.

 

Among existing operations, Impala Platinum and Anglo American Platinum have
assets in Zimbabwe while Sibanye-Stillwater has a joint venture mine with
Implats.

 

Although no foreign platinum company had been forced to cede control,
investors said the empowerment law added to the country’s political risk
profile.

 

The finance minister has said that Zimbabwe attracted $8 billion into mining
last year alone and that projects are expected to take off in the next three
years.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 



Egypt's urban inflation jumps to 14.4 pct in Feb from 12.7 pct in Jan

CAIRO (Reuters) - Egypt’s annual urban consumer price inflation increased to
14.4 percent in February from 12.7 percent in January, the official
statistics agency CAPMAS said on Sunday.

 

Egypt has implemented a series of tough austerity measures to help meet the
terms of a $12 billion IMF loan programme it signed in late 2016.

 

 

 

Rwanda aims to sell stake in cement firm Cimerwa this month

KIGALI (Reuters) - Rwanda’s government aims to put its 49 percent stake in
the country’s biggest cement maker, Cimerwa, up for sale this month, the
prime minister said on Saturday.

 

The company, which is 51 percent owned by South Africa’s PPC Ltd, has an
installed annual production capacity of 600,000 tonnes.

 

“We have asked our partners if they are interested and the timeline is one
month,” Edouard Ngirente told a meeting of senior officials broadcast on
national television. “By the end of this month we will auction (the stake).”

 

He said PPC had yet to specify if it was interested in the stake, which he
gave no valuation for, adding that other buyers would be sought if
necessary.

 

A construction boom in Rwanda has driven up demand for cement as the
government builds roads, power plants and a new international airport.
Private developers have also been building new houses and office blocks.

 

The head of Cimerwa told Reuters in July that demand for cement was growing
at 7-8 percent annually as new building projects come up. Rwanda also
imports cement from neighbours Uganda and Tanzania.

 

 

Gulf stocks hit by global market weakness, IPOs boost Egypt

DUBAI (Reuters) - Gulf markets ended lower on Sunday, weighed down by weak
global markets and a drop in oil price, but Egyptian stocks defied the
trend, gaining on the back of positive momentum generated by the initial
public offering of a state-owned company.

 

Abu Dhabi’s stock index lost 0.9 percent, hurt mainly by First Abu Dhabi
Bank, which was down 1.6 percent, while other banks were also lower.

 

FAB’s shares were hit partly by technical factors, as the stock fell through
its fifty-day moving average on Thursday and also below its 100 day moving
average, an analyst said.

 

The Abu Dhabi index has had a weak March, falling 5.2 percent since the
start of the month.

 

Dubai’s stock exchange was down 0.6 percent , weighed down by Emaar
Properties , which was down 0.8 percent and Dubai Islamic Bank, down 0.8
percent.

 

“Dubai is basically just giving up the funny little rally it had in the
second half of February,” the analyst said. “The rally was triggered by
Aldar’s super-duper dividend, and everyone got excited and (then) everyone
realised there wasn’t a reason to get excited.”

 

Egypt’s stock index was the only gainer on Sunday, up 0.5 percent.

 

This was due to the initial public offering of state-owned cigarette maker
Eastern Company last week, as well as another upcoming IPO, Karim Abdelaziz,
general manager of brokerage Miracle for Securities Transactions, said.

 

Saudi Arabia’s main index was down 0.2 percent, hit by a weak performance
among banking stocks. Banque Saudi Fransi was down 1.4 percent, while Samba
Financial Group was down 0.7 percent.

 

Banks had gained in early trading after Saudi authorities said on Friday
they had no current plans to increase Islamic tax levels on the private
sector.

 

The Saudi market is anticipating the Tadawul exchange’s impending entry into
the FTSE Russell emerging market index next week, which could bring billions
of dollars of fund inflows.

 

Qatar’s index lost 0.1 percent, trading at its lowest in more than five
months, weighed down by Qatar National Bank, and Qatar International Islamic
Bank, which were down 0.7 percent and 2.5 percent respectively.

 

Qatar was one of 2018’s best-performing markets globally, with stocks
gaining 21 percent, helped by a lifting of limits on foreign ownership of
shares. But it has lost 5.2 percent this year.

 

“Qatar was overdue for a small correction that would let the valuation catch
up with the price. And that decline is healthy,” said Talal Samhouri, head
of asset management at Amwal LLC.

 

 

 

Shares in S.Africa's Aspen plunge on debt, slow sale proceeds

JOHANNESBURG (Reuters) - Shares in Aspen Pharmacare lost almost a third of
their value on Friday on concerns about ballooning debt at Africa’s biggest
drugmaker and delays in the sale of an infant formula business that would
help bring borrowing down.

 

The South African firm, which lost about 19.5 billion rand ($1.3 billion) of
its market value, built up debt as it shifted from being a mainly generics
business in a few countries into a multinational with specialist therapies,
including for thrombosis.

 

Aspen’s debt stood at 54 billion rand ($3.7 billion) at the end of 2018,
over six times more than in 2013 when it began buying everything from
blood-clot treatment brands and a sterile plant from GlaxoSmithKline to
anaesthetics rights from AstraZeneca and a factory in the Netherlands.

 

The stock dropped 29 percent to close at 100.66 rand, bringing losses since
September to 63 percent. Friday’s fall was the stock’s biggest daily slide
in more two than decades.

 

Investors worried that a deal to sell Aspen’s infant formula business,
announced in September and worth 635 million euros ($713 million), had yet
to close. Aspen had said it would be completed in the first quarter. It is
due to close in May.

 

“The market doesn’t like the fact that the deal they announced some time ago
is dragging out and taking some time to be finalised,” said Greg
Katzenellenbogen, senior portfolio manager at Sanlam Private Wealth.

 

Aspen Deputy Chief Executive Gus Attridge said his company’s shares had
tumbled since September because investors “are concerned by the high levels
of debt we have.”

 

“So growth is fairly light or static at the moment and we have this high
level of debt which means that we’re not in an acquisitive state,” he said.

 

The company’s net debt to core earnings, or EBITDA, stood at 4.4 times at
the end of June, at the upper end of a threshold of 4.75 times negotiated
with its creditors in December. It is also well above three times Aspen’s
medium-term target.

 

Attridge said the ratio should fall to four times by the end of the
financial year in June, helped by the sale of the baby milk formula
business.

 

The price tag for the deal is also less than some investors had expected,
which analysts said raised questions about whether the firm had been forced
to sell in a hurry.

 

The company said in December it had struck a deal with U.S. firm Mylan to
distribute a portfolio of prescription and over-the-counter drugs in
Australia and New Zealand. That deal included an option for Mylan to buy the
portfolio.

 

Aspen said on Friday it could reduce debt if Mylan exercised the purchase
option, which it can from March. Proceeds from the deal would be about 188
million Australian dollars ($132 million).

 

($1 = 14.5301 rand)

 

($1 = 0.8904 euros)

 

 

 

Aspen to split South African pharma business after disposal of non-core
assets

JOHANNESBURG (Reuters) - Multinational drugmaker Aspen Pharmacare said it
will split its South African Commercial Pharmaceuticals business into two
divisions as it disposes of non-core assets to reduce its debt.

 

Without giving details, the company said in its half-year results statement
that it was conducting a strategic review of its South African and European
operations and a second phase would develop strategies for each of the
businesses.

 

Although it did not say what each division would include, Aspen said the
split would improve its focus on products and customers.

 

The commercial pharmaceuticals business consists of regional brands,
anaesthetics, thrombosis and high potency & cytotoxics portfolios.

 

Over the past five years Aspen has transitioned from a generics-focused
pharmaceutical business operating in a few select countries into a
multi-national firm with strong regional brands and diversifying into
specialised therapies such as thrombosis and anaesthetics.

 

Aspen’s normalised headline earnings per share (HEPS) for the six-months
ended Dec. 31, fell by 9 percent to 743.4 cents from 814.1 cents a year
earlier. HEPS is the main profit gauge in South Africa, which strips out
certain one-off items.

 

Normalised earnings before interest, tax, depreciation and amortisation from
continuing operations fell 3 percent to 5.5 billion rand ($379.32 million),
while revenue inched up 1 percent to 19.7 billion rand.

 

“Relative movements in exchange rates had an impact on financial
performance,” the company said.

 

Shares in Aspen, which operates in 56 countries, have plunged nearly 50
percent since it announced a lower-than-expected sale price of its infant
milk business in September, which raised questions on whether the company
was pressured to sell because it was close to breaching its debt
obligations.

 

On Thursday, Aspen said borrowings, net of cash, have increased by 6.7
billion rand to 53.5 billion rand as a result of the rand currency weakness
relative to foreign currency denominated loans, payments relating to
acquisitions and capital expenditure.

 

Aspen said it expects proceeds from its infant milk disposal and inflows
from the divestment of its non-core pharmaceutical portfolio in the
Asia-Pacific region to bring the gearing ratio covenant measure within the
specified level of 4.0 times for the June and December 2019 measurement
periods.

 

“Aspen’s medium-term target for the gearing ratio is less than 3.0 times,”
it said.

 

In December, Aspen said it had engaged with its creditors to negotiate a
conditional and temporary adjustment to its leverage ratio covenant to allow
for any delay in the infant milk disposal.

 

($1 = 14.4998 rand)

 

 

 

Botswana sees lower mineral revenues in 2019

GABORONE (Reuters) - Diamond rich Botswana expects mineral revenues in the
2019/20 fiscal year to drop by 4 percent to 13.6 billion pula ($1.26
billion) due to a decline in royalties and dividends, a minerals ministry
budget document showed on Thursday.

 

Mineral Resources Minister Eric Molale said in the document that global
diamond demand was showing signs of slowing down. Retail jewellery sales
fell during the last quarter of 2018, he said, while polished prices
continued to decline into the beginning of 2019, albeit at a slower rate.

 

“Trading and prices of diamonds are expected to remain subdued during the
first quarter of 2019 due to significant overstocking of small polished
diamonds,” Molale said in the document presented to parliament late on
Wednesday.

 

Debswana, a joint venture between Anglo American’s De Beers and Botswana,
produced 24.1 million carats of diamonds in 2018, a 6 percent jump from the
previous year.

 

The company is the largest contributor to Botswana’s government revenues.

 

($1 = 10.7527 pulas)

 

 

 

Tanzania orders cleanup at Acacia gold mine, threatens closure

DAR ES SALAAM (Reuters) - Acacia Mining Plc must halt waste water pollution
at its North Mara gold mine in Tanzania by March 30 or the facility will be
shut down, the country’s mining minister said on Friday.

 

Doto Biteko said Acacia needs to stop contaminated water seeping from a
waste storage dam at the mine to nearby communities in the country’s north.

 

“The life of even one Tanzanian is worth more than their gold mining
activities,” Biteko told Reuters.

 

Acacia Mining said it had stopped a temporary overspill at the mine, blaming
vandals for destroying sections of the pipe it uses to move waste water.

 

“The mine has undertaken to manage all seepage through the use of additional
pumps and construction of other containment facilities,” it said in a
statement.

 

The mine has been flagged by the chief executive of Barrick Gold, Acacia’s
majority shareholder, as a possible “tier 1” asset, meaning it is low cost,
large and has a remaining life of more than 10 years.

 

London stockbroker Peel Hunt described the mine as the “backbone” of
Acacia’s cash flow. “We see the potential for a shutdown of the mine as a
serious threat to Acacia in the near term”, the brokerage said in a note.

 

RBC analyst James Bell described the minister’s comments as a “potential
further pressure tactic ... due to the ongoing dispute between Acacia and
the government”.

 

North Mara is Acacia’s largest mine, producing 336,055 ounces of gold last
year, comprising 65 percent of the company’s output, Acacia said in its
annual report.

 

The mine has faced long-standing accusations of pollution, which Acacia
Mining has previously denied.

 

Acacia’s troubles in Tanzania began after President John Magufuli, nicknamed
“The Bulldozer”, swept to power in late 2015 pledging to secure a bigger
share of the country’s natural resource wealth and fight corruption.

 

Production at the London-listed miner’s other two gold-producing mines in
Tanzania - Bulyanhulu and Buzwagi - has been hampered by a ban on exports of
gold and copper concentrates.

 

In September, Magufuli instructed the country’s environment watchdog to
conduct a new probe into historical allegations of pollution at North Mara.
He described a previous report that found no evidence of wrongdoing as being
compromised.

 

Canadian miner Barrick outlined last month details of a deal it reached with
the government of Tanzania to settle the disputes with Acacia, which has
been excluded from the talks.

 

Barrick’s announcement confirms a 2017 deal that called for the creation of
a Tanzanian firm to manage Acacia’s assets, a 50-50 split of economic
benefits and a $300 million payment to resolve all outstanding tax claims in
the East African country.

 

In 2017 Acacia was handed a $190 billion tax bill - about four times the
country’s gross domestic product - for underreporting output, an allegation
it denies.

 

 

Kenyan shilling firm against the dollar

NAIROBI (Reuters) - The Kenyan shilling maintained its three-year record
high against the dollar on Friday, supported by ample dollar supply from
offshore portfolio investors buying government debt amid week dollar demand
from the energy sector, traders said.

 

At 0854 GMT, commercial banks quoted the shilling at 99.60/80 per dollar,
compared with 99.75/95 at Thursday’s close.

 

 

 

Ex-CEO of Tanzania's Bank M charged with fraud, money laundering

DAR ES SALAAM (Reuters) - The former chief executive officer of Tanzania’s
Bank M was charged with fraud and money laundering on Thursday, two months
after the central bank revoked the bank’s licence.

 

Sanjeev Kumar, who denied the charges at a court in the commercial capital
Dar es Salaam, was sent to a remand prison as suspects in money laundering
cases are not entitled to bail.

 

Tanzania’s central bank took over the management of Bank M, which had assets
of nearly $500 million last August after it suffered critical liquidity
challenges, before transferring them to another bank, Azania, in January.

 

    Kumar, 63, who was also one of the shareholders of Bank M, was charged
with multiple counts of fraud, obtaining money by false pretence and money
laundering, court documents showed.

 

    Tanzania’s financial services sector, which is dominated by lenders like
CRDB Bank and NMB Bank, has been hit by a spike in bad loans. 

 

In December, the International Monetary Fund said nearly half of Tanzania’s
45 banks were vulnerable to adverse shocks and risked insolvency in the
event of a global financial crisis.

 

 

 

China halts flights using same plane as in Africa crash

China's aviation regulator ordered local airlines to halt Boeing 737 Max 8
flights after a deadly Ethiopian Airlines crash using the same model.

 

Airlines must suspend commercial operations of all Boeing 737 Max 8 planes
before 18:00 local time (10:00 GMT).

 

The Ethiopian Airlines flight crashed minutes after takeoff on Sunday,
killing all 157 people on board.

 

It was the second crash involving a 737 Max 8 in the past five months.

 

While experts warn it is too early to say what caused the Ethiopian Airlines
disaster, it comes after the same model crashed in a flight operated by Lion
Air in October. The plane lost altitude soon after takeoff, killing 189
people on board.

 

"Given that two accidents both involved newly delivered Boeing 737 Max 8
planes and happened during take-off phase, they have some degree of
similarity," the Civil Aviation Administration of China said in a statement.

 

Air disasters timeline

What is the Boeing 737 Max 8 aircraft?

How could a brand new plane crash?

Several Chinese airlines will be affected by the suspension including Air
China, China Eastern Airlines, and China Southern Airlines.

 

More than 90 Boeing 787 Max 8 models are in use in mainland China. The
aircraft is relatively new to the skies, having only been in commercial use
since 2017.

 

Boeing said it was "deeply saddened" by the crash and is sending a team to
provide technical assistance with the investigation.

 

What happens next?

The investigation will be led by Ethiopian authorities co-ordinating with
teams of experts from Boeing and the US National Transportation Safety
Board.

 

China's aviation regulator said it would notify airlines as to when they
could resume flying the Boeing jets.

 

The Chinese have not been the only ones to react to the disaster by
suspending operations.

 

Cayman Airways said in a statement that it has grounded its two 737 MAX 8
planes "until more information is received".

 

Ethiopian Airlines, however, said it would continue to fly its fleet of 737
MAX 8 aircraft since the cause of the crash has not yet been determined.

 

Several North American airlines operate the same aircraft and have said they
are monitoring the investigation. Southwest Airlines flies 31, while
American Airlines and Air Canada each have 24 in their fleet.--BBC

 

 

 

Businesses urged to 'do more' to win public contracts

Businesses looking to secure public sector contracts will need to do more to
help improve society, the UK government is set to announce.

 

Ministers want firms to tackle issues like modern slavery and climate
change.

 

The UK, which spends £49bn with outside organisations every year, will also
try to award more contracts to small firms.

 

It is "morally right" for the UK to make certain demands of companies taking
taxpayers' money, Cabinet Office minister David Lidington will say.

 

When drawing up public contracts, the government will now be looking at:

 

Firms that employ people from diverse backgrounds, including those with
disabilities and from ethnic minorities

How companies reduce modern slavery and cyber-security risks in their supply
chains

Businesses that are focused on environmental sustainability

Companies that boost employees' employability potential through staff
training

However, the government stressed that the changes to public procurement
would not add complexity or increased costs to the process.

 

"By making sure that these social values are reflected not just across the
government, but through all the companies we work with, we will take a major
step towards our goal of creating an economy that works for everyone," Mr
Lidington will say.

 

'Stop bidding wars'

Charity Anti-Slavery International has welcomed the UK's efforts to stamp
out modern slavery, but it wants to see the government do even more.

 

Modern slavery is occurring across the UK, with a higher percentage of
incidents in industries such as domestic work, construction, agriculture,
catering and hand car washes.

 

"At the moment big businesses are made to report slavery in the supply
chain, but there are no penalties for either failing to submit the
statement, or whether you report that it exists," Jakub Sobik, a spokesman
for Anti-Slavery International told the BBC.

 

Modern slavery is merely at one end of a spectrum of exploitative practices,
and steps need to be taken to combat the practice of forcing employees to
work overtime due to unrealistic targets, he added.

 

The government also needs to stop companies from driving the price down
during the bidding process.

 

"We would like the government to make sure that the price they pay is right
for the services," said Mr Sobik.

 

"If the price they're being paid for the services is not high enough to make
sure they pay the staff fairly - this is one of the reasons that companies
might use exploitative practices."--BBC

 

 

 

Sir Rocco Forte: 'No point in delaying Brexit'

A no-deal Brexit is better than a bad deal, and Theresa May's is a bad deal
according to hotel tycoon Sir Rocco Forte.

 

Ahead of a series of Brexit votes in parliament this week Sir Rocco is
urging MPs to reject both the prime minister's deal and the option of
delaying Brexit.

 

"There's no point delaying, Europe has said the deal is the deal, it's on
the table and we're not going to change it, so what do we do? Are we going
to delay? What's it going to do? if we take no deal off the table, we're
finished. We have no negotiating position," he says.

 

Sir Rocco Forte is the son of Lord Forte - who built what was once known as
the Trust House Forte Group, which at one point owned Travelodge, Little
Chef, Happy Eater and a majority stake in the Savoy Hotel.

 

That empire was bought in the 1990s and Sir Rocco has since left the Little
Chef and Travelodge sector of the hospitality industry to pursue the luxury
end of the market, with plans for new luxury Five-Star hotels in Asia and
Europe.

 

'Heads above parapets'

The list of business owners and leaders who think leaving the EU without a
deal is nothing to fear is a short one.

 

Engineering billionaire Sir James Dyson, JCB chairman Lord Bamford, and City
hedge fund managers like Sir Paul Marshall and Sir Crispin Odey are some of
a relatively rare breed.

 

But not as rare as people think according to Sir Rocco.

 

"I'm not sure I'm in a minority, there's a lot of people who think like me
in the business world who don't put their heads above the parapet for fear
of damaging their businesses," he says.

 

He admits a no-deal Brexit may cause some short term problems but insists
that business and the UK economy as a whole should focus on the long term.

 

"It may cause some short term disruption although I think that's been hugely
exaggerated
This not about what happens this year or next year, it's about
what happens in the long term and this country can thrive if its outside of
the constraints of the EU."

 

Most people in the hospitality industry have one major concern. Immigration
- or the potential lack of it.

 

Arriving at Sir Roccos' Brown's hotel, the majority of staff on the door on
the front desk who greet you are from the EU.

 

There are 2.3 million EU nationals living and working in the UK at a time
when unemployment is at its lowest level since 1975. Is he not worried that
without access to EU workers his business will suffer?

 

"Everybody assumes that because we're going to control immigration, that
immigration is going to stop," he says.

 

"It isn't going to stop and it won't stop. We had 270,000 immigrants from
outside the EU last year who all came in through a process and procedure,
there's no reason why Europeans shouldn't come in through the same way."

 

'Serious problem'

That is not the position of the majority of those in the hotel business. The
British Hospitality Association estimates that 700,000 EU nationals work in
the industry in the UK - some 15% of the total workforce. Rising to over 30%
in some parts of the UK.

 

Without access to EU workers in the future, the industry has a "serious
problem".

 

Sir Rocco Forte is indeed a rare specimen in the business world. A UK
educated, British citizen of European descent who does business in the
hospitality industry who doesn't worry about a no-deal Brexit.

 

But he is not a lone business voice warning about the problems involved in
delaying Brexit.

 

To be clear - most business owners and trade bodies hate the idea of a no
deal Brexit.

 

But most also hate the idea of a Brexit delay and see it as an extension of
the purgatory of uncertainty that has starved the UK of investment for the
last two and a half years.

 

As for Rocco Forte, he will continue to invest in his hotel chain. But as
his critics will point out... those plans don't currently include the
UK.--BBC

 

 

 

US jobs shock as growth slows

The US economy created the lowest number of jobs for a year-and-a-half in
February, well below forecasts.

 

Just 20,000 new jobs were created last month against expectations of a
180,000 increase, official figures show.

 

It is the lowest growth in non-farm payrolls since September 2017 when
employment was affected by Hurricanes Harvey and Irma.

 

However, the small rise followed a sharp increase in new jobs in January,
which was revised up to 311,000.

 

Ian Shepherdson, chief economist Pantheon Macroeconomics, said that the
expectation for 180,000 new positions in February was too high because the
figures at the beginning of the year doubled-counted government workers who
took second jobs during the US Government shutdown.

 

How much has the shutdown hit the US economy?

Trump doesn't understand economics, says former Fed chair

He said that average new jobs growth over a three-month period was 186,000
which "is entirely respectable".

 

"Indicators of labour demand have softened a bit but are nothing like weak
enough to suggest that the February number is indicative of a new trend; we
expect a return to the high 180,000 in March," he added.

 

Official data showed that the number of people ending part-time jobs or on
temporary leave dropped by 225,000.

 

The US Bureau of Labor Statistics said: "This decline reflects, in part, the
return of federal workers who were furloughed in January due to the partial
government shutdown."

 

Wage growth

The figures also showed that growth in average earnings picked up to an
annual rate of 3.4%, from 3.1% the month before, while the unemployment rate
fell, dropping to 3.8% from 4% in January.

 

President Donald Trump said rising wages were "great for the American
worker", adding: "I don't know if they expected to see it."

 

The construction sector saw the worst performance in February, with
employment falling by 31,000 jobs compared with an increase of 53,000 in
January.

 

Kully Samra, vice president at Charles Schwab, said that despite the weak
job creation last month "the outlook for the US economy remains strong
relative to the rest of the world".

 

"The question is whether businesses are becoming more cautious because of
weaker economic data and the return of volatility; or is the economy
weakening a result of reduced business confidence?," he added.

 

However, Michael Pearce, senior US economist at Capital Economics, said:
"The sharp slowdown in payroll employment growth in February provides
further evidence that economic growth has slowed in the first quarter.

 

"That adds weight to our view that the Fed will not be raising interest
rates this year."

 

The Dow Jones Industrial Average opened down 212.81 points, or 0.8%, at
25,260.42. Investors were disappointed by the jobs data and a steep fall in
Chinese exports amid a trade war with the US.--BBC

 

 

 

Brexit: Could the UK drop tariffs to zero?

MPs are set to hold key votes next week on the terms of Brexit, the outcome
of which could determine whether the UK has greater flexibility to set its
own trade tariffs.

 

A second "meaningful vote" on the Brexit agreement negotiated by Prime
Minister Theresa May is due to take place on Tuesday.

 

However, if no agreement can be reached, and the UK ultimately leaves the
European Union on 29 March with no deal in place, reports last week
suggested the UK government might cut trade tariffs on between 80% and 90%
of goods, with some tariffs being scrapped completely.

 

Business Secretary Greg Clark told the BBC that new tariff schedules would
be published only after next week's vote on Mrs May's Brexit agreement, if
it became clear the UK would be leaving the EU without a deal.

 

He said the changes would have "big implications" for some sectors.

 

What is a tariff?

A tariff is a tax applied only to internationally traded goods.

 

In the great majority of cases, tariffs are applied to imported goods by the
country importing them.

 

But there can also be tariffs on exported goods.

 

Big Brexit vote: What do I need to know?

Brexit: Who knows what happens next?

Brexit: A really simple guide

What are tariffs for?

Import tariffs give a competitive advantage to local industry because it is
not subject to the tariffs.

 

They also provide revenue for governments, although compared with other
types of tax the contribution is relatively small in rich countries.

 

Tariff revenue collected by the UK was about £3bn in 2017.

 

Under a no-deal Brexit it could be less, if tariffs are eliminated widely
enough, or more, because remaining tariffs would be applied to EU goods that
are currently tariff free.

 

Why does the UK have to set new tariff rates?

In one word: Brexit. As a member of the EU, the UK currently applies the
EU's common customs tariff to goods imported from outside the EU (with
exemptions for goods from countries with which the EU has a free trade
agreement).

 

That will continue if there is a withdrawal agreement, and then for as long
as the backstop to avoid a hard border in Ireland is in force.

 

After that, or in the event of a no-deal Brexit, the UK would no longer
apply the EU's tariff policy and so would have to make decisions about what,
if any, tariffs to impose.

 

What are the current tariffs?

To give some examples that the UK could apply if it chose to: the EU maximum
tariff on cars is 10%, while on some types of clothing and crockery it is
12%.

 

On some types of beef it is 12.8% plus 265 euros per 100kg (agricultural
tariffs can be very complicated).

 

Are there any restrictions on the tariffs the UK could set?

The rules of the World Trade Organization (the UK is a member) do impose
some constraints. WTO members have "schedules" which are mainly lists of
tariffs they promise not to exceed.

 

Countries can freely apply tariffs below those levels. Generally they must
apply the same tariffs to goods from all members, subject to some
exceptions.

 

They can reduce or eliminate tariffs on goods from countries with which they
have a free-trade agreement.

 

Rich countries can also do that for goods from developing countries.

 

What are the potential benefits?

Tariff revenue (such as it is) would go the UK Treasury. It is currently
paid to the EU (less 20% for the cost of collecting it).

 

It would also enable the UK government to set tariff levels in line with its
judgement of the UK's best interests (rather than the interests of the whole
EU). It is likely that some tariffs would be reduced or eliminated,
especially where there are no British producers to protect.

 

To take one obvious example: citrus fruit.

 

That could help lower costs in the shops.

 

It is, however, important to note that some goods are already exempt from
the EU tariffs, where the country concerned has a trade agreement.

 

Another consideration is that lower tariffs might be offset by a decline in
the value of the pound, which analysts think is particularly likely in the
event of a no-deal Brexit.

 

What are people worried about?

If the UK does reduce tariffs some industries, and especially agriculture,
could be exposed to more competition.

 

Some have suggested that if the UK were to remove all tariffs (as some have
advocated) it could lead to many business failures among manufacturers and
farmers.

 

That is probably why (unconfirmed) reports about the government's plans
suggest some sectors will retain tariff protection, including agriculture,
ceramics and cars.

 

To the extent that the UK does retain any tariffs, they would, in the event
of a no-deal scenario, have to apply to imports from the EU, which are
currently completely tariff free. That follows from WTO rules.

 

That could make EU goods more expensive.--BBC

 

 

 

 

 

 

 

 

 

 

 

 


 

 


 

INVESTORS DIARY 2019

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


Mash

AGM

Boardroom, ZB Life Towers, 77 Jason Moyo Avenue

18 March 2019 12pm

 


Zimbabwe 

Independence Day

Zimbabwe

18 Apr 2019 

 


 

Good Friday

 

19 Apr 2019

 


 

Easter Saturday

 

20 Apr 2019

 


 

Easter Sunday

 

21 Apr 2019

 


 

Easter Monday

 

22 Apr 2019

 


 

Workers Day

 

01 May  2019

 


 

Africa Day

 

25 May 2019

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 


 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 


DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
Faith Capital (Pvt) Ltd for general information purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy or
subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
contents or otherwise arising in connection therewith. Recipients of this
report shall be solely responsible for making their own independent
investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and sourced from third parties.

 


 

 


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