Major International Business Headlines Brief::: 22 November 2019

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Major International Business Headlines Brief::: 22 November 2019

 


 

 


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*  S.Africa keeps rates on hold as inflation risks balanced

*  Unions in wage talks with distressed South African Airways

*  S.Africa's Mr Price H1 profit drops 10% as clothing unit lags

*  Discoveries to help Senegal's gas-to-power switch - minister

*  France takes aim at Saudi over failed West Africa commitments

*  Nigeria to issue guarantee note to lenders to Bank of Industry -minister

*  Investec profit sapped by UK banking, wealth weakness

*  Kenyan shilling surges against the dollar

*  'Speak up': Lloyd's takes harassment crackdown to pubs

*  New warning on global economic slowdown

*  WeWork axes 2,400 staff globally

*  Labour eyes 'radical' plan for companies

*  Apple 'loses money on phone repairs'

*  BA passengers face delays after 'technical issue'

*  Google to restrict political adverts worldwide

*  Government borrowing in October highest since 2014

*  General election 2019: How do government finances work?

 

 


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S.Africa keeps rates on hold as inflation risks balanced

PRETORIA (Reuters) - South Africa’s central bank kept its repo rate unchanged at 6.5% in a close decision on Thursday, saying it wanted to see inflation expectations closer to the midpoint of its target range, despite a sustained drop in headline inflation.

 

Three members of the central bank’s monetary policy committee had preferred to keep the repo rate on hold and two had wanted a cut of 25 basis points (bps), Reserve Bank Governor Lesetja Kganyago told a news conference.

 

The central bank’s main focus is keeping inflation near the middle of its 3%-6% target range, but inflation has regularly surprised to the downside this year owing to tepid economic growth.

 

October inflation data came in below expectations at 3.7% year on year on Wednesday, an almost nine-year low.

 

Twenty-one of the 28 economists polled by Reuters last week said the repo rate would remain on hold, while seven predicted it would be cut by 25 bps.

 

“The overall risks to the inflation outlook are assessed to be balanced, but uncertainty about inflation risks is unusually high,” Kganyago said, citing unpredictable weather, food and utility prices and a volatile exchange rate.

 

“In this persistently uncertain environment future policy decisions will continue to be highly data-dependent.”

 

The central bank lowered its forecast for economic growth this year to 0.5%, from 0.6%, and lowered its forecasts for the next two years to 1.4% and 1.7%, respectively.

 

It said business confidence remained weak and that longer-term weakness in most sectors was a serious concern.

 

 

 

 

 

 

 

 

 

 


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Unions in wage talks with distressed South African Airways

JOHANNESBURG (Reuters) - Two trade unions at state-owned South African Airways (SAA) said they would continue talks with the airline on Thursday aimed at ending a week long strike over wages and job cuts that has brought the national flag carrier to the brink of collapse.

 

The National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA), which have been leading the strike, said in a statement that they hoped to find an acceptable compromise in the talks with SAA.

 

SAA has nearly no cash left and may miss salary payments this month. The carrier’s swift decline has turned it into a black hole for government bailout money, with some 20 billion rand ($1.35 billion) being spent on it in the past three years.

 

Its operations are marred by an unprofitable international route network and a fleet of inefficient planes. The airline said on Thursday it would suspend all flights between Johannesburg and Hong Kong from Nov. 23 up to and including Dec. 14 to curb significant financial losses on the route.

 

A South African union filed a case on Thursday asking a court to subject SAA to a business rescue, with the aim of restoring it to profitability.

 

Solidarity, which mostly represents white, Afrikaans-speaking employees, said it would “mean that the court can appoint a business rescue practitioner with comprehensive powers to rescue the airline.”

 

 

 

S.Africa's Mr Price H1 profit drops 10% as clothing unit lags

JOHANNESBURG (Reuters) - South African budget retailer Mr Price Group Ltd said on Thursday its interim profit dropped over 10%, as its apparel division was affected by an “imbalance” in its product assortment and weak economies at home and abroad.

 

Mr Price, known for its no-frills clothing and furniture stores, has grown for more than three decades by undercutting competitors and catering to thrifty shoppers’ fashion needs. The South African company, however, has struggled amid a tough retail environment and economic slowdown in key markets.

 

Its headline earnings per share, the main profit measure in South Africa, for the 26 weeks ended Sept. 28 stood at 443.2 cents compared with 494.3 cents last year.

 

Falling comparable sales at the apparel division dented its first-half performance. An imbalance in its product mix resulted in excess stock that required markdowns to clear, the company said.

 

Mr Price faces stagnant economic growth, high unemployment and rising cost of living in its home market South Africa, while other economies in the continent have also struggled.

 

“While trade has been challenging, the energy across the business is high and the team is clear on what is needed to return the group to its winning ways,” the company said in a statement, adding that it was focused on winning market share, especially in apparel, and a shift in momentum was underway.

 

Sales in the apparel division declined 4.3% to 5.8 billion rand ($393.17 million), on a comparable basis. The unit also constitutes almost 70% of retail sales outside of South Africa, which were down 2.2%.

 

Total revenue, however, was up 2.6% at 10.8 billion rand, despite a 1.5% drop in retail sales on comparable basis. The home segment reported sales growth of 3.2%.

 

“A short-term recovery in the consumer environment seems unlikely,” Mr Price said, adding that meaningful growth in South Africa will only return when broad-based structural reforms gain traction.

 

($1 = 14.7520 rand)

 

 

Discoveries to help Senegal's gas-to-power switch - minister

PARIS (Reuters) - Major gas discoveries offshore Senegal will enable the West African nation to switch its coal and oil-fired power plants to gas generation in the coming years, Petroleum and Energy Minister Mouhamadou Makhtar Cisse said on Thursday.

 

Cisse told a gas and power summit in Paris that Senegal would import liquefied natural gas (LNG) in the first phase of the conversion. The imports will stop around 2022 when the country’s gas production comes on stream.

 

“Senegal’s gas will principally be used for gas-to-power,” Cisse said, adding the country aimed to build a gas pipeline network of around 450 km.

 

Two large offshore fields are currently being developed in Senegal. Australia’s Woodside Energy is developing the SNE field, while BP is developing the Greater Tortue Ahmeyim project.

 

Cisse told the conference that 12 new offshore blocks had been put up for bids in a licensing round launched last week, adding Senegal was in talks with partners to raise around $2 billion to finance its share in the development of current oil and gas projects.

 

Cisse said gas would help lower Senegal’s energy costs and make it more competitive in the region, attracting industries. Production costs are still very high because Senegal depends on fuel imports for its energy, the minister said.

 

Senegal has around 1.2 gigawatts (GW) of installed power capacity for its 15 million inhabitants. Some 70% of the capacity is fossil-fuel coal or oil-fired generators, 22% renewable solar and 8% hydropower.

 

Senegal’s sole 125 megawatt coal-fired power plant would also be converted to gas-fired, Cisse said.

 

He added Senegal would add another 1 GW of power generation capacity over the next five years and all of the projects would be private sector ones.

 

 

 

France takes aim at Saudi over failed West Africa commitments

PARIS (Reuters) - France’s armed forces minister criticised close ally Saudi Arabia on Wednesday for failing to honour commitments it made almost two years ago to provide millions of euros to a West African counter-terrorism force fighting Islamist militants.

 

Saudi Arabia agreed in December 2017 to provide about 100 million euros ($110.7 million) to the G5 Sahel force, which is composed of the armies of Mali, Mauritania, Niger, Burkina Faso and Chad.

 

But nearly three years after its launch, the G5 Sahel remains perennially underfunded and hobbled by poor coordination.

 

Groups with links to al Qaeda and Islamic State have strengthened their foothold across the arid Sahel region, making large swathes of territory ungovernable and stoking ethnic violence, especially in Mali and Burkina Faso.

 

“For the G5, there was a first phase when the international community was mobilised and donors offered commitments to arm the G5, but then there were delays,” France’s minister of the armed forces, Florence Parly, told a parliamentary hearing.

 

“Saudi Arabia has still not honoured the promises it made ... I can only regret that Saudi Arabia doesn’t honour those commitments,” she said, adding it appeared others were now starting to disburse funds.

 

It was a rare rebuke by France of its Saudi ally and comes almost two years after French President Emmanuel Macron had personally asked Saudi Arabia’s Crown Prince Mohammed bin Salman to contribute to the force and prove the kingdom’s intention to tackle extremist ideology.

 

France, the former colonial power in the region, intervened in Mali in 2013 to drive out Islamist militants who had occupied the north, but rather than stabilising the region, the situation has progressively worsened.

 

On Tuesday, it advised against all travel to Burkina, 10 days after 39 people were killed following a jihadist attack in the country.

 

France still has about 4,500 troops across the Sahel and the government has faced criticism at home that its troops are bogged down, while critical voices in the region have increasingly scorned Paris for failing to restore stability.

 

Parly dismissed those charges and said it was the easy way out by some politicians to blame France.

 

“We don’t have a desire to be in the Sahel eternally, but France provides useful support,” she said. “I don’t think we’re bogged down,” she said.

 

($1 = 0.9036 euros)

 

 

 

Nigeria to issue guarantee note to lenders to Bank of Industry -minister

ABUJA (Reuters) - Nigeria will issue a sovereign guarantee note worth 500 million euros to Credit Suisse and a syndicate of international lenders, the minister of state of finance, budget and national planning said on Wednesday.

 

The minister said the note would serve as collateral for a loan facility the syndicate is setting up for the government-owned development lender Bank of Industry.

 

 

 

Investec profit sapped by UK banking, wealth weakness

JOHANNESBURG (Reuters) - Weak UK banking and wealth management performances dragged on Investec’s first-half profit, piling pressure on the Anglo-South African financial services firm’s shares.

 

Investec said on Thursday the spin-off of its asset management division next year was on track, a plan that will leave it with just banking and wealth management operations.

 

Shares in Investec are down by almost 10% following a profit warning in September, and were around 2.5% lower in both London and Johannesburg by 0823 GMT.

 

Investec said its bank and wealth businesses were committed to meeting 2022 financial targets, although co-CEO Fani Titi, who will head them following the demerger, added it was hard to say when the uncertainty hurting performance would recede.

 

“If Brexit is sorted out and there is a level of certainty in the [UK] market... that should translate into better activity for our businesses,” he told a media call.

 

“But we don’t know when that certainty will return.”

 

Together, adjusted operating profit of the combined bank and wealth operations fell by 4.2%, driven by an 18.9% decline at UK specialist banking and a 10.8% drop in wealth and investment.

 

This was offset by an 8.5% increase at its South African specialist bank, thanks to higher fee income and cost controls.

 

Investec said the UK specialist bank’s performance was skewed by a subordinated debt restructuring that gave it a boost in the prior year.

 

By contrast, the asset management division, which will be renamed Ninety One and is on track to list separately in London in the first quarter of 2020, enjoyed net inflows of 3.2 billion pounds and a 6.3% growth in adjusted operating profit.

 

Co-CEO Hendrik du Toit, who will head that business once it is spun off, said Investec was pleased with its performance given global market volatility caused by trade tensions.

 

“These are the kind of environments in which firms can build market share who are focused on their clients, and in that sense we are very happy with the ... net inflows.”

 

Investec’s headline earnings per share, the main profit measure in South Africa, was 22.7 pence in the six months to Sept. 30, compared with 27.4 pence a year earlier.

 

The bank’s adjusted basic earnings per share, which reflect profits made in the course of ordinary operations, were down 4% from 30.1 pence last year to 28.9 pence this year.

 

 

 

Kenyan shilling surges against the dollar

NAIROBI (Reuters) - The Kenyan shilling surged against the dollar on Thursday with inflows from offshore investors buying stocks and government debt exceeding dollar demand from merchandise importers, traders said.

 

At 0747 GMT, commercial banks quoted the shilling at 101.25/45 per dollar, compared with 101.45/65 at Wednesday’s close.

 

 

 

'Speak up': Lloyd's takes harassment crackdown to pubs

When staff at the Lloyd's of London insurance market fancy a lunchtime pint, many will head to the nearby pubs off Leadenhall Market such as The Grapes and The New Moon.

 

But leaving the office behind will be harder this week, after the City institution decided to put posters up in the toilets of those pubs, urging its staff to report instances of sexual harassment they had witnessed.

 

It is the latest attempt by Lloyd's to stamp out a culture of sexism and bullying at the market, where 500 members of staff have reported witnessing instances of sexual harassment over the past year.

 

"Uninvited advances or physical contact. That's not a joke, that's harassment," reads one of the posters, while another warns against abuse masquerading as "banter".

 

The firm wants to take its campaign to other pubs around the City, but drinkers at The Grapes had mixed views about it.

 

One Lloyd's worker who did not want to be named called it "over the top", while someone from another insurance firm said that few people would take it seriously.

 

But a financial consultant drinking outside the pub told me that anything that raises awareness was worth a shot: "You hear a lot of fairly crude sexist talk among groups of mainly younger lads in here... It's a fairly toxic culture."

 

In March the Bloomberg news agency revealed a catalogue of sexual and verbal misconduct claims at Lloyd's, many fuelled by alcohol abuse. These ranged from verbal abuse to sexual assault, all against women.

 

Image caption

Lloyd's plans to the put the posters up in pubs around the City

Since then the 331-year-old market has been trying to clean up its image as the City's last bastion of boozy boorishness.

 

It has turned its on-site bar into a coffee shop and warned that anyone found under the influence of drink or drugs during working hours will be barred from the building. That applies not just to its directly employed staff, but the-near-50,000 pass holders - mainly brokers and insurers - who have access to the building to do business,

 

Lloyd's calls time on drink and drugs

Lloyd's reveals depth of sexual harassment culture

Other measures have been brought in too, and Lloyd's told the BBC that several people had been barred for "inappropriate behaviour", although it would not comment on individual cases.

 

The move to target pubs makes sense given the male-dominated insurance industry's longstanding association with boozy lunches. In a survey of 6,000 workers commissioned by Lloyd's in September, a quarter said they had observed excessive alcohol consumption at the marketplace over the past year.

 

 

At The New Moon a member of the bar staff tells me they never have issues with their regulars (who, of course, include workers not just from Lloyd's but a range of nearby companies). But a barmaid at a pub nearby says she's used to men in this part of town making "inappropriate remarks, usually after a lot of drinks".

 

"There is a culture of people drinking all day - they start at lunchtime and they're very polite. But when it gets to 8pm or 9pm they can be rude," she says.

 

One of her male colleagues has also witnessed bad behaviour and says he does not think Lloyd's curbs on daytime drinking have worked.

 

"In the last six months it has got busier in here. They can't drink on site so now they come here earlier. Before they would come at 5pm."

 

Some at Lloyd's have complained they are being unfairly maligned and that the issue of sexism goes wider than just one City organisation.

 

A 35-year-old woman drinking at The Grapes tells me she has worked at the market for 17 years and has never seen any harassment, nor have her friends.

 

"If there is a real-life allegation that is proven and true, then of course they have to take action. But in terms of putting posters up in the pubs that surround Lloyd's… maybe they are just protecting themselves in light of the bad press?"

 

In Lime Street, an older man who has just left the Lloyd's building tells me that claims of a toxic work culture are "completely overblown".

 

"There was very bad behaviour in the 80s. We lived through that, there was a mucky macho culture, no question. But in recent years I can honestly say it's become so strict in terms of regulatory control, management control, HR, you'd be an absolute idiot to behave like that."

 

Lloyd's boss John Neal is not complacent. He has called the allegations of harassment "devastating", and is likely to continue putting pressure on the 100 underwriting firms and 300 insurance brokerages based at the market.

 

Commenting on the new poster campaign - which is also being run inside Lloyd's offices - he said: "We expect all market participants to act with integrity, be respectful and always speak up. I hope this campaign encourages more people to do so."-BBC

 

 

 

New warning on global economic slowdown

A leading international economic organisation has warned that risks to the global outlook have increased.

 

The Organisation for Economic Cooperation and Development - the OECD - says in a new report that prospects have steadily deteriorated.

 

It forecasts continued growth of around 3% but warns that the risks have increased.

 

The report says a lack of direction on climate policy is holding back business investment.

 

Although the OECD is not forecasting a recession, it is a decidedly downbeat report.

 

There are calls for action from governments to address challenges, some of which have both long term and more immediate consequences.

 

Climate change is perhaps the most striking example.

 

The OECD says extreme weather events could lead to disruption of economic activity and could inflict long lasting damage on capital and land. They could also lead to what the report calls disorderly migration flows.

 

Insufficient policy action could increase the frequency of such events.

 

There is clearly a long term challenge for governments in addressing these issues, but the OECD says that there is already an impact on business investment.

 

In many countries it is investment and trade that has been at the centre of weakening economic performance.

 

It says governments must act quickly.

 

"Without a clear sense of direction on carbon prices, standards and regulation, and without the necessary public investment, businesses will put off investment decisions, with dire consequences for growth and employment," the OECD says.

 

The report argues that more clarity on climate policy - and also on digitalisation - would trigger a marked acceleration of investment by business.

 

It suggests the creation of national funds to make public investments in these areas.

 

Among the other challenges that the OECD mentions is the change in the Chinese economy, it is becoming a more services-oriented economy which means the country's demand for imported goods for its industries to process is unlikely to grow as strongly in the future.

 

Along with the shift in the shape of the Chinese economy, there has also been a gradual slowdown in the rate of growth since the start of the decade. For the previous thirty years, the economy had grown at a rate that the Chinese government accepted could no longer be sustained.

 

China is trying to ensure it is not too abrupt a slowdown. The possibility that it might not succeed is something the OECD identifies as a risk to the global economy.-BBC

 

 

 

WeWork axes 2,400 staff globally

Office rental company WeWork is cutting about 2,400 jobs globally in an effort to staunch its growing losses.

 

The move follows the dramatic collapse of WeWork's plans to raise money by listing shares on the stock market.

 

WeWork called the cuts "necessary" in order to "create a more efficient organisation".

 

The company lost nearly $1bn (£775m) in the first half of the year and had faced questions about its finances and governance.

 

Co-founder Adam Neumann stepped down as chief executive this autumn. Under his leadership, the firm had invested in projects of personal interest, including a school and a firm that makes artificial waves.

 

WeWork's new bosses had warned staff last month to expect cuts as the firm refocused on its "core" business of renting office space.

 

"As part of our renewed focus on the core WeWork business, and as we have previously shared with employees, the company is making necessary layoffs to create a more efficient organisation," WeWork said in a statement.

 

WeWork said the reductions began "weeks ago" overseas and are now affecting the US. Globally, about 2,400 people are affected.

 

WeWork, which rents office space to freelancers and businesses, expanded rapidly from a single office in New York to more than 500 locations around the world. It had about 12,500 employees at the end of June.

 

Softbank, WeWork's biggest backer, valued it at nearly $47bn at the start of the year, but the Japanese investment company has since been forced write down that figure to about $8bn.

 

The drop helped to drive Softbank to its first quarterly loss in 14 years and prompted chief executive Masayoshi Son to say that his "judgement around WeWork was not right in many ways".--BBC

 

 

 

Labour eyes 'radical' plan for companies

Labour's manifesto is one of the most radical proposed overhauls of the way companies are owned and run in decades.

 

Plans to nationalise the big six energy firms, the national energy grid, the rail and water industries, the Royal Mail and the broadband arm of BT would mark the biggest ownership grab by the state since the nationalisations that occurred after the outbreak of World War Two.

 

Those companies that Labour does not want to own and operate will also face a corporate governance revolution.

 

Shadow chancellor John McDonnell has previously said that the group with the longest-term stake in a company is usually the workers and yet their involvement in decision-making was limited.

 

Labour vows to 'transform' UK at manifesto launch

What is in the Labour Party manifesto?

Labour's big-state, big-spend transformation plan

Under Labour's plan, employees will make up one-third of reformed company boards and have an enhanced share of company profits through an Inclusive Ownership Fund, into which listed companies will transfer 1% of their shares every year for the next 10 years.

 

Any dividends on these shares derived from UK earnings will be distributed to workers, subject to a cap of £500 a year, with any additional dividends directed to a fund to train green apprenticeships.

 

This is a less radical proposal than the original plan to take ownership of 10% of any UK-listed company, meaning UK employees (and, above the cap, the government) would have a claim on 10% of the companies' worldwide earnings. For companies such as HSBC and Shell, that could have run to many billions.

 

Labour will exempt those companies who already have an employee profit-sharing scheme which delivers similar benefits to those above.

 

It seems that Labour is hoping the threat of state expropriation of shares on behalf of the workers will act as a stick to encourage companies to set up their own employee ownership schemes.

 

Windfall tax

The oil and gas industry will fund an £11bn scheme to retrain workers in the North Sea for jobs in lower-carbon-intensive industries.

 

This has angered some union representatives in Scotland, who fear it will accelerate job losses in an already dwindling North Sea oil industry.

 

How this windfall tax will be designed and applied will be the subject of a consultation and Labour has promised that oil and gas workers will not be "hung out to dry".

 

People who start their own business have enjoyed preferential tax treatment in the past. That will go.

 

The existing entrepreneurs' relief, which imposes a tax of just 10% on the capital gain when you sell a business you started, instead of 28% on other capital gains, will be abolished.

 

Along with bringing the capital gains rate into line with a person's marginal rate of income tax, that means many entrepreneurs could face a five-fold increase in the tax they pay on any business they sell.

 

Will that demotivate people from starting their own business?

 

Possibly. Although I don't know many entrepreneurs who started a business simply to take advantage of entrepreneurs' tax relief.

 

Corporation tax

The increase in corporation tax from 19% to 26%, staggered over the next three years, is the largest source of new money for Labour, and yet I suspect it will not cause the biggest howls of outrage.

 

After all, 19% is one of the lowest rates in the EU and there was no real clamour on the part of business for it to carry on falling to the previous government's target of 17%.

 

Indeed, the Conservatives abandoned that plan themselves on Monday.

 

The real howl from business will come from the cumulative effect this raft of proposals will have:

 

Scrapping corporate tax reliefs and incentives for R&D funding

A sharper rise in the living wage than proposed by the Tories

A ramp-up in corporation tax and levies on financial transactions - a tool that many businesses use to insure themselves against moves in foreign exchange or interest rates.

Above all, the concerns of business are ideological as much as practical. This is a manifesto which seems to say that business can't be trusted to do the right thing and run itself in the interests of other stakeholders apart from its owners.

 

Collectively, the proposals represent an attempt to drive rewards away from capital owners towards the workers.

 

The Labour Party will tell you that business only has itself to blame that this is necessary.

 

It describes its own proposals as "radical". That's one thing business will have no problem agreeing with.--BBC

 

 

 

Apple 'loses money on phone repairs'

In September, Apple was sent a list of questions by a US House Judiciary Committee, which is investigating "competition in digital markets".

 

In response to a question about how much the company earns from repair services, Apple said: "For each year since 2009, the costs of providing repair services has exceeded the revenue generated by repairs."

 

The company currently charges £326.44 to replace the screen on its new iPhone 11 Pro Max, and £596.44 for other repairs on the device, if it is out of warranty and the customer has not bought the AppleCare+ protection plan.

 

It charges £152.44 to replace the screen on an out-of-warranty iPhone 8.

 

Prices at unofficial repair shops vary, but are usually significantly cheaper than an official repair.

 

The BBC found third parties retailers that would replace an iPhone 8 screen for between £50 and £90.

 

Responding to the US committee, Apple said: "Repairs performed by untrained technicians might not follow proper safety and repair procedures and could result in improper function, product quality issues or safety events."

 

Asked whether it took any action to block consumers from seeking an unauthorised repair, the company said: "Apple does not take any actions to block consumers from seeking out or using repair shops that offer a broader range of repairs than those offered by Apple's authorised technicians."

 

Apple told the BBC it had nothing to add to its written answers to the committee.

 

Maps

Apple also answered questions about the Maps app, which is pre-installed on its iPhone and iPad devices.

 

In 2012, the company was criticised for removing Google Maps as its default navigation app. Many customers said Apple Maps had launched before it was ready.

 

In its answers to the committee, Apple said it had invested "billions of dollars" in its map software.

 

It suggested the reason it decided to develop its own Maps app was to give customers more control over their privacy.--BBC

 

 

 

BA passengers face delays after 'technical issue'

Dozens of British Airways flights into the UK have been delayed or cancelled after what the airline has described as a "technical issue".

 

Flights from the US, India and Japan were showing up as delayed.

 

"Our teams are working hard to resolve a technical issue which is affecting some of our flights," BA said on Twitter, in response to a passenger who had been delayed.

 

Some people have been put up in hotels and booked on other flights, it said.

 

A spokesperson for Gatwick Airport, where a number of BA flights have arrived late, blamed the delays on an issue with the airline's system for handling flight plans.

 

They said the problem caused delays of around three hours for some long-haul flights arriving into the airport, which had a knock-on effect on departures.

 

The worst affected was Flight BA170 from Pittsburgh, in the US, which was more than 12 hours behind schedule.

 

It is the latest technical issue to affect the airline, which faced massive disruption in August when more than 100 flights were cancelled because of an IT glitch.

 

In a statement, BA said it was "very sorry for the disruption".

 

It told customers to check its website for updates and make sure their contact details were up to date.

 

British Airways was hit by its first ever pilot strike in September when flight crews walked out in a row over pay and conditions.

 

Later that month, the airline revealed the industrial action had cost it at least €137m (£121m).-BBC

 

 

 

Google to restrict political adverts worldwide

Google is extending a ban on political campaigns targeting advertising at people based on their supposed political leanings.

 

It said political groups would soon only be able to target ads based on "general categories" such as age, gender and rough location.

 

This restriction is already in place in the UK and the rest of the EU but will be imposed worldwide on 6 January 2020.

 

That could have big implications for next year's US Presidential vote.

 

The firm said it would also clarify under what circumstances it would remove political ads for making "false claims".

 

For example, Google would remove ads that falsely claimed that a candidate had died or that gave the wrong date for an election.

 

However, it would not ban claims that you cannot trust a rival party, for instance, which would be viewed as being a matter of opinion.

 

A spokeswoman told the BBC the new guidance would be provided within a week.

 

Google's approach to deliberately misleading statements puts it at odds with Facebook.

 

Mark Zuckerberg said his social network would not fact-check advertising from political candidates or campaigns, although it has since stressed that this does not amount to a totally hand-off approach.

 

"We prohibit misinformation about voting and do not allow ads which contain content previously debunked by our third party fact-checkers," said a spokesman.

 

"As we've said, we are looking at different ways we might refine our approach to political ads."

 

Twitter, meanwhile, has said it would disallow political advertising altogether.

 

Google’s new policy puts it somewhere roughly in the middle, suggesting a hands-off approach, with only the the most obvious misinformation being acted upon.

 

“We recognise that robust political dialogue is an important part of democracy, and no one can sensibly adjudicate every political claim, counterclaim, and insinuation,” said Scott Spencer, Google’s head of product management for Google Ads.

 

"So we expect that the number of political ads on which we take action will be very limited - but we will continue to do so for clear violations.”

 

The databases explained

A decision to impose a global ban on political campaigns matching their own databases of prospective voters against Google's user base is set to have major ramifications ahead of next year's US Presidential election.

 

Until now, strategists could use this to target individuals across platforms such as YouTube and Google Search.

 

Based on a user’s browsing habits - such as what news websites they frequent - Google makes an assumption about whether that user has left- or right-leaning political views.

 

In the US - but not in other countries, including the UK - political campaigns had the option to target people based on their political leaning.

 

It was however possible for campaigns in other countries to upload their own lists of contact details - a database of party members, for example - to Google, which would then match it with users on its service so ads could reach those people directly.

 

This will no longer be allowed.

 

"It will take some time to implement these changes,” Mr Spencer added.

 

Campaigns, like any other advertiser, can still place ads against specific types of content - such as videos about football or articles on the economy - Google said.

 

Who is spending money to get you to vote?

'Defining what is political advertising is hard'

Online election ads - who is targeting whom?

Any action taken against advertising deemed to be against its polices will be logged on Google’s Transparency Report section.

 

Details about deleted ads will appear on the page, but not the advertisement itself. Google said this data would remain downloadable so it could be independently analysed.

 

Political advertising makes up a relatively small amount of Google’s total advertising revenues, which totalled $116bn in 2018.

 

Since March 2019, for example, Google’s figures suggest just £171,250 has been spent on political advertising ads within the UK.

 

In the US, campaigns have spent $128m on Google ads since the firm started publishing data on the region in May 2018.

 

The biggest spender, the “Trump Make America Great Again Committee”, has spent $8.5m on Google since that date.

 

Update 21 November: This article has been changed to reflect the fact in the UK and EU, Google already prevents political parties from targeting ads to users' based on their political views. The original version was based on a blog from the company that incorrectly suggested it would only begin enforcing the rule in the UK within a week and the EU by the end of the year.--BBC

 

 

Government borrowing in October highest since 2014

Government borrowing in October rose to its highest level in five years, official data shows.

 

The Office for National Statistics (ONS) said borrowing last month hit £11.2bn, £2.3bn more than last year.

 

That is much higher than economists had expected and it is likely to rise again after the election, with all major parties making costly spending pledges.

 

Total borrowing this financial year, which runs from April, is £46.3bn, over 10% higher than the same time in 2018.

 

In October, central government borrowed £7.6bn and local governments added another £1bn to the total.

 

The Bank of England, meanwhile, borrowed £2.5bn and another £100m was borrowed to cover pension costs.

 

Debt climbed by £32.1bn to £1,798.5bn, or 80.4% of gross domestic product.

 

Prime Minister Boris Johnson's Conservative Party and the opposition Labour Party have promised big increases in spending on health, schools, police and infrastructure ahead of a general election on December 12.

 

In September, Chancellor Sajid Javid announced the biggest increase in day-to-day spending in 15 years and Labour has said it wants to nationalise energy companies and other utilities.

 

Both parties have also promised to put more money into infrastructure if they win the election next month.

 

As the major parties lay out their spending and tax ambitions, there is a new blow for the next chancellor, with a reminder that the cupboard is pretty bare.

 

Figures from the Office for National Statistics show that the last month was the worst for government borrowing in five years, with a deficit of £11.2bn - up by more than £2bn on a year ago.

 

That increase was down to an increase in goods and staff spending - perhaps due to Brexit preparations. This leaves the whole year deficit on track to rise for the first time in a decade.

 

Crucially, the rise in borrowing in recent months risks wiping out the surplus on the current (day-to-day) account which was £5bn last year.

 

So any party which targets balancing the books on that score will have to raise taxes/cut spending to offset any giveaways.

 

Think tank The Resolution Foundation has said those promises would see public spending grow to its highest level since the 1970s, under either Labour or the Conservatives.

 

'Sobering'

James Smith, research director for the body, said: "The 2019 public finances deterioration provides a sobering backdrop to manifesto launches this week, alongside a wider weaker outlook for both domestic and global growth next year.

 

"With all main parties committed to balancing the books on current spending, this deterioration should be a reminder to whoever wins the election that the state of the public finances will continue to be a constraint on plans for higher public service spending or tax cuts in the next parliament."

 

Labour has said it would fund some of the increased spending through higher income tax on the top 5% of earners - who already pay half of all income tax - as well as reversing cuts in corporation tax made since 2010.

 

Mr Johnson, meanwhile, has said he will not go ahead with a planned further cut in corporation tax, but he does intend to reduce workers' social security contributions.

 

Corporation tax revenues fell 6.2% in October, the biggest fall for that month in four years.

 

But overall tax revenues have increased by 2.4% so far this year - driven by a big rise in staff costs and higher spending on other goods and services.

 

'Mixed news'

"Today's data contained mixed news on the public finances," said John Hawksworth, chief economist at PwC.

 

"On the one hand," he said, "borrowing in October was £2.3bn more than in the same month last year.

 

"On the other hand, estimates of borrowing in the six months from April to September have been revised down by £5.2bn, reflecting lower estimated government spending."

 

He added: "The net effect of these changes is favourable, with public borrowing in the financial year to date up only £4.3bn compared to the same period last year, rather than an estimated overshoot of just over £7bn in last month's original data."--BBC

 

 

General election 2019: How do government finances work?

In the run-up to the 2019 general election, political parties have been setting out their plans for the country.

 

Some have been promising to borrow lots of money to fund them. So how does it work when a government wants to borrow, and when does it have to pay it back?

 

Why does a government borrow money?

The government borrows because it spends more than it receives in revenue, which comes mainly from taxes.

 

It could, in theory, cover all of its spending from taxes - and in some years that has happened.

 

But governments have not always been willing to increase taxes enough to cover its spending, partly for political reasons - it would be unpopular with voters.

 

It's also down to economic reasons - if people have less to spend, it is bad for economic growth and jobs.

 

How much does the government borrow?

The amount the government borrows to make up the difference between what it spends and what it collects is known as "public sector net borrowing". It's also often referred to as "the deficit".

 

The government has borrowed £46.3bn so far this financial year, from April to October, according to the Office for National Statistics (ONS).

 

That's 10% more than the same period in 2018, and equates to about £656 per person in the UK.

 

The big increase in the deficit after the 2008 financial crash was caused by an increase in government spending, and a fall in how much it was receiving in taxes.

 

How does the government borrow money?

The government borrows this money in financial markets, by selling bonds.

 

A bond is a promise to make payments to whoever holds it on certain dates. There is a large payment on the final date - in effect the repayment.

 

Interest is also paid to whoever owns the bond in the meantime. So it's basically an interest-paying "IOU".

 

The buyers of these bonds, or "gilts", are mainly financial institutions, like pension funds, investment funds, banks and insurance companies. Private savers also buy some.

 

The appeal to the investors is that British government bonds are seen as essentially no risk - there is no risk that the money won't be paid. You won't lose your money and you know precisely when and how much the payments will be.

 

When does it have to be paid back?

It varies a lot.

 

Some government borrowing has to be repaid in a month, but some lending is for as long as 30 years.

 

The minimum repayment period is just one day, while some bonds have been issued for 55 years.

 

What is the difference between the government deficit and debt?

The deficit is the amount by which the government's income falls short of what it spends each year.

 

It covers most of this gap by borrowing, or sometimes by selling assets like property.

 

In years when a government spends less than its income, it's known as a surplus.

 

The deficit is not to be confused with debt, although both are linked.

 

Debt rises when there is a deficit, and falls in those years when there is a surplus.

 

Debt is the total amount of money owed by the government that has built up over years.

 

So it's a much larger sum. The debt owed by the UK government climbed by £32.1bn to £1,798.5bn between October 2018 and 2019, says the ONS.

 

The government does repay debt on the due date, but usually has to borrow new money anyway.--BBC

 

 

 

 

 

 

 

 


 

 


 

INVESTORS DIARY 2019

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


Bindura Nickel Corporation

 

 

 


Padenga Holdings

 

 

 


Delta Corporation

 

 

 


Meikles Limited

 

 

 


 <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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