Major International Business Headlines Brief::: 14 April 2020

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Major International Business Headlines Brief::: 14 April 2020

 


 

 


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

 


 

 


 

 

ü  China in the driver's seat amid calls for Africa debt relief

ü  Shell lifts force majeure on Nigeria's Forcados crude - statement

ü  Sibanye-Stillwater says it can resume limited mining in South Africa

ü  China says willing to study African debt relief jointly with
international community

ü  Oil prices edge higher after output cut, but demand worries weigh

ü  African Union appoints ex-Credit Suisse boss as envoy for virus support

ü  Bosses of South Africa's Vodacom, Absa donate some pay to coronavirus
relief

ü  Sudan to purchase 200,000 T wheat in deal with world food programme

ü  Glencore copper mine in Congo sends 350 contractors home

ü  Egypt postpones Banque du Caire stake sale due to coronavirus -chairman

ü  MPs summon China-owned firm execs over security concerns

ü  Coronavirus: Amazon plans hiring spree as orders surge

ü  Gyms face legal action over rent

ü  Softbank fund warns of $16.7bn loss due to virus

ü  World Bank warns South Asia's economic growth to slump

ü  Coronavirus: Ask-a-friend cash access scheme extended

 

 

 


 <mailto:info at bulls.co.zw> 

 


China in the driver's seat amid calls for Africa debt relief

JOHANNESBURG/BEIJING/WASHINGTON (Reuters) - Support is growing for debt
relief to help the world’s poorest, indebted nations - most of them in
Africa - confront the economic havoc wreaked by COVID-19. But there is one
big question mark: China.

 

A two-decade lending spree has propelled China to the top of Africa’s
creditor list and any comprehensive debt deal, including write-offs, would
require Beijing to take a leading role and swallow losses, analysts say.

 

“China is in the driver’s seat,” said Scott Morris, a senior fellow at the
Center for Global Development (CGD), a Washington think-tank. “But this is
going to require real pain for creditors, and I’m not sure they’ve come to
terms with that.”

 

Beijing is likely to endorse a temporary freeze on debt payments by African
countries as part of an expected agreement by the Group of 20 (G20) major
economies this week, two sources familiar with the process told Reuters.

 

Broader debt relief is the obvious next step but China is unlikely to lead
that charge, analysts say, despite the potential opportunity to burnish its
soft power credentials.

 

“The origin of Africa’s debt problem is complex, and the debt profile of
each country varies,” China’s foreign ministry said in a response to
Reuters’ questions.

 

“We are aware that some countries and international organisations have
called for debt relief programmes for African countries, and we are willing
to study the possibility of it jointly with the international community.”

 

“A RISING POWER”

Unlike major Western countries that granted debt relief in the past, a large
part of China’s debt to Africa carries commercial terms. And China itself is
still an emerging economy with per capita income of $10,153 in 2019, below
the average of $45,447 for the top seven major economies, according to data
from the International Monetary Fund (IMF).

 

“China is still a rising power, and it is only a recent ... entrant as a
major financial partner in Africa,” said Yunnan Chen of the Overseas
Development Institute (ODI), a London think-tank.

 

“It also needs to make financial and economic returns on its investments. We
are very unlikely to see direct loan forgiveness for a substantial bulk of
loans.”

 

With its own economy expected to contract for the first time in three
decades, China has signalled little appetite to go beyond its well-worn
playbook of bilateral negotiations with debt-distressed partners.

 

“We can’t answer to every debt relief request without detailed analysis,”
said He Haifeng, director of the Institute of Financial Policy at the
Chinese Academy of Social Science, a government think tank.

 

“Some of the requests could cause moral hazard.”

 

Wealthy governments watching their own economies lurch towards recession are
unlikely to pour significant resources into debt relief if they think the
money will indirectly support Chinese creditors, analysts say.

 

With around 12,500 COVID-19 cases to date, Africa accounts for a small
fraction of the more than 1.7 million infections globally.

 

Nonetheless African countries have taken a disproportionate hit due to
plummeting oil and commodity prices and weaker currencies, which ramp up
external debt servicing costs.

 

Their economies are expected to contract sharply this year and could lose 20
million jobs.

 

As an immediate step, the IMF and World Bank are pushing for a payment
moratorium on bilateral debt owed by the world’s poorest countries.

 

Last week, IMF chief Kristalina Georgieva said China was “constructively”
engaging on the issue. A Chinese official told Reuters that Beijing was
willing to work with borrowers on a bilateral basis and agreed some
countries should not be forced to service debt during the crisis.

 

The IMF is not currently pushing for a broader initiative, but experts say a
payment freeze is a first step towards that.

 

NO GRAND GESTURES

African finance ministers are calling for a $100 billion stimulus package,
of which $44 billion would come from not servicing debt - bilateral,
multilateral or commercial. They want some debt owed by Africa’s poorest
nations cancelled and the remainder converted into long-term, low-interest
loans.

 

That’s a big ask, say experts.

 

China’s government, banks and companies lent some $143 billion to Africa
between 2000-2017, much of it for large-scale infrastructure projects,
according to data from Johns Hopkins University. By some estimates, Chinese
lending now dwarfs World Bank loans in Africa.

 

The ODI estimates lending from China makes up 33% of external debt service
in Kenya, 17% in Ethiopia and 10% in Nigeria.

 

Terms of Chinese lending have generally been favourable, though a CGD study
found they were consistently harder than World Bank terms, particularly for
the poorest countries.

 

Chinese institutions offered fewer grants; grace periods on loans were
shorter, and the weighted mean interest rate was higher - 4.14% compared to
the World Bank’s 2.1%.

 

Beijing has long rejected criticism, notably from Washington, of its lending
policies.

 

“For a long time, China, in a responsible manner, has carried out investment
and financing cooperation with African countries based on their willingness
and needs,” the Chinese foreign ministry statement said.

 

While China has played a highly publicised role in Africa’s fight against
the pandemic - with billionaire Jack Ma dispatching planeloads of medical
equipment - there’s little indication of a similar grand gesture on debt.

 

Beijing has a history of working with struggling borrowers, but the process
often aims to ease short-term pressure to ensure eventual repayment.

 

The New York-based Rhodium Group research firm, analysing recent
negotiations between China and its borrowers, found debt forgiveness was
relatively common, though the sums involved were often small and paired with
substantial additional lending.

 

In Sudan, for example, China wrote off $160 million in 2017, 2.5% of the
estimated $6.5 billion it was owed.

 

Ghana’s finance minister Ken Ofori-Atta said last week that China needed to
do more. A foreign ministry spokesman said China would engage its partners
individually.

 

Experts say China’s ad hoc approach cannot work in the current crisis but a
coordinated initiative involving all creditors would require Beijing to open
its books, something it has repeatedly resisted.

 

The Trump administration has in the past signalled reluctance to support
broad debt relief, given Africa’s heavy borrowing from China.

 

U.S. officials did not respond to a request for comment.

 

Washington’s current absence from the conversation has left a leadership
vacuum. But analysts say it may bristle at any process over which it deems
Beijing to have too much influence.

 

“I worry that even if China sees this as an opportunity to seize leadership
and exploit it, the U.S. could walk away from it,” the CGD’s Morris said.

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

Shell lifts force majeure on Nigeria's Forcados crude - statement

LAGOS (Reuters) - Shell lifted a force majeure on exports of Nigeria’s
Forcados crude oil after the pipeline transporting it reopened, the company
said in a statement on Monday.

 

The removal of force majeure followed the reopening of the Trans Forcados
pipeline by operator Heritage Energy Operational Services Limited, a
spokeswoman for the Shell Petroleum Development Company of Nigeria said on
Monday.

 

The pipeline was shut down on April 4, Shell said in a previous statement.
It declared force majeure on April 6.

 

Forcados exports were set at roughly 245,000 barrels per day (bpd) in May
and 283,000 bpd in April.

 

 

 

Sibanye-Stillwater says it can resume limited mining in South Africa

JOHANNESBURG (Reuters) - Sibanye-Stillwater said on Monday it could restart
limited mining at its South African operations after a nationwide lockdown
to stem the spread of the coronavirus brought the mining industry to a
standstill.

 

The company said the South African government had given it approval for
limited mining and processing from April 14, the first sign restrictions on
one the country’s most critical industries could be eased.

 

Sibanye-Stillwater, like other miners, placed its operations in South Africa
on care and maintenance, meaning they are kept in a condition to reopen in
future, in March when a three-week lockdown was announced. This was
subsequently extended for a further two weeks, until the end of April.

 

“Approval for limited mining and processing at the SA operations has... been
received, subject to the implementation of agreed protocols to address
COVID-19 related health and safety risks,” the miner said in a statement,
without elaborating.

 

Sibanye-Stillwater previously said the closure would impact its production
guidance, and along with other top platinum producers declared a force
majeure on contracts.

 

It added on Monday that its board and executive management would donate one
third of their salary to coronavirus relief efforts for the next three
months, joining the leadership of other major companies in heeding a call
for this from President Cyril Ramaphosa.

 

 

 

China says willing to study African debt relief jointly with international
community

BEIJING (Reuters) - China said on Monday it is aware of calls for a debt
relief program for African countries, and is willing to study the
possibility with the international community.

 

China’s Ministry of Foreign Affairs made the comments via a fax sent to
Reuters on Monday in response to questions on China’s plans for debt held by
African countries amid the coronavirus pandemic.

 

Reuters reported earlier that Beijing is likely to endorse a temporary
freeze on debt payments by African countries as part of an expected
agreement by the Group of 20 (G20) major economies this week.

 

 

 

Oil prices edge higher after output cut, but demand worries weigh

LONDON (Reuters) - Oil prices edged higher on Monday in a muted response to
a global deal on record output cuts amid concerns over whether the pact will
head off an oil glut as the coronavirus pandemic hammers demand.

 

The OPEC+ group of oil producers, comprising the Organization of the
Petroleum Exporting Countries, Russia and other countries, agreed at the
weekend to cut output by 9.7 million barrels per day (bpd) in May and June,
representing about 10% of global supply.

 

Saudi Energy Minister Prince Abdulaziz bin Salman said nations in the G20
group had pledged to cut about 3.7 million bpd and that strategic reserves
purchases would reach roughly 200 million barrels over the next couple of
months, bringing the total reduction to about 19.5 million bpd.

 

Brent crude futures were up 53 cents, or 1.7%, at $32.01 a barrel by 1413
GMT, having opened at a session high of $33.99. U.S. West Texas Intermediate
(WTI) crude was up 86 cents, or 3.8%, at $23.62, having earlier hit $24.74.

 

U.S. President Donald Trump praised the oil supply deal, the possibility of
which he had first touted on April 2.

 

Saudi Arabia, Kuwait and the United Arab Emirates volunteered to make cuts
even deeper than those agreed, which would effectively bring down OPEC+
supply by 12.5 million bpd from current levels.

 

Saudi Arabia on Monday set its May official selling prices (OSP) for crude,
selling oil to Asia more cheaply and keeping prices flat for Europe while
raising them for the United States.

 

Meanwhile, analysts cast doubts on producers’ likely compliance with the
production cuts, not least since Mexico got off with smaller cuts than
initially demanded.

 

Even factoring in full compliance, concern over demand weakness served to
keep a lid on oil price gains.

 

“If ... indications that G20 will join in with more cuts of up to an
additional 10 million bpd prove true and take an official character, then we
can expect a relative price recovery,” Rystad energy analysts said.

 

“Still, due to the stock build that April will have accumulated by then,
prices will not recover this year to pre-COVID-19 levels.”

 

Worldwide fuel consumption is down roughly 30% because of the COVID-19
pandemic that has killed more than 100,000 people worldwide and kept entire
nations on lockdown.

 

“We do not expect a sustained recovery in the oil price until pent-up demand
is released in Q3,” said Harry Tchilinguirian of BNP Paribas.

 

    Outside of OPEC+, Canada has signalled a willingness to cut and Norway
said it would decide about its cut “in the near future”.

 

The United States, where antitrust legislation makes it hard to act in
tandem with groups such as OPEC, has said that low prices mean its output
would already fall by as much as 2 million bpd this year without planned
cuts.

 

Brent’s contango - the market structure in which later-dated prices are
higher than prompt supplies - widened, highlighting some optimism over the
longer-term impact of the OPEC+ cuts but also current oversupply concerns.

 

“The fundamentals still look incredibly bearish for the weeks and months
ahead and imply time spreads should fall into deeper contango from current
levels,” FGE analysts said.

 

Citi analysts raised their Brent price forecasts for the third and fourth
quarters to $35 and $45 a barrel respectively.

 

Morgan Stanley has also raised its forecasts by $5 for the second half of
the year to between $30 and $35 a barrel.

 

 

 

African Union appoints ex-Credit Suisse boss as envoy for virus support

JOHANNESBURG (Reuters) - The African Union (AU) has appointed former Credit
Suisse boss Tidjane Thiam and several other dignitaries as a special envoys
to solicit international support to help the continent deal with the
economic impact of the coronavirus.

 

The envoy team, which was named by the AU chairman, South African President
Cyril Ramaphosa, also includes former Nigerian Finance Minister Ngozi
Okonjo-Iweala, former South African Finance Minister Trevor Manuel, and
Donald Kaberuka, former president and chairman of the African Development
Bank.

 

Manuel is now chairman of insurer Old Mutual. Ivory Coast-born banker Thiam
left Credit Suisse in February this year after a scandal over the
surveillance of another executive.

 

The envoys will be tasked with “soliciting rapid and concrete support”
pledged by the G20, the European Union and other financial institutions, the
AU said in a statement.

 

“These institutions need to support African economies that are facing
serious economic challenges with a comprehensive stimulus package for
Africa, including deferred debt and interest payments,” Ramaphosa was quoted
as saying.

 

Thiam is one of several prominent Africans who has called for a standstill
on debt to private creditors amid the outbreak of coronavirus, which
threatens many African economies already facing headwinds from factors such
as plummeting oil prices.

 

In just two years from 2015 to 2017, African external debt payments doubled
from an average of 5.9% of government revenue to 11.8%. At 32%, the
proportion of debt owed to private lenders is almost equal to the 35% owed
to multilateral institutions.

 

Private creditors include Thiam’s former employer Credit Suisse, which is
currently fighting Mozambique in court over a $622 million loan.

 

 

 

Bosses of South Africa's Vodacom, Absa donate some pay to coronavirus relief

JOHANNESBURG (Reuters) - The bosses of South Africa’s Vodacom and lender
Absa will donate a third of their salary for the next three months to a
support fund set up in response to the coronavirus outbreak, the company
said on Sunday.

 

Shameel Joosub, Vodacom chief executive, and Daniel Mminele, Absa chief
executive, join the heads of other major companies, including lenders
FirstRand and Nedbank, in heeding calls from President Cyril Ramaphosa for
others to follow the government’s lead.

 

Ramaphosa earlier said top officials’ salaries would be cut by the same
amount for the same period. At Absa, chief financial officer Jason Quinn and
a number of other top executives will also donate the same portion of their
salaries.

 

Joosub received 11.5 million rand ($630,000) in base pay and benefits in
2019, according to the company’s annual report. Mminele only took the helm
at Absa earlier this year and there is no information about his pay
currently available.

 

Another South African lender, Standard Bank, said on Saturday a mechanism
would be set up to allow its leaders and executives to make voluntary
donations to the fund.

 

($1 = 18.1978 rand)

 

 

 

Sudan to purchase 200,000 T wheat in deal with world food programme

KHARTOUM (Reuters) - Sudan’s government will purchase 200,000 tonnes of
wheat in a deal with the United Nations’ world food programme, the finance
ministry said on Monday, in a bid to bolster strategic reserves amid the
coronavirus pandemic.

 

Sudan, which faces an acute foreign currency shortage, will pay for the
wheat in Sudanese pounds, saving more than $50 million for its reserves, the
ministry said.

 

The government subsidises flour, paying 75% of the cost of each bag to
millers, to allow bakers to fix the price of each loaf. Bakers, however,
have complained and threatened to go on strike over rising operating costs
and the steady weakening of the Sudanese pound.

 

Bread shortages, caused by difficulties in raising hard currency to import
wheat, triggered mass protests which - with the help of the military -
toppled former President Omar al-Bashir last year after three decades in
power.

 

 

 

Glencore copper mine in Congo sends 350 contractors home

DAKAR/JOHANNESBURG (Reuters) - Glencore’s Katanga Mining sent 350 workers to
be repatriated this week after the copper and cobalt miner delayed the
commissioning of an acid plant they were working on in Democratic Republic
of Congo’s Lualaba province.

 

Katanga Mining’s 75%-owned subsidiary Kamoto Copper Co (KCC) had sent the
350 Indian contractors from the mine site near Kolwezi to Lubumbashi,
capital of Haut-Katanga province, to be repatriated, a source at KCC told
Reuters.

 

They are awaiting flights back to India.

 

Haut-Katanga governor Jacques Kyabula Katwe told Reuters: “There are about
300 Indians in Lubumbashi, they came from Kolwezi and are waiting for a
plane to India”.

 

He added he thought they came from KCC. “If it is not possible for them to
go back to India next week I will send them back to Kolwezi,” the governor
added.

 

A Glencore spokesman declined comment.

 

Katanga Mining, which is 99.5% owned by Glencore, said on March 30 the
commissioning of its acid plant at KCC had been delayed as travel
restrictions due to the COVID-19 pandemic made it impossible to bring
commissioning experts to the site.

 

It said the acid plant was expected to be commissioned in the second half of
2020 rather than the first half.

 

KCC had on March 23 repatriated 26 foreign workers in response to the
COVID-19 outbreak.

 

 

 

 

Egypt postpones Banque du Caire stake sale due to coronavirus -chairman

CAIRO (Reuters) - Egypt has postponed its plans to sell a minority stake in
state-owned Banque du Caire in an initial public offering (IPO) starting
mid-April due to the spread of the coronavirus, a local newspaper on Sunday
quoted the bank chairman as saying.

 

Chairman Tarek Fayed had told Reuters in March that the plan remained to
sell the stake, worth about $500 million, provided investor interest held up
in the face of the virus.

 

“Plans to offer a share of the bank on the Egyptian Stock Exchange are
currently deferred due to the spread of the new coronavirus globally and
locally, and the impact on both local and global stock markets,” Fayed told
the private Almasry Alyoum newspaper in an interview published on Sunday.

 

He provided no further detail.

 

The sale would be Egypt’s biggest sale of state assets since 2006.

 

The bank is part of a revived privatisation programme involving a long list
of state companies which was announced three years ago but which has faced
repeated delays.

 

 

 

MPs summon China-owned firm execs over security concerns

A leading UK-based firm will be summoned on Tuesday by MPs to answer
questions over security concerns.

 

There are concerns that the Chinese owner of Imagination Technologies has
renewed efforts to transfer ownership of sensitive security software to
companies controlled by China.

 

Lawmakers worry the coronavirus crisis is diverting attention from
controversial technology transfers.

 

The fear is that networks in the UK, Europe and the US could be compromised.

 

Speaking to the BBC, Tom Tugendhat, the chair of the Foreign Affairs Select
Committee said he was concerned that technology developed by Imagination
Technologies, based in Hertfordshire, could be used to fine tune the design
of so-called "backdoors" into strategically important digital
infrastructure.

 

"The world has changed and companies - particularly tech companies - are on
the frontline," said Mr Tugendhat.

 

"Whoever writes the code, writes the rules for the world, more than any
regulation passed by bureaucrats. There's no point in taking back control
from Brussels, only to hand it over to Beijing."

 

Imagination Technologies was acquired by a US-based but Chinese state-owned
investment firm called Canyon Bridge in September 2017, which is in turn
owned by a Chinese state-owned investment fund called China Reform.

 

Mr Tugendhat said Theresa May's government approved the acquisition on the
basis that Canyon Bridge was licensed and regulated by US law.

 

Since then it has moved its headquarters to the Cayman Islands and as such
is no longer a US-controlled entity.

 

Several senior executives, including chief executive Ron Black, have stepped
down recently citing concerns about the future direction and ownership of
the company.

 

Chief product officer Steve Evans and chief technical officer John Rayfield
also resigned recently.

 

Mr Evans is understood to have said in his resignation letter: "I will not
be part of a company that is effectively controlled by the Chinese
government."

 

An attempt by China Reform to stage a boardroom coup ten days ago by
appointing four of its own directors were aborted, but the call for evidence
comes amid renewed concerns that the Chinese owners of Imagination are
preparing a fresh attempt to transfer sensitive technology patents to
mainland China.

 

As well as designing graphics and virtual reality software for computer
chips, industry experts say that Imagination also produces software which
can detect whether any weaknesses in sensitive digital networks - so-called
"backdoors" are the result of error or intention.

 

The UK has already approved the limited use of Chinese-owned Huawei
equipment in the construction of new superfast 5G networks that promise to
deliver better connectivity for use in autonomous cars, utilities, power
stations, the national health service and many others.

 

There is no suggestion that Huawei is directly connected to Imagination, or
its ultimate owners - the state-owned China Reform investment fund.

 

The call for evidence comes a day after EU competition chief Margrethe
Vestager warned that companies across the EU - many of which have been or
are being pushed the brink of bankruptcy by the economic effects of
Coronavirus - are vulnerable to takeover from Chinese companies.

 

In the UK, the Treasury is considering plans for the state to take ownership
stakes in thousands of businesses, to prevent mass bankruptcies of
businesses unable or unwilling to take on extra debt.

 

The situation is delicate as many EU countries are gratefully accepting
donations of virus-fighting equipment from China. The country, which appears
to be "first in - first out", is now emerging from a crisis from which it
bore the initial brunt.

 

Neither Imagination Technologies, nor its owner China Reform returned the
BBC's request for comment.--BBC

 

 

 

 

Coronavirus: Amazon plans hiring spree as orders surge

Online retailing giant Amazon has urged US workers who've lost jobs because
of the coronavirus slowdown to apply for as many as 75,000 jobs it is
offering.

 

The company also said it would ease its temporary curbs on non-essential
goods being sold on its platforms.

 

Last month, Amazon took on 100,000 extra US staff to fill priority online
orders for food and medical equipment for existing customers.

 

But it still has a waiting list for new customers.

 

Amazon said it would now allow more non-essential items from third-party
sellers, who make up the majority of sales on its site.

 

"Products will be limited by quantity to enable us to continue prioritising
products and protecting employees, while also ensuring most selling partners
can ship goods into our facilities," Amazon said in a statement to the
Financial Times.

 

Amazon did not immediately respond to a BBC request for comment.

 

Millions of Americans have lost their jobs because of the coronavirus
lockdowns, with more than 16 million submitting unemployment claims.

 

On its blog about its response to the coronavirus, Amazon said that the
fresh hires - all warehouse roles - could tide over workers in sectors such
as hospitality, restaurants, and travel.

 

"We welcome anyone out of work to join us at Amazon until things return to
normal and their past employer is able to bring them back," it said.

 

Staff protests over coronavirus' protections

Amazon has faced protests from current warehouse staff over whether it has
provided adequate protection from coronavirus infections at its warehouses.

 

More than 50 Amazon locations have confirmed coronavirus cases, according to
the Financial Times.

 

In March, Amazon fired a New York warehouse worker who organised a protest
over an alleged lack of safety precautions.

 

But in the blog post, Amazon said it has made changes to work conditions
including enhanced testing, cleaning and social distancing as well as issued
protective gear and started temperature checks at operations worldwide.--BBC

 

 

 

Gyms face legal action over rent

Gym and leisure centre bosses say they face being evicted during the
coronavirus crisis over non-payment of rent.

 

Trade body UKActive said urgent action is needed to safeguard exercise
venues as unscrupulous landlords use a loophole to threaten eviction.

 

New rules to protect commercial tenants were introduced last month.

 

But they don't prevent landlords from taking steps to force tenants to pay
rent withheld because of the lockdown.

 

"A worrying number have decided to pursue statutory demand notices or
winding up orders," said Huw Edwards, chief executive of UKActive.

 

"We need the government to act now to direct...that landlords cannot do
this.

 

"With 2,800 gyms at risk of permanent closure, and 100,000 jobs at stake,
time is of the essence."

 

Section 82 of the government's Coronavirus Act 2020 came into force on 25
March to help protect commercial tenants.

 

It banned the forfeiture of commercial leases until 30 June 2020 - or longer
if the government deems necessary - for non-payment of rent.

 

However, the Act does not prevent landlords from taking certain actions,
including Commercial Rent Arrears Recovery (CRAR), making a debt claim,
issuing a statutory demand, or commencing winding-up proceedings - each of
which is lethal to businesses with no income.

 

The BBC has approached the Department for Business, Energy and Industrial
Strategy for comment.

 

The trade body says it has evidence to show a growing number of cases where
landlords are planning to instigate legal proceedings against operators.

 

UKActive said it expects the first cases to start this week and warned that
pubs, restaurants, cafes, cinemas, and retailers could face similar threats.

 

"Many of our members are faced with the harsh reality of no revenues for a
long period, so must take steps to preserve cash, including not paying their
rent for the quarter ahead," said Mr Edwards.

 

He said some landlords have engaged in constructive discussions to reduce
the pressure on tenants, however, a number have decided to pursue statutory
demand notices or winding up orders.

 

Waiver of rent

David Lloyd Leisure, which owns David Lloyd Clubs, appealed to one landlord
to request a waiver of rental payments due on 25 March 2020 until the crisis
eases and the government allows its clubs to re-open.

 

The request was refused immediately by the landlord and was instead met with
the threat of legal action through the issuing of a statutory notice.

 

"This situation is unfortunately entirely outside of our control," said
David Lloyd boss Glenn Earlham.

 

"We want to work together with landlords to ensure we can survive this
pandemic and emerge with businesses able to continue to pay rent and other
costs in the future."

 

PureGym has seen similar instances across its facilities.

 

"The burden of dealing with the economic impact of the Covid-19 pandemic
continues to fall on commercial tenants rather than being shared equitably
by landlords as well," said Humphrey Cobbold, chief executive of PureGym.

 

"Time is of the absolute essence, given that proceedings such as statutory
demands and winding up orders threaten to force companies into insolvency
within days of being issued."--BBC

 

 

 

Softbank fund warns of $16.7bn loss due to virus

SoftBank expects to lose $16.7bn (£13.3bn) on firms it has invested in
through its tech start-up fund.

 

The Japanese conglomerate is the world’s biggest technology investor through
its $100bn Vision Fund.

 

Some bad investments have seen the fund’s valuation drop substantially
leading to Softbank’s first loss in 15 years.

 

Softbank blamed the poor performance on a "deteriorating market environment"
hammered by the coronavirus pandemic.

 

The company as a whole has stakes in some high-profile tech firms and
start-ups either through the fund or via the Softbank group.

 

These include co-working office provider WeWork, satellite operator OneWeb
and US telecoms firm Sprint, which has merged with rival T-Mobile US.

 

The Vision Fund has made some large bets on start-ups including Uber, Indian
hotel chain Oyo and South-East Asia’s fast-growing ride-hailing app Grab,
along with China’s equivalent Didi Chuxing.

 

Many of these firms have suffered from the coronavirus lockdowns being
imposed across the globe. A large portion are linked to consumer spending,
travel and transportation.

 

But Softbank also has a stake in Chinese short-video firm ByteDance which
owns the popular TikTok app, which has seen a huge surge in traffic as young
people stay at home during school closures.--BBC

 

 

 

World Bank warns South Asia's economic growth to slump

South Asia faces its worst economic performance in 40 years because of the
coronavirus, the World Bank has said.

 

The effects will unravel decades of progress in the region's battle against
poverty.

 

Economies such as India, Bangladesh, Sri Lanka and Pakistan have reported
relatively few virus cases but experts fear they could be the next hotspots.

 

The South Asia region is home to 1.8 billion people and some of the world’s
most densely populated cities.

 

"South Asia finds itself in a perfect storm of adverse effects. Tourism has
dried up, supply chains have been disrupted, demand for garments has
collapsed and consumer and investor sentiments have deteriorated," said the
World Bank report.

 

It has slashed its growth forecast for the region this year to 1.8% to 2.8%
from its original projection of 6.3% made before the virus outbreak. At
least half the countries in this region could fall into "deep recession".

 

The worst hit economy will be the Maldives, a nation of small islands in the
Arabian Sea where the collapse of high-end tourism could see its economic
output shrink by as much as 13%, warned the World Bank.

 

India, the biggest economy in South Asia, could see growth of just 1.5% in
its financial year, down from a figure of around 5%, the World Bank
predicted.

 

It has advised governments to "ramp up action to curb the health emergency,
protect their people, especially the poorest and most vulnerable, and set
the stage now for fast economic recovery".

 

The World Bank also recommended temporary work programmes for migrant
workers, and debt relief for businesses and individuals while cutting red
tape on essential imports and exports.

 

Last week the Washington DC-based lender said it would deploy up to $160bn
(£128bn) in financial support over the next 15 months to help vulnerable
countries deal with the pandemic and bolster their economic recovery.--BBC

 

 

 

Coronavirus: Ask-a-friend cash access scheme extended

Anyone who cannot leave home may be able to ask a trusted friend or
volunteer to withdraw cash at any Post Office using a single-use voucher.

 

The Post Office scheme is being extended and offered to all banks, building
societies and credit unions.

 

If the bank allows it, someone can ask for a one-time barcode sent via text,
email or post for a stipulated amount.

 

A trusted friend or volunteer can exchange the voucher for the cash
requested.

 

Previously, only a named individual, such as a carer, could collect cash in
this way on someone's behalf. Now any trusted neighbour or volunteer can do
so.

 

The idea of the Payout Now scheme is to allow people who are shielded or
self-isolating, mainly elderly, to maintain access to cash without having to
hand over a debit card and Pin to somebody else.

 

They tell their bank exactly how much they want to withdraw from their
account, up to a limit set by the bank, and allow a family member, trusted
friend or volunteer to collect it on their behalf in exchange for the
voucher.

 

Martin Kearsley, banking director at the Post Office, said: "Being able to
easily access cash is a vital service for older people and those
self-isolating.

 

"[This] means they can access cash quickly and securely to repay someone for
a helpful service like shopping, or simply manage their finances, providing
peace of mind that cash can be securely sourced with the help of any trusted
helper."

 

A service that allows vulnerable customers to contact their bank and arrange
to cash a cheque at a Post Office branch is also being sped up.

 

Under the Fast PACE system, the customer should contact their bank and check
they can use the service. They would then write a cheque to "The Post
Office", print the name on the back of the cheque of the person collecting
it for them and sign that side too.

 

That individual can then collect the cash from a Post Office branch after
their ID is verified. At its fastest, the whole process from the initial
call to the cash being collected could take a day.

 

"Anyone collecting cash on behalf of another person must remember to
practise safe distancing and should consider arranging with the recipient
how the cash can be safely handed over - perhaps through a person's
letterbox, for example," Mr Kearsley added.

 

Both schemes come with a warning that people should only use friends and
volunteers who are completely trusted, they should only withdraw cash they
really need, and they should not be put under any pressure to do so.

 

There have been reports of fraudsters offering to shop for people who cannot
leave the home, but who steal any money they are given, or take money from
accounts after a Pin is handed over.--BBC

 

 

 

 

 


 

 


 

INVESTORS DIARY 2020

 


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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