Major International Business Headlines Brief::: 29 June 2020

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Major International Business Headlines Brief::: 29 June 2020

 


 

 


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ü  Sasol to sell stakes in Mozambique pipeline, power plant - sources

ü  UK Export Finance set to back Total's $20 bln Mozambique LNG project - source

ü  Botswana needs $3.4 billion in stimulus, to plug budget deficits

ü  Moody's says South Africa unlikely to stabilise debt by 2023

ü  Kenyan central banker sees silver lining in economic gloom

ü  Kenya Airways estimates coronavirus revenue loss at $100 mln -CEO

ü  Zambia sees 2020 expenditure up $1.1 bln as kwacha falls

ü  South Africa's Vodacom appoints Mdlalose as interim CFO

ü  Extra £14bn needed a year for climate, report says

ü  Starbucks suspends social media ads over hate speech

ü  Boeing set for critical 737 Max flight tests

ü  Coronavirus: UK to open up European holidays from 6 July

ü  Coronavirus: Delta to extend caps on passenger numbers

ü  Wirecard: Cardholders' money locked as FCA freezes UK subsidiary

ü  Shopping centre giant Intu enters administration

ü  Northern Ireland to launch separate contact-tracing app

 

 

 

 

 

 

 


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Sasol to sell stakes in Mozambique pipeline, power plant - sources

JOHANNESBURG (Reuters) - Struggling petrochemicals producer Sasol has appointed advisers to sell its stakes in a power plant in Mozambique and a gas pipeline running from the country into South Africa, two sources familiar with the matter told Reuters.

 

Sasol, the world’s top producer of motor fuel from coal, is trying to shed assets to pay off its debt pile and avoid a rights issue of up to $2 billion, but has not previously flagged the Mozambique assets as up for sale.

 

It has appointed South Africa’s Nedbank to manage the sale of its 50% stake in the Republic of Mozambique Pipeline Company (ROMPCO), the joint venture operating the pipeline that runs 865 kilometres from Mozambique into South Africa, the sources said.

 

“We do not comment on ongoing commercially sensitive and/or M&A processes and we do not react to market speculation,” a Sasol spokesman wrote in an email.

 

The sources said the company had also appointed Deloitte to sell its 49% stake in Central Termica de Ressano Garcia (CTRG), Mozambique’s first permanent large-scale gas power plant which, at a capacity of 175 megawatts, meets almost a quarter of the country’s energy demand, according to Sasol’s website.

 

Mozambique’s state-run National Hydrocarbon Company (ENH) and South Africa’s government-owned Central Energy Fund (CEF) each hold 25% stakes in ROMPCO.

 

ENH, CEF, and Deloitte did not immediately respond to requests for comment. Nedbank declined to comment.

 

The other 51% of CTRG is held by Mozambique’s state power utility EDM. EDM could not immediately be reached for comment.

 

As part of a business revamp, Sasol said last week it would cut jobs and exit West African oil operations.

 

 

 


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UK Export Finance set to back Total's $20 bln Mozambique LNG project - source

JOHANNESBURG/LONDON (Reuters) - Britain’s export credit agency UK Export Finance (UKEF) is set to back a $20 billion liquefied natural gas (LNG) project in Mozambique, a source with direct knowledge of the matter told Reuters on Friday.

 

UKEF listed the project, led by French energy major Total, as under consideration for financing last August. A decision to contribute will draw criticism from campaigners who have opposed such a move.

 

The source said UKEF was planning to commit funding probably to the tune of around $800 million to the project, which is among several being developed in Mozambique’s north after one of the biggest gas finds in a decade off its coast.

 

“UKEF cannot comment on speculation on potential transactions for reasons of commercial confidentiality,” a spokeswoman said.

 

The projects have the potential to make Mozambique, one of the world’s least developed countries, a major LNG player. Total and other big oil companies are touting LNG as a transition fuel as it produces fewer emissions than crude oil.

 

Campaigners however say such projects lock in harmful emissions for the foreseeable future and hurt often impoverished local communities, especially in countries with a history of corruption, like Mozambique.

 

They say they are out of step with commitments under the 2015 Paris Agreement, signed by almost 200 countries.

 

As a signatory that is trying to position itself as a leader on climate issues, activists say Britain will be sending the wrong message by funding the project.

 

“By backing this massive fossil fuel project, the UK would undermine their credibility as they prepare to host the UN climate negotiations next year,” said Alex Doukas, program director at campaign group Oil Change International.

 

“The UK should never finance another fossil fuel project if they are serious about being a climate leader.”

 

Total has secured $15 billion in financing for the project, with the financing agreement expected to be signed next week. It aims to start producing gas in 2024.

 

 

 

Botswana needs $3.4 billion in stimulus, to plug budget deficits

GABORONE (Reuters) - Botswana needs a total of 40 billion pula ($3.40 billion) over the next 2-1/2 years to revive its coronavirus-hit economy and to cover expected budget deficits, estimates by the ministry of finance showed on Friday.

 

Botswana has a relatively low number of COVID-19 infections with only three active cases remaining and one death, but the economy has been severely impacted by lockdowns to curb the outbreak with the budget deficit expected to more than double as reduced diamond sales and exports hit revenues.

 

“The estimated total cost of Economic Recovery and Transformation Plan (ERTP) spending is 20 billion pula over 2.5 years,” read a draft of the plan seen by Reuters.

 

“In addition, the anticipated budget deficit over the same period is 20 billion pula, making a total of approximately 40 billion pula to be funded,” it said.

 

Industries earmarked for investment include agriculture, health infrastructure, transport and the tourism sector which has ground to a halt due to global travel restrictions and a nationwide lockdown.

 

Funding for the economic recovery plan and the deficits is expected to be sourced mostly from domestic borrowing, drawing down on government savings, and taxes.

 

Botswana recently ended a 48-day lockdown allowing businesses and schools to reopen under strict conditions as it seeks to restart the economy.

 

($1 = 11.7509 pulas)

 

 

 

Moody's says South Africa unlikely to stabilise debt by 2023

JOHANNESBURG (Reuters) - The South African government target to stabilise its ballooning debt by 2023 will be very difficult to achieve and unlikely, ratings agency Moody’s said on Thursday.

 

The Treasury on Wednesday presented a supplementary budget in response to the coronavirus crisis that projected a wider budget deficit, while public debt was estimated to be more than three quarters of gross domestic product in the medium term.

 

“In its ‘active scenario’, the government hopes to achieve a primary surplus by fiscal 2023 that would stabilise debt,” Moody’s said in a research note on the budget.

 

“Given South Africa’s weak track record of fiscal consolidation in recent years and the weak medium-term economic outlook, debt stabilisation by 2023 will be very difficult to achieve.”

 

The economy was in recession before the COVID-19 outbreak ravaged it, and the lockdown that followed late in March has put further strain on businesses and consumers.

 

The Treasury projects the economy will contract 7.2% this year.

 

 

 

Kenyan central banker sees silver lining in economic gloom

NAIROBI (Reuters) - Kenya’s economy could fare better than expected in the face of the coronavirus crisis, thanks to growing farm exports and a recovery in remittances, the central bank governor said on Friday.

 

The economy has been battered by the coronavirus, with tourism and small and medium-size businesses hit particularly hard.

 

But tea exports, a key source of hard currency, rose 15% in May from May a year ago, the central bank governor, Patrick Njoroge, told an online news conference. Exports of flowers, fruits and vegetables grew by a third the same month.

 

“The expectation that we were going to sink so much further has not been borne by the numbers or the reality,” Njoroge said, although he cautioned that the outlook remained uncertain.

 

“We do not want to be so foolish as to say the worst is behind us,” Njoroge said, adding that the bank will review its economic growth forecast in the next two weeks.

 

Commercial banks have restructured loans worth 679.6 billion shillings ($6.39 billion), nearly a quarter of the industry total, the central bank said, underlining the extent of the damage to the economy.

 

Policymakers left interest rates unchanged on Thursday for the second time in two months, after cutting them in March and April after the first case of COVID-19 was confirmed.

 

The current account deficit could narrow from the forecast of 5.8% of gross domestic product for this year, Njoroge said.

 

Remittances — cash sent home by Kenyans living abroad — recovered to $258 million in May, he said, from $208 million in April. He said they were boosted by recoveries in major economies abroad and by more ways to send cash, including straight to the recipients’ mobile phones.

 

($1 = 106.4000 Kenyan shillings)

 

 

 

Kenya Airways estimates coronavirus revenue loss at $100 mln -CEO

NAIROBI (Reuters) - Kenya Airways has lost an estimated $100 million in revenue as a result of the coronavirus pandemic and related lockdowns, CEO Allan Kilavuka told reporters on Friday.

 

“We don’t have the full picture of how much we have lost but our estimate is since January to date we have probably lost in terms of revenue around about $100 million,” Kilavuka said.

 

“When we estimate till the end of the year we think we will lose probably between $400 and $500 million,” he said.

 

The coronavirus crisis has hit the global aviation industry hard, but Kenya Airways was struggling long before the outbreak.

 

The government has been working on a plan to renationalise the airline, which is one of the biggest on the continent, to save it from mounting debts that had been restructured in 2017 in an attempt to save the business.

 

The pandemic-led crisis has delayed that process but it is still ongoing, chairman Michael Joseph said on Friday.

 

“It has just delayed it by a few months. We wanted to be completed in August, we probably we will complete now a little bit later than that,” he told reporters.

 

 

 

Zambia sees 2020 expenditure up $1.1 bln as kwacha falls

LUSAKA (Reuters) - Zambia’s expenditure is expected to rise by approximately 20 billion kwacha ($1.11 billion) this year as the local currency weakens, piling more pressure on a nation already struggling with huge debt, President Edgar Lungu said on Thursday.

 

External debt service will rise by 8.7 billion kwacha because of a sharp fall in the currency, Lungu said in a national address.

 

Zambia has $3 billion of Eurobonds outstanding and owes $2 billion to commercial banks, $2 billion to the International Monetary Fund and World Bank, and a further $3 billion to China.

 

The kwacha has weakened more than 28% against the U.S. dollar so far this year, with the central bank in May attributing the depreciation to macroeconomic challenges associated with debt service and debt levels.

 

Economic activity in Africa’s second-largest, copper-producing nation has also been hurt by the coronavirus crisis.

 

Lungu announced the reopening of all international airports to revive tourism after closures in March hit the sector.

 

Zambia has registered 1,497 coronavirus cases and 18 deaths, Lungu said.

 

Zambia is reviewing its 2020 budget after a reduction in revenue as a result of the coronavirus pandemic and other factors, Secretary to the Treasury Fredson Yamba said.

 

Zambia’s budgeted revenue is estimated to fall short of target by close to 20% as a result of economic adjustments due to COVID-19, the ministry of finance said in April.

 

($1 = 18.0700 Zambian kwachas)

 

 

South Africa's Vodacom appoints Mdlalose as interim CFO

JOHANNESBURG (Reuters) - Vodacom Group executive director Sitho Mdlalose will be appointed interim group chief financial officer from July 1, the South African mobile operator said on Friday.

 

Mdlalose is replacing Till Streichert who is leaving the company on June 30 to pursue an external opportunity.

 

Mdlalose, 40, was appointed to the role of executive director for finance at Vodacom South Africa in 2017 having been CFO of Vodacom International Business since 2014.

 

The appointment of a permanent CFO is well advanced and an announcement is expected to be made in due course, Vodacom said in a statement.

 

 

 

Extra £14bn needed a year for climate, report says

An extra £14bn is needed each year to help the UK meet its climate commitments, a new think tank report suggests.

 

Green Alliance says the cash is needed for clean transport, nature restoration, and low-carbon buildings.

 

Over the past three years, it says that £9bn has been spent on projects that actually increase CO2, like roads.

 

It comes as large UK firms make a promise to "kick-start a new approach" and "put the environment first".

 

The Green Alliance think tank insists though that the funding issue must be solved in the prime minister’s economic recovery speech expected on Tuesday.

 

Its calculations are based on the government’s own assessment of major projects in the pipeline released on 16 June.

 

The government said it is determined to meet carbon targets, but the report draws attention to ministers' plans to spend £28bn on roads.

 

Shift cash from roads

Green Alliance says they could close 60% of the disparity between high-carbon and low-carbon spending by shifting investment from roads towards non-polluting infrastructure such as bike lanes.

 

The authors cast doubt on whether the government should spend any more money at all on projects that increase CO2 emissions.

 

Chris Venables, head of politics at Green Alliance, said of Tuesday's expected speech: "This is a once in a generation opportunity for the prime minister to create the foundations of a healthier, more resilient economy.

 

"For ‘Project Speed’ (the prime minister's infrastructure review) to be successful, it must be the most ambitious climate infrastructure project ever, creating jobs in every corner of the UK.

 

"It can’t mean a bonfire of regulations locking in polluting activities for decades to come.”

 

The report supports analysis by the the Trades Union Congress defining the best value for money from job-creating schemes. Road-building was judged poorly.

 

The calculations judge projects based on jobs created per pound of public investment.

 

Best value projects

Best value are said to be: retrofitting buildings and creating cycle lanes, which are given a score of 20.

 

Electric ferries, battery factories and reforestation score 19; decarbonising industry, new electric UK buses, 18; and upgrading railways, installing electric vehicle chargers, and environmental restoration, 17.

 

Broadband expansion scores 15, but road-building, by comparison, scores just 10.

 

In a previous interview for BBC News, AA President Edmund King endorsed the role of broadband.

 

He told BBC News: "Arguably in future, we should invest more in broadband (than new roads), because what this crisis has shown is that the majority of companies can continue working from home, and it can be more efficient."

 

Meanwhile, the government is facing legal action from a group complaining that road plans are incompatible with climate objectives.

 

Andrew Adonis, former head of the National Infrastructure Commission told BBC News: “We need to tackle bottlenecks in the road system but it is vital we promote a long-term shift to low carbon transport.

 

"The coalition agreement for the new Irish government includes a 2-1 split for all future transport capital spending to be on public transport and cycling rather than roads. We should consider doing the same in the UK.”

 

A government spokesperson said: “The prime minister has been clear that the UK should have the most ambitious environmental programme of any country on earth.

 

“The actions we are taking to achieve our zero emissions target will help to deliver a stronger, cleaner, more sustainable and more resilient economy after this pandemic – and already there are over 460,000 UK jobs in low carbon businesses and their supply chains.”

 

On Monday, more than 200 business leaders will meet with Business Secretary Alok Sharma and Environment Secretary George Eustice at a Council for Sustainable Business event.

 

FTSE 100 firms including Unilever, Standard Chartered and Direct Line will discuss measures that business can take to cut carbon emissions with ministers as they also try to deal with the fallout of the coronavirus crisis.

 

Attendees will be asked to show government that they are are keen to work with them on a "cleaner, greener, more resilient economic recovery post Covid-19".--BBC

 

 

 

Starbucks suspends social media ads over hate speech

Starbucks has announced it will suspend advertising on some social media platforms in response to hate speech.

 

The coffee giant joins global brands including Coca-Cola, Diageo and Unilever which have recently removed advertising from social platforms.

 

A Starbucks spokesperson told the BBC the social media "pause" would not include YouTube, owned by Google.

 

"We believe in bringing communities together, both in person and online," Starbucks said in a statement.

 

The brand said it would "have discussions internally and with media partners and civil rights organizations to stop the spread of hate speech". But it will continue to post on social media without paid promotion, it said.

 

The announcement came after Coca-Cola called for "greater accountability" from social media firms.

 

Coca Cola said it would pause advertising on all social media platforms globally, while Unilever, owner of Ben & Jerry's ice cream, said it would halt Twitter, Facebook and Instagram advertising in the US "at least" through 2020.

 

The announcements follow controversy over Facebook's approach to moderating content on its platform - seen by many as too hands off. It came after Facebook said on Friday it would begin to label potentially harmful or misleading posts which have been left up for their news value.

 

Founder Mark Zuckerberg said Facebook would also ban advertising containing claims "that people of a specific race, ethnicity, national origin, religious affiliation, caste, sexual orientation, gender identity or immigration status" are a threat to others.

 

 

The organisers of the #StopHateforProfit campaign, which has accused Facebook of not doing enough to stop hate speech and disinformation, said the "small number of small changes" would not "make a dent in the problem".

 

Starbucks said that while it was suspending advertising on some social platforms, it would not join the #StopHateForProfit campaign. More than 150 companies have paused advertising in support of #StopHateforProfit.

 

Coca-Cola also told CNBC its advertising suspension did not mean it was joining the campaign, despite being listed as a "participating business".

 

The campaign has urged Mr Zuckerberg to take further steps, including establishing permanent civil rights "infrastructure" within Facebook; submitting to independent audits of identity-based hate and misinformation; finding and removing public and private groups publishing such content; and creating expert teams to review complaints.

 

In an interview with Reuters, one of the campaign's organisers said it would also call on European firms to join the boycott. "The next frontier is global pressure," said Jim Steyer, the chief executive of Common Sense Media. He added that the campaign hoped European regulators would take a harder stance on social media firms such as Facebook.

 

In June, the European Commission announced new guidelines for companies to submit monthly reports on how they are handling coronavirus-related misinformation.

 

Last year, Facebook reported a 27% increase in advertising revenue on the previous year.--BBC

 

 

 

 

Boeing set for critical 737 Max flight tests

Boeing's bid to see its 737 Max return to the skies faces a pivotal week with flight safety tests expected to begin.

 

Pilots and technical experts from regulators and the company are understood to be planning three days of tests, possibly starting on Monday.

 

Boeing's best-selling aircraft was grounded last year after two crashes killed all 346 people on the flights.

 

The tests are a milestone for Boeing, but even if they go well, months of further safety checks will be needed.

 

Aviation regulators grounded the 737 Max about 15 months ago following two crashes - a Lion Air flight and an Ethiopian Airlines flight - within five months of each other.

 

The ruling triggered a financial crisis at the 103-year-old company, sparked lawsuits from victims' families, and raised questions about how Boeing and the US regulator, the Federal Aviation Administration (FAA), conducted their safety approval process.

 

Investigators blamed faults in the flight control system, which Boeing has been overhauling for months in order to meet new safety demands.

 

A 737 Max loaded with test equipment will run through a series of mid-air scenarios near Boeing's manufacturing base at Seattle.

 

According to Reuters, which first reported the news, pilots will intentionally trigger the reprogrammed stall-prevention software known as MCAS, blamed for both crashes.

 

The BBC understands that both the FAA, which is leading the testing, and Boeing, are hopeful that the process will get under way on Monday, barring last minutes hitches.

 

The FAA confirmed on Sunday in an email to the US Congress that it had approved key certification test flights for the grounded 737 Max.

 

The email noted that the "FAA has not made a decision on return to service" and has a number of additional steps to go, according to Reuters reports.

 

Test flights had been planned for last year, but investigations uncovered an array of new safety issues that have delayed a return to service.

 

It could take weeks to analyse data from the test flights. But even if this process is successful, further flying, training of pilots, and clearance from European and Canadian regulators will be needed.

 

The European Aviation Safety Agency has maintained that clearance by the FAA will not automatically mean a clearance to fly in Europe.

 

Norwegian Air, TUI, and Icelandair are among airlines using the 737 Max in Europe, while other carriers have the aircraft on order.

 

Boeing and the FAA declined to comment.--BBC

 

 

 

Coronavirus: UK to open up European holidays from 6 July

Blanket restrictions on non-essential overseas travel will be relaxed in the UK from 6 July, ministers have said.

 

Holidaymakers are expected to be allowed to travel to certain European countries without having to spend 14 days in quarantine when they return.

 

They are thought to include Spain, France, Greece, Italy, the Netherlands, Finland, Belgium, Turkey, Germany and Norway - but not Portugal or Sweden.

 

The full list of travel corridors with the UK will be published next week.

 

A government spokesman said the new rules would give people "the opportunity for a summer holiday abroad" while also boosting the UK economy - but stressed the relaxation depended on risks staying low.

 

A traffic light system will be introduced - with countries classified as green, amber and red depending on the prevalence of coronavirus. The UK is likely to discuss arrangements with countries over the coming days.

 

The government said it "wouldn't hesitate to put on the brakes" if the situation changes.

 

Ministers in Scotland have said that a decision has not yet been taken to ease restrictions on holiday travel.

 

Although the UK government has powers over border controls, health protection issues on overseas travel must be supported by Scottish government regulations because health is a devolved matter.

 

Travel services have seen a sharp rise in the number of holiday bookings.

 

Andrew Flintham, managing director at TUI UK and Ireland, said the company had seen bookings increase by 50% this week compared to last, with Spain and Greece the most popular destinations.

 

John Keefe, director of public affairs at Eurotunnel, said phones have been "ringing off the hook" with eager customers wanting to make bookings. Maximum service of four departures an hour at peak times will resume from 6 July, he added.

 

Mr Keefe said bookings had been "growing" in the past three weeks, but they "exploded when the news came out last night".

 

Portugal has seen a rise in the number of new cases in and around Lisbon recently, while Sweden is also unlikely to be on the list because the infection rate there is higher than in the UK. They are both likely to be classified as red.

 

But the government spokesman conceded there would be nothing to stop someone avoiding quarantine by flying into a Spanish airport, driving over the border into Portugal for their holiday and returning by the same route.

 

UK travellers will still have to hand over the address they plan to stay at on their return from abroad, no matter which country they are coming back from. And they will also be legally required to wear face coverings on planes and ferries.

 

Portugal's Secretary of State for Tourism Rita Baptista Marques told BBC Breakfast her country had been named the most secure destination in Europe by the World Tourism and Travel Council and is a "clean and safe destination".

 

"Some countries are in this list and Portugal is fighting for a place," Ms Marques said, adding that the situation is "completely under control", with significant testing being carried out.

 

The travel sector has gone to war with the government over its blanket quarantine policy.

 

So a more nuanced, risk-based approach will quieten the critics to some extent.

 

But the storm of controversy swirling around this policy won't completely go away.

 

Portugal, which will probably not be on next week's list of exemptions, feels hard done-by.

 

The country is desperate that UK tourists return.

 

And although in public health terms the US is not currently close to being on the list, it does potentially present a tricky diplomatic dynamic, given the normally cosy relationship between Washington and London.

 

And the transatlantic flight market is lucrative too.

 

This announcement is a step in the right direction for UK aviation, but they want testing at airports to also provide another way for passengers to be exempt. So far, in public, the government has said very little about that.

 

Greece's Tourism Minister Haris Theoharis suggested that it could be up to three weeks before the country is happy to open up an air bridge to the UK, as discussions with health experts are continuing.

 

Mr Theoharis told BBC Breakfast: "As soon as we have more clarity, we'll be able to convey the right dates and the right message so that's why it's not easy for me to pinpoint exact dates."

 

Spain lifted its state of emergency last Sunday, reopening its borders to visitors from most of Europe and allowing British tourists to enter the country without having to quarantine.

 

Travel industry group ABTA said the travel sector "eagerly" anticipates confirmation of the list of countries, which "should encourage customers to book".

 

"The blanket Foreign Office advice against all but essential travel is still a major impediment to travel, however, and we look forward to the government adopting a similar risk-based approach to that advice," it said in a statement.--BBC

 

 

 

Coronavirus: Delta to extend caps on passenger numbers

The boss of Delta Air Lines says the carrier will continue to limit the number of people on its planes beyond September.

 

So far the airline has been capping the numbers on board its flights to no more than 60% of capacity.

 

It is aiming to limit the spread of coronavirus and implement some form of social distancing.

 

Chief Executive Ed Bastian told the BBC that some of the details of the plan still need to be worked out.

 

He told the BBC: "We will be extending the cap on the planes post September, whether it's 60% or a slightly higher number I don't know, but yes we absolutely will."

 

It's significant because it means the world's second-biggest airline by passenger numbers could well be running flights at a loss for a longer period of time.

 

Financial pressure

Data from the US Department of Transportation suggests that last year, Delta needed to fill 70.6% of the seats on its flights to cover its costs.

 

However, airlines are now under even greater financial pressure, with planes sitting idle thanks to the huge fall in global demand for air travel.

 

Even those sitting on the tarmac cost their owners money, including through airport fees and maintenance costs.

 

Aviation analyst John Grant, from OAG, says that Delta is in a stronger position to break-even than its big US rivals American and United who need 78.6% and 73.8% capacity respectively to do so.

 

He explains that "those sort of break-evens are pretty typical around the globe", adding that "2019 was a good year though, with the cost of fuel very low compared to recent years and it can obviously fluctuate based on a mix of those costs and revenues per passenger."

 

American has not limited its capacity and United has a policy to allow passengers to choose to rebook on a different flight or receive a travel credit when flights are 70% full.

 

More routes are returning to Delta's schedule, with the carrier this week becoming the first US airline to reintroduce flights to China after a row between Washington and Beijing.

 

'Choppy recovery'

Nonetheless, Delta's boss acknowledges that it's not going to be straightforward to increase the number of passengers on each plane. With cases of Covid-19 now estimated to have passed 20 million in the United States, Mr Bastian says "of course" he is worried about a second wave of the outbreak.

 

"I've said throughout this pandemic that it's going to be a choppy recovery, it's going to be stops and starts and the virus is going to move, just as people move."

 

Like other airlines, Delta has measures in place to try and protect those on board its planes.

 

Mr Bastian says, "We need to make certain that we take all precautions for our people, for our customers, reinforcing wearing masks, social distancing, keeping our planes only at 60% full, making certain every seat next to a customer is open, so you have space on board, and doing everything we can to be cautious in the face of the spread.

 

"Because until there is a vaccine, it's going to be very hard to see this industry back at scale."

 

Mr Bastian concedes that the reduction in scale will mean cutting the number of staff, which is currently around 90,000.

 

Those roles are all protected until the end of September under the terms of a $5.4bn (£4.38bn) bailout plan funded by the US federal government.

 

But when the crunch comes, Mr Bastian hopes that volunteers will make the process less painful.

 

Virgin deal

"We're doing everything we can to hold on to as many jobs as possible, and while the job count will go down, our goal is to make it as voluntary for employees as we can".

 

As the airline tries to map out its future, thousands have signed up for early retirement whilst 37,000 others are taking time off without pay, in periods ranging from 30 days to a year.

 

In recent years, Delta has pursued a strategy of growing through the acquisition of stakes in other airlines, including LATAM which has sought bankruptcy protection in the US, and China Eastern.

 

Virgin Atlantic, has already announced more than 3,000 job cuts and remains in financial difficulty, with previously lucrative transatlantic crossings struggling like other routes.

 

Delta owns 49% of Virgin, but Mr Bastian says it won't be putting any more cash in and hopes to avoid administration.

 

Worst year

"We're not planning on injecting additional capital into Virgin. We're supporting them in doing everything we can, helping them through a restructuring, hopefully to avoid an in-court process, and I'm still optimistic, cautiously optimistic that we'll be able to get there".

 

Aviation analyst Andrew Charlton isn't as confident about Virgin Atlantic's prospects saying that he will "watch the process with fascination".

 

He adds that "the jury is still out on Delta's international expansion because the pandemic means there is almost no international long-haul travel, which is normally quite profitable, and the airlines in which it has stakes don't all have strong domestic networks to tap into".

 

The global airline body IATA is forecasting the industry's worst ever year with losses of more than $84bn.

 

But Mr Charlton thinks ultimately Delta is "well positioned" to weather the coronavirus storm compared to other carriers. This, he says is "thanks to a strong financial position and its US domestic position" which accounts for 70% of ticket sales.

 

You can watch Ed Bastian's full interview on Talking Business with Aaron Heslehurst on BBC World News at Saturday 2330 GMT,--BBC

 

 

 

Wirecard: Cardholders' money locked as FCA freezes UK subsidiary

Thousands of people in the UK are unable to access their money owing to the fallout from the scandal to hit payments firm Wirecard.

 

The UK licence of Wirecard Card Solutions has been frozen by the regulator after its German parent company filed for insolvency.

 

It means people are temporarily unable to access cash held with financial apps in the UK using Wirecard technology.

 

Some have spoken of their frustration, but their money should be safe.

 

Wirecard Card Solutions serves prepaid cards, such as the U Account, which marketed itself as an alternative to a bank which helped people to budget and avoid hefty overdraft fees.

 

"This is a massive issue for many customers who rely on the money placed in their U account for everyday essentials including the ability to pay rent and buy food," one customer told the BBC.

 

'Money is safe'

The regulator, the Financial Conduct Authority (FCA) said it had ordered Newcastle-based Wirecard Card Solutions "to cease all regulated activities in order to further protect customer money".

 

Financial technology firms Pockit; Anna Money, a business account; and Curve, which aims to consolidate people's finances in one app, told customers they would be blocked from their accounts after the FCA's decision.

 

They said that customers' money was still safe, but would not be accessible for a time.

 

"This action is not related to Curve - but Curve currently depends on Wirecard for operation of the Curve card," Curve told customers on Friday. "We are recommending that for the period of this short suspension Curve customers carry an alternative payment method," it added.

 

"We are already well on the way to migrating away from Wirecard but have not fully completed this process."

 

Anna said: "We expect the suspension to be lifted - the inability to use your account and card is temporary, and we are working to restore it as soon as possible."

 

Pockit said it was working with the FCA to get the issue solved as quickly as possible.

 

On its website, Wirecard Card Solutions said: "Wirecard Card Solutions Limited (WDCS) has temporarily suspended its electronic money issuing, card issuing and acquiring business with immediate effect and until further notice.

 

"WDCS is working hard to have the steps in place which will enable the suspension to be lifted so business can resume as usual. We will provide further updates on our website as soon as we can."

 

Funds are not protected, as they are in banks, by the Financial Services Compensation Scheme, but the firm said customers' money was held safely in segregated accounts.

 

The FCA has told people affected to contact their card provider.

 

The action comes after the German parent firm Wirecard last week disclosed a €1.9bn (£1.7bn) hole in its accounts, and subsequently filed for insolvency.

 

Former boss Markus Braun has been arrested and accused of inflating Wirecard's finances to make them appear healthier to investors and customers.

 

The Munich based firm employs almost 6,000 staff in 26 countries. The firm's creditors stand to lose billions of euros from the scandal.-BBC

 

 

 

Shopping centre giant Intu enters administration

The owner of some of the UK's biggest shopping centres, Intu, has called in administrators.

 

The firm, which owns the Trafford Centre, the Lakeside complex, and Braehead, said earlier it had not reached an agreement in financial restructuring talks with its lenders.

 

Its centres will stay open under administrators KPMG.

 

The company said shares listed on the London and Johannesburg stock exchanges had been suspended.

 

The significance of Intu's collapse "cannot be understated," said Richard Lim, chief executive of Retail Economics.

 

Intu collapse: What went wrong for the retail giant?

The coronavirus lockdown is speeding up a trend towards buying more consumer goods online, he said. He estimates 50% of workers normally can't receive parcels at work.

 

'Too much retail space'

But with many people spending most of their time at home, and car journeys to shopping centres discouraged, many of those people are now ordering via websites.

 

How landlords should react is a difficult question and there won't be a simple solution that will work for every mall, he says.

 

Particularly hard-hit will be shops at large office developments like Canary Wharf if more people are working from home.

 

"It's going to be a really, really tough challenge. There's no getting away from the fact we have too much retail space."

 

While more retailers and shopping centres are likely to close, landlords can offer shorter, flexible leases, he said, to attract retailers with new ideas.

 

The firm said it had appointed three administrators at the KPMG accountancy firm and that "the appointment is expected to become effective shortly".

 

The company was one of the UK's biggest shopping centre groups, with 17 centres in the UK.

 

In Nottingham, where it owns the Victoria Centre, shoppers said they hoped stores would remain open.

 

One worker at the local Boots, who didn't give her name, said she didn't know yet whether her shop will be affected. "I think we'll all be worried," she told the BBC.

 

Intu had been struggling even before the coronavirus outbreak with about £4.6bn worth of debt.

 

Intu has a hugely complicated corporate structure.

 

Although the company's gone into administration, its shopping centres haven't.

 

They are separate companies owned by a myriad of banks and lenders.

 

And they've now got the keys. Shoppers aren't likely to notice any real difference in the short term. But buyers will be sought.

 

The jewel in the crown is Manchester's Trafford Centre, followed by Lakeside.

 

But Intu's less-popular malls will prove more difficult to sell, especially given the turmoil in retail right now.

 

Intu is a property business which basically put all its eggs in one basket, buying more malls as shopping habits changed, and it ended up with way too much debt.

 

Coronavirus then compounded its problems.

 

Intu's spectacular collapse also highlights the pressures retail landlords are now under given the big slump in rental income from their tenants.

 

According to its annual report, published in March, its debts were worth 68% of its assets, a jump from 53% a year earlier.

 

It told investors earlier this month that it expected rent collected for 2020 to drop to £310m from £492m a year earlier.

 

According to Property Week, landlords collected just 18% of commercial rents for the three months to 24 June.

 

As rent payments dried up and property values fell, its prospects declined.

 

The company employs 2,500 people and its wider supply chain supports about 130,000 jobs, which will now be in doubt.

 

Intu's centres were partially shut during the coronavirus lockdown, with only essential shops remaining open.

 

The company had about 60% of shopping centre staff and about 20% of head office employees on furlough.

 

Investors in the company's shares will be nursing heavy losses.

 

Its shares traded as cheaply as 1.2 pence each early on Friday, valuing the company at £16m. It was worth as much as £13bn in 2006.--BBC

 

 

 

Northern Ireland to launch separate contact-tracing app

Northern Ireland is planning to release its own coronavirus contact-tracing app within weeks, the BBC has learned.

 

It follows the failure of the NHS app in England, which was trialled on the Isle of Wight.

 

The NI app will be based on the Google/Apple model.

 

It is designed to be compatible with an app due to be released soon in the Republic of Ireland. That app is also based on the toolkit provided by Apple and Google.

 

The Apple and Google model is more privacy-focused, but provides less data to epidemiologists than the centralised version that England was trialling.

 

"The Health Minister has commissioned work to develop a proximity app, based on the de-centralised Google/ Apple model, for use in Northern Ireland," said the Northern Ireland Department of Health in a statement.

 

"This work includes examining the interoperability of apps and the sharing of information across the border between Northern Ireland and the Republic," it said.

 

It added that the Information Commissioner, Equality Commission and NI Human Rights Commission were all involved in exploring "statutory information governance, equality and human rights issues", and that their assessments would be published.

 

If Northern Ireland does manage to release a functioning contact tracing app within weeks that will be a major embarrassment to the UK government.

 

After all, in England an NHS team managed to spend four months and nearly £12m ($15m) developing a centralised app that did not work.

 

The Health Secretary Matt Hancock then announced that the new focus would be on a decentralised app using the Google Apple toolkit - but that was unlikely to be ready for months.

 

Then this week the prime minister assured the House of Commons that no country in the world had a working contact tracing app.

 

Yet Northern Ireland's health minister seems confident that a few weeks work, perhaps building on the experience of Germany and other countries which have released decentralised apps, can deliver something that will do the job and even be compatible with the Irish Republic's project.

 

The NHS X team had always hoped its app would be rolled out across the UK - now perhaps it's Northern Ireland which will provide a high tech contact tracing solution that all four home nations can use.--BBC

 

 

 

 

 

 

 

 


 

 


 

INVESTORS DIARY 2020

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


Bindura Nickel Corporation

 

 

 


Padenga Holdings

 

 

 


Delta Corporation

 

 

 


Meikles Limited

 

 

 


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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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