Major International Business Headlines Brief::: 11 May 2020

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Major International Business Headlines Brief::: 11 May 2020

 


 

 


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

 


 

 


 

 

ü  Zambia seeks IMF funding to help soften impact of coronavirus

ü  Egypt's headline inflation rises to 5.9% in April -CAPMAS

ü  South Africa suspends use of Land Bank debt as collateral after default

ü  Egyptian state banks collect over $7 bln from high-yield certificates

ü  South Africa suspends use of Land Bank debt as collateral after default

ü  BAML sees platinum, palladium deficit this year as South Africa production losses bite

ü  South Africa's Phumelela Gaming enters business rescue

ü  South Africa to develop plan for new 2,500 MW nuclear plant

ü  S.African defence firm Denel fails to pay pension contribution, taxes

ü  South Africa's central bank switches back to one daily repo auction

ü  South African court halts layoffs at ailing airline SAA

ü  Saudi Arabia triples VAT to support coronavirus-hit economy

ü  Coronavirus: French passengers exempt from UK quarantine plans

ü  Colombian airline Avianca files for bankruptcy in US court

ü  Coronavirus: Elon Musk vows to move Tesla factory in lockdown row

 

 

 


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Zambia seeks IMF funding to help soften impact of coronavirus

LUSAKA (Reuters) - Zambia has applied to the International Monetary Fund (IMF) for a COVID-19-related rapid credit facility as it starts the process of shortlisting financial advisers to help reduce its debt load, the finance ministry said on Sunday.

 

Zambia was already wrestling with a growing public debt even before the new coronavirus outbreak forced lockdowns across the globe, delivering a big blow to demand for raw materials. Zambia is Africa’s second biggest copper producer.

 

Discussions with the IMF on the rapid credit facility are continuing, the finance ministry said in a statement.

 

Zambia has also closed a call for tenders for financial advisers over its debt and started the process of shortlisting and selecting the winner, it said in the same statement.

 

The IMF in April forecast Zambia’s economy would contract by 3.5% in 2020, down from growth of 1.5% in 2019, because of the impact of the coronavirus pandemic on the global economy.

 

Zambia’s economic activity has also been hampered by widespread power shortages.

 

The Zambian government’s external debt stock jumped to 45% of gross domestic product (GDP) in 2019, up from 37% in the previous year, while the total debt stock is estimated at 89%, according to World Bank data.

 

The IMF has approved requests for emergency pandemic aid from 50 of its 189 members for a total of about $18 billion, a spokesman for the Fund said on Thursday.

 

The number of new coronavirus cases in Zambia rose to 252 on Saturday and deaths from the highly infectious respiratory disease increased to seven, Health Minister Chitalu Chilufya said.

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

Egypt's headline inflation rises to 5.9% in April -CAPMAS

CAIRO (Reuters) - Egypt’s annual urban consumer price inflation rate increased to 5.9% in April from 5.1% in March, the official statistics agency CAPMAS said on Sunday, a rate higher than analysts had expected on the back of rising food prices.

 

While the country of 100 million people has not witnessed the panic buying seen in some European states as the coronavirus pandemic spread, demand surged in April ahead of the Muslim holy month of Ramadan.

 

“We expected a surge in Ramadan but the rate of increase is higher than we had anticipated. In the two weeks preceding the holy month, there was a lot of buying activity and a demand push across the board. We could possibly see some easing in May,” said Allen Sandeep, head of research at Naeem Brokerage, adding that the increase was still not a cause for concern.

 

Month-on-month urban inflation accelerated to 1.3% compared with 0.6% in March, CAPMAS said.

 

Core inflation, which strips out volatile goods such as food, also accelerated to 2.54% year-on-year in April, from 1.89% in March, the central bank said.

 

Egypt is facing tough economic repercussions from the spread of the new coronavirus, which essentially halted its vital tourism sector from mid-March. The country also imposed a nightly curfew, closed schools and universities, and shut restaurants and cafes to slow the spread of the disease.

 

Egypt asked the IMF for financial support last month to help it deal with the impact of the pandemic on its economy, and is seeking a Stand-By Arrangement (SBA) loan as well as emergency financing under a Rapid Financing Instrument (RFI) loan.

 

It is potentially eligible for as much as $2.78 billion under the RFI and about $4 billion per year under the SBA, according to analysts and information on the IMF website.

 

($1 = 15.7000 Egyptian pounds)

 

 

 

South Africa suspends use of Land Bank debt as collateral after default

JOHANNESBURG (Reuters) - South Africa’s central bank has temporarily prohibited the use of debt issued by the Land Bank as collateral after the state agricultural lender was downgraded deeper into junk status and missed $2.7 billion in loan repayments.

 

The South African Reserve Bank’s (SARB) decision will put additional pressure on the banking system, especially commercial and investment banks and institutional investors, which are already starved of the debt instruments necessary to access overnight cash to fund their daily operations.

 

The Land Bank had its credit rating cut to B1 from Ba2 by Moody’s in January, while Fitch has also warned of downgrades, and the lender defaulted on the loans totalling 50 billion rand in late April, citing a “liquidity shortfall”.

 

“In light of recent developments surrounding the Land Bank, including the downgrade of the rating and the subsequent debt default, the SARB has taken a decision to temporarily suspend Land Bank bills as eligible collateral in its repo operations,” the central bank said late on Friday.

 

Since the novel coronavirus outbreak prompted a national lockdown to limit its spread in March, local capital markets have suffered a severe lack of liquidity as investors rushed to sell emerging market assets.

 

That forced the typically conservative SARB to step with unconventional policy including a government bond-buying program and additional repurchase, or repo auctions to pump liquidity into funding markets.

 

The moves have so far been effective, but the removal of the Land Bank’s debt from the list of securities allowed for the weekly repo auctions may reignite funding pressures.

 

It will also hurt the Land Bank’s already strained ability to fund its operations and pay down debt, 50% of which matures in less than a year while another 10% is due in the next three years.

 

EFFECTIVE ON WEDNESDAY

The suspension is effective as of Wednesday when the central bank holds it main weekly repo auction, Samantha Springfield, senior manager in the SARB’s market operations and analysis division, said on Saturday.

 

“So any Land Bank paper that we currently have, that will then be returned to whichever banks have pledged it as collateral,” said Springfield.

 

The central bank currently accepts government bonds, treasury bills and central bank dentures as collateral at its weekly repo auctions. Land Bank bills were the only form of debt from a state-owned company accepted by the bank as collateral.

 

The National Treasury, which guarantees around 5.7 billion of the Land Bank’s debt, has yet to grant the lender any emergency funding.

 

In a 2019 presentation to investors the Land Bank said 17.5% of its debt was held by commercial banks while nearly 40% was with institutional investors.

 

Analysts have speculated that the treasury may increase issuance of treasury bills to meet demand which has climbed at recent auctions, as well as to plug a growing revenue hole.

 

($1 = 18.3370 rand)

 

 

 

Egyptian state banks collect over $7 bln from high-yield certificates

CAIRO (Reuters) - Egypt’s two biggest state banks have collected 121 billion Egyptian pounds ($7.7 billion) from a new high-yield savings certificate they introduced in March, officials from the two banks were quoted as saying on Sunday.

 

The one-year certificates, launched on March 22, carry a 15% yield.

 

The National Bank of Egypt’s deputy chairman said it had collected 82 billion pounds while Banque Misr’s chairman said it had gathered 39 billion pounds, state news agency MENA reported.

 

The certificates appear designed to bolster incomes while reducing inflation pressure and dollarisation following the coronavirus outbreak, analysts say.

 

($1 = 15.7700 Egyptian pounds)

 

 

South Africa suspends use of Land Bank debt as collateral after default

(Reuters) - South Africa’s central bank has temporarily prohibited the use of debt issued by the Land Bank as collateral after the state agricultural lender was downgraded deeper into junk status and missed $2.7 billion in loan repayments.

 

The South African Reserve Bank’s (SARB) decision will put additional pressure on the banking system, especially commercial and investment banks and institutional investors, which are already starved of the debt instruments necessary to access overnight cash to fund their daily operations.

 

The Land Bank had its credit rating cut to B1 from Ba2 by Moody’s in January, while Fitch has also warned of downgrades, and the lender defaulted on the loans totalling 50 billion rand in late April, citing a “liquidity shortfall”.

 

“In light of recent developments surrounding the Land Bank, including the downgrade of the rating and the subsequent debt default, the SARB has taken a decision to temporarily suspend Land Bank bills as eligible collateral in its repo operations,” the central bank said late on Friday.

 

Since the novel coronavirus outbreak prompted a national lockdown to limit its spread in March, local capital markets have suffered a severe lack of liquidity as investors rushed to sell emerging market assets.

 

That forced the typically conservative SARB to step with unconventional policy including a government bond-buying program and additional repurchase, or repo auctions to pump liquidity into funding markets.

 

The moves have so far been effective, but the removal of the Land Bank’s debt from the list of securities allowed for the weekly repo auctions may reignite funding pressures.

 

It will also hurt the Land Bank’s already strained ability to fund its operations and pay down debt, 50% of which matures in less than a year while another 10% is due in the next three years.

 

EFFECTIVE ON WEDNESDAY

The suspension is effective as of Wednesday when the central bank holds it main weekly repo auction, Samantha Springfield, senior manager in the SARB’s market operations and analysis division, said on Saturday.

 

“So any Land Bank paper that we currently have, that will then be returned to whichever banks have pledged it as collateral,” said Springfield.

 

The central bank currently accepts government bonds, treasury bills and central bank dentures as collateral at its weekly repo auctions. Land Bank bills were the only form of debt from a state-owned company accepted by the bank as collateral.

 

The National Treasury, which guarantees around 5.7 billion of the Land Bank’s debt, has yet to grant the lender any emergency funding.

 

In a 2019 presentation to investors the Land Bank said 17.5% of its debt was held by commercial banks while nearly 40% was with institutional investors.

 

Analysts have speculated that the treasury may increase issuance of treasury bills to meet demand which has climbed at recent auctions, as well as to plug a growing revenue hole.

 

 

 

BAML sees platinum, palladium deficit this year as South Africa production losses bite

JOHANNESBURG (Reuters) - There is likely to be a deficit of platinum and palladium this year after a COVID-19 lockdown in South Africa, the world’s biggest platinum producer, forced mines to shut, analysts at Bank of America Merrill Lynch predicted on Friday.

 

While demand for platinum group metals, which are mainly used in cars and jewellery, has also plummeted due to the global pandemic, the analysts said they expect demand to rebound, while mine production will take months to build back up.

 

In South Africa, which produces 78% of the world’s platinum and 36% of palladium according to BAML, a strict lockdown to stop the spread of COVID-19 forced most mines to shut from March 27.

 

Though the government allowed mines to restart at up to 50% capacity from April 16, BAML analysts predict it will take six months for production to ramp back up to pre-pandemic levels.

 

“Our base line assumption is that output runs at 50% in May and June, before rising to capacity by December,” they wrote in a note dated May 7 but distributed to media on May 8.

 

“Putting it all together, we anticipate that both platinum and palladium will be in deficit this year. As such, we remain bullish the white metals into year-end.”

 

South Africa’s biggest platinum miners have cut production guidance for 2020 and announced production losses due to the lockdown.

 

Anglo American Platinum said quarterly production decreased by 7%, while Impala Platinum reported a 6% drop. [nL5N2CB5X5] [nL8N2CI41J]

 

Analysts are split on how the demand-supply dynamics will play out: Citi on Wednesday predicted platin.

 

 

 

 

South Africa's Phumelela Gaming enters business rescue

JOHANNESBURG (Reuters) - South Africa’s Phumelela Gaming and Leisure on Friday joined a slew of distressed firms to file for business rescue - a local form of bankruptcy protection - after a nationwide lockdown suspended activities in the horse racing industry.

 

Phumelela, of which former Steinhoff International CEO Markus Jooste was a director and among its largest shareholders, has not been able to stage race meetings since the end of March due to the lockdown.

 

This has hurt its revenue from racing and betting, the company said in statement.

 

“... the best option to ensure the long-term survival of the company and the sport of horse racing, is to implement a business rescue plan,” Phumelela said.

 

South Africa’s business rescue process, which aims to shield a business from the demands of its creditors while an independent advisor attempts to turn it around, borrows from U.S., British, Canadian and Australian law.

 

But business rescue is uniquely South African in terms of its timetable, ranking of preference among stakeholders and the involvement of labour.

 

On March 26, President Cyril Ramaphosa imposed a five-week lockdown to curb the spread of coronavirus. Non-essential activities including sports and entertainment were forced to suspend operations.

 

This has hammered businesses in Africa’s most advanced economy, forcing a raft of companies to cut jobs and seek immediate help from the government.

 

Investment holding firm Labat Africa Ltd said on Friday it had placed its subsidiary Force Fuel into business rescue due to depressed volumes of wholesale fuels.

 

In the last two weeks prominent companies such as Comair, which operates the British Airways franchise in South Africa and owns budget airline Kulula, and non-food retailer Edcon have filed for business rescue citing the adverse impacts of the pandemic.

 

Debt-laden carrier state-owned South African Airways (SAA), which filed for business rescue in December, is already struggling to survive after the pandemic brought its operations and revenue to a halt.

 

SA Express, another state-owned carrier, has also been placed under “provisional liquidation” last Tuesday after the airline’s administrators said rescue efforts, which began in February, weren’t likely to succeed.

 

Earlier on Friday, chrome mining and minerals producer Afarak Group said it will voluntarily enter Afarak Mogale and Afarak South Africa in a business rescue process “as a consequence of the imposed restrictions and the relevant economic impacts.”

 

Most of the restrictions on leisure, entertainment or anything that requires mass gathering are still in place under a partial lifting of lockdown that was put in place from May 1.

 

National Horseracing Authority (NHA) CEO, Vee Moodley, said on Thursday the industry, “which is on the verge of collapse”, is asking the government to give it permission to resume controlled closed horse racing during level 4 lockdown restriction in order to save the majority of the 60,000 jobs.

 

Phumelela said the firm had received a proposal from a third party regarding a loan once business rescue proceedings started.

 

Phumelela, based at Turffontein Racecourse in Johannesburg, operates four race courses, five training centres and over 200 betting outlets. It also manages two race courses and betting outlets in the Western Cape on behalf of Kenilworth Racing.

 

 

 

South Africa to develop plan for new 2,500 MW nuclear plant

CAPE TOWN (Reuters) - South Africa will soon start developing a plan for a new 2,500 megawatt (MW) nuclear power plant, the energy ministry told lawmakers on Thursday.

 

Africa’s most industrialised economy, which operates the continent’s only nuclear power plant near Cape Town, said last year that it was considering adding more nuclear capacity in the long term, after abandoning in 2018 a massive nuclear expansion championed by former president Jacob Zuma. [nL5N25G261]

 

Analysts had expressed serious concern about Zuma’s project for a fleet of nuclear plants totalling 9,600 MW because it would have put massive additional strain on public finances at a time of credit rating downgrades.

 

Its current nuclear plant, Koeberg, has a capacity of around 1,900 MW and was synchronised to the grid in the 1980s.

 

“The development of the roadmap for the 2,500 MW Nuclear New Build Programme will be commencing soon,” the energy ministry said in a presentation to a parliamentary committee on its plans for 2020-25.

 

The presentation showed South Africa wanted to complete the procurement of the new nuclear plant by 2024 but gave no indication as to when it wanted construction of the plant to start or for when the plant would come online.

 

South African officials have talked about nuclear power as being part of an “energy mix” that also includes renewable sources like wind and solar as well as coal, on which it currently relies for more than 80% of its power generation.

 

But financing those nuclear ambitions could be difficult at a time that the country’s recession-hit economy is being hammered by the coronavirus pandemic, with this year’s budget deficit expected to stretch into double digits. [nL8N2CN68B]

 

Answering questions, Energy Minister Gwede Mantashe said on Thursday that the government would first “test the market” and hear what potential investors or consortia had to say about building the new nuclear facility.

 

“We may even give that company a right to develop a modular nuclear station on a build, operate and transfer basis, which means there may be no immediate call for funding from the state but the build programme can continue,” he said.

 

“We are going to explore all options, when there is appetite for nuclear in the market we will go ahead with it.”

 

 

 

 

S.African defence firm Denel fails to pay pension contribution, taxes

JOHANNESBURG (Reuters) - South African state-owned defence firm Denel is unable to make payments to its employee pension fund or meet some of its tax obligations as it struggles with a liquidity crunch, its chief executive wrote in a letter seen by Reuters on Friday.

 

Denel is one of a number of loss-making state-owned enterprises the government had been keeping afloat with bailouts but which are now being battered by the coronavirus pandemic and a nationwide lockdown aimed at preventing the disease’s spread.

 

“We still managed to pay the base salary for the month of April, whilst highlighting that the following months may still pose some significant financial challenges,” Danie du Toit wrote in a letter to company staff dated May 6.

 

The company, which makes military hardware for the South African armed forces and exports to clients around the world, was technically insolvent before the government injected 1.8 billion rand ($98 million) in August.

 

CEO du Toit is heading an effort to return the company to profitability. But like other manufacturers, it was forced to shut down all but essential operations under South Africa’s lockdown, which was loosened slightly last week.

 

In a separate statement on Friday, Denel said the pandemic had brought exports to a halt and delayed revenues from sales. It was also derailing plans to sell off some operations as part of its turnaround plan, as potential investors had frozen mergers and acquisition strategies.

 

While Denel was able to scrape together enough to cover its employees’ medical insurance, du Toit wrote that it would have to defer payments to the pension fund and some obligations to the South African Revenue Service.

 

“These decisions, particularly on pension funds are likely to have an impact on some of the current covers,” the letter stated.

 

Denel is still awaiting a further 576 million rand in bailout money announced in the government’s budget speech in February.

 

The need to fight the pandemic and its economic fallout, however, have since strained South Africa’s already stretched resources, with the government pledging a 500 billion rand stimulus package equivalent to 10% of gross domestic product.

 

($1 = 18.3665 rand)

 

 

 

South Africa's central bank switches back to one daily repo auction

JOHANNESBURG (Reuters) - South Africa’s central bank (SARB) said on Friday it would reduce overnight repo auctions to one per day from the two it has held since early March to inject liquidity into the banking system amid the coronavirus pandemic.

 

“This minor amendment to the liquidity management strategy will not have any adverse effect on liquidity operations and should not be construed as a change to the SARB’s liquidity provision to the market,” the bank said in a statement.

 

Repurchase agreements, or repos, are a form of short-term borrowing used in money markets, with mainly commercial banks and investment houses buying the securities in order to raise cash quickly and meet capital ratio rules.

 

Early in the pandemic, banks and investment firms saw a rapid increase in redemptions and margin calls as nervous investors looked to pull out their money, while increasing bid-offer spreads made buying and selling difficult.

 

That forced the Reserve Bank (SARB) to abandon its largely conservative approach and deploy unconventional policy measures, including a quantitative easing style bond-buying programme and a slew of large rate cuts, to limit the damage of the sharp liquidity drought.

 

Market conditions have since normalised, although volatility remains high, especially after the country saw credit rating downgrades in April, tipping Africa’s most developed economy into full junk status.

 

The bank’s data on Friday showed it had bought 11.42 billion rand ($622.19 million) worth of government bonds during March and April, bringing its total holding to 20.64 billion rand.

 

The bank has not set a target for government bond purchases but some analysts think it could reach as much as 100 billion rand to help plug a government funding gap.

 

“SARB accommodation in the secondary market is picking up. A trend like this could meaningfully raise overall liquidity in the secondary market in the months ahead,” said economists at ETM Analytics.

 

“A developing question in this context is whether there’ll be sufficient financing for the near 300 billion rand in lower taxes expected by the Treasury.”

 

The bank’s lowering of liquidity requirements and additional repo auctions have narrowed spreads in short-term money market rates, or the 3-month JIBAR.

 

Long term bond yields have also stabilised, with the yield on the 2030 issue dropping close to 400 bps from Mid-march highs of 9.335%.

 

“The measures we took in March are working,” said Samantha Springfield, senior manager in the SARB’s Market Operations and Analysis division.

 

“The need for liquidity that we’d identified has been satisfied. We’ve seen those strains in funding markets dissipate and in some places disappear. But we will continue to provide as much liquidity as is necessary,” Springfield said.

 

($1 = 18.3545 rand)

 

 

 

South African court halts layoffs at ailing airline SAA

JOHANNESBURG (Reuters) - South Africa’s Labour Court ordered a halt to layoffs at ailing South African Airways (SAA) on Friday, siding with two trade unions who had argued that the airline’s administrators had acted unfairly.

 

The decision throws efforts to rescue SAA into greater disarray after the administrators said the airline had run out of cash and the minister responsible for SAA criticised their efforts to rescue the company.

 

State-owned SAA has been fighting for its survival since entering a form of bankruptcy protection in December, with its fortunes deteriorating further when the coronavirus pandemic forced it to halt all commercial passenger flights and the government said it would not provide further funding.

 

The administrators have until the end of the month to draft a rescue plan for SAA but have told creditors that a wind-down or liquidation are likely outcomes.

 

Public Enterprises Minister Pravin Gordhan said on Wednesday that the government wanted to avoid SAA being liquidated and preferred to see it restructured into a new airline.

 

The administrators started consultations with unions in March about layoffs, but two unions - the National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA) - said those consultations should wait until the administrators had presented a business rescue plan.

 

The Labour Court sided with the unions, ruling that the layoff notices were “procedurally unfair” without the rescue plan having been published and ordering the administrators to withdraw the notices.

 

Administrators are still permitted to offer voluntary severance packages and employees can accept them, the court said.

 

The administrators, who had suspended a deadline for staff to agree to layoff terms while the court made its decision, said they were considering their next steps.

 

NUMSA and SACCA welcomed the judgment and said they were working on their own turnaround plan for SAA.

 

Gordhan said in a statement that his ministry’s lawyers would study the ruling to assess the implications for rescue efforts.

 

SAA has not made a profit since 2011 and has received bailouts worth more than 20 billion rand ($1.1 billion) over the past three years, a major drain on public resources alongside struggling state utility Eskom at a time of weak economic growth.

 

The airline said on Friday that it would continue repatriation flights “during the month of May and beyond” and that it was in talks with officials on places where South Africans might be stranded abroad.

 

($1 = 18.4393 rand)

 

 

 

Saudi Arabia triples VAT to support coronavirus-hit economy

Saudi Arabia is tripling its value added tax (VAT) as part of austerity measures to support its coronavirus-hit economy.

 

The government in Riyadh also said it will suspend its cost of living allowance to shore up state finances.

 

The oil-rich nation has seen its income plummet as the impact of the pandemic has forced down global energy prices.

 

The kingdom first introduced VAT two years ago as part of efforts to cut its reliance on world crude oil markets.

 

Saudi Arabia's state news agency said VAT will increase from 5% to 15% as of 1 July, while the cost of living allowance will be suspended from 1 June.

 

"These measures are painful but necessary to maintain financial and economic stability over [the] medium to long term... and overcome the unprecedented coronavirus crisis with the least damage possible," finance minister Mohammed al-Jadaan said in the statement.

 

The announcement came after state spending outstripped income, pushing the kingdom into a $9bn (£7.2bn) budget deficit in the first three months of the year.

 

That's as oil revenues in the period fell by almost a quarter from a year earlier to $34bn, pulling down total revenues by 22%.

 

At the same time Saudi Arabia's central bank saw its foreign reserves fall in March at their fastest rate in at least two decades and to their lowest level since 2011.

 

The measures to fight the impact of coronavirus are expected to slow the pace and scale of economic reforms launched by Crown Price Mohammed bin Salman.

 

Last year Saudi Arabia raised a record $25.6bn in the initial public offering of shares in state-owned oil giant Aramco in Riyadh.

 

The share sale was at the heart of Crown Prince Mohammed bin Salman's plans to modernise the economy and wean it off its dependence on oil.--BBC

 

 

 

Coronavirus: French passengers exempt from UK quarantine plans

French passengers will be exempt from quarantine measures that will come into force in the UK amid the pandemic.

 

Boris Johnson said on Sunday the measures would be imposed on people arriving in the UK, to prevent Covid-19 being brought in from overseas.

 

Mr Johnson said he was "serving notice" that quarantine measures were coming.

 

Following his speech, No 10 confirmed a reciprocal deal with the government in Paris meant restrictions would not apply to passengers from France.

 

In a joint statement, the UK and French governments said they had agreed to "work together in taking forward appropriate border measures", adding: "This co-operation is particularly necessary for the management of our common border."

 

The statement added: "No quarantine measures would apply to travellers coming from France at this stage; any measures on either side would be taken in a concerted and reciprocal manner.

 

"A working group between the two governments will be set up to ensure this consultation throughout the coming weeks."

 

In his address to the nation on Sunday, the prime minister said: "I am serving notice that it will soon be the time - with transmission significantly lower - to impose quarantine on people coming into this country by air."

 

UK airlines previously said they had been told that any quarantine period would last for 14 days, and that people might be expected to provide an address when they arrive at the border.

 

Government sources had already indicated that people arriving from the Republic of Ireland would not have to self-isolate when the quarantine measures take effect.

 

'Growing crisis' for aviation

Despite speaking to the aviation minister on Sunday, airline and airport bosses told the BBC that they were still in the dark over basic details such as when the quarantine measures would come into force, when they would end and whether they would be continuously reviewed.

 

Airlines are calling for additional government support after the prime minister confirmed a quarantine period will come into force.

 

Airlines UK chief executive Tim Alderslade said: "We all, including government, need to adapt to the new normal, but closing off air travel in this way is not the way to achieve this.

 

"Ministers are effectively telling people they can no longer travel for the foreseeable future and airlines will respond to that by grounding their operations."

 

He added: "That is why they require urgent additional government support to get through this growing crisis."

 

The government faces a two-pronged attack over its travel quarantine, even though the detail on the policy is still sparse.

 

The pandemic is already causing acute damage to the UK's aviation sector, and airline and airport bosses believe the quarantine will make things a whole lot worse.

 

They did not receive the reassurances they wanted during a call with the aviation minister earlier on Sunday.

 

Opposition MPs are also wading in with the question: "If now, why not before?"

 

It's estimated that about 100,000 people have arrived in the UK since 23 March, when the lockdown was brought in.

 

Many people coming home in recent weeks have been left confused over whether they were supposed to self-isolate.

 

Government advice that people arriving from China and Italy who didn't have symptoms should stay at home for two weeks was withdrawn on 13 March.

 

Air travel has ground to a halt because of the global coronavirus pandemic, prompting steep job cuts by the industry.

 

Ryanair has said it plans to axe 3,000 workers and has asked remaining staff to take a pay cut.

 

BA has said it will cut 12,000 of its workforce and has warned that it might not reopen at Gatwick Airport once the pandemic passes.--BBC

 

 

 

Coronavirus: Businesses want 'clear guidance' on return to work

Business groups have called for clarity on what will need to change in the workplace as Boris Johnson unveils a "conditional plan" to reopen society.

 

"Businesses need their practical questions answered so they can plan to restart, rebuild and renew," said the British Chambers of Commerce.

 

The prime minister said those who could not work from home should be "actively encouraged to go to work" in England.

 

But he told people to avoid using public transport where possible.

 

"Businesses will need to see detailed plans for the phased easing of restrictions, coordinated with all nations across the UK and supported by clear guidance," said Adam Marshall, director of the British Chambers of Commerce (BCC).

 

He added: "It is imperative that companies have detailed advice on what will need to change in the workplace, including clarity on the use of personal protective equipment (PPE)."

 

Clear guidance 'vital'

In a televised address, Mr Johnson said he wanted those in the construction and manufacturing industries to return to work this week.

 

Caution was however urged by other trade groups, such as the Institute of Directors (IoD).

 

Its director general, Jonathan Geldart, said it was vital the guidance was clear so that companies could plan how to return safely.

 

"As people with ultimate legal responsibility, directors need to have confidence that it's safe, and that if they act responsibly they won't be at undue risk. Businesses should consult with their people to put in place robust policies, which in many cases might not be an overnight process."

 

Carolyn Fairbairn, the director general of the Confederation of British Industry (CBI) said businesses were "keen to open and get the economy back on its feet".

 

"But they also know putting health first is the only sustainable route to economic recovery. The message of continued vigilance is right," she said.

 

Commenting on the prime minister's address, she said: "This announcement marks the start of a long process. While stopping work was necessarily fast and immediate, restarting will be slower and more complex. It must go hand in hand with plans for schools, transport, testing and access to PPE. Firms will want to see a roadmap, with dates they can plan for."

 

Difficult path ahead

Very little has changed in terms of the regulations and prohibitions first announced in March. The lockdown remains. Closed shops, for example, won't reopen.

 

What we did get was a "change of emphasis" - that people should assume they should go back to work, rather than presume they should not.

 

Some in government and in industry fear that the "stay at home" message has now deeply embedded itself in the minds of millions of workers.

 

The prime minister's replacement of that message with "stay alert" in England is designed to get businesses to use the existing discretion in the lockdown regulations.

 

The practicalities of that are not easy, however, with business groups and unions not agreeing on what constitutes a "Covid-safe" workplace.

 

The government acknowledges that there won't be enough public transport options for people to return to work. Many workers will also face problems with childcare.

 

On top of that, to the extent that some industries will reopen - such as construction and perhaps some forms of hospitality by July, any increase in the rate of infection could see the brakes applied quickly.

 

The path ahead will be a delicate, difficult and constant balancing act between health and the economy. For now, the economy is definitively second priority.

 

During his address, Mr Johnson added that workplaces would receive guidance on how to become "Covid secure".

 

Frances O'Grady, general secretary of the Trades Union Congress, called for those guidelines to be published.

 

Lots of working people will feel confused and anxious after listening to Boris Johnson.

 

Govt still hasn’t published guidance on how workers will be kept safe. So how can the PM – with 12-hours' notice – tell people to go back to sites and factories?

 

It’s a recipe for chaos.

 

 

BBC News previously reported that reduced hot-desking and alternatives to social distancing where it is not possible were among measures being considered to let workplaces reopen.

 

One of seven draft plans to ease anti-coronavirus restrictions, seen by the BBC, also urged employers to minimise numbers using equipment, stagger shift times and maximise home-working.

 

Many companies have been shut since widespread limits on everyday life were imposed on 23 March, in a bid to limit the effects of the virus's spread on the NHS.

 

As a result, the government is now paying the wages for nearly a quarter of UK jobs under a programme aimed at helping people put on leave due to the virus pandemic.

 

Under the job retention scheme, it funds 80% of workers' wages, up to £2,500 a month.

 

On Sunday, business groups also urged caution when it came to any future withdrawal of the support.

 

Adam Marshall of the BCC added: "Firms will also need to know that government support schemes, which have helped save millions of jobs in recent weeks, will continue for as long as they are needed so that they can plan ahead with confidence."--BBC

 

 

 

Colombian airline Avianca files for bankruptcy in US court

Colombia's national airline, Avianca, has filed for bankruptcy protection in a US court.

 

The carrier is the second-largest in Latin America, but its passenger operations have been grounded since March because of coronavirus.

 

It said the pandemic had cut more than 80% of its income, and it was struggling with high fixed costs.

 

If it fails to come out of bankruptcy, Avianca will be the first major airline to go under amid the pandemic.

 

In a statement, the firm said it had filed for Chapter 11 bankruptcy protection in a court in New York. The process postpones a US company's obligations to its creditors, giving it time to reorganise its debts or sell parts of the business.

 

Chief executive Anko van der Werff said the move was needed to ensure the New York-listed airline emerge as a "better, more efficient airline that operates for many more years".

 

How will airlines get flying again?

More than 140 of its aircraft have been grounded since Colombian President Ivan Duque closed the country's airspace in March. Most of its 20,000 employees have been put on unpaid leave.

 

Behind KLM, Avianca is the second-longest continually running airline in the world.

 

It previously filed for bankruptcy in the early 2000s, and was rescued by a deal with Bolivian oil tycoon German Efromovich. The airline grew quickly under his stewardship, but its growing debt led to a successful boardroom coup against Mr Efromovich last year. It is now run by Kingsland Holdings.

 

The coronavirus pandemic has dealt a huge blow to the international aviation industry, as governments impose travel restrictions and confinement measures.

 

Global air travel has fallen by 90%, according to the International Air Transport Association. The body predicts Latin American airlines will lose $15bn (£12bn; €13.9bn) in revenues this year - the biggest drop in the industry's history.--BBC

 

 

 

Coronavirus: Elon Musk vows to move Tesla factory in lockdown row

Elon Musk, the billionaire owner of electric car company Tesla, is embroiled in a row over reopening its California-based factory

Billionaire Tesla boss Elon Musk has said he will move the electric carmaker's headquarters out of California, after he was ordered to keep its only US vehicle plant closed.

 

"Tesla will now move its HQ and future programs to Texas/Nevada immediately," the CEO tweeted.

 

The company was filing a lawsuit against Alameda County, he added.

 

The county's health department had refused to let the Tesla factory reopen on Friday, citing lockdown measures.

 

According to figures from Johns Hopkins University, 2,715 people in California have died with coronavirus.

 

Since 23 March, all but "basic operations" have been suspended at Tesla's Fremont plant, near San Francisco, because of "shelter in place" orders enacted in Alameda County. The factory employs more than 10,000 workers, and makes about 415,000 vehicles every year.

 

California's government has eased some restrictions around the state this week, allowing businesses to resume operations. But several Bay Area counties have issued their own criteria for which businesses may reopen, which take precedence.

 

In Alameda, all but essential businesses must remain shut until the end of May.

 

Mr Musk suggested the factory's future could now be in doubt, tweeting: "If we even retain Fremont manufacturing activity at all, it will be dependen[t] on how Tesla is treated in the future."

 

In a statement released before Mr Musk's tweets, Alameda County said: "We welcome Tesla's proactive work on a reopening plan, so that once they fit the criteria to reopen, they can do so in a way that protects their employees and the community at large."

 

Mr Musk, 48, who welcomed a baby with Canadian singer Grimes earlier this week, wiped $14bn (£11bn) off Tesla's value on 1 May after tweeting that its share price was too high.

 

He has donated over 1,200 ventilators to hospitals in the US to assist with treating coronavirus patients.

 

The tech billionaire has also poked fun at the mass purchasing of toilet paper when the pandemic began. But he has also sparked controversy for promoting an unproven treatment for the virus, and for asserting, falsely, that children are "essentially immune".

 

Mr Musk has continually voiced his opposition to "fascist" lockdown measures, tweeting "FREE AMERICA NOW" last month.

 

Tesla has suspended operations at its plant in the Chinese city of Shanghai, according to Bloomberg. It had previously closed the factory as a temporary measure when the virus was at its peak in China.

 

The company reported a net profit in the first three months of this year, and its stock has risen to nearly $820 (£669; €756). But analysts expect the coronavirus pandemic will adversely affect its earnings in 2020.--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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