Major International Business Headlines Brief::: 06 November 2020
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Major International Business Headlines Brief::: 06 November 2020
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ü Covid: Denmark removed from UK's travel corridor list
ü UK insurer's shares rocket 46% after takeover talk
ü The foul-smelling fuel that could power big ships
ü Uber sees 'fundamental shift' in food delivery demand
ü Bitcoin: $1bn seized from Silk Road account by US government
ü Smallest job gains in five months expected as U.S. labor market momentum wanes
ü Asian shares at near three-year peak; dollar, U.S. yields head south
ü Apple must face shareholder lawsuit over CEO Cook's China sales comments
ü Wall Street rallies as investors eye split U.S. Congress
ü Nigeria: Aviation Minister Explains Why Nigerian Airlines Fail
ü Nigeria: Oil Price Slump Threatens 2021 Budget - Govt
ü Chad: Govt to Resume Oil Exploration in Lake Chad Basin
ü Tanzania - Internet Slowdown Comes At a High Cost
ü Malawi: MCCI Cancels Malawi International Trade Fair Due to Covid-19
ü Kenya: Safaricom Introduces Four New Prefix Numbers
ü Gambia: Asky Airlines Resumes Flight to Destination Gambia Today
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Covid: Denmark removed from UK's travel corridor list
Denmark has been taken off the UK's coronavirus travel corridor list, the transport secretary has said.
Passengers arriving in the UK from 04:00 GMT on Friday will need to self-isolate for 14 days.
Grant Shapps said it was an "urgent decision" taken overnight following recent "developments".
It comes after health authorities in Denmark found a mutated form of coronavirus that can pass to humans was present in the country's mink farms.
The announcement was made at around 01:30 GMT - two and a half hours before the change came into force.
Mr Shapps called it a "swift decision" in a statement published on the government's website.
"I understand that this will be concerning for both people currently in Denmark and the wider UK public, which is why we have moved quickly to protect our country and prevent the spread of the virus to the UK," he said.
He said the "precautionary measure" was introduced at the recommendation of the government's chief medical adviser, Prof Chris Whitty.
The decision about Denmark came less than 12 hours after Germany and Sweden were taken off the travel corridor list, which applies to the whole of the UK.
Passengers arriving in the UK from Germany or Sweden after 04:00 GMT on Saturday will need to self-isolate for 14 days.
Travellers currently in Denmark are allowed to finish their trips and are advised to follow the local rules and Foreign Office travel advice.
Leaving home to go on holiday is currently banned for most people in the UK.
In England, where a new national lockdown came into force on Thursday, people are still allowed to travel overseas for work or education trips.
In Wales, which is in a "firebreak" lockdown until 9 November, the devolved government says people can only go abroad if they have "a reasonable excuse".
People in Northern Ireland are being urged by the government there to "carefully consider" their holiday and travel options
Danish authorities have said a lockdown will be introduced in some areas over the coronavirus mutation found in mink farms.
Bars, restaurants, public transport and all public indoor sports will be closed in seven North Jutland municipalities.
The restrictions will come into effect from Friday and initially last until 3 December.
This week, Denmark's prime minister said the country would cull all of its mink - as many as 17 million.
Mette Frederiksen said the mutated virus posed a "risk to the effectiveness" of a future Covid-19 vaccine.
The Scandinavian country is the world's biggest producer of mink fur and its main export markets are China and Hong Kong.
Culling began late last month, after many mink cases were detected.—BBC
UK insurer's shares rocket 46% after takeover talk
RSA is in talks with a consortium of Canadian insurer Intact Financial and Danish insurer Tryg about a possible deal.
The deal, which could see the British insurer broken up, values it at about £7.2bn ($9.46bn).
RSA, famous for its More Than brand, has large operations in Canada, Ireland and Scandinavia.
After the talks were revealed, its share price rocketed 46% to close at 670 pence on Thursday.
The proposal from Intact Financial and Tryg would pay 685 pence in cash per RSA share.
This represented a 50% premium to RSA's closing price on 1 October. Analysts Jefferies said the offer price represented "more than fair value".
"The board of RSA has indicated to the consortium that it would be minded to recommend the proposal, subject to satisfactory resolution of the other terms of the possible offer, including a period of due diligence," the UK insurer said in a statement.
RSA was formed by the merger of Sun Alliance and Royal Insurance in 1996 and provides home, motor and commercial insurance.
Break-up
Under the terms of the deal, Intact and Tryg would split up RSA's businesses with the Canadian firm keeping its Canada and UK operations,
Tryg would take control of RSA's Sweden and Norway operations, while the pair would also co-own RSA's Danish unit.
Tryg would take on the highest bill, paying RSA about £4.2bn and Intact would contribute £3bn.
The two insurers have until 3 December to make a firm offer.
Long history
RSA has a history going back more than 300 years.
Sun Alliance had its origins in Sun Fire Office, the oldest documented insurance company in the world founded in London in 1710.
Royal Insurance was established in Liverpool in 1845.
RSA has long been seen as a takeover target and came close to a sale to Switzerland's Zurich Insurance in 2015.
The company employs 13,500 people across more than 100 countries.--BBC
Bentley reveals roadmap to go fully electric by 2030
Luxury carmaker Bentley has unveiled plans to go fully electric by 2030.
Before then, the brand will be switching its model range to offer only plug-in hybrid or battery electric cars by 2026.
Volkswagen-owned Bentley also aims to be completely carbon neutral across its manufacturing within a decade.
Electric cars are growing in popularity and sales have tripled in the UK so far this year.
"Within a decade, Bentley will transform from a 100-year-old luxury car company to a new, sustainable, wholly ethical role model for luxury," said Adrian Hallmark, Bentley's chief executive.
Workers on internal combustion technology will be redeployed as it shifts to pure battery electric cars.
Bentley, famous for its enormous 12-cylinder petrol engines, now wants to become one of the car industry's leaders in environmental sustainability.
The carmaker said its environmental targets would make it "financially resilient and recession proof" as it looks to protect itself from the coronavirus downturn, which has damaged car sales.
Bentley's German owners Volkswagen is investing of billions of euros into electric car technology.
In June, Bentley announced it would make 1,000 job cuts from its workforce to reduce costs, although this has since been scaled back.
Bentley also wants to raise the proportion of women and people from black, Asian and minority ethnic backgrounds in its management ranks to 30%, from its current 20%.
Electric dreams
Figures released on Thursday showed the weakest October for new UK car sales in nine years.
The number of cars registered fell 1.6% to 140,945, according to the Society of Motor Manufacturers and Traders.
However, electric car sales were one of the few bright spots, nearly tripling so far in 2020 to 76,000.--BBC
The foul-smelling fuel that could power big ships
An enormous engine, the height of three floors, growls loudly at a test centre in Copenhagen. Nearby a team of engineers supervise it from a control room resembling a ship's bridge.
Usually such an engine would be propelling a large ship across the sea, but this one is being prepared to take part in a ground-breaking project.
Engineers want to see if they can make it run on liquid ammonia.
Ammonia has long been a key component in fertiliser, cleaning products and refrigerators.
But in the search for new cleaner fuels, the foul-smelling substance has emerged as a frontrunner to power ocean-going ships.
Around 90% of all goods traded globally are transported by sea. But ships are gas guzzlers. Marine transport produces around 2% of global greenhouse gas emissions.
The International Maritime Organization (IMO) wants to halve emissions by 2050, from 2008 levels. That requires a substantial shift to green technology.
Brian Soerensen, a research and development chief at Man Energy Solutions, says several fuels are being explored: "One of the options we believe will be ammonia. Methanol could be another one, biofuel could be a third."
Ammonia has an advantage as it contains no carbon, so can burn in an engine without emitting carbon dioxide.
By early 2024, Man Energy Solutions plans to install an ammonia-ready engine on a ship. The first models will be dual-fuel, able to run on traditional marine gas oil as well.
While it is less energy-rich than today's marine fuels, liquid ammonia is more energy-dense than hydrogen, another zero-emission fuel.
Hydrogen has already powered cars, planes and trains. It's cheaper to produce than ammonia, but harder to handle as it has to be stored at minus 253C. Ammonia becomes liquid below minus 34C and at higher temperatures if under pressure.
"Ammonia sits very nicely in the middle," says Dr Tristan Smith, an expert in low carbon shipping from University College London. "It's not too expensive to store and not too expensive to produce."
There are challenges. Burning ammonia can create polluting nitrous oxides, therefore the exhaust needs cleaning up. It is also toxic, so requires careful handling and storage.
However, safety know-how and some port infrastructure are already in place, says Mr Soerensen, because the fertiliser industry is well-established.
"It's being transported seaborne today. We know how to handle ammonia on board a ship, not as a fuel, but as a cargo."
Meanwhile, Norwegian shipping company Eidesvik plans to install ammonia fuel cells on a vessel by late 2023. Like batteries, these generate electrical energy to power a motor. Project partner Prototech has already begun developing a test version.
The supply ship, Viking Energy, will sail round-trips of 345 miles (555km). The hybrid vessel will also use liquefied natural gas (LNG).
Vermund Hjelland, vice president of technology and development at Eidesvik, says fuel cells are more efficient and cost-effective, for such short, predictable routes. "You can have smaller tanks and get more kilowatt-hours out of the same amount of fuel.
"The picture is different compared to a super-tanker," he adds. "It very much depends whether weight is an issue."--BBC
Uber sees 'fundamental shift' in food delivery demand
Uber's food delivery business has more than doubled, as the pandemic increases appetite for online grocery orders and restaurant takeaway.
The firm said revenue from its Uber Eats service hit $1.4bn (£1bn) in the three months to 30 September, jumping 124% from the same period in 2019.
The growth helped offset steep declines in the firm's core rides business.
But Uber still recorded a loss of about $1.1bn in the quarter, roughly the same as last year.
Uber boss Dara Khosrowshahi said demand for food delivery has stayed strong even as countries lift restrictions, a promising sign for growth in the Uber Eats business.
"We've got more eaters, they're staying longer, they're eating more," he told investors on a conference call to discuss the firm's quarterly results.
"There's no question in my mind that ... there's a fundamental behavioural shift that has gone on," he added later. "People aren't going to stop using Amazon. People aren't going to stop using Eats."
The growth in delivery marked a stark contrast to the firm's ride-hailing business.
There, Uber said bookings and revenue for its taxi service remained roughly half of last year's levels, despite improvement since the spring.
Demand has recovered most in Europe, while lagging in the US and Canada, its most important market, executives said.
They warned that the resurgence in Covid cases in Europe and new restrictions in countries like the UK and France would likely hit demand in coming months.—BBC
Bitcoin: $1bn seized from Silk Road account by US government
More than $1bn (£772m) in Bitcoin linked to the notorious Silk Road website has been seized by the US Department of Justice (DoJ).
Earlier this week, crypto-currency watchers noticed about 70,000 bitcoins being moved from an account believed to be linked to the illicit marketplace.
Silk Road was an online black market, selling everything from drugs to stolen credit cards and murderers-for-hire.
It was shut down by the US government in 2013.
The sum is the largest amount of crypto-currency seized to date by the Department of Justice.
On Thursday, US Attorney David Anderson confirmed that the officials had seized the crypto-currency assets.
"Silk Road was the most notorious online criminal marketplace of its day," he said in a statement.
"The successful prosecution of Silk Road's founder in 2015 left open a billion-dollar question. Where did the money go?
"Today's forfeiture complaint answers this open question at least in part. $1bn of these criminal proceeds are now in the United States' possession."
The Internal Revenue Service's Criminal Investigation unit said it used third-party company to analyse Bitcoin transactions that had been executed by Silk Road.
This led it to an address belonging to "Individual X", who is alleged to have hacked the funds from the marketplace.
Law enforcement officers in turn took control of the sum on 3 November, and the DoJ claims the funds are now subject to forfeiture.
"Criminal proceeds should not remain in the hands of the thieves," said IRS special agent Kelly Jackson.
In 2015, Bitcoin seized from a different wallet associated with Silk Road was sold at auction by the US government.
Silk Road creator Ross Ulbricht is currently serving two life sentences in prison after being found guilty of money laundering, computer hacking, and conspiracy to traffic narcotics.--BBC
Smallest job gains in five months expected as U.S. labor market momentum wanes
WASHINGTON (Reuters) - U.S. employers likely hired the fewest workers in five months in October, in what would be clearest indication yet that the end of fiscal stimulus and exploding new COVID-19 infections were sapping momentum from the economic recovery.
The Labor Department’s closely watched employment report on Friday will underscore the challenges the next president, whether it is incumbent Republican Donald Trump or Democrat Joe Biden, confronts to keep the economy growing as it heals from the deepest recession since the Great Depression.
Biden inched closer to victory on Thursday in an exceedingly close U.S. election, while Trump alleged fraud without providing evidence, filing lawsuits and calling for recounts in a race yet to be decided since polls closed on Tuesday.
“The October jobs report is likely to show evidence of a weakening labor market,” said Dean Baker, senior economist at the Center for Economic and Policy Research in Washington. “This is an urgent problem facing whoever will be in the White House.”
Nonfarm payrolls likely increased by 600,000 jobs in October after rising 661,000 in September, according to a Reuters survey of economists. That would be the smallest gain since the jobs recovery started in May and leave employment 10.1 million jobs below its February peak.
The employment report is also expected to show increases in the ranks of people who have permanently lost their jobs, as well as those who have been out of work for more than six months.
A contested election reduces the chances of another coronavirus rescue package from the government this year. Even if more fiscal policy is agreed on, it will likely be smaller than had been anticipated before the election.
That will shift the spotlight to the Federal Reserve.
The U.S. central bank kept interest rates near zero on Thursday. Fed Chair Jerome Powell acknowledged the pace of improvement in the economy and labor market had moderated, noting that the recovery would be stronger with more fiscal support.
More than $3 trillion in government pandemic relief for businesses and workers fueled a historic 33.1% annualized rate of economic growth in the third quarter. That followed a record 31.4% pace of contraction in the April-June quarter.
Lack of fiscal stimulus and spiraling new coronavirus infections across the country have put the economy on a sharply slower growth path heading into the fourth quarter. Restaurants and gyms have moved outdoors, but cooler weather and the resurgence in COVID-19 infections could leave many in trouble.
Even if states and local governments do not impose new restrictions on businesses, consumers are likely to stay away, fearing exposure to the respiratory illness. The United States set a one-day record for new coronavirus cases on Wednesday with at least 102,591 infections, according to a Reuters tally.
DOWNSIDE RISK
“The virus is still keeping many people from going to their local restaurants, bars and cafes, and this continues to weigh on the employment numbers for small businesses,” said Torsten Slok, chief economist at Apollo Global Management in New York.
“Given half of U.S. employment is in businesses with less than 500 workers and given the lower likelihood of additional fiscal support, this is a downside risk to nonfarm payrolls over the coming months, including tomorrow.”
Large corporations are also not immune. Exxon Mobil last month announced 1,900 layoffs in the United States. Boeing said it expected to eliminate about 30,000 jobs, 11,000 more than previously planned, by end-2021.
A below-forecast payrolls number for October cannot be ruled out. Reports on Wednesday showed hiring by private employers missed expectations by a wide margin last month and employment in the services sector industry slowed.
Data from Homebase, a payroll scheduling and tracking company, showed the number of employees working last month little changed from September.
Overall job growth in October was likely restrained by the departure of more temporary workers hired for the 2020 Census, and tight budgets at state and local governments.
Retailers normally start hiring for the holiday season in October, a practice that was upended by the pandemic. According to economists at JPMorgan, this could throw off the model the government uses to strip out seasonal fluctuations from the data and weigh on nonfarm payrolls.
The unemployment rate is forecast falling to 7.7% from 7.9% in September. That is not a true reflection of the labor market’s health as the jobless rate has been biased down by people misclassifying themselves as being “employed but absent from work.”
At least 21.5 million people were receiving unemployment benefits in mid-October. Many people, mostly women, have dropped out of the labor force to look after children or because they fear contracting the virus.
“Lingering coronavirus fear, a slowing economic recovery
and reports of childcare challenges are making discouraged
workers more reluctant to rejoin the official ranks of those
seeking work while pushing others to leave the labor market
for the time being,” said Kathy Bostjancic, chief U.S. financial economist at Oxford Economics in New York.
With labor market momentum ebbing, average hourly earnings are forecast rising 0.2% in October after gaining 0.1% in September. The average workweek is seen steady at 34.7 hours.—BBC
Asian shares at near three-year peak; dollar, U.S. yields head south
TOKYO/NEW YORK (Reuters) - A gauge of Asian shares rallied to a near three-year peak while the dollar stayed sluggish and U.S. bond yields slipped on Friday in anticipation that a divided U.S. legislature would limit major policy changes and keep the status quo on economic policies.
Investors expect Democrat Joe Biden to beat President Donald Trump and the Republicans to retain control of the Senate, allowing them to block the Democrats’ agenda, such as corporate tax hikes and massive borrowing for large spending.
“With the prospects of fiscal stimulus constrained by a likely gridlock in Washington, monetary policy will likely have to do heavy lifting, boosting risk assets and putting pressure on the dollar,” said Hiroshi Watanabe, economist at Sony Financial Holdings.
Japan’s Nikkei average rose 0.7% to almost its best level in 30 years while MSCI’s broadest gauge of Asian Pacific shares outside Japan rose 0.3%.
U.S. S&P futures dropped 0.3% in early Asian trade, a day after the underlying stock index rose 1.95%.
U.S. Treasury yields drifted lower again as investors bet that a divided U.S. government will cap debt-funded government spending and limit bond supply.
Ten-year Treasury yield edged lower to 0.773%, more than 150 basis points below the pre-U.S. election level seen on Tuesday. It had struck a three-week low of 0.7180% on Thursday.
“There will no longer be the massive largesse people were imagining. After all when it comes to fiscal spending, the Senate really matters,” said Kazushige Kaida, head of FX sales, at State Street Bank’s Tokyo Branch.
U.S. networks project almost no Democratic gains in the Senate, though vote-counting is ongoing.
The Federal Reserve on Thursday kept its monetary policy loose and pledged to do whatever it takes to sustain an unsteady U.S. economic recovery.
With COVID-19 raging in the United States and parts of Europe, many investors assume more monetary stimulus will be inevitable.
The Bank of England expanded its asset purchase scheme on Thursday while the European Central Bank is widely expected to announce more stimulus next month.
Investors also focus on the stalled talks on a U.S. coronavirus relief package.
“We still anticipate that there will be a fiscal package in excess of $1 trillion next year,” said James Knightley, chief international economist at ING Group.
“This stimulus, when combined with a long-anticipated COVID-19 vaccine, can really lift the economy and drive growth. We consequently remain very upbeat on the prospects for 2021 and 2022.”
Trump’s campaign pursued lawsuits challenging the election process in several states but few investors expect him to retain the presidency through the courts.
“Markets think Biden will win even after court battles. There are uncertainties but they are uncertainties with a time-limit,” said Nana Otsuki, chief analyst at Monex Securities.
In the currency market, lower yields undermined the dollar against many currencies.
The dollar index touched a two-month low of 92.473 and last stood at 92.718.
The euro traded at $1.1810 while the offshore Chinese yuan hit a near 2 1/2-year high of 6.6000 to the dollar.
A softer dollar supported the Japanese yen, which climbed to a near eight-month high of 103.43 yen against the dollar overnight. It was steady in early Asian trade at 103.52 yen.
Gold, which is limited in supply and seen as a hedge against inflation in an era of ultra-loose monetary and fiscal policies, eased slightly to $1,942 per ounce after jumping over 2% overnight.
Oil prices were sluggish after a bout of profit-taking in early trade. Brent crude was down 1.73% at $40.22 a barrel.
Even gold, a traditional safe-haven asset, rallied overnight as investors looked forward to the conclusion of the U.S. election as a precursor to more fiscal stimulus in the world’s largest economy.--BBC
Apple must face shareholder lawsuit over CEO Cook's China sales comments
(Reuters) - Apple Inc has been ordered to face a proposed class-action lawsuit by shareholders who accused Chief Executive Tim Cook of concealing falling demand for iPhones in China, resulting in billions of dollars of investor losses.
In a decision on Wednesday, U.S. District Judge Yvonne Gonzalez Rogers said shareholders led by a UK pension fund can sue over Cook’s comment on a Nov. 1, 2018, analyst call that while Apple was facing sales pressure in some emerging markets, “I would not put China in that category.”
Apple told suppliers to curb production a few days after Cook spoke, and on Jan. 2, 2019, unexpectedly cut its quarterly revenue forecast by up to $9 billion, which Cook blamed in part on pressure on China’s economy from U.S.-China trade tensions.
The lowered revenue forecast was the first by Cupertino, California-based Apple since the iPhone’s launch in 2007. Shares of Apple fell 10% the next day, erasing $74 billion of market value.
Apple and Cook have said there was no proof they defrauded or intended to defraud the plaintiffs. The company did not immediately respond on Thursday to requests for comment.
In a 23-page decision, Rogers said shareholders plausibly alleged that Cook’s statements on the analyst call about China were materially false and misleading.
She said that while Cook might not have known specifics about “troubling signs” in China that the company had begun seeing, it “strains credulity” he would have been in the dark about the trade tensions and their possible impact on Apple.
The plaintiffs raised a “strong inference” that Cook knew about the risks when discussing China on the analyst call, and a “cogent and compelling inference that Cook did not act innocently or with mere negligence,” Rogers wrote.
Rogers, who works in Oakland, California, also dismissed claims related to demand for the iPhone XS and XS Max.
The plaintiffs are led by the Norfolk County Council as Administering Authority of the Norfolk Pension Fund, located in Norwich, England.
The case is In re Apple Inc Securities Litigation, U.S. District Court, Northern District of California, No. 19-02033.—BBC
Wall Street rallies as investors eye split U.S. Congress
(Reuters) - U.S. stocks jumped on Thursday as investors bet Republicans would hold onto the Senate and prevent changes under a possible Joe Biden White House that would crimp corporate profits.
With votes still being counted in battleground states, investors abandoned cautious pre-election positioning, driving Wall Street’s main indexes up for a fourth straight session.
S&P emini futures dipped 0.3% late in the day as Democratic candidate Biden edged closer to defeating Republican President Donald Trump, with the contest hinging on a dwindling number of uncounted votes..
While investors widely expect a fiscal stimulus package, the size of a deal reached in a divided Congress is likely to be much smaller than it would be under a Democratic-controlled Congress. That could pressure the U.S. Federal Reserve to pump more funds into the financial system, supporting equity prices.
Also on Thursday, the Fed kept its loose monetary policy intact and again pledged to do whatever it can to sustain an economy crippled by the coronavirus pandemic. In a post-statement press conference, Chair Jerome Powell said the Fed would not consider directly funding fiscal activities.
“They stayed with what the market had expected,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. “Given the scenario of an election where you’re still counting ballots, it would be very difficult for the Fed to insert itself at this point.”
Betting odds heavily favor Biden, with the Smarkets betting website now reflecting a 10% expectation Trump will retain the presidency.
However, Democrats appeared less likely to win the Senate from Republicans. That eased investors’ worries about tighter regulations on Big Tech and a potential corporate tax hike.
The Dow Jones Industrial Average rose 1.95% to end at 28,390.18 points, while the S&P 500 gained 1.95% to 3,510.45.
The Nasdaq Composite climbed 2.59% to 11,890.93.
Volume on U.S. exchanges was 10.42 billion shares, more than the 9.16 billion average for the full session over the last 20 trading days.
The S&P 500 has surged over 7% so far this week, its strongest four-day gain in nearly seven months.
Since Election Day on Tuesday, the S&P 500 has rallied 4%, while Facebook has jumped 11% in the same period, with investors betting on reduced risk of antitrust scrutiny.
The tech-heavy Nasdaq, packed with “stay-at-home” corporate winners under this year’s was within striking distance of its Sept. 2 record closing high.
Qualcomm Inc rocketed almost 13% higher after the chipmaker forecast fiscal first-quarter revenue above estimates as it predicted solid growth in 5G smart phones sales next year.
Nigeria: Aviation Minister Explains Why Nigerian Airlines Fail
The Minister of Aviation, Senator Hadi Sirika has identified poor business plan, high cost of maintenance, choice of operational equipment, high interest on loans and poor corporate governance as some factors responsible for the failure of Nigerian airlines.
Nigerian airlines have average of 10 years lifespan and many of them have gone under in the past 20 years. Some of them include Triax, Okada, ADC Airlines, Chanchangi, Oriental Airlines, Al Barka, Kabo, Sosoliso, Bellview and Afrijet, among others.
The minister said if the cost of operation is low, cost of tickets would be lower and more people would travel by air.
The minister said most Nigerian airlines have poor business plan and this include their administrative system, choice of aircraft, choice of routes, choice of manpower and financial management.
On the choice of aircraft, he said because the average distance between two cities in Nigeria is about one hour, Nigerian airlines should acquire small body aircraft that are new and less costly to maintain. These types of airlines consume less fuel and also break-even at 50 per cent load factor.
He said some poor critical decisions made by the management of the airlines led to their demise because airlines operate on a very low profit margin, but they generate high revenue. Owing to this, some owners misapply the funds and then fail to pay for aircraft maintenance, pay for fuel, pay for overheads and charges and then fail to pay the workers.
The minister also said airlines borrow short-term loans at high interest rate of about 25 per cent, adding that because they operate at very low profit margin they find it difficult to cope and pay back these loans.
Due to this, the federal government has advanced plans to arrange a system whereby airlines can access credit facility at long-term, single digit interest rate.
On corporate governance, the minister said many of Nigerian carriers run a one man management system where the owner of the company call the shorts without following procedures and processes and without engaging professionals experienced in the industry to make critical decisions on the operation of the airlines.
On aircraft maintenance, the minister said Nigerian carriers pay hugely to maintain their aircraft overseas because there is no major maintenance facility in Nigeria and the ones located in Morocco, Ethiopia and Egypt are too busy that they rarely have space for Nigerian carriers; so Nigerian airlines ferry their aircraft overseas in the US, or Europe where they wait for slot and still pay for accommodation and parking fees while waiting for their turn to take in their aircraft for maintenance.
According to the minister, it is because of the critical need of having a maintenance facility in Nigeria that the federal government decided to establish a maintenance, repair and overhaul (MRO) facility, saying if the cost of operation is low for the airlines, the cost of air tickets would also be affordable to average Nigerians to travel by air.
"The lower the charges the better for the aviation business because it will bring down the cost of tickets. But airports must be run and run for profits. For example, Overland Airways has been operating for a long time because they operate aircraft that are cheaper to maintain.
"Since I became Minister I have approved every request made by airlines to import aircraft but if you look at their business plan you see they make bad decisions that lead to their failure. For example, Aero Contractors has been operating for almost 60 years but at a point they changed their business plan and started having challenges. The Nigerian Civil Aviation Authority (NCAA) could be held responsible to some extent because they approve these business plans.
"So the funding of airlines is a problem because of the high interest rate on loans. Twenty five per cent interest rate is very high. Source of funding is very important and that is why we have reached an advanced stage for funding for the aviation industry," the minister said.
Senator Sirika also said many Nigerian airlines acquire old aircraft and these equipment are costly to maintain and because many of the airlines do not have good business plan they lose money.
"Old planes are cheap but they are costly to maintain. This is part of the plan I am talking about.
"Because of bad planning I know an airline that lost $20 million before it started operations, but I must say that while turboprops and other smaller plans are more economical to operate, I must admit that many Nigerians prefer to travel with jet engine aircraft but smaller planes are becoming more efficient," the Minister said.
But the Managing Director of Overland Airways, Captain Edward Boyo, had said that over 100 domestic airlines have died in the last 20 years due to unfavorable business environment and charges.
Boyo asked for most of the charges including corporate interest tax, educational tax, Federal Inland Revenue Service Tax, local government charges, PSC, TSC/CSC which he said were close to 35 in all, to be abolished as his airline has survived this far because of his business model, adding that if the unfavorable operational environment continues, he might not be sure that his airline would survive.-This Day.
Nigeria: Oil Price Slump Threatens 2021 Budget - Govt
The Minister of Finance, Budget and National Planning, Zainab Ahmed, has said the resurgence of COVID-19 in Europe, which has caused oil prices to decline in the international market, may affect the 2021 budget estimate.
The 2021 budget is predicated on $40 per barrel but the current price in the market stands at $37.
Ahmed made the statement on Thursday when she appeared before the Senate Committee on Finance to defend her ministry's budget.
The chairman of the panel, Senator Adeola Olamilekan (APC, Lagos) had asked the minister about the contingency plans the federal government has put in place to insulate the budget from the shocks of falling oil price.
"The actual projection was $40 per barrel and that is the average price that we projected for the year. Some of the institutions that are responsible for tracking the price of crude oil, actually have crude oil prices going as far as $50, $52 per barrel.
"We took the safer path. It seems the second wave of COVID-19 in Europe is affecting us. We are hoping to have clarity as to which direction to take in the next week or two," she stated.
The minister, however, dismissed insinuations that the federal government may increase Value Added Tax (VAT) again by 2.5% in 2021.
"As for the finance bill, we have the draft. There will be no increase in VAT or any form of taxes because we see 2021 as a year of recovery."
When they appeared to defend their budgets, almost all the heads of the agencies under the committee's supervision lamented that their budgetary allocations were too meagre to meet their obligations.
The Accountant General of the Federation, Ahmed Idris, said his agency has 37 offices in dire need of rehabilitation. But the finance minister said the budget office could not go beyond available resources.
"Everybody is claiming scarce resources, but we can't go beyond what is available," the minister said.
The Director General, Budget Office, Ben Akabueze, said until the federal government gets more revenue, no agency of government would get enough allocation.-Daily Trust.
Chad: Govt to Resume Oil Exploration in Lake Chad Basin
Maiduguri — The federal government last Wednesday said the crude oil exploration in the Lake Chad Basin will commence soon.
The oil exploration in the area was suspended by the Nigerian Government in July 2017 after suspected members of Boko Haram sect attacked a team of geological engineers from the University of Maiduguri who were engaged by Nigeria National Petroleum Corporation (NNPC) to carry out a survey of the Lake Chad region in Borno State towards the commencement of oil exploration.
The Minister of State for Petroleum Resources, Mr. Timipre Sylva, while addressing journalists after a closed-door meeting in Maiduguri with the military and chief executive officers in the oil sector, said the area is now peaceful enough to commence the oil exploration.
Sylvia said the relative peace in Borno State and the Lake Chad basin informed the decision to move in for exploration and drilling activities in the oil rich region.
According to him, "We are here to thank the Chief of Army Staff and the Nigerian Army for the great job they continue to perform in the North-east region. We believe that without their gallant activities here, we in Abuja would not be living safely. Having thanked the army, we also want to start exploration and drilling activities here because we believe that there is relative peace in the area.
"As you may know, we have found crude oil in Gombe State, and we believe that there is a lot of oil to be found in the Lake Chad Basin. We have seen a lot of prospects in the Chad Basin, and we want to commence exploration and drilling activities there, and that is why we are collaborating with the Nigerian army to ensure that security is provided for activities to commence very soon."
The minister commended the sacrifice and gallantry of the Nigerian army in the fight against insurgency in the North-east region.
He also sought the collaboration of the Chief of Army Staff in providing adequate security to secure the installations and workers on the field.
The Minister of State for Petroleum was accompanied on the visit by the Group Managing Director of NNPC, Alhaji Mele Kyari; Group General Manager Frontier Exploration Services, Abdullahi Bomai among other officers.- This Day.
Tanzania - Internet Slowdown Comes At a High Cost
Tanzania's internet and social media have been disrupted for more than a week, at great cost to the economy and free speech. The slowdown started just before Tanzania's presidential elections.
Network marketeer Prosper Makungu depends on the internet to conduct his business in Dar es Salaam, Tanzania's biggest city.
On average, Makungu reaches out to 10 clients a day, earning his company between $100-200 (€85-170) and himself a nice commission.
But ever since internet and social media services were restricted in the days before Tanzania's general elections on October 27, Makungu barely manages to make two sales a day.
"I cannot send products to clients in picture or video format because they're too heavy for the slow internet," Makungu told DW. "Normal access comes for a very short time and when so many people are using the same network, many activities come to a standstill."
Makungu's story is shared by many young users and entrepreneurs who have turned to the internet as a source of income. The majority of young people struggle to find a regular job in Tanzania.
"We were using the internet to do a lot of things and now we are in the dark," said a young female journalist, who preferred not to be named for fear of reprisal. "What they are doing to us is very unfair."
Internet, social media slowed down
NetBlocks, an internet services watchdog, has reported "widespread disruption" to internet services in Tanzania as well as restrictions to popular social media applications, like Facebook, WhatsApp, Twitter and YouTube.
While some savvy social media users manage to bypass the restrictions by using a virtual private network, or VPN, the workaround is illegal in Tanzania.
An official with Tanzania's communications regulator confirmed to DW that the internet shutdown had been sanctioned by the government of President John Magufuli, who was sworn in for a second term on Thursday.
The official requested not to be named since he was not authorized to speak about the matter.
During his first term, Magufuli was accused of cracking down on dissent and restricting freedom of the press.
Activists criticize communications slowdown
"We call upon the Tanzania Communications regulatory authority to takes steps to restore the internet because social media plays an important role in the provision of social and economic services," said Anna Henga, Executive Director of Legal and Human Rights Centre.
In a statement, the organization described the slowdown as a violation of human rights in a country whose constitution guarantees citizens the right to information via various sources, both locally and internationally.
Tanzania's communications regulator spokesperson, Sema Mwakyanjala, said the government was working in collaboration with service providers to restore the internet, although he was reluctant to say whether the authority had known about the slowdown.
"Users should communicate with service providers regarding any issues with internet access," he told DW, adding that the problem would be soon solved.
Internet central to many young people's livelihoods
Analysts say the impact of the communications slowdown has been immense. Tanzania has more than 2 million internet users and many of these, especially young people, can't earn money without the internet.
Bravious Kahyoza, a lecturer of economics at the Dar es Salaam-based Kampala International University, estimates between 15 - 27% of young people's income is made online.
E-business, especially, is growing in importance in Tanzania, he pointed out. This includes starting and coordinating projects, and getting information in real time such as how markets are trending.
But, he says, internet disruptions around the elections have limited this kind of coordination between Tanzania and other countries, Kahyoza said in a telephone interview with DW.
Muzzling free speech
Since Magufuli came to power five years ago, Tanzania has passed a raft of laws that muzzle the media and stifle free speech, analysts say. For instance, bloggers now have to register and pay expensive licensing fees of around $900.
Civicus, a civil society monitor, says Tanzania has suffered a "dramatic decline" in freedom of expression.
But President Magufuli has never appeared to be a fan of the internet, especially social media, which he sees as hindering his "Hapa Kazi tu" (Here it's just work) slogan that he's famous for.
"I was wishing that angels descend from heaven one day and close all these platforms, so that when they are reopened after one year, we have already built our new Tanzania," Magufuli said while addressing a gathering two years ago.
Malawi: MCCI Cancels Malawi International Trade Fair Due to Covid-19
Malawi Confederation of Chambers of Commerce and Industry (MCCI) has cancelled this year's international trade fair due to coronavirus pandemic (Covid-19).
MCCI head of Business Link and Events Linda Bete said the international trade fair could not be held in view of the government strict Covid-19 measures.
"We have to protect both the local and international traders against covid-19," she said.
The trade fair is usually held in May each year in Blantyre but this year it was rescheduled to September before MCCI decided to cancel it completely this year.
Mike Mlombwa, president of the Indegenous Businessmen Association said the decision to cancel the international trade fair was regrettable though justifiable in the wake of devastating virus cases in the world.-Nyasa Times
Kenya: Safaricom Introduces Four New Prefix Numbers
Safaricom has introduced four new prefix numbers.
The new phone number prefixes beginning with 0112, 0113, 0114, and 0115 will be available free of charge with customers only required to activate their lines with a top-up of Sh50 airtime after choosing the phone number they wish.
The move to release the new series of numbers is necessitated by increased demand for SIM cards, mobile data and machine-to-machine communication, and other emerging technologies that require telecommunication numbers.
"20 years ago, we began Safaricom with 17,000 customers and a commitment to our community to transform lives. Our customers have grown to more than 35 million today on the back of our commitment and our constant investment in innovation. The new phone numbers we are launching today will help meet a strong demand for our services that is especially driven by new mobile data customers," said Peter Ndegwa, CEO, Safaricom.
The move is part of the company's customer initiatives to mark 20 years since the company was launched in Kenya, with the new numbers available at all Safaricom shops, dealer outlets and agents countrywide.
The launch of the new numbers also comes hot on the heels of the 0110 and 0111 prefixes introduced in February.
Kenyans seem to have warmed up to the new numbers that break away from the traditional 07***.
Other Safaricom prefixes include 070X, 071X, 072X, 0740-43, 0745-46, 0748, 0757-59, 0768-69 and 079X.
The new prefix numbers were launched by the Communications Authority (CA) in May 2019.
"The introduction of the new mobile numbering prefix 01 is in line with National Numbering Plan developed in 2002 by the Authority, in consultation with ICT industry operators and other stakeholders," the authority said then in a statement then.-Nairobi News.
Gambia: Asky Airlines Resumes Flight to Destination Gambia Today
As Destination Gambia is set to resume tourism session for 2020 winter tourism season, the latest airline to announce its readiness to resume flights to the destination is ASKY Airlines.
Information from Adama Njie, director of Marketing Gambia Tourism Board says in a statement from the management of the airlines "that ASKY, the Pan African Airlines is pleased to resume flights to Banjul, effective 5 November, 2020."
According to the airlines scheduled, Mr. Adama said "the Pan African Airlines operation is Accra to Banjul flights scheduled for every Tuesday, Thursday, Friday and Sunday respectively."
He noted that the complete schedule and fares, according to the ASKY Airlines statement, are available in all GDS for sale.
"This is good news for the destination especially now that the Ministry of Tourism and Culture and Gambia Tourism Board is working vigorously on regional tourism," Mr. Adama noted.
Meanwhile ASKY Airlines hub is at Lome - Tokoin Airport, Togo. It begins its operational flights to Gambia in 2010.
Speeding car renders all passengers in critical condition
Appeal case for 7 treason convicts set for judgment-The Point.
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INVESTORS DIARY 2020
Company
Event
Venue
Date & Time
Natfoods
AGM
Royal Harare Golf Club
09/11/2020 | 8:45am
Afdis
AGM
virtual
13/11/2020 | 12:20pm
Simbisa Brands
AGM
SAZ, Northend Close, Borrowdale, Harare as well as virtually on: https:/escrowagm.com/eagmZim/Login.aspx
20/11/2020 | 8:15am
Axia Corporation
AGM
virtual https://escrowagm.com/eagmZim/login.aspx
24/11/2020 | 8:14am
Zimbabwe
National Unity Day
Zimbabwe
22/12/2020
Christmas Day
25/12/2020
Boxing Day
26/12/2020
New Year’s Day
01/01/2021
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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