Major International Business Headlines Brief::: 17 October 2020

[Bulls n Bears]

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Major International Business Headlines Brief::: 17 October 2020

 


 

 


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

 


 

 


 

 

ü  Brexit: Trade talks with the EU are over, says No 10

ü  Israel-UAE peace deal 'big' for trade in Middle East

ü  Instagram targets rule-breaking influencers

ü  British Airways fined £20m over data breach

ü  Covid: One-way 'travel bubble' opens between Australia and NZ

ü  Seychelles Planting Hectares of Fruit Trees to Increase Food Security

ü  South Africa: SA Recovery Plan to Improve Economic Growth

ü  Zambia: Govt's Debt Crisis Worsens

ü  Mozambique: Court Orders Dissolution of Fraudulent Companies

ü  Nigeria: CBN Invests N120 Billion to Revive Textile Sector

ü  Namibia: Govt to Determine Value of Exported Timber

ü  Wall Street Week Ahead: Big tech nervousness prompts calls to diversify

ü  U.S. retail sales blow expectations in September; dark clouds gathering

ü  Twitter backtracks, allows users to post previously blocked NY Post article

ü  Oil dips on COVID-19 resurgence, fears of more supply

 

 

 

 

 

 

 

 

 

 

 


 <http://www.spidexmedia.com/> 

 


 

Brexit: Trade talks with the EU are over, says No 10

The PM says it is time to "get ready” for trading arrangements with the EU to be "more like Australia's" from 1 January.

Talks between the UK and EU over a post-Brexit trade agreement are "over", Downing Street has said.

 

No 10 argued there was "no point" in discussions continuing next week unless the EU was prepared to discuss the detailed legal text of a partnership.

 

UK chief negotiator Lord Frost said he had told EU counterpart Michel Barnier there was now no "basis" for planned talks on Monday.

 

Number 10 said the two sides had agreed to talk again next week - by phone.

 

Earlier, EU Commission President Ursula von der Leyen tweeted that the Brussels negotiating team would go to London after the weekend to "intensify" discussions.

 

The prime minister had set this week's EU summit as the deadline for the two sides to agree a deal.

 

But there are still major disagreements over fishing rights and state help for businesses.

 

And the UK government hardened up its message to the EU over the course of Friday.

 

In the morning, Boris Johnson said the country had to "get ready" to trade next year without an agreement, although he did not say the talks were over.

 

He suggested the EU was unwilling to consider seriously the UK's preferred option of a comprehensive free trade agreement based on the bloc's existing arrangement with Canada.

 

The UK, he added, must look at the "alternative" - which he suggested was Australia's much-more limited set of agreements with the EU.

 

"The talks are over."

 

As statements go, those four words from the prime minister's spokesman this afternoon were something of a bombshell.

 

But Michel Barnier, due to come to London next week to continue talks, might not be unpacking his briefcase just yet.

 

There's no doubt that Downing Street is sending the clearest signal possible that it expects the EU to make the next move.

 

And the rhetoric accompanying the talks has reached a new level.

 

But both sides still want a deal, the process has not broken down and there is still time to reach an agreement.

 

It's one thing to declare the talks over; it's another thing to refuse to continue talking.

 

Presentational grey line

The prime minister's official spokesman took a tougher line with Brussels later in the day.

 

"There is only any point in Michel Barnier coming to London next week if he's prepared to address all the issues on the basis of a legal text in an accelerated way, without the UK required to make all the moves or to discuss the practicalities of travel and haulage," he said.

 

"If not, there is no point in coming."

 

What is a 'Canada-style' trade deal?

Brexit: What is the 'no-deal' Australia option?

He added: "Trade talks are over. The EU have effectively ended them by saying they do not want to change their negotiating position."

 

The UK and EU had been hoping for a "zero-tariff" agreement to govern their trading relationship once the UK's post-Brexit transition period ends on 31 December.

 

If no deal is reached, they will operate on World Trade Organization rules, meaning tariffs are imposed.

 

Boris Johnson's public declaration that the UK should prepare for no deal did not cause great concern within EU circles.

 

The immediate response came in a tweet from Commission President Ursula von der Leyen who said it was full steam ahead for trade talks next week and that EU negotiators would be getting on the Eurostar to London as planned.

 

But the subsequent statement from the prime minister's official spokesman that the "trade talks are over" has left senior diplomats "deeply unimpressed", as one put it.

 

Although "we're getting used to being part of Johnson's pantomime", they added.

 

Some EU figures fear Boris Johnson still doesn't know if he actually wants a deal and is trying to buy time while he grapples with the Covid crisis.

 

Following the hardening of the British position by No 10, France's President Macron called on the prime minister to make up his mind, while there was still time.

 

Many in Brussels remain "cautiously optimistic" some sort of deal can be agreed, but any route there is now even harder to see.

 

After the EU summit concluded on Friday, German Chancellor Angela Merkel said it would be best to get a deal and that compromises on both sides would be needed.

 

French President Emmanuel Macron said the UK needed a Brexit deal more than the EU did.

 

For Labour, shadow Cabinet Office minister Rachel Reeves urged the UK government to "step back from the brink" and "stop posturing".

 

"Any tariffs or any delays at the border will make it harder for goods to flow freely, whether those are foods or medicines," she said.--BBC

 

 

 

 

Israel-UAE peace deal 'big' for trade in Middle East

Israel's peace deals with the UAE and Bahrain are "going to be big" for business and trade in the region, one of the most influential businessmen in the Middle East has told the BBC.

 

Sultan Ahmed bin Sulayem, the chairman and CEO of Dubai-based DP World, says they will remove barriers to business links previously "not allowed", by shortening trade routes and making it easier to deal with Europe.

 

Israeli estimates suggest trade with the UAE could eventually total $4bn a year, creating 15,000 jobs.

 

Mr bin Sulayem agrees it would be mutually beneficial: "We need something from Israel, they need something from us".

 

Many exports are likely to be technology based, including cyber-security, as well as the latest innovations in medicine and agriculture.

 

Trade is also likely to grow to include more physical goods with many Asian exports flowing through Dubai.

 

This week, the MSC Paris became one of the first cargo ships to make the voyage between the two countries, and Israel's parliament formally approved the treaty with the United Arab Emirates.

 

Israeli's Prime Minister Benjamin Netanyahu called the shipment of electronics, cleaning supplies, iron and firefighting equipment the "beginning of something huge".

 

DP World is the world's biggest ports operator and is working with Israel's DoverTower to expand its presence in the country. Israel is looking to upgrade port facilities at Ashdod and Haifa that are crucial to its economy.

 

It is this ambition to broaden its presence that Mr bin Sulayem says has helped his company outperform the rest of the cargo industry during the Covid-19 pandemic.

 

Before the pandemic, DP World handled 10% of all the shipping containers that are used to move everything from electronics to clothes and car parts around the world. The number of those containers is set to fall this year with the IMF predicting that the global economy will shrink 4.4%.

 

"It's been very tough for everybody," says Mr bin Sulayem.

 

"All the shipping companies, port operators, logistics operators were shocked because of the lockdown and many of the procedures they [now] have to do."

 

In the first six months of 2020, DP World handled 33.9m TEU (twenty-foot equivalent units). That is a 3.9% fall in the number of shipping containers compared with the same time in 2019, with the biggest fall in the Americas and Australia.

 

But that is better than the 5.6% global fall estimated by the maritime research firm Drewry.

 

"Trade has been pretty resilient", says the firm's container research expert Simon Heaney, who says the lifting of restrictions means it is likely for the year as a whole that global trade will only be down 3.3% - with North America and Europe leading the recovery.

 

Mr bin Sulayem says his company's relatively strong performance has been because "we have locations throughout the world so we don't get affected in one place".

 

He explains: "We are not just affected by one part of the world, we are actually almost spread evenly around the world between the Far East and Europe to Latin America, Australia and Africa. We believe that by the end of the year we'll be affected by less than 6%."

 

The pandemic has accelerated the rollout of new technology across the company which he says has led to more automation and "better productivity".

 

Another big task for the ports giant has been trying to stop Covid-19 outbreaks at its 127 operations around the world. There have been several outbreaks on cargo vessels and Mr bin Sulayem says it is a real challenge for the industry.

 

Most countries have imposed strict limitations around crew changes, making it hard for those who work on cargo ships to come ashore and interact with port staff.

 

Physical distancing and a strict cleaning regime have been at the heart of DP World's operations says Mr bin Sulayem: "We basically segregate. We are not allowed to mix with them, we clean, we disinfect anything that we touch."

 

DP World, he says, is careful to "really adhere" to the rules in each of the countries it operates in and that the priority is protecting its more than 56,000 workers.--BBC

 

 

 

Instagram targets rule-breaking influencers

Instagram says it will do more to catch influencers who fail to disclose when they have been paid for their posts.

 

It follows an investigation by a UK watchdog which found the platform was failing to protect consumers from being misled.

 

Instagram will also report users who inadequately label their posts to the businesses whose products they endorse.

 

In the UK, social-media stars have to make clear if they are being paid by a company to promote its business.

 

They often do this by including the hashtag '#ad' in such posts.

 

Instagram's new tools, which will be rolled out over the next year, include a prompt requiring influencers to confirm whether they have received incentives to promote a product or service before they can publish their post, and new algorithms built to spot potential advertising content.

 

The Competition and Markets Authority (CMA) said its investigation had shown that many influencers were not adhering to the rules.

 

The watchdog called Instagram's move "an important behavioural shift" for social-media platforms.

 

“This will make it much harder for people to post an advert on Instagram without labelling it as such,” a spokesman said.

 

Last month, research found that "more than three-quarters" of influencer adverts on Instagram buried their disclosures within their posts.

 

'Selling out'

Sara Tasker, an Instagram coach and author, said the driving force for influencers trying to disguise endorsements stemmed from perception.

 

"They don't want to turn their audience off with ads, or risk a drop in engagement or losing followers by being seen to 'sell out'," she said.

 

"Clear disclosure regulation means the content can speak for itself, and puts the onus back on the influencers to create posts that are valuable and relevant, regardless of payment or #ad," she added.

 

Influencers have become the new frontier for many companies who are looking to target younger consumers.

 

According to social-insights firm Captiv8, influencers with more than a million followers on Instagram can earn up to $20,000 (£15,500) per post they make on behalf of advertisers.

 

Forbes recently predicted huge growth in the influencer space, suggesting the market could be worth £11bn by 2022.

 

Last year, 16 social-media stars, including singers Ellie Goulding and Rita Ora, and models Rosie Huntington-Whiteley and Alexa Chung, pledged to change how they post online.

 

Their message followed warnings from the CMA that their posts could break consumer law.--BBC

 

 

 

 

British Airways fined £20m over data breach

British Airways has been fined £20m ($26m) by the Information Commissioner's Office (ICO) for a data breach which affected more than 400,000 customers.

 

The breach took place in 2018 and affected both personal and credit card data.

 

The fine is considerably smaller than the £183m that the ICO originally said it intended to issue back in 2019.

 

It said "the economic impact of Covid-19" had been taken into account.

 

However, it is still the largest penalty issued by the ICO to date.

 

The incident took place when BA's systems were compromised by its attackers, and then modified to harvest customers' details as they were input.

 

It was two months before BA was made aware of it by a security researcher, and then notified the ICO.

 

How did hackers get into British Airways?

BA boss apologises for data breach

The data stolen included log in, payment card and travel booking details as well name and address information.

 

A subsequent investigation concluded that sufficient security measures, such as multi-factor authentication, were not in place at the time.

 

The ICO noted that some of these measures were available on the Microsoft operating system that BA was using at the time.

 

"When organisations take poor decisions around people's personal data, that can have a real impact on people's lives. The law now gives us the tools to encourage businesses to make better decisions about data, including investing in up-to-date security," said Information Commissioner Elizabeth Denman.

 

British Airways said it had alerted customers as soon as it had found out about the attack on its systems.

 

"We are pleased the ICO recognises that we have made considerable improvements to the security of our systems since the attack and that we fully co-operated with its investigation," said a spokesman.

 

Data protection officer Carl Gottlieb said that in the current climate, £20m was a "massive" fine.

 

"It shows the ICO means business and is not letting struggling companies off the hook for their data protection failures," he said.

 

It's taken more than two years for BA to face the music over this extremely serious incident.

 

The company breached data protection law and failed to protect themselves from preventable cyber attack. It then failed to detect the hack until the damage was done to hundreds of thousands of customers.

 

The lag between incident and fine has raised eyebrows in privacy circles but I understand the Information Commissioner's Office has been working methodically to get it right. This is the commissioner's first major fine under the EU data regulation GDPR and was being watched closely by the rest of Europe as a potential landmark decision.

 

The final figure of £20m has come as a shock to many who were expecting it to be closer to the eye-watering £183m initially proposed but it is still a significant moment for data privacy and GDPR. Other companies will look at the fine as a shape of things to come if they also fail to protect customers.

 

In a post-Covid world, the ICO may not be as gentle.--BBC

 

 

 

 

Covid: One-way 'travel bubble' opens between Australia and NZ

The first passengers from New Zealand have arrived in Australia under new "travel bubble" arrangements between the two countries.

 

None of the passengers on the flight from Auckland to Sydney will be required to quarantine in Australia.

 

However they will have to pay for their own quarantine in a hotel when they return to New Zealand.

 

At the moment, the bubble is one-sided, with Australians not allowed to enter New Zealand.

 

Australia and New Zealand are among the first countries in the Asia-Pacific region to loosen restrictions on international travel since Covid-19 travel bans came into effect earlier this year.

 

Singapore and Hong Kong announced on Thursday that they had agreed to quarantine-free travel between the two cities. They did not say when travel would begin.

 

Limited travel and expensive holidays

The bubble currently applies only to the state of New South Wales and the Northern Territory, but Australian officials said they hoped to expand to other states soon.

 

Under the deal, New Zealanders can travel quarantine-free to Australia if they have not been to a Covid-19 hotspot for 14 days.

 

But a holiday in Australia could be expensive. Upon their return, New Zealand passengers will have to quarantine at a cost of NZ$3,100 ($2,045; £1,586) for the first person and more for additional family members.

 

About 90% of those travelling with Air New Zealand on Friday were booked one-way, the airline said.

 

Crew walking past a sign that reads "keeping you safe" at Sydney Kingsford-Smith airport.

 

 

Air New Zealand, Qantas and Jetstar all had flights scheduled to arrive in Sydney on Friday.

 

Upon arrival, passengers from New Zealand are kept separate from other passengers, who will be required to spend two weeks in quarantine.

 

Since March, Australia's borders have been closed to everyone except returning Australian citizens and residents and those with special permission.

 

All arrivals are now required to quarantine at their own expense.

 

There is a backlog of around 29,000 Australians trying to get into the country.

 

New Zealand has recorded 1,880 cases and 25 deaths from Covid-19, while Australia has seen over 27,000 infections and 904 deaths.

 

The majority of Australia's cases have been in the state of Victoria, which enacted tough lockdowns to bring the numbers under control.

 

Green shoots for travel industry

The limited resumption of international travel between Australia and New Zealand could be an early indication of a slight recovery for the travel industry in the Asia-Pacific region.

 

Singapore and Hong Kong's in-principle deal would require travellers between the cities to test negative for Covid-19 with a mutually-agreed polymerase chain reaction (PCR) test.

 

According to the World Travel and Tourism Council, the pandemic led to a 72% drop in international tourists in the first half of the year.

 

However, there has been a rebound in domestic tourism in some markets, such as China.

 

The International Air Transport Association (IATA), which represents 290 airlines, expects traffic to be 66% below the level it was in 2019.

 

The IATA estimates that it will be at least 2024 before air traffic reaches pre-pandemic levels.--BBC

 

 

 

Seychelles Planting Hectares of Fruit Trees to Increase Food Security

With the aim of contributing to the country's food security, Seychelles this week ventured into large-scale agroforestry, planting a diverse variety of fruit trees on several hectares of state land at Montagne Posee.

 

This is part of activities to commemorate the Seychelles Food Week, a national event which coincides with the World Food Day on October 16 celebrated this year under the theme 'Grow, nourish, sustain. Together. Our actions are our future.'

 

The Minister of Agriculture, Charles Bastienne, said on Tuesday that a similar project was carried out on Praslin, the second-most populated island, and at Val D'en D'or, but not on a big scale, to ensure that there is food security in the island nation.

 

"The Montagne Posee project is an ambitious one which will benefit the whole country. The land was covered in invasive plant species and the project which was conceived before the COVID-19 pandemic is based on the idea of valorising the land. It is but the start. We always talk about agroforestry and this particular project is agroforestry on a large scale," said Bastienne.

 

He outlined that having such a large garden of fruits will also ensure that these trees are protected and that also help with propagation as the fruit trees are in high demand by the public.

 

The fruit orchard is expected to cover between 10 to 15 hectares of land. Already breadfruit, mango, avocado, custard apple, soursop, and sapote among others have been planted, all without chemical fertilisers. Prior to the project started, the area was covered in different invasive, indigenous, and endemic plant species.

 

"We are planting these fruit trees in such a way so that they co-habit with the endemic plants that are here. All that is being done under the guidance of the Ministry of Environment, as they are the ones telling us what needs to be cut and what needs to be kept. As much as possible, we are not touching this natural habitat," said Bastienne.

 

The Seychelles Agricultural Agency (SAA) that has the mandate to maintain these trees, will ensure they do not grow extremely tall which will make harvesting a challenge. In the future, trails are expected to be built so that people can walk through the fruit garden.

 

The agricultural minister said that the first trees are expected to start bearing fruits in the next three to five years, however, no decision has been taken yet on if the fruits will be sold.

 

Bastienne also took the opportunity to call upon the public, not-for-profit and private organisations interested in helping the government clear and prepare the land for planting to do so, as the area is really big.- News Agency.

 

 

 

South Africa: SA Recovery Plan to Improve Economic Growth

South Africa's new Reconstruction and Recovery Plan should help unlock greater job creation and faster economic growth.

 

"The plan contains many practical initiatives which together should improve the underlying investment environment and unlock greater job creation and faster economic growth. Much now depends on how quickly the specific measures proposed in the plan can be implemented," Nedbank economists said.

 

Some elements of the plan that was unveiled on Thursday, can be implemented "almost immediately - especially the regulatory reform and the energy sector proposals," said the economists in a research note.

 

"However, the central feature of the plan - the infrastructure drive - will be difficult for government to get off the ground. Even if government managed to overcome its protracted skills and systems constraints in project management, the state will still have to find a solution to the skills exodus and diminished capacity within the construction sector."

 

 

Infrastructure is a key element of the plan announced by President Cyril Ramaphosa with the Infrastructure Fund due to provide R100 billion in catalytic finance over the next decade, leveraging as much as R1 trillion in new investment for strategic infrastructure projects.

 

The plan consists of high-impact interventions to kick-start the economy and to lay the foundation for a sustainable recovery.

 

"The plan rests on an infrastructure expansion drive, which will be partially financed by freeing up private savings currently tied up in pension funds. A key 'enabler' of the plan is to amend Regulation 28 of the Pension Funds Act to unlock this source of funding for long-term infrastructure projects and to facilitate direct access to pension funds by Development Finance Institutions. This is an economically sound method to unlock faster growth," said Nedbank.

 

It said that it is also the key recommendation put forward in the International Monetary Fund's Fiscal Monitor.

 

 

"An effective public investment drive would reduce South Africa's long-standing capacity constraints and create considerable employment, which would over the longer term increase the country's potential growth rate."

 

It said that many countries have used private pension funds to accelerate infrastructure expansion.

 

The economists expressed concern at the country's ability to deliver infrastructure on time and on budget.

 

Fighting corruption

 

In addition, the plan's firm stance against corruption was encouraging.

 

"The most encouraging part of the plan is the focus on fighting corruption. It is essential that government delivers on this promise. It is the key to rebuilding public trust and boosting confidence. Fortunately, the President announced several steps which will go a long way towards this end. The most significant of these is the establishment of an open tender system, which will introduce far greater transparency and accountability to the entire tender process.

 

"Equally powerful is the decision to prohibit any relatives of office bearers to do business with government," it said.-SAnews.gov.za.

 

 

 

Zambia: Govt's Debt Crisis Worsens

Lusaka — Zambia's debt situation seems to be deepening with some commercial creditors "refusing" to grant it some relief it was seeking to ease the pressure, the country's Parliament heard late Thursday.

 

"Although we have obtained some relief under the debt service suspension initiative (DSSI) window, particularly from official creditors, engagements with commercial creditors, have not yet yielded the expected results. This is because these creditors were concerned that we were not treating all creditors equally," Finance Bwalya Ng'andu told the house in a statement.

 

The government seemed to be discriminatory in the treatment of creditors as are servicing certain categories of our debt while not servicing others, he said.

 

Concern was raised that the Eurobond debt was not included in the request and that Zambia had continued to service all Eurobond payments when they fell due, while allowing the accumulation of arrears on other portfolios.

 

 

Dr Ng'andu said the exclusion of Eurobond payments from the DSSI request also made some creditors reluctant to grant it as they were concerned that the debt relief they would provide would be used to pay debt service to other creditors and not be channeled towards covid-19 related expenditures as intended.

 

He also said the "stock of external debt as at end 2019 was at $11.97 billion but added that with the guaranteed debt for state owned enterprises came to $13.55 billion.

 

"I have noted, regrettably, that some sections of the domestic and international society, that may not have read the recently released 2021 international debt statistics report by the World Bank, are quoting government debt as being $27.34 billion as opposed to $11.48 billion at end 2019," he said.

 

The amount stated in the World Bank report refers to the total national debt that includes private sector external debt of $15.57 billion.

 

Zambia has been engaging its creditors to seek their approval for suspension of debt service payments for a period of six months in accordance with the terms of the G20 and Paris Club debt service suspension initiative.

 

Local media quoted Zambia President Edgar Lungu saying the country's debt situation was giving him "sleepless nights".

 

The opposition and civil society have made it a moot point ahead of the 2021 general election.

 

The incumbent regime borrowed heavily to spend on infrastructure and at times to pay civil servants.-Nation.

 

 

 

Mozambique: Court Orders Dissolution of Fraudulent Companies

Maputo — The Maputo City Law Court, at the request of the Mozambican Public Prosecutor's Office, has ordered the dissolution of two fraudulent, security-linked companies, Proindicus and MAM (Mozambique Asset Management).

 

The dissolution of a third company, Ematum (Mozambican Tuna Company) is pending.

 

The first commercial section of the City Court ordered the dissolution after a preliminary hearing with prosecutors on Monday. The technical reason for liquidation is that the liquidity of the three companies has fallen below 50 per cent of their nominal share capital.

 

The companies have not been operating for more than three years. The court-ordered dissolution could lead to selling off whatever assets the companies may have to pay off their creditors.

 

This is the latest stage in the worst financial scandal to hit Mozambique in its entire history. Proindicus, Ematum and MAM were supposedly set up to boost coastal security and to launch a tuna fishing fleet.

 

 

But there was no improvement in coastal security, and the Ematum vessels scarcely ever put to sea. The tuna on sale in Mozambican markets mostly comes from artisanal fishermen, not from Ematum.

 

The three companies obtained loans of over two billion US dollars from the banks Credit Suisse and VTB of Russia. Those loans were only possible because in 2013 and 2014 the government of the time, under President Armando Guebuza, illegally guaranteed the loans.

 

The loan guarantees, mostly signed by the then Finance Minister Manuel Chang, smashed through the ceiling on guarantees set in the 2013 and 2014 budget laws. They also violated a clause in the Mozambican constitution, stating that only the country's parliament, the Assembly of the Republic, can authorise such potential debt.

 

The loans were thoroughly corrupt. Three Credit Suisse bankers closely involved in negotiating the loans, Andrew Pearse, Detelvina Subeva, and Surgan Singh, confessed to US prosecutors that they took large bribes from the Abu Dhabi based group, Privinvest, which was the sole contractor for Proindicus, Ematum and MAM.

 

 

The loans from Credit Suisse and VTB were paid directly to Privinvest. Much of the money was then used to pay off, not only the three Credit Suisse bankers, but also Chang and a number of other Mozambican officials.

 

Privinvest supplied fishing boats and assorted other assets to the three companies. An independent audit found in 2017 that the prices of these assets had been inflated by around 700 million dollars. Despite the weight of evidence against it, Privinvest has repeatedly claimed that it did nothing wrong.

 

Cases related to the loans, the illicit guarantees and the bribes are now slowly moving their way through the Mozambican and British legal systems. Mozambican prosecutors have charged 19 people with a variety of offences including corruption, embezzlement, abuse of office, forgery and forming a criminal association.

 

 

This charged include Ndambi Guebuza, the oldest son of President Guebuza, Gregorio Leao, the head of the intelligence service (SISE) under Guebuza, and Antonio do Rosario, the SISE officer who was chairperson of all three fraudulent companies. No date has yet been fixed for a trial.

 

Since the loans were arranged through the London branches of Credit Suisse and VTB, the Mozambican Attorney-General's Office (PGR) is asking the London courts to annul the 622 millon dollar debt to Credit Suisse incurred by Proindicus, and to order compensation for all the losses Mozambique has suffered because of this scandal.

 

The PGR's case is against Credit Suisse, the three Credit Suisse bankers who have confessed to taking bribes, and Privinvest.

 

The PGR demands that Credit Suisse be held responsible for the entire debt. That would mean annulling the loan of 622 million dollars to Proindicus. In addition Credit Suisse should pay part of the 540 million dollar loans to MAM and the 850 million bond issue to Ematum.

 

The Mozambican case is that the loans to the three companies were just a scheme to extract bribes and kickbacks of about 200 million dollars. The lawyers hired by the PGR argued that "the entire debt was no more than a vehicle for the enrichment of the accused at the cost of the Republic of Mozambique".

 

 

 

 

Nigeria: CBN Invests N120 Billion to Revive Textile Sector

Abuja — The Central Bank of Nigeria (CBN) yesterday said it had invested over N120 billion across the Cotton, Textile and Garment (CTG) value chain since the inception of its intervention programme in the industry.

 

CBN's Deputy Governor in charge of Corporate Services, Mr. Edward Adamu, said at a meeting with stakeholders in the CTG sector in Abuja that over 320,000 farmers had been financed between 2018 to date, adding that expected output for seed cotton is projected to be over 300,000 metric tonnes in 2020.

 

Adamu stated that this is expected to enhance the production capacity of the ginneries in producing over 102,000 metric tonnes of cotton lint, which should meet and surpass the cotton lint requirement of the textile industry in the country.

 

 

According to him, the domestic demand for cotton is currently met through local production, thereby halting the importation of cotton for the textile industry as well as increasing capacity utilisation of ginneries, which now operate throughout the year compared to months in the recent past.

 

The CBN deputy governor added that a total of 19 ginneries had been resuscitated nationwide and more are expected to become operational this year.

 

He said the apex bank's enhanced drive toward anti-smuggling was already yielding positive result with over 15 textile smugglers' accounts frozen.

 

"A lot of progress has been made, but at the same time more needs to be done to ensure that we build an inclusive economy that supports domestic production of goods and services, while offering job opportunities to teeming Nigerians.

 

 

"This assignment has been bestowed upon us all by the President of the Federal Republic of Nigeria, Muhammadu Buhari, who remains extremely supportive of the agricultural sector revolution due to its role in ensuring food security, creating jobs and stabilising the Nigerian economy," he added.

 

Adamu said the revival of the textile sector remained vital to the country's growth objectives, adding that the CBN's interventions are designed to resuscitate and return the industries back to its glorious days of job creation, economic diversification and achieving self-sufficiency in cotton production as well as minimise and eradicate smuggling and dumping of textile goods and facilitation foreign reserves' accretion.

 

On his part, CBN Director, Development Finance Department, Mr. Yila Yusuf, identified smuggling of textiles as the biggest challenge in the efforts to reposition the sector.

 

 

Speaking with journalists, he said, "As you are aware a lot of them (smugglers) their accounts have been blocked. As restitution, we are telling them to go patronise the local textile factories".

 

He said the CBN was also working with the uniform services to enhance patronage of locally-made fabrics which are of high quality.

 

While addressing concerns raised by stakeholders on early funding to check arbitrage by middlemen, he said the CBN would ensure that farmer get funded with the right interest regime.

 

The President of National Cotton Association of Nigeria, Mr. Anibe Achimugu, stressed the need for farmers to access funding from the Export Development Fund (EDF) to help them remain competitive.

 

He said: "As we speak we have excess cotton in warehouses because the current capacity of the textile companies is not able to utilise the cotton for now. But of course, since the CBN is intervening in the textile companies, they should be able to improve their capacities going forward.

 

"Quality planting seeds are not available on the quantity needed. We only have an institute of agricultural research but that is not enough. But the government can open up the space for the private sector in seed production and processing."-This Day.

 

 

 

 

Namibia: Govt to Determine Value of Exported Timber

Forestry minister Pohamba Shifeta yesterday told lawmakers the authorities will investigate and establish the total volumes and value of rosewood exported over recent years.

 

He said this when responding to United Democratic Front parliamentarian Apius !Auchab who wanted to know how much the country has lost in recent years in monetary terms while it has been faced with the growing issue of raw rosewood timber being exported to foreign markets.

 

An astronomic amount of the country's raw timber has over the years been exported to Asia, mainly China and Vietnam.

 

This is despite the Forest Act of 2001 prohibiting the export of unprocessed forest produce, including semi-processed planks.

 

Shifeta said the ministry is in the process of reviewing the Forest Act of 2001 and its regulations.

 

Through such exercise, Shifeta said, they are putting in place clear definitions for what constitutes processed, unprocessed, semi-processed timber. "

 

 

"It is unfortunate that this grey area exists due to the fact that ‹processed› is not defined in the current Act and its regulations," he said, adding that it is regrettable that this loophole has been exploited by harvesters in recent years.

 

This, he added, is also one of the reasons why the ministry issued a press statement in August this year clarifying in no uncertain terms that no export permits would be issued for any unprocessed or semi-processed timber except for research, education, cultural or scientific disease identification as stated in regulation 12(3) of the Act.

 

He said the lack of a definition for what constitutes ‹processed› timber therefore makes it difficult to estimate the total rosewood illegally exported as some of this is likely to have been processed when exported, while other consignments may have been semi-processed or un-processed.

 

 

On what the ministry has put in place at promoting the sustainable utilisation of timber and forest resources as well as stimulating lasting and sustainable economic growth and employment creation in the country, Shifeta said the process is being carried out on multiple fronts and in full collaboration with a number of other key stakeholders.

 

Firstly, he said, the ministry took the difficult decision to suspend the harvesting, transportation, marketing and export of timber on 26 November 2018.

 

The main reason for this, he said, was to ensure the resources, which are scarce and so precious to Namibia, are utilised on a sustainable basis for the benefit of all the Namibians, both present and future.

 

"I am pleased to report to this august House that the vast majority of illegal operations have been brought to an end and that the situation in the north-eastern regions is now under control," he said. Shifeta also updated parliament on the establishment of a local furniture factory in Kavango West as a means to add value to the country's resources.

 

According to Shifeta, once completed the factory is set to create 50 jobs.

 

"We continue to call on investors to take up opportunities in wood processing to feed the local market and are encouraging all OMAs (government offices, ministries and agencies) and businesses to buy locally produced timber as opposed to importing products such as doors, tables and chairs, so that we grow the industry and create jobs and economic opportunities for Namibian companies and individuals," he said.-New Era.

 

 

 

 

Wall Street Week Ahead: Big tech nervousness prompts calls to diversify

NEW YORK (Reuters) - As a technology-driven rally brings U.S. stock indexes within striking distance of fresh records, concerns that big names are over-extended and that new regulation might be coming have some investors diversifying beyond the rally leaders.

 

The S&P 500's five biggest companies, Apple Inc AAPL.O, Microsoft Corp MSFT.O, Amazon.com Inc AMZN.O, Alphabet Inc GOOGL.O and Facebook Inc FB.O now account for 28% of the index's weighting and have been responsible for 25% of its earnings, Goldman Sachs said earlier this month.

 

On average, these tech and internet-driven stocks have gained 49.23% this year, compared to a 7% gain for the S&P 500 - and are up 9.6% on average since Sept. 21, versus 6.6% for the S&P 500. They are expected to report strong third-quarter earnings in coming weeks, proving their mettle in a year when the coronavirus pandemic fueled a work-from-home economy while devastating companies linked to sectors like travel, restaurants, and fossil fuels.

 

Still, some worry that mega-cap tech companies are exposed to factors that may cut their allure in the months ahead. Being long technology is the most crowded trade of all time, according to a recent Bank of America fund manager survey.

 

“It’s all about trying not to have all your eggs in one basket,” said Laura Kane, head of Americas thematic investing at UBS Global Wealth Management. “It’s about trimming certain exposures and rotating into something else.”

 

UBS analysts have recommended diversifying out of mega-cap tech stocks on signs of an economic recovery and climbing valuations. They urge rebalancing into U.S. semiconductors, which are more sensitive to economic recovery, as well as emerging market value stocks and United Kingdom-based equities.

 

Societe Generale analysts also recently cited a challenging regulatory environment as one reason to diversify out of U.S. tech shares and into Asian ones and European stocks.

 

Regulatory concerns have heightened following a scathing report here detailing market power abuses by Google, Apple, Amazon and Facebook issued earlier this month by the U.S. House Judiciary Committee's antitrust panel. The report has raised concerns that tough new rules and stricter enforcement for big tech companies will follow should Democratic presidential candidate Joe Biden win the White House.

 

A potential breakthrough in the search for a COVID-19 vaccine also could also spur bets on shares of economically sensitive value and cyclical stocks that may benefit from a stronger economic recovery, potentially dimming the appeal of tech, Soc Gen analysts said.

 

The median 12-month forward price-to-earnings ratio for the Big 5 tech stocks is 31, while the S&P 500 trades at a 12-month forward PE ratio of 22, according to Refinitiv. Still, they are not as extended as in the dotcom period, with overall profitability, dividends and balance sheet strength in much better shape than 20 years ago.

 

Companies investors will be watching next week as they report third-quarter results include Netflix Inc NFLX.O on Tuesday, Tesla Inc TSLA.O and Verizon Communication Inc VZ.N on Wednesday, and Intel Corp INTC.O on Thursday. Apple, Amazon, Alphabet, Microsoft and Facebook report the following week.

 

Many investors still see the big tech names, with their strong balance sheets and financial results, as havens as coronavirus cases continue to climb and the economy struggles with a lack of new fiscal stimulus.

 

“These companies deliver powerful profits,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors. “People have to keep in mind that the five largest tech companies make more in earnings than the entire Russell 2000 combined, so this isn’t the internet bubble.”

 

It might be a good idea to trim some tech exposure if the position has gotten too overweighted, but the sector’s gains are largely being driven by fundamentals, said Michael Farr, president of Farr, Miller & Washington LLC.

 

To rotate out of tech because of big gains and some recent volatility would be “a suckers’ trade,” he added. “Reports of their demise have been greatly exaggerated,” he said of the big tech stocks.

 

 

 

 

U.S. retail sales blow expectations in September; dark clouds gathering

WASHINGTON (Reuters) - U.S. retail sales accelerated in September, rounding out a strong quarter of economic activity, but the recovery from the COVID-19 recession is at a crossroads as government money runs out and companies continue to layoff workers.

 

 

New coronavirus cases are also surging across the country, which could lead to restrictions on businesses like restaurants, gyms and bars, and undercut consumer spending. The economy is already shifting into lower gear. Other data on Friday showed an unexpected drop in output at factories last month.

 

“Although sales growth is strong, it will slow through the rest of this year and into next year,” said Gus Faucher, chief economist at PNC Financial in Pittsburgh, Pennsylvania. “The slowing will be even larger if Congress does not pass another stimulus bill. Unemployment remains pervasive throughout the U.S. economy.”

 

Retail sales jumped 1.9% last month as consumers bought motor vehicles and clothing, dined out and splashed out on hobbies. That followed an unrevised 0.6% increase in August.

 

Economists polled by Reuters had forecast retail sales would rise 0.7% in September. Some said September’s surge was likely exaggerated by difficulties stripping seasonal fluctuations from the data after the shock caused by COVID-19. Unadjusted retail sales fell 2.8% after dropping 1.0% in August.

 

Retail sales have bounced back above their February level, with the pandemic boosting demand for goods that complement life at home, including furniture and electronics. An aversion to public transportation has boosted motor vehicle purchases. Retail sales rose 5.4% on a year-on-year basis in September.

 

They account for the goods component of consumer spending, with services such as healthcare, education, travel and hotel accommodation making up the other portion.

 

Excluding automobiles, gasoline, building materials and food services, sales increased 1.4% last month after a downwardly revised 0.3% drop in August.

 

These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product. They were previously estimated to have dipped 0.1% in August.

 

Economists have attributed the strength in retail sales to fiscal stimulus, especially a weekly subsidy paid to tens of millions of unemployed Americans. September’s robust sales reinforced expectations for record consumer spending and economic growth in the third quarter.

 

Growth estimates for the July-September quarter are as high as a 35.2% annualized rate. That would recoup roughly two-thirds of the output lost because of COVID-19. The economy contracted at a 31.4% pace in the second quarter, the deepest decline since the government started keeping records in 1947.

 

 

U.S. stocks bounced from three straight days of losses on the retail sales data and Pfizer’s announcement that it could apply for emergency use of its COVID-19 vaccine candidate as early as November.

 

BROAD SALES GAINS

Last month, sales at auto dealerships surged 3.6%. Receipts at restaurants and bars increased 2.1%. Receipts at clothing stores jumped 11.0%.

 

“Some of the gain may have reflected increased demand from back to school sales, but with most schools remote learning the reported strength seems dramatic and likely unsustainable,” said Kevin Cummins, chief U.S. economist at NatWest Markets in Stamford, Connecticut.

 

Even with September’s gains, sales at bars, restaurants and clothing stores remain well below their pre-pandemic levels.

 

Purchases at electronics and appliance stores fell 1.6%.

 

Online and mail-order retail sales rose 0.5%. Furniture store sales gained 0.5%. Sales at sporting goods, hobby, musical instrument and book stores rebounded 5.7%. These categories notched big year-on-year increases in September, which economists said showed the uneven impact of the recession.

 

“It’s further evidence of how many top earners have managed to dodge the pandemic by working from home, while most lower- paid workers have been forced to choose between jobs putting them at risk, when they can find them, and unemployment,” said Chris Low, chief economist at FHN Financial in New York.

 

The White House and Congress are struggling to reach a deal on another rescue package for businesses and the unemployed. The government reported on Thursday that new claims for unemployment benefits increased to a two-month high last week.

 

Last month’s jump in retail sales set consumer spending on a higher growth path heading into the fourth quarter, which will likely ensure that the economy continues to expand, though at a moderate pace. Growth estimates for the fourth quarter have been slashed to as low as a 3% rate from above a 10% pace.

 

Some economists believe that historic savings could cushion consumer spending in the absence of more financial aid from the government. Others, however, caution that rising COVID-19 infections and job losses could encourage some consumers to hunker down and conserve savings.

 

A survey from the University of Michigan on Friday showed consumer sentiment edging up in early October.

 

Consumers, however, worried about current economic conditions because of “slowing employment growth, the resurgence in COVID-19 infections and the absence of additional federal relief payments.”

 

They were less enthusiastic about buying household appliances. The share who believed it was a good time to buy a car was the lowest in nine years.

 

 

 

 

Twitter backtracks, allows users to post previously blocked NY Post article

PALO ALTO Calif/WASHINGTON (Reuters) - Twitter Inc TWTR.N on Friday confirmed it reversed its decision to block links to a New York Post article about Democratic presidential candidate Joe Biden's son, despite reaffirming the ban late on Thursday.

 

Republicans who had decried Twitter’s earlier actions posted the story freely on the site. “You can now share the bombshell story Big Tech didn’t want you to see,” Arizona Representative Paul Gosar tweeted on Friday morning.

 

Twitter acknowledged Friday it had stopped blocking links to early versions of the New York Post articles, saying the private information included in them had become widely available in the press and on other platforms.

 

The company’s policy chief Vijaya Gadde said Thursday night that Twitter had decided to make changes to its hacked materials policy following feedback, but a spokesman told Reuters that the New York Post story would still be blocked for “violating the rules on private personal information.”

 

“We will no longer remove hacked content unless it is directly shared by hackers or those acting in concert with them,” Gadde said in a series of tweets. “We will label Tweets to provide context instead of blocking links from being shared on Twitter.”

 

Twitter had initially said the Post story violated its “hacked materials” policy, which bars the distribution of content obtained through hacking, but has provided no details on what materials it viewed as hacked.

 

Twitter Chief Executive Jack Dorsey said in a tweet Friday morning that “straight blocking of URLs was wrong” and suggested that Twitter instead should have applied tools like labels.

 

“Our goal is to attempt to add context, and now we have capabilities to do that,” he tweeted.

 

Tweets of the story successfully published on Friday did not have any labels attached. Twitter declined to answer Reuters questions on whether that was due to an error or a policy decision.

 

The company had briefly restricted the Twitter account of U.S. President Donald Trump’s re-election campaign after it posted a video that referred to the New York Post story on Thursday.

 

U.S. Senate Judiciary Committee Chairman Lindsey Graham and Republican Senators Ted Cruz and Josh Hawley said on Thursday the committee would vote on Tuesday on sending a subpoena to Dorsey.

 

Separately, the Senate Commerce Committee confirmed Friday it will hold an Oct. 28 hearing with Dorsey and the chief executives of Facebook Inc FB.O and Google parent Alphabet Inc GOOGL.O and will look at "how best to preserve the internet as a forum for open discourse."

 

The companies previously confirmed the executives would remotely appear at the hearing.

 

 

 

Oil dips on COVID-19 resurgence, fears of more supply

NEW YORK (Reuters) - Oil prices edged lower on Friday, dragged down by concerns that a spike in COVID-19 cases in the United States and Europe will continue to drag on demand in two of the world’s biggest fuel-consuming regions.

 

OPEC+, a grouping of the Organization of the Petroleum Exporting Countries and allied producers including Russia, fear a prolonged second wave of the pandemic and a jump in Libyan output could push the oil market into surplus next year, according to a confidential document seen by Reuters, a much gloomier outlook than just a month ago.

 

Brent crude futures LCOc1 fell 23 cents to settle at $42.93 a barrel, and U.S. West Texas Intermediate (WTI) crude futures dropped 8 cents to settle at $40.88 a barrel.

 

Brent rose 0.2% for the week, while WTI was on track to gain 0.7%.

 

“The reality is that we’re now seeing a pretty active spread of the pandemic across Europe and it’s spreading again in North America, and that potentially will weigh on oil demand recovery,” said Lachlan Shaw, head of commodity research at the National Bank of Australia.

 

Some European countries were reviving curfews and lockdowns to fight a surge in new coronavirus cases, with Britain imposing tougher COVID-19 restrictions in London on Friday.

 

A panel of officials from OPEC+, called the Joint Technical Committee, discussed their worst-case scenario during a virtual monthly meeting on Thursday. That involved commercial inventories from major world consumers remaining higher than the five-year average in 2021, rather than falling below that mark.

 

The group’s Joint Ministerial Monitoring Committee (JMMC), will consider the outlook when it meets on Monday. The JMMC can make a policy recommendation.

 

“We expect on Monday’s meeting some strong words on compensating for (members’) undercompliance,” said Paola Rodriguez-Masiu, Rystad Energy’s senior oil markets analyst. “What everybody is wondering is if there will be any action against the laggards this time or if the bashing will stay at a verbal level.”

 

OPEC+ is set to ease its current supply cuts of 7.7 million barrels per day (bpd) by 2 million bpd in January.

 

In the United States, drillers have begun adding oil rigs since cutting them to a 15-year low in August. This week, they added the most oil rigs in a week since January, increasing the count by 12 to 205, energy services firm Baker Hughes Co BKR.N said. RIG-USA-BHI, RIG-OL-USA-BHI, RIG-GS-USA-BHI

 

Money managers cut their net long U.S. crude futures and options positions by 9,442 contracts to 288,454 in the week to Oct. 13, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

 

 

 

 

 

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2020

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


Bindura Nickel Corporation

 

 

 


Padenga Holdings

 

 

 


Delta Corporation

 

 

 


Meikles Limited

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 


DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of Faith Capital (Pvt) Ltd for general information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy or subscribe for any securities. The information contained in this report has been compiled from sources believed to be reliable, but no representation or warranty is made or guarantee given as to its accuracy or completeness. All opinions expressed and recommendations made are subject to change without notice. Securities or financial instruments mentioned herein may not be suitable for all investors. Securities of emerging and mid-size growth companies typically involve a higher degree of risk and more volatility than the securities of more established companies. Neither Faith Capital nor any other member of Bulls ‘n Bears nor any other person, accepts any liability whatsoever for any loss howsoever arising from any use of this report or its contents or otherwise arising in connection therewith. Recipients of this report shall be solely responsible for making their own independent investigation into the business, financial condition and future prospects of any companies referred to in this report. Other  Indices quoted herein are for guideline purposes only and sourced from third parties.

 


 

 


(c) 2020 Web: <http://www.bullszimbabwe.com>  www.bullszimbabwe.com Email:  <mailto:info at bulls.co.zw> info at bulls.co.zw Tel: +263 4 2927658 Cell: +263 77 344 1674

 


 

 

 

 

 

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