Major International Business Headlines Brief::: 22 October 2020

[Bulls n Bears]

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Major International Business Headlines Brief::: 22 October 2020

 


 

 


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

 


 

 


ü  Tesla sets revenue record, makes profit thanks to pollution credit sales
to rivals

ü  Wall Street banks see rare payday bonanza in India despite pandemic

ü  Asian shares drop as U.S. stimulus talks drag on

ü  Streaming service Quibi to wind down operations six months after launch

ü  Exxon Mobil 'very close' to disclosing U.S., Canada job cuts, says CEO

ü  U.S. economy's rebound sets up test of Fed's new pledge

ü  Amazon announces $100 million logistics investment in Mexico

ü  Analysis: China and U.S. economies diverge over coronavirus response

ü  Cruise, GM to seek U.S. okay for self-driving vehicle without pedal,
steering wheel

ü  Shortage of poultry workers could hit Christmas dinner

ü  UK inflation rises after Eat Out to Help Out ends

ü  Asia suffering "worst recession in living memory"

ü  Lesotho Transport Operators Begin 7-Day Strike Against Mobile Traffic
Court

ü  Mozambique: Mining Companies Suspended Because of Pollution

ü  Ugandan Court Suspends Judgement Outlawing Cross-Border Lending

ü  Uganda Fails to Attract New Bidders for Oil Blocks

ü  Uganda: Government Seeks Shs6 Trillion to Meet Budget Shortfall

ü  Namibia: Shiimi Frees Up N$840 Million... Current Budget Remains
Unchanged At N$72.8bn

 


 <mailto:info at bulls.co.zw> 

 


 

Tesla sets revenue record, makes profit thanks to pollution credit sales to
rivals

(Reuters) - Tesla Inc on Wednesday reported its fifth consecutive quarterly
profit on record revenue of $8.8 billion, boosted by an uptick in vehicle
deliveries and sales of environmental regulatory credits to other
automakers.

 

 

The electric car maker also affirmed its target to deliver half a million
vehicles by the end of this year, a goal that will require it to
significantly ramp up vehicle sales in the fourth quarter.

 

Shares were up 2.5% at $433.88 in extended trade as the carmaker beat
analysts’ estimates.

 

Tesla said it had the capacity installed to produce and deliver 500,000
vehicles this year, but added that achieving its goal has become more
difficult.

 

“Achieving this target depends primarily on quarter over quarter increases
in Model Y and Shanghai production,” the company said.

 

Asked by an analyst during a conference call whether Tesla aimed to deliver
840,000 to 1 million vehicles next year, based on its factories’ current
maximum capacity, Chief Executive Officer Elon Musk responded the target was
“in that vicinity,” while another Tesla executive said the company would
provide guidance next quarter.

 

Tesla has defied a downward trend in the wider auto industry in 2020 and
bucked a pandemic and economic upheaval with steady sales and profitable
quarters, sending shares up around 400% this year.

 

At $394.5 billion, Tesla’s market capitalization has become the largest
among all global automakers, despite the company trailing rivals in sales,
revenue and profit.

 

Tesla’s ascent highlights investor confidence in the future of electric
vehicles and the company’s shift from niche carmaker to global leader in
clean cars.

 

But Craig Irwin, an analyst with Roth Capital Partners, cautioned that
Tesla’s lead could soon narrow.

 

“The company is still valued incredibly richly, like it’s operating in a
vacuum, yet competitors are working furiously to catch up,” he said,
referring to more than 400 new electric vehicle models scheduled to hit the
roads by 2024.

 

General Motors Co on Wednesday revealed an electric version of its Hummer
pickup truck that will compete with Tesla’s futuristic Cybertruck, which is
scheduled to go into production next year.

 

Musk on Wednesday said Cybertruck orders will be delivered in 2022, or
toward the end of 2021 the earliest.

 

Tesla in September outlined plans to cut battery production costs by
producing larger cells in-house to power a growing fleet, including heavier,
more energy-intense vehicles.

 

But Musk on Wednesday said the company would not depend on internal cell
production before 2022, suggesting that Tesla will continue to rely on its
external battery suppliers Panasonic Corp, LG Chem and CATL.

 

He also said Tesla would roll out what it calls “Full Self Driving” more
widely by the end of this year. Tesla on Wednesday launched the feature for
an undisclosed number of “expert, careful” drivers in a pilot launch.

 

Musk has been promising fully autonomous features for several years and
Tesla buyers can pay $8,000 in hopes of eventually receiving the upgrade.

 

Safety groups have criticized the term “Full Self Driving” as dangerously
misleading, with the system expected to be capable of functioning only in
limited-use cases.

 

Revenue rose to a record $8.77 billion from $6.30 billion a year earlier.
Analysts had expected revenue of $8.36 billion, according to IBES data from
Refinitiv.

 

Excluding items, Tesla posted a profit of 76 cents per share. It reported
net income of $331 million, or $874 million excluding stock-based
compensation awards given to Musk.

 

Revenue from the sale of regulatory credits made up $397 million. Without
that revenue, Tesla would not have achieved a profitable quarter.

 

So far this year, regulatory credits account for $1.18 billion, or 7% of
total automotive revenue.

 

Pollution credits became a more meaningful source of revenue for Tesla about
a year ago when California and other U.S. states increased the mandatory
share of zero-emission vehicles sold per manufacturer. As competitors begin
selling more electric vehicles, that revenue is expected to dry up.

 

With recovery in the United States sluggish and Europe struggling with a
second bout of the virus outbreak, some analysts have pinned their hopes for
Tesla on growth on China, which has begun to recover as consumers shake off
the pandemic’s effects.

 

Tesla does not break out regional sales, but data from China’s auto industry
association, CPCA, showed Tesla Model 3 sedan sales remained roughly flat
from July to September. Overall, Tesla sold around 34,100 Shanghai-made
Model 3s in the third quarter.

 

Tesla on Wednesday said Model 3 production at its Shanghai plant has
increased to 250,000 vehicles a year, its targeted production rate.

 

Its main factory in Fremont, California, has a capacity of 590,000 vehicles,
including the Model Y.

 

The carmaker said it would focus on improving manufacturing cost and
efficiency and increase capacity as quickly as possible.

 

Tesla is building additional vehicle and battery plants in Berlin, Germany,
and Austin, Texas, to ramp up production of existing vehicles and launch new
models, including its Cybertruck and Semi truck.

 

Production at the German factory is expected to start in 2021.

 

 

 

Wall Street banks see rare payday bonanza in India despite pandemic

HONG KONG (Reuters) - Major Wall Street banks in India raked in their
second-highest fee income since the global financial crisis in the first
nine months of this year, benefitting from a flurry of private-sector deals
despite the coronavirus pandemic.

 

 

India has seen a number of multi-billion dollar transactions in 2020 from
oil-to-telecom conglomerate Reliance Industries' fundraising efforts RELI.NS
to GlaxoSmithKline's GSK.L sale of its stake in Unilever's ULVR.L Indian
business HLL.NS, the country's largest block trade.

 

Five U.S. banks including Morgan Stanley MS.N and Goldman Sachs GS.N earned
$170 million in investment banking fees in January-September, the highest
for that period since 2018, according to Refinitiv data, putting them on
course for one of their most profitable years.

 

In 2018, those five banks earned $176.5 million in Indian fees in the first
nine months of the year, which was the highest for the period since 2007.

 

It comes as India’s economy shrank by nearly a quarter in April-June as the
country became one of the worst hit by the coronavirus pandemic.

 

“This year we are seeing a tremendous interest from international investors
across sectors in India – in tech, real estate, financial and consumer
sectors,” said Dieter Turowski, Asia Pacific investment banking chairman at
Morgan Stanley.

 

“In aggregate, the quantum of capital raising will continue but it’ll be
more diversified next year. The pipeline is stronger than six months ago.”

 

India saw $16.8 billion of mergers and acquisitions (M&A) in its technology,
media, and telecoms (TMT) sector between January and mid-October, up 62%
percent from the same time last year, according to Refinitiv data.

 

The momentum is expected to continue in 2021 when a series of technology
companies such as e-commerce firm Flipkart are expected to list domestically
or overseas.

 

Raj Balakrishnan, Bank of America’s head of India investment banking, said
consumer-tech would be a big deal driver for the country in the near future
with more consolidation and initial public offerings (IPOs) to come.

 

U.S. and European banks received 41.9% of the total investment banking fees
earned in India in the first nine months of 2020, up from 37.2% last year,
in a highly competitive market with a large number of local rivals.

 

Some European banks’ retreat from the country in recent years has helped
Wall Street banks increase the share of fees they earn, bankers said.

 

Morgan Stanley took home a record $65 million in the first nine months of
this year, topping India’s M&A league table, thanks to its role as Reliance
Industries’ financial advisor in the fundraising for its digital and retail
units.

 

Reliance raised over $20 billion from investors including Facebook FB.O,
Alphabet's GOOGL.O Google, KKR KKR.N and Silver Lake Partners this year,
contributing to India' sharp growth in M&A activity in 2020.

 

Separately, Goldman had earned nearly $30 million in fees this year as of
end-September, its highest since 2018, as it got the advisory role on a $7
billion rights issue for Reliance Industries, the largest ever such deal in
India.

 

The lofty returns will be welcomed by foreign investment banks which have
long complained in private about the miserly fees they earn on Indian
transactions, mainly on state deals.

 

Goldman Sachs said India was an important and growing market for the bank.

 

“Continued deal flow will come from financial sponsors, conglomerates
strategically redefining and optimising their portfolios, and consolidation
in tech and consumer sectors,” said Sonjoy Chatterjee, the bank’s head of
India.

 

 

 

Asian shares drop as U.S. stimulus talks drag on

SHANGHAI/NEW YORK (Reuters) - Asian shares fell on Thursday and U.S.
Treasury yields ticked lower as investors fretted over the slow pace of U.S.
stimulus talks and a surge in global cases of COVID-19.

 

 

Global investor sentiment took a fresh hit over talks to boost the world’s
largest economy after U.S. President Donald Trump on Wednesday accused
Democrats of being unwilling to craft an acceptable compromise on stimulus,
following reports of progress earlier in the day.

 

It remains unclear whether stimulus negotiations would continue ahead of the
U.S. presidential and congressional elections on Nov. 3.

 

“We still think that this deal will remain elusive in the sense that this
amount that we are talking about, $1.88 trillion, that’s about 9% of GDP,
and 2.2 trillion which is Speaker Pelosi’s package, is even higher at around
10% of GDP,” said Anthony Chan, chief Asia investment strategist at Union
Bancaire Privee (UBP) in Hong Kong.

 

“Even if both sides do manage to reach an agreement, given the tight
deadline ahead of the election it’s unlikely that something like that would
be able to go through the Senate smoothly.”

 

In morning trade, MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS was down 0.63%.

 

Australian shares .AXJO gave up 0.6%, Seoul's Kospi .KS11 was off 0.59% and
and Chinese blue-chips .CSI300 dropped 1.1%.

 

The Nikkei .N225 was 0.69% lower.

 

Uncertainty over the passage of a bill to stimulate a pandemic-ravaged
economy comes as the United States faces a new wave of COVID-19 cases.

 

Nearly two-thirds of U.S. states were in a danger zone of coronavirus spread
and six, including election battleground Wisconsin, reported a record
one-day increase in COVID-19 deaths on Wednesday.

 

Against the backdrop of stimulus talks and the spread of the novel
coronavirus, Wall Street’s three major averages closed lower on Wednesday
after a choppy trading session.

 

The Dow Jones Industrial Average .DJI inched lower by 0.35%, while the S&P
500 .SPX lost 0.22%. The tech-heavy Nasdaq Composite .IXIC dropped 0.28%.

 

On Thursday, the dollar was 0.11% higher against the yen at 104.67 JPY=,
while the euro EUR= notched down 0.19% to $1.1839.

 

But against a basket of major peers, the dollar =USD appeared relatively
unaffected by setbacks to stimulus talks, trading only slightler higher at
92.784.

 

“Markets are now pricing in a strong likelihood of a Biden Presidency
perhaps even clean sweep of Congress, and this is weighing on the USD, as
they view a less confrontational trade environment. They will also probably
be factoring in a large fiscal stimulus early next year, with none of the
hold up that is currently preventing a deal,” Rob Carnell, chief economist
at ING in Singapore said in a note.

 

The yield on benchmark U.S. 10-year Treasury notes US10YT=RR ticked down to
0.8108% from a U.S. close of 0.816% on Wednesday.

 

In commodity markets, oil prices dropped, adding to sharp losses overnight,
after higher U.S. gasoline inventories pointed to a deteriorating outlook
for fuel demand as coronavirus cases soar.[EIA/S]

 

U.S. West Texas Intermediate (WTI) crude CLc1 futures fell 0.6% to $39.79 a
barrel and Brent crude LCOc1 futures wer 0.48% lower at $41.358 a barrel.

 

 

 

Streaming service Quibi to wind down operations six months after launch

(Reuters) - Streaming service Quibi said on Wednesday it intends to wind
down its operations and start a process to sell its assets, just six months
after its launch.

 

The announcement highlights the dominance that Netflix, Amazon’s Prime
Video, Disney+ and Apple TV+ hold over smaller streaming service providers,
which struggle to keep up against their large content budgets and vast
libraries of shows.

 

“The world has changed dramatically since Quibi launched and our standalone
business model is no longer viable,” founder Jeffrey Katzenberg said in a
statement.

 

Los Angeles-based Quibi offers entertainment and news in episodes of 10
minutes or less on mobile phones, initially promoted for on-the-go viewing.
The service was priced at $5 a month with advertisements, or $8 a month
without them.

 

“Our failure was not for lack of trying; we’ve considered and exhausted
every option available to us,” Chief Executive Meg Whitman and Katzenberg
said in a letter to employees. They said the failure could be either because
the idea itself wasn’t strong enough to justify a standalone streaming
service or because of its timing.

 

Quibi, which is backed by $1.8 billion from Hollywood studios and other
investors, was launched on April 6 when audiences were sheltering at home to
help prevent the spread of the coronavirus.

 

Popular shows on the service included “Most Dangerous Game” starring Liam
Hemsworth and Christoph Waltz and “Chrissy’s Court” and news and talk shows
like “Around the World by BBC News” and “The Report by NBC News”.

 

Besides ad sales, Quibi has generated $3.3 million in subscription revenue
since its launch, with revenue trending downward since July, according to
analytics firm Apptopia.

 

 

 

Exxon Mobil 'very close' to disclosing U.S., Canada job cuts, says CEO

HOUSTON (Reuters) - Exxon Mobil Corp XOM.N is "very close" to completing its
workforce appraisals in the United States and Canada and expects to unveil
job cuts, its chief executive told employees in an email on Wednesday.

 

The second-largest U.S. oil company by market value lost nearly $1.7 billion
in the first six months and analysts forecast a third-quarter $1.17 billion
loss, according to IBES data from Refinitiv.

 

The job cuts are part of a plan unveiled this spring to redesign how Exxon
works and to increase competitiveness, CEO Darren Woods said in an email to
its nearly 75,000-person workforce.

 

Exxon has exceeded a target of reducing operating expenses by $1 billion and
capital budget spending by $10 billion, he wrote. But the COVID-19 pandemic
has cut oil demand by about 20%, he said, delivering a “devastating impact”
on the oil business.

 

Woods told employees that “we are very close” to completing the jobs review
and that they could expect details soon after the company’s board of
directors is briefed.

 

“I wish I could say we were finished, but we are not. We still have some
significant headwinds, more work to do and, unfortunately, further
reductions are necessary,” he said in the email.

 

Exxon was slower than rivals to react to this year’s oil price decline and
borrowed $23 billion to shore up a balance sheet strained by the losses and
a nearly $15 billion annual dividend payment to shareholders.

 

Royal Dutch Shell and BP have outlined up to 15% workforce cuts while
Chevron has asked employees to reapply for their jobs.

 

Woods said the demand loss is five times the decline of the 2008 financial
crisis, but “industry under-investment today will increase the need for our
products in the near future.”

 

All oil companies face the same loss of demand, but Exxon has the burden of
promising to keep its huge dividend without adding new debt, said Raymond
James analyst Pavel Molchanov. U.S. oil prices must rise another $10 a
barrel to cover the payout without borrowing, he estimates.

 

“If management has to walk back their pledge” not to issue new debt to
protect the dividend, “it would damage credibility,” Molchanov said.

 

Exxon’s dividend yield, the percent of the share price paid annually to
holders, was 10.3%, the largest among major oil companies and another sign
of Exxon’s weak finances.

 

Its shares fell 1.6% to $33.14 on Wednesday as oil prices declined on
worries that the COVID-19 infections are on the rise globally. The stock is
trading near a 18-year low.

 

 

 

U.S. economy's rebound sets up test of Fed's new pledge

(Reuters) - The stronger-than-expected U.S. economic rebound from
coronavirus lows could set up an early test for the Federal Reserve’s new
pledge to keep interest rates near zero and its increased tolerance for
inflation.

 

A compilation of surveys and interviews conducted in September and early
October by the Fed’s 12 regional banks shows the economy recovering at a
“slight to modest pace” as consumers bought homes and increased spending.

 

Indeed the U.S. economy probably grew by more than 30% on an annualized
basis last quarter, economists say, making up most of the 31.4% drop in the
second quarter.

 

The increase has been fueled by a $2.3 trillion pandemic relief package and
trillions more injected into financial markets by the Fed.

 

“Traditional ideas about inflation would suggest that this is actually a
time when you may see some inflation,” St. Louis Fed President James Bullard
said at an event hosted by the Federal Home Loan Bank of Des Moines. He said
increased government spending to combat the virus and “bottlenecks” in an
economy not designed to grow as fast as it is are setting the stage for a
rise in prices.

 

“On top of that you’ve got a Federal Reserve that’s saying, if we do get
inflation, we’d welcome it,” he said.

 

With businesses adapting to the virus and daily deaths much lower than in
the pandemic’s early stages, he said, U.S. economic growth will likely be
above trend for quite a while, “so this might be an era where you might see
somewhat more inflation.”

 

The Fed last month pledged not to raise interest rates until the economy
returns to full employment and inflation reaches the Fed’s 2% goal.

 

But policymakers’ tolerance above that 2% mark varies. Chicago Fed President
Charles Evans said this week he’d be okay with a year of 2.5% to 2.75%
inflation, while Dallas Fed President Robert Kaplan has signaled anything
more than 2.25% could raise concern.

 

Inflation is currently trending below 2% but with the recent surge in
growth, that soon could change.

 

Speaking earlier in the day, Fed Governor Lael Brainard said that while
overall inflation will stay low for the next few years, Americans could see
a temporary inflation spike next spring as price data registers year-on-year
gains from the coronavirus trough.

 

But, she said, the Fed would not react by raising rates with the central
bank committed to providing “sustained accommodation” to the economy for as
long as needed.

 

Overall, the Fed’s beige book pointed to the kind of uneven recovery that
officials warn may become a more-or-less permanent state of affairs unless
there is more federal relief.

 

Brainard said failure to deliver more fiscal aid is the biggest risk to her
outlook.

 

Bullard - who often holds views outside the mainstream at the Fed - had a
different take, saying Wednesday pandemic relief passed in March will be
enough to get the economy through the end of the year and into the first
quarter of 2021.

 

By then, he said, the economy may be set up for a boom once a vaccine or
better therapeutics become widely available.

 

 

 

Amazon announces $100 million logistics investment in Mexico

MEXICO CITY (Reuters) - Amazon.com Inc said on Thursday it has invested $100
million in opening new warehouses in Mexico, including its first shipping
centers outside the populous capital area, in a bid to offer faster
deliveries.

 

The new sites include two so-called fulfillment centers - one near the
northern city of Monterrey and another near the central city of Guadalajara
- as well as a support building in the State of Mexico, just outside Mexico
City.

 

Amazon also opened 12 delivery stations, bringing its total to 27 across the
country, it said.

 

“The construction of a solid infrastructure network allows the company to
stay closer than ever to clients, and thanks to that, it’s possible to offer
fast deliveries,” Amazon said in a statement.

 

Monterrey and Guadalajara are the two biggest metropolitan zones of the
country after the sprawling Mexico City area.

 

The new facilities represent 69,000 square meters (742,710 sq ft) altogether
and create 1,500 direct and indirect jobs, Amazon said.

 

Amazon in total now runs five fulfillment centers, two support buildings and
two classification centers in Mexico, where it launched its marketplace in
2015.

 

Enrique Alfaro, the governor of Jalisco state that is home to Guadalajara,
said the new local warehouse would help more small and medium sized
businesses ship their products faster and at lower costs.

 

Amazon is also striving to make inroads in Brazil, where it recently opened
its fifth and biggest fulfillment center in the country, with 100,000 square
meters (1,076,391 sq ft).

 

In both countries, which are the biggest economies in Latin America, Amazon
is vying with local rivals for shopper loyalty, despite its ranking as the
world’s biggest online retailer.

 

 

 

Analysis: China and U.S. economies diverge over coronavirus response

WASHINGTON (Reuters) - The United States and China dealt with the spread of
the devastating coronavirus pandemic in vastly different ways, and that
split is reshaping the global battle between the world’s two leading
economies.

 

About 11 months after the Wuhan outbreak, China’s official GDP numbers this
week show not only that the economy is growing, up 4.9% for the third
quarter from a year earlier, but also that the Chinese are confident enough
the virus has been vanquished to go shopping, dine and spend with gusto.

 

China’s total reported death toll is below 5,000 and new infections are
negligible, the result of draconian lockdowns, millions of tests, and strict
contact tracing that set the stage for an economic rebound.

 

“China’s success in containing the virus has allowed its economy to rebound
more quickly, and with relatively less policy support, as compared with
other large economies,” said former senior U.S. Treasury official Stephanie
Segal, a senior fellow at the U.S.-based Center for Strategic and
International Studies.

 

In the United States, 221,000 people are dead from COVID-19 after a delayed
federal response, partisan battles over mask-wearing and lockdowns, and
plenty of public events that do not follow public health guidelines. The
country is in the midst of a new wave of infections.

 

Entertainment venues, restaurants and tourist spots are closed or only
partially open, millions of people are out of work indefinitely, GDP is
expected to shrink this quarter and the United States faces a gap in
economic output that could last years.

 

“Obviously the U.S. government bungled it,” said Harry Broadman, a former
senior U.S. trade official and managing director with Berkeley Research
Group. The singular authority of China’s Communist Party helped Beijing
enforce contact tracing and lockdowns, Broadman said. Other democracies,
including New Zealand and South Korea, stamped out the virus as China did.

 

The real difference between the United States and China is Washington “has
been arguing over stimulus issues on Capitol Hill and it’s still far too
little and too late,” said Broadman, who has served under both Republican
and Democratic presidents. “That has created more and more uncertainty on
the part of business.”

 

Ahead of a Nov. 3 re-election bid, U.S. President Donald Trump has blamed
China for the spread of the virus and asserted his administration had done
all it could to contain it. Asked during a town hall due to be broadcast on
Sinclair Broadcast Group on Wednesday if he would have done anything
differently, Trump said, “No, not much.”

 

 

White House spokesman Brian Morgenstern said on Wednesday that China does
not accurately report anything, “let alone data regarding coronavirus
infections and economic growth.” He said Trump was rebuilding a strong and
inclusive economy with the expected arrival of new treatments and vaccines
in what the spokesman called record time.

 

The U.S. Federal Reserve on Wednesday released data that showed a slight to
modest recovery in the U.S. economy, although the picture varied greatly
from sector to sector.

 

RIPPLE EFFECTS

Experts cite longer-term concerns about China’s economic prospects,
including the high debt levels of its state-owned companies.

 

“Reliance on investment-led growth, fueled by credit expansion, builds up
even further leverage and risks in an already weak financial system, and
will further pull down efficiency and the sustainable growth rate,” said
Mark Sobel, a former senior U.S. Treasury official.

 

But for now, the divergent responses to the virus will have an impact on the
fierce political and economic rivalry between Beijing and Washington with
ripples felt around the world, experts said.

 

“China’s economy in 2021 is going to be 10% bigger than it was in 2019, and
every other major economy is going to be smaller,” said Nicholas Lardy, an
economist with the Peterson Institute for International Economics.

 

That means China’s “role in the global economy is going to continue to
expand,” Lardy predicts, making any attempts by U.S. policymakers to
discourage other countries from deals with Beijing, or otherwise “decouple”
China from the global economy, more difficult.

 

China’s exports have been stronger than expected, bolstered by demand for
medical goods overseas. While the IMF projects global trade volume will fall
by 10.4% in 2020, China’s overall share of global trade has grown.

 

Beijing is experiencing other benefits as well. “We see signs of China’s
success in the exchange rate and equity market performance at a time when
many other economies are under pressure,” Segal said.

 

China’s fiscal deficit for 2020 will expand by 5.6 percentage points to
11.9% of GDP - a smaller-scale increase than the massive stimulus that
Beijing deployed during the 2008-2009 financial crisis, the IMF’s Fiscal
Monitor shows.

 

By contrast, the United States will see a 12-percentage point increase in
its 2020 fiscal deficit as a share of GDP, to nearly 19%.

 

While China’s consumption is improving, retail sales are still down 7.2%
over the first three quarters, with urban residents’ disposable incomes down
0.3% over the same period. Strict lockdowns earlier in the year led to
months of lost wages for many workers.

 

Interactive Graphic: The missing trillions tmsnrt.rs/2SVkVpI

 

In Beijing, officials are highlighting their leadership role.

 

“China’s epidemic control and prevention is at the forefront of the world,
and China’s companies are supporting the global resumption of work and
production through their own resumptions,” said Liu Aihua, spokeswoman for
the National Bureau of Statistics, at a news conference where she announced
the third quarter GDP results.

 

Meanwhile, the United States still lacks a robust contact tracing system, or
enough testing, Lardy said. These are things the U.S. could have “done much
better at without being an authoritarian single party state,” he added.

 

 

 

 

Cruise, GM to seek U.S. okay for self-driving vehicle without pedal,
steering wheel

(Reuters) - Self-driving car maker Cruise said on Wednesday it and majority
shareholder General Motors Co would seek U.S. regulatory approval in coming
months to deploy a limited number of Cruise Origin vehicles without steering
wheels or pedals.

 

At the same time, it will withdraw an exemption petition filed with the
National Highway Traffic Safety Administration (NHTSA) in January 2018
seeking approval to deploy a limited number of similar autonomous vehicles
based on the Chevrolet Bolt platform.

 

NHTSA, which spent 15 months reviewing the GM petition before seeking public
comment, said Wednesday it “will review the new petition when it is
received.”

 

Cruise unveiled the Origin, which only has two long seats facing each other
that can comfortably fit four passengers, in January. GM plans to begin
building the Origin in Detroit in late 2021 or early 2022.

 

Robert Grant, Cruise’s vice president of global government affairs, made the
announcement after Cruise received a permit from California’s Department of
Motor Vehicles last week to be the first to test cars without any riders on
San Francisco streets. Four other companies have permits to drive empty in
Silicon Valley cities that are easier to navigate.

 

Under current law, companies can seek an exemption from motor vehicle safety
standards for up to 2,500 vehicles for up to two years that do not meet
existing federal rules.

 

The exemptions are for U.S. vehicle safety rules largely written decades ago
that assumed human drivers would be in control of a vehicle.

 

GM sought in 2018 a temporary waiver on features like mirrors, dashboard
warning lights and turn signals designed for a human driver. GM initially
hoped to win approval to deploy the vehicles without human controls by the
end of 2019.

 

NHTSA has been considering revising auto safety rules to remove “unnecessary
regulatory barriers to the safe introduction of automated driving systems.”

 

 

 

 

Shortage of poultry workers could hit Christmas dinner

Christmas dinner could be ruined this year as supplies of traditional
turkeys could run out, an industry body says.

 

The problem is a shortage of skilled workers to process the meat, according
to the British Poultry Council (BPC).

 

It said 1,000 EU workers were needed to stop Christmas supply from
collapsing, and urged the government to exempt them from quarantine rules.

 

"The great British Christmas cannot survive without access to non-UK
labour," said boss Richard Griffiths.

 

He said there is a dearth of UK workers with the right training and
qualifications to slaughter and process the nine million turkeys reared for
Christmas.

 

"Turkey producers are heavily reliant on licensed and trained EU workers
with specific farming, processing, and butchery skills.

 

"These skills cannot be replaced without a lengthy training and recruitment
period."

 

Workers needed

The seasonal turkey industry reckons it needs to bring in at least 1,000
skilled workers for the 2020 Christmas period.

 

But workers won't come to Britain if they are forced to quarantine for 14
days before starting work, it said.

 

The type of skills turkey production requires are not available among UK
workers, according to the Council.

 

Will Christmas celebrations be the same this year?

Workers need to have been trained specifically in Watok - Welfare of Animals
at Time of Killing - and licensed to kill or slaughter animals, which means
holding a certificate of competence from the Food Standards Agency.

 

"It will be unfeasible to train and up-skill UK workers within the short
window available," Mr Griffiths said.

 

The poultry industry estimates it takes someone at least 12 weeks to attain
basic slaughter and knife skills.

 

Mr Griffiths warned that if the seasonal vacancies are not filled it will
have a significant impact on the production and cost of food.

 

"That will pose a risk to affordability and potentially force people to go
without food this Christmas," he said.

 

'Steady supply'

The British Poultry Council has asked the government for an urgent exemption
for non-UK poultry workers from quarantine restrictions.

 

The proposed exemption would cover seasonal workers coming from Poland,
Romania, Hungary, Bulgaria, the Czech Republic, Slovakia and Slovenia at the
end of October 2020.A government spokesperson said:

 

A government spokeswoman said: "We recognise and appreciate our dedicated
farmers who continue to work tirelessly during this challenging time to keep
our nation fed.

 

"We are working with industry to assess needs and ensure a steady supply of
British turkeys as we approach Christmas."--BBC

 

 

 

 

UK inflation rises after Eat Out to Help Out ends

The end of cheaper restaurant meals pushed UK prices up last month after the
Eat Out to Help Out scheme expired.

 

The UK's inflation rate, which tracks the prices of goods and services,
climbed to 0.5% in September, from 0.2% in August.

 

The Consumer Prices Index (CPI) began rising more quickly in September after
the discount meals scheme ended, pushing up restaurant and café prices,

 

Transport costs also went up as demand for second-hand cars increased.

 

In catering services, prices rose 4.1% between August and September 2020,
compared with a rise of 0.2% between the same two months in 2019.

 

Transport costs rose for the first time since March, partly because the
price of second-hand cars was boosted by increased demand as people,
reportedly, looked to reduce their reliance on public transport, said the
Office for National Statistics (ONS).

 

CPI inflation

The price of second-hand cars, climbed 2.1% between August and September
2020, compared with a 1.4% fall between the same two months a year ago.

 

Average petrol prices also rose to 113.3p per litre in September 2020, up
from 113.1 pence in August. However, that was still some way below the
127.3p recorded in September 2019.

 

The drop in the cost of air fares usually seen in the September inflation
index had much less effect this year, according to Jonathan Athow, deputy
national statistician for economic statistics at the ONS.

 

"Air fares would normally fall substantially at this time due to the end of
the school holidays, but with prices subdued this year, as fewer people have
been travelling abroad, the price drop has been less significant," he said.

 

UK job losses 'could be larger than forecast'

UK facing 'unprecedented economic uncertainty'

Paul Dales, chief UK economist at Capital Economics, said that in the light
of continued low inflation, the Bank of England was likely to increase its
monetary stimulus measures next month to boost the ailing economy.

 

"With CPI inflation just 0.5% in September, it's hard to think of reasons
why the Bank of England won't launch another £100bn or so of QE at the
November meeting. And despite public borrowing still jumping, the government
may yet spend more," he said.

 

What is inflation?

Inflation is the rate at which the prices for goods and services increase.

 

It affects everything from mortgages to the cost of our shopping and the
price of train tickets.

 

It's one of the key measures of financial well-being, because it affects
what consumers can buy for their money. If there is inflation, money doesn't
go as far.

 

September's CPI is used in the calculation for state pensions, but the
government's triple-lock rule means the increase will be 2.5%, as it's the
highest figure out of CPI, earnings growth for the year to July (which was
actually negative), or 2.5%.

 

State benefits are also decided by the September inflation figure, meaning
payments will rise 0.5% next April, which is far less than this year's 1.7%
increase.

 

The September figure is also used to decide the annual increase in business
rates.

 

"Today's headline rate of inflation of 0.5% signals that gross business
rates bills next year for 2021-22 will increase by £159.42m in England,"
said real estate adviser Altus Group.

 

Business rates are devolved to Scotland, Wales and Northern Ireland.

 

The UK state pension is expected to rise by 2.5% in April, owing to
calculations guiding the government's triple-lock promise.

 

With average earnings lower than a year earlier (based on official figures
for May to July), and now the inflation rate only having risen slightly, the
backstop of a 2.5% increase kicks in.

 

This follows three years of higher rises and is well down on the 3.9%
increase seen in April this year.

 

Although it is still to be officially confirmed, it should mean:

 

The new flat-rate state pension (for those who reached state pension age
after April 2016) should go up by £4.40 a week from £175.20 a week at
present to £179.60 a week in April

The old basic state pension (for those who reached state pension age before
April 2016) should go up by £3.35 a week from £134.25 a week now to £137.60
a week in April

The expected increase could reignite debate over fairness between the
generations. On one hand, the rise will seem high to those who have lost
jobs during the pandemic, but the UK state pension remains one of the least
generous in western economies.

 

The age at which people now start to receive the UK state pension recently
hit 66 for men and women.--BBC

 

 

 

Asia suffering "worst recession in living memory"

Asia Pacific is set to recover from its worst recession in living memory,
the International Monetary Fund (IMF) says.

 

Growth forecasts for the region have been downgraded again, this time from
-1.6% to -2.2% for this year.

 

However, the glimmer of hope is for a bounceback of almost 7% next year,
according to the IMF.

 

China will play a big part in the region's growth next year, with its latest
data showing continued recovery from the downturn caused by the virus.

 

But there are still many black clouds on the horizon as countries, including
India, the Philippines and Malaysia, continue to battle with Covid-19
infections.

 

"The scars will be deep," said the IMF, pointing to lower investment which
will have a knock-on effect by the middle of the decade.

 

US-China tensions

Not only are economies in the region dealing with the fallout from the
pandemic, but they are also affected by the US-China trade war, and the
growing hostilities between the two economic superpowers.

 

Speaking to BBC's Asia Business Report on Thursday, Jonathan Ostry, the
IMF's acting director for Asia and Pacific, said: "This is something, for a
very export-orientated region, that is going to be a big risk going forward.

 

"We worry about decoupling of major technology hubs - not just in China and
the US but more broadly, which would have the affect of diminishing hi-tech
trade leading to inefficient production."

 

Earlier this week, China released its data for the July to September quarter
which showed economic growth of 4.9% compared to the same quarter last year.

 

China is seen as "a rare positive figure in a sea of negatives" by the IMF.

 

Drawn-out recovery

The good news is that the IMF expects the region to grow by 6.9% in 2021 but
this relies on many factors, including the containment of the virus.

 

"With the right policies and international support when needed, Asia's
engines can work together again and power the region ahead," Mr Ostry said.

 

One of the challenges will be diversifying Asia's economies away from an
over-reliance on exports, which the IMF calls "a work in progress".--BBC

 

 

 

Lesotho Transport Operators Begin 7-Day Strike Against Mobile Traffic Court

Lesotho transport operators have begun a seven-day countrywide strike in
protest against a new mobile traffic court, saying its hefty fines were
killing their struggling business amid Covid-induced woes.

 

Bus and taxi operators are also protesting that the mobile court subjected
people to unfair trials as it did not give them sufficient time to prepare
their cases and seek legal representation.

 

Launched in June this year, the mobile traffic court is a fully equipped
vehicle operating as a magistrate court but trialling only cases of traffic
offences on the spot.

 

On Wednesday morning, public transport users were forced to walk to their
workplaces while many had to return home because they could not get buses
and taxies to ferry them to work and other destinations.

 

 

Known for morning-hour traffic jams caused mainly by the influx of
second-hand imported cars from Japan, in the capital Maseru traffic was
smooth. Mainly private cars and very few taxis were seen on the roads
leading into the city.

 

The strike continues despite the government's indefinite suspension on
Tuesday of the mobile court to avert the imminent strike. For the operators,
the suspension is not enough - they want its complete removal from the
country's roads.

 

Transport operators said the police no longer issued spot-fines but all
minor offences are brought to court, typically ending in higher fines
(ranging from $6.06 to $90.9) as opposed to a spot-fine (usually $1.81).

 

Transport operators had petitioned Prime Minister Moeketsi Majoroto address
their grievances by 19 October but the Maseru Region Transport Operators
Chairperson, Mokete Jonas said Majoro missed their deadline without giving
an explanation.

 

 

Instead, the Minister of Transport, Tšoeu Mokeretla, announced on local
radio that the mobile court was suspended indefinitely to allow for
negotiations. To their dismay, Jonas said the government has not initiated
any communication with them.

 

The mobile court has not only affected the transport industry, as most of
the vehicles are parked at home in towns where it is deployed, but the brunt
is also felt by small businesses that rely on the taxi industry.

 

According to Road Fund, the court also aims to ensure effective collection
fines on traffic offences, "which Road Fund identified as a need".

 

This has led to a modified practice by the police on roadblock campaigns
done collaboratively with the mobile court.

 

"The government has turned against our industry. If it's not saddling it
with taxes, its fines don't even consider the Covid-19 challenges," Jonas
told a media briefing on Monday.

 

Speaking to RFI, the magistrate court information officer said the payments
end up being higher because of multiple charges that result in multiple
fines on one person.

 

The transport operators in August sued the government in a bid to stop
mobile court, but two months on, the case is still pending in court. In
their application, the taxi operators argued that the mobile traffic court
is "a mockery of justice... applying the law of the jungle".-RFI website.

 

 

 

 

Mozambique: Mining Companies Suspended Because of Pollution

Maputo — The authorities in the central Mozambican province of Manica have
suspended the operations of two gold mining companies, accused of polluting
the river Revue, according to a report by the Portuguese news agency Lusa.

 

The companies Clean Tech Mining and Gem Resources had been caught dumping
effluent from their mines into the river, thus making it impossible for
farmers to use the river water for irrigation or for their livestock.

 

"The areas where they were working have enough space for opening tailing
ponds and re-using the water", said mining inspector Octavio Semba. But
instead they deliberately dumped the effluent into the river.

 

Semba said the companies did this in the middle of the night, when nobody
was watching. The practice "is damaging to the environment", he said, and
the authorities do not know how long the companies have been behaving in
this way. Semba warned that they could be stripped of their mining licences.

 

This brings to six the number of mining companies whose activities in Manica
have been suspended. Two were suspended in 2017 and another two in 2018. Ten
companies are continuing to operate in the same area, while another five
suspended their operations because of the Covid-19 pandemic.

 

After activities by the environmental police units, the Manica provincial
government, in May 2016, announced that four of six rivers in the province
polluted by illegal mining (particularly by the use of mercury) had been
cleaned up, and it was determined that they should stay clean.

 

"We cannot allow practices damaging to the environment, to pollute once
again rivers that had been recovered by the environmental police", declared
Semba.

 

 

 

Ugandan Court Suspends Judgement Outlawing Cross-Border Lending

Ugandan High Court has suspended the enforcement of a ruling that banned
foreign banks from participating in syndicated loans in the Ugandan banking
sector, pending the hearing and determination of the matter.

 

On October 13, Justice Flavian Zeija the principal Judge of the Court's
Commercial Division in Kampala issued an interim order for stay of execution
of the decree in High Court Civil Suit No.43/2020 and Miscellaneous
Application No. 654 of 2020 pending the determination of the main
application for stay of execution.

 

Justice Henry Peter Adonyo had earlier ruled on October 7 that Kenya's
Diamond Trust Bank (DTB) together with its Ugandan subsidiary (DTB Uganda)
acted illegally by jointly lending money to Ham Enterprises Ltd and Kiggs
International (U) Ltd owned by Ugandan businessman Hamis Kiggundu.

 

 

The judge also ruled that it was illegal for DTB Uganda to act as an agent
for its parent firm (DTB Kenya) in the syndicated loan without written
approval from the Bank of Uganda.

 

The judge declared that DTB Uganda and DTB Kenya breached the different loan
agreement terms entered into with Ham Enterprises Ltd and Kiggs
International Ltd between February 2011 and November 2019.

 

He declared that the credit facilities have been settled and ordered for the
recovery of Ush34.3 billion and $23.46 million recovered by the banks from
Kiggundu's account.

 

The ruling effectively outlawed cross-border lending in the country, and
thwarted efforts by other foreign banks seeking to make inroads into the
country for lending purposes.

 

 

The development could also have put on freeze an estimated $130 million
worth of intra-EAC lending and undermine the on-going regional financial
integration process.

 

Uganda's syndicated loan market is estimated at $1.53 billion, excluding
syndicated lending to the government of Uganda, while globally, the
syndicated loans market is valued at over $18.3 billion, with North America
being the largest geographic region accounting for over 50 percent of the
loans, according to data from a global consulting and research firm Business
Research Company.

 

DTB noted with concern Justice Adonyo's judgement and in consultation with
its legal advisors filed a notice of appeal against the ruling.

 

Last week the Bank of Uganda (BoU) clarified that foreign banks lending
deposits held in jurisdictions other than Uganda are regulated and
supervised by their home authorities and it is not mandatory for them to
establish representative offices in Uganda in order to conduct lending or
non-deposit-taking activity.

 

 

"Bank of Uganda's regulatory and supervisory powers only apply to financial
institution business conducted by BoU licensed entities in or outside Uganda
or activity which should be licensed as such in Uganda. These powers do not
extend to activities of foreign banks outside Uganda licensed by foreign
regulators," Governor Prof Emmanuel Tumusiime-Mutebile said in a statement.

 

This came as development partners and financing institutions demanded
clarification over the country's position on syndicated loan arrangements
and public debt obligations (domestic and external) in view of Justice
Adonyo's ruling.

 

"In this regard, the government of Uganda wishes to reiterate its commitment
made to all its financing partners in respect to all procured and future
syndicated loans and assure them that it will undertake all its obligations
and duties under the different frameworks in line with Article 160 (1) of
the Constitution of the Republic of Uganda and Section 38 of the Public
Finance Management Act (2015)," Uganda's Finance Ministry said in a
statement.

 

According to the Uganda Bankers Association, Justice Adonyo's judgement has
sent shockwaves across the entire industry and related stakeholders.

 

"This judgement is sending a message to other borrowers with foul intention
that they can now anchor their default on this judgement that declared
syndication illegal," said UBA.

 

Mr Kiggundu through his companies Ham enterprises and Kiggs International
(U) Ltd sued DTB branches in Kenya and Uganda for deducting money from his
accounts as part of the lenders' efforts to recover a loan which he was
granted between February 2011 and September 2016 and which had turned out to
be non-performing.-East African.

 

 

 

Uganda Fails to Attract New Bidders for Oil Blocks

The second extension of bids for Uganda's second oil licensing round expired
at the end of last month without any new expressions of interest received
from oil companies to explore five new blocks on offer in the Albertine
Graben, The EastAfrican has learnt.

 

And now Permanent Secretary in the Ministry of Energy Robert Kasande says as
the global outlook for upstream activity continues to look gloomy, the
ministry is set to proceed with the licensing.

 

"We got six applications in total; these are the ones we are going to
evaluate," he said.

 

In short, Uganda has lost six months as the applications to be evaluated are
from local and international companies that had expressed interest to vie
for five oil blocks on offer before the first deadline of March 30, 2020.

 

 

However, the ministry deemed the low number to represent a lukewarm response
due to prevailing conditions in the global economy, prompting the government
to push back the closing date to September 30, to give bidders more time,
hoping that conditions would be more favourable for more international
companies to apply.

 

Government officials blame the low interest on the Covid-19 pandemic that
has shrunk global economic activity, curtailed air travel and also partly
led to the collapse of the crude oil prices.

 

Now the industry projects the lowest upstream activity globally, with a
large count of rig decline.

 

In July, the Oil and Gas Journal reported the number of drilled wells
globally is expected to reach the lowest level this year since the beginning
of the century as oil and gas activity, including the drilling market both
in terms of wells drilled and related demand for drilling equipment, has
been stymied by the Covid-19 pandemic.

 

 

This year, for example, the number of drilled wells globally will fall from
71,946 wells drilled in 2019 to 55,350, oil research firm Rystad Energy
reports.

 

For Uganda and other countries hoping to start upstream activity, especially
exploratory drilling for oil, Rystad Energy's forecast paints a gloomy
picture as the decline in drilling is expected to extend to 2025.

 

Uganda launched its second licensing round for five blocks in the oil-rich
Albertine Graben during the May 8-10 2019 East African Petroleum Conference
and Exhibition in Mombasa, Kenya.

 

The five blocks up for grabs are Block01 (Avivi) covering 1,026 square
kilometres; Block02 (Omuka) covering 750 square kilometres, Block03
(Kasuruban) which stretches 1,285 square kilometres, Block04 (Turaco) that
covers 637 square kilometres and Block05 (Ngaji) covering 1230 square
kilometres.

 

 

Uganda is keen to see more upstream activity especially exploration in a bid
to strike more oil and increase its reserves above the 6.5 billion barrels
of oil that it discovered in 2006, of which an estimated 1.4 billion -1.7
billion barrels are recoverable.

 

Uganda's first competitive licensing round in 2017 did not attract global
oil majors, instead 17 small oil firms put in bids which culminated in only
two firms being picked, with Nigeria's Oranto Petroleum taking the Ngassa
oil Block, while Australia's Armour Energy Ltd was awarded the licence for
Kanywataba Block.

 

In the second round Uganda aims to increase international investment into
its oil rich energy sector, with government expecting to sign production
sharing agreements and issue exploration licences to successful firms.

 

Uganda has awarded nine production licences so far: Kingfisher field to
China National Offshore Oil Corporation in 2012; Mputa-Nzizi-Waraga,
Kasemene-Wahrindi, Kigogole-Ngara, Ngege fields to Tullow Uganda in 2016 and
Ngiri, Jobi-Rii and Gunya fields to Total E&P Uganda in 2016.

 

The recent deal between Uganda and Total for the East African Crude Oil
Pipeline is expected to unlock investment decisions for upstream and
midstream developments, with first oil expected in 2024, Total E&P Uganda
general manager Pierre Jessua says.-East African.

 

 

 

 

Uganda: Government Seeks Shs6 Trillion to Meet Budget Shortfall

Government is seeking a Shs6.2 trillion loan to finance a deficit in the
Shs45.5 trillion budget of the current financial year.

 

While tabling the request before Parliament yesterday, the State Minister of
Finance for Planning, Mr David Bahati, said out of the Shs6.2 trillion, Shs4
trillion will be borrowed from the domestic market while the rest from the
International Monetary Fund.

 

In May, the government revealed that the Shs45.5trillion budget would be
funded with Shs32.97 trillion raised locally and Shs12.52 trillion from
external sources such as loans and grants.

 

However, Mr Bahati told Parliament yesterday that because of the persistent
trends of Covid-19, there was a shortfall of revenue in the last quarter of
the 2019/2020, adding that the same problem was faced in the first quarter
of the current financial year.

 

"In the financial sector, the past financial year 2019/2020 registered a
shortfall in revenue collection of Shs1.2 trillion and in the current
financial year we are registering a shortfall of Shs2.5 trillion due to the
impact of Covid-19," Mr Bahati said.

 

 

He said currently, Shs1.5 trillion has been raised from domestic financing,
adding that it will be difficult to finance the budget without an assured
secure source of funds following the current circumstances.

 

The minister said government has been facing different financial pressures
which need attention all the time.

 

The Speaker of Parliament, Ms Rebecca Kadaga, sent the loan request to the
Committee on National Economy for scrutiny.

 

The new loan joins a line of others still being processed by the committee
chaired by Nakaseke North MP Syda Bbumba.

 

If approved, these requests will add to the current loan portfolio that
stood at Shs48.91 trillion by December last year.

 

Shortly after the government tabled the loan request, Parliament passed a
Shs3.7 trillion supplementary request that now pushes the expected
government expenditure for 2020/21 financial year to about Shs49.2 trillion.

The Ministry of Defence and State House are the biggest beneficiaries of
this supplementary budget and most of the money they are receiving is for
classified expenditure which cannot be broken down to the MPs save for the
three-man committee on classified budgets.

 

The supplementary budget, which comes four months into the current financial
year includes Shs2 trillion for recurrent expenditure which means the
government has already spent the money and Shs1.6 trillion for development
expenditure.

 

A report by the Budget Committee chaired by Amos Lugoloobi (Ntenjeru North,
NRM), indicated that the Ministry of Defence wants Shs1.1 trillion as
classified expenditure for Uganda People's Defence Forces (UPDF) for
development purposes.

 

"The Ministry of Defence and Veteran Affairs requested for Shs1.1245b to
cater for mainly classified development expenditure. The funds are to ensure
that our forces keep in tandem with technological advancements,
professionalism of the army and dealing with new challenges in the defence
sector," the report reads in part.

 

 

Defence has also already spent another Shs24.5b as a share of the Shs2
trillion recurrent expenditure.

 

The ministry was again a beneficiary of the Shs400b classified expenditure
that was part of the over Shs900b supplementary budget passed in April.
State House also received Shs90b of that additional budget.

 

This money can be spent without requiring prior parliamentary approval.

 

State House, which was allocated Shs465b out of the more than Shs600b
requested for in the budget, also in yesterday's supplementary received an
additional Shs451b.

 

This worried MPs on how much it will spend by the time Uganda goes through
the 2021 General Election.

 

"We passed a budget of Shs465b just a few months ago. That means before we
finish the first quarter of the Financial Year, State House has already
spent Shs916b when you add on the money in this supplementary. We agree that
State House has a President who does work but we still need to minimise his
spending," Mr Nandala Mafabi (Budadiri West, FDC) said.

 

Opposition Chief Whip Ibrahim Ssemujju Nganda also wondered what the
President is spending money on because "the children have now got married
and left State House."

 

Ms Cecilia Ogwal (Dokolo Woman FDC) suggested that the Ministry of Finance
should always table a lumpsum amount expected to be spent by the President
instead of always seeking supplementaries.

 

A total of Shs450b will be spent on State House's classified expenditure,
Shs1b will be spent by the President to fund the scientists tasked with the
development of an anti-tick vaccine.

 

This means, Defence and State House will spend more than Shs1.5 trillion of
the total supplementary budget on classified expenditure which is not
subject to scrutiny by Parliament's accountability committees.

 

Mr Bahati said the Classified Expenditure Committee of Parliament had looked
at the proposed areas for the classified expenditure by the State House and
passed it, adding : "The President is in State House doing work."

 

Parliament, however, deferred the Shs30b that had been budgeted for
compensation of the cattle keepers in Lango and Acholi sub-regions who lost
their livestock during the insurgency.

 

The Budget Committee and the Attorney General were tasked to ensure a
comprehensive list of beneficiaries is widely published before the funds are
disbursed to each one's personal bank account.

 

Security sector is the second highest beneficiary of the 2020/21 budget
having been allocated Shs4.5 trillion which represents 9.9 per cent of the
total budget.-Monitor.

 

 

 

Namibia: Shiimi Frees Up N$840 Million... Current Budget Remains Unchanged
At N$72.8bn

Finance minister Iipumbu Shiimi yesterday tabled the mid-term budget for the
2020/21 financial year, consisting of N$841.6 million, with no new
allocations being made but rather reallocation to priority areas.

 

Shiimi proposed that the lion's share of the reallocation, or N$326.4
million, be allocated to the basic education ministry.

 

The freed-up funds announced in yesterday's mid-term budget review consist
of N$701.6 million realised from the operational budget and N$140 million
from the development budget.

 

The finance minister emphasised the proposed reallocation of budgetary
resources leaves the overall expenditure allocation for the current
financial year budget unchanged at N$72.8 billion.

 

 

"The proposed reallocations are to meet resource shortfalls for the
provision of infrastructure and essential services in the sectors such as
basic education, health and social services, water, home affairs and safety
and security and Electoral Commission of Namibia," said Shiimi.

 

He added that the development budget ceiling has been increased by N$100
million, from N$6.41 billion to N$6.51 billion.

 

Shiimi explained that this mid-term budget averts deep expenditure revisions
and protects spending which enhances long-term growth and the provision of
essential goods and services.

 

"It avoids sudden withdrawal of resources from the national programmes
dedicated to combating Covid-19. It enhances allocative efficiency by
reallocating resources to priority programmes where funding is required for
better outcomes," he noted.

 

 

The finance minister explained that N$140 million was realized from
respective ceilings of the development budget for reallocation to various
budget votes in addition to the N$100 million, bringing the total amount of
N$240 million for reallocation to the development budget.

 

He continued that N$701.6 million was realised from the non-interest
operational budget of which N$601.6 million is proposed for reallocation
across budget votes within the non-interest operational budget.

 

Meanwhile, the total non-interest budget was reduced by N$767.1 million,
from N$57.92 billion to N$57.15 billion, of which N$667.1 million is
reallocated to statutory expenditure to cater for increased statutory
spending needs.

 

Economic analysts agreed that the mid-term budget held no real surprises,
saying that allocations were mostly made in line with expectations to
mitigate the devastating impact of Covid-19.

 

Reactions

 

 

Economic lecturer at the University of Namibia Omu Kakujaha-Matundu
questioned what would drive growth if Namibia's main trading partners are
also expected to record negative or low growth next year.

 

He said even an economic powerhouse like China is only expected to grow by
around 1%.

 

"The tourism sector is unlikely to recover at least until 2022, as an
optimistic prediction for a viable and effective vaccine against Covid-19 is
only in the first quarter of 2021. More loss of employment across sectors is
expected over the next of two years or so," Kakujaha-Matundu said, adding
domestic economy is likely to contract more before it recovers.

 

"What is there to stimulate the economy? This sounds like a phantom
balancing by a politician rather than informed by facts on the ground. I
expected to hear concrete measures, but the minister just referred to the
same old of Harambee and the African Development Bank loan, which so far has
yielded marginal results. Good talk, but I think we have grown immune to it,
so the taste is in the pudding," said Kakujaha-Matundu.

 

Also commenting, managing director of Sanlam Investments Tega Shiimi Ya
Shiimi, said that as with the minister's first budget earlier this year, he
had very little to work with and that Covid-19 further worsened his options.

 

"The stated policy reforms are encouraging, and one would hope that there is
political will to roll these out efficiently, effectively and timeously.
Policy certainty and reform is critical in attracting necessary investment
into our ailing economy, both domestically and internationally. Although not
enough, it is also encouraging to see further allocations to the development
budget," said Shiimi Ya Shiimi.

 

Lameck Odada, an economics lecturer at the Namibia University of Science and
Technology, also noted that the budget was delivered largely as expected.

 

"The question is how did he decide the reallocation? I see public
enterprises are still supported. Very interesting that I don't see anything
related to online learning, especially devices and cost of data. Now again,
how will the implementation be monitored? Very good on paper but there will
be a need for knowing how monitoring and evaluation will be done. In short,
we should get a detailed document showing the specifics of how these
objectives will be implemented, monitored and evaluated," said Odada.-New
Era.

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

Cellphone:      <tel:%2B263%2077%20344%201674> +263 77 344 1674

Alt. Email:       <mailto:info at bulls.co.zw> info at bulls.co.zw  

Website:         <http://www.bullszimbabwe.com> www.bullszimbabwe.com 

Blog:
<https://bullszimbabwe.com/category/blogs/bullish-thoughts/>
www.bullszimbabwe.com/blog

Twitter:         @bullsbears2010

LinkedIn:       Bulls n Bears Zimbabwe

Facebook:
<http://www.google.com/url?q=http%3A%2F%2Fwww.facebook.com%2FBullsBearsZimba
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www.facebook.com/BullsBearsZimbabwe

Skype:         Bulls.Bears 



 

 

 


 

INVESTORS DIARY 2020

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


Falgold

EGM

1st Floor, KPMG Building, 133 Josiah Tongogara Avenue, Bulawayo

29/10/2020 | 10:00 am

 


Afdis

AGM

virtual

13/11/2020 | 12:20pm

 


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.

 


 

 


(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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