Major International Business Headlines Brief::: 09 January 2021

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Major International Business Headlines Brief::: 09 January 2021

 


 

 




 


 

 


ü  OECD: Lockdowns here to stay, even with vaccine plan

ü  US hit as jobs fall for first time since April

ü  Brexit: M&S temporarily cuts hundreds of products in NI

ü  BA Holidays reverses decision to continue sales

ü  Google Chrome browser privacy plan investigated in UK

ü  Ethiopia: AfCFTA Stepping Stone to Continental Prosperity

ü  Seychelles: Central Bank of Seychelles Warns That 2021 Reforms Could Be Harder Than 2008

ü  Tanzania, Chinese Firms Sign 3tri/ - Deal for Isaka-Mwanza SGR Project

ü  Ethiopia: Monetizing Mining Industry

ü  Tesla market value crosses $800 billion for the first time

ü  'Twitter shares down over 2% in after-hours trading after Trump suspension

ü  IMF board, citing increased credit exposure risks, raises reserve target

ü  U.S. economy loses jobs as COVID-19 hammers restaurants, bars

 

 


 

 


OECD: Lockdowns here to stay, even with vaccine plan

More lockdowns and social distancing - even with a global vaccine rollout in place.

 

That's the sobering forecast for 2021 from Laurence Boone, the chief economist of the Organisation of Economic Cooperation and Development.

 

"We probably have another six to nine or twelve months of this ahead of us," she told the BBC's Talking Business Asia programme.

 

"I'm not saying it's easy, I'm saying we've seen that it worked in 2020".

 

"We must keep going both with the non-pharmaceutical measures, the government support and deploy the vaccine, as long and efficiently as fast as efficiently and securely as possible."

 

A new strain of the virus has led to fresh lockdowns in many parts of the world - including countries in Asia, such as South Korea, that have up until now managed to constrain new infections.

 

Nevertheless, the OECD says the global economic outlook for 2021 will improve - albeit from a low base.

 

It is expecting global GDP to rise to pre-pandemic levels by the end of this year, but warned that recovery won't be equal across all countries.

 

China, for instance, is expected to grow by 8% in 2021, while other OECD member economies are expected to grow by just over 3% on average.

 

The international economic body added that how well countries will recover will depend on how smooth the rollout of vaccines is.

 

Higher debt ahead

Speaking from Paris, Ms Boone also explained that governments have to keep spending to help shore up their economies in the face of this unprecedented crisis - even if that means adopting a more relaxed attitude to managing national budgets.

 

"These measures that we have strongly advocated do make sense because this crisis is temporary. So we're talking about temporary measures and a temporary increase in debt to GDP ratio," she said.

 

"Once we're out of the crisis, the economic fabric would have been preserved thanks to these measures, then we will have to take a step back, look at the evolution of public finances across country not only since COVID-19, but also since the financial crisis and see... whether governments are spending their money on the right priorities."

 

This is a different approach from the advice the OECD gave countries in the wake of the global financial crisis of 2008, when it advocated austerity.

 

The stark forecast highlights how challenging the health crisis has been for both rich and poor countries - and the difficult road they now face.

 

The OECD also warns of widening inequality, with lower paid workers in informal jobs at most risk.--BBC

 

 

 

US hit as jobs fall for first time since April

The US economy lost jobs last month for the first time since April as rising coronavirus cases took a toll.

 

Employers shed 140,000 positions, leaving the jobless rate unchanged at 6.7%.

 

Restaurants and bars led the payroll declines, as new restrictions in some places and cold weather sapped enthusiasm for outdoor dining.

 

The figures were the latest sign that the fragile economic recovery from the pandemic remains at risk.

 

The US has regained about half of the more than 20 million positions lost at the height of the lockdowns this spring.

 

But nearly 11 million people remain out of work, while more than seven million others would like a job, but have given up looking or are unavailable for other reasons, the Labor Department said.

 

The losses have hit low-wage and minority workers hardest, exacerbating divisions that pre-dated the pandemic, while job growth had been slowing even before last month's decline.

 

The Labor Department said the US had gained more jobs in October and November than previously estimated, reducing some of the sting of Friday's numbers.

 

But the report comes as other data shows consumer spending and confidence has weakened, even as vaccine approvals bring hope that life will start returning to normal.

 

"This is not what recovery looks like," Elizabeth Pancotti, a senior adviser at Employ America, a liberal advocacy group focused on the labour market, said on Twitter.

 

Other economists said job gains in sectors apart from leisure and hospitality bode well for future growth, pointing to hiring by construction, retail and transportation and warehousing firms last month.

 

"While the fall... in December was far worse than the consensus estimate... it arguably overstates the weakness of the economy," wrote Michael Pearce, senior US economist at Capital Economics.

 

"With employment in most other sectors rising strongly, the economy appears to be carrying more momentum into 2021 than we had thought."

 

After months of wrangling, the US approved roughly $900bn more in emergency pandemic aid in December, extending unemployment benefits and sending more money to small businesses.

 

President-elect Joe Biden has said he hopes to do more when he enters office, with his party focused on aid for state and local governments, as well as new stimulus cheques.

 

"The latest round of Covid relief ... is poised to help," said Sarah House, senior economist at Wells Fargo, of December's measure. "Nevertheless, the next few months are likely to be remain bleak in the jobs market as the pandemic continues to rage."

 

The jobs situation in the US was recovering, but the surge in infections and steps to contain them have sent the labour market sharply into reverse.

 

The big impact was on businesses where personal contact is important.

 

The number of jobs in leisure and hospitality fell by nearly half a million, partly offset by gains in some other sectors including retail, transport and warehouses.

 

Almost a quarter of those who did have jobs last month "teleworked"; that's mainly from home because of the pandemic.

 

Total employment remains nearly ten million below its pre-pandemic level.

 

The incoming president didn't need to be reminded of the twin priorities he will face: the pandemic and the economy. But these figures and what lies behind them really do highlight the biggest challenges he faces.--BBC

 

 

 

Brexit: M&S temporarily cuts hundreds of products in NI

Marks & Spencer's has temporarily stopped selling hundreds of items in its Northern Ireland stores due to Brexit red tape.

 

The retailer said it feared its food would be blocked due to new rules governing shipments between Great Britain and Northern Ireland.

 

A growing number of firms have spoken out about paperwork delays at ports.

 

The government said traders and hauliers need to take steps to comply with new border rules.

 

M&S took the decision to temporarily drop hundreds of products, including chocolate fudge pudding and sweet and sour chicken, from its Northern Ireland stores after it saw competitors' lorries barred from travelling between the mainland and Northern Ireland.

 

An entire consignment in a lorry can be held up if only one item in the truck doesn't have the correct customs forms filled out.

 

The retailer said it aimed to get the products back up for sale soon.

 

An M&S spokesperson said: "We have served customers in Northern Ireland for over 50 years and our priority is to make sure we continue to deliver the same choice and great quality range that our loyal customers have always enjoyed.

 

"Stores have been receiving regular deliveries this week, however following the UK's recent departure from the EU, we are transitioning to new processes and we're working closely with our partners and suppliers to ensure customers can continue to enjoy a great range of products."

 

Tax on Percy Pig

In addition to problems shipping goods internally in the UK, the new Brexit trade rules are creating problems for exporters and traders transporting goods to and from the EU, say firms.

 

The UK sealed a trade deal with the European Union (EU) on 24 December that was billed as preserving its zero-tariff and zero-quota access to the bloc's single market.

 

But in addition to red tape causing delays, major retailers that use the UK as a distribution hub for European business could face possible tariffs if they re-export goods to the EU.

 

On Friday, M&S chief executive Steve Rowe warned of more red tape and a rise in export costs to some countries.

 

"The best example I can give you of that is Percy Pig," he said,

 

"Percy Pig is actually manufactured in Germany. If it comes to the UK and we then send it to Ireland, in theory it would have some tax on it," he added.

 

M&S said it was "actively working to mitigate" the effects of the "rules of origin" regulations, under which products are taxed differently depending on which country they come from.

 

Other firms have also been hit by the confusion caused by new Brexit trading rules.

 

Parcels giant DPD has suspended some services, while seafood exporter John Ross said the chaos was like being "thrown in the cold Atlantic without a lifejacket".

 

Shane Brennan, chief executive of the Cold Chain Federation, which represents chilled transport and storage companies, said the emerging problems had come despite the amount of cross-border traffic still being quite low.

 

"Trade flows are still only about 50% of what we would expect, but even at those levels we are seeing levels of confusion and delays," he told the BBC's Today programme. "The feeling is we are building to quite a significant potential disruption."

 

A government spokesman acknowledged that there had been "some issues", but said ministers had always been clear there would be some disruption at the end of the transition period.

 

The Cabinet Office said in a statement that the volume of border crossings had been low so far this year, but that it expected crossings to steadily increase to normal levels.

 

This brings the potential for "significant disruption if traders and hauliers have not taken the necessary steps to comply with the new rules," the Cabinet Office said.

 

Out of about 1,500 lorries per day trying to get from Great Britain to the EU in the new year, 700 have been turned away - mainly due to a lack of a negative Covid test for drivers, it said.

 

"We have always been clear there would be changes now that we are out of the customs union and single market, so full compliance with the new rules is vital to avoid disruption," said Cabinet Office minister Michael Gove.

 

However, anger is growing among companies whose livelihoods depend on export trade.

 

In a letter on Friday to Business Secretary Alok Sharma, Scottish salmon producer John Ross Jr launched a stinging attack on the government's handling of the situation.

 

The firm's sales director, Victoria Leigh-Pearson, wrote that the company had in recent months "had to endure the government issuing a barrage of useless information" and an "absence of factually correct information from all government agencies." It amounted, she said, to "gross incompetence".

 

Part of the letter to Alok Sharma:

 

As I write, perishable goods that were dispatched from our facility five days ago, headed for France following a process that your department advised, have still not crossed the border. This usually takes only 24 hours because they are consolidated with the produce of other companies, which have not been able to follow the correct procedures due to a knowledge gap directly attributable to your department.

 

Entire trucks are currently being rejected without explanation by the French customs authority. Our hauliers have now pulled their services as such a backlog has been created. Other hauliers are not taking on new customers. Today, we've even had confirmation that the IT systems of the UK and France are incompatible. After four years you only establish this now?

 

Your so-called 'deal' is worthless if this situation is not fixed immediately, and unless you put in place measures to address the issues that continue to unfold on a daily basis. Moreover, as a seafood exporter, it feels as though our own government has thrown us into the cold Atlantic waters without a lifejacket.

 

Yours sincerely, Victoria Leigh-Pearson, Sales Director, John Ross

 

John Ross is not the only Scottish seafood exporter suffering. The industry says it has been hit by a "perfect storm" of Brexit disruption, which could sink a centuries-old industry.

 

"These businesses are not transporting toilet rolls or widgets. They are exporting the highest quality, perishable seafood which has a finite window to get to markets in peak condition," said Donna Fordyce, chief executive of Seafood Scotland.

 

"If the window closes, these consignments go to landfill."

 

She said the sector has already been weakened by Covid-19, the closure of the French border before Christmas as well as "layer upon layer" of problems associated with Brexit.

 

The group fears that without exports, the fishing fleet will have little reason to go out.

 

"In a very short time, we could see the destruction of a centuries-old market which contributes significantly to the Scottish economy," added Ms Fordyce.

 

UK government Minister for Scotland David Duguid blamed Scottish leaders for the issues.

 

"The Scottish Government has persistently refused to accept the democratic vote to leave the EU, but that does not allow them to abdicate their responsibilities to Scottish businesses," he said.

 

"Over the past 18 months they have assured the fishing industry that the systems they were putting in place would be adequate. They clearly are not."

 

Lost in the mail

Parcel delivery service DPD UK said it had paused its European Road Service because of the '"increased burden" of customs paperwork for packages heading to the EU, including the Republic of Ireland.

 

DPD said 20% of parcels had "incorrect or incomplete data attached", which meant they would have to be returned.

 

In an email to its business customers, the company said that it had been a "challenging few days" for its international operation, and that it would "pause and review" its service. It plans to restart on 13 January.

 

"It has now become evident that we have an increased burden with the new, more complex processes, and additional customs data we require from you for your parcels destined to Europe" the firm wrote.

 

Hauliers grinding gears

The boss of one of Wales' largest hauliers said logistical problems have emerged at the Irish border too.

 

Andrew Kinsella, managing director of Gwynedd Shipping, said his company has a backlog of 60 lorries waiting to be shipped to Dublin.

 

He said many hauliers are finding that their customers are not able to generate the special declarations that are needed to ultimately enable a lorry to get onto a ferry.

 

"Whilst you don't see queues at ports and terminals the reality is that these queues are developing elsewhere in our depot in Holyhead, in our depot in Deeside and in our depot in Newport in South Wales, and lots of hauliers have depots in the proximity of ports," he said.

 

"There are a lot of issues about demarcation about who is going to arrange the export declaration with the UK revenue authorities, who's going to arrange the import declaration, the hauliers then trying to arrange the import safety and security declaration to create an ENS number which helps you generate a PBN number so there has been a lot of everyone finding their feet".--BBC

 

 

 

BA Holidays reverses decision to continue sales

British Airways Holidays has cancelled plans to continue offering breaks to the Caribbean and elsewhere this weekend.

 

Despite the UK in lockdown and other firms halting holidays, the company was continuing sales from this Sunday.

 

However, on Friday BA Holidays said it had decided to withdraw package deals.

 

This week Tui, Jet2 and Virgin Holidays cancelled operations until mid-February because of the tighter rules.

 

In addition to trips to the Caribbean, BA Holidays was still offering breaks to Barbados, Costa Rica, Antigua and St Lucia.

 

The Gov.uk website clearly states: "You should not travel abroad unless it is permitted. This means you must not go on holiday."

 

In a reversal of its previous decision, BA Holidays told the BBC on Friday: "We've been in touch with customers due to travel in the coming days and weeks to offer a refund if their travel plans do not meet Government guidelines for permitted travel.

 

"As it's now clear most customers are travelling for leisure, we have decided to withdraw package deals from sale. Customers legally permitted to travel during the lockdown period remain able to book flights for their essential travel via ba.com."

 

The firm told the BBC earlier this week it is still selling breaks because business people use their holiday packages to aid their travel arrangements.

 

International travel in the last few months has flatlined, with tough border restrictions in place for entry into many destinations. This has meant many people have chosen to stay at home and demand has collapsed.

 

Last year was the toughest on record for the aviation industry, with airlines and airports reporting some of their worst results in their history. Tens of thousands of jobs have been lost.

 

Sophie Griffiths, editor of The Travel Trade Gazette, said the last ten months has been devastating for the sector.

 

"Most travel companies have reacted swiftly and fairly to the new lockdown rules, suspending their programmes and offering refunds or credit notes at a time when the UK travel industry continues to face immense challenges.

 

"The last ten months has been devastating for this industry, with companies rightly returning thousands of pounds in refunds but at the same time getting next to no money back in."

 

Covid vigilantes

She added: "Unlike numerous other countries, the industry has still not received any dedicated support from the UK government. Despite this, the majority of travel firms have continued to support their customers and play by the rules."

 

On social media there has been a growing movement reacting to people who have chosen to go on holiday in recent weeks.

 

So called 'covid vigilantes' have been naming and shaming alleged rule breakers, who they believe disregard the health protocols set up to stop the spread of coronavirus.

 

In the USA, Gays Over Covid has been exposing groups of travellers who are perceived to be breaking the law when they have travelled.

 

The group exposes those who have attended events, large social gatherings and partied in large groups and importing Covid risks to foreign countries. There is no evidence that they have broken the law.

 

Earlier this week, it was confirmed that reality TV star Zara Holland will be prosecuted for allegedly breaking Covid rules on holiday in Barbados.

 

Island police say the former Miss Great Britain is expected to appear in court on Wednesday, accused of "breaching quarantine".--BBC

 

 

 

Google Chrome browser privacy plan investigated in UK

Google's plan to replace web browser cookies with a system that shares less data with advertisers is being investigated in the UK.

 

The Competition and Markets Authority (CMA) said Google's plan could have a "significant impact" on news websites and the digital advertising market.

 

It had already raised concerns that publishers' profits could sink if they were unable to run personalised ads.

 

But Google said digital advertising practices had to "evolve".

 

'Too much power'

Cookies are small files a web browser stores on a user's device when they visit a webpage.

 

They can be used to remember what items a person has added to their online basket and deliver personalised content.

 

They can also be used to track somebody's activity online and deliver targeted advertising.

 

Some cookies known as cross-site or third-party cookies can let publishers track a person's web activity as they move from one website to another.

 

By default, Apple's Safari and Mozilla's Firefox browsers already block cross-site cookies.

 

But Google intends to go further by ending support for all cookies except first-party ones - those used by sites to track activity within their own pages.

 

It wants to replace them with new tools that give advertisers more limited, anonymised information such as how many users visited a promoted product's page after seeing a relevant ad - but not tie this information to individual users.

 

According to one industry group opposing the move, Google's Chrome browser is installed on more than 70% of computers in the UK.

 

So even if other web browsers do not adopt the same approach the move would still be significant.

 

"Google's Privacy Sandbox proposals will potentially have a very significant impact on publishers like newspapers, and the digital advertising market. But there are also privacy concerns to consider," said Andrea Coscelli, chief executive of the CMA.

 

Marketing monopoly

A coalition of about a dozen small tech companies and publishers - Marketers for an Open Web (Mow) - claims some of its members' revenues could drop by as much as two-thirds.

 

Moreover, it suggests the move would put too much power into Google's hands.

 

"Google will effectively control how websites can monetise and operate their business," it warned last month.

 

"This means that any business that buys or sells advertising will be reliant on Google for a part of the process, whether they like it or not.

 

"This will reduce the ability of independent players to compete with Google, strengthening its monopoly control of online commerce."

 

The group has also raised concerns about other related matters, including the tech firm's plan to end support for user-agent strings.

 

These are bits of text that browsers send to websites at the start of a user's visit to reveal details about the device and browser being used.

 

Publishers use this information to optimise the way their sites appear.

 

But Google is phasing out support on the grounds that they are also used as an alternative to cookies to track users, and sometimes cause compatibility issues.

 

The CMA previously issued a report into the matter in July.

 

At that point it acknowledged that while there were benefits to consumers from the kinds of privacy measures Google was proposing, they might be outweighed by other concerns.

 

It added that "many news publishers" had expressed concern that their news sites would become "unsustainable".

 

Dominant companies

Until recently, the European Commission was responsible for most large and complex competition cases involving the UK.

 

On 1 January, the CMA took over these responsibilities on a local level due to Brexit.

 

Last November, the government announced it would create a new Digital Markets Unit within the CMA.

 

The organisation subsequently detailed how it would to govern the behaviour of Google, Facebook and other tech platforms "that currently dominate" online markets, and give consumers "more control over how their data is used".

 

The new unit becomes operational in April, but is dependent on legislation going through Parliament before it gets new powers, and that may not happen until 2022.

 

Since that would be too late to block Google's Privacy Sandbox plans, the probe is being carried out under the existing regime.

 

Even so, all those involved will be watching closely for signs of how willing the authority is to confront the US's largest tech companies.--BBC

 

 

 

Ethiopia: AfCFTA Stepping Stone to Continental Prosperity

'Merkato', the largest open market in Ethiopia, is filled with products imported from China, India, Singapore, Italy, and Malaysia, among others. One can, sometimes, find produces locally secured. And the reason for the retailers to look outwards and import non-African goods is the fact that trade regulations and tariffs make intra-African commerce costly, inefficient and cumbersome.

 

But, after the coming into effect of the African Continental Free Trade Agreement (AfCFTA) as of the 1st of January 2021, many are hoping to see made in African products in large amounts in Merkato.

 

By the same token, Prime Minister Abiy Ahmed (Ph.D) special advisor Arkebe Oqubay (Ph.D) recently twitted in connection with the commencement of the AfCFTA that the new electric- powered Ethio-Djibouti Railway is an example of the journey of economic integration and the commitment for AfCFTA aside from illustrating Africa's commitment for green path and economic transformation.

He also underlined that environmental sustainability and economic growth are complementary.

 

With a view to creating a tariff-free continent, stimulating businesses, boosting intra-African trade, revamping industrialization as well as creating jobs , AfCFTA was signed by 54 out of 55 African countries .

 

The deal unites an estimated 3 trillion USD market, and could help realize over 84 billion USD in untapped intra-African exports, according to a new report by the African Export-Import Bank (Afreximbank).

 

The AfCFTA aims at creating a single continental market for goods and services, with free movement of business persons and investments, and paving the way for accelerating the establishment of the Continental Customs Union and expanding African trade through better harmonization and coordination of trade liberalization and facilitation regimes and instruments.

It will also expedite the regional and continental integration processes, as well as enhance competitiveness at the industry and enterprise level through exploiting opportunities for scale production, continental market access and better reallocation of resources. The agreement also commits countries to remove tariffs on 90 percent of goods, with 10 percent of "sensitive items" to be phased in later.

 

Signing the agreement, the startup of AfCFTA is one step forward to ensure economic integration between African countries, but various preconditions have to be met, and tasks have to be performed to put the agreement into action, according to a government official and macroeconomic expert.

It will also liberalize trade in services and might in the future include free movement of people and a single currency, says Musse Mindaye, Multilateral Trade Deal and Relations Director with the Ministry of Trade.

 

It will have to be ratified and put into action by individual countries to boost intra-Africa trade, which stands at around 10 percent of all trade across the continent, by creating a free trade zone. Musse also tells The Ethiopian Herald that the agreement brings together 1.2 billion people with a combined gross domestic product (GDP) of over 2 trillion USD.

 

Domestic merchants and investors will start to plan by taking the continental market into consideration. The agreement enables African countries like Ethiopia to attract potential investors who have a capacity of creating ample job opportunities as it will attract wide market opportunity,. "AfCFTA will provide a chance to prevent trade conflicts beforehand.

 

Consumers will also have a chance to buy products at a discount price. At the end of the day, the government would also be beneficiary from tax and jobs created for its fellow citizens," Musse said. However, apposite preparations have to be undertaken to put the agreement into action. In trade relations, infrastructure development always comes first and it has been implemented by the committee organized for this purpose.

 

Accordingly, the construction of roads connecting all parts of the continent has already started in various regions. "In addition, there is a need to convert informal trade exchanges to a formal one," he says adding that the signed document is a general framework agreement, which requires negotiation between 55 African countries to become effective.

 

Before and after the signing ceremony, Ethiopia has been discussing with countries on issues related to tariff and the economic sectors ready to be opened. The next point of discussion will be on the procedure of trade integration and the importance of protection, he added. These days, Ethiopia is importing products such as crude oil and fertilizer with zero tariffs from Sudan and Morocco respectively.

 

For his part , Civil Service University Economist Dr. Belay Fille says that each African country should conduct in-depth analysis about economic integration and deliberates on the matter using different regional arrangements such as COMMESA, ECOASS, and IGAD etc. He believes that tariff-free access to a huge and unified market will encourage manufacturers and service providers to leverage economies of scale; and an increase in demand will instigate an increase in production, which in turn will lower unit costs.

 

Consumers will pay less for products and services as businesses expand operations and hire additional employees. He advises that instead of competing with one another by producing monocular products and contributing their share to price fall, African countries signed AfCFTA agreement should foster regional integration and increase the monopoly power of goods.

 

Dr. Belay also states that signing an agreement by itself is nothing. "Signatories should be committed and ready to take action for the applicability of the signed agreement. What else, the infrastructural development projects being carried out jointly by countries are essential and need to be made sustainable.

 

"The visa on arrival is another point that we need to consider, it means a lot for tourism development," he notes.

 

Both scholars point out that If the agreement is successfully implemented, a free trade area could inch Africa toward its age-long economic integration ambition, possibly leading to the establishment of pan-African institutions such as the African Economic Community, African Monetary Union, and African Customs Union and so on.-Ethiopian Herald.

 

 

 

Seychelles: Central Bank of Seychelles Warns That 2021 Reforms Could Be Harder Than 2008

Each citizen of Seychelles needs to contribute towards making a sacrifice as the country enters 2021 in a much dire economic position than it did in 2020, the governor of the Central Bank of Seychelles (CBS) said on Friday.

 

"Difficult decisions will be taken in 2021 and the sacrifice required to be made has to be done by everyone to ensure that the country gets though this rough time," Carolline Abel told a news conference. Abel said that reforms in 2021 might be twice as difficult as in 2008.

 

"We need to keep in mind that we are starting the year in a position where in the previous year we have lost resources, hence started with a lower base in 2021," said the governor. She added that "we need to preserve the resources that we have at all levels to carry out what needs to be done, and not what we want, to continue a sustainable enough life."

Abel encouraged people to save money and called on the government to come up with a realistic budget.

 

Between January and November 2020, revenue coming from the tourism industry of Seychelles has seen an alarming decrease of 78 percent as compared to the same period in 2019. The decrease, among other factors, is having negative effects in terms of inflation and GDP of the island nation.

 

Caroline Abel said that with tourism being the main contributor of foreign exchange to the Seychelles' economy, a decrease in the number of visitors was reflected in the amount of revenue received from this industry. This in turn affected other economic indicators.

"The National Bureau of Statistics (NBS) this morning released its bulletin for 2020, showing that inflation in the country is alarming and is being reflected in the rising price of commodities as euro and dollar become more expensive," said Abel.

 

By the end of December, provisional information shows that the country's real GDP in the third quarter of 2020 fell by 18.6 percent as compared to the same time in 2019, Abel said. "This again goes to show that our economy has lost its ability to produce resources that we as an economy can use. When we look at the third quarter in relation to the second quarter of 2020, there was a slight improvement in activity, estimated at a 3.1 percent increase in real GDP," she continued.

 

The governor explained that this slight increase was due to the reopening the airport to commercial flights in August, which brought about the operation of certain sectors of the economy.

 

Looking at the provisional position of the reserve by the end of December, she outlined that the country had a total of $559 million, out of which $400 million could be used. She added that the current foreign exchange rate, Abel said that as of January 7, 2021, $1 amounted to SCR21.56 and €1 stood at SCR26.40 on average.

 

Restrictions being reintroduced internationally to deal with the pandemic is expected to further hinder Seychelles' ability to restart the tourism industry as well as cause an increase in the price of fuel and food.

 

"It is really important to note that our economy is still fragile and maybe even more fragile as there are limited resources in the country. We must realise that the economic situation is much more severe in 2021. We need to make the most of the resources that we have for as long as possible as there is greater level of uncertainty," said Abel.-Seychelles News Agency.

 

 

 

Tanzania, Chinese Firms Sign 3tri/ - Deal for Isaka-Mwanza SGR Project

Tanzania Railways Corporation (TRC) and two Chinese firms have signed a contract for construction of a phase five of Standard Gauge Railway project that will connect Isaka and Mwanza.

 

The China Civil Engineering Construction Corporation (CCECC) and China Railway Construction Company (CRCC) have jointly won the deal.

 

President John Magufuli and China's State Councilor and Foreign Affairs Minister Wang Yi witnessed the event in Chato, Geita on Friday.

 

Foreign Minister Wang Yi is in Tanzania for a two-day state visit.

 

Speaking after signing the contract, TRC Managing Director Mr Masanja Kadogosa said, the 341km SGR project will cost $1.326bn (equivalent to 3.0677tri/-)-Daily News.

 

 

 

Ethiopia: Monetizing Mining Industry

It appears clear that Ethiopia is inundated with a wide spectrum of worthwhile minerals that can transform the lives of the general public and create more jobs at the earliest possible opportunity if utilized in the appropriate manner beyond a shadow of a doubt.

 

In the same way, Ethiopia is blessed with precious yet neglected minerals that could make huge economic differences if properly exploited. Lack of the required finance, technology, experience has stymied the growth of the sector.

 

Yet, if appropriately managed, the sector has immense potential in bringing the much needed foreign currency and creating massive job opportunities for local communities and the way to big companies.

Indeed, the minerals do not only jewel the country but also could pour the country with huge financial resources. And there are calls from expertise to monetize the sector through providing finance, encouraging modern mining, supplying latest technologies. These measures are among the must-do tasks to transform the sector.

 

Notwithstanding the fact that the incumbent regime is moving heaven and earth with a view to creating more job opportunities for the unemployed segment of the society, the sought after goal has not been achieved yet.

 

Against this background, socioeconomic bedlam, illicit human trafficking, criminal acts, illegal migration, and things of that sort have been surfacing throughout the national territory in several instances.

 

It is abundantly clear that if Ethiopia properly takes advantage of its mineral resources in a suitable form, the country can reach new heights of success and transform the lives of the wider community without problems in a very short space of time.

On account of quite a lot of reasons, Ethiopia was not able to secure its natural assets in a way that could merit the entire population by working hand-in-glove with local government officials and other stakeholders who know the nuts and bolts of the potential mineral resources of their respective regions like the palm of their hands.

 

One of the factors barricading the general public from benefiting from the mineral resources positioned in the left, right, and center of the country is a lack of capable professionals who can bring to light the natural resources of the country no matter what the cost may be.

 

In the recent past, in an interview Dr. Eng. Abubeker Yimam Ali, an Associate Professor and Dean of School of Chemical and Bio-Engineering at Addis Ababa Institute of Technology, Addis Ababa University regarding the issue said,

"Ethiopia is also exporting several types of gemstones, such as opal, emerald, and sapphires. Opal is Ethiopia's largest gemstone export, accounting for more than 90% of all gemstones exported out of the country. However, the country is not getting the maximum benefit as the sector faces a challenge with cutting and polishing. The government should support and encourage exporters to sell only cut and polished stones directly to the global markets.

 

Ethiopia has the potential to be one of the leading exporters of lithium. Recently, an estimated 250 thousand tons of proven reserve of lithium oxide discovered at Kenticha mine. Lithium has several uses in the industry.

 

Recently, the rise in demand for electric vehicles increased the demand for lithium batteries. Global demand for lithium is expected to surge over the next decade, owing largely to the evolution of electric vehicles. Hence, the country should be ready to utilize this immense opportunity.

 

He went on to say, "The potash reserve in the Danakil, Dallol Depression of the Afar region is one of the highest in the world. Prospecting for iron, copper, and base metals is also in progress in many regions of the country. Ethiopia has an estimated more than 70 million tons of iron ore deposit in Amhara, Oromia, and Tigray region,"

 

As Iron is the key element for the manufacturing of steel, local demand for iron is expected to continue because of the infrastructure boom in the country. The government is currently working with international mining companies to explore and develop iron ore.

 

"The country has also a variety of industrial minerals such as limestone, clays, sand, gravel, diatomite, kaolin, bentonite, silica, barite, gypsum, and talc.

 

These minerals are essential raw materials for cement, ceramics, paints, glass, chemical, and paper industries. Hence, the development and expansion of industrial minerals are very important," he wrapped up.

 

Taking the aforesaid reality on the ground, all stakeholders should be able to work as alike as two peas in a pod with the intention of getting to the bottom of the problem within a short period of time.

 

By hook or crook, all the materials required for extracting minerals from the ground should be available by all means possible with a view to speeding up the job creation and taking the country to new heights of success.-Ethiopian Herald.

 

 

Tesla market value crosses $800 billion for the first time

(Reuters) - Shares of Tesla Inc jumped as much as 5.6% on Friday, pushing the electric-car maker’s market capitalization to more than $800 billion for the first time ever and inching closer to the trillion dollar club.

 

Tesla’s stratospheric rally has helped Chief Executive Officer Elon Musk surpass Amazon.com Inc’s top boss Jeff Bezos to become the world’s richest man, Bloomberg News reported on Thursday.

 

At today’s session high, Musk’s 21% stake in the automaker as per Forbes contributes more than $170 billion to his net worth, dwarfing the combined market capitalization of General Motors, Ford Motor Co and Fiat Chrysler Automobiles, the three Detroit automakers.

 

In the previous session, Tesla’s market value crossed $774 billion, making it Wall Street’s fifth most valuable company, just behind Google-parent Alphabet Inc and ahead of social media giant Facebook Inc.

 

The company’s fortunes is an anomaly as the 17-year-old automaker has production that is just a fraction of large rivals by sales such as Toyota Motor, Volkswagen and General Motors.

 

 

 

'Twitter shares down over 2% in after-hours trading after Trump suspension

NEW YORK (Reuters) - Shares of Twitter were down more than 2% in after-hours trading, moving lower after the company said it was permanently suspending U.S. President Donald Trump’s account due to the risk of further incitement of violence.

 

Shares of the stock recently traded at $50.20, down 2.4% from the closing price.

 

On Wednesday, Twitter temporarily blocked Trump’s account, which had more than 88 million followers, following the siege of Capitol Hill by pro-Trump protesters, and warned that additional violations by the president’s accounts would result in a permanent suspension.

 

 

 

IMF board, citing increased credit exposure risks, raises reserve target

WASHINGTON (Reuters) - The Executive Board of the International Monetary Fund has agreed to raise the medium-term target for the fund’s precautionary reserves given a sharp increase in financial risks since 2018, the IMF said on Friday.

 

The fund’s 24 executive directors increased the target to Special Drawing Rights 25 billion, or around $36 billion, from SDR 20 billion, or $29 billion, after a regular biannual review conducted at the end of October, the IMF said in a statement.

 

SDRs are the IMF’s own unit of currency.

 

The review, delayed by a few months to permit an assessment of the impact of the COVID-19 pandemic, showed a significant increase in the fund’s credit exposure and related risk since the last review in 2018, compounded by the pandemic.

 

“Credit outstanding has nearly doubled, including a surge in emergency financing without conditionality, and commitments under precautionary arrangements are higher than at the last review,” the IMF said in its statement.

 

It said credit had become more concentrated and scheduled repurchases were larger and more bunched. The current target for precautionary balances of SDR 20 billion was also likely to drop below the indicative range this fiscal year and next.

 

Given these developments, directors agreed to keep the minimum floor for precautionary balances - which include general and special reserves and a special contingent account - at SDR 15 billion and raise the medium-term target to SDR 25 billion, while continuing to monitor the situation carefully.

 

The IMF noted that some directors pushed for an even higher target, but did not identify them. It said they agreed to reassess the situation before the next regular review in 2022.

 

The directors agreed there was no current need to accelerate the pace of reserve accumulation, although a few directors urged consideration of options to do so.

 

The executive board noted that program design, conditionality, lending policies, and the fund’s preferred creditor status also help limit the IMF’s risk exposure.

 

 

 

U.S. economy loses jobs as COVID-19 hammers restaurants, bars

WASHINGTON (Reuters) - The U.S. economy shed jobs for the first time in eight months in December as the country buckled under an onslaught of COVID-19 infections, suggesting a significant loss of momentum that could temporarily disrupt the recovery from the pandemic.

 

The plunge in nonfarm payrolls reported by the Labor Department on Friday was concentrated in the coronavirus-sensitive leisure and hospitality sector, which lost nearly half a million jobs. But with other industries including retail, manufacturing and construction performing better, the economy is unlikely to tip back into recession.

 

Nearly $900 billion in additional pandemic relief approved by the government in late December will probably provide a backstop. More fiscal stimulus is expected now that Democrats have gained control of the U.S. Congress, boosting the prospects for President-elect Joe Biden’s legislative agenda. There is also optimism the rollout of coronavirus vaccines will be better coordinated under the incoming Biden administration.

 

Congress on Thursday formally certified Biden’s victory in the Nov. 3 election, hours after hundreds of President Donald Trump’s supporters stormed the U.S. Capitol. The employment report is one of the final scorecards delivered during the Trump presidency and stands as a reminder of the tumultuous economic crisis that marked his last months in office.

 

“This is a pause in the recovery, not a full-on stall,” said Chris Low, chief economist at FHN Financial in New York.

 

Payrolls decreased by 140,000 jobs last month, the first decline since April, after increasing by 336,000 in November. The economy has recovered 12.4 million of the 22.2 million jobs lost during the pandemic. Economists polled by Reuters had forecast 71,000 jobs would be added in December.

 

COVID-19 cases in the United States have jumped to more than 21 million, with the death toll exceeding 365,000, according to a Reuters analysis. The economy ended 2020 with 9.4 million fewer jobs.

 

The leisure and hospitality sector lost 498,000 jobs last month, with employment at bars and restaurants tumbling 372,000, accounting for three quarters of the drop. Restaurants and bars in many states, including New York and California, were shut during the holidays to slow the spread of the virus.

 

Excluding the leisure and hospitality sector, payrolls rose at roughly the same pace as in November.

 

There were also decreases in private education jobs as many universities and colleges closed after the Thanksgiving holiday. Government employment declined for a fourth straight month, with losses spread across federal state and local governments.

 

But retail employment rose by 121,000 jobs. Factories hired 38,000 workers and construction payrolls increased by 51,000 jobs. There were also gains in employment in professional and business services, transportation and warehousing, health care and wholesale trade industries.

 

Weak payrolls joined soft consumer confidence and spending in underscoring the brutal impact of the coronavirus on the economy, which sank into recession in February. The data increases the likelihood of another rescue package by March. Introducing his nominees to head the Labor and Commerce Departments, Biden said on Friday that “help is on the way.”

 

Stocks on Wall Street rose, with the Nasdaq and S&P 500 hitting record highs. The dollar gained versus a basket of currencies. U.S. Treasury prices were mostly trading lower, with the yield curve steepening.

 

With the virus hollowing out lower-wage industries, average hourly earnings surged 0.8% after gaining 0.3% in November. The average workweek dipped to 34.7 hours from 34.8.

 

Though the unemployment rate was unchanged at 6.7% in December, that was because of people misclassifying themselves as being “employed but absent from work.” Without this misclassification, the jobless rate would have been about 7.3%.

 

Despite last month’s job losses, the labor market is steadily improving. A broader measure of unemployment, which includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment, fell to 11.7% from 12.0% in November.

 

 

The number of people who have permanently lost their jobs declined by 348,000 to 3.370 million. That was the biggest drop since December 2010. Still, it will probably take years for the scars from the pandemic to heal. Nearly 4 million Americans have been unemployed for more than six weeks, accounting for 37.1% of the jobless in December.

 

The labor force participation rate, or the proportion of working-age Americans who have a job or are looking for one, remains at a depressed 61.5%. The employment-to-population ratio, seen as a measure of an economy’s ability to create jobs, held at a low 57.4%.

 

Economists are optimistic employment will rebound in the months ahead and accelerate through 2021 amid expectations for increased inoculations and additional fiscal stimulus, including more infrastructure spending under the Biden administration.

 

“Savings are burning a hole in many people’s pockets after having to avoid travel, in-person dining and entertainment for nearly a year,” said Sarah House, a senior economist at Wells Fargo Securities in Charlotte, North Carolina. “Hiring could ramp up quickly once COVID cases are more under control.”

 

Many economists have upgraded their 2021 growth estimates following the recent relief package and the shift of power in Washington to the Democrats.

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2021

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


ART

Seed co Int.

Dairibord

 


Starafrica

Medtech

Turnall

 


Seed co

 

 

 


 

 

 

 


 <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) 2021 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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