Major International Business Headlines Brief::: 26 January 2021

[Bulls n Bears]

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Major International Business Headlines Brief::: 26 January 2021

 


 

 

	
 


 

 


ü  Coronavirus: Seafarers stuck at sea ‘a humanitarian crisis’

ü  Janet Yellen to be first female US treasury secretary

ü  Harvey Weinstein: Court agrees $17m payout for accusers

ü  Co-op and Morrisons see queues over payments outage

ü  Deloitte Football Money League: Pandemic set to cost top clubs over
£1.7bn

ü  Mastercard to push up fees for UK purchases from EU

ü  Apple's hardware engineering chief to step down to focus on new project

ü  Hyundai Motor fourth-quarter profit jumps 57% on demand for SUVs, Genesis

ü  South Korea probes adequacy of Hyundai's Kona EV recall after new fire:
ministry official

ü  Nissan flips the switch on electric reboot in China

ü  Oil drops as U.S. stimulus wrangles, rising COVID-19 cases hit sentiment

ü  Investor payouts and job cuts jar with U.S. companies' social pledge

ü  Asian stocks weaken on stimulus worries, dollar holds firm

ü  Liberia's Banknote Shortage Undermines George Weah's Pro-Poor Presidency

ü  Kenya: CS Amina for Eldoret as New Contractor Picked for Kip Keino
Stadium

ü  Namibia: Diamond Sales Back With a Bang

ü  South Africa: Western Cape Finance and Economic Opportunities On Tourism
Sector Under Level 3

 

 


 <mailto:info at bulls.co.zw> 

 


Coronavirus: Seafarers stuck at sea ‘a humanitarian crisis’

The fate of more than 200,000 seafarers who play a crucial role in keeping
global trade flowing is being labelled a "humanitarian crisis at sea".

 

More than 300 firms and organisations are urging for them to be treated as
"key workers", so they can return home without risking public health.

 

More than 90% of global trade - from household goods to medical supplies -
is moved by sea.

 

But governments have banned crew from coming ashore amid Covid-19 fears.

 

Large firms including shipping titan AP Moller-Maersk, oil firms BP and
Shell, consumer giant Unilever and mining groups Rio Tinto and Vale, as well
as maritime transporters, unions, the World Economic Forum (WEF) and other
supply chain partners have signed the Neptune Declaration on Seafarer
Wellbeing and Crew Change.

 

They are calling for all countries to designate seafarers as key workers and
implement crew change protocols.

 

The signees of the Neptune Declaration are warning global leaders that
ignoring the risk to crews' mental and physical wellbeing threatens global
supply chains, which are crucial to vaccinating the world from coronavirus.

 

The firms and organisations hope that world leaders, gathering at this
year's virtual Davos Forum, will heed their call.

 

"Unified, prompt action from governments and other key stakeholders is
needed to protect the lives and livelihoods of the 1.6 million seafaring men
and women who serve us all across the seas, and who continue to face extreme
risk to their safety and earnings," said WEF's head of supply chain and
transport Margi Van Gogh.

 

"By granting stranded seafarers key worker status, and by prioritising
vaccine allocation for transport crew, we can prevent a deepening
humanitarian and economic crisis."

 

Risk to mental and physical wellbeing

According to latest data from the International Chamber of Shipping (ICS)
and international ship owners body Bimco, there are 1.6 million seafarers
serving on internationally trading merchant ships worldwide.

 

Typically, ICS estimates around 100,000 seafarers are rotated every month,
with 50,000 staff disembarking and 50,000 crew embarking ships to comply
with international maritime regulations, governing safe working hours and
crew welfare.

 

Seafarers usually work 10-12 hours shifts, seven days a week to man ships,
on four or six-month-long contracts, followed by a period of leave.

 

But due to the coronavirus crisis and travel bans brought in by many
governments to combat new variants of Covid-19, hundreds of thousands of
crew are spending extended periods at sea, far beyond the expiry of their
contracts.

 

For those who have been at sea for months longer than their contract
stipulates, there is a growing risk to their mental and physical wellbeing.

 

"Seafarers are the unacceptable collateral damage on the war on Covid-19 and
this must stop," said ICS secretary general Guy Platten.

 

"If we want to maintain global trade seafarers must not be put to the back
of the vaccine queue. You can't inject a global population without the
shipping industry and most importantly our seafarers. We are calling on the
supply chain to take action to support seafarers now."—BBC

 

 

 

Janet Yellen to be first female US treasury secretary

Janet Yellen has been confirmed as the first ever female US treasury
secretary in a Senate vote.

 

Ms Yellen, who headed the US central bank from 2014 to 2018, earlier won
bipartisan support from members of the Senate Finance Committee.

 

She will be responsible for guiding the Biden administration's economic
response to the pandemic.

 

The US is struggling to rebound economically from the hit caused by the
coronavirus pandemic.

 

At her confirmation hearing on 19 January, Ms Yellen urged Congress to
approve trillions more in pandemic relief and economic stimulus, saying that
lawmakers should "act big" without worrying about national debt.

 

In response, Republican senators warned the former Federal Reserve head this
was not the time for "a laundry list" of liberal reforms.

 

Ms Yellen disagreed, highlighting the fact that many families whose incomes
have fallen were not reached by jobless programmes. She argued that plans to
raise taxes must be seen in the context of financing bigger investments
necessary to make the US economy competitive.

 

"The focus now is not on tax increases. It is on programmes to help us get
through the pandemic," she stressed.

 

Who is Janet Yellen?

Janet Yellen was previously chair of the US Federal Reserve. She was known
for focusing more attention on the impact of the central bank's policies on
workers and the costs of America's rising inequality.

 

Before then-President Barack Obama named her to lead the Fed in 2014, she
had served as one of its board members for a decade, including four years as
vice-chair.

 

Donald Trump bucked Washington tradition when he opted not to appoint Ms
Yellen to a second four-year term at the Fed.

 

However, her climb to the top of the economics profession had made her a
feminist icon in the economics world.

 

When she left the Fed in 2018, many paid tribute to her leadership by
imitating her signature look of a blazer with a popped collar.

 

Ms Yellen is seen as someone able to satisfy both progressive and centrist
members of Mr Biden's Democratic party. Her nomination to lead the Fed in
2014 won support from some Republicans.

 

Her focus on employment, rather than inflation, gave her a reputation of
favouring low interest rates, which spur economic activity by making it less
expensive to borrow money.

 

But under her leadership, the Fed raised interest rates for the first time
since 2008 - albeit less aggressively than some more conservative
commentators supported.

 

Her stewardship of that process has won praise on Wall Street, even as it
remains hotly debated.--BBC

 

 

 

Harvey Weinstein: Court agrees $17m payout for accusers

A US bankruptcy judge has agreed a $17m (£12.4m) payout to women who accused
disgraced film director Harvey Weinstein of sexual misconduct.

 

Weinstein, 68, was convicted last year and jailed for 23 years for rape and
sexual assault.

 

The payout for his victims will come from the liquidation of the Weinstein
Co, which filed for bankruptcy in 2018.

 

The judge overruled an objection from some accusers looking to pursue
appeals outside of bankruptcy court.

 

Judge Mary Walrath said without the settlement, the plaintiffs would get
"minimal, if any, recovery."

 

The Weinstein Co was set up as an independent film studio with the disgraced
Hollywood mogul one of its co-founders.

 

The company collapsed in late 2017, following widespread claims of sexual
misconduct against Weinstein, who was convicted of sexually assaulting a
former production assistant and raping an actress.

 

The US judge said that 83% of sexual misconduct claimants in the bankruptcy
"have expressed very loudly that they want closure through acceptance of
this plan, that they do not seek to have to go through any further
litigation in order to receive some recovery, some possible recompense...
although it's clear that money will never give them that".

 

The $17m fund will be divided among more than 50 claimants, with the most
serious allegations resulting in payouts of $500,000 or more.

 

The settlement was put to a vote of Weinstein's accusers, with 39 voting in
favour and eight opposed.

 

They will have the option to forgo most of their payout under the plan if
they want to continue pursuing their claims.

 

Insurers contributed $35m under the liquidation plan, which also provides
$9.7m to the former officers and directors of the Weinstein Co, allowing
them to pay a portion of their legal bills over the last several years.

 

The directors and officers, who include Weinstein's brother, Bob, also
received releases that absolve them of any potential liability for enabling
Weinstein's conduct.

 

The Weinstein Co sold its assets to Lantern Entertainment, which later
became Spyglass Media Group, for $289m.--BBC

 

 

 

Co-op and Morrisons see queues over payments outage

The Co-op and Morrisons have confirmed that there is an ongoing issue
affecting card payments from being processed in some of their stores.

 

Long queues were seen outside some of the Co-op's convenience stores from
Sunday amid the snow, and customers were encouraged to pay using cash.

 

The BBC understands that the problem is due to an issue with a real-time
payments processing provider ACI.

 

Multiple customers took to Twitter and Facebook to complain about the
queues.

 

The issue comes as contactless payments have taken off in the UK during the
pandemic, with fewer consumers using cash to pay for groceries.

 

"We've experienced some technical difficulties with our card payments and
are working hard to resolve this as quickly as possible," said a Morrisons
spokeswoman. "We are sorry for any inconvenience this may have caused."

 

The BBC witnessed the card processing issue affecting some of The Co-op's
stores meant that self-service checkouts had to be closed, requiring
customers to queue to be served at tills manned by staff.

 

At some stores, customers queuing outside were warned on Monday evening that
transactions had to be "cash-only" due to the ongoing issue.

 

Some customers said they had to use the convenience store's cash machine to
withdraw money to pay for purchases.

 

However in other stores, the problem was intermittent, impacting some
payment card brands, but not others.--BBC

 

 

 

Deloitte Football Money League: Pandemic set to cost top clubs over £1.7bn

The coronavirus pandemic will cost Europe's 20 richest football clubs over
£1.7bn by the end of this season.

 

The Deloitte Football Money League survey found the clubs had already lost
around £976m up to the end of the extended 2019-20 season.

 

Clubs have suffered considerable losses on both broadcast and matchday
revenue.

 

Barcelona generated more money than any other club in Europe, but still had
the second-largest revenue fall in absolute terms.

 

The Catalan club saw a drop from £741.1m to £627.1m but remain narrowly
ahead of La Liga rivals Real Madrid, whose revenue fell from £667.5m to
£627m.

 

Bayern Munich (£556.1m), Manchester United (£509m) and Liverpool (£489.9m)
make up the top five with Liverpool moving up from seventh last year,
replacing Paris St-Germain.

 

Manchester City, Chelsea, Tottenham Hotspur and Juventus make up the
remainder of the top 10.

 

Eighteen of the 20 clubs retain their places from last year's survey - with
Zenit St Petersburg (15th - £207.4m) and Eintracht Frankfurt (20th - £152.6)
replacing AS Roma and West Ham United.

 

What caused the income drop?

Coronavirus has caused havoc in the world of sport for much of 2020 and into
2021.

 

It led to the postponement in March of top divisions in England, Spain,
Germany, Russia and France. The French Ligue 1 season was cancelled, while
the Bundesliga resumed in mid-May with other leagues following in June - all
behind closed doors.

 

Clubs suffered an £832m drop in broadcast revenue, primarily due to the
delayed ending of the 2019-20 season meaning the deferral of broadcast
revenue into the financial year ending in 2021, but also because of
broadcaster rebates related to the disrupted 2019-20 season.

 

For example, Manchester United said in October that their broadcasting
revenue had been reduced 41.9% from £240.2m to £141.2m.

 

Manchester United financial statement shows £70m drop

There was also a £228m overall fall for the 20 clubs in matchday revenue,
although there was a £93m increase in commercial revenue.

 

The matchday revenue figure will fall even further for all clubs with fans
unlikely to be able to return in significant numbers for any of the 2020-21
season.

 

'Testing times'

"There is no doubt that this is one of the most testing times the football
industry has ever had to endure," said Dan Jones, partner in the Sports
Business Group at Deloitte.

 

"While no football club has been immune to the challenges of Covid-19, and
other clubs have suffered more in relative terms, those in the Money League
have borne the greatest financial impact in absolute value terms.

 

"The safe return of fans to stadia in significant numbers is one of the
highest priorities across global football. Matchday operations are a
cornerstone of a club's business model and help drive other
revenue-generating activity.

 

"Fans' absence will be more fully reflected in next year's Money League. The
final size of the financial impact of the pandemic on football will depend,
in no small part, on the timing and scale of fans' return."

 

Can the sport recover?

"We remain strong believers in the fundamental value of top-level football
to fans, broadcasters and other commercial partners," insists Jones.

 

"We are confident in the resilience of the industry and expect it to bounce
back strongly in future years.

 

"The events of the past year have challenged the ability of clubs to drive
their own revenue growth. Any short-term ambitions they may have had will
likely only be achievable as medium-term goals once fans return to stadia
and the effect of the pandemic on the global economy and the path to
recovery from it becomes clearer.

 

"However, the full financial impact of Covid-19 may not be realised for
years to come."--BBC

 

 

 

 

Mastercard to push up fees for UK purchases from EU

Credit card giant Mastercard is to raise the fees it charges EU merchants
when UK cardholders buy goods and services from them online by fivefold.

 

It has sparked fears that consumer prices could rise if merchants choose to
pass on those costs, especially on items not available from UK retailers.

 

Transactions with airlines, hotels, car rentals and holiday firms based in
the EU could all be affected.

 

Mastercard attributed the move to the UK's decision to leave the EU.

 

It said that only online sales would be affected and that "in practice" UK
consumers would not notice the change.

 

The change affects the "interchange" fees Mastercard sets on behalf of big
banks, so that its customers can use their payment networks.

 

>From October, Mastercard said it would increase these fees to 1.5% on every
transaction, up from 0.3%.

 

The EU introduced a cap on such fees in 2015 after concerns they pushed
prices up for consumers and unfairly burdened companies.

 

British customers makes tens of billions of pounds of purchases every year
from European merchants on credit cards alone - and the hike in fees from
Mastercard will affect the majority of those.

 

The increase may be relatively small but it's significant, coming at a time
when retailers may face extra paperwork and checks - higher costs - for
goods coming into the UK.

 

With Covid restrictions bringing their own challenges, businesses,
especially smaller ones, may be compelled to pass on the costs to consumers.

 

And it's not just items crossing borders. The payments for most items bought
on Amazon in the UK are processed via its Luxembourg headquarters.

 

With the increase not coming in for several months, international companies
may look at ways to reclassify UK sales, to avoid the charges.

 

Mastercard is implementing the rises simply as it's no longer bound by the
restrictions imposed by the UK being in the EU. The banks which receive the
fees have said in the past that they are invested in areas such as card
security and innovation. This time, however, the trade body which represents
them has declined to comment on the rises.

 

But Mastercard said that since the end of the Brexit transition period, the
cap no longer applied to many payments between the UK and European Economic
Area (which also includes Iceland, Liechtenstein and Norway).

 

"As a result of the UK leaving the EEA, Mastercard will adapt interchange
rates on UK cards to the commitments it gave the European Commission in 2019
for non-EEA card transactions," the company said.

 

"In practice, only EEA merchants making e-commerce sales to UK cardholders
will see a change."

 

'Opportunism'

Kevin Hollinrake, chair of the parliamentary group on Fair Business Banking,
told the Financial Times, which first reported the story, that the move
"smacks of opportunism".

 

And Callum Godwin, chief economist at CMSPI, the global payments
consultancy, said airlines, hotels, car rentals and travel groups would be
hit.

 

"[This will happen] anywhere the consumer is in the UK and the merchant is
in the EU," he said.

 

He added that many firms in these industries were already struggling due to
the pandemic. 

 

Visa, Mastercard's larger rival, has not announced plans to change its fees
but told the FT it was keeping the issue under review.

 

Companies in the UK and EU are already facing added costs and delays due to
post-Brexit trade rules brought in on 1 January.

 

Some EU exporters have already stopped deliveries to the UK because of new
VAT related charges.

 

Meanwhile, UK consumers who have bought goods from firms based in the bloc
have found themselves facing hefty charges to cover customs duties, taxes
and administration.--BBC

 

 

 

Apple's hardware engineering chief to step down to focus on new project

(Reuters) - Apple Inc’s hardware engineering chief, Dan Riccio, will step
down to oversee a new project, the iPhone maker said on Monday, providing
few details on the longtime executive’s latest role.

 

Riccio will report to Chief Executive Officer Tim Cook, Apple said in a
statement. He will be replaced by company veteran John Ternus, who will join
the executive team as senior vice president of hardware engineering.

 

Riccio, who joined Apple over two decades ago as vice president of product
design, was named vice president of iPad hardware engineering in 2010 and
leads the Mac, iPhone, iPad and iPod engineering teams.

 

The company has been focusing on newer projects and moving forward with
self-driving car technology, targeting 2024 to produce a passenger vehicle
that could include its own breakthrough battery technology, Reuters had
reported last month.

 

 

 

 

Hyundai Motor fourth-quarter profit jumps 57% on demand for SUVs, Genesis

SEOUL (Reuters) - South Korea’s Hyundai Motor Co reported on Tuesday a 57%
jump in fourth-quarter profit, slightly below analyst estimates, backed by
demand for high-margin sports-utility vehicles and its premium Genesis cars.

 

Hyundai, which together with affiliate Kia Corp is among the world’s top 10
automakers, reported a net profit of 1.3 trillion won ($1.18 billion) for
October-December, versus 804 billion won a year earlier.

 

That compared with the 1.5 trillion won average of 16 analyst estimates
compiled by Refinitiv.

 

Revenue rose 5% to 29.2 trillion won, Hyundai said in a regulatory filing.

 

The South Korean automaker’s stock has risen over a third this month, helped
by news it was discussing an electric car and battery tie-up with Apple Inc.

 

 

 

South Korea probes adequacy of Hyundai's Kona EV recall after new fire:
ministry official

SEOUL (Reuters) - A Hyundai Motor Kona electric vehicle caught fire last
week in the first-ever known case of a recalled Kona catching fire,
prompting authorities to investigate the adequacy of the recall, a South
Korean transport ministry official said.

 

A series of fires prompted mass recalls of Hyundai’s best-selling Kona EV in
South Korea in October.

 

The latest Kona fire, on Saturday in the city of Daegu, is among 11 reported
so far in the country. But this incident was different as it was the first
Kona EV to catch fire after undergoing the recall process, the official said
on Tuesday.

 

In South Korea, Hyundai has recalled 25,564 Kona EVs built during September
2017 to March 2020 due to the risk of short circuit possibly caused by
faulty manufacturing of its high-voltage battery cells.

 

Recalled Kona EVs in South Korea get software updates and some receive
battery replacements after inspection.

 

The recalled Kona that caught fire had only received a software update but
no battery replacement, the official said on condition of anonymity as he is
not allowed to speak to media.

 

Korea Automobile Testing & Research Institute, which has been investigating
the fires, is now looking into the adequacy of Hyundai’s voluntary recall
process, the official and an institute official said.

 

Hyundai did not have an immediate comment.

 

Hyundai is expected to launch a new electric vehicle, the Ioniq 5 - its
first model using a new EV-only platform - next month.

 

 

 

Nissan flips the switch on electric reboot in China

BEIJING (Reuters) - Nissan Motor is accelerating the rollout of electric
vehicles in China under its main brand and its local, no-frills Venucia
marque as it overhauls its strategy in the world’s biggest auto market, four
sources told Reuters.

 

 

Besides the focus on green vehicles, the plan involves using more locally
made parts and technologies to reduce costs and help the struggling Japanese
carmaker compete better with lower-cost Chinese firms and major global
rivals, the sources said.

 

The China strategy is a key pillar of Nissan’s turnaround, which involves
focusing on producing profitable cars for China, Japan and the United
States, rather than chasing all-out global growth as it did under disgraced
former boss Carlos Ghosn.

 

“Before we were saying global, global, global, and China was just part of
that strategy,” one of the four people familiar with the plans told Reuters.

 

“With regionalisation now replacing globalisation, we have to improve the
cost competitiveness of all the components and technologies that go into a
car by going totally local,” he said.

 

Both the Nissan board and the board of its China joint venture Dongfeng
Motor Company have backed the plan and some elements of the new strategy
will be unveiled at the Shanghai auto show in April, the sources said.

 

Nissan plans to launch three cars in China this year: the new all-electric
Ariya crossover, a significant redesign of its X-Trail sport utility vehicle
(SUV) and a hybrid Sylphy compact car using its e-Power technology, the
sources said.

 

At least one new Nissan car will hit the Chinese market each year through
2025, with most either fully electric or hybrids equipped with autonomous
and smart driving technology, the sources said. One is likely to be an
e-Power X-Trail.

 

Two of the sources said the plan also involves turning Venucia more into a
brand for affordable electric vehicles (EVs), though details are still being
worked out. The idea is to price new Venucia EVs well below its current
cheapest EV - the e30 mini car - which starts at 61,800 yuan ($9,540).

 

All four sources work for Nissan and spoke on condition of anonymity because
they are not authorised to speak to reporters.

 

Nissan declined to comment on its future product strategy.

 

“China is a core market for Nissan and Nissan is getting prepared to launch
a slew of technologies including e-Power technology to fulfil customers’
aspirations,” a Nissan spokesman said. He also confirmed the Ariya would be
launched in 2021.

 

‘CHINA-SPECIFIC CARS’

 

Despite being one of the world’s first automakers to fully embrace fully
electric cars with its best-selling Leaf, Nissan has fallen behind Toyota
and Honda, analysts said. Both launched a slew of new hybrids in China in
2019 and 2020 which has helped boost their sales.

 

“Nissan has nothing to show off in terms of green cars in China today,” said
Yale Zhang, head of consultancy Automotive Foresight in Shanghai. “That’s
hurting their image and, most importantly, sales.”

 

 

Nissan’s new China strategy is also a response to growing competition from
price-competitive Chinese automakers such as Geely Automobile, GAC Motor,
and BYD, two of the sources said.

 

One of the sources said a new focus on “China-specific” cars designed to
appeal to local tastes underpinned Nissan’s more decisive turn towards
electrified models. That should mean bolder grilles, sharp-looking headlamps
and tail lights as well as richer, softer and more sumptuous vehicle
interiors.

 

Many local brands are now producing better-quality cars and that’s putting
pressure on Nissan’s mainstream cars, as well as vehicles produced by other
global automakers.

 

The most critical part of Nissan’s China-specific strategy, however, is to
make cars with more parts and technologies procured within the country to
slash costs.

 

After posting its first loss in 11 years, Nissan is scrambling to slash its
production capacity and models by about a fifth and to cut fixed costs by
300 billion yen ($2.9 billion) over three years.

 

Nissan expects to post a record operating loss of 340 billion yen in the
year ending March 31.

 

Two of the sources said there wasn’t necessarily a cost-cutting target for
the China initiative.

 

However, Nissan is worried about the potential hit to profitability from
increasingly stringent emissions and fuel-economy rules, as well as a likely
rise in the cost of materials such as steel, other metals and
semiconductors, they said.

 

GREEN-CAR CREDITS

Under the new China plan, parts engineered and procured locally should go
well beyond bumpers, seats and lamps to include more complex technologies
such as sensors and electric power inverters, three of the sources said.

 

Batteries for Nissan’s e-Power models, for example, will be locally
developed and sourced from China’s Sunwoda Electric Vehicle Battery Co.

 

Nissan’s new plan is modest in terms of volume growth. It is simply aiming
to outpace the overall Chinese market for cars and light commercial
vehicles, which Nissan expects to grow by about 10% to 25 million vehicles
by 2025, one source said.

 

Nissan’s previous “Triple One” China plan aimed to boost annual sales to 2.6
million cars by 2022 but the COVID-19 pandemic derailed it. Nissan sold 1.46
million cars last year, down from 1.56 million in 2018 when that plan was
unveiled.

 

While Nissan’s performance in China last year was broadly in line with an
overall 6% decline in passenger car sales due to the coronavirus, its
Venucia brand fared particularly badly.

 

Established in 2012 to compete with local brands making cheap,
gasoline-fueled cars, Venucia’s sales peaked in 2017 at 143,206 before
sliding to 79,000 last year. The plan is to relaunch Venucia more as a brand
for affordable EVs though it won’t be going fully electric for now, two
sources said.

 

Carmakers in China need to make enough so-called New Energy Vehicles to win
green-car credits which then offset negative points from their production of
combustion engine vehicles.

 

Nissan looks set to fall short of credits so it would either have to buy
them from rivals, or step up its EV production. As buying credits would eat
into profitability, it is favouring the second strategy, one of the sources
said.

 

Cheaper EVs made locally by global rivals such as General Motors through
joint ventures have also proved to be a success story with customers,
especially in big cities.

 

Launched in July, GM’s tiny Wuling MINI EV has already become China’s best
selling electric vehicle, knocking Tesla’s Model 3 sedan off its perch.

 

“We don’t have enough electric cars in China. The new plan for Venucia is
all about changing that more decisively,” said one of the sources familiar
with Nissan’s plans.

 

($1 = 6.4767 Chinese yuan renminbi)

 

($1 = 103.8300 yen)

 

 

 

Oil drops as U.S. stimulus wrangles, rising COVID-19 cases hit sentiment

TOKYO (Reuters) - Oil prices fell on Tuesday as fading hopes for a rapid
approval of new U.S. economic stimulus and mounting new coronavirus cases
raised questions over the pace of any recovery in demand.

 

Brent crude was down 28 cents, or 0.5%, at $55.60 by 0431 GMT, while U.S.
crude fell 25 cents, or 0.5%, to $52.52. Both rose nearly 1% on Monday.

 

Having recently hit 11-month highs, oil is caught between lingering doubts
over any recovery in demand as the pandemic continues to rage, offset by
optimism for more stimulus from the newly installed Biden administration in
the United States to support economic growth as vaccines are rolled out.

 

But Biden administration officials are still trying to convince Republican
lawmakers of the need for more stimulus, raising questions over when it will
be approved.

 

“The negative sentiment sweeping Asia today, as the reality of U.S. stimulus
politics dawns, has seen both contracts move lower,” said Jeffrey Halley,
senior market analyst at OANDA.

 

Even as the pace of new infections falls in the United States, European
nations have set tough restrictions to combat the spread of the virus, while
China is reporting rising new COVID-19 cases, casting a pall over demand
prospects in the world’s largest energy consumer.

 

Still, there are areas where demand for oil remains strong.

 

In India, crude oil imports in December rose to their highest in more than
two years as the easing of coronavirus restrictions boosted economic
activity.

 

On the supply side, the Organization of the Petroleum Exporting Countries
and its allies’ compliance with pledged oil output curbs is averaging 85% in
January, tanker tracker Petro-Logistics said on Monday. The findings suggest
the group has improved compliance supply curb commitments.

 

Also, output from the giant Tengiz field in Kazakhstan was disrupted by a
power cut on Jan. 17.

 

“Through 2021, major supply and demand risks remain that threaten to jolt
fundamentals into a much tighter or looser market,” Citigroup said in a
note.

 

The bank cited the risk of higher supply if sanctions on Iranian crude are
lifted, or U.S. drillers boost output from shale, against a bigger demand
shock from the latest wave of lockdowns and restrictions.

 

 

 

Investor payouts and job cuts jar with U.S. companies' social pledge

(Reuters) - When Randall Stephenson joined 180 of his peers leading many of
the richest U.S. companies in signing the Business Roundtable pledge on the
“purpose of a corporation” in August 2019, the then-chief of AT&T Inc
promised to look out for the interests of all the wireless carrier’s
stakeholders, not just shareholders.

 

Two months later, the Dallas-based company outlined a plan for cost
reductions that also prioritized dividends and stock buybacks for
shareholders, succumbing to pressure from $41 billion hedge fund Elliott
Investment Management LP.

 

Activist investor Elliott had said its proposals would deliver “substantial
benefits” for shareholders, consumers and employees, but not everybody came
out ahead.

 

By the end of September 2020, AT&T had eliminated 23,000 positions, or about
9% of its workforce, many of them during the pandemic. Already one of the
corporate world’s top dividend payers with $14.9 billion spent in 2019, AT&T
had raised its common dividend by 2% and bought back $7.5 billion of its
stock.

 

“We are the face of AT&T and we go out of our way to help customers
communicate with their families,” said Darren Miller, a 35-year-old
technician whose job was cut last July. “But we are a dime a dozen to them.
If they can get someone cheaper to do the job, they will do it.”

 

Miller, who worked in Reseda, California, said he accepted a buyout offer
after managers told him he might be laid off later on less generous terms,
something he said his local union representatives told him happened to
dozens of other employees in the state.

 

AT&T spokesman Jim Kimberly said most of the workforce reductions “were from
voluntary departure offers and attrition” and declined to comment on
individual cases. He added the company had for years practiced a “meaningful
commitment to all stakeholders” through programs that include worker
retraining and environmental and social justice efforts. AT&T also ended
share buybacks once the pandemic hit, and has not increased its dividend
since, Kimberly said.

 

Elliott declined to comment.

 

Some advocates of a socially-minded stakeholder capitalism say AT&T’s case
is representative of the hurdles they face in challenging the leverage
investors have over U.S. companies.

 

The voluntary governance pledge signed by the CEOs didn't spell out specific
actions, but had the stated aim of moving away from "shareholder primacy".
here

 

Yet while signatories subsequently reduced payouts to shareholders as
companies put away cash to shield themselves from the financial fallout of
the COVID-19 pandemic, they still give a greater share to investors than
those companies that did not sign the pledge, according to a Reuters
analysis of data compiled by financial information provider Refinitiv.

 

The analysis found that the 171 publicly traded companies that signed the
pledge returned a median 60% of net income to shareholders during the first
three quarters of 2020 through dividends and buybacks, versus a 50% return
among the 355 S&P 500 firms that did not sign the statement.

 

By comparison, in the first three quarters of 2019, the signatories returned
a median 73% of net income to shareholders versus a 68% return among the
firms that did not sign the pledge, the analysis found.

 

Tim Gaumer, Refinitiv’s director of fundamental research, said pledge
signatories returned more to investors because they had the ability to do
so. “It is easier to pay out dividends and buybacks with confidence if your
income stream is less volatile,” he added.

 

Business Roundtable spokeswoman Jessica Boulanger said the analysis didn’t
account for how companies spent money they did not return to shareholders,
nor for “industry differences, company size and longevity and trends in
shareholder returns over time.” She added that signatories had upheld their
commitment to work for all stakeholders.

 

 

The CEOs signed the pledge without legally binding their companies and
largely without approval from their boards. COVID-19 stress-tested their
commitments, as large swathes of the economy were forced to shut down.

 

The pledge’s lack of detail gave signatories wide discretion in deciding how
the pandemic pain would be spread among shareholders, employees and other
stakeholders.

 

“It’s a political signaling exercise that doesn’t mean very much,” said
Harvard Law School professor Jesse Fried, who is on the research advisory
council of Glass, Lewis & Co which advises investors over how to vote on
corporate governance.

 

Defenders of the Business Roundtable pledge say many contributions to
society cannot be measured as easily as shareholder spending or layoffs. For
example, JP Morgan Chase & Co pledged $30 billion to address racial
injustices, and Apple Inc launched a $100 million diversity drive.

 

Indeed, some signatories have won praise from progressive-leaning
organizations for standing by employees during the pandemic.

 

Among them, Target Corp raised its minimum wage to $15 an hour in July from
$13, which was already well above the $7.25 national level.

 

Some executives and investors argue that unless companies are attractive to
shareholders and keep their stock highly valued, they won’t have the money
to invest in their businesses for the benefit of all stakeholders.

 

“If you don’t have access to capital, then you’re not going to be around
long enough to face tough societal issues like climate change,” said Todd
Ahlsten, chief investment officer for Parnassus Investments, a San
Francisco-based firm with $40 billion under management.

 

EMPLOYEE REPRESENTATION

Less than two years after the signing of the pledge, key protagonists at
AT&T moved on. Stephenson passed the reins to a successor, and Elliott sold
what was once a $3.2 billion stake in the company.

 

AT&T’s layoffs during the pandemic attracted the attention of Democratic
senators Elizabeth Warren and Bernie Sanders, who wrote to the company last
July objecting to “corporations using the pandemic as justification for
continuing to make anti-worker decisions that are aimed at boosting share
price.”

 

“The long-term interests of our communities and employees cannot be met
without attracting investor capital,” AT&T executive vice president Timothy
McKone responded in a letter.

 

BlackRock Inc and Vanguard Group Inc, whose CEOs also signed up to the
pledge, were among the AT&T investors who voted down a proposal last April
to have an employee representative on the company’s board - a step its
advocates argued would give stakeholders a voice. Both fund managers
declined to comment.

 

SPENDING ON SHAREHOLDERS

Wharton School of the University of Pennsylvania researchers found that
among signatories, the bigger share of profits companies subsequently
returned to investors, the more likely they were to announce layoffs and
furloughs.

 

A study from the London School of Economics and Columbia University found
signatories violated environmental and labor-related rules and paid their
CEOs more than similarly-sized peers.

 

Like AT&T, some companies that signed up continued payouts to shareholders
even as they cut jobs during the pandemic.

 

Cisco Systems Inc bought back $800 million of its shares during the three
months ended Oct. 24, 2020. The network equipment maker had announced a
restructuring plan in August to cut $1 billion in costs annually, with the
loss of about 3,500 jobs.

 

“Cisco believes in the Business Roundtable pledge balancing the needs of all
of our stakeholders and fulfilling our own company’s purpose of powering a
more inclusive future for all,” the company said in a statement.

 

Walgreens Boots Alliance Inc repurchased $522 million of its shares from
April through July. That month, the pharmacy operator cut 4,000 jobs, some
7% of its headcount, bumped up its dividend and nixed its stock buyback
program.

 

Walgreens did not respond to a request for comment.

 

The chairman of the Business Roundtable, Walmart Inc CEO Doug McMillon,
downplayed the significance of the pledge in remarks to investors last
February. He said “it didn’t feel like news” because companies sought to
balance the interests of all stakeholders anyway, and that “of course, our
shareholders are our priority.”

 

Walmart declined to make McMillon available for an interview. A company
spokeswoman pointed to McMillon’s previous comments on multi-stakeholder
capitalism being “the answer to addressing our challenges holistically.”

 

 

 

Asian stocks weaken on stimulus worries, dollar holds firm

NEW YORK/SINGAPORE (Reuters) - Asian stocks dipped on Tuesday, retreating
from record highs as lingering concerns about potential roadblocks to the
Biden administration’s $1.9 trillion stimulus weighed on sentiment, dragging
U.S. Treasury yields to three-weeks lows.

 

 

The lower risk appetite lent some support to the dollar against a basket of
currencies, while oil prices edged down.

 

In a sea of red seen across Asian markets, South Korea and Hong Kong topped
losers and fell 1.7% each, Japan slipped 0.6% and Chinese stocks shed 1.5%.
All have touched milestone highs this month.

 

MSCI’s broadest index of Asia-Pacific shares outside Japan dipped 0.7% to
722.7 but was not far off from a record high struck on Monday and is still
up 9% so far this year.

 

Australian stock markets were closed for a national public holiday.

 

E-mini futures for the S&P 500 slipped 0.26%.

 

All eyes were on Washington as U.S. lawmakers agreed that getting COVID-19
vaccines to Americans should be a priority even as they locked horns over
the size of the pandemic relief package.

 

“The immediate question now is when stimulus aid will be approved and how
much?” said Christopher Grisanti, chief equity strategist at MAI Capital
Management.

 

Financial markets have been eyeing a massive package, though disagreements
have meant months of indecision in a country suffering more than 175,000
COVID-19 cases a day with millions out of work.

 

Fourth-quarter gross domestic product data for the United States, Germany
and France due out this week may cool sentiment.

 

Overnight, the Nasdaq index scaled a new peak and added 0.7% on hopes of
strong earnings later this week from technology titans, but the Dow Jones
Industrial Average index struggled to keep pace and fell 0.12%. [.N]

 

European shares closed at two-week lows as a slump in German business morale
underscored the damage from tighter COVID-19 restrictions. [.EU]

 

U.S. policymakers are expected to keep the monetary spigot open when the
Federal Reserve’s Federal Open Market Committee meets on Tuesday and
Wednesday.

 

“We expect the January FOMC to repeat and reinforce the Fed’s existing
dovishness, which is still significant given the recent taper discussions
and other central banks’ considerations to adapt policy,” Ebrahim Rahbari,
FX strategist at CitiFX, said in a report.

 

“Dovish Fed policy is a key driver for our view of upside in risk assets and
bearish USD view. We therefore continue to watch Fed-speak and potential
policy changes closely,” he said.

 

The dollar advanced to a near one-week high against a basket of currencies,
as volatility in stock markets around the globe sapped investors’ appetite
for riskier currencies.

 

The euro slipped slightly overnight to $1.2142 and held around those levels
in Asia trade.

 

Benchmark 10-year U.S. Treasury yields held where they left off in New York
at 1.0414%, having hit a three-week low of 1.0300% overnight. [US/]

 

Brent crude fell 0.2% to $55.75, having risen nearly 1% on Monday. 

 

 

 

Liberia's Banknote Shortage Undermines George Weah's Pro-Poor Presidency

Liberia's economy is stagnating under the impact of Covid-19. A contraction
in growth and a banknote shortage have combined to undermine President
George Weah's "pro-poor" agenda as he marks his third year in office.

 

"The government is frustrating us day-by-day," says Victoria Kamara, a
customer of SIB Liberia bank on Broad Street in Monrovia, waiting for a
fifth day in a row to try to withdraw money from her account. "We're tired
in Liberia, people are tired, maybe they want us to go and steal," she adds.

 

Queues outside banks in the capital are commonplace as a banknote shortage
forces commercial banks to restrict cash withdrawals.

Kamara, waiting patiently under an awning in a line snaking towards the
bank's locked doors, describes how tellers refuse the withdrawal requested,
suggesting a lower amount.

 

"We've come to get our salary," says Ambroise Jahwley, another customer.
"Each time we come they say no US [dollars], no LD [Liberian dollars].
Sometimes they give you half of your money, sometimes 50 dollars, sometimes
40 dollars.

 

"I'm very disappointed in the government and the bank because we're not
getting what we're supposed to."

 

Severe shortages

 

Weah presides over a country of 4.8 million people with a predominantly
cash-based economy. Banknote shortages hit consumers' pockets.

 

Banks in Liberia commonly manage the supplies of cash in their vaults,
especially ahead of heightened demand from customers at holiday periods.

Most banks will start to taper withdrawals and hold more deposits during
summer to meet those demands, an executive from a pan-African bank told RFI
in a briefing, without wanting to be named.

 

But this year is more severe and shortages of cash have continued. The banks
are reliant on their supply from the central bank. For cash held in their
vaults, they must slow loan-making activity to maintain some withdrawals for
customers.

 

"Two seasons of the year - our independence (26 July) and Christmas - cause
a big rush on banks," says Dixon Seboe, a representative for Weah's ruling
Coalition for Democratic Change (CDC) party.

 

"But this situation shows that it has become more profound," says Seboe, who
chairs the house committee on banking and currency. "It did not just happen
at Christmas, it started about three or four months ago."

The US embassy in Monrovia put out an alert in December, warning travellers
not to rely on getting cash from banks in Liberia, but to bring sufficient
money when coming to the country.

 

Impacting economy

 

Traders at Monrovia's markets report lower sales and customers with no cash
to spend, affecting demand for their products.

 

Isaac Doe, a clothes seller, does not directly blame Weah's administration.
"We are experiencing challenges in business, but I don't want to say it
could have some political or socio-economic motives," the 28-year-old says.

 

Few customers mingle amongst the aisles of mannequins displaying outfits at
the China market building where Doe works.

 

Vendors sell dresses and skirts in stalls, and seamstresses sit at sewing
machines whirring away on the ground floor, altering clothes.

 

"We have mutilated money cycling in the entire economy right now," says Doe,
describing damaged and dirty banknotes, and problems trying to give
customers change. "When you get to the bank, the bank is telling you, 'We
don't have money.'"

 

Cynthia Lloyd, a trader in provisions, complains that part of the problem is
that foreign aid organisations left the country, reducing overall demand.

 

Africa Calling podcast: Ep 14: Midterm review for Liberia's President George
Weah

 

"Those people are gone, out of Liberia, so we're fighting all by ourselves,"
Lloyd says, sitting at her stall on Mechlin Street in downtown Monrovia,
selling eggs, milk, flour and sugar.

 

The UN mission in Liberia (UNMIL) left the country in March 2018, after
helping the country recover from two civil wars and uphold a 2003 peace
agreement.

 

The withdrawal of international staff certainly would have had an impact on
the multiplier effect in the economy with less foreign currency being spent.
But for trader Lloyd, a Weah supporter, money problems also tie into the
shortages of cash.

 

"We've got a shortage of banknotes, because of the ratty money on the
market. Some of the money isn't good," says Lloyd.

 

Are the banknotes really missing?

 

The banknote shortage traces its roots back to the apparent scandal emerging
after Weah took office, with about $100m of new Liberian banknotes allegedly
going missing.

 

Banknotes were printed by a Swedish company with the approval of former
President Ellen Johnson Sirleaf's administration. After Weah assumed office,
reports emerged claiming large amounts of banknotes had gone missing after
being shipped to Monrovia.

 

The government ordered an investigation by US consultancy firm Kroll
Associates who carried out a forensic audit, concluding no banknotes were
missing, but highlighting a series of inadequate controls at the central
bank.

 

President Weah set up a special taskforce to handle the matter and the
Liberian prosecutor charged Charles Sirleaf, Ellen Johnson Sirleaf's son, a
former central bank official, as well as four others, with money laundering.

 

Sirleaf was freed, but former Central Bank Governor Milton Weeks was found
guilty of being unauthorised to print the banknotes. The questions centred
around whether authorisation for printing money had been granted by the
legislature.

 

Responsibility

 

Nevertheless, the criminal charges against Weeks were dropped and he was set
free. The missing banknote saga was solved, according to the authorities.

 

The legal proceedings were seen as somewhat of a witch-hunt by some of those
made publicly responsible for the affair.

 

"I don't know what I've done to him, but I know he's a complete idiot," says
David Fahart, a former finance minister who sat on the central bank's board,
referring to the prosecutor.

 

"You've got people in government who don't know their left from their
right," he adds, describing how members of the central bank board were
unjustifiably accused, and had nothing to do with authorisation to print
banknotes. "I was indicted, made the man who was responsible."

 

The Kroll report and court case concluded the affair, and as far as the
government was concerned, no money was missing.

 

The affair did highlight chaotic checks and balances at the central bank,
and some questions remain unanswered.

 

Further details on the so-called mop-up exercise, using US$20 million to buy
Liberian dollars and put US dollars into circulation, are sparse. Some
189,000 dollars went unaccounted for, the Kroll report said.

 

The US government announced further technical assistance to the Liberian
government in December 2019, hiring Kroll Associates to help the central
bank "more effectively perform its core functions of managing the Liberian
currency".

 

Kroll's goal would be helping the central bank "manage compliance" and
"mitigate risks", enhancing "institutional capability and internal controls
relating to currency printing and management", said a statement about the
USAID-funded assistance.

 

Lack of faith in the banking system

 

The "16 billion saga", as some Liberians refer to it, appears to be more
about banknote supply, the quality of those "mutilated" denominations, the
hoarding of cash and a mistrust in the banking system.

 

The life cycle of a typical good quality banknote is five years at best, but
can be less in challenging tropical environments like Liberia, where the use
of cash is high. Banking staff describe stacks of banknotes in vaults
needing dehumidifiers to stop the bills from becoming mouldy.

 

The management of replacing damaged, dirty and overused banknotes was found
lacking, the original "missing" cash was supposed to be part of that cyclic
changeover of money circulating through the system.

 

The shortage of banknotes currently is not about a curious or suspicious
link to the past missing banknotes saga, according to Liberia's finance
minister.

 

"Unfortunately, this excessive politicisation has affected monetary policy
in such a way that money comes out of the banking sector and doesn't go back
in," says Minister Samuel Tweah.

 

"I think the government wants to replace the entire stock of money and hit a
monetary reset button," Tweah added, explaining that Liberia's legislature
must discuss authorising the printing of more banknotes.

 

"There were no missing banknotes, and sometimes when people say, 'We can't
find money in the bank,' there is a connotation that then it's missing. It's
actually not missing," says Tweah. "The money that is out is owned by the
users, the owners, Liberians who own the money."

 

Economy shrinks

 

More broadly, Liberia's economy was hit by the Covid-19 pandemic in 2020,
with lockdown measures to control the spread of the virus bringing Monrovia
to a standstill.

 

The economy contracted by 3 percent in 2020 with the coronavirus impact,
according to a December 2020 review by the International Monetary Fund.

 

If the global economy rebounds, Liberia's growth would be expected to reach
3.2 percent, although the IMF notes high "downside risks" to the outlook,
with the country "fragile and vulnerable to shocks".

 

"There has been a slight retrogression and in some places stagnation of
growth," says George Wisner, former head of the National Investment
Commission under Sirleaf.

 

"We were already recovering from external shocks caused by the Ebola
epidemic," he says.

 

"On top of that we had the commodity price shock, because we trade in
primary commodities, and then we also had the uncertainties around the
United Nations peacekeepers withdrawal," added Wisner, who teaches
international development at the African Methodist Episcopal University.

 

Liberia's top three exports are iron ore, gold and rubber, according to data
from the International Trade Centre.

 

Tyre manufacturer Firestone announced redundancies for their long-standing
Liberia operations - shedding 800 jobs in 2019, and as many in 2020.

 

Gold mining operations have been buoyed by the recent strength in the gold
price, likewise iron ore has held strong prices over the past year.

 

Arcelor Mittal has a 25-year concession in Liberia and royalties paid to the
government topped $22m in 2019. The steel maker takes advantage of rights
for a railroad it developed to Buchanan port for exporting iron ore.

 

Discussions are underway between Arcelor Mittal and the government over
additional use of the infrastructure to obtain and bring to port raw
materials from another operator in neighbouring Guinea.

 

Arcelor Mittal also has a phase two expansion project on the cards,
previously delayed by Ebola. This would increase production, and a
feasibility study has already been carried out.

 

Banknotes drag on economy

 

Regardless of foreign investment in Liberia's commodity trade, the main
obstacle hampering the economy at the moment is a lack of banknotes, as
witnessed on the streets of Monrovia.

 

"It's a serious challenge that the government has been concerned about for
the past two years," says Finance Minister Tweah. "There's been a lot of
monetary challenges around money in Liberia."

 

Fahart, previously on the board of the central bank when it last tried to
print banknotes for circulation, agrees, the authorities must print some
banknotes and boost confidence in the system.

 

"The problem lingers on now, at the point before I left, there was hardly
any money in the bank," he says. "People are nervous - so in that period of
uncertainty people hold onto their cash, they keep it in their vaults or
whatever - and then the money, it was mutilated."

 

 

 

Kenya: CS Amina for Eldoret as New Contractor Picked for Kip Keino Stadium

There seems to be light at the end of the tunnel after a new contractor
launched operations at the Kipchoge Keino Stadium in Eldoret Monday.

 

And on Tuesday, Sports, Culture and Heritage Cabinet Secretary Amina Mohamed
is expected in Eldoret to follow up on the renovations.

 

Golbo Contractors have been tasked with building the Northern and the
Southern wings which will conclude work on the terraces meant to accommodate
a capacity of 30,000 people.

 

According to the site engineer Geoffrey Kinyua, they have been tasked to
build the remaining terraces and level the grounds before completing the
project with the parking area.

"We are one month old here at the site and I'm happy with the progress so
far because we are racing against time so that we can finish what was on the
contract. The project consists of construction of the remaining terraces,
drainage, roofing and the parking lot," Kinyua explained.

 

He also revealed that they are targeting to complete the works by mid-May or
early June and hand over the project, if the cash flow will be steady.

 

"We have applied for the first certificate and we hope the flow of cash will
be steady because we want to finish the project by June so that we can hand
over to the government," added Kinyua.

 

The contractor has been slowed down by the lack of water and is forced to
buy 22,000 litres daily despite the stadium having a borehole which is
supposed to supply water.

Lack of electricity is another concern

 

"Early this month, we applied for electricity and we haven't received any
communication from the Kenya Power Company and that has really slowed us
because we can't do anything without power.

 

"We also have a challenge with water and we are forced to buy more 22,000
litres daily for our daily use. If the authorities aid us in getting the
two, we can be able to move faster," Kinyua said.

 

Shiv Construction Company, which is tasked with building and completion of
the VIP terraces, is setting base for the first floor after a long break for
what insiders say was due to lack of funds.

 

The Eldoret facility stalled in 2017 immediately after the Sports Kenya and
the County Government of Uasin Gishu signed an agreement to renovate the
stadium with works set to cover the VIP terraces, changing rooms, a
conference hall, indoor games hall and terraces for between 15,000 to 25,000
spectators.

Sh230 million shillings was the initial amount released from the national
government. while the county government of Uasin Gishu was to pump in Sh100
million shillings to handle the parking lot and lighting.

 

The works was later divided into four after the initial contractor WIETEC
Company was handed over the eastern wing and began their portion when they
were paid eight percent of an initial 20 per cent deposit. They completed
their portion in 2019 and vacated the place.

 

The current budget for the facility, according to the Ministry of Sports is
Sh653,590,545 which is expected to be sufficient to complete the project.

 

In her last tour to the facility last year, Cabinet Secretary Amina told
journalists that they had entered into a memorandum of understanding with
the contractor to complete the works on the stalled VIP pavilion at the
stadium which was to be completed in December but that was not to be.

 

Athletics Kenya is expected to use the facility in June to hold the Olympics
Games trials ahead of the June 23 to August 8 Games in Tokyo.

 

According to AK President Jack Tuwei, the calendar will not change and they
hope by then the facility will be ready for use.

 

"Last year we had planned to use the facility but unfortunately the Games
were postponed. This year we are looking forward to selecting a team that
will represent Kenya in the Games which will be in July and August and we
hope to use Kipchoge Keino Stadium," said Tuwei.-Nation.

 

 

 

Namibia: Diamond Sales Back With a Bang

DIAMONDS are indeed in the rough.

 

After the global diamond trade plunged close to rock bottom last year due to
Covid-19, reports are now that at last, business is booming again.

 

Namibia is an active player in the industry and this is good news for the
country.

 

According to a Bloomberg report, factories in the industry's "engine room" -
the Indian city of Surat - are so desperate to boost production that the
most-skilled cutters and polishers are being headhunted with offers of
lucrative salaries and perks like free food and housing.

Miner De Beers is poised for its biggest rough-diamond sales in three years,
even after raising prices, and rival Alrosa PJSC said this week it expects
the recovery to keep going up for some time.

 

It is reported that this sales boom is being driven by bumper holiday
jewellery sales, particularly in the vital United States and Chinese
markets.

 

For years, diamonds faced stiff competition from travel as a form of luxury
spending. Now, with vacations on hold due to lockdowns and other
restrictions, consumers are putting their disposable income into online
purchases.

 

The sales boost is feeding through to surging demand for polished diamonds,
at a time when stocks held by factories and traders had shrunk dramatically
following the initial Covid-19 lockdowns.

 

But for an industry long familiar with dramatic booms and busts, it is
unclear whether the rebound will take hold, or represents only a temporary
respite. Some industry participants are also concerned that the market is
running too hot, risking a slump later in the year.

Annual diamond jewellery demand had been stagnant at about US$80 billion for
the past five years and the sector's middlemen were struggling to turn a
profit.

 

As global vaccines roll out and other luxury purchases become viable again,
there's a risk that the industry finds itself facing the same old challenges
as before.

 

For now, money is pouring in.

 

Signet Jewellers Ltd reported a 7,8% jump in holiday sales in North America,
by far the industry's biggest market.

 

India, where about 90% of diamonds are cut or polished, imported almost US$2
billion in rough diamonds last month as cutters and polishers raced to meet
the increased demand and restock their inventories.

 

De Beers and Alrosa have both responded by raising prices, seeking to
recover some of the ground they lost last year when demand collapsed.

But while De Beers implemented an increase of about 5% in its first sale of
the year last week, customers are still buying. The sale has not yet been
finalised, but the miner was on course for its biggest rough-diamond auction
in three years - at about US$600 million - according to people familiar with
the situation.

 

Still, the first sales of the year are traditionally the busiest, when the
industry's middlemen rush to restock. If sales slow later in the year,
prices could come under pressure again.

 

"There's a dilemma for the miners. If they choose not to sell, they lose out
on monetising stock, but if they sell too much they risk saturating the
market," said Anish Aggarwal, a partner at specialist diamond advisory firm
Gemdax.

 

At the moment, the middlemen who cut, polish and trade the world's diamonds
are making a killing.

 

In the so-called secondary market - where buyers sell to gem manufacturers
who don't have direct access to De Beers or Alrosa - boxes have been
changing hands at premiums above 5%, and some in double digits, even after
the price rise.

 

That suggests manufacturers believe they can make a profit at current
prices.

 

Rough diamond prices generally have recovered back to pre-pandemic levels,
while polished prices are slightly higher. That's good news for mostly small
and private family-run businesses that cut, polish and trade the
stones.-Namibian.

 

 

 

South Africa: Western Cape Finance and Economic Opportunities On Tourism
Sector Under Level 3

Data from the tourism industry in December unsurprisingly reflects a sector
that has been hammered by the Covid-19 pandemic and the related lockdown
restrictions with almost all the top attractions in the Western Cape
reflecting a more than 60% drop in visitors over the peak tourism season.

 

This data confirms the desperate state of the tourism and hospitality
industry in the Western Cape, and considering the evidence that the Western
Cape is passed its peak and the demand on our health services is
stabilising, this reinforces the need to relax the Alert Level 3
restrictions that are negatively impacting the economy and resulting in,
almost daily, business closures and jobs losses.

Last year, we recognised the importance of a strong summer season for the
recovery of the tourism and hospitality industry that had been severely
impacted by the Covid-19 pandemic last year. And so, in the knowledge that
it was safe to do so, we worked hard to ensure that the Western Cape was
ready to safely welcome both international and domestic visitors, and that
the Western Cape was positioned as an attractive destination choice for
those looking for wide-open spaces and a variety of affordable and diverse
experiences.

 

However, we could not have anticipated the intensity of the second wave both
at home and abroad that resulted in stricter international travel
restrictions, route cancellations by airlines and the Alert Level 3
restrictions, all of which has had a severe impact on the tourism and
hospitality sector.

International arrivals were much lower than initially anticipated for the
traditional peak season.

 

Official ACSA passenger data shows that passenger recovery at the
international terminal of the Cape Town International Airport in December
2020 was a mere 19% of December 2019 volumes. Aircraft were operating at
only 51% of their passenger load factors (compared to 72% in December 2019).

 

This partially explains why the hotel industry, which is highly dependent on
international travellers, has still not recovered.

 

STR (2021), who provide market data on the hotel industry, reports hotel
occupancy levels in the Western Cape were at 32.7% in December 2020,
compared to 68.1% in December 2019. In Cape Town, 5-star hotel occupancy
levels were at 29% in December 2020, 4-star hotel accommodation at 34% and
3-star hotel occupancy at 31% occupancy. Similar results were reported for
the Garden Route and the Cape Winelands.

In terms of domestic travel, vehicle counts nationally indicate that there
was a reduction in the number of overland domestic travellers during the
season. Traffic volumes have decreased by up to 27% on South Africa's major
highways.

 

The same trend was seen at our airports. The domestic terminal at Cape Town
International Airport saw only 51% of the volume of travellers compared with
December 2019. On a more positive note, aircraft had average passenger load
factors of 72% which reiterates the importance of domestic travel in the
current climate.

 

With the announcement of hotspots and beach closures in December, coastal
towns saw immediate cancellations from domestic markets. A survey by
NightsBridge, conducted after the announcement of the Garden Route as a
hotspot, found that one-third of guesthouses on the Garden Route indicated
at least 50% of festive season cancellations. The same study reported that
12.7% of bookings in the Western Cape were cancelled.

 

These reports not only show the precarious situation of the tourism and
hospitality industry, but also the impact of the restrictions on the economy
in the Western Cape.

 

As we know from the most recent South Africa Tourism Survey (December 2020),
58% of tourism and hospitality businesses were unable to service their debts
and 61% of businesses were unable to cover fixed costs in October 2020. This
was before the Alert Level 3 restrictions were announced in December.

 

Any hope of a recovery over the festive season has been lost, however the
summer season is not yet over, and we still have an opportunity to ensure
the survival of businesses and jobs in the Western Cape if we can urgently
relax the restrictions, specifically for the curfew to start at 23:00, the
beaches to open and an easing of the alcohol ban.

 

And so, I will write to the Minister of Tourism, Mmamoloko Kubayi-Ngubane,
calling for the immediate easing of restriction in respect of the curfew,
the closure of beaches and the onsite consumption of liquor in restaurants
and similar establishments, as well as allowing the tasting and selling of
liquor at wineries and wine farms.

 

I have also written to the Minister of Employment and Labour, Thulas Nxesi,
to urgently extend the UIF Covid-19 TERS scheme for the duration of the
Alert Level 3 restrictions to assist businesses and employees who have been
impacted by the restrictions.

 

The Western Cape government has focused on getting the balance right between
preventing the spread of Covid-19 while keeping the economy as open as
possible, saving both lives and livelihoods.

 

And, we will continue to work hard to support businesses so that we can save
jobs and save the economy in the Western Cape.

 

 


 


 


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 

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www.bullszimbabwe.com/blog

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Skype:         Bulls.Bears 



 

 

 


 

INVESTORS DIARY 2021

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


ART

PPC

Dairibord

 


Starafrica

Fidelity

Turnall

 


Medtech

Zimre

Nampak Zimbabwe

 


 

 

 

 


 <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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