Major International Business Headlines Brief::: 22 March 2021

Mon Mar 22 09:25:27 CAT 2021

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Major International Business Headlines Brief::: 22 March 2021

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

ü  Asia stocks hesitant as bonds boosted by Turkish tumult

ü  Canadian Pacific to buy Kansas City Southern in $25 bln railway bet on
trade

ü  Shares of Japan's big three car makers dip after Renesas auto chip-plant
fire

ü  Wall Street's year of bust and boom

ü  Richmond Fed's Barkin: U.S. may be 'on the brink' of complete recovery

ü  U.S. House antitrust chairman plans multiple bills to go after Big Tech

ü  Oil falls as European lockdowns douse recovery hopes

ü  In India, Reliance Retail's private labels revolution spooks global
consumer goods makers

ü  Investors urge Europe to prioritise climate in agriculture reform'

ü  Australia's CBA and ANZ settle 2016 class action on alleged interest rate
rigging

ü  Nigeria's Rising Debts and Its Economic Impact

ü  African Countries Seek to Fill Yawning U.S.$92.8 Billion Finance Gap

ü  Nigeria Drops in UN-Backed World Happiness Ranking

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Asia stocks hesitant as bonds boosted by Turkish tumult

Asian stocks turned mixed and bonds bounced on Monday as a plunge in the
Turkish lira sparked talk that capital controls might be needed to stem the
rout, though the wider fallout was relatively restrained for the moment.

The dollar was trading almost 12% higher versus the lira at 8.0520, the
sharpest move since August 2018 when Turkish markets were in another of
their periodic crises.

The slide came after President Tayyip Erdogan shocked markets by replacing
Turkey's hawkish central bank governor with a critic of high interest rates.
read more

"The authorities will be left with two choices, either it pledges to use
interest rates to stabilise markets, or it imposes capital controls," said
Per Hammarlund, senior EM strategist at SEB Research.

"Given the increasingly authoritarian approach that President Erdogan has
taken, capital controls are looking like the most likely choice."

The uncertainty saw Japan's Nikkei (.N225) fall 1.6%, partly on speculation
Japanese retail investors could face losses on large long positions in the
high-yielding lira.

The ripples were more modest elsewhere with MSCI's broadest index of
Asia-Pacific shares outside Japan (.MIAPJ0000PUS) actually adding 0.3%,
aided by a 0.7% rise in Chinese blue chips (.CSI300).

EUROSTOXX 50 futures eased 0.3% and FTSE futures 0.2%. Nasdaq futures firmed
0.6%, while S&P 500 futures dithered either side of flat.

Yields on 10-year Treasury notes edged down five basis points to 1.68%,
suggesting some favoured safe havens.

Investors are still struggling to deal with the recent surge in U.S. bond
yields, which has left equity valuations for some sectors, particularly
tech, looking stretched.

Bonds had another wobble on Friday when the Federal Reserve decided not to
extend a capital concession for banks, which could lessen their demand for
Treasuries. read more

The damage was limited, however, by the Fed's promise to work on the rules
to prevent strains in the financial system.

A host of Fed officials speak this week, including three appearances by
Chair Jerome Powell, providing plenty of opportunity for more volatility in
markets.

WATCHING EMERGING MARKETS

Monday's tumble in the lira saw the yen firm modestly, with notable gains on
the euro and Australian dollar . That in turn dragged the euro down slightly
on the dollar to $1.1890 .

After an initial slip, the dollar soon steadied at 108.80 yen , while the
dollar index was down slightly at 91.973 .

Also supporting the yen were concerns Japanese retail investors that have
built long lira positions, a popular trade for the yield-hungry sector,
might be squeezed out and trigger another round of lira selling.

Still, analysts at Citi doubted that the episode would lead to widespread
pressure on emerging markets, noting the last time the lira slid in 2020,
there was little spillover.

"In terms of impact on other parts of the high-yielding EM, we believe that
will be quite limited," Citi said in a note.

There was scant sign of safe-haven demand for gold, which eased 0.2% to
$1,741 an ounce .

Oil prices fell anew, having shed almost 7% last week as concerns about
global demand prompted speculators to take profits on long positions after a
long bull run.

Brent was off 32 cents at $64.21 a barrel, while U.S. crude for May fell 33
cents to $61.10.

Canadian Pacific to buy Kansas City Southern in $25 bln railway bet on trade

Canadian Pacific Railway Ltd (CP.TO) agreed on Sunday to acquire Kansas City
Southern (KSU.N) in a $25 billion cash-and-stock deal to create the first
railway spanning the United States, Mexico and Canada, standing to benefit
from a pick-up in trade.

It would be the largest ever combination of North American railways by
transaction value. It comes amid a recovery in supply chains that were
disrupted by the COVID-19 pandemic, and follows the ratification of the
US-Mexico-Canada Agreement (USMCA) last year that removed the threat of
trade tensions that had escalated under former U.S. President Donald Trump.

"Think about what we've gone through, think about the importance in North
America of near-shoring that is occurring. This network uniquely provides a
supply chain that allows our customers and our partners to actually benefit
from that and leverage that opportunity," Canadian Pacific Chief Executive
Keith Creel told Reuters in an interview.

The combination needs the approval of the U.S. Surface Transportation Board
(STB). The companies expressed confidence this would happen by the middle of
2022, given that the deal would unite the smallest of the seven so-called
Class I railways in the United States, which meet in Kansas City and have no
overlap in their routes. The combined railway would still be smaller than
the remaining five Class I railways.

The STB updated its merger regulations in 2001 to introduce a requirement
that Class I railways have to show a deal is in the public interest. Yet it
provided an exemption to Kansas City Southern given its small size,
potentially limiting the scrutiny that its acquisition will be subjected to.

"I don't see it as the kind of consolidation that should raise concerns
because it's what you call an end-to-end or vertical merger. Their networks
fit nicely with each other and help fill out North America with real
service," said economist Clifford Winston, a senior fellow at the Brookings
Institution who specializes in the transportation sector.

An STB spokesman said the regulator had not yet received a filing from the
companies, which would start its formal review process. He declined to
comment further.

Still, Canadian Pacific agreed in its negotiations with Kansas City Southern
to bear most of the risk of the deal not going through. It will buy Kansas
City Southern shares and place them in an independent voting trust,
insulating the acquisition target from its control until the STB clears the
deal.

Were the STB to reject the combination, Canadian Pacific would have to sell
the shares of Kansas City Southern, and one source close to the agreement
suggested they could be divested to private equity firms or be relisted in
the stock market. Kansas City Southern shareholders would keep their
proceeds.

There is a $1 billion reverse breakup fee that Canadian Pacific would have
to pay Kansas City Southern if it cannot complete the formation of the
trust, the source added.

Shareholders of Kansas City Southern will receive 0.489 of a Canadian
Pacific share and $90 in cash for each Kansas City Southern common share
held, valuing Kansas City Southern at $275 per share, a 23% premium to
Friday's closing price, the companies said in a joint statement. Including
debt, the deal is valued at $29 billion.

Kansas City Southern shareholders are expected to own 25% of Canadian
Pacific's outstanding common shares, the companies said. Canadian Pacific
said it will issue 44.5 million shares and raise about $8.6 billion in debt
to fund the transaction.

It is the top M&A deal announced thus far in 2021. While it is the biggest
ever involving two rail companies, it ranks behind Berkshire Hathaway's
(BRKa.N) purchase of BNSF in 2010 for $26.4 billion. For a Factbox on the
deal highlights see: read more

Creel will continue to serve as CEO of the combined company, which will be
headquartered in Calgary, the companies said in a statement.

The companies also highlighted the environmental benefits of the deal,
saying the new single-line routes that would be created by the combination
will help shift trucks off crowded U.S. highways and cut emissions.

Rail is four times more fuel efficient than trucking, and one train can keep
more than 300 trucks off public roads and produce 75% less greenhouse gas
emissions, the companies said in the statement.

FAILED BIDS

Calgary-based Canadian Pacific is Canada's No. 2 railroad operator, behind
Canadian National Railway Co Ltd (CNR.TO), with a market value of $50.6
billion.

It owns and operates a transcontinental freight railway in Canada and the
United States. Grain haulage is the company's biggest revenue driver,
accounting for about 58% of bulk revenue and about 24% of total freight
revenue in 2020.

Kansas City Southern has domestic and international rail operations in North
America, focused on the north-south freight corridor connecting commercial
and industrial markets in the central United States with industrial cities
in Mexico.

Canadian Pacific's latest attempt to expand its U.S. business comes after it
abandoned a hostile $28.4 billion bid for Norfolk Southern Corp (NSC.N) in
April 2016. Canadian Pacific's merger negotiations with CSX Corp (CSX.O),
which owns a large network across the eastern United States, failed in 2014.

A bid by Canadian National Railway Co (CNR.TO), the country's biggest
railroad, to buy Warren Buffett-owned Burlington Northern Santa Fe was
blocked by U.S. antitrust authorities more than two decades ago.

A private equity consortium led by Blackstone Group Inc (BX.N) and Global
Infrastructure Partners (GIP) made an unsuccessful offer to acquire Kansas
City Southern last year. The sources said that bid helped revive Canadian
Pacific's interest in Kansas City.

BMO Capital Markets and Goldman Sachs & Co. LLC are serving as financial
advisors to Canadian Pacific, while BofA Securities and Morgan Stanley & Co.
LLC are serving as financial advisors to Kansas City Southern.

Shares of Japan's big three car makers dip after Renesas auto chip-plant
fire

Shares of Toyota Motor (7203.T), Nissan Motor (7201.T) and Honda Motor
(7267.T) fell on Monday following a fire at a Renesas Electronics (6723.T)
semiconductor plant that may aggravate a global shortage of automotive
chips.

The stock price of Japan's big three car makers fell more than 2% in early
trading compared with a smaller 1.4% dip in the benchmark Topix index
(.TOPX) on the Tokyo bourse.

Renesas said it will take at least a month to restart production on a 300mm
wafer line at its Naka plant in northeast Japan after a fire on Friday
caused by an electrical fault destroyed machinery and poured smoke into the
sensitive clean room. Two-thirds of production at the affected line is
automotive chips.

It said the impact on shipments to customers will begin in around a month.

The three car makers told Reuters that they are assessing what impact the
closure of the chip line will have on them.

Nissan and Honda had already been forced to scale back production plans
because of the chip shortage resulting from growing demand from consumer
electronic makers and an unexpected rebound in car sales from a slump during
the early months of the coronavirus pandemic.

Toyota, which ensured parts suppliers had enough stocks of chips, has fared
better so far. 

Wall Street's year of bust and boom

Wall Street giddyness in recent weeks stands in stark contrast to the
pandemic panic of one year ago.

U.S. stocks on Tuesday will mark the one-year anniversary of the market low
as the spread of the COVID-19 and government lockdowns began to crush
economic activity, before massive government and central bank stimulus plus
the development of vaccines fueled a stunning, if uneven, rebound.

As investor optimism grew, stocks began to recover from the selloff that
ended an 11-year bull market, history's longest.

The S&P 500 (.SPX) bottomed by closing at 2237.40 on March 23, and topped
the Feb. 19, 2020 bull-market high on Aug. 18, when the index ended the
session at 3389.78. That high marked the end of the shortest bear market
ever and confirmed that on March 23 a new bull had been unleashed.

Initial lockdowns hit customer-facing services sectors the hardest as social
distancing mandates to curb COVID's spread shuttered restaurants and slammed
the travel and leisure industry.

Jobs in these sectors - typically on the lower end of the wage scale -
evaporated overnight, and as new coronavirus infections spiked and abated,
those jobs have been slow to return.

Conversely, the shutdown caused consumer demand to shift from services to
goods, boosting resilience of U.S. factories and prompting a restoration of
manufacturing jobs that outpaced the whole.

Along with the stimulus supplied by the U.S. Federal Reserve and the
government, stocks worked their way off the low thanks in part to the start
of vaccine rollouts and optimism that economic reopenings were on the
horizon.

But companies that commanded attention during the beginning of the pandemic,
so called "stay-at-home" plays such as Amazon (AMZN.O), Zoom Media (ZM.O)
and Teladoc (TDOC.N) saw their fortunes begin to turn in the latter stages
of 2020, with cyclical sectors such as energy (.SPNY), materials (.SPLRCM)
and small cap stocks (.RUT) garnering more favor.

As optimism about reopenings began to rise, so did investor appetite for
stocks that traditionally do well as an economy recovers from a recession.
Many of those stocks fall into a "value" profile as they were largely
ignored for bigger "growth" names in sectors such as technology (.SPLRCT)
and communication services (.SPLRCL).

That change in tenor helped value stocks close what had been a widening gap
versus the outperformance of growth stocks over the past several years.

Uncertainty about the medium- or long-term recovery prognosis saw several
pivots between stay-at-home and reopening plays.

For instance, the equities market looked beyond grim current conditions and
toward an expected recovery in commercial air travel, which can be seen by
comparing air traffic data with airline stocks. Investors clearly see the
battered sector taking off despite persistently low passenger numbers
courtesy of the Transportation Safety Administration (TSA).

The housing market has been the star of the U.S. economic recovery,
rebounding beyond pre-pandemic levels as the hunt for lower population
density and home office space, along with historically low mortgage rates,
sent demand soaring, home prices surging and supply of homes on the market
to all-time lows.

Housing stocks have also handily outperformed the broader market since its
nadir. A year later, the Philadelphia SE Housing index (.HGX) is up nearly
150%, almost double the S&P 500's advance over the same time period.

The sector's strength is also a reminder of who suffered the worst of the
largest economic downturn since the Great Depression, as lower income
Americans typically rent and are less likely to be prospective home buyers.

Stocks also benefitted from what was referred to as "TINA," or "there is no
alternative" as the Fed's easy monetary policy kept Treasury bond yields
historically low, which also pushed home mortgate rates to their lowest
level ever. The yield on the benchmark 10-year U.S. Treasury note was less
than the dividend yield for the S&P 500 for some time.

But that has changed in recent weeks as expectations for a rapidly improving
economy have also raised inflation concerns, possibly denting the
attractiveness of equities should yields continue to rise.

The quick rise in rates over the past month has also weighed on richly
valued growth names, as interest rates could crimp future earnings. That has
weighed on the Nasdaq, which includes mega-cap growth names such as Apple
(AAPL.O) and Alphabet (GOOGL.O) and Microsoft (MSFT.O).

Richmond Fed's Barkin: U.S. may be 'on the brink' of complete recovery

The U.S. economy may be "on the brink of completing the recovery" from the
recession triggered by the coronavirus pandemic, Richmond Federal Reserve
President Thomas Barkin said on Sunday, although risks remain for some
workers.

"Vaccines are rolling out, and case rates and hospitalizations are falling.
Excess savings and fiscal stimulus should help fund pent-up demand from
consumers freed by vaccines and warmer weather," Barkin said in remarks
prepared for delivery on Sunday evening to a Credit Suisse conference on
investment in Asia.

"With this support, the economy has come most of the way back," he said,
with the recently enacted $1.9 trillion coronavirus federal relief program
fueling a jump in household incomes and savings that helps offset the
still-deep loss of jobs.

"I am hopeful that we are on the brink of completing the recovery," Barkin
said.

As the health crisis eases, he said U.S. officials should focus on how to
ease the transition back to jobs for working parents and others displaced by
the pandemic, bolster education to ensure students do not suffer from lost
time in the classroom, and take other steps to prevent "scarring."

"We should pay special attention to programs that allow primary caregivers
to return to work. This includes support for child care, elder care and
safely reopening schools," he said.

One bright spot, he said, is that so many of the jobs lost during the crisis
are in "high turnover occupations, such as housekeepers and waiters. Even
before the COVID-19 pandemic, those workers changed jobs regularly," a fact
that might lessen the overall damage from long-term joblessness.

Teleworking may also allow faster matching between workers and jobs because
those with the right skills will not necessarily have to relocate.

Once the pandemic passes, he said officials should focus on "letting market
forces work" so that government policy does not "hinder the creation of the
companies of tomorrow when trying to protect the companies of today."

U.S. House antitrust chairman plans multiple bills to go after Big Tech

Democratic Representative David Cicilline, chairman of the House Judiciary
Committee's antitrust panel, is preparing to come out with 10 or more pieces
of legislation targeting Big Tech companies, a source with knowledge of the
matter said on Sunday.

The subcommittee, under Cicilline's leadership, released a 449-page report
in October last year, which detailed abuses of market power by Apple
(AAPL.O), Amazon (AMZN.O), Alphabet's Google (GOOGL.O) and Facebook (FB.O).

The strategy to produce a series of smaller bills is aimed at lowering
opposition from tech companies and their lobbyists towards a single piece of
legislation, the source said.

Cicilline is also working on a separate bill targeting a key law called
Section 230, which offers protection to tech platforms from liability over
content users post, the source said.

His 230 legislation is likely to go after platforms such as Facebook and the
way they amplify user content.

Cicilline's comments were first reported in an interview by Axios on Sunday.
His office declined comment.

Oil falls as European lockdowns douse recovery hopes

Oil prices resumed their decline on Monday, falling around 1% as worries
about a drop in demand for fuel products in the wake of yet more European
lockdowns dominated trading.

Brent crude was down 60 cents, or 0.9%, at $63.93 a barrel by 0136 GMT. U.S.
oil was off by 68 cents, or 1.1%, at $60.74 a barrel. Both contracts fell by
more than 6% last week.

Germany plans to extend a lockdown to contain COVID-19 infections into a
fifth month, according to a draft proposal, after new cases exceeded levels
authorities say will cause hospitals to be overstretched. read more

"The reality is that we're still a long way from a full demand recovery, and
it's the record levels of withdrawn production capacity that's the main prop
for the oil market," said Stephen Innes, chief global market strategist at
Axi.

The Organization of the Petroleum Exporting Countries and its allies have
put in place unprecedented production cuts in a pact to balance global
markets after demand plunged during the COVID-19 pandemic.

U.S. drillers are starting to take advantage of an earlier spike in prices
on optimism about returning demand, adding the most rigs for extracting oil
since January in the week through Friday.

The oil and gas drilling rig tally, an early indicator of future production,
rose nine to 411 last week, the highest since April, energy services firm
Baker Hughes Co (BKR.N) said in its closely followed report on Friday.

The rig count has been rising over the past seven months and is up nearly
70% from a record low of 244 in August.

In India, Reliance Retail's private labels revolution spooks global consumer
goods makers

Inside supermarkets of Reliance Retail, run by India's richest man, Mukesh
Ambani, little-known food and home cleaning brands take pride of place on
shelves alongside global labels owned by giants Nestle (NESN.S), Unilever
(ULVR.L) and Coca-Cola (KO.N).

Products like Snac tac noodles and Yeah! colas are Reliance's private label
brands - and billionaire Ambani's not-so-secret weapons as he sets his
sights on dominating a grocery market that's already worth a cool $608
billion and set to grow more than 20% by 2024, according to Forrester
Research.

These are not just a cheap and cheerful option for urban shoppers in
Reliance's own expanding store network. This is Ambani's bet on pitching
brands that are basic, yet still aspirational at 'kiranas' - traditional
mom-and-pop stores which serve roughly 80% of the retail market in world's
second-most populous nation. read more

Already India's biggest retailer, even as a $3.4 billion deal to buy no. 2
player Future Retail awaits clearance, Reliance has "immense focus" on
private labels, said an industry executive familiar with its strategy. That
focus has already made some consumer goods firms in India uneasy, sources
say.

Reliance plans to keep expanding and promoting its private labels - even in
non-food segments - via its own supermarkets and kiranas, the executive
said, declining to be identified, like most of the people Reuters
interviewed for this story, because of a lack of authorisation to speak with
media.

"It's a worthwhile and high-margin (play)," the person said. "The company's
trying to offer brands of an equivalent quality at a lower rate ... from a
consumer standpoint, that works. It's a fact, five years down the line,
private labels will be a different landscape."

MULTI-BILLION-DOLLAR BUSINESS

Reliance Retail, part of Ambani's Reliance Industries (RELI.NS) juggernaut,
last year raised $6.4 billion by selling a 10% stake to investors including
Silver Lake Partners and KKR & Co Inc. The company is now bulking up its
e-commerce operations and is increasingly partnering with kiranas to
replenish their shelves via its own outlets and warehouses.

Consumer brands seeing their products already jostling for space with
Reliance's private label brands will have to deal with a company whose
grocery supermarket muscle will nearly triple to 2,100 outlets if the Future
Retail deal, which is facing a legal challenge at India's Supreme Court,
goes through.

Browsing shelves in Reliance stores, it's hard to miss their private-label
products, made in India mostly by small third-party manufacturers. "It is
Reliance's own brand. So we have to place these prominently," a store
employee at a Mumbai supermarket said.

Inside Reliance's supermarkets, Nestle's Maggi "2-Minute noodles" sit next
to Snac tac "Ready in 2 mins" noodles, both in yellow-coloured packaging
with an image of a red bowl full of noodles, with Snac tac costing roughly
18% less. Bottles of Yeah! colas stood beside Coca-Cola and PepsiCo's
(PEP.O) offerings, at around half the price.

Reliance declined to comment on its business strategies. Nestle India didn't
answer questions on Snac tac, but said it continues to "prioritise
innovation" and was confident its consumers will choose brands that serve
their needs.

India's top consumer goods maker Hindustan Unilever (HUL) (HLL.NS) declined
to comment, while Coca-Cola didn't respond. PepsiCo India said it doesn't
comment on strategies of other companies.

LIFESTYLE CHOICE

India is seen as offering huge potential. China's per capita consumption of
consumer goods is still four times higher than India's, according to HUL,
majority-owned by London-listed Unilever. This is despite India's rising
disposable incomes.

Analysts say Ambani's plans echo private-labels pushes mastered by the
world's biggest retailer, Walmart (WMT.N), and German supermarket chains
Aldi and Lidl.

A key difference is that Western retailers have pitched own-label goods as a
value proposition. In India, they act as both an affordable alternative and
a lifestyle choice for those previously unused to buying packaged or branded
products.

Industry executives and analysts say the push is worrying foreign and Indian
consumer giants. Pressure has already risen, with online grocers like
BigBasket and e-commerce giant Amazon (AMZN.O) expanding their private
brands portfolio.

The person familiar with Reliance's strategy said the profit margin it
offers to kiranas on products like its noodles could be as high as 20%,
compared with the 10-12% offered on similar products by multinationals.

To be sure, it's not easy to displace popular, decades-old brands. HUL says
nine out of 10 households in India use its brands, and Nestle India says
Maggi noodles strengthened its leadership position in 2019.

A Jefferies research note said last week Reliance can leverage private
labels to onboard more kiranas, but cautioned that "a success here would
require a 360 degree approach" to compete against "entrenched" players.

STRATEGIC RESPONSE

Still, one big Indian consumer firm has been conducting on-ground surveys to
study Reliance's model, while a multinational has been forced to "craft a
strategy" to find ways to safeguard its distribution model, said two
executives who declined to be identified citing business sensitivity for
their companies.

HUL is "keeping an eye" on Reliance's private label push, said a person
familiar with its thinking.

"Any game that Reliance gets into, you have to be careful," said the source,
referring to Reliance's success in disrupting the telecoms industry with
cut-price data plans for smartphones.

Alok Shah, a consumer analyst at India's Ambit Capital who has visited
stores to assess private labels, said rival consumer companies ought to be
alert.

"The only option consumer companies have is to market more or to match the
pricing of private labels ... Reliance's brands are going to be a much
bigger threat," he said.

Sales representatives of HUL, Nestle and Indian consumer giant ITC (ITC.NS)
interviewed by Reuters at various Reliance supermarkets expressed concerns
that similar packaging and lower prices on Reliance brands were luring some
customers away. A spokesperson for ITC said, "All large retailers have their
own brands that compete with established brands."

On a recent weekend in Mumbai, shoppers like 16-year-old student Soni Gupta
took advantage of a buy-one-get-one-free offer on Reliance noodles.

"It's cheaper than Maggi ... I quite like it," Gupta said.

Investors urge Europe to prioritise climate in agriculture reform

A $2 trillion group of investors on Monday urged the European Commission to
be more ambitious in its planned overhaul of the bloc's huge farming subsidy
programme to fight climate change and protect biodiversity.

Ahead of a meeting of agriculture ministers from European Union countries on
Monday, the group said proposed reforms to the Common Agricultural Policy
needed to go much further to align with the EU target to reach net zero
greenhouse gas emissions by 2050.

Led by Legal & General Investment Management and think-tank Chatham House,
the group made four recommendations, including reducing direct support for
commodities with high emissions, such as red meat and dairy.

Financial support should be linked to the cost of efforts that protect the
environmental, and incentives should be redesigned to put a value on
sustainable agriculture, rather than boosting production at the expense of
climate concerns.

Farmers should also be eligible for EU funds to help them transition away
from high-emitting activities, the group said.

"As long-term investors, and stewards of our clients’ assets, we engage with
businesses across the food and agriculture sector to help them transition
towards a net-zero economy," said Alexander Burr, ESG Policy Lead at Legal &
General Investment Management.

"However, to truly effect change we seek stronger action from policymakers,"
he said.

Agriculture accounts for around 10% of EU emissions.

A European Commission representative said it is committed to negotiating a
farming policy that will support EU green goals, and its proposals would
increase funding for sustainable schemes like carbon farming or organic
production.

"The Commission supports a new CAP that includes strong environmental and
climate ambition," the representative said.

The investor group also includes Aviva Investors, Robeco and the FAIRR
Initiative, an investor group focused on the food sector. FAIRR said it
would consult its members, who manage a collective $30 trillion, on further
areas of engagement on the issue.

Australia's CBA and ANZ settle 2016 class action on alleged interest rate
rigging

Australian lenders Commonwealth Bank of Australia (CBA.AX) and Australia and
New Zealand Bank (ANZ.AX) on Monday separately said they had agreed to
settle a 2016 class action, filed in the United States against them, for
alleged benchmark interest rate rigging.

The suit had been filed by U.S.-based investment funds and an individual
derivatives trader against 17 global banks, including ANZ's three domestic
peers that make up the so-called "big four" with it.
(https://reut.rs/3f1dVnz)

Allegations included that the banks were making hundreds of millions of
dollars in profits by setting benchmark bank bill swap rates (BBSW) at
levels that benefited their trading books, according to the filing.

The country's largest and fourth largest lenders on Monday said they did not
admit liability as part of their settlements, adding that the terms of the
settlements were confidential and that they would not materially impact the
companies.

Nigeria's Rising Debts and Its Economic Impact

By September 2020, the Debt Management Office (DMO) revealed that the
country's total public debt stock stood at $84.574 billion.

Nigeria's external debt is considered to be the biggest in sub-Saharan
Africa and has already been rescheduled several times. In spite of this
rescheduling and refinancing by creditors who were either members of the
Paris Club (governments), London Club (banks) or independent creditors,
arrears of this debt kept accumulating over time.

Records show that Nigeria's external debt remained low until the middle of
the 1970s. It was $1.5 billion in 1970 and $2.5 billion in 1975. The
situation began to get out of control around 1977 when an outstanding growth
rate in the country's debt became manifest.

The outstanding debt reached $7.5 billion in 1979 and $8.9 billion by 1980.

This was due to excess borrowing from international agencies and countries
at non-concessional interest rate as a result of the decline in oil
earnings, and the emergence of high trade arrears due to inability of the
country to either produce or foot the bills of importation of needed goods
and services.

By 2005, the nation's debt had ballooned to about $30 billion, mostly
borrowed from the Paris Club of creditors. Nigeria and the creditors' club
then went into series of negotiations on a mutually acceptable relief on the
$30 billion debt with the Paris Club.

In October 2005, Nigeria and the Paris Club announced a final agreement for
debt relief worth $18 billion. The creditors had cancelled $18 billion and
Nigeria repaid $12 billion. Most of the $18 billion was registered as aid.

The deal was completed in April 2006, when Nigeria made its final payment
and its books were cleared of any Paris Club debt.

Some Nigerians opined at the time, that it was not profitable to pay such
huge amounts of Foreign Exchange in one fell swoop just to enjoy debt
relief.

They argued that the funds could have been used to improve infrastructure
and create enabling environment to attract viable foreign investments for
economic growth.

The government of President Olusegun Obasanjo, however went ahead with the
payment and exited the country from the huge debt burden of the Paris Club.

The relief turned out to be temporary as, by June 2015, the country's debt
had again jumped to $63.8 billion, representing the country's highest debt
profile since 2007.

By September 2020, the Debt Management Office (DMO) revealed that the
country's total public debt stock stood at $84.574 billion.

DMO is the government agency established to centrally coordinate the
management of national debts.

It explained that the Debt Stock was made up of the domestic and external
debt stocks of the Federal Government, the 36 State Governments and the
Federal Capital Territory.

A breakdown of the public debt stock showed that 37.82 per cent was
external, while the balance of 62.18 per cent was domestic.

The DMO clarified that after Nigeria exited recession in 2017, the level of
new borrowing at the Federal Level as shown in the Annual Appropriation
Acts, had been declining.

The office described it as part of the government's measures to moderate the
rate of growth in the public debt stock in order to ensure debt
sustainability.

Some Nigerians, however, recently raised concerns that the country's
dependence on debt to fund annual budgets had become alarming.

There were concerns that the nature of the loan agreements, particularly
with China, was capable of compromising the country's sovereignty. In recent
times the country has consistently looked towards China for loans to bridge
huge infrastructure deficits.

In May 2020, the House of Representatives mandated some of its committees to
investigate all China-Nigeria loan agreements, to ascertain the viability of
the facilities, then regularise and renegotiate them when necessary.

Of particular interest was a sovereign guarantee clause in the agreements.
The controversial narrative was that the clause could see Nigeria sign away
its sovereignty in the event of a payment default.

However, Nigeria's transportation minister, Rotimi Amaechi, explained that
the purpose of the clause was to allow China pursue paths, including
arbitration, to settle possible disputes over payments.

"They are saying; if you are not able to pay, do not stop us from taking
back those items that will help us recover our funds.

"And it is a standard clause, whether it's with America you signed it or
with Britain or any country, because they want to know that they can recover
their money," Mr Amaechi said.

According to the DMO, as at March 2020, the total borrowing by Nigeria from
China was $3.121 billion, accounting for 11.2 per cent of the external debt
stock of $27.67 billion. This has shown that China is not really a major
source of funding for the Nigerian government.

Some stakeholders, however, condemn the seeming, perpetual dependence on
loans by the government to fund infrastructure as well as budget deficits.

An economist, Tope Fasua, advised the Federal Government to improve on the
budgeting system to check deficit financing and make the annual budgets more
impactful.

Mr Fasua said that though borrowing had become imperative due to prevailing
circumstances, especially with the advent of COVID-19, such borrowings
should be judiciously utilised to improve infrastructure that can grow the
economy.

"Unfortunately, we have found ourselves in a difficult scenario due to the
COVID-19 pandemic and falling crude oil prices and we just have to go
borrowing like most other countries in the world.

"Government should ensure that our borrowings are effectively utilised for
optimum economic impact," he said.

However, with the country's national debt in relation to Gross Domestic
Product (GDP) at 35.51 per cent, some analysts opine that the debt situation
is still within reasonable limits.

According a study conducted by the World Bank, a debt to GDP ratio that
exceeds 77 per cent for an extended period of time may result in an adverse
impact on economic growth.

This implies that the Nigerian debt situation is not really alarming when
compared to the country's GDP.

Laoye Jaiyeola, Chief Executive Officer of the National Economic Summit
Group (NESG), said that, though Nigeria's debt to GDP ratio could be
considered low, the revenue that went into debt servicing was still on the
high side.

Mr Jaiyeola opined that expending 25 per cent to 30 per cent of national
revenue on debt servicing, as presently done by the Nigerian government, was
not sustainable.

He urged the federal government to adopt tough but necessary policy choices
in order to improve on its revenue and reduce its dependence on foreign and
local loans to fund budget deficit.

"We should all be worried about the rising debt profile of the country.

"Some people say that the debt to GDP ratio is still low. It could be low,
but servicing debt is still a challenge," he said.

He suggested a drastic cut in running cost of governance, reduction in
recurrent expenditure, as well as removal of subsidies in electricity and
petroleum products, as a way of reducing the debt burden.

President Muhammadu Buhari, however, justified government borrowing to
finance infrastructure, asserting that his government took loans in the
interest of the country to solve the glaring shortfall in infrastructure.

Speaking at a virtual meeting with members of the Presidential Economic
Advisory Council (PEAC) in Abuja last June, Mr Buhari said that the country
must fix its roads to save lives from road accidents.

"We have so many challenges with infrastructure. We just have to take loans
to do roads, rail and power, so that investors will find us attractive and
come here to put their money," he said.

He regretted that the failure to provide the infrastructure for effective
transportation deprived the country of its well-deserved status as the West
African hub for air cargo transportation and trans-shipment of goods.

Recently, the DMO announced federal government's approval of a new Medium
Term Debt Management Strategy (MTDS) for the period 2020-2023.

DMO explained that the MTDS was a policy document that provided a guide to
the borrowing activities of government in the medium-term, which is usually
four years.

It explained that the new MTDS adequately reflected the current economic
realities and the projected trends, adding that its preparation involved the
consideration of alternative funding strategies available to the government.

"It seeks to meet its financing needs, taking into consideration the cost of
borrowing and the associated risks, while ensuring debt sustainability in
the medium to long-term," the DMO explained.-Premium Times.

African Countries Seek to Fill Yawning U.S.$92.8 Billion Finance Gap

AFRICAN countries are looking for inventive ways and means to fill the
annual development financing gap of US$92,8 billion.

This will enable the continent to implement the 2030 Agenda, achieve Agenda
2063, actualise the Paris Agreement as well as respond to the Covid-19
crisis whilst also tackling the growing levels of inequality.

This was revealed by Economic Commission for Africa (ECA) chief of green and
blue economy section technology, climate change and natural resources
management Nassim Oulmane while presenting a paper during a meeting of
experts at the 53rd Conference of Ministers in Addis Ababa Thursday.

Oulmane noted that Africa is not yet on track to achieving most of the
sustainable development goals given the current pace of implementation.

In his report, he reiterated the call on member states to strengthen
regional and national innovation hubs and advance science, technology and
innovation.

According to the ECA expert, the unprecedented Covid-19 pandemic, alongside
climate change effects, has undermined development progress and the
continent's ability to finance the sustainable development goals (SDGs) and
the realisation of Agenda 2063.

"Climate change is an existential threat," Oulmane said.

He went on to report that ARFSD7 resolved that raised ambitions, urgency and
redoubled efforts in implementing the Paris Agreement alongside full,
effective and timely implementation of the SDGs remained the best pathways
to achieving shared prosperity, responding to Covid-19 and tackling climate
change.

To this end, a key resolution of the ARFSD affirmed that it was crucial to
urgently strengthen systems to improve collection, availability,
accessibility, timeliness and use of quality and disaggregated data and
statistics to strengthen monitoring and reporting on the two development
agendas in the context of the Decade of Action and Covid-19.

Another key resolution in his report urged African Member States to leverage
the agreement establishing the African Continental Free Trade Area (AfCFTA)
to support increased production, create jobs, strengthen regional value
chains and develop resilience to external shocks and future crises.

The report notes that the hosting of ARFSD conferences had engendered strong
collaboration and cemented relations between the ECA, host Governments of
Morocco in 2019, Zimbabwe in 2020, Republic of Congo in 2021, the African
Union Commission (AUC), African Development Bank (AfDB) and the United
Nations System.

African Member States should leverage the Agreement establishing the
AfCFTA.-New Zimbabwe.

Nigeria Drops in UN-Backed World Happiness Ranking

Nigeria has been ranked as the 116th happiest country in the world in the
latest happiness ranking, which is lower than its position last year.

The United Nations-sponsored 2021 World Happiness Report ranked Finland as
the happiest country in the world, followed by Denmark, Switzerland,
Iceland, and the Netherlands.

The countries regarded as the most unhappy in the world were Afghanistan,
followed by Lesotho, Botswana, Rwanda, and Zimbabwe.

The top 10 countries are in the EU, except New Zealand that took the ninth
position. The United States ranked 19th while Mauritius was ranked as the
happiest African nation at 50th position.

Data from analytics researcher Gallup asked people in 149 countries to rate
their own happiness. Measures including social support, personal freedom,
gross domestic product (GDP), and levels of corruption were also factored
in.

The 2021 report focused on the effects of COVID-19 and how people all over
the world fared.-Daily Trust.

Invest Wisely!

Bulls n Bears 

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INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

Old Mutual

analysts briefing

24/03/21 | 2:30pm

Willdale

AGM

Boardroom, Willdale Administration Block, Teneriffe, 19.5km peg Lomagundi
Road, Mt Hampden

25/03/21 | 11am

TSL

AGM

Virtual | https://eagm.creg.co.zw/eagmzim/ Login.aspx | in the Auditorium,
Ground Floor, 28 Simon Mazorodze Road, Southerton

25/03/21 | 12pm

CFI

AGM

Farm & City Boardroom, 1st Floor Farm & City Complex, 1 Wynne Street

31/03/21 | 11am

Good Friday

02/04/21

Easter Sunday

04/04/21

Easter Monday

05/04/21

Independence Day

18/04/21

Public Holiday in lieu of Independence Day falling on a Sunday

19/04/21

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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