Major International Business Headlines Brief::: 04 October 2021

Mon Oct 4 10:07:14 CAT 2021

 <https://bullszimbabwe.com/> 

 <http://www.bullszimbabwe.com> Bullszimbabwe.com         <mailto:info at bulls.co.zw?subject=View%20and%20Comments> Views & Comments        <https://bullszimbabwe.com/category/blogs/bullish-thoughts/> Bullish Thoughts        <http://www.twitter.com/BullsBears2010> Twitter         <https://www.facebook.com/BullsBearsZimbabwe> Facebook           <http://www.linkedin.com/pub/bulls-n-bears-zimbabwe/57/577/72> LinkedIn          <https://chat.whatsapp.com/CF6wllAfScU9Wr6dXxoQnO> WhatsApp         <mailto:info at bulls.co.zw?subject=Unsubscribe> Unsubscribe

Major International Business Headlines Brief::: 04 October 2021

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

ü  Evergrande: Company set to update market on 'major transaction'

ü  Morrisons: US firm wins auction to take over supermarket chain

ü  Fuel issues persist in south but 'over' elsewhere

ü  United Airlines CEO: Insisting on vaccines "right thing to do"

ü  China Evergrande to raise $5 bln from property unit sale - Global Times

ü  Asian shares slip as Evergrande, inflation worries sap positive mood

ü  From 'Animal Crossing' to Netflix: Unilever and P&G search for young consumers

ü  Dollar firm, yuan slips as China Evergrande anxiety resurfaces

ü  Dollar retreats from highs as focus turns to payrolls

ü  Delta Air's ticket sales improve, reinstates initial Q3 revenue view

ü  Kenya: Limping Giant - How the Lights Were Dimmed At Kenya Power

ü  Nigeria: IMF Cautions As Crypto Market Value Surpasses N820trn

ü  Nigeria: Pandora Papers - Global Investigation Exposes Secrets of Some of Nigeria's Rich and Powerful

ü  Cote d'Ivoire: Ivorian Cocoa Farmers Are Beating a System to Reduce Child Labour - Here's How

 <mailto:info at bulls.co.zw> 

Evergrande: Company set to update market on 'major transaction'

Chinese property giant Evergrande's shares have been suspended as investors await a statement about its future.

The crisis at the world's most indebted property developer has triggered fears that its potential collapse could send shockwaves through global markets.

The firm said the trade halt came ahead of "an announcement containing inside information about a major transaction".

It comes amid reports that a rival real estate firm is reportedly set to buy a majority stake in an Evergrande unit.

In a regulatory statement to the Hong Kong Stock Exchange, Evergrande Group said that its shares had been suspended from trading "pending the release by the Company of an announcement containing inside information about a major transaction."

What is Evergrande and is it too big to fail?

Meanwhile, rival Hong Kong-listed property firm Hopson Development is set to buy a 51% stake in Evergrande Real Estate for around $5bn, according to Chinese news outlet Cailian Press.

Hopson has not yet commented on the report but has suspended trading in its shares, pending an announcement "in relation to a major transaction".

Evergrande's problems have rocked markets over concerns about its more than $300bn (£222bn) of debt.

The firm's shares have fallen by almost 80% since the start of this year.

Hong Kong's benchmark share index was 2.25% lower in Monday morning trade.

What has been happening with Evergrande?

In recent weeks Evergrande has struggled to make payments to investors in its bonds and wealth management products.

Last Thursday, the cash-strapped group said that its wealth management business had made a 10% repayment on its products , which are mainly owned by Chinese retail investors,.

That contrasts with reports of overseas bondholders saying the company had failed to make interest payments by the date they were due.

The hugely indebted property giant reportedly missed interest payments to overseas investors last week for the second time in a matter of days. It was due to pay foreign bond holders $47.5m by Wednesday.

But bondholders told Reuters news agency and Bloomberg that they were yet to receive any payment.

Under agreements with investors, the company has a 30-day grace period before the missed payments officially become a default.

Evergrande has interest debt payments of more than $160m due in the next month.

The company has been taking steps in recent weeks to raise money owed to customers, investors and suppliers. Last week, it said it was selling a $1.5bn stake it owned in a commercial bank.

The almost 20% stake in Shengjing Bank was bought by a state-owned asset management company.

Under the agreement, the proceeds of the sale are to be used to pay money Evergrande owes to Shengjing Bank, which is one of the main lenders to the heavily-indebted firm.

The company's total liabilities are equal to around 2% of China's gross domestic product.

That has triggered concerns that its problems could spread through the world's second largest economy and send shockwaves around the global financial system.-BBC

Morrisons: US firm wins auction to take over supermarket chain

A US private equity group is poised to take control of the UK's fourth-largest supermarket group.

Clayton, Dubilier & Rice (CD&R) has won an auction for the British supermarket Morrisons with a £7bn ($9.5bn) bid.

It marks a return to the UK grocery sector for Terry Leahy, the former chief executive of Tesco, who is a senior adviser to CD&R.

The takeover saga has dragged on since June amid fierce competition from two US-based investment groups.

CD&R's victory was announced by the stock market's Takeover Panel on Saturday. The private equity group offered 287p per Morrisons ordinary share, against a rival bid from Fortress, for 286p per share.

CD&R's auction offer is slightly higher than the 285p-a-share offer that was recommended by Morrisons' board in August. In July, Morrisons turned down an offer worth £5.5bn from CD&R, saying it significantly undervalued the business.

The board, which will meet on Saturday, is now expected to recommend shareholders accept the new offer at a meeting set for 19 October.

If the bid is approved by shareholders, CD&R will take over Morrisons by November.

Morrisons was founded in Bradford in 1899 - where it still has its headquarters. The group has almost 500 shops and more than 110,000 staff.

The founder, William Morrison's son, the late Sir Ken Morrison, ran the business for 50 years.

Previously, CD&R said it recognised Morrisons' "history and culture, and considers that this strong heritage is core to Morrisons and its approach to grocery retailing".

The private equity firm said it would help Morrisons to build on its strengths, including its close relationships with suppliers and its property portfolio.

Morrisons chairman Andrew Higginson and chief operating officer Trevor Strain both previously worked with Sir Terry at Tesco.

Mr Higginson said the offer represented "excellent value for shareholders while at the same time protecting the fundamental character of Morrisons".

He said the private equity firm had "a strong record of developing and growing the businesses in which they invest, and they share our vision and ambition for Morrisons".

Sir Terry thanked the board for their recommendation and said CD&R looked forward to shareholders' approval of the deal, adding: "We continue to believe that Morrisons is an excellent business, with a strong management team, a clear strategy, and good prospects."

Morrisons is among a slew of UK companies that have been targeted by overseas investors - and looks set to become the second UK supermarket chain in a year to be acquired by private equity, after Asda was bought out in February.

With the UK hit hard by the pandemic and the value of the pound still below its pre-Brexit value, UK businesses may appear cheap to non-UK investors, argues the BBC's business editor Simon Jack.

He added that while some say these bids highlight the value of - and confidence in - UK plc, others are concerned that private buyouts increase debt levels, reduce transparency and mean that key decisions about the future of UK companies like Morrisons could be taken in New York rather than Bradford.

Sir Terry also advised CD&R on its acquisition of discount retailer B&M, which netted the private equity firm an estimated profit of £1bn when it sold it on.-BBC

Fuel issues persist in south but 'over' elsewhere

Petrol supplies are still not getting to London and south-east England, with more than a fifth of forecourts still dry, retailers have said.

The Petrol Retailers Association (PRA) said it hoped the Army driving tankers would help increase fuel deliveries.

But it said the "crisis is virtually at an end" in Scotland, Wales, the North and Midlands.

Prime Minister Boris Johnson earlier did not rule out supply chain problems continuing until Christmas.

Fuel supply: Military to deliver petrol to UK garages from Monday

Conservative conference: UK in period of adjustment after Brexit, says PM

Brian Madderson, chairman of the PRA, said: "The fuel is still not going to the pumps that need it most in London and the South East."

On Sunday morning up to 22% of filling stations in the UK's most populous region were dry and only 60% had both grades of fuel available. The PRA said only 6% of stations were dry in the Midlands, northern England and Scotland.

Mr Madderson said the PRA, which represents nearly 5,500 of the UK's 8,000 filling stations, was "disappointed that no concerted action is being taken to address the supply problems" in the South.

Filling stations need to get more information ahead of time about deliveries, he said.

However, he said in the North there was a "plentiful supply at filling stations" and little queuing.

Mr Madderson added he hoped the army being deployed "will help to increase fuel deliveries".

>From Monday military personnel will start to be available for hauliers to use, with more than 65 drivers available initially.

There are plans for 200 members of the army to be deployed in total, including 100 drivers.

A government spokesman said: "Stocks in London and the South of England have been recovering at slightly slower rates than other parts of the UK, so we have begun deploying military personnel to boost supply in these areas."

"More than half of those who have completed training to make fuel deliveries are being deployed to terminals serving London and the South-East of England."

Supermarket Sainsbury's said it was still seeing "high demand" for fuel at its petrol stations.

"We're working closely with our supplier to maintain supply and all our sites continue to receive fuel," a spokeswoman said.

Many sectors of the UK economy, including food firms and petrol retailers, have been affected by a chronic shortage of lorry drivers, which the haulage industry has blamed on factors including Covid, Brexit, an aging workforce, and tax changes.

On Sunday Boris Johnson told the BBC's Andrew Marr show that labour market problems would not be solved by pulling "the big lever marked uncontrolled immigration" to allow in large numbers of foreign workers.

He insisted the lack of lorry drivers was not just a problem for the UK, and claimed the US, China, and some countries in Europe were having similar issues.

However, there have been no reports of fuel problems or interruptions to food supply linked to driver shortages in those countries.

The rush of people filling up their cars in the past week was triggered by reports that a shortage of tanker drivers was affecting deliveries.

The prime minister said the UK economy was going through a "period of adjustment" and the way to get more HGV drivers was for the industry to ensure they were "decently paid".

He added: "We have got to make sure people come on stream as fast as we practically can.

"When people voted for change in 2016, when they voted for change again in 2019 as they did, they voted for the end of a broken model of the UK economy that relied on low wages and low skills and chronic low productivity. We are moving away from that."

More than a week on from the first forecourt queues and closures, what began as a problem mainly affecting Southern parts of the country has returned to being just that.

Following limited supply issues caused by a tanker driver shortage, pleas not to panic buy were seemingly ignored. The resulting crisis has shown the impact a sudden hike in demand can have on the finely balanced supply chain.

Measures aimed at helping the distribution system cope have included temporarily relaxing competition laws, so oil firms could better share information and target fuel deliveries.

The situation appears to have improved markedly in many regions of the UK but less so in the densely-populated capital and the South East.

Businesses, the government and of course millions of motorists will hope the deployment of military drivers from Monday helps to plug remaining gaps.-BBC

United Airlines CEO: Insisting on vaccines "right thing to do"

The boss of United Airlines has told the BBC that firing staff who refuse to get a coronavirus vaccine is "just the right thing to do".

Around 300 of the airline's 67,000 US based staff are yet to comply with the strict policy, after an initial deadline of 27 September.

Vaccine hesitancy has been a hugely divisive issue in the US but President Biden recently made it easier for big companies to take a tougher line.

CEO Scott Kirby says United's strict policy is "about saving lives".

He adds that "when I retire someday, hopefully long in the future, I will look back at this and it will be one of the proudest moments of my career that we've made the tough decision, but the right decision to require vaccines."

More than 250 staff have complied with United's policy since last week's deadline. A further 2,000 employees have requested an exemption on medical or religious grounds. They haven't all been granted, but final numbers won't be clear until legal processes are resolved.

Any dismissal process could take weeks or months as the company says it would follow agreements with trade unions.

Mr Kirby says his airline's experience holds a lesson for other companies too which has been applauded by an "awful lot" of customers.

"Despite all the rhetoric and all the challenges that business leaders may think they're going to have with the vaccine requirement, we did it. It was seven weeks from the time we announced it until we finished and we got to 99%."

Passengers vaccine struggles

Whilst Mr Kirby is pleased about the influence he's been able to have over his staff there is frustration about the lack of a single global system for recognising the Covid vaccine and test status of passengers.

The airline trade body, the International Airline Transport Association, is amongst those who have tried to introduce a unified system.

"It's really complicated, and I don't blame governments", says Mr Kirby. He points out that "there's different vaccines in different parts of the world, every country has their own regulatory apparatus".

"I've never thought that we would get to a world where we had a single system that applied broadly, it'd be great if we could, just it was always impractical".

So far the pandemic has led to losses of more than $8.7bn at United. Passenger numbers of 38.6m in the first six months of this year point to recovering demand. That is slightly higher than the same time last year, but is only 48.8% of pre-covid levels, when United was the world's fourth biggest airline.

The company had been predicting that autumn would bring a return to profitability, but "the Delta variant caused a setback", says Mr Kirby. He says that the forthcoming easing of travel restrictions that will essentially reopen transatlantic travel "is really important for us".

The hope is that the airline will reach "at least a breakeven [point] at the start of the next year, particularly as we get vaccination rates up, and as Delta variant cases start to come down".

"Widespread vaccine rollout is crucial to the recovery of the global aviation industry", says the independent aviation consultant Andrew Charlton. Last year, passenger numbers fell 60% to 1.8 billion and the industry lost $126bn, according to IATA, which said it was the worst year on record. Further big losses are forecast for this year.

"United, like the other big American carriers, have generally coped pretty well with the pandemic" says Mr Charlton. He explains this is because "around 75% of their operations are domestic travel which hasn't been disrupted as badly as international flights. Assuming there are no more big shocks that has given them financial resilience to reshape and resize themselves for after the pandemic".

Despite getting more than $10bn of support from the US government to get through the pandemic, much of which has been repaid with private borrowing, the airline is still investing heavily in the future. As well as ordering 270 new aircraft it is planning to launch supersonic flights in 2029, they would be the first commercial flights that are quicker than the speed of sound since Concorde retired in 2003.

The planes are being made by Boom Supersonic and are expected to reach speeds of 1,122mph (1,805km/h). Going that fast requires more fuel than conventional aeroplanes, which has led to criticism about their environmental impact.

Mr Kirby says "it's been important that we've worked with Boom Supersonic to develop these aeroplanes in a sustainable way. This will be the first aeroplane, the first aircraft engines ever designed from scratch to run on 100% sustainable aviation fuel".

Mr Kirby is adamant that there is a need to travel so quickly. "It's much more productive for you as a business traveller or even as a leisure traveller to get there faster".

But it is business travellers that the airline has in mind for the $200m aircraft. When it comes to the economics, Mr Kirby says "an all-business class aeroplane at the kinds of business class fares that we charge today is profitable".

He is resolute that business travel will return in the pandemic despite the rise of video calls. "Business travel is about human relationships. It's not about the transaction".

"I think zoom and technology like this is going to replace phone calls. But it is not going to replace the need to be there in person".

Leisure travel will also recover says Mr Kirby, but he agrees with a recent Boeing forecast that it will take until 2024 for global aviation to fully recover from the pandemic.

He predicts domestic US travel, the majority of his business, will lead the way. "Certainly by 2023, probably by the end of next year, we're back to normal travel between the US and Europe". But, he adds "there are parts of the globe that are going to take longer".-BBC

China Evergrande to raise $5 bln from property unit sale - Global Times

(Reuters) - Distressed developer China Evergrande will sell a half-stake in its property management unit to Hopson Development for more than $5 billion, Chinese media said on Monday, after both Evergrande and Hopson requested trading halts ahead of a major transaction.

Once China's top-selling developer, Evergrande is facing what could be one of the country's largest-ever restructurings as a crackdown on debt leaves it unable to refinance $305 billion in liabilities.

Evergrande said it requested a trading halt pending an announcement about a major transaction and Evergrande Property Services Group (6666.HK) said the announcement constitutes "a possible general offer for shares of the company."

China's state-backed Global Times said Hopson Development (0754.HK) was the buyer of a 51% stake in the property unit for more than HK$40 billion ($5.1 billion), citing unspecified other media reports. Hopson said it had suspended trading in its shares, pending an announcement related to a major acquisition of a Hong Kong-listed firm and a possible mandatory offer.

Both Hopson and Evergrande did not respond to requests for comment on the Global Times report.

The possible deal seemed to rekindle broader concerns about the risk of contagion or of a hit to China's property sector and the broader economy if Evergrande collapses or is liquidated at rock-bottom prices.

"Looks like the property management unit is the easiest to dispose in the grand scheme of things, indicative of the company trying to generate near term cash," said OCBC analyst Ezien Hoo.

"I'm not sure this necessarily means that the company has given up on surviving, especially as selling an asset means they are still trying to raise cash to pay the bills."

Beijing has prodded government-owned firms and state-backed property developers to purchase some of Evergrande's assets, people with knowledge of the matter told Reuters last week. read more

It was unclear whether Hopson's statement was related to Evergrande Group. However, Hopson stands in good stead compared with other property developers, owning more assets than liabilities, improving profit in the first half and paying a dividend.

Shares of Hopson, which has a market value of HK$60.4 billion ($7.8 billion), have jumped 40% so far this year and it was rated B+ by Fitch in June.

Evergrande's property development unit was also profitable in the first half of 2021 and revenue rose compared with a year earlier.

NERVOUSNESS

With liabilities equal to 2% of China's gross domestic product, Evergrande has sparked concerns its woes could spread through the financial system and reverberate around the world.

Initial worries have eased somewhat after China's central bank vowed to protect homebuyers' interests, but ramifications for China's economy kept investors on edge. read more

Monday's share trading suspension sent a shiver through the offshore yuan , which fell about 0.3% against the dollar, and weighed on the Hang Seng benchmark index (.HSI), especially financials and other developers.

"(The) consensus is expecting a restructuring, but authorities to limit systemic risk from Evergrande," said Bank of Singapore analyst Moh Siong Sim. But there is "a bit of nervousness," he added.

Guangzhou R&F Properties Co Ltd (2777.HK) fell 6%, while Sunac China Holdings (1918.HK) and Country Garden (2007.HK) stocks came under pressure before paring losses. Shares in Evergrande's electric vehicle unit (0708.HK) rose more than 10%.

Shares in Evergrande have plunged 80% so far this year, while its bonds trade at distressed levels. Shares in its property services unit have dropped 43% as the group scrambles to pay its many lenders and suppliers. read more

The cash-strapped group said last month that it had negotiated a settlement with some domestic bondholders and that it had made a repayment on some wealth management products, largely held by Chinese retail investors.

Holders of the company's $20 billion in offshore debt appear further back in the queue and bondholders have said interest payments due on bonds in recent weeks have failed to arrive.

Evergrande faces deadlines on dollar bond coupon payments totalling $162.38 million in the next month.

($1 = 7.7868 Hong Kong dollars)

The Thomson Reuters Trust Principles.

Asian shares slip as Evergrande, inflation worries sap positive mood

(Reuters) - Asian shares dipped on Monday as concerns about China's property sector and inflation worries offset upbeat U.S. data and positive news on new drugs to fight the coronavirus.

Trading in shares of debt-laden China Evergrande (3333.HK) was suspended after it missed a key interest payment on its offshore debt obligation for the second time last week. read more

"The biggest problem is not a default by Evergrande but the environment that has led to its downfall. Authorities are regulating housing loans and lending to property firms. Markets are looking for a next Evergrande already," said Kazutaka Kubo, senior economist at Okasan Securities.

"There is rising risk Evergrande's woes will spread to the entire Chinese property sector."

MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) fell 0.3%. The index marked its first quarterly fall in six quarters.

Hong Kong led the decline with a 1.9% fall in the Hang Seng index(.HSI). Japan's Nikkei (.N225) erased earlier gains to stand 1.4% lower at one-month lows of 28,375.

Chinese mainland markets will be closed until Thursday for the National Day holiday while South Korean markets were also shut on Monday.

MSCI's broadest gauge of world shares, ACWI (.MIWD00000PUS), slipped 0.1% to 711.92, not far from a three-month low hit on Friday at 705.27.

Investor sentiment got a lift on Friday after Merck & Co (MRK.N) said an experimental oral antiviral treatment could halve the chances of dying or being hospitalised for those most at risk of contracting severe COVID-19. read more

A host of U.S. economic data released on Friday also showed increased consumer spending and accelerated factory activity but also lofty inflation. read more

Data published on Friday also showed euro zone inflation hit a 13-year high last month and looks likely to jump higher still. read more

Investors fear global inflation could persistfor longer than expected, given a continued rise in commodity prices and ongoing supply disruptions in many parts of the world, despite Fed Chair Jerome Powell's insistence that high inflation is transitory. read more

The core U.S. PCE price index, the Federal Reserve's preferred inflation measure for its flexible 2% target, increased 3.6% in August from a year earlier, its biggest rise in three decades and matching July's gain.

"Although Powell has stuck to his script that inflation will be transitory, he is also recently starting to hedge his comments too, leading investors to suspect he, too, is worried about inflation," said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

Expectations that elevated inflation could prompt the Federal Reserve to bring forward its timeline for monetary policy tightening has boosted U.S. bond yields last week.

But yields have pulled away from last week's multi-month peaks as month-end buying underpins bond prices.

The 10-year U.S. Treasury yield stood at 1.460% , off Tuesday's three-month high of 1.567%.

Lower U.S. yields also weighed on the dollar in the currency market. The euro bounced back to $1.1608 , off Thursday's 14-month low of $1.1563.

The U.S. currency dipped to 111.00 yen , staying below Thursday's 1 1/2-year high of 112.08 yen.

Oil prices remained elevated, with Brent futures staying just shy of a three-year peak hit late last month, on expectations oil producing countries will raise supply in a steady manner when they meet on Monday. read more

Brent futures traded at $78.99 per barrel , down 0.3% in early trade.

The Thomson Reuters Trust Principles.

>From 'Animal Crossing' to Netflix: Unilever and P&G search for young consumers

(Reuters) - Unilever Plc (ULVR.L)  and Procter & Gamble (PG.N), the world's top two  advertisers, are seeking out younger audiences by reallocating some 2021 spending away from traditional TV and into video games, streaming services and media programs operated by retailers like Walmart (WMT.N) and Tesco (TSCO.L).

As they continue to look at their digital ad budgets and try to appeal to younger shoppers - who have during the pandemic convened around Nintendo Switch game consoles and in front of Netflix screens - the two consumer giants have turned to tie-ups with popular services like Hulu and HBO Max and games like Fortnite and Animal Crossing.

Shoppers of all ages also avoided big box retailers’ stores and placed orders on online platforms. Following a 25.7% increase in 2020, retail ecommerce sales worldwide are expected to rise to $4.92 trillion in 2021, according to data firm eMarketer.

Unilever is “rethinking” how it spends its advertising budget as the prolonged pandemic has accelerated a shift in the way people shop and entertain themselves, Luis Di Como, Unilever’s executive vice president of global media, told Reuters. He said digital marketing at Unilever, which makes Ben & Jerry’s ice cream and Dove soap, now accounts for roughly 45% of its total media budget versus about 40% prior to the pandemic.

Unilever holds monthly gaming "master classes" for members of its marketing team, inviting professional video game players and industry experts to keep the company attuned to consumers, Di Como said.

A representative of P&G, which makes Tide detergent and Gillette razors, said its “plans are evolving” to reach people “where they are – including in places like streaming and gaming."

"It seems a little riskier - I mean it's test-and-learn at this point," said Elizabeth Marsten, a senior director at marketing data firm Tinuiti. "But at the same time, how will you know if you don't try? You've got to go where the people are and 20-year-olds don't have linear TV."

2.7 BILLION GAMERS

Unilever's total marketing budget is 7.5 billion euros ($8.85 billion). Di Como declined to break out how much of that it spends on media, but  he said Unilever is shelling out “much more” on ecommerce advertising platforms in addition to gaming and streaming platforms.

"We are investing on retailer media. So not only the pure-players like Amazon but also - when you think about omni-channel - players like Walmart, Tesco, Target, Carrefour that are also becoming media companies," Di Como said.

Unilever is also branding new products to appeal to people who stream more TV and movies during lockdowns. In a nod to shoppers' heavy use of streaming entertainment, for instance, Ben & Jerry's launched an ice cream flavor called "Netflix and Chill'd," a play on the popular millennial internet meme "Netflix and Chill."

Late last year, Unilever’s Hellmann's condiment brand tied up with Nintendo farming video game "Animal Crossing: New Horizon," promising to donate to a food waste charity each time a player donated a virtual vegetable to charity within the game.

According to data firm Newzoo, there are more than 2.7 billion gamers worldwide, and the size of the video game market will surpass $200 billion by 2023.

In  Britain, Unilever's deodorant  brand Axe sponsors a handful of top gamers, including  Calfreezy.  In China, which contributes  about 6%  to overall sales, Di Como said the company backs e-sport celebrities  and leagues,  which are rapidly gaining popularity among the affluent younger generation in Asia. The company has an Apple TV+ documentary on paternity leave sponsored by its Dove Men + Care brand.

P&G also has a tie-up with Animal Crossing through its Venus women's razor brand. The company told Reuters that it measured nearly 1 billion impressions when it created more skin types for in-game characters, which represent features including freckles, acne, cellulite, hair scars and stretch marks and psoriasis.

Dollar firm, yuan slips as China Evergrande anxiety resurfaces

(Reuters) - The safe-haven dollar found support just below last week's peaks on Monday as renewed concerns about China's property sector and looming U.S. labour data put investors in a cautious mood.

The greenback scaled a 14-month high on the euro and a 19-month top on the yen last week as markets reckoned U.S. interest rates could rise ahead of global peers.

The euro dipped back below $1.16 and at $1.1598 is not far from last week's trough at $1.1563. The yen was little changed at 111.065 per dollar. The offshore yuan fell about 0.3%.

Shares in embattled developer China Evergrande (3333.HK) were halted in Hong Kong, rekindling market nerves about the possibility of contagion. read more

Evergrande said it requested a trading halt pending an announcement about a major transaction, while unit Evergrande Property Services Group said the announcement constitutes "a possible general offer for shares of the company." read more

Investors are concerned that a collapse at Evergrande could hurt an already fragile Chinese economy and drag on global growth. The U.S. dollar index edged up 0.08% to 94.029.

"(There's) a bit of nervousness," said Moh Siong Sim, currency analyst at the Bank of Singapore, even if most traders still think Evergrande's systemic risk can be contained.

"It's part of the wall of worry," he said, which the market could eventually "climb" if the COVID backdrop improves, growth stabilises and inflation concerns subside, but which for now is keeping investor sentiment fairly dour.

Besides Evergrande, a Friday CNBC report which said U.S. Trade Representative Katherine Tai will announce on Monday that China is not complying with U.S.-China trade rules also provided support to the dollar, especially against the yuan.

Chinese markets were closed for a holiday.

In the week ahead, the Reserve Bank of Australia meets on Tuesday and is expected to keep policy steady. Across the Tasman, a 25 basis point hike from the Reserve Bank of New Zealand on Wednesday is priced in.

The Australian dollar was about flat at $0.72685 and the New Zealand dollar was little changed at $0.6941.

On Friday, U.S. labour data is expected to show continued improvement in the job market, with a forecast for 460,000 jobs to have been added in September - enough to keep the Federal Reserve on course to begin tapering before year's end.

"The question is whether there is a number that alters the Fed's view on tapering its bond purchases in November, and what a really weak or hot number means amid the backdrop of rising stagflation fears," said Pepperstone's head of research, Chris Weston.

"If U.S. Treasuries find further buyers this week into Friday's U.S. non-farm payrolls, the dollar may go on sale this week."

Elsewhere economists polled by Reuters expect the cash rate on hold in Australia until at least 2024, as the RBA has been insisting it will be.

Swaps markets show a 97% probability of a rate hike in New Zealand on Wednesday and a 96% chance of another one in November.

Sterling, meanwhile, despite Friday gains, is still nursing losses from a sharp drawdown last week when traders shrugged off hawkish central bank rhetoric to focus on a sour outlook and the risk of both higher rates and inflation.

The pound was about flat from last week at $1.3540.

"Investors are judging the UK by its whole suite of fundamentals factors and movements in sterling suggest that many are not liking what they are seeing," said Rabobank strategist Jane Foley, as the currency erases early 2021 gains.

"The UK no longer has an advantage on the vaccine front...and, while PM (Boris) Johnson likes to view Brexit as 'done', many businesses and commentators are only just starting to evaluate its impact."

The Thomson Reuters Trust Principles.

Dollar retreats from highs as focus turns to payrolls

(Reuters) - The dollar eased from last week's peaks on Monday as encouraging trial results for a COVID-19 pill supported risk appetite, but investors remained cautious ahead of central bank meetings in Australia and New Zealand as well as U.S. labour data this week.

The euro crept back above $1.16, and was up 0.1% at $1.1606, a recovery from last week's 14-month low of $1.1563. The yen has also bounced from a 19-month low and was similarly up 0.1% in Asia trade at 110.92 per dollar.

Sterling, the Australian dollar and the New Zealand dollar all edged higher in early trade, extending late-week gains.

"Whether it follows through or not, I don't know," said Westpac analyst Imre Speizer on the phone from Christchurch.

"I'd say there could still be more downside and that would prop up the U.S. dollar and Aussie and kiwi would fall a little bit further," he said, with sentiment in the driver's set.

In the week ahead, the Reserve Bank of Australia meets on Tuesday and is expected to keep policy steady. Across the Tasman, a 25 basis point hike from the Reserve Bank of New Zealand on Wednesday is priced in.

And on Friday, U.S. labour data is expected to show continued improvement in the job market, with a forecast for 460,000 jobs to have been added in September - enough to keep the Federal Reserve on course to begin tapering before year's end.

Sterling rose 0.25% to $1.3568, a third consecutive session in the green after a sharp drawdown last week when traders shrugged off hawkish central bank rhetoric to focus on a sour outlook and the risk of both higher rates and inflation.

"Investors are judging the UK by its whole suite of fundamentals factors and movements in sterling suggest that many are not liking what they are seeing," said Rabobank strategist Jane Foley, as the currency erases early 2021 gains.

"The UK no longer has an advantage on the vaccine front...and, while PM (Boris) Johnson likes to view Brexit as 'done', many businesses and commentators are only just starting to evaluate its impact."

The Australian dollar was up 0.1% to $0.7273 and kiwi was marginally firmer at $0.6952.

Economists polled by Reuters expect the cash rate on hold in Australia until at least 2024, as the RBA has been insisting it will be.

Swaps markets show a 97% probability of a rate hike in New Zealand on Wednesday and a 96% chance of another one in November.

Traders likewise think that it will take a lot to derail the Fed from its tapering track, but steadying Treasury yields along the curve points to some risk to the timing.

"The question is whether there is a number that alters the Fed's view on tapering its bond purchases in November, and what a really weak or hot number means amid the backdrop of rising stagflation fears," said Pepperstone's head of research, Chris Weston.

"If U.S. treasuries find further buyers this week into Friday's U.S. non-farm payrolls, the dollar may go on sale this week."

The Thomson Reuters Trust Principles.

Delta Air's ticket sales improve, reinstates initial Q3 revenue view

(Reuters) - Delta Air Lines (DAL.N) said on Sunday that its ticket sales had stabilized and started to improve, putting it on course to deliver third-quarter revenue within its original forecast for a 30%-35% drop versus corresponding 2019 levels.

This is an improvement from its projection last month when it adjusted the forecast to the lower end of that range after a resurgence in COVID-19 cases. The airline is due to report results for the quarter through September on Oct. 13.

"For Delta, they bottomed out in the later part of August and the first part of September," Chief Executive ED Bastian told reporters on the sidelines of a meeting of airlines group IATA. "Business traffic is growing back in the U.S."

Domestic travel bookings are expected to surpass 2019 levels next year, Bastian added.

Later, the airline said it would boost its capacity by more than 20% next summer over the 2019 peak by increasing service from Boston.

The company is also seeing a surge in demand for trans-Atlantic flights after the White House's decision late last month to reopen the country to fully vaccinated travelers from around the world.

Trans-Atlantic flights accounted for 11% to 17% of 2019 passenger revenues for the big three air carriers - American Airlines (AAL.O), United Airlines (UAL.O) and Delta.

On Delta's staff vaccination rate, Bastian said it had gone up to 84%, driven, in part, by the company's decision to impose a $200 monthly health insurance surcharge for those who had not been vaccinated. He expects the rate to be above 90% by Nov. 1.

Delta, however, is the only major U.S. airline that has still not mandated coronavirus vaccines for employees despite the pressure from the White House.

Bastian said the company has not decided whether to mandate COVID-19 vaccines.

"We're obviously studying it," he said, referring to President Joe Biden's executive order requiring federal contractors to mandate vaccinations.

"I'm not sure how far you need to go in order to be in compliance with the EO (executive order)."

The White House is pressing major U.S. airlines to mandate COVID-19 vaccines for employees by Dec. 8 - the deadline for federal contractors. Large U.S. airlines have a number of federal contracts. read more

The Thomson Reuters Trust Principles.

Kenya: Limping Giant - How the Lights Were Dimmed At Kenya Power

If Kenya Power was not majority owned by the State, it would now be a company in receivership. Banks would be circling around it, ready to strip down its assets, and sell them to cut loses.

But being a parastatal, there is only one way out: The taxpayer has to bail it out in one way or the other. It is also such an important company for Kenya's economy to be left to die.

All the critical numbers at the firm are blinking red. To meet its day-to-day operations, the giant is now surviving on overdraft facilities -- the modern-day Fuliza.

It owes banks more than Sh110 billion. And in the past three years, the risks of defaults have been growing bigger and bigger.

Its finance bosses have been busy, writing one letter to one commercial bank after the other, asking to be allowed to breach the company's loan covenants without punishment.

The power distributor has a huge stock of current liabilities, totalling Sh117 billion, and had exceeded its Sh44.6 billion current assets by a staggering Sh74 billion by June 2020.

Current liabilities are debts and loans that must be paid within a year.

This mountain of debt and Kenya Power's waning ability to service loans and pay suppliers continue to pile pressure on its going concern basis. If a company is unable to meet these liabilities when they become due, then it can be declared insolvent. Besides the money owed to commercial banks, the company also has significant debts to contractors, suppliers and power generators.

There are some contractors who have not been paid into the fourth year now. Its losses are getting bigger and more painful, with the latest being a Sh7 billion loss.

Current financial mess

There is also one more problem on its doorstep: Kenya Power has breached the Capital Market Authority (CMA) listing regulations, reporting significant negative working capital for the fourth year in a row.

"The company has reported negative working capital position for the fourth consecutive year. As disclosed by the board and management in the past and current financial statements, strategic initiatives have been undertaken to improve the financial results of the company," Auditor-General Nancy Gathungu writes after reviewing the company's books.

"However, these initiatives appear not to have yielded the intended results. These conditions indicate that a material uncertainty exists, which may cast significant doubt on the company's ability to continue as a going concern." The company is also in breach of loan covenants, particularly in regard to the maximum debt capacity and adequate working capital.

So, just how did the company get here?

By the time it had signed up all the power suppliers, the company found itself having more power than the market demand. This should have been a good problem for the company if it did not have lopsided take-or-pay power purchase agreements with 44 expensive power producers.

Its internal document detailing the roadmap of getting out of its current financial mess shows that its problems became bigger when the total energy supply was not keeping pace with demand.

The current installed generation capacity is 2,788 MW against peak demand of 1,976 MW.

The take-or pay-model requires the utility company to pay the power producer a certain amount of money whether they supply power or not.

This guarantees the power producers' income in perpetuity but punishes Kenya Power to take up expensive power even when there are cheaper alternatives.

Last mile project

There were also the forex based Power Purchase Agreements (PPAs) and capacity charges that have helped sink the company in debt abyss. These ones meant that any weakening of the Kenyan shilling against the US dollar would increase the costs of power. This and the huge foreign denominated debt pose a great forex risk to the company.

The firm says that every Sh1 devaluation against the US dollar translates Sh1 billion due to forex losses.

The fact that the company is invoiced by power producers in dollars and Euros when it invoices its customers in Kenya shilling is also a huge nightmare-- given the fact that it has to pass the costs to the consumer but also ensure it does not make electricity too expensive and push large consumers to generate own power. In the last financial year, the company booked its cost of sales as Sh87.4 billion. Under these costs are power purchase costs of Sh47.4 billion, which relate to capacity charges slapped on the firm as per the PPAs.

"These charges, which account for 54 per cent of the total cost of sales, are significant and considering their fixed nature, may have adversely affected the company's performance resulting in loss," Ms Gathungu notes.

The huge staff complement of 10,500 employees is also major contribution to high administration costs of Kenya Power and have now been marked as unsustainable.

But the company's hands are tied on how to reduce the wage bill without firing.

Multiple interviews with insiders, however, point to the ambitious last mile project and procurement scandals that came after it as the last straw that broke Kenya Power's back.

As the company rushed to beat the one million connections per year to meet Jubilee government's targets, it ended up burning its cash, connecting households that could not afford to maintain an electricity connection. In informal settlements, after the connections, some unscrupulous electricians colluded with the metre owners to remove the meters and sell them elsewhere.

Instead, they ended up with direct connections that bypassed the meters, making it a double loss for the company. The Last Mile connectivity project also had huge impact on the current Kenya Power debt stock given that the company had to start borrowing to keep up with the demands.

Theft of power

After three years of aggressive expansion, the company realised that only its costs were going up, but revenues had remained nearly flat.

Executives at the firm were puzzled by the fact that even after more than doubling the number of Kenyan's connected to the national grid, its revenues were growing by single digits, outpaced by the huge transmission costs. These wiped out any gains made from extra sales in electricity.

The huge system losses that have remained relatively high at 23.46 per cent due to technical and commercial factors arising from the expanded transmission and distribution network as well as increased electricity pilferages have also not helped.

Half of the system losses are commercial and result from theft of power and illegal connections.

Most of the theft happens from transformers around Industrial Area and other heavy consumers in steel and cement industries.

This means that for every Sh100 of power it distributes, about Sh23 is lost. This is still way higher than the allowable system losses of 19.9 per cent by the Energy and Petroleum Regulatory Authority (Epra).

In July 2020, the regulator revised the allowable system losses from 14.9 per cent. Sources within the company have also attributed the company's woes to various procurement scandals at the company.

"Every board that comes in arrives with its own agenda. Some want to procure poles, others want to procure transformers. They all just want a major procurement in their lifetime to ensure someone makes money," a source said.

This and its own staff that have found ways to manipulate the billing system to corruptly reduce bills for connected and powerful industries have destroyed the company.

Procurement corruption

The procurement-driven managers have led the company to end up with huge inventories of slow moving and obsolete stock.

In the last financial year, the company had a carrying amount of inventories amounting to Sh4.8 billion.

This is after considering allowance for obsolete, slow moving and non-moving inventories of Sh3.9 billion. This has cost the company billions of shillings as it writes off such dead inventory.

It is also how the company ended up with a junkyard of obsolete and poor quality transformers that blow up days after installation.

But it is the corruption in the procurement department that hurt Kenya Power most.

In its own admission, the company acknowledges that the department must be overhauled to deal with the legacy issues around value procurement, excess quantities and high value of obsolete stocks.

It has recommended the suspension of all procurement staff.

"Suspension of all procurement staff at KPLC and undertake a vetting exercise for suitability to continue holding public office," the company says in its internal document.

Poor debt collection

Kenya Power wants the vetting to be done by the National Intelligence Service (NIS) or the Ethics and Anti-Corruption Commission (EACC).

The company also wants National Treasury to deploy its technical procurement officers to facilitate sourcing, stock and contract management.

To get out of the mess, the Kenya Power board wants to be approving strategic procurement items and their standards and specifications as well as develop a procurement manual incorporating a robust contract management and oversight framework.

The company also must undertake a forensic procurement audit.

The firm's ICT systems have also been blamed for its current woes since they are not configured accordingly to monitor revenue.

At some point, there were even fears that the company's official paybill number had been infiltrated by staff and the money from the account was being paid to two different accounts-- one owned by Kenya Power and the other to an unknown account. Investigations of this front went cold.

The firm is also hurting from poor debt collection both from the private sector and the governments.

More than half of its debtor book is over 90 days old, meaning the chances of collecting the money are growing slimmer by the day.

This debt grew by Sh3.8 billion last year, exacerbated by Covid-19. Ms Vivienne Yeda, the company's board chairperson, said the Covid safety measures together with the negative GDP growth, affected the company's electricity sales and revenue collection in the year ended June 2020.-Nation.

Nigeria: IMF Cautions As Crypto Market Value Surpasses N820trn

Financial experts with the International Monetary Fund (IMF) have called for caution and regulation as the total market value of all the crypto assets surpassed $2 trillion (N820 trillion) - a 10-fold increase since early 2020.

The experts, Dimitris Drakopoulos, Fabio Natalucci and Evan Papageorgiou, in an article on the IMF's blog, warned that many of these entities lacked strong operational, governance and risk practices.

They noted that crypto assets offered a new world of opportunities but warned that along with the opportunities come challenges and risks.

The trio explained that crypto exchanges, for instance, have faced significant disruptions during periods of market turbulence, adding that there are also several high-profile cases of hacking-related thefts of customer funds.

The financial experts argued that consumer protection risks remain substantial given limited or inadequate disclosure and oversight.

"For example, more than 16,000 tokens have been listed in various exchanges and around 9,000 exist today, while the rest have disappeared in some form.

The extent of the adoption of crypto assets is difficult to measure, however, surveys and other measures suggest that emerging markets and developing economies like Nigeria may be leading the way.-Daily Trust.

Nigeria: Pandora Papers - Global Investigation Exposes Secrets of Some of Nigeria's Rich and Powerful

The Pandora Papers series is launching more than five years after the Panama Papers revelations of 2016. That investigation exposed offshore companies linked to more than 140 politicians in more than 50 countries.

A new global investigation exposing the offshore hideaways of some of the world's most powerful personalities is launching today after two years of discreet work by investigative journalists around the world.

The project, known as Pandora Papers, is facilitated by the International Consortium of Investigative Journalists (ICIJ), which obtained a trove of 11.9 million confidential files. The reporting, which is still ongoing, involves more than 600 journalists from 150 news organisations around the world.

The journalists spent two years studying and sorting files, contextualising information, tracking down sources and analysing public records and other documents.

The collaboration has so far revealed the financial secrets of not less than 35 current and former world leaders, more than 330 public officials in more than 91 countries and territories.

The leaked files were retrieved from 14 offshore services firms around the world that set up shell companies and other offshore entities for clients, many of them influential politicians, businesspersons and criminals, seeking to conceal their financial dealings.

PREMIUM TIMES is the only Nigerian newspaper participating in what has now been dubbed the biggest journalism partnership in history.

The stories we will publish in the days to come will reveal how some of the most influential Nigerians - a former Chief Justice of Nigeria, current and former state governors, past and present lawmakers, businesspeople, a popular pastor and many others - set up shell companies, and sometimes warehouse huge financial assets, in notorious secrecy jurisdictions.

Our stories will also show how some of these individuals flout extant laws and legislations as they hide these assets, some of which have attracted the interest of law enforcement agencies in the UK and elsewhere.

In an era of widening authoritarianism and inequality, ICIJ said "the Pandora Papers investigation provides an unequalled perspective on how money and power operate in the 21st century -- and how the rule of law has been bent and broken around the world by a system of financial secrecy enabled by the U.S. and other wealthy nations."

"In popular imagination, the offshore system is often seen as a far-flung scattering of palm-shaded islands. The Pandora Papers show that the offshore money machine operates in every corner of the world, including financial capitals of the richest and most powerful economies," the ICIJ added.

Globally, the Pandora Papers investigation will reveal the secret owners of offshore companies, anonymous bank accounts, private jets, yachts, mansions, and artworks by Picasso, Banksy, and other masters.

"It provides more information than what's usually available to law enforcement agencies and cash-strapped governments," the ICIJ said.

"Large numbers of public officials and mega-wealthy individuals -- who in some cases are one and the same -- use the offshore system to manage, move and, often, hide their wealth. They play by different rules from the rest of humanity, in a game of intrigue and privilege that fuels crime and corruption and entrenches the power of the world's economic and political elites.

"The Pandora Papers investigation is larger and more global than even ICIJ's landmark Panama Papers investigation, which rocked the world in 2016, spawning police raids and new laws in dozens of countries and the fall of prime ministers in Iceland and Pakistan.

"The Panama Papers came from the files of a single offshore services provider: the Panamanian law firm Mossack Fonseca. The Pandora Papers shine a light on a far wider cross-section of the lawyers, middlemen and fixers who are at the heart of the offshore industry.

"The Pandora Papers lay bare the finances of many more country leaders and public officials than did the Panama Papers and provide more than twice as much information about the ownership of offshore companies. In all, the new leaks uncover the real owners of more than 29,000 offshore companies the owners come from more than 200 countries, with the largest contingents from Russia, the U.K., Argentina, China and Brazil."

The Pandora Papers Vs Panama Papers

The Pandora Papers series is launching more than five years after the Panama Papers revelations, which were published in 2016. That investigation exposed offshore companies linked to more than 140 politicians in more than 50 countries - including 14 world leaders.

It also uncovered offshore hideaways tied to mega-banks, corporate bribery scandals, drug kingpins, Syria's air war on its own citizens and a network of people close to Russian President Vladimir Putin who shuffled as much as $2 billion around the world.

In the course of that investigation in Nigeria, PREMIUM TIMES published more than 30 stories, with damning details revealing the secret offshore asset of many prominent Nigerians.

It is not illegal for Nigerians who are not public officers to own offshore accounts, and many prominent businesses do have them. However, some public officials found to have accounts did not disclose them as expected by law.

This newspaper's investigations revealed the secret offshore assets of Senate President Bukola Saraki and his wife Toyin; as well as those of Mr Saraki's predecessor, David Mark.

It also revealed how the late governor of Bayelsa State, Diepreye Alamieyeseigha, began looting his state and hiding public funds in offshore structures and how a former governor of Delta State, James Ibori, organised the stealing of the oil-rich state's fund via offshore companies.

The investigations also revealed a network of shell companies in offshore tax havens linked to Africa's richest man, Aliko Dangote, and his brother, Sayyu Dantata; as well as the offshore companies of Wale Tinubu, the chief executive of Nigeria's biggest indigenous oil company, Oando Plc, among others.

Similarly, the stories also exposed the secret offshore company of one of Africa's most influential televangelists, Temitope Joshua, popularly called T.B Joshua, who died in June.

Other prominent Nigerians named in the investigations were former Minister of Defence and billionaire businessman, Theophilus Danjuma; Businessman, Hakeem Bello Osaigie; Globacom CEO, Mike Adenuga; Governor Abubakar Sadiq Sani Bello of Niger State; the late Ooni of Ife, Okunade Sijuwade; former Arik Air Chairman, Joseph Arumemi-Johnson and his wife, Mary, as well as two then-serving senators - Andy Uba (Anambra) and Ibrahim Gobir (Sokoto).

Other top business persons, politicians, and their family members were also found in the infamous database, including those who were then holding public offices.

The revelations sparked outrage across Nigeria, with activists, civil society organisations, the labour movement and the general public calling for extensive probes of those mentioned. But none of the violators has so far been prosecuted or sanctioned.

"The Pandora Papers series will be even more revealing," Nicholas Ibekwe, PREMIUM TIMES head of investigations, said. "We hope the Nigerian authorities will take appropriate actions this time around to sanction those proven to have violated our laws."-Premium Times.

Cote d'Ivoire: Ivorian Cocoa Farmers Are Beating a System to Reduce Child Labour - Here's How

The evidence of child labour on cocoa farms in West Africa became public knowledge in the late 1990s. This followed press reports documenting the existence of hazardous child labour on cocoa farms. Pressure on the cocoa industry to end child labour has been growing ever since, particularly from civil society and more recently from both US and European regulators.

To meet consumer demand for more sustainable and ethical cocoa, the industry began using certification schemes in the late 2000s. Certification labels, such as Rainforest Alliance and FairTrade, aim, among other goals, to guarantee cocoa produced without the use of child labour.

It is estimated that between one-third and one-half of the cocoa sold worldwide is currently certified.

In September 2001, by ratifying the Harkin-Engel Protocol, the cocoa industry committed to reduce the most hazardous forms of child labour by 70% by 2020. Yet, Côte d'Ivoire, the world's largest cocoa producer, is still struggling with child labour on its cocoa farms.

Indeed, the number of children under the age of 18 working on cocoa farms (certified or not) actually increased between 2013 and 2019, to reach an estimated 790,000. It's believed that 97% of them are engaged in some of the most hazardous work, including clearing land, harvesting cocoa with a machete, or applying agrochemicals on cocoa farms.

My new research paper focusing on certified cocoa farmers in Côte d'Ivoire argues that the real number of child labourers is likely even higher, as measures of child labour may be biased. The results also suggest that certification is not working as intended when it comes to child labour.

Child labour in cocoa

I found that the prevalence of child labour is likely being underestimated by studies conducted by both researchers and the cocoa industry. This is due to a concept called social desirability bias which occurs when people are reluctant to provide completely truthful answers about sensitive topics out of fear of negative consequences.

In the case of child labour on Ivorian cocoa farms, certified farmers may lie about their reliance on child labour as any type of child labour is prohibited by the certification schemes they belong to. Hazardous labour is also prohibited by national legislation.

Fear of legal, social, or economic repercussions is likely leading certified farmers to under report their use of child labour. This is making it harder to accurately measure the scope of the problem and to enact effective policies to fight it.

Sensitive questions

My study relied on a list experiment survey method. It asks respondents about sensitive topics in a more indirect manner than standard surveys.

The prevalence of child labour use estimated using the indirect measure is twice as large as the one from direct questioning. Using list experiments, I find that between 21% and 25% of the surveyed cocoa farmers were relying on child labour during the past 12 months, depending on the type of work involved. This difference suggests that at least half of Ivorian cocoa farmers who use child labour on their certified farms are not willing to admit it.

Why the reliance on children

Main drivers include failures in labour markets, lack of school infrastructure and difficulties in monitoring the use of child labour by certified cocoa farmers, mainly because of the remoteness of the farms.

Cocoa production requires a significant amount of physical labour, as many tasks associated with cocoa farming are not mechanised. Additionally, as cocoa prices in Côte d'Ivoire are fixed seasonally, the only way for farmers to increase their cocoa-generated income is to increase their production. This requires increased labour.

At the same time, Ivorian cocoa farms tend to be clustered in cocoa-growing communities. This means that local adult labour is scarce because most able-bodied adults are employed on their own cocoa farms, and are not seeking labour on other farms.

This labour market failure --- more labourers are needed precisely where they are not available -- results in more cocoa farmers relying on child labour. This phenomenon is even more important when cocoa farms are located in remote communities with difficult access to roads. The reliance on child labour by cocoa farmers is then partly due to adult labour shortages. This finding is further borne out by the fact that the presence of an additional adult in a cocoa-growing household reduced the likelihood of relying on child labour up to 4%.

I also found that the prevalence of child labour is higher on more remote farms, which can be explained by weaker law enforcement in these areas, fewer available adult labourers, and limited opportunity for children to attend school due to a lack of school infrastructure.

Conclusion

Taken together, these findings strongly suggest that child labour rates, and potentially other sensitive subjects, are not being measured accurately. In addition, they show that the issue of child labour remains rampant in Côte d'Ivoire, even on cocoa farms certified as child-labour-free.

Understanding the various reasons behind farmers' continued use of child labour and reluctance to admit that use is an important first step in designing more effective policies. By taking the phenomenon of social desirability bias into account in future research, governments and development partners can lead to more accurate measures of the issue and inform more effective policymaking.

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 

Twitter:         @bullsbears2010

LinkedIn:       Bulls n Bears Zimbabwe

Facebook:      <http://www.google.com/url?q=http%3A%2F%2Fwww.facebook.com%2FBullsBearsZimbabwe&sa=D&sntz=1&usg=AFQjCNGhb_A5rp4biV1dGHbgiAhUxQqBXA> www.facebook.com/BullsBearsZimbabwe

Skype:         Bulls.Bears 

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

National Unity Day

December 22

Christmas Day

December 25

Boxing Day

December 26

Public Holiday in lieu of Boxing Day falling on a Sunday

December 27

Companies under Cautionary

ART

PPC

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

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211004/1c79cb5e/attachment-0001.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image001.png
Type: image/png
Size: 9458 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211004/1c79cb5e/attachment-0002.png>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image002.png
Type: image/png
Size: 409853 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211004/1c79cb5e/attachment-0003.png>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image003.jpg
Type: image/jpeg
Size: 22328 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211004/1c79cb5e/attachment-0001.jpg>