Major International Business Headlines Brief::: 16 September 2022

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Major International Business Headlines Brief::: 16 September 2022 

 


 

 


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ü  World Bank: Global rate hikes could trigger 2023 recession

ü  French air traffic control strike affects thousands of passengers

ü  US mortgage rates hit 14-year high as inflation soars

ü  Pound hits new 37-year low as retail sales slide

ü  First US rail strike in 30 years averted with tentative deal - Biden

ü  Kanye West to end partnership with retailer Gap

ü  Nigeria: Hardship, As Inflation Rate Hits 20.5%, Highest Since 2005

ü  Nigeria: What the Nigeria-Morocco Gas Pipeline Project Will Do for Africa
- Mele Kyari

ü  Nigeria: Lagos-Badagry Road Rehab - Lagos Diverts Traffic At Iyana-Era
Intersection

ü  Kenya: Tea Prices Drop Slightly as Demand Shrinks

ü  Nigeria: Lagos Auctions 134 Vehicles Impounded for Traffic Offences

ü  Nigeria: Why We Suspended Azman Air - NCAA

 


 <mailto:info at bulls.co.zw> 

 


 

World Bank: Global rate hikes could trigger 2023 recession

Interest rate hikes by central banks around the world could trigger a global
recession in 2023, the World Bank has said.

 

Central banks have raised rates "with a degree of synchronicity not seen
over the past five decades" to tackle soaring prices, it said.

 

Raising rates makes borrowing more expensive to try to bring down the pace
of price rises.

 

But it also makes loans more costly, which can slow economic growth.

 

The warning from the World Bank comes ahead of monetary policy meetings by
the US Federal Reserve and Bank of England, which are expected to increase
key interest rates next week.

 

US mortgage rates hit 14-year high as inflation soars

World Bank boss warns of global recession threat

On Thursday, the World Bank said the global economy was in its steepest
slowdown following a post-recession recovery since 1970.

 

It said a study found that "the world's three largest economies - the US,
China and the euro area - have been slowing sharply".

 

"Under the circumstances, even a moderate hit to the global economy over the
next year could tip it into recession," it said.

 

The World Bank also called on central banks to coordinate their actions and
"communicate policy decisions clearly" to "reduce the degree of tightening
needed".

 

Inflation, which is the rate at which prices rise, hit a 40-year-high in the
US and UK in recent months.

 

This was driven by higher demand as pandemic restrictions eased, and as the
war in Ukraine boosted energy, fuel and food prices.

 

In response, central bank policymakers have raised interest rates to cool
demand from households and businesses.

 

However, big rate increases increase the risk of recession as it can cause
an economy to slow.

 

Central banks do not typically run policy decisions by their counterparts.

 

They have in the past, however, coordinated their actions to support the
global economy.

 

In 2007, a global financial crisis was precipitated by a subprime mortgage
crisis in the US.

 

This developed into a full-blown crash after the collapse of the Lehman
Brothers investment bank in September 2008.

 

A month later, the Fed, along with the European Central Bank and central
banks in Canada, Sweden and Switzerland, jointly lowered their key interest
rates.

 

They said in a statement that the "intensification of the financial crisis
has augmented the downside risks to growth and thus has diminished further
the upside risks to price stability".

 

"Some easing of global monetary conditions is therefore warranted," they
added.-BBC

 

 

 

French air traffic control strike affects thousands of passengers

Tens of thousands of passengers are set to be affected by a French air
traffic control strike on Friday.

 

Ryanair has cancelled 420 flights, most of which were scheduled to fly over
France, affecting 80,000 passengers.

 

EasyJet has cut 76 flights, British Airways has cancelled 22, while Air
France said it would only run 45% of its short-haul flights.

 

Separately, on Monday 15% of Heathrow Airport's schedule will be altered
during Queen Elizabeth's state funeral.

 

To ensure the skies over London fall quiet during the events, there will be
flight cancellations, including 100 British Airways flights and four Virgin
Atlantic flights.

 

French strikes

The strike action in France is being taken by the SNCTA air traffic control
union in a row over wages, as inflation soars, and recruitment.

 

Ryanair says all passengers affected have been notified. The low-cost
carrier normally operates more than 3,000 flights per day.

 

Neal McMahon, Ryanair operations director, said it was "inexplicable" that
thousands of European citizens and visitors "will have their travel plans
unfairly disrupted".

 

"It is inexcusable that passengers who are not even flying to or from France
are disrupted," he said.

 

He said French laws protect French domestic flights, but not ones flying
over the country.

 

"It is time that the European Union step in and protect overflights so that
European passengers are not repeatedly held to ransom by a tiny French air
traffic control union," he said.

 

Budget rival EasyJet said it had cancelled flights at the request of French
authorities.

 

EasyJet said: "While this is outside of our control, we would like to
apologise to our customers for any inconvenience they may experience."

 

British Airways said along with the 22 cancelled flights to and from
Heathrow, there could be some extra delays on Friday.

 

Air France is only running 45% of its short and medium-haul flights, and 90%
of long-haul. It has also warned that delays and last-minute cancellations
cannot be ruled out.

 

The flight cuts affect the whole of France, the French civil aviation
authority DGAC said. It added that it was currently working with the
European air travel regulator Eurocontrol to help airlines avoid the
country's air space.

 

Strikes across the aviation industry caused severe disruption to Europe's
summer traffic, including ground and cabin personnel, who are seeking pay
rises to cope with increased living costs amid high inflation.

 

In July, several strikes by firefighters and staff at Paris's Charles De
Gaulle airport led to cancellations and delays.

 

Separately, Heathrow Airport said Monday's flight schedule would change
during the Queen's funeral.

 

Heathrow said that all take-offs and landings on Monday will be delayed for
15 minutes before and after the two-minute silence at the end of the
funeral.

 

Following that, there will be no arrivals between 13:45 and 14:20 during the
procession of the hearse, and no departures between 15:03 and 16:45 for the
ceremonial procession via the Long Walk to Windsor Castle.

 

Between 16:45 and 21:00, departures will be reduced to support the committal
service at St George's Chapel.

 

Flights will also be diverted around Windsor Castle "to minimise noise
during the private family service and interment", it said.

 

The Civil Aviation Authority has issued guidance which means that air
passengers whose flights are cancelled or badly delayed on Monday because of
Heathrow's changes will not legally be entitled to financial compensation.
That is because these are likely to be deemed extraordinary circumstances.

 

However, airlines are offering customers refunds or re-bookings.-BBC

 

 

 

 

US mortgage rates hit 14-year high as inflation soars

The cost of a typical mortgage in the US has hit its highest level since the
2008 financial crisis as the country battles to rein in soaring prices.

 

The average interest rate on a 30-year mortgage hit 6.02% this week, more
than double what it was a year ago.

 

For families hoping to buy a home, the moves compound affordability
problems.

 

The rise comes as the US central bank aggressively raises rates in an effort
to reduce the pressures driving up inflation across the economy.

 

US consumer prices rose by 8.3% in the year to August, the fastest rate in
almost 40 years, the Labor Department said this week.

 

The figure was higher than expected, raising expectations that the Federal
Reserve will continue to raise interest rates aggressively. Mortgage rates
have spiked in anticipation of the moves.

 

"Rates continued to rise alongside hotter-than-expected inflation numbers
this week, exceeding 6% for the first time since late 2008," said Sam
Khater, chief economist at Freddie Mac, the government-sponsored mortgage
firm that released the interest rate data.

 

By raising borrowing costs, policymakers are hoping to lower demand from
businesses and households, thereby reducing the pressures pushing up prices.

 

But in the housing market, while higher rates have slowed sales, property
prices continue to climb.

 

The cost of a typical home in the US was more than $400,000 (£348,000) in
July, up more than 10% from a year earlier.

 

"Although the increase in rates will continue to dampen demand and put
downward pressure on home prices, inventory remains inadequate," Mr Khater
said.

 

The spike in mortgage rates is a stark shift for the housing market in the
US, which has enjoyed relatively low borrowing costs since 2008, when the US
central bank slashed rates during the financial crisis to help prop up the
economy.

 

The Federal Reserve cut rates again when the pandemic hit in 2020, helping
to usher in a period of frenzied home buying with record price increases.

 

That era came to an end in March, when the bank started to raise rates
rapidly, responding to signs that rapid price increases were becoming
entrenched across the economy.

 

Many mortgage brokers and realtors have already announced job cuts in
response to the slowdown.-BBC

 

 

 

 

Pound hits new 37-year low as retail sales slide

The pound has fallen to a new 37-year low against the US dollar after
figures showed UK retail sales fell sharply in August as the rise in the
cost of living continued to hit households.

 

The larger-than-expected drop in sales of 1.6% prompted fresh concerns over
the state of the country's economy.

 

Sales in across all retail sectors fell in August as households cut back in
the face of rising prices.

 

Some analysts suggested retail figures showed the UK is already in
recession.

 

Sterling fell more than 1% against the dollar to $1.13, its lowest since
1985 following the release of the retail sales figures. A weak pound means
Brits travelling overseas will find their spending money will not stretch as
far.

 

This comes at a time when UK inflation, which is the rate at which prices
rise, is running at a near 40-year high, despite slipping to 9.9% from
July's 10.1%.

 

The Bank of England has predicted the UK will fall into recession towards
the end of this year and it is expected to keep increasing interest rates in
a bid to curb inflation.

 

Olivia Cross, assistant economist at Capital Economics, said August's retail
sales figures backed up the consultancy's view that the UK economy is
"already in recession".

 

A recession is defined by the economy getting smaller for two consecutive
three-month periods.

 

"Retail sales will probably continue to struggle as the cost of living
crisis hits harder in the coming months," Ms Cross said.

 

"But nonetheless the Bank of England will still have to raise interest rates
aggressively."

 

Higher prices, along with upcoming energy bill rises in October, have led
households to tighten their belts when it comes to spending.

 

The fall in retail sales continues the slide since the summer of 2021, when
all Covid restrictions were removed, the Office for National Statistics
(ONS) said. The drop seen in August was the largest month-on-month fall
since December 2021.

 

Sales of food, online, non-food and fuel all fell in the month, the ONS
said.

 

Supermarkets' sales volumes also fell by 0.9% in August, but alcohol and
tobacco sales rose by 6.3%.

 

"This is markedly worse than forecasts of a 0.5% fall, and indicates rising
prices and the cost of living crisis is stopping consumers from reaching for
their purse when it comes to extra spending," said Sophie Lund-Yates, lead
equity analyst at Hargreaves Lansdown.

 

Danni Hewson, AJ Bell financial analyst, added people were "clearly thinking
hard about what they spend their money on".

 

"It's just not stretching as far as it used to, and essentials have to come
first. But even essentials are costing more and with the spectre of
unmanageable fuel bills looming large people did the only thing they could,
cut back," she said.

 

"Feedback from retailers suggests that consumers are cutting back on
spending because of increased prices and affordability concerns," the ONS
said.

 

According to the ONS, department stores saw a large drop in sales in August
- 2.7% - while sales in clothing shops fell by 0.6%.

 

"Big ticket purchases are being put off and that's unlikely to change in the
coming months," said AJ Bell's Ms Hewson.

 

On Thursday, John Lewis revealed that while its shopper numbers were higher
than last year, customers were spending less and avoiding buying as many
"big ticket" items.

 

The department store and its supermarket chain Waitrose reported a loss of
£99m for the first half of its trading year. Waitrose said it sales were
down 5% on last year, with basket sizes shrinking by "nearly a fifth".

 

Food prices have been increasing around the world following Russia's
invasion of Ukraine, which has been one of the main factors pushing up
prices at supermarket tills.

 

Meanwhile, the proportion of retail sales online fell to 25.7% in August
from 26.3% in July, but the figure remains significantly above pre-pandemic
levels.

 

This is yet more evidence of how soaring inflation is hitting consumers.

 

Retail sales volumes have seen the biggest decline so far this year and the
figures were far worse than City economists had been expecting.

 

The cost of living crisis is changing our shopping habits and fast. For
instance, this week we've seen Aldi become the fourth biggest supermarket in
the UK for the first time and furniture retailer DFS warn of a downturn in
orders for sofas.

 

For retail, the big question is what impact will the government's recent
energy support package, capping average household bills at £2,500 for the
next two years, have on consumers ability to spend.

 

John Lewis Partnership boss Sharon White thought it could be a "potential
gamechanger" for consumer sentiment. Retailers are also grappling with their
own huge increases in costs and how much of it to pass on to consumers.

 

Right now though, as the industry heads into the all-important Christmas
trading season, consumers are buying less and cutting back on major
purchases to focus on everyday essentials. A difficult winter lies ahead.

 

Ms Cross, of Capital Economics, said that because of the government's Energy
Price Guarantee, which will see annual household energy bills capped at
£2,500 for typical use, any recession would be "smaller and shorter than we
did before".

 

Gas and electricity bills were expected to rise to £3,549 a year and even
higher in 2023, before the government intervened.

 

What the new energy plan means for you

Martyn Beck, chief economic adviser to the EY Item Club, said the government
support for energy bills "should ease both the income squeeze and lift
consumers' sentiment, suggesting the outlook for retailers isn't as gloomy
as could have been the case".

 

"However, real household incomes are still on course for a significant fall
over the next 12 months or so," he added.BBC

 

 

 

 

First US rail strike in 30 years averted with tentative deal - Biden

More than one million Americans worked on the railroads in the 1950s, but
the industry now employs fewer than 150,000 people

US freight rail companies and unions representing their workers have reached
a "tentative agreement" to avert the first national rail strike in 30 years.

 

The deal follows months of back and forth negotiations and 20 hours of
overnight talks on working conditions.

 

President Joe Biden hailed the outcome as "an important win for our economy
and the American people".

 

The strike would have impacted millions of Americans and cost the economy an
estimated $2bn (£1.7bn) a day.

 

It would also have disrupted passenger services, as many of these trains run
on tracks that are operated and maintained by freight carriers.

 

The agreement, which was announced early on Thursday, ensures that a strike
that had been due to begin after midnight on Friday will no longer take
place.

 

The deal includes a 24% wage increase and $5,000 bonuses, as well as changes
to existing policies on time off which had been a crucial sticking point for
workers.

 

"This is a win for tens of thousands of workers and for the dignity of their
work," Mr Biden said at a news conference. "They earned and deserve these
benefits, and this is a great deal for both sides."

 

"We reached an agreement that will keep our critical rail system working and
avoid disruptions of our economy," he added.

 

 

Heated contract negotiations have been taking place for three years between
railroad management and the dozen unions that represent more than 100,000
workers.

 

Ten unions had agreed to the most recent contract offer, but until Thursday
two of the largest unions in the country - representing the engineers and
conductors who make up two-person train crews - held out.

 

They complained that staffing shortages and workplace attendance policies
have created punishing schedules for staff.

 

Workers say they are effectively on call throughout the year, with no paid
time off in some cases even if they are unwell or have other personal
emergencies.

 

More than one million Americans worked on the railroads in the 1950s, but
the industry now employs fewer than 150,000 people, according to data from
the Bureau of Labour Statistics.

 

Cost-cutting has led to the culling of some 45,000 jobs over the last six
years, putting pressure on those who have remained in their jobs.

 

Analysts had warned a strike would result in supply chain chaos and cost the
economy more than $2bn a day. In anticipation of service interruption, the
Amtrak passenger rail service cancelled all of its long-distance services
around the country for Thursday.

 

The resolution of the conflict brought widespread relief as many firms
continue to grapple with supply chain woes and had been braced for further
disruption.

 

"We're really excited about the progress," Ford chief executive Jim Farley
told the BBC after the deal was announced. "Any delay, like a real strike,
even for a day or two will have a tremendous impact on an industrial company
like Ford. And even if it only lasts for, you know, hours or a day could it
could have impacts for weeks to come."

 

President Biden personally called rail unions and companies to try to broker
a compromise earlier in the week. Labour Secretary Marty Walsh, a former
union leader himself, secured the deal after the marathon talks.

 

The two holdout unions, BLET and Smart, credited the duo and other Democrats
for "allowing for an agreement to be reached across the bargaining table,
rather than through legislation".

 

"The solidarity shown by our members, essential workers to this economy, who
keep America's freight trains moving, made the difference," it added.

 

The agreement will now go before union members for a ratification vote.

 

The parties have also agreed that, if the vote fails, there will be a
"cooling off period" before any strike action is taken.-BBC

 

 

 

 

Kanye West to end partnership with retailer Gap

The rapper Kanye West is to end a once celebrated partnership with the
retailer Gap, which had hoped the collaboration could breathe new life into
its brand.

 

Mr West accused the firm of failing to honour terms of the deal, including
by failing to open standalone stores for his Yeezy fashion label.

 

The agreement with Mr West, who goes by Ye, was hailed as potentially
transformative when announced in 2020.

 

But there have been signs of strain.

 

The first item produced under the partnership, a $200 (£173) puffa jacket,
did not go on sale for a year. That led to reports that Gap was frustrated
by the slow rollout of Yeezy products, which also included a plain hoodie in
bright colours for $90.

 

Mr West, meanwhile, has repeatedly criticised the company on social media,
accusing it of copying his designs, excluding him from meetings and ignoring
his requests to join the board.

 

Gap, which has faced its own internal struggles including the firing of its
chief executive this summer, declined to comment.

 

But in an email to staff seen by the BBC, its president and chief executive
Mark Breitbard said that while Gap and Yeezy shared many values, "how we
work together to deliver this vision is not aligned".

 

"Important to know is that throughout this partnership, we have upheld our
commitments - and the teams have done so with the utmost integrity,
navigating obstacles and demonstrating incredible resolve," he added.

 

Mr West's lawyer, Nicholas Gravante, said Mr West had tried to work through
the issues with Gap but "gotten nowhere". He sent a letter on Mr West's
behalf to Gap notifying it of his intent to end the deal on Thursday.

 

"Gap left him no choice but to terminate their agreement," he said. "Ye will
now promptly move forward to make up for lost time by opening Yeezy retail
stores."

 

Mr West, who made his name as a rapper in the 2000s before branching out
into fashion, has long had high ambitions for Yeezy, which is known for its
sell-out trainers, foam sliders and boxy, oversized clothes in colours like
beige and black.

 

The company, which is owned by Mr West, was valued at $2.9bn in 2020 when
the 10-year deal with Gap was announced.

 

Since then, the two companies have teamed up with high-end fashion label
Balenciaga. The recent results of that collaboration - a series of black
t-shirts, hoodies and anoraks - generated buzz when they went on sale this
summer out of what looked like large trash bags.

 

That partnership is governed by a separate agreement, according to the
letter sent on Mr West's behalf to Gap.

 

Mr West also has a partnership with Adidas, which is due to expire in
2026.-BBC

 

 

 

 

Nigeria: Hardship, As Inflation Rate Hits 20.5%, Highest Since 2005

Nigerians are gasping for breath as the inflation rate rose by 0.92 basis
points to 20.52 per cent in August from 19.6 per cent in July, the highest
since October 2005.

 

This represents the seventh consecutive monthly rise in Headline inflation
since February. Food inflation also rose to 23.12 per cent in August 2022,
representing a 1.1 percentage-point increase compared to 22.02 per cent
recorded in the previous month.

 

In its Consumers Price Index, CPI, report for August, the National Bureau of
Statistics (NBS) said the "increases were recorded in all divisions that
yielded the headline index".

 

The Bureau stated: "In August 2022, on a year-on-year basis, the headline
inflation rate was 20.52 per cent. This was 3.52 percentage points higher
compared to the rate recorded in August 2021, which was 17.01 per cent.

 

"This shows that the headline inflation rate increased in the month of
August 2022 when compared to the same month in the preceding year (August
2021). On a month-on-month basis, the Headline inflation rate in August 2022
was 1.77 per cent, this was 0.05 per cent lower than the rate recorded in
July 2022 (1.82 per cent)."

 

 

On food inflation, NBS further reported: "The food inflation rate in August
2022 was 23.12 percent on a year-on-year basis; which was 2.82 percent
higher compared to the rate recorded in August 2021 (20.3 percent).

 

"This rise in food inflation was caused by increases in prices of bread and
cereals, food products, potatoes, yam, and another tuber, fish, meat, oil,
and fat. On a month-on-month basis, the food inflation rate in August was
1.98 percent, this was a 0.07 percent decline compared to the rate recorded
in July 2022 (2.04 percent). This decline is attributed to a reduction in
prices of some food items like yam tubers, garri, local rice, and
vegetables."

 

 

In addition to the reasons advanced by NBS, several experts who spoke to
Vanguard listed other inflationary pressure points, while recommending some
solutions.

 

Monetary policy not enough -- Uwaleke

 

Professor of Capital Market at Nasarawa State University, Keffi, Uche
Uwaleke, reacting to the rise in inflation by 20.52% the highest in two
decades, said: "The increase in headline inflation above the psychological
threshold of 20% did not come as a surprise in view of the rising inflation
trend in many economies, partly caused by the Russian-Ukrainian conflict.

 

"It's interesting to note that the NBS, in its latest CPI report, provided a
clue as to the major factors driving the inflationary pressure in Nigeria,
namely supply disruptions and rising cost of production. In the light of
this revelation, what becomes clear is that the recent monetary policy
tightening stance of the CBN alone may not address the challenge. The
government needs to formulate and implement complementary fiscal policies
aimed at boosting food supply as well as reducing firm's cost of
production."

 

 

Rise in MPR a major concern -- Kurfi

 

In his reaction, analyst and Chief Executive Officer, APT Securities & Funds
Limited, Mallam Garba Kurfi, said: "I am not surprised with the outcome but
I hope it will not further go up as harvesting of our agricultural products
will likely push the food cost down. Equally the price of other foods,
especially, wheat is globally coming down. We are expecting inflation to
fall before the end of the year. But of more concern is the increase of the
Monetary Policy Rate, MPR, in the last two consecutive sittings of the
Monetary Policy Committee, MPC. We hope the monetary authorities will keep
the rate the same for the rest of the year."

 

Supply side factors, forex drive inflation --Olayinka

 

Reacting as well, analyst and CEO, Wyoming Capital and Partners, Tajudeen
Olayinka, said: "20.52% inflation number for the month of August 2022, is an
indication that demand-side management tools being deployed by CBN to tame
inflation in Nigeria may actually be aggravating the situation, given the
fact that most of the factors responsible for inflation in Nigeria are
traceable to the supply side of the economy. These supply side factors had
been there and largely unresolved before the emergence of imported inflation
that came as a result of the Russian war on Ukraine.

 

"Foreign exchange scarcity and exchange rate mismanagement; unending
insecurity and limited access to farms; crude oil theft and inability to
meet OPEC production quota; high cost of raw materials; infrastructure
deficit; highly elevated cost of capital in the economy are some of the
dangerous factors bedeviling Nigerian economy. So, it will be difficult for
CBN's demand side management tools to solve the problem. Unfortunately, the
fiscal side is weak, with no positive contribution to make at this time,
other than to engage in excessive borrowing and fiscal rascality. That is
also driving up inflation."

 

He further said: "This is not to say CBN is not aware of possible failure of
its demand side management tools, or that raising interest rate will not
sufficiently address the current inflationary pressure, but because it must
also act to address possible threats of reversal of capital flow, arising
largely from interest rate hike in Europe and America. These are the
issues."

 

To solve the inflation rate problem, Olayinka, said: "So, solving this
problem requires that global inflationary threat is dealt with by the more
advanced economies, while Nigeria's fiscal authority continues to search for
solutions to supply side problems it created. Impact of high inflation is
better imagined than real; more people are now being dragged into poverty
because of poor purchasing power; unemployment will rise as a result. This
will further hurt the economy."

 

NLC seeks cost of living allowance

 

Meanwhile, President of Nigeria Labour Congress, NLC, Ayuba Wabba, has
demanded for payment of cost of living allowance to workers and others to
cushion the effects of the rising inflation.

 

According to him, "the high inflation is a pointer to the fact that the
economy is not healthy. It also clearly shows the level of the challenge of
the economy.

 

"Basically, it is also the evidence that the cost of goods and services
especially foods and every item has gone haywire. It is a reflection of also
the value of our currency. The value of our currency has continued to be on
a free fall and all of this put together is what is reflected in the
inflation data released. With all of these, it is the workers that are on
fixed wages that are at the receiving end and basically, we now have a pool
of the working poor because of the fact that it is difficult for people to
have ends meet.

 

"The facts are very obvious. To me, it is even an understatement to say that
it is at the level of 20 percent especially.

 

Two days ago, I went to buy a loaf of bread in Abuja, a bread that used to
be N250 moved to N500. Now, a loaf of bread is now N800/900. So, imagine
somebody on N30, 000; how does he survive? It is really a difficult
situation, that is why many countries around the world are paying what they
called cost of living allowances and we have urged the government to look at
it. Ghana recently paid 15 percent, South Africa paid to all workers some
percentage to cushion the challenge of hyperinflation in the system which
has also resulted to the high cost of living."

 

Suspend new taxes, levies --NECA

 

Reacting, the Nigeria Employers' Consultative Association, NECA, urged the
government to suspend all forms of new taxes and levies to give a respite on
the spiking production cost to tackle the rising inflation.

 

Speaking through its Director-General, Mr Wale Oyerinde, NECA contended that
"it is apparent that the government's intervention so far has not impacted
the inflationary pressures that have kept rising.

 

He stated: "Around the globe, concerns about inflation have led many
countries to consider an aggressive approach towards slowing down the
economy. Consumers are also beginning to think twice about spending on goods
and some services. In Nigeria, it is apparent that the government's
intervention so far has not impacted the inflationary pressures that have
kept rising. Rather, some of these interventions have been
counterproductive. The recently announced 20.52 percent inflation rate
affirms the need for Government to take a second look at current strategies
aimed at flattening the curve.

 

"The key drivers of inflation which includes, worsening currency
depreciation, escalating transportation cost, high import duty on
manufacturing inputs, security concerns among others have continued to crowd
out the government's interventions.

 

It leaves us to wonder whether these interventions are truly right for our
peculiar challenges. With the crisis between Russia and Ukraine, the rising
cost of energy around the world has translated to a significant uptrend
being witnessed in most economies as prices of goods and services have
reached unprecedented levels.

 

"To tackle inflation, all forms of new taxes and levies should be suspended
to give a respite on the spiking production cost. There should also be
deeper stakeholder engagements across sectors to develop an enduring
strategy on the way forward. The federal government like its counterpart in
other climes must be responsive and deliberate in its efforts to flatten the
inflationary pressures."

 

Govt policies fuelling inflation--NAGAFF boss

 

Reacting, former National President of National Association of Government
Approved Freight Forwarders, NAGAFF, Eugene Nweke, has blamed the Federal
Government's economic policy for the sharp rise in inflation rate.

 

Speaking with Vanguard on the inflationary situation Nweke said the
inflation rate rise will further force companies in the maritime sector to
close shops or down-size their workforce.

 

He said: "The closure of companies will further drive more citizens into
poverty. Already the sector is struggling and the government policies are
not helping. The ports being the gateway for trading and most goods imported
are consumables; The scarce foreign exchange will drive up the cost of goods
which will in turn drive up inflation."

 

-Vanguard.

 

 

 

 

Nigeria: What the Nigeria-Morocco Gas Pipeline Project Will Do for Africa -
Mele Kyari

The Nigeria-Morocco Gas Pipeline Project is an initiative of the Federal
Government of Nigeria and the Kingdom of Morocco.

 

The Group Chief Executive Officer of the Nigerian National Petroleum Company
Ltd, Mele Kyari, on Thursday said the Nigeria-Morocco Gas Pipeline Project
will create wealth, and improve the standard of living of countries with the
African region.

 

Mr Kyari said this during the signing ceremony of the Nigeria-Morocco Gas
Pipeline Project Memoranda of Understanding.

 

The agreements were between

 

NNPC, ONHYM and ECOWAS;

 

 

NNPC, ONHYM and SMH; and

 

NNPC, ONHYM and PETROSEN

 

ONHYM is the National Office of Hydrocarbons and Mines of Morocco.

 

At the event which was held in Morocco, Mr Kyari said the gas pipeline
project will also help in the mitigation against desertification and other
benefits that will accrue as a result of reduction in carbon emission.

 

He described the event as a very important milestone in the Nigeria-Morocco
Gas Pipeline project as it reaffirms the commitment of stakeholders to
deliver on the project.

 

He explained further that the NNPC is well positioned to progress the
project by leveraging on its experience and technical capabilities ranging
from gas production, processing, transmission and marketing as well as the
country's vast experience in executing major gas infrastructure projects in
Nigeria.

 

 

>From inception of the project to this stage, Mr Kyari said concerted efforts
have been made by the Government of Nigeria and the Kingdom of Morocco which
led to the very commendable achievements recorded.

 

He expressed appreciation to King Mohammed VI of Morocco and President
Muhammadu Buhari for entrusting NNPC Ltd with this strategic project.

 

He said, "As you are aware, our countries stand to benefit immeasurably from
the execution of the project which extends beyond the supply of gas to
energize the countries along the route.

 

"Some of the benefits include creation of wealth and improvement in standard
of living, integration of the economies within the region, mitigation
against desertification and other benefits that will accrue as a result of
reduction in carbon emission.

 

"I am glad to say that NNPC is well positioned to progress the project by
leveraging our experience and technical capabilities ranging from gas
production, processing, transmission and marketing as well as our vast
experience in executing major gas infrastructure projects in Nigeria.

 

 

"On our part, NNPC Limited will facilitate the continuous supply of gas
provide other enablers such as the required land for the first compressor
station for the pipeline to be deployed in Nigeria which is among the
thirteen stations earmarked along the pipeline route.

 

"On behalf of the Federal Government of Nigeria, I would like to thank you
all as we continue to strengthen our partnership for the benefit of our
countries."

 

The Nigeria-Morocco Gas Pipeline (NMGP) Project is an initiative of the
Federal Government of Nigeria and the Kingdom of Morocco and was conceived
during the visit of King Mohammed VI of Morocco to Nigeria in December 2016.

 

The NMGP Project is aimed at monetization of Nigeria's abundant natural gas
resources, thereby generating additional revenue for the Country,
diversification of Nigeria's gas export routes and elimination of gas
flaring.

 

It will also assist in supplying gas to Morocco, 13 ECOWAS countries and
Europe, integration of the economies of the Sub-region,

 

improvement of living standards of people of the Sub-region, creation of
wealth and poverty alleviation, assisting in the fight against
desertification through sustainable and reliable gas supply as well as
providing avenue for other countries along the pipeline route to develop and
export their gas.

 

The pipeline is a 48 Inch X 5,300 Km (Offshore from Barss Island-Nigeria to
Dakhla-Morocco) and 56" X 1,700 Km (onshore from Dakhla-Morocco to MEP),
with a total length of about over 7,000 Km and about thirteen Compressor
Stations.

 

The pipeline will originate from Brass Island (Nigeria) and terminates at
North of Morocco, where it will be connected to the existing Maghreb
European Pipeline (MEP) that originates from Algeria (via Morocco) to Spain.

 

-Premium Times.

 

 

 

Nigeria: Lagos-Badagry Road Rehab - Lagos Diverts Traffic At Iyana-Era
Intersection

The Lagos State Government has announced plans to divert traffic at the
Lagos-Badagry/Iyana Era intersection from Saturday, September 17 to Sunday
18, 2022, for the rehabilitation project.

 

The project is continuation of the ongoing rehabilitation of the Iyana Era
Road in the Ojo Local Government Area of the state.

 

A statement by the Commissioner for Transportation, Dr. Frederic Oladeinde
explained that motorists inbound Lagos will be diverted into the Badagry
bound lane to link back to the Lagos bound lane after the barricaded section
of the road as the proposed traffic diversion is to correct the failed
asphaltic pavement.

 

Oladeinde stated further that motorists from Iyana Era will also be diverted
into the Badagry bound lane, assuring that personnel of the Lagos State
Traffic Management Authority will be deployed to manage the traffic flow in
the axis.

 

While adding that signage will be mounted along the route to guide motorists
as well, Oladeinde, however, appealed to the motoring public to cooperate
with the traffic management team to minimise inconveniences resulting from
the planned rehabilitation works on the road.

 

-Vanguard.

 

 

 

 

Kenya: Tea Prices Drop Slightly as Demand Shrinks

Nairobi — Tea prices at the weekly Mombasa auction dipped slightly this week
amid decreased demand for the commodity.

 

At this week's auction, a kilo averaged USD2.24(Sh269.92) down from
USD2.28(Sh274.74) last week.

 

During the auction, the total volume traded was 69,086 kilos less than last
week, the East African Tea Trade Association (EATTA)notes, signaling reduced
demand for the commodity.

 

"There was good general demand at irregular levels for the 185,440 packages
(12,188,298.00 kilos) available for sale. 123,280 packages (8,088,644.00
Kilos) were sold with 33.52 per cent of packages remaining unsold," said
EATTA managing director Edward Mudibo.

 

In the trading session, there was more and strong support from Egyptian
Packers, Yemen and other Middle Eastern countries while Pakistan Packers
were active but at lower levels.

 

"Bazaar showed reduced enquiry while UK and Afghanistan maintained interest
with Sudan, Kazakhstan and other CIS states more selective," said Mudibo.

 

Russia, Iran, and Local Packers were less active. Somalia maintained
activity at the lower end of the market.

 

-Capital FM.

 

 

 

 

Nigeria: Lagos Auctions 134 Vehicles Impounded for Traffic Offences

The Lagos State Taskforce has auctioned 134 vehicles confiscated for various
traffic offences.

 

Gbadeyan Abdulraheem, the Taskforce spokesperson, said in a statement on
Thursday that the enforcement team in collaboration with the Lagos State
Ministry of Justice "auctioned 134 forfeited and abandoned vehicles at the
Taskforce compound in Alausa, Ikeja."

 

Mr Abdulraheem said the vehicles were seized for various traffic offences
ranging from driving on one-way to willful obstruction of traffic flow
across various parts of the state.

 

 

The exercise, he said, was witnessed by members of the public.

 

The Taskforce chairperson, Shola Jejeloye, said that he does not determine
the fate of seized vehicles.

 

"My role as a police officer is to carry out enforcement exercises, one of
which is confiscation of vehicles for traffic offences, and handing them
over to the mobile court for judgement. I don't determine the fate or
outcome of any vehicle brought before the magistrate in court," Mr Jejeloye
was quoted as saying.

 

"Some of the cars being auctioned here were confiscated for obstruction of
traffic which only attracts a fine but some people never showed up to claim
these cars that's why they have been forfeited to the State Government after
the stipulated period and then auctioned."

 

Mr Jejeloye urged members of the public to desist from committing crime or
traffic offences "as no one would be spared if found wanting."

 

He warned that this exercise would serve as a deterrent to other road users
who flout traffic law, adding that they would be made to face the
consequences.

 

At the event, the Lagos State Special Offenses Mobile Court, coordinator,
Arinola Ogbara-Banjoko, described the exercise as "seamless and well
organised." He said that all the vehicles on display had gone through due
process of the court of law before being forfeited to the state government
for varying offences.

 

-Premium Times.

 

 

 

Nigeria: Why We Suspended Azman Air - NCAA

Vanguard (Lagos)

The Nigerian Civil Aviation Authority, NCAA, has yesterday, withheld Azman
Air Transport License, ATL, pending when the airline provides required
documentation for its operational licenses renewal and sign a Memorandum of
Understanding on how it would remit over N1.2bn legacy debt accrued from
collection of Passenger Service Charge, PSC.

 

An ATL is issued as authorisation to airlines to provide scheduled and
non-scheduled services. It is one of the licenses received by airlines
before they can commence operation just as they await the Air Operator
Certificate, AOC, that fully guarantees them the right to begin air
services. Without ATL the AOC becomes invalid.

 

 

Vanguard Aviation World, gathered that the suspension would affect travel
through the northern part of the country as Azman is the major carrier along
that route.

 

The development will impact capacity on other route within the country
negatively.

 

It was also gathered that the indefinite suspension is coming barely two
months after the suspension of Dana Airlines on July 20, 2022, in pursuant
to Section 35(2), 3(b) and (4) of the Civil Aviation Act, 2006 and Part
1.3.3.3(a)(1) of the Nigeria Civil Aviation Regulations (Nig.CARs), 2015.

 

Also, in same month, Aero Contractors suspended its flight operations, due
to its inability to sustain daily operations as a result of hike in Jet A1,
along with other financial constraints.

 

Following the suspension, a total of three domestic airlines operating 23
aircrafts are not in operation, thus creating more passenger traffic in the
country.

 

 

There were also indications that domestic flight movements would be
threatened, following the grounding of three airlines operations over
capacity in the past three months.

 

While Dana Airlines and Azman Air were suspended by the NCAA, Aero
Contractors suspended its operations indefinitely following economic
realities.

 

The development has impacted travels significantly, as the suspensions have
reduced the number of aircraft in operations to 36 from 123, with grounded
aircraft currently at 87.

 

This recent grounding could cause airfares to skyrocket as the issue of
scarcity of aviation kerosene, also known as Jet A1 led to the surge in
airfares across the country some few week ago, which may force passengers to
pay more.

 

Why we suspended Azman Air -- NCAA

 

 

While confirming the suspension, NCAA Director General, Captain Musa Nuhu,
noted that the move is not particularly aimed as Azman but that all indebted
airlines would need to comply with these rules to enable them renew their
ATL.

 

He said:"Azman Air must provide Tax Clearance as one of the documentation
for its ATL and must sign the MOU to negotiate its debt remittance which is
part of the N42 billion and $7.8 million debt in PSC.

 

"This is not a charge and this is not their money, it's monies collected in
trust for us from passengers and they squandered it. We are not asking them
for an interest rate, no penalties, we just want our funds remitted. We
asked them to sit and negotiate as they collected on our behalf and refused
to remit.

 

" I cannot keep explaining to the Minister, to the Accountant General, to
the Presidency why we cannot remit money meant for them to them. We have
been forced to carry out this action.

 

"Everyone is having challenges, difficulties and this is not restricted to
the industry stakeholders alone, the airlines, ground handlers and other
service providers as even the agencies have the same problem in the issues
of funds.

 

"We know that if we tell them to give us all these monies at the same time,
it is very difficult and not possible, so, what we have put in place in NCAA
and to prevent the debts from growing, we have put in place a tripartite
agreement; the NCAA, airlines and the airlines' banks. So, once those funds
go to the bank, the 5 per cent TSA/CSC is automatically deducted and goes
into the NCAA bank and NCAA will share it with the other sister agencies on
a pre-determined ratio as entrenched in the 2006 Civil Aviation Act.

 

"What we have said is that if they don't pay this legacy debt, we are not
going to renew their licenses; AOC, ATL. That is one of the conditions and
most of them have entered into the agreement."

 

Northern route heavily impacted -- Experts

 

Meanwhile, stakeholders in the industry have lamented that the development
would impact travellers utilizing the northern route.

 

According to aviation experts, Mr. Olumide Ohunayo, "Nigeria is losing
capacity on a daily basis, and the northern routes will be mostly affected
by the suspension of Azman Air because that is their area of strength.

 

"They have been there for years, connecting the northern routes through
Abuja, Lagos, amongst others. The region will feel the impacts more. Here we
are talking about route where ticket fares are around N150, 000 to N200, 000
and with this development, I fear the airfare will jump to N250, 000 or even
more.

 

"At some point passengers might be scrambling for seats at the airports
which will be taking us back to those old days that we never prayed to
return.

 

"I think it is time for the management NCAA and the Ministry of Aviation to
remove pride and release Nigeria's Eagles AOC, belonging to AMCON, which has
three aircrafts to join the market and operate. You cannot keep three
aircraft down there and we are losing capacity daily. Apart from this, there
is the issue of employment, as staff will not be paid or be asked to go
home.

 

"Also, some of the airports that Azman is moving to, the shops within,
service providers, taxi operating amongst others will also not operate. Down
the line, there will be losses for everybody, even the agencies will be
impacted too. The market is tough at the moment.

 

Also, the Principal Managing Partner Avaero Capital, Sindy Foster, noted
that, the level of capacity in the sector is dire.

 

She said: "Dana was suspended by the regulator, but are planning to come
back. Aero voluntarily suspended their services, and it appears that Azman
has voluntarily suspended operations whilst they renew their AOC.

 

"The withdrawal of services from three airlines significantly reduces the
amount of bookable seats and will yet again lead to increased fares if there
continues to be a mismatch of supply and demand.

 

"The NCAA recently announced they would not renew the ATL and AOC of
indebted airlines, so we can expect to see more voluntary and involuntary
suspensions down the line. As this is a financial crisis, it can be remedied
by cash injections into the airlines. This is not just a Nigerian cash
liquidity issue.

 

"Other airlines are issuing shares, attracting private equity investment, or
are utilising other creative ways of recapitalisation which are not easy in
this environment, where company accounts and valuations are not as
transparent or confidence rendering as they might be."

 

 

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2022

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

National Unity Day

 

December 22

 


 

Christmas Day

 

December 25

 


 

Boxing Day

 

December 26

 


Companies under Cautionary

 

 

 


CBZH

Meikles

Fidelity

 


TSL

FMHL

Turnall

 


GBH

ZBFH

GetBucks

 


Zeco

Lafarge

Zimre

 


 

 

 

 


 <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
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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
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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) 2022 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
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