Major International Business Headlines Brief::: 21 March 2023
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Major International Business Headlines Brief::: 21 March 2023
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ü Sri Lanka: $2.9bn IMF bailout for struggling economy
ü Investor fears appear to ease as UK and US share prices rise
ü Amazon to cut another 9,000 jobs
ü 'Famous' Darlington shop for sale after closure announced
ü 'Brewkery' social enterprise plans to expand
ü Kenyan Opposition Leader Calls for Weekly Rallies Over Cost-of-Living Crisis
ü South Africa: Eskom Will Resolve Power Crisis - Electricity Minister
ü Mozambique Submits First Assessment Report to Exit the 'Grey List'
ü Africa's Deepening Unemployment Crisis
ü Ethiopia Is One of Recent Examples of Resilience in Face of Multiple Shocks, Finance Minister Says
ü South Africa: Electricity Minister Visits Eskom Power Stations
ü Flying Popularity Continues to Rise in Africa
ü Ex-Norwegian Air Boeing 787 Dreamliners Hit Scrap Heap After Just Ten Years
ü Reserve Bank expected to hike rates again
ü Gold drops from 1-year peak as banking fragility drives wild swings
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Sri Lanka: $2.9bn IMF bailout for struggling economy
Sri Lanka has secured a $2.9bn (£2.3bn) bailout from the International Monetary Fund (IMF) as it faces its worst economic crisis since independence.
The deal has been nearly a year in the making and a lifeline for the country that has billions of dollars in loans.
Foreign minister Ali Sabry told the BBC the government will raise funds by restructuring state-owned enterprises and privatising the national airline.
However, analysts warned Sri Lanka still faces a tough road ahead.
The country's economy has been hit hard by the pandemic, rising energy prices, populist tax cuts and inflation of more than 50%.
Why is Sri Lanka in crisis?
The daily heartbreak of life in a country gone bankrupt
A shortage of medicines, fuel and other essentials also helped to push the cost of living to record highs, triggering nationwide protests which overthrew the ruling government in 2022.
Three-wheelers queue to buy petrol due to fuel shortage, amid the country's economic crisis, in Colombo, Sri Lanka, in July.
Queues for fuel snaked along Colombo's streets at the peak of the fuel shortage last July
As a result the country defaulted on its debts with international lenders last May for the first time in its history.
"We have lived beyond our means. Whether we like it or not, these difficult measures which may be very unpopular need to be taken," Mr Sabry said in an interview before the funding was announced.
"Luckily, most [people] other than politically-motivated unions have understood that. I know they are not happy, but they also understand we have no choice," Mr Sabry added.
Earlier this year the country introduced income taxes for professionals, ranging from 12.5% to more than 36%.
It also raised other taxes to pay for critical purchases, including fuel and food.
This is in stark contrast from the big tax cuts former Sri Lanka president Gotabaya Rajapaksa introduced in 2019, which lost the government income of more than $1.4bn (£1.14bn) a year.
Can Sri Lanka trade its way back to prosperity?
Sri Lanka's children go hungry as food prices soar
Andrew Wood, analyst at the S&P Global Ratings agency, said: "Sri Lanka still faces a long road toward consolidation of its government balance sheet, consistent economic growth, and external stability.
"We expect the economy to contract again in 2023, albeit at a more modest pace, before returning to growth in 2024."
Earlier this month, the IMF said Sri Lanka had secured financing assurances from all its major creditors, including China and India, which paved the way for the bailout.
Mr Sabry said it was "a little premature" to discuss if China - Sri Lanka's biggest bilateral lender - would consider writing-off some of the country's debts.
"We have the will to pay, but we don't have the capacity to pay. What we are now trying to do is get that capacity back," he said.
"That's going to be a very difficult and serious discussion."
The Sri Lankan government had initially hoped to agree a new payment plan with China and India by the end of 2022.
Beijing's lending to Sri Lanka stands at around $7bn (£5.71bn) while India is owed around $1bn (£820m).
-BBC
Investor fears appear to ease as UK and US share prices rise
Fears in financial markets appeared to ease, a day after regulators agreed a rescue deal for troubled lending giant Credit Suisse.
The bank was bought by rival UBS on Sunday after regulators worked around the clock to secure the takeover.
Along with the collapse of two smaller US banks, its struggles had sparked fears over the global financial system.
Hope that the deal would help contain the crisis helped lift shares in Europe and the US.
London's FTSE 100 closed up roughly 0.9%, recovering ground after early losses. Major indexes in Europe also ended higher, with UBS climbing roughly 1.5% by the end of the day.
In the US, the three major exchanges also gained,despite worries about another regional bank, First Republic.
Shares in the San Francisco-based firmsank more than 40%,as the injection of funds by 11 of America's biggest banks last week failed to restore confidence in the bank's future.
There were reports of another effort to stabilise the bank - which has seen shares plunge as customers transfer their money - as authorities sought to keep the crisis contained.
Shares of some other banks in the US and Europe also remained under pressure.
In the UK, a spokesperson for Prime Minister Rishi Sunak aimed to reassure investors saying UK banks were "safe and well capitalised" after the emergency rescue of Credit Suisse.
It came after central banks around the globe made similar comments.
Six central banks, including the US Federal Reserve, also announced they would boost the flow of dollars in the global financial system to make sure banks had easy access to cash.
Is this a banking crisis - how worried should I be?
Central banks to boost flow of US dollars
Despite the panic, experts do not expect a repeat of 2008 when banks stopped lending to each other. The situation was so dire then it sparked a global recession.
Banks have been struggling with the recent rise in interest rates which has left some sitting on substantial losses.
It led to the collapse of Silicon Valley Bank and Signature Bank - two medium sized lenders - in the US last week and sparked concerns other banks could get into trouble.
Credit Suisse - which had been loss-making for some time but which was otherwise well capitalised - has been hit by this crisis of confidence.
The 167-year-old institution is one of around 30 banks worldwide deemed too big to fail because they are of such importance to the banking system.
Switzerland's second largest lender, which has struggled with a string of scandals over the last few years, was sold to UBS at just over $3.15bn (£2.6bn), a fraction of its $8bn price tag on Friday.
Mark Yallop, the former UK chief executive of UBS, said the deal "should" do the job of reassuring investors.
"This is a takeover of a challenged institution with particular idiosyncratic problems that relate to it specifically [and are] not reflective of broader issues in the banking markets," he told the BBC's Today programme.
Axel Lehmann (L), Chairman Credit Suisse, speaks next to Colm Kelleher (R), Chairman UBS, during a press conference in Bern, Switzerland
,EPA
,
The chairmen of both banks spoke at a news conference in Bern on Sunday
UBS chairman Colm Kelleher described said it would wind down Credit Suisse's investment banking operations but that it was "too early" to say what would happen about jobs.
Credit Suisse has around 74,000 staff, around 5,000 of them in the UK.
"We need to do this in a rational way thoughtfully, when we've sat down and analysed what we need to do," he said.
Cost of living: Tackling it together
Ordinary people have little reason to fear for their funds.
In the highly unlikely scenario that a bank or building society actually collapses, then deposit protection is in place.
In the UK, that means £85,000 per person, per institution is protected (or £170,000 in a joint account).
So, if you have £85,000 in one bank, and another £85,000 in a separately licensed bank, then it is all safe if both went bust, under the Financial Services Compensation Scheme.
There is also a higher temporary limit of £1m for six months, if you get a sudden influx of funds, such as an inheritance.
Protection is similar in the EU, and the US government has safeguarded deposits of up to $250,000 for a long time.-bbc
Amazon to cut another 9,000 jobs
Online retail giant Amazon plans to cut another 9,000 jobs as it seeks to save costs.
The firm, which employs 1.5 million people worldwide, said the cuts would fall mainly in areas including cloud computing and advertising.
It did not say which countries would be affected but said the positions would be closed in the next few weeks.
Boss Andy Jassy said it was a "difficult decision" but it would be best for the company in the long term.
The firm already axed 18,000 jobs in January.
Mr Jassy said that in recent years, most areas of Amazon's business had been adding roles.
"However, given the uncertain economy in which we reside, and the uncertainty that exists in the near future, we have chosen to be more streamlined in our costs and headcount," he continued.
Like many tech giants, Amazon saw sales boom during the pandemic when customers were stuck at home.
But more recently its sales have slowed down as consumers spend less due to the cost of living crisis.
Other companies, including Google and Facebook-owner Meta, have been grappling with how to balance cost-cutting measures with the need to remain competitive.
Last week Meta, which also owns Instagram and WhatsApp, announced plans to cut 10,000 jobs.
Mr Jassy said it is "never easy" to lose employees, adding: "To those ultimately impacted by these reductions, I want to thank you for the work you have done on behalf of customers and the company."
Another area that will see cuts is Twitch, a livestreaming platform for content including gaming and music.
It comes days after Emmett Shear announced he would be stepping down as Twitch's chief executive officer after 16 years in post.
Amazon bought Twitch for $1bn (£1.5bn) in 2014.-bbc
'Famous' Darlington shop for sale after closure announced
A shop described as Darlington's most "famous" has gone up for sale after its 79-year-old owner called time.
Guru Boutique in Blackwellgate has become well known for its eye-catching frontage and outlandish and quirky goods.
Beryl Hankin recently announced its closure following the unexpected death of husband Ray.
The Grade II listed three-storey building has now gone on the market after three decades as an "icon".
Mrs Hankin said the closure of the shop, due to take place in June, was sad but it was "more about the people than the bricks and mortar".
'Culture shock' shop to close after 51 years
The business was first opened by Mrs Hankin and her mother, Irene, at its original location in Court Arcade in 1972.
It is thought to have been the first shop to bring "hippy" goods to the area, something others in Darlington were not doing.
It moved to its present home in 1990 when the original venue was placed at risk of demolition.
Mrs Hankin said there had been lots of memories made inside the building, which has been put on the market by the landlord for about £125,000.
"We may close a few weeks earlier because there will be a lot of clearing out to do," she said.
"We will have to try and get rid of fixtures and fittings - I will miss it because it's a beautiful shop.
"There are hundreds of photographs on the wall and I hope the business that takes it over will keep them, but it's up to them."
The Guru Boutique co-founder said last year she "needed the time" to grieve after the death of 80-year-old husband, Ray, and a recent cancer scare.
She said as a result it did not feel "responsible" to renew a lease on the building, which will expire at the end of June.
However, the business will continue to exist online, and Mrs Hankin eventually wants to open an outdoor market stall.
"Online is okay, but it's not as personal as seeing people and our friends can pop round and we can have a chin wag," she said.-bbc
'Brewkery' social enterprise plans to expand
A social enterprise that supports people with learning disabilities by teaching them baking and brewing beer is planning to expand.
Equal Brewkery in Norwich has just been given an old caravan which they hope to renovate and take to local fairs and markets.
Since it started in 2017, it has supported more than 100 vulnerable adults and is run by volunteers.
Founder Bill Russell said: "It's working well at the moment but we survive on the goodness of people."
Bill Russell started the social enterprise after suffering a stroke
The enterprise, on Ipswich Road, is a combination of microbrewery and bakery and it teaches people with learning disabilities how to produce beer and bread with the aim that they go on to get a job or live more independent lives.
All profits from the sales of the goods go back into the organisation and the Co-op has started stocking one of the beers in eight of its local shops.
The organisation has been given a caravan which it hopes to renovate
Mr Russell, a former head teacher, had the idea after suffering a stroke in 2015.
"I was in a hospital and I thought about what happens to people when they've had injuries and the like and I thought I can brew and I can teach so I can give something back," he said.
The 71-year-old said it has been a success but he wanted to expand.
"We don't have enough spaces for the people who want to come," he said.
Volunteer Fairless Masterman said the classes build up the people's skills
Fairless Masterman, one of the volunteers who works and Equal Brewkery, said it was "unlike anything I've done before".
The 69-year-old retiree, who has been there for four years, said he worked with adults with a range of disabilities and the classes "build up their understanding" of the baking and brewing processes.
"It's very rewarding; it's never unenjoyable," he said.-bbc
Kenyan Opposition Leader Calls for Weekly Rallies Over Cost-of-Living Crisis
Kenya's veteran opposition leader Raila Odinga called Monday for weekly protests, as clashes erupted between police and supporters demonstrating over the country's cost-of-living crisis.
"Every Monday there will be a strike, there will be a demonstration," Odinga told crowds of chanting followers in Nairobi. "The war has begun, it will not end until Kenyans get their rights."
Odinga had called Monday's demonstrations against the government of President William Ruto in protest at soaring prices of basic goods in Kenya and what he said was last year's "stolen" election.
The opposition leader narrowly lost his fifth tilt at the presidency in the August poll despite being backed by former president Uhuru Kenyatta.
Riot police had earlier fired tear gas and water cannon on Odinga's motorcade near a Nairobi hotel, where he had been due to hold a press conference before being forced to leave.
Running battles erupted between stone-throwing demonstrators and police in several parts of the capital and at least one other Kenyan city, in the first major unrest since Ruto became president last year.
Millions going hungry
Police used tear gas against protesters gathered at a site near government offices in the heart of Nairobi.
Two dozen people were arrested, including the senate minority leader Stewart Madzayo and one other MP.
Kenyans are struggling as prices for basic necessities soar. The value of the shilling has dropped sharply against the US dollar and a sustained drought has left millions hungry.
In Nairobi's biggest slum Kibera, a bastion of Odinga support, people set tyres ablaze while police used water cannon to disperse protesters.
Demonstrators and police also clashed in the lakeside city of Kisumu in western Kenya, another Odinga stronghold.
Day of destiny
Nairobi police chief Adamson Bungei said on Sunday that police had received requests to hold two demonstrations late Saturday and early Sunday, when normally three days' notice is required.
"For public safety, neither has been granted," he said.
Interior Minister Kithure Kindiki warned on Sunday that anyone inciting public disorder or disturbing the peace would be prosecuted.
Odinga, the leader of the Azimio la Umoja (Resolution for Unity) party, who described Monday as a "day of destiny," continues to claim that Ruto's August election win was fraudulent and denounces his government as illegitimate.
According to official results, Odinga lost to Ruto by 233,000 votes, one of the slenderest margins in Kenya's history.
The Supreme Court dismissed his appeal against the result, with its judges giving a unanimous ruling in favour of Ruto, finding there was no evidence for Odinga's accusations.
Ruto has declared that he will not be intimidated by the demonstrations, saying: "You are not going to threaten us with ultimatums and chaos and impunity.
"We will not allow that," he said, calling on Odinga to act in a "legal and constitutional manner."
-RFI website.
South Africa: Eskom Will Resolve Power Crisis - Electricity Minister
Minister in the Presidency responsible for Electricity, Dr Kgosientsho Ramokgopa, believes that Eskom employees are the heart of resolving the ongoing energy crisis.
"My view has always been the biggest asset for any organisation is its workers and the reason we're starting from the bottom up is to appreciate and understand the efforts being made at the station level," he told media on Monday.
The Minister said this during a tour of the Duvha Power Station in Mpumalanga, where he kick-started his engagements with management, workers, and unions at Eskom's 14 power stations nationwide.
"I committed to the country that we'll be at the station level, examining the issues that affect every unit and getting from the station manager, organised labour and workers about what are the interventions, in their opinion, they think are appropriate to help scale up energy availability," he told media.
He shot down the view that his fact-finding exercise was sparked by the national shutdown that has been called by the Economic Freedom Fighters (EFF).
However, he said he will, in the next seven days continue to talk with workers to understand the nature and scale of the problem and update the Energy Action Plan (EAP), which President Cyril Ramaphosa unveiled last year.
Ramokgopa believes that the EAP's first pillar, which speaks to improving the availability of existing supply system stability and increasing generation capacity was important.
He said this would enable Eskom to address the 6 000 MW deficit in the energy ecosystem, which according to the Minister, will be derived from the 81 Eskom existing units across the country.
"It's important that we have an appreciation that the people who live and breathe these units are the people from Eskom. Some of them have accumulated experience of 25 years," he said.
"We're joined at the hip and it's them who are in the cold face of the day-to-day interaction of these units. But I'm the public face of how we're going to resolve load shedding."
South Africans have been experiencing lower stages of load shedding for the first time in a long while this past weekend, with some citizens quipping that "they do not know what to do with so much power".
"To get to a stage where people find it very strange to have electricity for a day or two days in succession... underscores the gravity of the problem."
However, he said government's interventions did not start with the Minister of Electricity.
"The Energy Action Plan has been there and all we're doing [is] accelerating [the action] and of course, we can see that six power stations are beginning to pick up and the energy availability factor is going up," he said.
President Ramaphosa appointed Ramokgopa to the post on 6 March.
Ramokgopa's primary goal, according to the President, will be to drive government's programme of significantly reducing the "severity and frequency of load shedding as a matter of urgency" and to expedite government's work to ensure the full implementation of the EAP.
"I am confident about our ability to address the crisis," he said.
SAnews.gov.za.
Mozambique Submits First Assessment Report to Exit the 'Grey List'
Maputo — Mozambique has just submitted its first assessment report to the Financial Action Task Force (FATF), as part of the steps the country is taking to leave the "grey list', according to a source at the Ministry of Economy and Finance (MEF).
The FATF is an entity that promotes international policies to combat money laundering and the financing of terrorism and the proliferation of weapons of mass destruction.
The country was placed on the FATF's Grey List on October 21, 2022 for an observation period of two years (2022-2024) by the International Cooperation and Review Group (ICRG), an entity that brings together experts who monitor the progress of countries in matters related to money laundering and terrorist financing, and within this process Mozambique is required to report within an established plan.
According to the source, cited in Monday's issue of the Maputo daily "Notícias', the ICRG will produce its assessment on Mozambique's performance since the country was placed under surveillance by the FATF in October last year.
In order to leave the grey list, Mozambique will have to carry out by 2024 a national risk assessment for non-governmental organizations, install a system for the identification of the beneficial owner, and develop national and international cooperation actions regarding money laundering, and counter-terrorism.
The United States, the European Union, and the World Bank are supporting Mozambique's efforts to have its name removed from the list in the next two years.
National partners have also been suggesting to the relevant bodies, notably the Bank of Mozambique, the Ministry of Economy and Finance (MEF), and the Justice Ministry, to analyze the role of the judiciary in preventing and combating the phenomenon.
Similarly, they also suggest analyzing the role of non-financial institutions and the application of sanctions.'
Africa's Deepening Unemployment Crisis
One in two young people in South Africa are unemployed while more than 1.2 million graduates are without jobs in Uganda. More own initiatives could ease unemployment in Africa, experts say.
Steven Moyo gets up every day at 5 a.m. and searches for work on the streets of South Africa's economic metropolis, Johannesburg.
He talks to drivers at the intersections, offers his services. Moyo is an electrician. On good days, he earns a maximum of Ꞓ30 (around $31.50). But those days are getting fewer and fewer.
South Africa is in a deep recession, exacerbated by the COVID pandemic.
"The situation has gotten worse. No one is there to hire us," Moyo told DW. He said he does not know where he will be able to earn money for food and rent.
Stories like Moyo's are not uncommon in South Africa.
In Cape Town, Namhla Mcimbi told DW that she had to abandon her psychology studies because she could no longer pay the tuition fees.
Like many of her fellow students, Mcimbi has now slipped into unemployment.
However, contacts are important for a possible way out, the 20-something pointed out.
"People place their cousins, their sisters in companies, so it's hard for you as a stranger to get a job," she told DW.
Rate is dire in Namibia and Nigeria too
The economic situation in South Africa is dire, with about one in every two people under 34 unemployed.
Official figures show the joblessness rate has recovered slightly but at 32.7% in the fourth quarter of 2022, it is still among the highest both in Africa and the world.
Namibia and Nigeria, recently had the highest unemployment rates in the world, according to US media company Bloomberg. Djibouti and Eswatini also rank high on that list.
It is estimated that by 2050, a quarter of the world's working population will live in Africa.
Many unemployed South African youth took part in a major spate of looting and unrest in Johannesburg and Durban in July 2021.
President Cyril Ramaphosa then was forced to introduce a welfare benefit for the unemployed of around Ꞓ18 per month, said Professor Patrick Bond, a sociologist and economist at the University of Johannesburg.
"This is a sign of the state's desperation to throw money at the problem," he told DW.
But Bond doesn't think this approach will achieve its goals. He argues for a basic income grant with a much higher amount of at least Ꞓ40 per month to cover the vital costs of food and shelter.
But the main obstacle to this, he said, is international finance and pressure from credit rating agencies -- high foreign debts put pressure on the finance minister to cut budgets and limit social wages. Political debates about a possible basic income in South Africa continue.
Lack of jobs -- in rural and urban areas
The employment crisis in sub-Saharan Africa is worsening, according to a study compiled by economist and Africa expert Robert Kappel of the Friedrich Ebert Foundation's Africa Department.
"Every year, some 20 million people seek jobs that are not available in rural or urban areas," it said.
Uganda is another example of the large gap between job supply and job demand. Some 400,000 young Ugandans enter the labor market each year competing for only about 52,000 available formal jobs, according to one study.
High employment growth is needed to address rising social challenges, it said.
More than 1.2 million young graduates are currently without jobs in Uganda. Maureen Babidiye was one of them. She trained in travel management at an aviation school and has now been unemployed for two years.
After internships in companies, Babidiye tried to get a airline crew job -- without success.
"Competition is fierce and nothing works without contacts," she told DW.
Experts say self-initiative counts
Now Babidiye wants to become self-employed and set up her own travel agency, which she wants to build online through contacts.
Self-initiative is exactly what counts these days, according to Charles Ocici, director of the Enterprise Uganda Foundation.
"Jobs are few and far between, and they will continue to be lost. This is true not only for Uganda, but worldwide," Ocici said. "The days are gone when everything went according to script -- go to school, study hard and then get a job."
Ocici said people need to rethink and be open to getting involved in the market in valuable ways. As an employee, or else with your own private business.
"Many people are more supportive of those who have an open mind to open a business."
Fear of Arab Spring-style uprising
The high level of discontent, especially among the youth, is increasingly worrying the establishment in South Africa, which fears an Arab Spring-style uprising, said the sociologist Patrick Bond.
In 2010, protests in Tunisia, inspired the youth in numerous Arab countries to revolt against political systems.
In South Africa, this scenario is often portrayed as a threat from a ruling party that was once very supportive of youth rebellion but is now part of the oppression of the people because it follows Western economic policies, Bond said.
If the West continues to force South Africa to repay its debts and the country has less money for employment programs and social services, it risks turning the country further toward the BRICS countries of Russia, China and India and regimes like Iran and Saudi Arabia.
For Namhla Mcimbi in Cape Town, a glimmer of hope came after the frustration. She turned to Harambee Youth Employment Accelerator, an NGO which promotes youth employment through partnerships.
There, she learned basic requirements needed to find a job. Not long afterwards, she had landed a temporary job as a teaching assistant.
Ethiopia Is One of Recent Examples of Resilience in Face of Multiple Shocks, Finance Minister Says
Addis Ababa — Finance Minister of Ethiopia, Ahmed Shide said that Ethiopia is one of Africa's recent examples of resilience in the face of multiple shocks.
The finance Minister Ahmed delivered speech on the 55th Conference of Ministers of Finance and Economic Planning is underway in Addis Ababa with the theme: "recovery and transformation in Africa to reduce inequalities and vulnerabilities."
In his keynote address at the conference, the minister said that the current government of Ethiopia launched the Home-Grown Economic Reform in 2018 to ensure macro-economic stability, easing of doing business and addressing institutional constraints for inclusive and private-sector led growth.
Unfortunately, right after launching, the reform faced unexpected obstacles due to the outbreak of conflict in Tigray region, the COVID-19 pandemic, climate change induced shocks such as drought, and locust invasion in some part of the country, Ahmed pointed out.
"Amidst these internal and external shocks, the government exerted maximum effort to take the reform agenda forward and achieved remarkable results, including positive per capita income growth, better debt management, improved Foreign Direct Investment (FDI) flows and export performance, as well as privatization of public enterprises and liberalization of selected sectors, which have boosted private sector participation in the economy."
He further stated Ethiopia also improved its domestic resource mobilization capacity through innovative reforms in tax administration, tax rates and application of information technologies.
In spite of these positive gains, most of the macro-economic imbalances such as fiscal deficit, foreign exchange depletion, galloping inflation and accumulated debt, remain stern economic setbacks, the minister acknowledged.
"We have therefore continued working on the second Home Grown Economic Reform to consolidate the gains and address current and emerging macroeconomic imbalances.
Furthermore, as we work towards peace consolidation, our reform also focuses on paving the way for equitable and inclusive post-conflict recovery that will contribute towards strengthening social cohesion among all Ethiopians," according to him.
Speaking on the 55th Conference of Ministers of Finance and Economic Planning where they deliberate on Africa's state of economic and social development, and regional integration, the finance minister underlined that Africa has a lot to do to resolve its socio-economic challenges, including the widening income inequalities and extreme poverty across the continent.
Until 2019, Africa was home to the world's fastest-growing economies- a growth fueled partly by favorable terms of trade, better macroeconomic management and growing investment, Ahmed said. However, he argued that the advent of the COVID-19 changed this success story dramatically.
"The war in Eastern Europe disrupted global value chains, led to a spike in key commodity prices such as fuel, edible oil, wheat, and fertilizers as well as tightening of monetary policies in the developed countries, leading to an increase in global lending rates."
Moreover, climate change induced droughts, floods and erratic rain patterns are not only disrupting economic activities and productivities, but also endanger millions of lives in our continent.
The combined impacts of the multiple and recurring global shocks are causing hardships unprecedented in recent memory and led to significant liquidity crunches in the economies of many African countries, the finance minister underscored.
The immediate and long-term consequences of COVID-19 and the global economic and security crisis are wakeup calls for Africa to rethink its development paradigms and seek homegrown solutions before the crisis engulf the continent, he urged.
For him, in order to address the multiple economic challenges of the African continent, it requires a collaborative and concentrated effort, which should be people-focused, sustainable in policy measures and inclusive enough in addressing the most vulnerable people.
The finance minister finally said the recent experience of his country (ETHIOPIA) on improving agricultural productivity to achieve food sovereignty is a prime example of exploiting collective wisdom of African stakeholders.
He also called upon all fellow Africans and partners to concentrate on their untapped potentials to transform the continent and eliminate undeserved poverty.
-ENA.
South Africa: Electricity Minister Visits Eskom Power Stations
In the next two weeks, starting today, Minister in the Presidency responsible for Electricity, Dr Kgosientsho Ramokgopa, will be visiting all 14 Eskom power stations to engage with the management, workers, and unions.
On Monday, the Minister will kick off his drive at Kriel and Duvha power stations in Mpumalanga, where he is accompanied by his advisor, Silas Zimu, and other senior officials.
According to media reports, the Minister said he has no regrets for taking on the toughest job in the country - to end load shedding.
Early this month, President Cyril Ramaphosa appointed Ramokgopa as the new Minister in the Presidency responsible for Electricity.
Ramokgopa's primary goal, according to the President, will be to drive government's programme of significantly reducing the "severity and frequency of load shedding as a matter of urgency" and to expedite government's work to ensure the full implementation of the Energy Action Plan.
The new Minister of Electricity is empowered to carry out his duties through the transfer of certain powers and functions from the President in terms of the Constitution.
He is also tasked with urgently resolving the energy crisis through the recently gazetted National State of Disaster-related to electricity regulations.
The newly appointed Minister said he was "humbled" by the President's vote of confidence in him.
"We have a mammoth task ahead of us to resolve the energy crisis that confronts our country."
In the immediate, he said, the primary responsibility is to turn around the performance of existing power stations and stabilise the energy supply, while adding new capacity to the grid.
The Minister has hit the ground running and has been engaging with various key stakeholders, including meetings with the Black Business Council, mobile network operators, and conducting media interviews.
He has also met with the Chinese Ambassador to South Africa, Chen Xiaodong, to discuss possible areas of collaboration to end the rolling blackouts.
The leaders discussed sourcing technical expertise, demand-side management intervention as it relates to supply, training young people to meet demands for solar PV installations, and the introduction of microgrids and emergency power.
SAnews.gov.za.
Flying Popularity Continues to Rise in Africa
Africa has not been historically synonymous with air travel. Although it’s the largest continent by size and population, home to 12% of the world’s people, it hosts just 1% of the planet’s air traffic. That’s down to a number of factors, but inadequate infrastructure, airline insolvency, and lack of demand among African citizens are chief among them.
However, the dial does appear to be moving on that last issue at least. As more airlines offer greater coverage on their route plans, and more Africans have a larger amount of disposable income, interest in flying has steadily recent. Of course, the pandemic put a check on such growth, but thankfully it was just a temporary one and flying figures on the continent are now continuing to climb.
Safer airlines
For too long, Africa endured a reputation as one of the most dangerous places to fly anywhere in the world. This was due to lax standards, rogue operations and old, unmaintained aircraft. However, the situation has drastically improved in recent years, so much so that there is now a plethora of options to choose from.
Indeed, there are currently 37 different airlines operating from Africa with accreditation from the International Air Transport Association (IATA), including such household names as Ethiopian Airlines, which is widely regarded as one of the best airlines anywhere around the globe. This has reassured passengers who may previously have been worried for their safety when flying in Africa.
Developing infrastructure
One of the biggest issues plaguing African air travel has been insufficient connectivity within the continent itself. Although there are some 800 routes connecting African airports with countries in other continents, there are just 500 intracontinental flight paths inside Africa itself. This means that only 9% of air traffic in Africa was between African nations before the outbreak of Covid-19.
This is clearly a problem – but it’s one which is being addressed. For example, Brazilian small aircraft carrier Embraer has shown great interest in developing intracontinental routes in Africa. With experience of handling such routes in other parts of the world, and having already bolstered the performance of some African airlines through use of its craft, Embraer is in pole position to tackle the issue.
Greater demand
Of course, the biggest factor in the rising popularity of flying in Africa is the people themselves. With safer aircraft and better route coverage, more options now exist; but these would mean nothing were it not for the interest of African citizens. A growing middle class has led to more disposable income for everyday Africans, with many choosing to holiday abroad in other countries on the continent.
At the same time, business travel is equally important to the African aviation industry. The establishment of the African Continental Free Trade Area (ACFTA) in 2018 has facilitated cross-border commerce and led to an upsurge in planes traveling around the continent ferrying businessmen to and from their work. All of this taken together means that the skies are the limit for the African aviation industry moving forwards.
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Ex-Norwegian Air Boeing 787 Dreamliners Hit Scrap Heap After Just Ten Years
Widebody and jumbo jet aircraft are having a tough time. The pandemic, which resulted in the parking of 16,000 commercial aircraft, accelerated the trend to replace aging four-engine jumbo jets with more efficient twin-engine craft. Production ended for both the Airbus A380 and the venerable Boeing 747. Many of these aircraft were taken out of service, never to return.
Now, a pair of ten-year-old Boeing 787-8 Dreamliners once operated by budget airline Norwegian Air Shuttle are being scrapped. Delivered in 2013, the fuel-efficient widebody jets built of advanced composites were capable of flying 248 passengers up to 7300 miles.
The Dreamliner is a successful aircraft, still in production with more than 1600 delivered or on order. The list price for a new Boeing 787-8 is $239 million dollars. Yet even as international travel opens again for these long-range aircraft, two Dreamliners barely ten years old are waiting for the wrecker’s ball.
This particular pair of planes have been sitting in storage since May of 2019. They were among dozens of Dreamliners grounded due to fan blade corrosion issues with their Rolls Royce Trent 1000 engines.
In August 2019, corrosion led to a crack in a turbine fan blade of a Norwegian 787 taking off from Rome’s Fiumicino Airport. This led to an “uncontained engine failure” and emergency landing. Buildings and automobiles were damaged by flying engine parts, but only person was injured, none on the aircraft.-forbes
Reserve Bank expected to hike rates again
Central banks in Africa’s biggest economies are poised to raise interest rates this month to contain sticky inflation and deter a selloff in their assets exacerbated by the collapse of US lender Silicon Valley Bank and stress at Credit Suisse.
South Africa, along with Nigeria, Egypt, Morocco and Kenya are projected to raise borrowing costs in the next two weeks. Monetary authorities in nations such as Ghana and Angola, where inflation is on a downswing are predicted to hold.
The South African Reserve Bank’s (SARB's) fight against inflation is however unlikely to be derailed by weakness in the global banking system.
Policymakers nearing the end of the interest-rate hiking cycle, will probably raise the benchmark by 25 basis points to address potential risks to the inflation outlook, said Sanisha Packirisamy, an economist at Momentum Investments. They include the knock on effects of a weaker currency, with the rand having weakened about 7% against the dollar this year.
Average inflation expectations for the year stand at 6.3%, well above the central bank’s 4.5% target.-news24
Gold drops from 1-year peak as banking fragility drives wild swings
Gold prices retreated from their highest level in a year in volatile trading on Monday, as share markets and Treasury yields bounced back on central banks’ efforts to shore up confidence in the financial sector.
Spot gold
last dipped 0.47% to $1,978.66 per ounce, after sliding over 1%, while U.S. gold futures
rose rose 0.5% to settle at $1,982.80.
Earlier in the session, prices of the yellow metal had climbed 1% to their highest since March 2022 at $2,009.59, just shy of a record set during the onset of the COVID-19 pandemic.
“While emergency efforts are being done... now you’re seeing that this is far from over. Safe-haven flows are fairly going to be the key trade,” Edward Moya, senior market analyst at OANDA, said.
In an effort to help the banking sector, top central banks moved on Sunday to bolster the flow of cash around the world.
Benchmark Treasury yields rose close to their session highs, while equities bounced back on the rescue of Credit Suisse which helped calm some jitters around a bigger banking crisis.
Gold prices have rallied more than $100 after the collapse of U.S.-based Silicon Valley Bank earlier this month.
“Today’s rejection above $2,000 may trigger some profit-taking, but in our opinion not a change in direction,” Ole Hansen, head of commodity strategy at Saxo Bank, said in a note, adding he maintains a bullish outlook on gold.
Bullion is considered a safe-haven asset during financial uncertainty, and lower interest rates reduce the opportunity cost of holding the non-yielding bullion, making it more attractive.
A key U.S. central bank policy announcement is due on Wednesday. Market participants are mixed on the Federal Reserve’s decision, while bets for a rate-hike pause have increased.
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