Major International Business Headlines Brief::: 08 July 2024

Mon Jul 8 11:29:51 CAT 2024

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Major International Business Headlines Brief:::  08 July 2024 

ü  Kenya: Employees Meals Above Sh48,000 Taxable, KRA Clarifies

ü  Nigeria: How Sirika Ignored Warnings About Nigeria Air - Stakeholders

ü  Nigeria: Why CBN Insists On Another Recapitalisation - Cardoso

ü  Nigeria: Racketeering...Air Passengers Lament As Touts Take Over Ticketing

ü  Nigeria: Why Fuel Queues Persist, Spread, By Marketers

ü  South Africa: Impoverished Joburgers Buckle Under New Monthly R200 Prepaid Meter Fixed Electricity Surcharge

ü  Kenya: EU-Kenya Trade Agreement Takes Effect

ü  Malawi: Report Reveal That Most Malawians Dont Have Proper Jobs, Many Depend On Maganyu

ü  Senegal Sets Out to Secure Fairer Partnerships in Mining Sector

ü  Nigeria: Amnesty International Questions Nigeria's Choice of Shell Evaluators

ü  Boeing to plead guilty to criminal fraud charge

ü  Hollywood icon Paramount agrees $28bn merger deal

ü  I had to downgrade my life' - US workers in debt to buy groceries

ü  US jobs growth in June beats expectations

 <mailto:zitfmktg at zitf.co.zw> Kenya: Employees Meals Above Sh48,000 Taxable, KRA Clarifies

Nairobi — The Kenya Revenue Authority (KRA) has clarified that if an employer provides meals valued above Sh48,000 annually to an employee, the entire value of those meals no longer qualifies as a non-taxable benefit under Section 5(4)(f) of the ITA.

This was according to a circular issued by KRA in 2017, which 'states that gains or profits from employment do not include the value of meals served to employees in a canteen or cafeteria operated or established by the employer or provided by a third party who is a registered taxpayer, where the value of the meal does not exceed the sum of KES 48,000 per year per employee, subject to such conditions as the Commissioner may specify.'

In a statement, KRA noted that if an employer provides meals valued above Sh48,000 annually to an employee, the entire value of those meals no longer qualifies as a nontaxable benefit; rather, the entire benefit is then subject to tax on the employee.

KRA has asserted that this tax law was put in place so as to cushion the incomes of low- and middle-income employees, who constitute the majority of meal benefit recipients.

"The above circular was issued pursuant to Section 5(4)(f) of the ITA, which states that gains or profits from employment do not include the value of meals served to employees in a canteen or cafeteria operated or established by the employer or provided by a third party who is a registered taxpayer, where the value of the meal does not exceed the sum of KES 48,000 per year per employee, subject to such conditions as the Commissioner may specify," it stated.

KRA has urged employers to gross up the value of meal benefits for tax purposes by including the tax amount in the benefit itself and remitting the PAYE due on behalf of the employee so as to alleviate the burden on employees from increased tax liability on meals.

KRA has further urged employees to review their records so as to determine any historical exposure from potential additional assessments for tax on meal benefits to their employees, after which they are required to pay the full tax liabilities, inclusive of penalties and interests, if they find any historical exposure.

"If an employer has any historical exposure, they may consider taking advantage of the ongoing tax amnesty to enjoy a waiver of penalties and interest for the period ending 31 December 2022. The amnesty program runs until 30 June 2024. However, for any exposure outside the tax amnesty period,employers would be required to pay the full tax liability inclusive of penalties and interest," it stated.- Capital FM.

Nigeria: How Sirika Ignored Warnings About Nigeria Air - Stakeholders

Following the termination of Nigeria Air joint venture with Ethiopian Airlines, stakeholders have said former Aviation Minister, Hadi Sirika, ignored warnings against going into the failed project.

Last week, Ethiopian Airlines announced that the Nigerian government had lost interest in following through with the partnership.

The airline's Group Chief Executive Officer, Mesfin Tasew, had said: "The Nigeria government has lost interest in partnering with a foreign airline."

Therefore, the industry experts commended the federal government for the action it took, saying Emirates, Qatar, Etihad and Turkish Airlines shunned the former minister when he came up with the project.

They spoke in separate conversations with Vanguard, cautioning government against floating another national carrier.

Why it failed

A former military commandant at the Murtala Muhammed Airport, Group Captain John Ojikutu, retd, said: "Going by what I know, I told Sirika that a national carrier wouldn't work because they wanted to start it as a government carrier.

"If I may ask, how many countries are into national carriers now? It is only very few countries and you will find that the population of those countries are probably less than 50 million.

"Those are the type of countries that can talk about establishing a national carrier, not Nigeria. For us, we cannot set up a national carrier. What we can do is to set up a flag carrier. They should set up a flag carrier and forget about this issue of national carriers because it won't work."

Disrespect agreements

Also speaking, former spokesperson of the defunct Nigeria Airways, Mr Chris Aligbe, said: "When Sirika was marketing Nigeria Air, because I followed the whole procedure, I saw he went on an extensive marketing to Emirates, Qatar, Etihad, Turkish Airline and even Pegasus, who said 'no, they were not interested in investing'.

"Our country is known globally as a country that doesn't respect agreements. That is our emblem. Today, Nigeria is blacklisted by aircraft leasing companies. That is why we see wet lease, not dry lease aircraft.

"No Nigeria airline can get a dry lease because two airlines in Nigeria undermined the Cape Town Convention on international interests in mobile equipment. It is one of the reasons, with all the marketing Sirika did, when they advertised Nigeria Air, it was only Ethiopian Airline that applied."

Future plans

Former Minister of Aviation, Air Vice Marshal Anthony Okpere, retd, on his part, said if there were plans to establish a national carrier in future, "what Federal Government should do is designate Air Peace and Ibom Air as the country's carriers.

"To start all over again by buying aircraft or going to rent aircraft and start painting it to deceive Nigerians will not work. We need to develop our internal capacity and expand it.-Vanguard.

Nigeria: Why CBN Insists On Another Recapitalisation - Cardoso

Lagos — The Central Bank of Nigeria, CBN, insisted weekend that further capitalisation of banks in the country was for the common good of the nation.

CBN governor, Dr Olayemi Cardoso, stated this at the launch of the book, "Power of One Man," written by Dr. Ray Echebiri.

Cardoso, represented at the event by Mr Philip Ikeazor, Deputy Governor, Financial System Stability Directorate, said: "Incidentally, the current manifesto of the Central Bank has embarked on another round of banking consolidation.

'Why consolidation is necessary'

"Why was it necessary then? Professor Soludo wanted to make the banks robust, resilient, and fit for purpose to grow the economy. And that is exactly the same reason we are embarking on a similar journey today.

"Again, I think by coincidence, if you check the quantum of the capital, minimum capital levels that we require, it's pretty similar, because international banks are moving from N50 billion to N500 billion, which is 10 times, similar to Soludo's 12 and a half times, and national banks are moving from N25 billion to N200 billion, roughly about eight times. Why would you think this is the quantum leap? "Basically, when you do consolidations, you would look at the macroeconomic headwinds, the macroeconomic conditions on ground, and, of course, apply your stress tests. And when you apply stress tests today, which I'm sure some of the big banks have done, they would have taken a guess where the capital levels were going to land.

"If you compare the bank assets in Nigeria to GDP, and compare it to similar economies in Africa, you can see they were way behind. So, this exercise is also to strengthen the financial system, make it robust to be able to meet the expected headwinds.

"Remember that when the current administration came into place, there was unification of FX rates, and there was removal of fuel subsidies. And the impact on the economy, the manufacturing sector, is beginning to manifest, or has started manifesting in 2024, and will continue over the next few years.

"So it is important that the banks were recapitalized to the level where they'll be able to absorb any shocks that come, and also position the banks to be able to grow the economy.

"So, Professor Soludo had laid the foundation 20 years ago of taking the bold decisions required to drive the economy. One of the questions raised and comments passed on interest rates, economic growth and everybody's debating what it should be. But I'd like to remind people that once you do not tame and control inflation, and you get into hyperinflation, I think it takes you several years to get out of it.

"There's a South American country that still has very significant oil reserves, but they are in hyperinflation. And I think everybody is aware of what's happening in those economies. We have our brothers in East Africa who are in the world and are in hyperinflation. We know how hard they're struggling to come out of that.

"So for us at the Central Bank, focusing on our core mandate of price stability, maintaining a stable exchange rate, and, of course, economic growth, but it's a question of sequencing, because it's very important that we do not enter hyperinflation, because once you enter hyperinflation, the transmission of monetary policy tools becomes completely ineffective.

"It is important that we avoid that. And they've been asked the question, how long will you maintain high interest rates? That would be for as long as we are able to control and start to reverse galloping inflation.

"I think we're all aware that in the Western world, they did have rate hikes to be able to control theirs, and they maintained it for a very long time. It's only now that they stopped rate hikes, but they have not even started dropping the rates as we speak.

"So it's important that we tighten and hold on a little while, and we expect that in no distant future, we will be able to start slowing down on the rate hikes."

'Banking, financial system changed forever'

Meanwhile, eminent Nigerians, including former President Olusegun Obasanjo; former Central Bank of Nigeria, Prof. Chukwuma Soludo, Governor Babajide Sanwo-Olu, among others, described bank recapitalisation carried out 20 years ago from N20 billion to N250 billion as a disruptive change that changed Nigerian banking and financial system forever.

Obasanjo, who was represented by former Cross River State governor, Donald Duke, believed that working with the right team was paramount in every economy.

He said: "I believe that I am that one man because I put together the team. It's like a coach, a football manager, you pick the captain, and the captain was Captain Soludo.

"But, without the team, they are not going to win a match. So, Captain Soludo has saluted his team,but I take pride in having put together the team."

Earlier in his speech, Sanwo-Olu, said the book came at a time to reflect as economists, bankers, opinion leaders, businessmen and politicians and look at how Soludo's team survived those challenges.

"We're also at a point where the current CBN and the leadership are going through a similar exercise, banking consolidation, increment in share capital and the rest of it.-Vanguard.

Nigeria: Racketeering...Air Passengers Lament As Touts Take Over Ticketing

Airfares are soaring daily in the country as touts have taken over ticketing and flight booking in some airports.

LEADERSHIP reports that despite passengers paying a princely N250,000 for a one-hour flight, for instance, from Lagos to Abuja, fare hikes, flight delays, and cancellations continue unabated at the nation's airports, especially Lagos and Abuja.

Stakeholders in the aviation sector have blamed the nuisance of racketeering on the reduction in the fleet of local airlines operating, which may have led to an increase in ticket prices and racketeering among airline staff and touts at the airports.

LEADERSHIP gathered that the reduction in local airlines' fleets was due to an increase in the number of grounded aircraft of different operators due to volatility in the foreign exchange, as well as Dana Airline's suspension by the Nigerian Civil Aviation Authority (NCAA).

According to experts, the number of airline passengers has remained the same in the last year, and airline seats have shrunk due to the challenges bedeviling the sector.

This development has further reduced the number of serviceable aircraft in the country, which has led to ticket racketeering as fewer seats are available for thousands of airline passengers across the country.

For instance, the Lagos-Abuja route has seen more passenger glut than others as airlines now charge as high as N250,000 or more for a 45-minute one-way economy ticket.

In the last year, 13 domestic airlines operated about 91 aircraft in the country, but now a half of the aircraft have been suspended due to maintenance checks and suspension by the civil aviation authorities, thereby putting pressure on the few available aircraft.

The airlines still in operation are Aero Contractor, Air Peace, Arik, Azman, Dana, Green Africa, Ibom Air, Max Air, NG Eagle, Overland, Rano Air, United Nigeria Airline and ValueJet.

But Dana Air, a low carrier airline, has six of its aircraft grounded by the NCAA after the minister of aviation, Festus Keyamo, recommended its suspension over a runway excursion it had recently.

Also, exchange rate volatility has trapped several aircraft on maintenance checks abroad.

Speaking to LEADERSHIP, travel expert and aviation commentator, Olumide Ohunayo, said only a few aircraft had been deployed to serve domestic route passengers as Nigerian airlines struggle with fleet reduction due to high maintenance cost.

According to Ohunayo, the reduction in fleet has been responsible for ticket racketeering among airlines' ticketing staff, touts, and desperate passengers.

He also disclosed that airlines cash in on the rush of passengers by selling business class seats as economy seats.

"We have fewer seats chasing the same number of old passengers. Passengers haven't increased, but the seats have been lowered by Dana Air, which was shut down by the NCAA, and other airlines have not been able to go for lease arrangements due to the foreign exchange crisis in the country. Also, airlines that have gone for maintenance haven't returned, so lower aircraft seats are pursuing the same high numbers of passengers.

"Also, passengers won't grow when fares are high, and when fares are high in Nigeria, official and unofficial racketeering comes into play. We will see touts conniving with airlines' staff to block seats ahead only to sell at exorbitant prices for those who go to the counter to pick up their tickets. Anyone who goes to the counter to pick a ticket will pay higher," Ohunayo stated.

He posited that to stop racketeering, more airlines should enter the sector with the approval of Airline Operating Certificates (AOC) and encourage the establishment of more Maintenance Repair and Operations (MROs) outfits in the country.

"Official racketeering is when airlines will sell first class or premium economy seats to you but, basically, it is economy you are purchasing. However, because the passengers are eager to travel, they board the flight. So, supply has dwindled, but demand has not increased. To have more seats, we should encourage those applying for new AOCs to come in and see how we can expedite the process of clearing aircraft parts brought in by operators and expedite support for those in the process of starting MROs and those presently operating.

"Also, we need to see how to support the operation of local airline operators with clean accounting books to get more facilities for their operations," he said.

Ohunayo, who is also the director of research at Zenith Travels, said racketeering and high capacity were problems that currently occurred on routes where Dana operated.

"The withdrawal of Dana's licence and the grounding of aircraft that can't go on maintenance due to lack of foreign exchange have reduced fleet size.

"The grounding of Dana is a major problem. We need to find a way around this capacity problem and seat availability. The number of passengers has not increased, but aircraft have dwindled. The passengers are really suffering during this period," he said.

On his part, the former Commandant of Murtala Muhammed Airport (MMA), Lagos, Capt. John Ojikutu (retd), said to stop touts from cashing in on passenger surge and engaging in racketeering at the airports, all local airline operators should process their passengers through Computer Assisted Pre-Passenger Screening (CAPPS).

Ojikutu, the chief executive officer of Centurion Aviation Security and Safety Consult, further stated that airlines should not sell tickets inside the passenger terminal where checking-in takes place, but outside.

"Who are those touting, and for which airlines? Were the tickets bought online or from whose tables or pockets and with which names?" he asked.

"It is not difficult to find out if each airline has CAPPS, which must be approved by the NCAA. Passengers not processed through CAPPS should not be allowed into the airport terminal buildings through the Access Control.

"Airlines should not sell tickets inside the passenger terminal where the checking-in occurs but outside. It is not new, and it was practised in the 80s when passengers would travel with tickets that bore other people's names. The daughter of a former governor who died in the Nigeria Airways plane crash in Enugu was a victim of ticket racketeering," Ojikutu, former general secretary of Aviation Round Table Initiative (ART), stated.

When contacted about alleged racketeering in their terminal, Bi-Courtney Aviation Services Limited (BASL), the operator of Terminal 2, Murtala Muhammed Airport, dismissed reports that ticket racketeering and touting were occurring within the terminal.

A statement by Bi-Courtney's head of corporate communications, Ajoke Yinka-Olawuyi, described the assertions as unfounded and lacking in credible evidence.

She added that their terminal security is strict and designed to combat any illegalities of such a pattern.

"MMA2 operates under stringent security and operational protocols designed to prevent such activities. Our internal monitoring systems have found no indications of intentional hoarding of air tickets or collusion between airline staff and touts to inflate ticket prices.

"The rumours further allege that touts within the terminal use private PoS machines to facilitate fraudulent payments. At MMA2, all ticket transactions are conducted at the airlines' sales booth using their official means of payment provided by the airlines."

Quoting the company's airlines manager, Bisola Ademola-Davies, Yinka-Olawuyi said, "MMA2 is in continuous discussion with airlines to ensure that their processes and practices do not leave room for anything that could undermine a seamless passenger experience, which is what we pride ourselves on. Our collective efforts have significantly curtailed illegal activities, and we remain steadfast in our commitment to maintaining this progress."

Bi-Courtney, however, vowed that anyone found engaging in illegal activities within the terminal would be blacklisted.-Leadership.

Nigeria: Why Fuel Queues Persist, Spread, By Marketers

The long queues for Premium Motor Spirit (PMS), popularly known as petrol, which first hit the Federal Capital Territory (FCT) last weekend, and has now spread to various parts of the country, is as a result of a sudden disruption in the supply chain by natural factors.

This was the explanation provided yesterday by the Major Energy Marketers Association of Nigeria (MEMAN).

The Executive Secretary of the body, Clement Isong, said in a chat with Daily Trust that heavy rainfall across the country, particularly in Lagos, hampered ship-to-ship loading.

Others, he said, included berthing at jetties, truck load-outs and transportation of products to filling stations, creating a disruption in station supply logistics. Some independent marketers have also corroborated the position of MEMAN on the development.

Daily Trust findings showed that the acute shortage of the product has led to the closure of several filling stations in Abuja and beyond, while those still operating have seen long queues of motorists waiting for hours to purchase it.

Further findings showed that prices have surged, ranging between N800 and N900 per litre in some states, significantly higher than the official pump price.

Many motorists have expressed frustration over the situation, highlighting the challenges they face in accessing fuel for their vehicles.

The unstable supply of fuel has also led to fluctuations in transport fares, with some transporters hiking the fares by around 20 to 30 per cent in some cities.

Queues worsen in Abuja

The scarcity of the commodity intensified in Abuja and other parts of the FCT at the weekend, causing significant inconveniences for motorists and commuters.

One of our reporters who drove around the FCT yesterday, observed long fuel queues in areas such as Wuse, Airport Road, Jabi, Garki, and Kubwa as motorists crowded filling stations.

Our reporter also noticed that black marketers were taking advantage of the situation, selling fuel at over N1,000 per litre to desperate motorists. Some drivers, who ran out of fuel unexpectedly, were willing to pay up to N1,300 per litre to continue their journies.

One motorist, Musa Tijani, expressed his frustration, saying, "It is very annoying that for some days, almost all the motorists in Abuja have been struggling to get fuel. Those selling have long queues. The President Bola Tinubu-led government needs to resolve this issue quickly. We shouldn't be battling with fuel in this country, especially at this time."

Similarly, a commercial bus driver, Sunday Paul, recounted his experience of spending four hours at an NNPC filling station in the Abuja city centre on Saturday before he could purchase N40,000 worth of fuel. Despite queuing in the early hours of the morning, he said he ended up buying only 64 litres, compared to the 89 litres he used to get for the same amount.

Kano residents resort to electric motorcycle

In Kano, the price of fuel per litre surged from between N720 and N750 to as high as N800 per litre. Our correspondent in the commercial city noted that the prices vary across different fuel stations, with some selling at N780, N785, and N790 per litre.

Further findings by our correspondent showed that over the past three days, many fuel stations have either shut down operations or significantly reduced their operating hours.

This situation has led to longer queues at the stations that remained open, as they sell fuel at higher prices.

Amidst the fuel crisis, there has been a noticeable increase in the use of electric motorcycles in Kano as people are turning to such means to avoid the difficulties associated with fuel shortages.

In Katsina State, the fuel scarcity also reached critical levels, with majority of filling stations in Katsina town closed. The few stations that remained open were selling fuel at exorbitant prices ranging between N800 to N1000 per litre.

Most filling stations visited by our correspondent were shut down, exacerbating the queues. A motorist who purchased fuel at N1,000 per litre from one of the opened stations on Sunday morning noted that the stations selling at N800 were overcrowded.

In the 'black market', the price has skyrocketed to N1,500 per litre, with a 4-litre gallon selling for N6,000. This steep increase has sparked concerns among residents like Malam Zaharaddeen, who fear that the hike in fuel prices will lead to higher costs across all commodities, particularly food items.

Fuel stations in Lagos also empty

An assessment of the situation by one of our correspondents yesterday in Lagos revealed that the fuel scarcity is intensifying in that city too.

Major filling stations, including NNPC and Conoil along the Lagos-Abeokuta expressway, were observed to be closed, forcing motorists to embark on a long search for operational stations.

The only exception noted was the Northwest filling station, which was dispensing fuel along Mobolaji Bank Anthony Way from Maryland to Ikeja Under-bridge.

A motorist, who requested anonymity, said he managed to buy fuel early in the morning at an NNPC station in Abule Egba.

He expressed concerns about the resurgence of fuel scarcity. He also mentioned buying fuel for both his car and a 25-litre keg, noting that the fuel attendant demanded a higher price for those purchasing fuel in kegs.

The situation is similar in Ondo State. Several filling stations visited by our correspondent on Sunday had closed their gates, while those opened experienced extensive queues of vehicles and motorcyclists.

Mr. Adekunle Ajisafe, a motorist, said, "Many filling stations are not selling the product because it's scarce. The few that do sell are charging between N780 and N850 per litre depending on location. This situation is taking a toll on me because I can't work without fuel. My family depends on my income, and without fuel, it's very challenging."

Fuel hits N1,200 in 'black market' in Bauchi

In Bauchi, the fuel crisis has led many filling stations to halt their operations, resulting in long queues at the few stations tat were selling the product, mostly located on the outskirts of the metropolis.

Investigations revealed that the few stations that were open were selling fuel at prices ranging from N800 to N900 per litre.

Malam Salisu, a motorist in Bauchi, shared his frustration, stating that: "The filling stations have conspired not to sell their fuel. The few that are selling are charging between N800 and N900 per litre. I bought a litre for N800 in the morning along Games Village, but by the afternoon, the price had increased to N900. Many of the stations have stopped selling fuel altogether."

Further findings indicate that in the 'black market', fuel prices have skyrocketed to between N1,100 and N1,200 per litre.

In Gombe, prices of the product surged to N800 per litre at filling stations, with many NNPC retail outlets remaining shut. Although there were no long queues at most filling stations across the Gombe metropolis, fuel is being sold at prices between N750 and N800 per litre.

Our correspondent, who toured the metropolis and parts of Akko local government area, reported that motorists do not have to join long queues, as both independent marketers and major dealers are dispensing fuel.

Daily Trust reports that only NNPC Limited retail stations in Gombe metropolis were selling fuel at N650 per litre. However, motorists spend long hours in queues before they can purchase the product from those outlets.

Sani Ahmed, a resident, expressed his frustration, saying, "I bought fuel this morning at N780 per litre. All the NNPC outlets where one can get it at a lower price are shutdown, and only a few are dispensing fuel. You have to spend all day in the queue before you can get it."

In Adamawa, NNPC filling stations are selling fuel at a relatively lower price of N630 per litre, but even at such stations, long queues were a common sight.

Findings showed that black marketeers, taking advantage of the scarcity, were selling fuel at the rate of N1,100 per litre. Independent marketers fall in between, selling at around N800 per litre, with some stations charging as high as N850.

Artificial scarcity in parts of Port Harcourt

In some parts of Port Harcourt, Rivers State, motorists complained of artificial fuel scarcity.

Along the popular Aba-Port Harcourt Road, our reporter observed that while some fuel stations were open for business, others remained locked up.

Peter Okeah, a resident said: "There is an artificial scarcity of the product. Some stations are open for business while others are under lock and key. Those that are open are selling fuel at N750 per litre."

In Kogi State, many fuel stations said they have depleted their stock, leaving only a few dispensing the product as of Sunday afternoon.

Our correspondent reports that the pump prices vary significantly across different areas of the state.

Along the Lokoja-Abuja highway, particularly in the Felele-Lokoja area, fuel dealers are charging between N850 and N900 per litre. In the main town, prices range from N900 to N950 per litre.

The fluctuating availability of fuel has also impacted black market prices. A motorcycle rider, Yusuf Abimaje, said he purchased a litre of petrol at Ganaja village, a suburb of Lokoja, for N1,000 on Sunday when he ran out of fuel.

In Ilorin, the Kwara State capital, the scarcity has led to queues at several NNPC filling stations, particularly in areas like Surulere, Adewole, and Asa Dam. These stations are selling fuel at the official rate of N580 per litre, which is relatively stable compared to other locations.

The 'black market' has seen prices soar between N1,000 and N1,300 per litre, indicating severe exploitation amid the scarcity.

Motorists like Wahab Akanji called on the federal government to ensure equitable distribution of fuel to both independent and major marketers.

Ismail Ayodeji, the state chairman of the Sports Writers Association of Nigeria (SWAN), urged NNPC and marketers to collaborate effectively to avoid exacerbating the hardships faced by the populace with arbitrary fuel price hikes.

No queues in Benue, Taraba

In Benue State, particularly in Makurdi, the state capital, there have been no significant queues observed at filling stations as of Sunday evening. However, motorists were purchasing fuel at varying prices depending on the station.

A driver named Aliba Jones, waiting to refuel at Rain Oil, noted that while there was some initial apprehension about fuel scarcity in the past few days, the situation currently appears normal in Makurdi.

However, black marketers exploited the situation by selling fuel at exorbitant prices ranging between N870 and N900 per litre.

Also in Taraba State, particularly in Jalingo, there is no fuel scarcity as most filling stations, including the major ones, were selling fuel yesterday without significant queues.

By Seun Adeuyi, Adam Umar (Abuja), Salim U. Ibrahim (Kano), Dotun Omisakin (Lagos), Hassan Ibrahim (Bauchi), Haruna G. Yaya (Gombe), Victor Edozie (Port

Harcourt), Tijani Labaran (Lokoja), Tosin Tope (Akure), Amina Abdullahi (Yola), Tijjani Ibrahim (Katsina), Mumini Abdulkareem (Ilorin), Hope Abah (Makurdi), Magaji I. Hunkuyi (Jalingo)-Daily Trust.

South Africa: Impoverished Joburgers Buckle Under New Monthly R200 Prepaid Meter Fixed Electricity Surcharge

The cost of prepaid electricity is becoming a heavy burden for Johannesburg residents after the introduction of the R200 monthly fixed charge that will go towards maintaining electricity infrastructure.

Listen to this article 14 min Listen to this article 14 min It has been a week since the implementation of a R200 monthly fixed charge by City Power, and poorer residents are already feeling it hit their pockets. Now the move faces not only pushback, but also possible litigation.

The move came into effect on 1 July, along with the 12.7% electricity hike that has left many residents in a tight financial position. Both the hike and surcharge were approved by the National Energy Regulator of South Africa (Nersa) following City Power's application.

The fixed rate is intended to provide revenue to fund Johannesburg's investment into new electricity infrastructure and the maintenance of existing infrastructure. Before 1 July, prepaid residential customers did not contribute to these costs, only post-paid customers.

While R200 may seem a small sum to middle- or high-income earners, for millions of Joburg's poor and unemployed residents it means going a week without a meal.

This is the case for mother of two, Witney Phiri of Pimville, Soweto, who survives on R1,060 a month in child social grants - almost half of it goes towards buying electricity.- Daily Maverick.

Kenya: EU-Kenya Trade Agreement Takes Effect

The EU-Kenya Economic Partnership Agreement (EPA) has officially taken effect, in a major boost to the EU-Kenya trade.

The agreement aims to enhance bilateral trade in goods, boost investment flows, strengthen ties between the two partners, and foster mutually beneficial economic relations sustainably, promoting job creation and economic growth.

Notably, the EU-Kenya EPA is the most ambitious sustainability-focused deal negotiated with an African nation.

It includes binding provisions on labor issues, gender equality, environmental protection, and the fight against climate change.

Kenya, East Africa's primary economic hub, holds significant potential for growth in EU-Kenya trade relations.

The agreement is expected to unlock new economic opportunities, with the EU being Kenya's largest export destination and second-largest trading partner.

In 2023, total trade between the EU and Kenya reached €3 billion, a 16 percent increase from 2018.

The EPA is set to create more opportunities for Kenyan businesses and exporters by fully opening the EU market to Kenyan products and encouraging EU investment in Kenya through increased legal certainty and stability.

The Economic Partnership Agreement between the EU and Kenya was concluded in June 2023 and signed by both parties on December 18, 2023.

It aims to implement the provisions of the EU-East African Community (EAC) EPA and remains open to other EAC countries.

The EPA's ambitious commitments align with the EU's 2021 Trade Policy Review and its trade policy with Africa, aiming to deepen and expand existing trade agreements with African countries while enhancing their sustainability objectives.-Business Day Africa.

Malawi: Report Reveal That Most Malawians Dont Have Proper Jobs, Many Depend On Maganyu

A March 2024 European Commission report monitoring Malawi's economy says many people in Malawi depend on piecework for a living.

The report is titled 'Turning the Corner: Healthy Watersheds for a Strong Economy.'

It was published on March 1, 2024.

The report says that the Malawi economy is still struggling to recover fully from the impacts of recent pandemics.

It says this slow progress is being felt by the population.

According to the report, the share of Malawians working in information employment increased for the first time in nearly two years, driven primarily by an increased reliance on family farming and ganyu.

"There has been a slight uptick in the percentage of people working as casual labourers since May 2023, but it's still well below pre-pandemic levels," reads part of the report.

According to the report, this appears to be driven by an increase in people working on family farms rather than finding salaried jobs.

Commenting on the report, Scotland-based economist Velli Nyirongo said the trend highlights a worrying decline in formal opportunities, which have historically been a significant source of income for many Malawians.

The reduction in these jobs, along with their decreased financial rewards, indicates ongoing economic hardship.

He said to address these challenges, the government should prioritize initiatives that help informal businesses transition to the formal sector.

By providing access to credit, training and legal advice, these programs can empower informal business operators while also increasing the national tax base, he said.

He also said investment in rural development projects shows significant promise.

The report has suggested policy priorities like bolstering macroeconomic stability, tightening fiscal governance reforms and successful external debt restructuring as a route to creation of more formal job opportunities.

The report also highlights export-led growth as key to turning around the situation.

"Government should strengthen the functioning of agricultural markets," it says, adding that the implementation of the Disaster Risk Management Act of 2023 will be key to enhancing preparedness for future disasters and strengthening resilience.-Nyasa Times.

Senegal Sets Out to Secure Fairer Partnerships in Mining Sector

Senegal's recently elected president, Bassirou Dioumaye Faye, has promised to renegotiate mining, gas and oil contracts signed with foreign companies. At a top-level summit in Paris this week, his mining minister set out how the new government plans to break away from old practices and alliances.

Speaking at this year's Mining on Top Africa (Mota) conference, Birame Souleye Diop, Senegal's minister of energy and mines, said his government intends to review the contracts of mining companies that do not fulfil their environmental obligations.

"A few days ago, I visited Kedougou," Diop said, referring to the region that houses most of Senegal's industrial and artisanal gold mines.

Located 700 km east of the capital, Dakar, and close to the Malian border, it is one of the country's poorest regions. It is also subject to widespread contamination.

"The water of Falame river is totally polluted, animals are dying, children are dying, forests have been decimated," Diop said.

"This because of poisoning by cyanide and mercury used for gold mining. This is not fair."

Beyond European investment

The environmental degradation in Kedougou has been documented for years now. According to the Institute for Security Studies, 3.9 tonnes of mercury is used in the region every year, creating health risks for miners and residents alike.

Immediately after taking office in April, President Faye ordered an audit of Senegal's oil, gas and mining sectors.

"Our partners in the extractive industries are obliged to respect all the clauses of the contracts and we, as a state, have the responsibility to intervene and restore public order," Diop told the mining companies, government leaders and experts attending the Mota conference on 3 and 4 July.

The annual meeting aims to foster partnerships between Europe and Africa.

But the Senegalese minister told the delegates in Paris that he did not intend to limit the search for potential investors to Europe only.

"We need to find what's best for us. And, if it is in my country's interest to partner with Saudi Arabia, I'll go there," he said.

Give and take

Local communities must also be able to benefit from the exploitation of their land, Diop insisted, saying that a percentage of profits should be poured back into projects to benefit residents.

"It is not enough just to give jobs to the local population. We need to focus where the need is. There is no use for a mining company to build a hospital when it's schools which are needed," said Diop.

He added that, in the past, Senegal would simply accept what the companies investing in the country were willing to give to the local population. This is no longer the case, he said.

Diop also insisted that foreign companies should share technology with Senegal rather than simply extracting its primary materials.

"They take our resources, they transform them and they sell them back to us," he told RFI.

Keeping mineral wealth in Africa

Senegal began producing oil for the first time in June, with eventual capacity estimated at more than 200,000 barrels per day.

The country is also rich in minerals such as phosphate, iron ore, zircon and gold.

Diop claims that French investors involved in exploration have a clearer picture of Senegal's mineral reserves than the government does.

"They have the data, but they haven't shared it with me. What kind of generosity are we talking about? Transformation also means knowing what's in your subsoil," he said.

African states set up the African Minerals Development Centre in 2016 to help them better reap the benefits of their mineral resources. But only a handful of countries so far have ratified its founding statute, meaning the centre hasn't been put into full operation.

"Before being convinced that we need Europe, I think we should at least start by talking among ourselves, Africans, first," Diop said.-RFI website.

Nigeria: Amnesty International Questions Nigeria's Choice of Shell Evaluators

Abuja, Nigeria — Human rights group Amnesty International raised concerns Friday about the Nigerian government's hiring of two firms with past dealings with Shell to assess the proposed $2.4 billion sale of the company's onshore assets in the Niger Delta.

Amnesty said the choice cast doubt on the independence and transparency of the process and called again for accountability in the proposed sale.

Amnesty described the hiring of the Boston Consulting Group, or BCG, and S&P Global by the Nigerian oil regulator as "concerning," saying the firms are in business with Shell.

Amnesty said S&P Global plays a role in rating Shell's debt and credit worthiness, while BCG performs a variety of services for Shell.

Amnesty's Isa Sanusi said that BCG and S&P could be influenced by their commercial interests and that they may become lenient in their review of problems caused by Shell's activities.

"I don't think that it is possible for these companies to be independent," Sanusi said. "In fact, the whole exercise of assessing Shell's plan has now been jeopardized by this conflict of interest. There's no way a company working for Shell can be hired to examine the books of Shell. I don't think that is right."

In January, Shell announced plans to sell its onshore properties to a local consortium of five companies for $2.4 billion. Shell said the move would enable it to focus on more-profitable offshore business as it plans to transition away from fossil fuels.

But the proposed sale has sparked concern among environmental and human rights activists calling on authorities to delay the deal until a review of Shell's activities and assets in the region is done.

The groups say years of exploration by Shell have caused massive environmental damage and a loss of livelihoods for residents.

Energy expert Emmanuel Afimia agreed with Amnesty International, saying, "The consultants have existing relationships with Shell. This might compromise the consultants' ability to conduct an impartial review.

"We need to understand that the independence of these consultants is crucial to ensure a fair assessment, and their ties to Shell could undermine trust in the process," she said.

Nigerian law mandates Shell provide money for cleanup and decommissioning of its assets before exiting.

But Shell, like other foreign energy firms, has often blamed sabotage and theft for oil spills. Earlier this year, the company released on its website a list of eight cleanup operations it planned to carry out -- all for spills of less than 100 barrels of oil.

Amnesty said that unless the right thing is done, enormous human rights risks are at stake.

"There must be an examination of all the environmental liabilities, community liabilities and human rights liabilities," Sanusi said. "Shell has to pay for it before going ahead to sell its assets in the region. It is about human life, and that should be the priority of Nigerian authorities."

In March, the Netherlands-based nonprofit Center for Research on Multinational Corporations accused Shell of trying to avoid responsibility for oil spills and warned that if allowed, it could set a negative example for other foreign firms seeking to leave the Niger Delta.- VOA.

Boeing to plead guilty to criminal fraud charge

Relatives of people killed on Boeing planes have pressured the Department of Justice to prosecute the firm

Boeing has agreed to plead guilty to a criminal fraud conspiracy charge after the US found the company violated a deal meant to reform it after two fatal crashes by its 737 Max planes that killed 346 passengers and crew.

The Department of Justice (DoJ) said the plane-maker had also agreed to pay a criminal fine of $243.6m (£190m).

However, the families of the people who died on the flights five years ago have criticised it as a "sweetheart deal" that would allow Boeing to avoid full responsibility for the deaths.

The settlement must now be approved by a US judge.

By pleading guilty, Boeing will avoid the spectacle of a criminal trial - something that victims' families have been pressing for.

The company has been in crisis over its safety record since two near-identical crashes involving 737 Max aircraft in 2018 and 2019. It led to the global grounding of the plane for more than a year.

In 2021, prosecutors charged Boeing with one count of conspiracy to defraud regulators, alleging it had deceived the Federal Aviation Administration (FAA) about its MCAS flight control system, which was implicated in both crashes.

It agreed not to prosecute Boeing if the company paid a penalty and successfully completed a three-year period of increased monitoring and reporting.

But in January, shortly before that period was due to end, a door panel in a Boeing plane operated by Alaska Airlines blew out soon after take-off and forced the jet to land.

No-one was injured during the incident but it intensified scrutiny over how much progress Boeing had made on improving its safety and quality record.

In May, the DoJ said it had found Boeing had violated the terms of the agreement, opening up the possibility of prosecution.

Boeing's decision to plead guilty is still a significant black mark for the firm because it means that the company - which is a prominent military contractor for the US government - now has a criminal record. It is also one of the world's two biggest manufacturers of commercial jets.

It is not immediately clear how the criminal record will affect the firm's contracting business. The government typically bars or suspends firms with records from participating in bids, but can grant waivers.

However, Paul Cassell, a lawyer representing some families of people killed on the 2018 and 2019 flights, said: "This sweetheart deal fails to recognise that because of Boeing’s conspiracy, 346 people died.

"Through crafty lawyering between Boeing and DoJ, the deadly consequences of Boeing’s crime are being hidden."

He called on the judge assessing the deal to "reject this inappropriate plea and simply set the matter for a public trial, so that all the facts surrounding the case will be aired in a fair and open forum before a jury”.

In a letter to the government in June, Mr Cassell had urged the DoJ to fine Boeing more than $24bn.

Ed Pierson, executive director of Foundation for Aviation Safety and a former senior manager at Boeing, said the plea was "seriously disappointing" and "a terrible deal for justice".

"Instead of holding individuals accountable, they’re just basically giving them another get out of jail free card,” he said.

A Boeing 737 Max plane operated by Indonesia's Lion Air crashed in late October 2018 shortly after take-off, killing all 189 people on board. Just months later, an Ethiopian Airlines plane crashed, killing all 157 passengers and crew.

In the 2021 deal, Boeing also agreed to pay $2.5bn to resolve the matter, including a $243m criminal penalty and $500m to a victims' fund.

The deal outraged family members, who were not consulted on the terms and have called for the company to stand trial.

Senior staff at the DoJ recommended in favour of prosecution, CBS News, the BBC's US news partner reported in late June.

At a hearing in June, Senator Richard Blumenthal said he believed there was "near overwhelming evidence" that prosecution should be pursued.

Lawyers for family members said the DoJ was worried it did not have a strong case against the firm.

Mark Forkner, a former Boeing technical pilot who was the only person to face criminal charges arising from the incident, was acquitted by a jury in 2022. His lawyers had argued he was being used as a scapegoat.

Mark Cohen, a professor emeritus at Vanderbilt University, who has studied corporate punishments, said prosecutors often prefer plea deals or deferred prosecution agreements, which allow them to avoid the risk of a trial and can give the government greater power over a company than a typical sentence.

"Because it's easier to get than going to trial, it may ease the burden on the prosecutor but the prosecutor also may believe it's a better sanction [because] they may be able to impose requirements that aren't normally in sentencing guidelines," he said.

He said there was little doubt that Boeing's status as a key government contractor played a role in determining how to proceed.

"They've got to think about the collateral consequences," he said. "You don't take these kinds of cases lightly."

The issues with MCAS were not Boeing's first brush with the law.

It has also paid millions in penalties to the Federal Aviation Administration since 2015 to resolve a series of claims of improper manufacturing and other issues.

The company also continues to face investigations and lawsuits sparked by the incident on the January Alaska Airlines flight.-BBC

Hollywood icon Paramount agrees $28bn merger deal

One of Hollywood's oldest companies, Paramount Global, has agreed to merge with independent film studio Skydance Media.

Under the deal, Paramount's non-executive chair Shari Redstone will sell her family's controlling stake in the company in a complex transaction that will result in a new firm worth around $28bn (£21.9bn).

It marks the end of an era for the Redstone family, whose late patriarch, Sumner Redstone, transformed a chain of drive-in cinemas into a vast media empire.

As well as Paramount, the group includes the television networks CBS, Comedy Central, Nickelodeon and MTV.

"Our hope is that the Skydance transaction will enable Paramount’s continued success in this rapidly changing environment," Ms Redstone said in a statement.

According to the company its TV channels have a global reach of over 4.3 billion subscribers across more than 180 countries.

The merger would combine Paramount, home of classic films such as Chinatown and Breakfast at Tiffany's, with its financial partner on several recent big releases, including Top Gun: Maverick and Star Trek Into Darkness.

Under the agreement, Skydance will invest around $8bn in Paramount, including paying $2.4bn for National Amusements, which controls the group.

National Amusements owns just 10% of Paramount Group's shares but accounts for almost 80% of its voting rights.

Paramount said it expected to close the deal by the summer of next year.

Paramount Global traces its origins back more than a century to the founding of Paramount Pictures Corporation in 1914.

The studio has made many hit films, including the Godfather, Star Trek, and Mission: Impossible series.

But the entertainment giant has struggled over the past decade. Paramount Global's shares have fallen by more than 75% in the last five years.

Skydance is owned by David Ellison, the son of Larry Ellison, who founded US technology giant Oracle.

The announcement came after eight months of negotiations that saw Redstone holding talks with a number of potential partners including Sony and private equity firm Apollo.

In April, Paramount's chief executive Bob Bakish left the company after clashing with Ms Redstone over the planned Skydance deal.

The deal comes as the global entertainment industry is being transformed by the video-streaming revolution.-BBC

I had to downgrade my life' - US workers in debt to buy groceries

Stacey Ellis, a lifelong Democrat from Pennsylvania, should be the kind of voter that US President Joe Biden can count on.

But after four years of rising prices, her support has worn thin – and every time she shops at the supermarket, she is reminded how things have changed for the worse.

Ms Ellis works full-time as a nurse’s assistant and has a second part-time job.

But she needs to economise. She has switched stores, cut out brand-name items like Dove soap and Stroehmann bread, and all but said goodbye to her favourite Chick-fil-A sandwich.

Still, Ms Ellis has sometimes turned to risky payday loans (short-term borrowing with high interest rates) as she grapples with grocery prices that have surged 25% since Mr Biden entered office in January 2021.

"Prior to inflation," she says, "I didn't have any debt, I didn't have any credit cards, never applied for like a payday loan or any of those things. But since inflation, I needed to do all those things....I’ve had to downgrade my life completely."

The leap in grocery prices has outpaced the historic 20% rise in living costs that followed the pandemic, squeezing households around the country and fuelling widespread economic and political discontent.

"I’m a Democrat," says Ms Ellis, who lives in the Philadelphia suburb of Norristown. "I love voting for them. But Republicans are speaking volumes right now and Democrats are whispering."

“I want somebody to help me, help the American people," she adds. “Joe Biden, where are you?”

For the president, already contending with serious doubts about his age and fitness for another term, the cost-of-living issue presents a major challenge, threatening to dampen turnout among supporters in an election that could be decided, like the last two, by several tens of thousands of votes in a handful key states.

Grocery prices have surged 25% since Joe Biden entered office

Across the country, Americans on average spent more than 11% of their incomes on food, including restaurant meals last year – a higher proportion than any time since 1991.

The jump in food prices has hit younger, lower-income and minority households - key parts of the coalition that helped Mr Biden win the White House in 2020 - especially hard.

But worries about the issue are widespread: a Pew survey earlier this year found that 94% of Americans were at least somewhat concerned about rising food and consumer goods prices.

That was nearly identical to two years earlier, even though the staggering jumps in food prices that hit the US and other countries after Russia's 2022 invasion of Ukraine have subsided.

Dylan Garcia, a 26-year-old security guard from Brooklyn, says he’s never struggled to buy groceries as much as he has now.

Instead of the fresh food and brand-name items he used to enjoy, he now stocks up on ramen noodles and frozen vegetables - and only eats twice a day because he can't afford more.

At checkout, he routinely uses "buy now, pay later” schemes, which allow him to pay the bill in installments, but have led to mounting debt.

“I’m stuck in a loop,” he says. “It’s become an insecurity to pull up my phone at the register and have to use these programmes. When they see me, it’s embarrassing.”

Mr Garcia, who has long voted for Democrats, says his precarious financial situation has made him lose hope in politics and he does not plan to vote in November's election.

“I don’t think the government has our best interest and I don’t think they care,” he says.

John Wirick Trump voter Katie Walsh applies make-up John Wirick

Trump voter Katie Walsh says her makeup business slowed as people cut back

The White House maintains Mr Biden has been engaged on issues of food affordability, fighting to increase food stamp benefits and other government aid, initiatives opposed by Republicans.

At last month's presidential debate, the first question was on inflation, and Mr Biden sought to shift blame to big companies, accusing them of price gouging – a claim that is hotly disputed among economists.

But despite strong job creation and low unemployment, opinion polls show voters continue to trust Mr Biden's opponent, former President Donald Trump, more on economic issues.

On the CNN debate stage, the Republican White House candidate blamed Mr Biden for stoking inflation, which the White House denies, and said: “It's killing people. They can't buy groceries anymore. They can’t.”

The Trump campaign in turn denies that policies he proposes - including a 10% tariff on all goods coming into the US - would worsen price rises, as many analysts predict.

"We believe that a second Trump term would have a negative impact on the US's economic standing in the world, and a destabilizing effect on the US's domestic economy," wrote 16 Nobel prize-winning economists in an open letter last month.

Republicans have accused Mr Biden of trying to mislead the public about the extent of the inflation problem, noting that Mr Biden has claimed, incorrectly, that inflation was already at 9% when he entered office. It was 1.4%.

Katie Walsh, a makeup artist in Pennsylvania, voted for Trump in 2020 and says she plans to do so again, based on his economic record.

The 39-year-old says her family has struggled to keep up with inflation, especially since her business has slowed, as people squeezed by higher prices cut back.

"I know he's a big fat mouth," she says of Mr Trump. "But he at least knows how to run the economy."

handout Stephen Lemelinhandout

Stephen Lemelin, a Michigan Democrat, says his grocery bill is getting lower

Analysts say it is clear that the economy is important to voters, but less clear it will prove decisive in the November election.

In 2022, when inflation was at its worst, Democrats did better than expected in mid-term elections, as concerns about abortion access drove supporters to the polls.

This time around, issues such as immigration and fitness for office are also top of many voters' minds, while economic trends appear to be moving in the right direction.

Grocery prices were up just 1% over the past 12 months, well within historic norms; and the cost of a few items, including rice, fish, apples, potatoes, and milk, has even come down a bit.

As major chains such as Target, Amazon and Walmart announce price cuts in recent weeks, there are signs the situation could continue to improve.

Some analysts also expect wages, which have increased but trailed the leap in overall prices, to finally catch up this year, providing further relief.

“We’re on the right track,” says Sarah Foster, who follows the economy for Bankrate.com. “Wage growth has slowed, price growth has slowed but, you know, prices are slowing at a much faster rate than wages.”

Stephen Lemelin, a 49-year-old father of two from Michigan, another electoral battleground, says he was pleasantly surprised by lower prices on a recent supermarket trip.

Whatever his concerns about the economy, the military veteran says his support for Mr Biden, who got his vote in 2020, has never been in doubt, given that he sees Trump as a threat to democracy.

“Nobody likes high interest rates or high inflation but that’s not under presidential control,” he says. “If you know politics, there’s really only one choice.”-BBC

US jobs growth in June beats expectations

US jobs growth slowed last month although the economy still created more posts than expected, official figures show.

Employers added 206,000 jobs in June, while the number of jobs created in May was revised down to 218,000 from the previous estimate of 272,000.

The US unemployment rate edged up to 4.1%, while wage growth rose at its slowest for three years.

Analysts said the figures could take the US central bank, the Federal Reserve, a step closer to cutting rates later this year.

Economists had forecast that the US economy would add 190,000 jobs in June.

Emily Bowerstock Hill, the chief executive of Bowerstock Capital Partners, said the figures were "relatively benign".

"The data isn't bad enough to alarm markets, and not bad enough to worry the Fed," she said.

She added that the Fed has "very clearly telegraphed they are expecting one cut" this year.

US interest rates were held again at 5.25%-5.5% in June, a range they have been in since July last year.

In the minutes of the US central bank's latest meeting, which were published on Wednesday, policymakers acknowledged the economy appeared to be slowing and that "price pressures were diminishing".

US Fed pencils in one interest rate cut this year

Financial markets are betting on a roughly 72% probability of a rate cut at the Fed's September meeting, and traders are also pricing in a rising chance of a second rate cut in December.

However, in June officials scrapped a March forecast that interest rates would fall by three-quarters of a percentage point this year, which would have meant cuts beginning this summer and continuing through the run-up to the US presidential election on 5 November.

In June, with the rate of price rises "stickier" than expected, and a jobs market that figures suggested was strong, the Fed changed its outlook to there being a single quarter-point cut this year.

Central banks around the world tend to follow the Fed's lead in cutting rates, although Bank of England governor Andrew Bailey said in May that "there is no law that the Fed has to go first".-BBC

Samsung expects profits to jump by more than 1,400%

3 Widespread adoption of AI has led to a surge in demand for advanced computer chips

Samsung Electronics expects its profits for the three months to June 2024 to jump 15-fold compared to the same period last year.

An artificial intelligence (AI) boom has lifted the prices of advanced chips, driving up the firm's forecast for the second quarter.

The South Korean tech giant is the world's largest maker of memory chips, smartphones and televisions.

The announcement pushed Samsung shares up more than 2% during early trading hours in Seoul.

The firm also reported a more than 10-fold jump in its profits for the first three months of this year.

In this quarter, it said it is expecting its profit to rise to 10.4tn won ($7.54bn; £5.9bn), from 670bn won last year.

That surpasses analysts' forecasts of 8.8tn won, according to LSEG SmartEstimate.

"Right now we are seeing skyrocketing demand for AI chips in data centers and smartphones," said Marc Einstein, chief analyst at Tokyo-based research and advisory firm ITR Corporation.

Optimism about AI is one reason for the broader market rally over the last year, which pushed the S&P 500 and the Nasdaq in the United States to new records on Wednesday.

The market value of chip-making giant Nvidia surged past $3tn last month, briefly holding the top spot as the world's most valuable company.

"The AI boom which massively boosted Nvidia is also boosting Samsung's earnings and indeed those of the entire sector," Mr Einstein added.

Samsung Electronics is the flagship unit of South Korean conglomerate Samsung Group.

Next week, the tech company faces a possible three-day strike, which is expected to start on Monday. A union of workers is demanding a more transparent system for bonuses and time off.-BBC

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