Major International Business Headlines Brief::: 09 July 2024

[Bulls n Bears]

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Major International Business Headlines Brief:::  09 July 2024 

 


 


 

	
 


 

 


 

ü  Nigeria's Debt-to-GDP Within World Bank/IMF Ceiling - DMO

ü  Kenya: High Court to Hear Petition On Nomad Energy Limited Liquidation

ü  Nigeria: Govt Committed to Workers' Rights, Decent Wage - Labour Minister

ü  Nigeria: Global Food Prices Steady in June, Cereal Production Hit Record
High - FAO

ü  Uganda: Con Men Swarm Hoima Stadium Project

ü  Kenya: Moody's Downgrades Kenya Over Fiscal Strategy Concerns

ü  Uganda: FINCA Commits to Championing Financial Independence in Refugee
Settlements

ü  Nigeria: Petrol Queues - Stations to Operate Longer Hours, Share Stock -
NNPC

ü  South Africa: Municipalities' R78 Billion Eskom Debt an 'Urgent Task' -
Ramokgopa

ü  Kenya: Speaker Wetangula Rejects MP's Bid to Repeal Finance Bill 2024

ü  China Tesla rival BYD signs $1bn Turkey plant deal

ü  'Protectionism eroding global business' - world trade chief

 


 

 


 <mailto:zitfmktg at zitf.co.zw> Nigeria's Debt-to-GDP Within World Bank/IMF
Ceiling - DMO

The Debt Management Office (DMO) said Nigeria's debt-to- Gross Domestic
Product (GDP) ratio is within the specifications of the World Bank and
International Monetary Fund (IMF) for the country's peer group.

 

The Director-General of the DMO, Patience Oniha, said this in an interview
with the News Agency of Nigeria (NAN) on Tuesday in Abuja.

 

Oniha was reacting to some media reports that the debt-to-GDP ratio of 52
per cent exceeded the World Bank/IMF's prudential ceiling for countries in
Nigeria's peer group.

 

She explained that the prudential ceiling for such countries was 55 per
cent, and not 40 per cent.

 

 

Oniha highlighted that improvement in revenue generation was crucial for the
country to achieve accelerated socio-economic development and debt
sustainability.

 

According to her, recent policies by the Federal Government to focus more on
revenue generation are the right steps that could reduce the country's debt
burden.

 

"We cannot discuss growth, development, or debt without giving due
consideration to revenue.

 

"It is now imperative that we confront revenues and take decisive actions to
further strengthen our revenue streams from all sources," she said.

 

She urged the Federal Government to prioritise fiscal retrenchment while
assuring that the various measures to attract foreign exchange inflows would
increase external reserves and support the naira exchange rate.

 

Recall that the DMO recently announced that the country's total debt stock
increased to N121.67 trillion in March, from N97.34 trillion in December
2023, indicating an increase of N24.33 trillion.

 

She said the increase was partly due to exchange rate fluctuations as well
as securitisation of N4.90 trillion as part of the securitisation of the
N7.3 trillion Ways and Means Advances approved by the National Assembly.

 

She, however, clarified that the total debt stock included the domestic and
external debt stock of the 36 states and the Federal Capital Territory
(FCT).

 

- Vanguard.

 

 

 

 

Kenya: High Court to Hear Petition On Nomad Energy Limited Liquidation

Nairobi — The Nairobi High Court is set to hear a petition for the
liquidation of Nomad Energy Limited in October this year, following a
three-year delay.

 

The petition was presented before the High Court of Kenya, Milimani Law
Courts Nairobi, by Kopo Kopo Inc., c/o Rilani Advocates, on November 13,
2020.

 

In a notice dated July 1st, 2024, the court said that the petition would be
heard by the High Court's Commercial and Tax Division before Justice Sifuna
Nixon on October 28th, 2024, at 9:00 a.m.

 

"NOTICE is given that a petition for the insolvency/liquidation of the
above-named company by the High Court of Kenya at Milimani Law Courts,
Nairobi, was on the 13th of November 2020, presented to the said Court by
Kopo Kopo Inc.(Cr.). c/o Rilani Advocates LLP, suite A6, 1st-floor Riara
Centre, Rirar Road, p.o Box 25518-00100, NAIROBI," the notice stated.

 

Furthermore, the court has alerted that any creditor or contributor of the
company that may desire to support or oppose the making of an order on the
petition should give a notice to the petitioner's advocate not later than
4:00 p.m. in the afternoon before the petition is to be heard and appear.

 

"In person, or by his advocate, for that purpose, and a copy of the petition
will be furnished by the under-designed to any creditor to contribute of the
said company requiring such copy on payment of the regulated charge for the
same," it stated.

 

- Capital FM.

 

 

 

 

Nigeria: Govt Committed to Workers' Rights, Decent Wage - Labour Minister

Minister of State for Labour and Employment, Hon. Nkeiruka Onyejeocha, has
sought collaboration efforts to create a conducive working environment and
productivity in the country's labour ecosystem.

 

The minister also reaffirmed the federal government's commitment to
upholding the rights and well-being of all workers, ensuring they receive
fair treatment, safe working conditions, and a decent income that aligns
with their needs and contributions.

 

In a keynote address at a one-day retreat on labour reforms and living wage
in Nigeria, Onyejeocha stressed the need for collaborative efforts with the
National Assembly to enact pro-worker legislation and reforms.

 

 

The retreat, organised by the National Institute of Legislative and
Democratic Studies (NILDS), brought together stakeholders from various
economic sectors to discuss labour reforms and the living wage in Nigeria.

 

The minister reiterated the government's commitment to ensuring fair labour
practices, safe working environments, and a living wage for all workers.

 

She acknowledged the crucial role of legislative intervention and expressed
gratitude for the support of the National Assembly Committees on Employment,
Labour, and Productivity.

 

In a statement issued by her media aide, Gabriel Emameh, the minister, urged
the lawmakers to sponsor and pass bills that reflect the yearnings of the
labour force, fostering productivity, growth, and punishable labour law
violations.

 

 

She said, "Your legislative oversight and commitment to enacting laws that
protect and empower workers are vital to the success of our reform agenda.
Together, and as your colleague, we can do more and build a legal framework
supporting our vision for a just and equitable labour market.

 

"Let us come together to sponsor and pass bills that reflect the yearnings
of our labour force across all sectors. Let us create laws and policies that
foster productivity and growth amongst our workforce and measurably punish
offenders and violators of labour laws. This is the only pathway to true
reform."

 

On living wage, she explained that the tripartite committee's submissions on
a new national minimum wage were highlighted as a blueprint for actionable
reforms.

 

The minister added that the government's commitment to transforming the
labour landscape in Nigeria was reaffirmed, ensuring respect, protection,
and fair compensation for every worker. She further expressed optimism about
achieving the government's vision with continued support from stakeholders.

 

"The government of Nigeria, under the leadership of President Bola Ahmed
Tinubu, is unwavering in its dedication to ensuring that all workers are
treated with dignity, work in safe environments, and earn a living wage. Our
vision is clear: to create a labour market that is fair, equitable, and
capable of sustaining the aspirations of every Nigerian worker.

 

"Central to our efforts is the work of the Tripartite Committee, which
comprises government, organised private sector, and organised labour, and
has diligently engaged with stakeholders on the critical issue of a new
national minimum wage," she said.

 

In her concluding remarks, she said the Federal Ministry of Labour and
Employment flagship initiative, the Labour and Employment Empowerment
Programme (LEEP), represents a comprehensive approach to job creation and
labour reform. It features a dedicated component focused on enhancing labour
compliance and promoting robust labour standards.

 

- Leadership.

 

 

 

 

Nigeria: Global Food Prices Steady in June, Cereal Production Hit Record
High - FAO

The Food and Agriculture Organisation (FAO) has stated that the benchmark
for world food commodity prices remained stable in June.

 

The FAO Food Price Index, which track monthly changes in the international
prices of a set of globally-traded food commodities, averaged 120.6 points
in June, the same as its revised figure for May.

 

It explained that the June's index was 2.1 per cent lower than its
year-earlier value and 24.8 per cent below its March 2022 peak.

 

FAO Cereal Price Index declined by 3.0 per cent in June from May, with
quotations for coarse grains, wheat, and rice all down, driven in part by
improved production prospects in major exporting countries.

 

 

However, its Vegetable Oil Price Index rose 3.1 per cent from May, buoyed by
reviving global import demand for palm oil and firm demand from the biofuel
sector in the Americas for soy and sunflower oils.

 

"The FAO Sugar Price Index increased by 1.9 per cent from May after three
consecutive monthly declines, largely due to concerns over the likely impact
of adverse weather and monsoons on production in Brazil and India.

 

"The FAO Dairy Price Index rose by 1.2 percent, with international
quotations for butter reaching a 24-month high due to increased global
demand for near-term deliveries amidst strong retail sales, seasonally
falling milk deliveries in Western Europe, and low inventories in Oceania.

 

"The FAO Meat Price Index was virtually unchanged in June, as slight
increases in the world prices of ovine, pig and bovine meats nearly offset a
supply-led decline in international poultry meat prices," the statement
added.

 

Meanwhile, FAO updated its forecast for global cereal production in 2024,
pegging it at 2,854 million tonnes, a new all-time high.

 

- This Day.

 

 

Uganda: Con Men Swarm Hoima Stadium Project

Job is the name of their offering and in a country with half the population
being youthful or younger, a job offer is appealing.

 

Bugahya legislators Pius Wakabi has cautioned the public to be cautious of
falling for people asking for tokens in exchange for jobs in the ongoing
Hoima stadium construction project.

 

The Turkish contractors MS Summa has started site clearing, recruitment of
casual labourers, land surveys and soil testing for the stadium in Hoima
City.

 

But with the project has come a swarm of unscrupulous persons laying every
trap for unsuspecting members of the public.

 

 

Job is the name of their offering and in a country with half the population
being youthful or younger, a job offer is appealing.

 

Four kilometres off Hoima city on the Hoima-Masindi highway is Kyarwiru
village in Mparo, is the place that is set to host the multi-purpose
stadium.

 

Following contract signing with government led by Education and Sports
minister Janet Museveni on June 7, the contractor has started site clearing,
including soil testing, land survey, but also recruiting casual labourers.

 

MP Pius Wakabi has cautioned the natives to be wary of con men While the
representatives of the MS Summa at the site were not able to speak to us, MP
Wakabi - whose family donated the first 20 acres of land for the project -
said Parliament already passed the 30 percent of the propose budget, which
is Shs132 billion.

 

"While there were a lot of theories with people doubting that the stadium
may not be constructed, works you can see have started, and in about two
weeks all these activities of bush clearing, soil testing, recruitment of
casual labourers, and land survey will be done," Wakabi said.

 

 

He said the stadium will boost development in Bunyoro, especially in the
hotel and hospitality sector.

 

"Our children have already started getting jobs, I mean casual, those that
have qualification will be given real jobs in the construction project," the
MP added.

 

However, Wakabi cautioned people to be careful not to be duped by
unscrupulous persons to pay in exchange for jobs.

 

He said two weeks ago, an unnamed persons from Kampala started registering
people to join private security as stadium guards.

 

Those who fell for the scam were paying Shs50,000 each.

 

"When such developments come, crooks take advantage of the situation. Two
weeks ago a person came and asked people to pay each Shs50,000 that he was
going to take them to Kampala for training as security guards who will guard
the stadium," Wakabi said.

 

The con man reportedly left Hoima Shs50 million richer.

 

Julius Hakiza, the Albertine Region Police spokesperson, confirmed the
claims, saying they have started investigations into the matter.

 

"Some people started complaining and some recorded statements, we have
started investigations to ascertain how true the incident is," Hakiza said.

 

The real construction of Hoima stadium will be launched by President
Museveni on a date that is yet to be communicated.

 

The construction of the 20,000-seater Hoima stadium comes ahead of the 2027
Africa Cup of Nations that will be co-hosted with Kenya and Tanzania.

 

- Nile Post.

 

 

 

Kenya: Moody's Downgrades Kenya Over Fiscal Strategy Concerns

Moody's has downgraded Kenya's sovereign rating deeper into junk territory,
citing a diminished capacity to implement a fiscal consolidation strategy
after the government dropped the Finance Bill 2024, which was intended to
raise more revenue.

 

The downgrade to "Caa1" from "B3" reflects a significant decline in Kenya's
ability to implement revenue-based fiscal consolidation, which would have
improved debt affordability and placed it on a downward trend.

 

The credit ratings agency downgraded the country's local- and
foreign-currency long-term issuer ratings and foreign-currency senior
unsecured debt ratings.

 

 

"The government's decision not to pursue planned tax increases and instead
rely on expenditure cuts to reduce the fiscal deficit represents a
significant policy shift with material implications for Kenya's fiscal
trajectory and financing needs," Moody's said.

 

Last month, Kenyan President William Ruto withdrew planned tax hikes
following deadly protests in Nairobi and other parts of the country.

 

This left the proposed budget with a deficit of over Ksh300 billion. In
response, the government has implemented major spending cuts and called for
austerity measures to preserve cash.

 

Moody's stated that while the spending cuts should narrow the fiscal
deficit, it will be at a more gradual pace than previously assumed,
resulting in Kenya's debt affordability remaining weaker for longer.

 

Kenya's previous rating of "B3" was based on the government continuing with
a fiscal consolidation strategy that included significant revenue-raising
measures aimed at narrowing the fiscal deficit, containing the debt burden,
and stabilising debt affordability.

 

- Business Day Africa.

 

 

 

 

Uganda: FINCA Commits to Championing Financial Independence in Refugee
Settlements

FINCA Uganda has expressed commitment to integrating refugees into the
Ugandan economy and promote self-reliance.

 

For over a decade, Uganda has been a refuge for more than 1.5 million
displaced individuals fleeing conflict and persecution from neighboring
countries such as South Sudan, the Democratic Republic of Congo, Ethiopia,
and Somalia.

 

While this humanitarian gesture is commendable, the increasing influx of
refugees annually strains Uganda's resources, including land, water, and
social services.

 

According to Alice Lubwama, the grants and business development manager of
FINCA Uganda, they remain at the forefront of empowering refugees for a long
time.

 

 

"Over the years, we have actively worked to foster financial inclusion and
economic empowerment among refugees," Lubwama said.

 

"By collaborating closely with stakeholders, including the Government of
Uganda, international NGOs, and local authorities, FINCA has implemented
market-led interventions in key regions such as West Nile, Kiryandongo,
Mubende, and urban Kampala."

 

She added: "These interventions aim to facilitate better integration of
refugees into host communities, strengthen household resilience, stimulate
economic activity, and increase household incomes."

 

Lubwama says FINCA's approach is rooted in the belief that refugees should
be financially resilient and independent, with access to financial services
forming the foundation for future financial autonomy.

 

"By focusing on economic empowerment, FINCA allows vulnerable individuals to
live with dignity and contribute meaningfully to their host communities."

 

 

Lubwama further observes that one of the standout initiatives by FINCA is
the refugee inclusion program, which has already made significant strides.

 

Over 5,240 beneficiaries, 65 percent refugees and 35 percent host community
members have completed financial literacy training sessions under this
initiative according to Lubwama.

 

She noted that many participants have opened individual savings accounts,
while others have pooled their resources into group savings accounts to
accumulate lump sums for gradual development, ultimately improving their
livelihoods.

 

FINCA has invested over Shs1.6 billion to support these refugee initiatives,
providing loans to over 920 individual refugees and 15 SACCOs/VSLA groups
that include both refugees and host community members.

 

These loans target to enable refugees start and grow micro-businesses,
thereby fostering economic independence.

 

However, many refugees still rely on informal loans, which are often
expensive and can lead to a cycle of debt due to their precarious
circumstances and lack of access to formal financial services.

 

Lubwama notes that FINCA is determined to ensure that individuals and
businesses have convenient access to and can use affordable and suitable
financial products and services that meet their needs and improve their
lives.

 

She says this vision encompasses the responsible and sustainable provision
of loans, savings, and money transfer services.

 

"It is thus crucial for us to recognize that much work remains to be done.
However, the foundations we have laid provide a robust platform for further
expansion and deeper financial inclusion for refugees," Lubwama said.

 

"By continuing to support and invest in these programs, we can help build a
future where refugees are not just surviving but thriving, contributing to
and benefiting from the economic prosperity of their host communities."

 

- Nile Post.

 

 

 

 

Nigeria: Petrol Queues - Stations to Operate Longer Hours, Share Stock -
NNPC

"We are getting fuel stations to run for longer hours and we are getting
marketers to collaborate and share stocks..."

 

The Nigerian National Petroleum Company Limited (NNPC Ltd.) says fuel
stations should operate longer hours to supply and distribute petrol to
address the fuel queues across the country.

 

The NNPC Ltd said the turnaround period of petrol trucking is also elongated
to ease the situation being witnessed.

 

The Executive Vice President, Downstream of NNPC Ltd., Dapo Segun, said this
on Monday in Abuja during a joint inspection of stations by the firm and the
Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA)
officials.

 

 

The News Agency of Nigeria (NAN) reports that the NNPC Ltd. and the NMDPRA
embarked on a joint monitoring of the supply and distribution of fuel
stations in the FCT and across the country to ensure that queues disappear.

 

NNPC Ltd. had said that fuel queues in the FCT and parts of the country were
caused by disruptions in the ship-to-ship (STS) transfer of fuel between
Mother Vessels and Daughter Vessels resulting from recent thunderstorms.

 

It said adverse weather conditions, including rainstorms and lightning, had
also affected berthing at jetties, truck load-outs, and product
transportation to filling stations, disrupting station supply logistics.

 

Speaking during the inspection, Mr Segun said there was a gap in the
ship-to-shore discharge of petrol, which he described as a volatile liquid.
He added that during thunderstorms, it could not be discharged; rather, it
had to suspend ship-to-shore movement.

 

 

"This also affected the loading of trucks at the depot too because of safety
reasons. So we have to suspend all that during thunderstorms and that's why
you see this tightness.

 

"Though we have a challenge over the bad portions of motorways, which
deteriorated due to rains and floods across the country, we will ensure that
we are loading out all through the weekend and that we are mobilising
trucks.

 

"We are getting fuel stations to run for longer hours and we are getting
marketers to collaborate and share stocks, rather than have a station with
more trucks, they can release those trucks to other stations for
circulation," he said.

 

The Executive Director, Distribution Systems, Storage and Retailing
Infrastructure, NMDPRA, Ogbugo Ukoha, said the fuel queues in Abuja and
parts of Lagos arose from the inclement weather which affected operations
offshore and routes trucks ply.

 

When asked about its effort to stop hoarding and the nefarious activities of
black-marketers, Mr Ukoha said its officials were on the ground going
through the stations and depots to make sure that there was no hoarding.

 

"Due to the tightness in supply, there may be elements who will try to take
advantage of that. We assure Nigerians to go about their businesses and
purchase the volume they need without panic," he said.

 

Mr Ukoha said there was no intention or any anticipated plan to increase
pump price, adding that the two organisations would continue to collaborate
to ensure energy security.

 

On this background, he said, the authority had done its regulation on
national strategic stock and framework, adding that it was at the threshold
of operationalising the framework.

 

"Again, the sensitivity of the pump price is another matter. Once those
national strategic stocks are in place the logistic issues we have will be
mitigated to a large extent and stabilise both supply and prices," Mr Ukoha
added.

 

NAN reports that the team inspected fuel stations in the FCT, including the
NNPC Ltd. Retail Outlet at Katampe and the AP fuel station located at
Ibrahim Way, Garki 2, which had long queues.

 

The stations' managers also confirmed the availability of enough stock,
adding that the stations' pumps dispensed accurately and relied on constant
energy to dispense fuel to motorists.

 

Motorists on the ground also appealed to the government to find lasting
solutions and expressed mixed feelings as some have spent longer time
queuing for fuel while some did not waste time before their turns.

 

(NAN)

 

- Premium Times.

 

 

 

 

South Africa: Municipalities' R78 Billion Eskom Debt an 'Urgent Task' -
Ramokgopa

The R78 billion debt owed to Eskom by municipalities must be urgently
addressed to protect the ability of the power utility to fulfil its mandate.

 

This is according to Minister of Electricity and Energy, Dr Kgosientsho
Ramokgop,a who addressed the media on Monday.

 

"Collectively, municipalities are owing Eskom R78 billion and...a lot of
this is irrecoverable. There's no possibility under the sun that we are
going to collect that R78 billion. It's important that we resolve this
picture.

 

"This picture presents problems for Eskom. Eskom needs this money for it to
be able to reinvest back into its own infrastructure. Municipalities have to
pay that money...but on an objective ground, they simply don't have the
means to be able to pay," he said at the briefing held in Pretoria.

 

Ramokgopa said the current trajectory of the debt owed to Eskom poses a
threat to the existence of the power utility in the future.

 

 

"To give you the magnitude of the problem, if we don't resolve this problem,
our projection is that at the current rate, by 2050, Eskom will be owed R3.1
trillion. Eskom will collapse. Generation capacity is going to be
compromised. So, it's important that we resolve this question.

 

"This is the most urgent task that is confronting us. It is municipality
related but we can't fold our arms, we need to help them from a technical
point of view."

 

He emphasised that continued non-payment is affecting Eskom's ability to
address distribution infrastructure needs - leading to the implementation of
load reduction.

 

Load reduction is implemented in areas when the demand is higher than the
infrastructure is able to handle.

 

"In the solution, we must protect the interests of Eskom as a going concern,
ensure that municipalities are able to collect [revenue] but also protect
the interests of the user. Because when that distribution infrastructure
fails that is providing electricity to 50 houses, there'll be 10 to 20
houses that have been paying diligently but they are collateral damage.

 

 

"The biggest victims of all of that is the end consumer and, by definition,
is the South African economy," he said.

 

The Minister said the department, together with municipal leaders will
address the challenge of electricity affordability and access to allow
municipalities to be able to collect revenue.

 

"It is important that we must review electricity tariff models to enhance
affordability and expand access. Everyone must have access to electricity
and once they have access...make sure that they can afford it. That's
something that is going to receive our attention.

 

"Distribution is our albatross...it's on a mode of self-destruction and the
casualties are the poor. They are the ones that are subjected to conditions
of load reduction in the main and even those who are diligent payers are
subjected to load reduction.

 

"This can't continue any further. It's important that we arrest it so that
we are able to ensure that the country is able to achieve its developmental
objectives," he said.

 

- SAnews.gov.za.

 

 

 

 

Kenya: Speaker Wetangula Rejects MP's Bid to Repeal Finance Bill 2024

Nairobi — National Assembly Speaker Moses Wetangula has rejected Rarieda MP
Otiende Amollo's attempt to repeal the withdrawn Finance Bill 2024, stating
that only an Act of Parliament can be repealed.

 

Amollo's proposed Bill aimed to overturn the Finance Bill, which President
Ruto declined to sign into law following public outcry.

 

"The Finance Bill, 2024 is not an Act of Parliament and cannot become an Act
of Parliament by effluxion of time. Your proposed draft repeal Bill of the
Finance Bill, 2024 is therefore alien to the applicable legal instruments,"
Wetangula stated.

 

In response to widespread street protests, primarily by the youth, President
Ruto conceded to public demand and declined to assent to the controversial
Finance Bill.

 

 

Instead, he referred it back to the National Assembly with a recommendation
to delete all its clauses.

 

He sent a memorandum to the National Assembly suggesting the deletion of all
clauses in the Bill.

 

Speaker Wetangula subsequently directed members with concerns about
President Ruto's memorandum on the Finance Bill 2024 to address them through
committees.

 

"You are also at liberty to appear and prosecute your position before the
Committee on such date that it may schedule and further ventilate your
concerns when the report of the Committee is considered by the House," he
said.

 

Speaker Wetangula emphasized that Parliament has previously amended bills to
meet the President's request to delete all proposed clauses, underscoring
that house committees can only propose legislation to amend an Act of
Parliament.

 

 

The House Finance and National Planning Committee is handling the matter.
They are expected to present their report when the House returns from a
short recess on July 23.

 

The House will then have 21 days from that date to review and consider the
report.

 

Amollo's decision to draft the repeal Bill arose from the legal uncertainty
regarding the President's recommendation to delete a Bill already passed by
Parliament.

 

Speaker Wetangula clarified in his communication that President Ruto's
memorandum does not mention the "withdrawal of the Finance Bill."

 

He dismissed Amollo's assertion that the Finance Bill 2024 would
automatically become an Act after 14 days if not assented to.

 

"Upon presentation of a Bill for assent, the Constitution grants the
President 14 days within which to either assent to the Bill or refer it back
to Parliament for reconsideration. The assertion that the Finance Bill,
2024, shall come into force after 14 days is therefore patently incorrect
and misleading," Wetangula said.

 

The Finance Bill 2024 had already completed its legislative process in the
National Assembly, securing a simple majority in its third reading, the
final stage in the legislative house.

 

During the committee of the whole House, the Bill passed with 195 Members of
Parliament voting in its support.

 

The outcome sparked widespread violence during demonstrations, with the
government reporting over 25 deaths, while human rights activists claimed
the toll was 41 deaths and numerous injuries.

 

About The Author

 

DAVIS AYEGA

 

Davis Ayega is a versatile journalist, proficient in creative writing,
interviewing, and presenting. With a keen eye for detail, he demonstrates a
deep understanding of effective communication across diverse audiences.

 

  - Capital FM.

 

 

 

 

China Tesla rival BYD signs $1bn Turkey plant deal

China's biggest electric car maker BYD has agreed a $1bn (£780m) deal to set
up a manufacturing plant in Turkey, as it continues to expand outside its
home country.

The new plant will be able to produce up to 150,000 vehicles a year,
according to Turkish state news agency Anadolu.

 

The facility is expected to create around 5,000 jobs and start production by
the end of 2026.

The deal was signed at an event in Istanbul attended by President Recep
Tayyip Erdogan and BYD's chief executive Wang Chuanfu.

 

BYD did not immediately respond to a BBC request for further details on the
deal.

The announcement comes as Chinese EV makers face increasing pressure in the
European Union and the US.

Last week, the EU took action to protect the bloc's motor industry by
raising tariffs on Chinese EVs.

 

The decision saw BYD hit with an extra tariff of 17.4% on the vehicles it
ships from China to the EU, which was on top of a 10% import duty.

Turkey is part of the EU’s Customs Union, which means vehicles made in the
country and exported to the bloc can avoid the additional tariff.

The Turkish government has also taken action to support the country's car
makers by putting an extra 40% tariff on imports of Chinese vehicles.

 

Republic of Türkiye Directorate of Communications The deal was signed at an
event attended by BYD's chief executive Wang Chuanfu and President Recep
Tayyip ErdoganRepublic of Türkiye Directorate of Communications

The deal was signed at an event attended by President Recep Tayyip Erdogan
and BYD's chief executive Wang Chuanfu

In May, US President Joe Biden ramped up tariffs on Chinese-made electric
cars, solar panels, steel and other goods.

The White House said the measures, which include a 100% border tax on
electric cars from China, were a response to unfair policies and intended to
protect US jobs.

BYD, which is backed by veteran US investor Warren Buffett, is the world’s
second-largest EV company after Elon Musk's Tesla.

The company has been rapidly expanding its production facilities outside
China.

At the end of last year, BYD announced that it would build a manufacturing
plant in EU member state Hungary.

It will be the firm's first passenger car factory in Europe and is expected
to create thousands of jobs.

On Thursday, BYD opened an EV plant in Thailand - its first factory in South
East Asia.

BYD said the plant will have an annual capacity of 150,000 vehicles and is
projected to generate 10,000 jobs.

The company has also said it is planning to build a manufacturing plant in
Mexico.-BBC

 

 

 

 

'Protectionism eroding global business' - world trade chief

Global trade “is not having the best of times at the moment”.

 

That is the admission of the director general of the World Trade
Organization (WTO), Dr Ngozi Okonjo-Iweala. “We are seeing increasing
protectionism, some undermining of the WTO rules, and some of this is
leading to fragmentation,” she tells the BBC.

 

“Global trade is really part of the lifeblood for making countries resilient
- and also for underpinning growth, so we are concerned about that.”

 

In recent weeks and months these fragmentations have come to the fore with
the EU imposing provisional tariffs of up to 37.4% on imports of Chinese
electric vehicles (EVs). It followed after the US in May introduced 100%
tariffs on Chinese EVs.

Both Brussels and Washington accuse the Chinese government of unfairly
subsidising its EV sector, allowing producers to export cars at unfairly low
prices, and threatening jobs in the West.

President Biden has also increased import taxes on a range of other Chinese
products that he said formed "the industries of the future". These include
EV batteries and the minerals they contain, the cells needed to make solar
panels, and computer chips.

Meanwhile, the US has been pouring billions of dollars of government money
into green technology, through its Inflation Reduction Act, which aims to
reduce a reliance on Chinese imports.

 

EU trade commissioner Valdis Dombrovskis tells the BBC that Europe does not
want to close the market for EVs. “We welcome imports, we welcome
competition, but this competition must be fair,” he says.

Last year, the volume of global trade fell for just the third time in 30
years, according to the WTO. It says the 1.2% decline was linked to higher
inflation and interest rates, and is forecasting a recovery this year.

However those factors have their roots in events that are continuing to
fundamentally reshape the global economy, the International Monetary Fund’s
(IMF’s) first deputy managing director Gita Gopinath explained in a recent
speech.

 

“What we've seen in the last few years, I would say, especially when it
comes to global trade relations, is nothing like we've seen since the end of
the Cold War."

“The last few years, you've had numerous shocks, including the pandemic. We
had Russia's invasion of Ukraine, and following these events, increasingly,
countries around the world are guided by economic security, and national
security concerns, in determining who they trade with and who they invest
in,” she said.

That’s affecting countries as far apart as Peru, Ghana and Vietnam as they
increasingly find themselves having to choose between strengthening economic
ties with the western powers, or a China-Russia axis.

“We're also concerned about the emerging fragmentation that we see in the
trade data,” says the WTO’s Dr Okonjo-Iweala. “We're seeing that trade
between like-minded blocks is growing faster than trade across such blocks.”

 

She warns that “it will be costly for the world” to continue down this path.
WTO research has estimated that price at 5% of the global economy, whilst
the IMF has suggested it could be nearer to 7% or $7.4tn (£5.8tn) of lost
output in the long run.

A BYD electric car on display at a motor show in ChinaGetty Images

The West accuses Beijing of subsidising Chinese electric carmakers

 

The EU’s introduction of tariffs on Chinese-made EVs follows a surge in
their exports to Europe over the last few years. Exports jumped from $1.6bn
in value in 2020 to $11.5bn last year, according to one study, which said
they now made up 37% of all EV imports into the EU.

BYD, Geely and SAIC are some of the Chinese EV makers said to have
benefitted from billions of dollars worth of government help.

 

After many years of support Chinese EV companies no longer need that help,
says Jens Eskelund, president of the European Union Chamber of Commerce in
China. “They are today simply very competitive on their own terms. I think
the introduction of tariffs is a symptom that something is out of balance.”

When it comes to broader relationship, Mr Eskelund says it’s “mind boggling”
that since 2017 the volume of goods that the EU has sold to China has fallen
about a third, even though China’s economy has been growing steadily.

Citing Chinese restrictions around market access for overseas firms, and
tough security regulations, he adds: “I think it's fair to say that that
Europe still remains a significantly more open market to Chinese companies,
then the other way around. And that is obviously something that needs to
change.”

The chamber’s recent survey showed that members have the lowest confidence
on record for investing in China.

It comes as the EU is trying to lower its economic dependence on China.
European Commission President Ursula von der Leyen last year described the
need to “de-risk not de-couple” its relations with China.

Brussels' concerns include Beijing using sensitive technology for military
purposes, and its support for Russia as it continues its offensive in
Ukraine.

Companies including Ikea, Nike and Apple are also trying to become less
reliant on China.

Whilst the EU and China are set to hold talks about the potential EV
tariffs, Chinese state media has reported that retaliatory measures are
being considered on EU goods including pork, cognac and luxury cars.

 

 

Attacks by Houti rebels have forced cargo ships to avoid the Red Sea

However, there are other barriers for global trade to overcome, including in
two of the most important arteries for moving goods around the world.

This year Panama Canal officials had to reduce the number of ships allowed
to traverse the waterway. This is due to a lack of rainfall to fill the lake
that feeds the canal.

Meanwhile, the Suez Canal is effectively cut off because of ongoing attacks
on commercial ships by Houthi rebels in the Red Sea. Traffic through the
canal is down 90%, according to logistics firm Kuehne+Nagel.

Rolf Habben Jansen, chief executive of the German shipping giant
Hapag-Lloyd, says this disruption means that the rates his firm charges are
up between 30% and 40%.

Whilst shipping costs are a small part of retail prices, Mr Habben Jansen
says “these extra costs in the end get passed on” to consumers. That could
end up pushing inflation up just as central banks are showing signs of
getting it under control.

That would be “detrimental to consumers,” says the WTO’s Dr Okonjo-Iweala.

Despite all the tensions, she says trade has shown signs of resilience, and
she adds that her organization can help countries solve their differences.

Meanwhile, Dr Okonjo-Iweala admits that some WTO rules will need to change
to help meet the challenge of climate change. “I strongly believe that some
of our [global trade] rules, we do need to look at them," she says.

“When they were put in place, decades ago, we were not confronting the kind
of climate change threats we confront today.”

Regarding the increased use of tariffs, she adds: “We hope we don't have a
repeat of what we saw in the 1930s. We had retaliatory tariffs, and it was
downhill from there and everyone lost.

“So I do hope we will not enter into that kind of era again”.

-BBC

 

 

 

 

 

 

 

 

 

 


 


 


 Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2024

 


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Companies under Cautionary

 

 

 


 

 

 

 


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Econet

RTG

 


Fidelity

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