Major International Business Headlines Brief::: 21 March 2024
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Major International Business Headlines Brief::: 21 March 2024
<mailto:info at bulls.co.zw>
ü Africa: AfCFTA - Ethiopia to Commence Trial Trading Commodities
ü Kenya: Gachagua Hints At Govt Plans to Write Off Coffee Debts
ü Liberia: Boakai Imposes Financial Restraints On LTA
ü Nigeria: The Danger of Rising Food Inflation
ü Egypt: Why Egypt Must Pay for Tea in Dollars At Mombasa Despite Currency
Rejection
ü Kenya Considers Finance Act Review to Halt Avocado Double Taxation
ü Africa: The AfDB's $61bn Initiative Will Transform Agriculture but for
Whom?
ü Sudan Oil Fields Crippled By 'Large-Scale Sabotage'
ü Nigeria's Central Bank Clears All 'Valid' Forex Backlog, Increases
Country's Foreign Reserves
ü Nigeria: Senate Extends Implementation of 2023 Budget Till June
ü Reddit IPO: Share sale values social media firm at $6.4bn
ü Neuralink: Musk's firm says first brain-chip patient plays online chess
ü Easter eggs costs rise as climate change hits crops
ü Fed holds interest rates steady but signals cuts ahead
ü What France's crackdown on Shein and Temu means for global ultra-fast
fashion
Africa: AfCFTA - Ethiopia to Commence Trial Trading Commodities
Ethiopia is set to commence trial trading of commodities under the African
Continental Free Trade Area (AfCFTA), Ministry of Trade and Regional
Integration (MoTRI) announced.
In an interview with FBC, MoTRI Minister GebremeskelChala said that Ethiopia
has made the necessary preparations put in place the trial trading phase and
implement the framework agreement through streamlined strategies.
"Alike other African member countries, Ethiopia is currently employing
preliminary activities to commence commodities trial exchange of goods with
selected counterpart countries," he underscored.
He further mentioned that the Ministry has also projected to nullify 90%
import taxes of agricultural and industrial products within ten years.
Similarly, some 7% of goods are also approved to be nullified in the long
term and other 3% strategic items exempted from the list that is believed to
give policy space for the given nation framed as per the common framework
agreement, the Minister noted.
Thus, the country has approved 90% of commodity tariffs for 6,000goodsto the
African Free Trade Zone, he further remarked.
When this trade agreement framework is effectuated in full swing, it would
become world's leading free trade zone that realizes the African Union's
Agenda 2063 goal of becoming economically vibrant and influential continent,
it was learnt.
It is to be recalled that the leader of the African Union member states has
recently endorsed Ethiopia's tariff line poised to exchange goods within the
AfCFTA.
- Ethiopian Herald.
Kenya: Gachagua Hints At Govt Plans to Write Off Coffee Debts
Murang'a — Deputy president Rigathi Gachagua has hinted that the government
has plans to write off debts owed by coffee cooperative societies.
Speaking when he was commissioning the Murang'a coffee mill, Gachagua stated
that he will spearhead talks with the ministry of cooperatives to scrutinize
debts owed by farmers aligned to various cooperative societies.
He noted that within a period of three weeks, the exercise of vetting the
debts will be over and farmers should expect good news.
The deputy president expressed his commitment to streamline the coffee
sector saying already reforms being implemented have started to bear fruits.
He added that coffee farmers will be able to access subsidized fertilizer at
their cooperative society within a period of less than one month.
Gachagua lauded Murang'a farmers cooperative union for establishing the
coffee mill saying the facility will assist in processing and selling final
product without engaging many players.
The coffee commenced its operations after the government assisted the
facility to get a transformer last month.
The plant has the capacity to process 1. 2 tonnes of coffee per hour with
management of the union working to increase the processing capacity to more
than 5 tonnes per hour.
Cabinet secretary for cooperatives Simon Chelugui praised the installation
of the million plant saying farmers from the county will benefit more from
their produce.
Chelugui lauded Murang'a farmers for taking advantage of the cherry advance
fund saying more than 15, 000 coffee farmers have benefited from the kitty.
About The Author
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- Capital FM.
Liberia: Boakai Imposes Financial Restraints On LTA
President Joseph Nyumah Boakai has imposed financial restrictions on the
Liberia Telecommunications Authority's (LTA) outgoing chairperson, Madam
Edwina Crump Zackpah.
The restrictions, pending further notice, affect foreign travel, hiring new
staff, contractors, or consultants, and purchasing capital assets/projects
at the LTA.
Due to the executive's financial restrictions, the LTA is visibly absent
from the West Africa Telecommunications Regulators Assembly (WATRA), which
is taking place in neighboring Sierra Leone from 19 to 22 March 2024.
Liberia and Cape Verde are two countries noted to be absent so far.
Founded in 2002, WATRA is a consultative and collaborative body of
Telecommunications Regulators in West Africa that aids and advances the
development of telecommunications in the subregion and on the continent.
In 2017, LTA hosted and chaired the meeting in Monrovia. This year, Liberia
is completely absent from the meeting due to the financial clampdown on the
entity.
Former President Ellen Johnson-Sirleaf was the first head of state to attend
a WATRA meeting when Madam Angelique Weeks was chairperson of the LTA at the
time.
Meanwhile, in the communication addressed to Madam Zackpah under the
signature of Minister of State for Presidential Affairs Mr. Sylvester
Grigsby, the LTA outgoing boss is instructed to desist from any spending
outside of approved budget except allocations for daily essential operations
that are already budgeted and approved.
Dated 8 March 2024, the communication instructs Madam Zackpah to ensure
strict compliance with this mandate until further notice.
The Presidency said it issued the directive consistent with Madam Zackpah's
replacement and the ongoing Petition for a Writ of Prohibition she filed at
the Supreme Court of Liberia challenging her replacement.
"... You are hereby instructed effective immediately, to desist from any
spending outside of approved budget except allocations for daily essential
operations that are already budgeted and approved," the communication said.
"Additionally, restrictions are hereby imposed on all foreign travels,
hiring of new staffs, contractors or consultants, and purchasing of capital
assets/projects," it noted.
- New Dawn.
Nigeria: The Danger of Rising Food Inflation
In what has been adjudged the highest inflation rate in 26 years, the
Consumer Price Index (CPI) which measures the rate of change in prices of
goods and commodities, increased by 1.80 per cent to 31.70 per cent in
February compared to 29.90 per cent in the preceding month. We understand
that the CPI by the National Bureau of Statistics (NBS) is for February
which was at the height of dollar upward gyration, and high prices of goods
and services. Therefore, the figures for headline inflation and food
inflation are not surprising. Even if there had been immediate intervention,
figures for the month would still have been high. But the latest figure
should nonetheless be another wake-up call for the administration of
President Bola Tinubu. It is dangerous for prices of food to keep rising.
More worrisome is that food inflation rose to 37.92 per cent, year -on-
year, representing an increase of 13.57 per cent when compared to 24.35 per
cent in February last year. Month-on-month food inflation increased to 3.79
per cent, representing 0.58 per cent rise over 3.21 per cent in January. The
rise in the food index on an annual basis was attributable to increases in
prices of bread and cereals, potatoes, yam and other tubers, fish, oil and
fat, meat, fruit, coffee, tea, and cocoa.
To be sure, hunger has been a daunting challenge in Nigeria for years. The
United Nations World Food Programme (UNWFP) has warned repeatedly that
millions of Nigerians are at the risk of hunger as prices of foodstuff
skyrocket. The situation is compounded by the unending security challenge in
most of the areas regarded as the nation's food belt. As of December 2023, a
World Bank report showed that Nigeria's poverty level had taken a notch
higher. Recent data compiled by an international e-commerce organisation
also revealed that the average Nigerian household spends about 60 per cent
of its income on food, the highest in the world.
It is important to arrest soaring prices going forward, with immediate,
medium- and long-term measures. That Nigerians are yet to see the direction
of the administration on the issue accounts for the concerns. There have
been proposals for government to remove or slash tariffs for a brief period
on a few food items that we still import, but the approach has been to share
grains for free and go after food hoarders. We hope they see things
differently and act more swiftly.
It is noteworthy that more than a month ago, President Bola Tinubu directed
the Ministry of Agriculture and Food Security to release 42,000 metric
tonnes of maize, millet, and other grains in its strategic reserve. The
grains, according to the Minister, Abubakar Kyari, will be released to the
National Emergency Management Agency (NEMA). Today, vulnerable Nigerians are
still waiting for a fulfilment of the promise, and raises questions about
the capacity of the administration to deal with the challenge at hand.
Meanwhile, the impact of recent policy decisions has left Nigerians reeling
from soaring prices of basic foodstuffs with hunger now a common staple in
many homes.
Driving down the prices of some staple foods should be a major priority of
the government now. With angry citizens expressing their frustrations about
the daily hikes of foodstuffs, transportation costs, school fees, house rent
and other inescapable expenses that are becoming increasingly impossible to
finance, the federal government and authorities in the 36 states must wake
up to the reality of the daily struggles of a vast majority of the people.
- This Day.
Egypt: Why Egypt Must Pay for Tea in Dollars At Mombasa Despite Currency
Rejection
Egypt will continue to pay for tea at the Mombasa auction in dollars despite
its recent move away from the greenback in international trade.
All transactions at the Mombasa Tea Auction are denominated in dollars,
obliging all buyers to utilise the US currency.
An official at the auction clarified that there have been no negotiations,
nor will there be, to permit Egypt to settle its dues using an alternative
currency.
"The dollar is the sole currency accepted for trade at the auction, and
there will be no exceptions for Egypt," said the official, speaking
anonymously to Business Day Africa.
Egypt ranks as one of Kenya's top tea buyers, consistently holding the
second position in both value and quantity for many years.
In the previous year, Egypt imported tea worth Ksh22 billion, reinforcing
its status as Kenya's second-largest purchaser of the beverage.
Having recently joined BRICS, Egypt is aligning with the economic bloc's
push for de-dollarisation. This move underscores the country's determination
to reduce reliance on foreign currencies, particularly the US Dollar, as
demonstrated by its efforts to transition trade with Ethiopia and finalise
significant oil deals with the United Arab Emirates (UAE) in local
currencies.
Egypt's decision to pivot away from the US dollar aligns with its membership
in BRICS, alongside nations such as Ethiopia, Iran, Saudi Arabia, and the
United Arab Emirates which joined the bloc recently.
This shift aims to mitigate the financial impacts associated with depending
on foreign currencies for trade settlements.
The move away from the US Dollar mirrors a global trend driven by
geopolitical tensions, economic sanctions, and a desire for greater
financial autonomy.
Countries worldwide are exploring alternatives to diversify economic risks
and reduce vulnerability to currency fluctuations.
Egypt, grappling with a shortage of dollars and a weakened pound, faces
challenges including negative implications on consumer purchasing power,
contributing to inflationary pressures in a country where 60 percent of the
population lives below the poverty line.
Egypt will continue to pay for tea at the Mombasa auction in dollars despite
its recent move away from the greenback in international trade.
All transactions at the Mombasa Tea Auction are denominated in dollars,
obliging all buyers to utilise the US currency.
An official at the auction clarified that there have been no negotiations,
nor will there be, to permit Egypt to settle its dues using an alternative
currency.
"The dollar is the sole currency accepted for trade at the auction, and
there will be no exceptions for Egypt," said the official, speaking
anonymously to Business Day Africa.
Egypt ranks as one of Kenya's top tea buyers, consistently holding the
second position in both value and quantity for many years.
In the previous year, Egypt imported tea worth Ksh22 billion, reinforcing
its status as Kenya's second-largest purchaser of the beverage.
Having recently joined BRICS, Egypt is aligning with the economic bloc's
push for de-dollarisation. This move underscores the country's determination
to reduce reliance on foreign currencies, particularly the US Dollar, as
demonstrated by its efforts to transition trade with Ethiopia and finalise
significant oil deals with the United Arab Emirates (UAE) in local
currencies.
Egypt's decision to pivot away from the US dollar aligns with its membership
in BRICS, alongside nations such as Ethiopia, Iran, Saudi Arabia, and the
United Arab Emirates which joined the bloc recently.
This shift aims to mitigate the financial impacts associated with depending
on foreign currencies for trade settlements.
The move away from the US Dollar mirrors a global trend driven by
geopolitical tensions, economic sanctions, and a desire for greater
financial autonomy.
Countries worldwide are exploring alternatives to diversify economic risks
and reduce vulnerability to currency fluctuations.
Egypt, grappling with a shortage of dollars and a weakened pound, faces
challenges including negative implications on consumer purchasing power,
contributing to inflationary pressures in a country where 60 percent of the
population lives below the poverty line.
- Business Day Africa.
Kenya Considers Finance Act Review to Halt Avocado Double Taxation
The Kenyan government is considering amendments to recently implemented
financial laws to prevent double taxation on avocados in response to
mounting pressure from farmers concerned about the impact of the new duty.
Currently, Kenyan avocados face a 30 percent duty when accessing the Indian
market, this, coupled with the domestic tax, threatens to render Kenyan
produce uncompetitive in the global market.
Deputy President Rigathi Gachagua announced the government's intention to
extend tax relief to avocado farmers through amendments to Section 23 of the
Finance Act of 2023 that requires farmers to file through Electronic Tax
Invoice Management Systems (e-TIMS).
Mr Gachagua pointed out that the current finance bill unfairly disadvantages
farmers, highlighting the need for a meeting between avocado stakeholders
and the National Treasury to establish parameters for extending a tax
moratorium to farmers.
Speaking at his Official Residence in Karen, Nairobi, Mr Gachagua
underscored the significant economic potential within the avocado value
chain.
The DP called for friendly interventions to streamline the industry,
ensuring that farmers can fully benefit from their efforts.
Mr Gachagua reiterated the government's commitment to addressing farmers'
concerns in consultation with key stakeholders, aiming to maximise their
earnings from avocado farming.
Following the meeting, it was decided that an intergovernmental consultation
would convene within the week to establish parameters to address challenges
faced by avocado farmers, including tax issues.
Additionally, a committee will be formed to develop policies aimed at
regulating the avocado value chain, which generated 19 billion shillings in
2023.
The government said it is in discussion with India to exempt Kenyan avocados
from a 30 percent import levy.
Furthermore, negotiations are underway with other potential markets such as
the United Arab Emirates. Kenya's efforts come as it solidifies its position
as the 6th largest last year.
- Business Day Africa.
Africa: The AfDB's $61bn Initiative Will Transform Agriculture but for Whom?
The one-size-fits-all Dakar II plan risks sacrificing biodiversity and
smallholders for the sake of private interests. There is an alternative.
Launched early last year, the African Development Bank's ambitious Dakar II
initiative, "Feed Africa: Food Sovereignty and Resilience", seeks to usher
in a new era for African agriculture, positioning the continent as a global
breadbasket. With a staggering proposed budget of $61 billion, primarily
sourced from private and development sectors, the initiative's scale and
scope are unprecedented. However, its approach - aiming to industrialise the
continent's food systems - has ignited a fierce debate concerning its
implications for small-scale farmers, biodiversity, and the sovereignty of
African food systems.
In the aftermath of the "food and agriculture delivery compact" talks in
Dakar, the Alliance for Food Sovereignty in Africa issued a statement
titled: "Diversity, Not False Solutions, Is Key To Achieving Food
Sovereignty And Resilience In Africa". The declaration applauded the drive
to eliminate hunger and increase agricultural investment but denounced the
persistent colonial approach that neglects community rights, displaces
indigenous people, and undermines biodiversity.
At the heart of the controversy is the Dakar II initiative's tendency
towards a one-size-fits-all model of agricultural development -- a strategy
to agro-industrialise Africa. This approach is heavily reliant on corporate
hybrid seed systems, hi-tech solutions, imported inputs, GMOs, and
large-scale monocropping of maize, rice, and soybeans. As such, it overlooks
the rich diversity of needs, cultures, and ecosystems across African nations
and communities. It not only sidelines small-scale farmers - who are the
cornerstone of our continent's food security and cultural heritage - but
poses grave risks to our environmental diversity and indigenous agricultural
practices.
The Alliance for Food Sovereignty in Africa (AFSA), representing a broad
coalition of 41 member networks working across 50 countries, has now
scrutinised the 40 "country compacts" proposed under the Dakar II initiative
in a new report. Our findings reveal a worrying trend towards consolidating
land for industrial agriculture, potentially displacing millions of
smallholder farmers through land-grabbing and jeopardising their livelihoods
and food sovereignty. Furthermore, the emphasis on hybrid seeds, synthetic
fertilisers, and high-tech solutions threatens to deepen our dependency on
multinational corporations, eroding our autonomy and the traditional
knowledge systems that have sustained our biodiversity and food systems for
many generations.
In Tanzania, for instance, 1.2 million hectares of land will be "acquired"
from small scale farmers and turned into large scale block farms of wheat,
seed oils, and vegetables. The Tanzania Compact appears to be an open
invitation for the private sector to secure large-scale land grabs, saying:
"The government is keen to partner with the private sector in the land
clearing and administration, formalisation, and registration that is going
on, through provision of land surveying and cadastre mapping technologies
and services."
Meanwhile, the Kenya Compact proposes to "transform 2 million poor farmers
into surplus producers through input finance and intensive agricultural
extension support". This proposal raises concerns due to its potential to
prioritise the interests of multinational corporations over the welfare of
smallholder farmers. By promoting open trade policies and public-private
partnerships without strict safeguards, there's a risk that these
initiatives will facilitate the exploitation of local farmers and the
environment for the benefit of private investors. The absence of
restrictions on the repatriation of earnings and capital could lead to
wealth extraction from Kenya, depriving local economies of crucial
investments. Overall, such a dramatic shift shows how the compacts envision
a completely reorganised rural world for Africa.
The environmental implications of adopting an industrial agricultural model
are equally alarming. The conversion of over 25 million hectares - an area
larger than Uganda or the UK -into industrial farmland threatens to inflict
irreversible damage on our ecosystems and biodiversity. In the Democratic
Republic of Congo alone, 49,000 km2 will be transformed for industrial
production. This potential wave of large-scale land acquisitions by private
sector investors will accelerate the deforestation of the Congo Basin,
Earth's second lung, and displace millions of land users.
Such a shift towards monoculture, coupled with an increased dependency on
chemical inputs, risks degrading our soil health, contaminating our water
sources, and reducing the genetic diversity essential for our resilience
against the changing climate.
The alternative
The path forward does not need to be mired in controversy and environmental
degradation. The continent could reimagine African agriculture in a way that
is inclusive, sustainable, and resilient. By embracing agroecology - a model
that integrates local knowledge with contemporary science - Africa can forge
a path towards a decolonised agronomy that empowers small-scale farmers,
preserves biodiversity, and ensures food sovereignty.
Agroecology champions an agricultural development path that is ecologically
sound, socially just, and rooted in participatory, place-based approaches.
It is an effective alternative to the industrial model proposed by Dakar II
that prioritises the preservation of our agricultural biodiversity, the
empowerment of our communities, and the protection of smallholder farmers'
rights and livelihoods.
Our call for a shift in the African Development Bank's approach is not
merely a critique but a constructive proposal towards a sustainable future
for African agriculture. In this vision, our continent's agricultural
potential is realised not through the homogenisation of our landscapes and
practices, but through the celebration and nurturing of our diversity.
As we stand at this crossroads, the choices made today will resonate for
generations to come. It is imperative that the Dakar II initiative, and
indeed all stakeholders in African agriculture, embrace a future where
development does not come at the expense of those who have stewarded these
lands for millennia. By fostering a genuinely inclusive, participatory, and
sustainable approach to agricultural development, Africa can indeed feed
itself and the world - not through dependency and dispossession, but through
empowerment and resilience.
Million Belay is the General Coordinator of the Alliance for Food
Sovereignty in Africa (AFSA). He has been working for over two decades on
intergenerational learning of bio-cultural diversity, agriculture, the
rights of local communities to seed and food sovereignty, and forest issues.
He has a PhD in environmental learning, an MSc in tourism and conservation,
and a BSc in Biology. He is a member of the International Panel of Experts
on Sustainable Food Systems (IPES-Food).
Read the original of this report, including embedded links and
illustrations, on the African Arguments site.
Sudan Oil Fields Crippled By 'Large-Scale Sabotage'
West Kordofan — Engineers in the oil fields of West Kordofan have confirmed
"large-scale sabotage operations" in the Dafra field, near the Heglig oil
field, situated on the border between Sudan and South Sudan two weeks ago.
An engineer explained to Radio Dabanga that the Dafra field is a pumping
station for El Neem oil field, which stopped production several months ago,
due to sabotage by local gunmen. The company evacuated its employees before
the events.
The sabotage affected the fields of Dafra, El Neem, and Kanar, while the
fields of Heglig and Bamboo continue to operate despite the security
conditions, with dozens of wells out of service due to the theft of
electrical transformer oils and copper cables and the destruction of well
operating controllers, he said.
According to Sudan War Monitor, a major rupture has occurred in a pipeline
that carries crude oil from South Sudan through Sudanese territory to Port
Sudan, prompting the Sudanese oil minister to inform Chinese and Malaysian
production partners that Sudan cannot meet its obligations to deliver crude
oil through the pipeline system.
The rupture occurred due to a clog in an underground pipeline in territory
controlled by the Rapid Support Forces (RSF) in northern White Nile State,
at a village about 20 km south of the town of El Giteina, near the frontline
with the Sudan Armed Forces.
'Military operations'
Due to "military operations" in the area, pump stations operated by the
state-owned Bashayer Pipeline Company (BAPCO) ran out of diesel, causing a
"gelling incident"*--a clog, in other words--that led to a "major rupture,"
according to a letter dated March 16 by Sudan's Minister of Energy and
Petroleum, Mohieldin Naim Mohamed Said.
Most recently, Sudan's Minister of Energy and Oil, Muhyiddin Naeem Saeed,
confirmed that the reconstruction of the oil infrastructure destroyed during
the current war will cost at least $5 billion.
Saeed told the official Sudan News Agency (SUNA) that about 210,000 barrels
of crude oil has been lost a result of the sabotage of the storage facility
at the Khartoum refinery, which used to provide about 40 per cent of Sudan's
needs. The decline in oil production throughout this period, has led to the
loss of about seven million barrels of crude oil.
As reported by Radio Dabanga in December, the war has disrupted Sudan's oil
production and transportation, leading to a reliance on importing all oil
derivatives from abroad. The private sector, struggling to obtain foreign
currencies at official rates, resorts to the parallel market, escalating
costs.
In November 2023, Sudan warring parties exchanged accusations over damage to
El Jeili oil refinery. The Rapid Support Forces (RSF) accused the Sudanese
Air Force of bombing El Jeili oil refinery north of Khartoum, however the
Sudanese Armed Forces (SAF) contradicted the statement and said that fire
broke out after an RSF fuel tanker exploded at the refinery.
Last year, Radio Dabanga reported that armed men launched rocket and grenade
attacks on the field, as well as intimidating workers with leaflets reading
"leave with your family before you perish."
*Sudan produces mostly Nile blend, a paraffiniccrude oil, and also the less
valuable Dar blend. These crude oils, differ in density, specific gravity,
viscosity and pour point, and chemical content.
- Dabanga.
Nigeria's Central Bank Clears All 'Valid' Forex Backlog, Increases Country's
Foreign Reserves
The Central Bank of Nigeria (CBN) on Wednesday announced it has cleared all
'valid' foreign exchange backlogs.
This move, announced by the bank's Acting Director of Corporate
Communications, Hakama Sidi-Ali, comes as a decisive step towards restoring
confidence in Nigeria's economy.
According to her, the CBN recently completed the payment of $1.5 billion,
effectively settling the remaining balance of the FX backlog owed to bank
customers.
She said the process underwent meticulous scrutiny by independent auditors
from Deloitte Consulting, ensuring that only legitimate claims were honored.
Any questionable transactions were promptly referred for further
investigation, she said.
"We made clearing the FX backlog a priority to restore credibility and
confidence in the Nigerian economy.
"It was important that we go through an independent and credible process
that would determine the authenticity of those obligations, and, at this
point, I can tell you that we have now cleared all genuine, verifiable
transactions. This encumbrance to market confidence in the country's ability
to meet its obligations is now totally behind us," the statement quoted the
CBN Governor Olayemi Cardoso as saying in a recent meeting.
She said the clearance of the backlog of foreign exchange transactions is a
component of the comprehensive strategy outlined in the previous Monetary
Policy Committee meeting held last month.
This strategy, she said, aims to stabilize the exchange rate, which in turn
helps to mitigate imported inflation and boost confidence in both the
banking system and the overall economy.
Mr Cardoso utilised the MPC meeting and a subsequent conference call with
foreign portfolio investors to establish expectations of ongoing growth in
Nigeria's foreign currency reserves and enhanced liquidity within the
foreign exchange market.
The CBN also disclosed an increase in the country's external reserves,
noting that as of 7 March, the reserves reached $34.11 billion, the highest
level in eight months.
It said the rise was primarily driven by an uptick in remittance payments
from Nigerians abroad and heightened purchases of local assets by foreign
investors.
Background
The CBN Governor Olayemi Cardoso had earlier disclosed that the bank
uncovered invalid foreign overdue claims totaling $2.4 billion, which
pressured the naira for a long time and spooked the currency market.
Deloitte was hired by the CBN to investigate the claims, revealing $2.4
billion of the backlog as false claims due to missing import documents in
some cases.
"We had had reasons to believe we needed to take a harder look at these
obligations. So we contracted Deloitte management consultants to do
forensics of all these obligations and to actually tell us what was valid
and what was not," Mr Cardoso said.
"The result that came out of this was startling in a great respect. It was
startling. We discovered that of the roughly $7 billion, about $2.4 billion
had issues, which we believe had no business being there and the infractions
on that ranged from so many things, for example not having valid import
documents and in some cases, entities that do not exist.
"There were account parties who had asked for foreign exchange and got more
than they asked for. There were some who didn't even ask for any and got. So
there were whole loads of infractions there."
- Premium Times.
Nigeria: Senate Extends Implementation of 2023 Budget Till June
The extension of the 2023 budget and the 2023 supplementary budget followed
a request by President Bola Tinubu.
The Senate on Wednesday extended the implementation of the capital component
of the 2023 budget till June.
It also extended the implementation of the N2.17 trillion 2023 supplementary
budget till June.
The Deputy Senate President, Barau Jibrin, who presided over the session,
announced the extension of the Appropriation Acts during the plenary after
the bills seeking the extension were read for the second and third time and
supported by a majority of the senators.
The appropriation bills were separately considered at the Senate Committee
of Supply.
The lawmakers did not debate the extension of the implementation
Appropriation Acts before the deputy senate president hurriedly put the
passage to vote.
The Senate Leader, Opeyemi Bamidele, raised a motion to lead a debate on the
bill seeking the extension of the Appropriation Acts but the deputy senate
president objected on the ground that the lawmakers were already familiar
with them.
"The leader, this matter has been debated severally, we are all aware of it,
is there anyone that is not aware of it? It is just the extension of the
2023 appropriation bill, the capital side to the end of June this year and
the re-enactment of the supplementary to start from the beginning of January
to the end of June," Mr Jibrin said.
The extension of the two Acts was a sequel to the requests by President Bola
Tinubu.
The Senate President, Godswill Akpabio, had earlier read a letter from the
president, requesting the extension of implementation of the two Acts.
Mr Tinubu, in the letter, said the extension was necessary to ensure that
the provisions of the two Acts were fully implemented.
After the passage of the bill, the deputy senate president expressed
appreciation to the lawmakers for supporting it.
Mr Jibrin, thereafter, urged Ministers Departments and Agencies (MDAs) of
the federal government and contractors to complete ongoing projects across
the country.
"The request came from the president today. It is quite necessary to get
this passed so that the capital component of the 2023 Appropriations Act can
be fully implemented.
"If we don't do this, we will create room for abandoned projects. We
therefore urged the MDAs and contractors to fast track all the projects that
are under implementation across the country" the deputy senate president
added.
- Premium Times.
Reddit IPO: Share sale values social media firm at $6.4bn
Reddit has priced its shares at the top of a marketed range, valuing the
social media platform at $6.4bn (£5bn).
It has raised $748m as it sells 22 million shares for $34 each, making it
one of the biggest initial public offerings (IPO) by a social media firm.
The shares will start trading on the New York stock exchange on Thursday.
In an unusual move the company offered some of the shares to the platform's
users, although it has not been disclosed how many took up the offer.
Reddit was founded almost 20 years ago and has become one of the most
popular websites in the world.
It is an online forum where users can discuss topics that interest them. As
of the end of December 2023 it had more than 73 million users, according to
the company.
But the filing brings to the forefront a question that has been bubbling for
years behind the scenes - how can a business make money from what is,
essentially, random conversations.
People do not pay to use Reddit - the website is completely free for people
to browse, post and comment.
For 20 years it couldn't turn a profit, and some might ask why Reddit is
worth billions if it has not ever made money.
It has tried a few things, and a significant visual change in 2017 made the
website more friendly to advertisers.
But it seems Reddit's road to profitability has an end in sight, built
around AI models.
That is because companies like OpenAI, the developer of ChatGPT, will pay
for data of those random conversations.
Google is believed to have paid Reddit $60m for the right to scan almost two
decades of discussions to make its AI more human-like - and Reddit has said
it has agreed licensing deals worth more than $200m over the next two to
three years.
In February, Reddit said it lost $90.8m in 2023, so the money from
artificial intelligence (AI) firms could make the platform profitable.
Inquiries and accusations
But there are also plenty of concerns on Reddit's horizon too.
For one thing, the social media platform is facing increased scrutiny from
regulators.
The US Federal Trade Commission (FTC) is already looking into how Reddit
licences its data for AI models - generally speaking, regulators don't like
it when big technology firms sell data generated by users.
While the platform may have seen that coming, it may have been blindsided by
a challenge from mobile phone firm Nokia, which is accusing it of infringing
on its patents.
"We will evaluate their claims," Reddit said, adding that it's faced similar
accusations in the past.
Perhaps most significant of all is that Reddit's filing with the US
financial markets regulator, the Securities and Exchange Commission (SEC),
notes its users as a potential risk that comes with owning shares in the
company.
"If we fail to increase or retain our user base or if user engagement
declines, our business... and prospects will be harmed," it said in the
filing.
"If Redditors do not continue to contribute content or their contributions
are not valuable or appealing to other Redditors, we may experience a
decline in the number of Redditors accessing our products and services...
which could result in the loss of advertisers."
Reddit's user base has been known to react with frustration to changes made
on the platform.
Such is their distaste for changes made in recent years, a search on the
platform for chief executive Steve Huffman - username u/spez - shows that
when Redditors mention him the comments are usually preceded by foul
language.
Despite growing discontent, threats to leave the platform - such as the
blackout that rendered much of Reddit unusable in 2023 - have often proved
short-lived.-BBC
Neuralink: Musk's firm says first brain-chip patient plays online chess
Elon Musk's brain-chip company Neuralink has shown its first patient moving
a cursor on a computer using an implanted device.
In a nine-minute livestream on X, formerly Twitter, Noland Arbaugh uses the
cursor to play chess online.
Mr Arbaugh was paralysed below the shoulders after a diving accident and
received the chip implant in January.
The company's goal is to connect human brains to computers to help tackle
complex neurological conditions.
"The surgery was super easy," Mr Arbaugh said during the presentation.
Mr Arbaugh also said that he had used the brain implant to play the video
game Civilization VI. Neuralink gave him "the ability to do that again and
played for eight hours straight", he said.
However, Mr Arbaugh said the new technology was not perfect and they "have
run into some issues".
Neuralink's device, which is about the size of a one pound coin, is inserted
into the skull, with microscopic wires which can read neuron activity and
beam back a wireless signal to a receiving unit.
The company has also run trials in pigs and claimed that monkeys can play a
basic version of the video game Pong.
Neuralink was given permission to test the chip on humans by the Food and
Drug Administration (FDA) in May 2023.
Neuralink is one of a growing number of companies and university departments
attempting to refine and ultimately commercialise this technology.
For example, the École Polytechnique Fédérale in Lausanne in Switzerland has
successfully enabled Gert-Jan Oskam, who is paralysed, to walk just by
thinking about the movements involved.
That was achieved by putting electronic implants on Mr Oskam's brain and
spine, which wirelessly communicate thoughts to his legs and feet.
Details of the breakthrough were published in the peer-reviewed journal
Nature last year.
The human brain is home to around 86 billion neurons, nerve cells connected
to one another by synapses.
Every time we want to move, feel or think, a tiny electrical impulse is
generated and sent incredibly quickly from one neuron to another.
Scientists have developed devices which can detect some of those signals -
either using a non-invasive cap placed on the head or wires implanted into
the brain itself.
The technology - known as a brain-computer interface (BCI) - is where many
millions of dollars of research funding appears to be heading at the
moment.-BBC
Easter eggs costs rise as climate change hits crops
Climate change is a key reason your chocolate Easter egg could cost more
this year, according to researchers.
Most chocolate is made from cocoa grown in West Africa, but a humid heatwave
has blasted the crops and massively cut yields.
Experts say that human-induced climate change has made the extreme heat 10
times more likely.
Which? found some popular eggs have risen in price by 50% or more.
The shortage of cocoa resulting from the heatwave has seen prices soar to
almost $8,500 (£6,700) a tonne this week.
Cocoa trees are particularly vulnerable to changes in the climate. They only
grow in a narrow band of about 20 degrees latitude around the Equator.
Most global production is concentrated in West Africa. In 2023, 58m
kilogrammes of cocoa beans worth £127m were imported to the UK from Ivory
Coast and Ghana with 85% of the UK's cocoa beans sourced from Ivory Coast.
However, severe drought conditions have hit the West Africa region since
February this year.
This has been caused by temperatures that soared above 40C, breaking records
in countries including the Ivory Coast and Ghana.
It was these exceptionally high temperatures that the World Weather
Attribution group, based at Imperial College London, found were made 10
times more likely by human-caused greenhouse gas emissions.
Their study found that unless the world quickly reduces fossil fuel use,
West Africa will experience similar heatwaves about every two years.
"There were reports from farmers in Ivory Coast that the heat weakened the
cocoa crop," according to one of the authors of the study, Izadine Pinto,
from the University of Cape Town.
He said the high temperatures increased the rate of evaporation, leaving the
crops without sufficient moisture.
Another factor impacting the crops was El Niño.
This is a recurring, natural fluctuation in weather patterns in the tropical
Pacific that drives up global temperatures and can lead to extreme weather
in some places. A strong El Niño has been active since last June.
El Niño years often present challenges for farmers, but global warming is
exacerbating those changes, says Ben Clarke, an expert on extreme weather at
the Grantham Institute at Imperial College.
"Increasingly, climate change driven by fossil fuel use is multiplying this
natural challenge in many regions. It fuels more extreme conditions,
devastates harvests, and makes food costs higher for all," Mr Clarke said.
Drought is not the only factor affecting cocoa growers. Both Ivory Coast and
Ghana have been hit with an extreme weather double whammy.
In December last year, both countries experienced intense rains. Total
precipitation in West Africa was more than double the 30-year average for
the time of year.
The wet and humid conditions allowed a fungal infection called black pod
disease to flourish, rotting cocoa beans on the trees.
The result of these different extreme events has been the same - the price
of cocoa has more than trebled since this time last year and doubled in just
the last three months.
Chocolate makers typically buy beans months ahead of time but soaring prices
are now beginning to affect prices in the shops.
"Lots of players who have already announced price increases. We are also
part of that group," Martin Hug, of chocolate maker Lindt & Spruengli told
city analysts earlier this month.
In February, Mondelez, the company that owns the Cadbury brand, and the
American chocolate maker Hershey were already warning rising cocoa prices
could drive up the price of chocolate.
Feeling the brunt of these price fluctuations are the farmers who grow the
cocoa crops.
There are estimated to be some two million smallholder farmers in the West
African cocoa belt who rely on this labour-intensive crop for most of their
income.
Amber Sawyer, an analyst at the climate think-tank the Energy and Climate
Intelligence Unit, said wealthy countries like the UK can provide financial
and technical support to developing countries to help their farmers better
cope with extreme weather.
But she warned that, "as climate change worsens, more support will
undoubtedly be needed to protect their livelihoods and keep the flow of
cocoa beans coming into the UK."-BBC
Fed holds interest rates steady but signals cuts ahead
The US central bank has left its key interest rate unchanged again, while it
looks for more evidence that inflation is coming under control.
The decision kept the target range for the Federal Reserve's influential
rate in the range of 5.25%-5.5%, the highest in more than two decades.
The Fed is debating whether higher borrowing costs have done enough to ease
the pressures pushing up prices.
Officials said they still expected to cut rates by the end of the year.
But after raising borrowing costs aggressively in response to soaring prices
in 2022, the bank is proceeding cautiously.
"We want to be careful and fortunately with the economy growing, the labour
market strong and inflation coming down, we can" be, Fed chairman Jerome
Powell said at a press conference after the Fed's meeting.
The Fed's move comes a day before the Bank of England will announce its own
interest rate decision. It is also expected to hold UK interest rates where
they are, at 5.25%, a 15-year high.
Higher interest rates in theory work to cool inflation by make borrowing
more expensive, slowing the economy and easing the pressures pushing up
prices.
But if left in place for too long, they risk triggering a harsh economic
slowdown.
The moves in the US are being closely watched, as countries around the world
face similar trade-offs.
For now, the world's largest economy has held up surprisingly well, despite
the higher interest rates.
Forecasts released after the meeting showed that officials expect the
economy to grow 2.1% this year, a significantly more rosy outlook than the
1.4% they projected in December.
The forecasts also showed officials expect inflation to fall to 2.4% by the
end of the year, approaching the 2% rate the bank wants to see.
Mr Powell said officials were not overly concerned by some recent data,
which has suggested that progress might be stalling.
The inflation rate was 3.2% in the US last month and 3.1% in January.
"We're not going to overreact to these two months of data, nor are we going
to ignore them," he said.
The forecasts showed higher rates next year than officials had previously
forecast. But overall the outlook suggested that the bank's confidence that
it can rein in inflation without knocking the economy off course is growing.
Charles Mangin, head of foreign exchange at UK-based Crown Agents Bank,
which specialises in emerging markets, said the growth in the US was "quite
impressive".
But he warned that if strong growth leads the US to keep interest rates
higher for longer than expected, it could lead to economic pain in other
countries.
Emerging markets have seen foreign investment slow sharply, as investors
shift money to more established economies like the US in response to higher
rates.
Central banks in countries such as Egypt and Nigeria have already raised
their own interest rates aggressively to try to compete, a path others may
have to follow if they hope to bring investors back, he said.
But those moves - which sent rates to more than 20% in Egypt and Nigeria-
will not come without local costs, he warned.
"The premium [to which] these guys will have to push their rates ... will
put stress on the economies," he said. "If now we're in the scenario where
the US are going to keep rates higher for longer, it's going to be a
challenge for quite a few of the emerging markets countries."-BBC
What France's crackdown on Shein and Temu means for global ultra-fast
fashion
France's fast fashion bill takes aim at retail behemoths lawmakers argue
damage the environment, hurt the economy and feed impulse buyers.
France's lower house of parliament unanimously approved a "kill bill" on 14
March that targets fast fashion and ultra-fast fashion sold by online retail
giants such as Shein and Temu. The measure is a move to offset the fast
fashion industry's environmental impact by banning the advertising of
certain ultra-fast-fashion companies – and penalising them with annually
increasing increments of up to 10 euros (£8.54 or $10.92) per article of
clothing by 2030. The bill would also mandate that fast fashion retailers
include an item's reuse, repair, recycling and environmental impact near the
product's price.
What is fast fashion?
Fast fashion is widely considered low-quality apparel. It is produced
rapidly to follow current trends in the industry and sold at rock-bottom
prices. Fast fashion allows cost-conscious consumers to regularly update and
expand their wardrobes with knockoff en vogue styles, and although the
monetary cost is low, experts say both textile factory workers and the
earth's environment are paying the – hefty – price.
"It's important when the price conversation comes up for people to realize
that the price of fast fashion is being kept artificially low," said Emily
Stochl, the vice president of advocacy and community engagement at Remake, a
sustainable fashion nonprofit organisation.
"It's essentially being subsidized by the fact that these companies are not
paying their workers adequately. So this idea that [fast fashion pricing] is
the bar for clothing that consumers have come to expect – it's an artificial
construction."
Stochl points to previous advertising bans such as cigarette advertisements
in the US in the 1970s and the UK in the early aughts, likening the
addictive nature of tobacco to the impact fast fashion has had on consumers.
France's new bill uses similar language, stating, "This evolution of the
apparel sector towards ephemeral fashion, combining increased volumes and
low prices, is influencing consumer buying habits by creating buying
impulses and a constant need for renewal, which is not without
environmental, social and economic consequences."
Shein, Temu and the impact of new policies
Shein, a fast fashion behemoth founded in China and headquartered in
Singapore, argued in a statement to the BBC that the bill's impact will
"worsen the purchasing power of French consumers, at a time when they are
already feeling the impact of the cost-of-living crisis."
Kathleen Talbot, chief sustainability officer and vice president of
operations at Reformation, an eco-friendly brand favored by the likes of
Taylor Swift, Monica Lewinsky and Sydney Sweeney, says that ultra-fast
fashion brands represent the "insane excess" the fashion industry is seeing
in terms of speed and volume. Talbot adds that using regulation as a vehicle
to drive change may be the only option, as slowing overconsumption seems
unlikely in a market with a piping-hot demand that isn't simmering down.
How do we start to create incentives for good actors – or on the flip side,
tax bad actors – to force brands to pay for negative externalities –
Kathleen Talbot
"What's interesting about the proposed French bill and regulations like the
New York Fashion Act is they do have similar aims," says Talbot. "We're
asking these big questions around how we account for the negative impacts of
fashion on people and the planet. How do we start to create incentives for
good actors – or on the flip side, tax bad actors – to force brands to pay
for negative externalities? I wish it was easier to do that. What we're
seeing are these really location-specific, siloed efforts."
"But I think it's a start", Talbot adds. "Hopefully, [it] helps become a
model or move other regulatory bodies to consider these issues and consider
what the role of regulation is in addressing the challenges we're seeing in
the industry."
When approaching lasting change through policy reform, Stochl points out
that vital workers in the garment-maker and textile waste management
communities are most harshly impacted by fast fashion – and they are
centered in the development of the proposed legislation.
"Lawmakers should ensure that the funds collected via these penalties flow
in the direction of where that environmental impact is occurring," Stochl
continued. "For example, the frontline communities facing the most
environmental impact because of fast fashion are often communities in the
global south
So as penalties are collected to address environmental impact,
how are those funds distributed to the frontline communities most impacted?
As far as I can tell, the policy doesn't address those things."
Temu, a Chinese-owned e-commerce company, has been widely criticised by
politicians in the UK and US alike – and in 2023, a US government
investigation warned of an "extremely high risk that Temu's supply chains
are contaminated with forced labor."
Temu says it "strictly prohibits" the use of forced, penal, or child labour
by any of its merchants.
In 2021, a report by Swiss advocacy group Public Eye, found that a number of
Shein employees across six sites in Guangzhou were found to be working
75-hour weeks. And in 2023, a group of US lawmakers called for Shein to be
investigated over claims that forced labour of the Uyghur people – a Turkic
ethnic group within China – is used to manufacture some of the clothes the
brand sells. Shein told the BBC that it has "zero tolerance" for forced
labour.-BBC
BC
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