Monthly Archives: December 2017

28 Dec

Oil Trades Above $59 as Libyan Output Falls After Pipeline Blast

Oil traded above $59 a barrel as crude production in Libya fell below 1 million barrels a day after a pipeline explosion Tuesday.

Futures were little changed in New York after slipping for the first time in more than a week Wednesday. While the halt at the pipeline that carries crude to Libya’s biggest export terminal will keep output below the cap it agreed to last month, it is said to need about a week for repairs.

Meanwhile, the American Petroleum Institute was said to report U.S. inventories dropped last week. Government data is also forecast to show stockpiles declined.

Oil is heading for a second yearly advance as the Organization of Petroleum Exporting Countries and its partners including Russia extended supply curbs through the end of 2018. The disruption in the North African nation lifted prices to the highest level in more than two years on Tuesday, offsetting the impact from the return of a major U.K. North Sea pipeline after a shutdown.

“Oil’s rally on the pipeline explosion in Libya may be short-lived as it’s been reported that the repair may not take too much time,” Kim Yumi, a Seoul-based market strategist at Kiwoom Securities Co., said by phone. “We will continue to see prices easing and then being elevated again because while falling stockpiles support prices, rising U.S. production will restrain any increase.”

West Texas Intermediate for February delivery was at $59.82 a barrel on the New York Mercantile Exchange, up 18 cents, at 8:37 a.m. in London. Total volume traded was about 35 percent below the 100-day average. The contract dropped 33 cents to $59.64 Wednesday.

Brent for February settlement, which expires Thursday, added 20 cents to $66.64 a barrel on the London-based ICE Futures Europe exchange after falling 0.9 percent Wednesday. The global benchmark crude traded at a premium of $6.83 to WTI. The more-active March contract was 21 cents higher at $66.20.

To read the full article, click here.

28 Dec

Hong Kong Can Save the African Whale

Naspers Ltd. isn’t so much a fish in a pond as a whale in a teacup. It accounts for almost a third of the MSCI South Africa Index, more than six times the weighting of the next biggest company.

That top-heaviness is the legacy of one of the great technology bets of all time: 16 years ago, Naspers invested $34 million in an obscure Chinese internet company called Tencent Holdings Ltd. As of Thursday, its one-third stake was worth $159 billion.

That success has lifted Naspers to a market capitalization of $114 billion. Yet it should, arguably, be worth even more. The Tencent holding alone has a value about 40 percent higher than the entirety of Cape Town-based Naspers, a business that includes Africa’s biggest pay-TV operation, classified advertising websites in Russia, and e-commerce investments around the world.

Anyone betting the discount will close may need plenty of patience: It’s persisted for almost two years and is widening. Naspers shares rose 77 percent this year in dollar terms; Tencent is up 107 percent in Hong Kong, adding 2.3 percent on Thursday after another blowout earnings report.

The limited size of the African company’s home market is at least partly to blame. While conglomerate discounts are common, domestic fund managers are likely to hold fewer shares than indicated by the benchmark index when a company reaches this level of dominance, to avoid concentration of risk. A case in point: BlackRock’s  iShares South Africa ETF underweights Naspers by 7 percentage points relative to the MSCI gauge.

Naspers could try selling some Tencent shares to narrow the discount, though the size of its stake means this probably wouldn’t be more than fiddling at the margins.

In any case, it may not want to sell. As Gadfly argued in August, owning Tencent puts Naspers in a similar position to SoftBank Group Corp. with Alibaba Group — in the box seat to gain access to other promising technology startup investments. Besides, Tencent’s stock has momentum and may push higher.

To read the full article, click here.

28 Dec

Rand Extends Comeback as Traders Anticipate Ramaphosa Presidency

It’s taken South Africa’s rand exactly nine months — and a new ruling-party leader — to claw back the losses it suffered after President Jacob Zuma unexpectedly fired Finance Minister Pravin Gordhan in March.

The rand gained as much as 1.8 percent on Wednesday to 12.2889, erasing its losses since Gordhan’s dismissal and the highest since July 2015. Gordhan’s dismissal sent the currency plunging 11 percent in two weeks and sparked a credit-rating downgrade to junk.

The rand has rallied more than 6 percent since Cyril Ramaphosa, who has pledged to revive the struggling economy and stamp out corruption, was elected leader of the African National Congress on Dec. 18. That set the billionaire businessman on a path to take over from Zuma as the country’s president. Investors are betting that may happen sooner than 2019, when his term expires, according to Legal & General Investment Management Ltd.

“The market is positively surprised by the increasing amount of support that Mr. Ramaphosa is rallying behind him,” Simon Quijano-Evans, an emerging-market strategist at Legal & General, said by email. “He is likely to continue doing so, increasing speculation about another no-confidence motion in the presidency in 2018.”

Members of the ANC’s newly elected executive committee will meet Zuma to advise him to step down in favor of Ramaphosa, Johannesburg’s City Press reported on Dec. 24, citing unidentified people. Ramaphosa beat Nkosazana Dlamini-Zuma, who was backed by the president, to the top ANC position in a closely contested vote.

Flows into South African stocks and bonds have soared since the vote. Foreigners bought a net 6.4 billion rand ($516 million) of debt and 13.4 billion rand of equities in the week ending Dec. 22, according to JSE Ltd. data.

Source: https://www.bloomberg.com/news/articles/2017-12-27/rand-extends-comeback-as-traders-warm-to-ramaphosa-presidency

27 Dec

Africa: Prince Harry Appointed African Parks President

Popular member of the United Kingdom royal family, Prince Henry of Wales also known as Prince Harry, has been appointed as new President of African Parks, the organization that manages Akagera National Park among other facilities on the continent.

The news that was announced on Wednesday, indicate that in this position, Prince Harry will be working with African Parks in various capacities to advance wildlife conservation across Africa and around the globe. The announcement was made during this morning’s BBC Radio 4 Today programme, which Prince Harry guest-edited.

African Parks is a conservation NGO, founded in 2000, that manages national parks and protected areas on behalf of governments and in collaboration with local communities across Africa. With 13 parks under management, they have the largest area under conservation for any one NGO on the African continent.
African Parks are the managers of Rwanda’s Akagera National Park, the only savanna park with the central Africa’s largest protected wetland. According to a statement Kensington Palace, on leaving the Army in 2015, Prince Harry has taken a deep personal interest in frontline conservation projects that work to protect Africa’s natural heritage and support both wildlife and local communities.
The statement says that Harry spent three months working on number of such projects in Namibia, Tanzania, South Africa and Botswana. “Prince Harry will be working with African Parks in various capacities to further our mission in managing national parks on behalf of governments, and to advance wildlife conservation across Africa and around the globe,” a statement from African Parks reads in part.
To read the full article, click here. 
27 Dec

George Weah: Who is Liberia’s new president-elect?

Former AC Milan player George Weah won the Liberian elections to become the country’s 25th president.

Arguably Liberia’s most famous citizen, the former national captain scored a resounding victory in the polls on Tuesday, getting the majority vote in 12 of the 15 counties, while his 73-year old opponent Joseph Boakai got the nod from just two of the counties.

Weah will take over the country’s highest office from Nobel Peace Prize winner Ellen Johnson Sirleaf, who became Africa’s first ever female head of state when she was elected in 2006.

Weah the footballer

The 51-year old is most famous for his work on the football pitch rather than any political office.

He started his senior football career in the late 80s, turning out for Liberian first division club Mighty Barrolle. He turned out for several clubs in his home country and Cameroon before catching the eye of French scouts, signing for Monaco in 1988 where he played for four years before being snapped up by rivals Paris Saint-Germain.

It was during his stint at Italian giants AC Milan where his star shone the brightest, winning the Ballon D’Or and FIFA World Player of the Year in 1995, becoming the first ever African player to win each award.

Weah the politician

He retired from all football in 2003 andalmost immediately pursued a career in politics, contesting the 2005 Liberian elections where he lost to Johnson-Sirleaf.

His party, Congress for Democratic Change won three seats in the Senate and Weah has since 2015 served as Senator of Liberia from Montserrado County.

That was before running for the presidency again in 2017, claiming a landslide victory over Boakai, who has served as the country’s vice president for the last 12 years.

Weah the humanitarian

As a means to promote education and get children in Liberia to stay in school, Weah founded a football club called Junior Professionals in his home country in 1994. The only requirement to be entered into the club was school attendance.

The club is now defunct but served a great purpose as many of the youngsters recruited into the club have gone on to represent Liberia in various age-group levels, including the senior national team.

Source: https://www.thesouthafrican.com/george-weah-liberian-president/ 

27 Dec

Mild Desert Winds Spell Good News for Cocoa Crop in Top Producer

A record crop in biggest producer Ivory Coast helped push the cocoa market into a surplus in the 2016-17 season. Prices tumbled and are headed for a second annual decline.

With the 2017-18 season now well underway, all eyes are on the main crop, the larger of two yearly harvests that runs from October through March. Now is a crucial time as the harvest’s at its peak. The Harmattan, dry desert winds from the Sahara, usually blow from December to February and can have a big impact on crops in Ivory Coast and neighbouring Ghana.

Regulator:

Ivory Coast’s cocoa regulator, Le Conseil du Cafe Cacao, has increased its forecast for the 2017-18 main crop harvest to 1.4 million to 1.45 million tons from a previous 1.35 million tons, a person familiar with the matter said last week.

Good rains in the past few months mean that production will probably be higher than anticipated for the second part of the main crop, starting in January, said the person, who asked not to be identified because the projection hasn’t been made public. The forecast assumes that the Harmattan remains mild and doesn’t damage cocoa pods.

Farmers:

After heavy rains in October and November, the Harmattan is now underway in most of the cocoa-growing regions. But it’s been mild so far and it’s often mixed with light rains, said Joseph Gueu, a farmer near Danane in the west of the country. That’s unusual for this time of year. Output has been good so far and young pods are growing well, he said.

Not everyone is so positive though. Too much rain has resulted in brown rot on many pods and reduced production said Alassane Sogodogo, who manages a cooperative near the Liberian border. The rain also damaged roads in the area, making it difficult to send cocoa to the port. The weather has since improved, he said.

To read the full article, click here. 

22 Dec

Mnangagwa Reveals 30km Walk Escaping G40 Assassins After Being Fired By Mugabe

PRESIDENT Emmerson Mnangagwa has revealed walking more than 30 kilometres crossing the boundary between Zimbabwe and eastern neighbour Mozambique in a dramatic escape from G40 assassins.

He was speaking in South Africa Thursday on his first foreign trip as president, after taking over power in Harare last month.

The then vice president was fired by former president Robert Mugabe from government and Zanu PF at the behest of the veteran leader’s wife Grace and her G40 allies in the ruling party.

He then escaped into exile, saying assassins were on is trail but warning he would be back in two weeks to take over power.

In Pretoria Thursday, Mnangagwa told South African business leaders and Zimbabweans based there that he had been warned his life was in danger in the aftermath of his sacking from government as Mugabe’s deputy on November 6th.

“I came here to pay homage to my brother President Jacob Zuma,” he explained. “I spent a good 16 days as a diasporan here in South Africa after walking some 30 kilometres crossing the border into Mozambique.” He added; “After I had been fired around 4 o’clock (on November 6th), intelligence had made me aware of the next move intended to eliminate me.

“Fortunately, I found a (business) card in my wallet which bore the name of a colleague here, Maphosa whom I phoned and he picked me. I came here and I was well looked after.”

An angry Mugabe fired Mnangagwa from government after his wife had been booed at a youth interface rally in Bulawayo as the bitter Zanu PF succession struggle edged towards an explosive end.

The military then entered the fray, first with a damning statement from former Commander Defence Forces General Constantino Chiwenga on November 13th before tanks moved into Harare and Mugabe was placed under house arrest.

To read the full article, click here. 

22 Dec

U.S. Sanctions Israeli Billionaire Gertler Over Congo Deals

The U.S. sanctioned Israeli billionaire Dan Gertler, one of the biggest individual mining investors in the Democratic Republic of Congo, in what it calls a clampdown on human-rights abusers and corrupt actors.

 The U.S. Treasury said Gertler has used his close relationship with the country’s president, Joseph Kabila, to amass a fortune through corrupt and opaque deals. Between 2010 and 2012 alone, Congo reportedly lost over $1.36 billion in revenues from the underpricing of mining assets that were sold to offshore companies linked to Gertler, it said.
“Gertler has used his close friendship with DRC President Joseph Kabila to act as a middleman for mining asset sales in the DRC, requiring some multinational companies to go through Gertler to do business with the Congolese state,” the U.S. Treasury said in a statement.

Under the sanctions, any assets held by Gertler within U.S. jurisdictions will be blocked and U.S. individuals are prohibited from engaging in transactions with them.

Read more: U.S. sanctions 13 in global human rights abuse crackdown

The U.S. “is taking a strong stand against human rights abuse and corruption globally by shutting these bad actors out of the U.S. financial system,” Treasury Secretary Steven Mnuchin said in the statement. “Treasury is freezing their assets and publicly denouncing the egregious acts they’ve committed, sending a message that there is a steep price to pay for their misdeeds.”

Gertler’s representatives at his office in Ramat Gan, Israel, and a public relations firm in London, said they could not immediately respond to the U.S. action. Glencore complies with all applicable sanctions, a spokesman for Glencore said by phone.

Diamond Dealer

Gertler, whose grandfather co-founded Israel’s diamond exchange 70 years ago, arrived in Congo in 1997. The then 23-year-old soon secured a monopoly on the country’s diamond sales from Laurent Kabila, the then-president and father of Congo’s current leader, whose rebellion had just overthrown the three-decade-long regime of Mobutu Sese Seko.

To read the full article, click here.

22 Dec

Why Land Seizure Is Back in News in South Africa

More than two decades after white-minority rule ended in South Africa, most of its profitable farms and estates are still owned by white people, and about 95 percent of the country’s wealth is in the hands of 10 percent of the population. The ruling African National Congress has vowed to step up wealth distribution and promised “radical economic transformation,” including constitutional changes to allow the government to expropriate land without paying for it.

1. Why is land ownership an issue?

Under the rule of European colonists, South Africa’s Natives Land Act of 1913 stripped most black people of their right to own property, a policy reinforced decades later by the National Party and its system of apartheid, or apartness.

By 2010, records of who owned what in the country were “uncoordinated, inadequate or incomplete,” according to Rural Development and Land Reform Minister Gugile Nkwinti, prompting the government to embark on a land audit that it released in 2013. Though the audit offered some insight into land ownership — it showed that 14 percent of land belonged to the state, versus 79 percent by private individuals, companies and trusts — it didn’t break this down by race.

A separate audit released Nov. 1 by Agri Development Solutions and farm lobby group AGRI SA found non-whites own 27 percent of the nation’s farmland compared with 14 percent in 1994.

2. What’s been done until now?

Since 1994, when the ANC became the nation’s dominant post-apartheid party, the state has bought 4.9 million hectares — about 4 percent of the country’s total territory — for land redistribution, with about 3.4 million hectares assigned to new owners, according to Nkwinti. Those who didn’t want the land allocated to them opted for money instead, with 11.6 billion rand ($910 million) paid out from 1994 until January.

A separate initiative known as the 50-50 program, meant to encourage joint black-white land management, uses government funds to buy half a farmer’s land and give it to laborers working there. It started in 2016.

To read the full article, click here. 

21 Dec

Ramaphosa Has Unsteady Grip on South Africa’s Ruling ANC

Cyril Ramaphosa, the newly elected leader of South Africa’s ruling African National Congress, has a tenuous hold on power in the party after his allies fell short of securing outright control over its top leadership body.

A lack of support from a clear majority of the 86 voting members of the ANC’s National Executive Committee will limit his scope to drive policy changes and assert his authority over President Jacob Zuma, whose second term as the nation’s leader ends in 2019. The NEC is the ANC’s highest decision-making body in between its five-yearly national conferences.

The faction led by the candidate he beat in the presidential race, Nkosazana Dlamini-Zuma, probably has the loyalty of about 45 of the 86 NEC’s voting members, said Xolani Dube, a political analyst at the Xubera Institute for Research and Development in the port city of Durban.

“Cyril is a very compromised president,” Dube said Thursday by phone. “He is not running the administration of the ANC. He has got a serious problem.”

Ramaphosa’s Constraints

The executive committee’s composition will constrain Ramaphosa’s ability to focus the government’s agenda on promoting economic growth, creating jobs and cracking down on corruption. His victory over Dlamini-Zuma for the presidency was by the smallest margin since the ANC came to power in 1994, and only two of the other top-five party officials elected with him are considered certain allies.

The rand weakened as much as 0.5 percent before trading little changed at 12.7142 per dollar by 11:28 a.m. in Johannesburg, bringing its gain since before the start of the ANC conference to 6.2 percent.

In his first speech as ANC president in the early hours of Thursday, Ramaphosa pledged a crack down on graft, which has become increasingly rife during Zuma’s almost nine-year administration.

“Corruption has to come to a stop and it must happen with immediate effect,” Ramaphosa said. “We must confront the reality that critical institutions of our state have been targeted by individuals and families.”

To read the full article, click here.