COMPANIES considering doing business in Cuba will find a country ripe for a modern communications system, lacking consumer goods like Coke and Pepsi, and craving more hotels, earth-moving equipment and even aluminium cans for beer.]]> |||
Matt Townsend New York
COMPANIES considering doing business in Cuba will find a country ripe for a modern communications system, lacking consumer goods like Coke and Pepsi, and craving more hotels, earth-moving equipment and even aluminium cans for beer.
That is the bounty potentially awaiting US corporations as President Barack Obama moves to thaw relations with the communist country, loosening restrictions on trade and travel. The bad news: Cuba remains a poor country with an inefficient, sometimes corrupt economy, that could dash capitalist dreams.
“The key word is potential,” said Bill Lane, director of global government affairs at Caterpillar. “Cuba doesn’t need to rebuild its infrastructure. It needs to build an infrastructure. Everything that we make in US is needed in Cuba.”
Obama’s unexpected policy shift is just a first step in allowing US companies to do business in Cuba after a 50 year- long embargo. He would let US businesses export goods such as building materials, farming equipment and communications infrastructure to the island. Ending the embargo totally would require congres- sional approval.
Easing travel restrictions could aid the cruise and airline industries. US financial institutions will be allowed to open accounts with Cuban banks. The thaw could mean new business for companies as varied as Carnival, Nike and Wal-Mart.
US consumers also were thrown a pleasurable benefit. American visitors to the island can bring back as much as $100 (R1 166) of Cuban cigars, a treasure for those so inclined. The US bans all Cuban tobacco imports now.
Normalising relations with Cuba would open a market of about 11 million people – about the same size as a US state like Ohio – that have been longing for US products for decades, according to John Kavulich, a senior policy adviser at the US-Cuba Trade and Economic Council.
Coca-Cola would consider re-entering the Cuban market “at the appropriate time and in accordance with the relevant laws and regulations governing US relations with Cuba”, Ann Moore, a spokeswoman for Coke, said. Coke sells its beverages in all countries except for Cuba and North Korea.
PepsiCo which does business in more than 200 countries and territories, looks forward “to adding the Cuba contingent on business relations becoming normalised”, said spokesman Jay Cooney.
One potentially big area for investment is telecommunications. Only about 5 percent of people in Cuba have access to the web, one of the lowest rates in the world. The new rules allow US companies to export equipment to build an internet infrastructure.
Cuba may also be ripe for automakers because many of the cars in use are decades old. “Anyone who has been to Cuba can attest that in terms of cars, time stood still,” Michelle Krebs, an analyst at researcher AutoTrader.com, said.
CARGOLUX International has been fined $941 561 (R10.97 million) for being part of a cartel with four other airlines, including South African Airways (SAA), that directly or indirectly fixed elements of the selling prices for cargo services.]]> |||
CARGOLUX International has been fined $941 561 (R10.97 million) for being part of a cartel with four other airlines, including South African Airways (SAA), that directly or indirectly fixed elements of the selling prices for cargo services.
Neo Molefe for the Competition Commission told the tribunal hearing yesterday this case concluded all the matters related to this complaint, with the commission previously entering into settlement agreements with four other airlines and withdrawing charges against two others. Molefe said Lufthansa Cargo was the leniency applicant in the case.
The tribunal in 2012 confirmed settlement agreements entered into between the Competition Commission and SAA, Air France-KLM Cargo and British Airways and in March this year with Martinair Cargo.
The commission withdrew charges against Alitalia Cargo and Singapore Airlines.
British Airways agreed to pay a penalty of £871 116.50 (R15.9m), Air France Cargo-KLM Cargo collectively a fine of e1.81 million (R26.29m) and Martinair Cargo a fine of $533 517.38 in terms of settlement agreements they reached with the commission.
SAA, in terms of the settlement agreement it reached with the commission, agreed to pay a fine of R18.79 million, but this penalty was for a “suite of complaints” initiated by the commission against SAA.
Apart from the air cargo case, the penalty agreed with SAA was also for a number of other transgressions, including fixing prices and/or trading terms related to the sale of passenger airline tickets for prime cabins on routes to and from South Africa and Far East Asia with Cathay Pacific and price fixing of passenger airline tickets for the 2010 Fifa World Cup with British Airways/Comair, 1Time Airlines, Mango Airlines, SA Express and others.
These settlement agreements followed the commission in March 2006 initiating an investigation into alleged prohibited practices in the air freight industry. It found that Cargolux had agreed and/or engaged in a concerted practice with its competitors to fix prices for fuel surcharges by engaging in discussions and exchanging and confirming information on the movement of air cargo fuel surcharges by way of telephone calls and/or e-mails with its competitors.
These discussions and exchanges occurred from February 2002 until 2006.]]>
UNLISTED steel maker Columbus Stainless has been fined R32.57 million for entering into a price fixing agreement or engaging in a concerted practice with its competitors to directly or indirectly fix the purchase price of scrap metal.]]> |||
UNLISTED steel-maker Columbus Stainless has been fined R32.57 million for entering into a price-fixing agreement or engaging in a concerted practice with its competitors to directly or indirectly fix the purchase price of scrap metal.
Columbus agreed to the fine in terms of a settlement agreement it reached with the Competition Commission, which was confirmed by the Competition Tribunal yesterday.
It is the first settlement agreement in this matter to be heard by the tribunal.
The other respondents in the case are ArcelorMittal, Cape Gate, Scaw, Highveld Steel & Vanadium, Cape Town Iron & Steel Works and the SA Iron and Steel Institute.
The commission launched an investigation into the scrap metal market after receiving an application in December 2009 for leniency under its corporate leniency programme.
It referred the matter to the tribunal in August last year after finding that from about 1998 until at least 2008 the firms had entered into an agreement to directly or indirectly fix the price of scrap metal and acted as a buyer’s cartel.
Its investigation also found these firms had collaborated and acted in tandem with the upstream cartel of scrap merchants.
These merchants were subject to a separate investigation by the commission, which previously referred cases against these merchants to the tribunal.
The commission told the tribunal yesterday the firms began co-ordinating and aligning their behaviour through meetings and correspondence.
It said the firms and the scrap merchants collectively negotiated and agreed a standard pricing formula that was used to determine the purchase price of scrap metal and on annual adjustments to this formula.
They also used the agreed adjustments to collectively renegotiate the pricing formula with merchants.
The firms and merchants also agreed on premiums that were applied by different tiers of scrap merchants when selling scrap metal, which were then structured as discounts off the formula price.
The firms annually agreed the premiums to be applied by different tiers of scrap merchants and used their agreement as a basis for renegotiating the premiums with scrap merchants.]]>
SOUTH African stocks booked their biggest daily gain since March 2009 yesterday, swept along by a wave of positive global equity market sentiment.]]> |||
Reuters and Bloomberg
SOUTH African stocks booked their biggest daily gain since March 2009 yesterday, swept along by a wave of positive global equity market sentiment.
The Top40 index ended 4.8 percent higher at 43 609, the biggest daily percentage gain since March 2009. The all share index climbed 4.25 percent to 49 290.
Sasol led the charge and was among the top gainers on the Top40 index, rising 10.55 percent to R446, boosted by a 2 percent rebound in the Brent crude. Sasol benefits from a higher oil price because it sells its synthetic fuel at the same price as firms that import and refine crude oil.
Overall, investors bought everything from insurers and retailers to mining shares after the US Federal Reserve said it would take a patient approach toward raising interest rates, boosting global stock markets.
“The Fed seems to have reminded everyone that things are not so bad, maybe this is the start of the Christmas rally that everyone has been waiting for,” said Sasha Naryshkine, fund manager at Vestact.
The Fed signalled it was likely to hold interest rates near zero at least through the first quarter, helping to reverse a sell-off in equities that pushed the all share index down by 5.3 percent this month through yesterday. The MSCI Emerging-Market index gained 1.8 percent yesterday.
Trading volumes on the JSE were 1.4 times the three-month daily average with 118 shares gaining, 38 falling and 10 unchanged.
“We’ve got our futures close-out later today which could also see volumes picking up,” Garth Mackenzie, the founder of Traderscorner.co.za, said, referring to the date when derivatives contracts expire, which happens four times a year. “There’s a lot of open interest in this close-out, so we’re going to have a very big volume day.”
The index has dropped more than 6 percent from a record high reached in July.
“We were sold down quite heavily,” Mackenzie said. ”We could probably still stage a bit more of a bounce from these levels.”
One of this year’s investor favourites, Naspers featured among the top gainers, surging 10.94 percent to R1 457.25, extending gains so far this year to about 31 percent.
Boosted by a rally in the price of gold, AngloGold Ashanti was up 8.75 percent to R100 and rival Gold Fields added 4.01 percent to R51.05.
Global stocks surged, with the Standard & Poor’s 500 index headed for its best two-day rally in nearly two years, spurred by the Federal Reserve pledge interest rates. Treasuries sank on speculation borrowing costs would rise in the middle of next year, while oil fluctuated.
The S&P 500 jumped 1.3 percent at 10.39am in New York, for a two-day gain of 3.4 percent, the most since January 2013. US stocks are rebounding from a seven-day decline that erased $1 trillion (R11.5 trillion) from equity prices and coincided with a 15 percent drop in West Texas Intermediate crude between December 5 and December 16. S&P 500 energy producers tumbled 8 percent over the stretch.
The Stoxx Europe 600 index surged 2.7 percent, as the Swiss market index rose 2.7 percent after the nation’s central bank introduced a negative deposit rate. Dubai’s benchmark gauge rose the most on record and Russia’s Micex index advanced as the MSCI all-country world index climbed 1.4 percent. Treasuries extended the biggest sell-off in three months.]]>
China wOULD lend Angola’s Sonangol $2 billion (R23.3bn) to expand oil and gas projects, the state energy company said.]]> |||
China wOULD lend Angola’s Sonangol $2 billion (R23.3bn) to expand oil and gas projects, the state energy company said, helping to cement Beijing’s influence in Africa’s second-largest oil producer. The Chinese funds will provide welcome relief for Angola, which has been hit by a nearly halving of oil prices since June, helping send its kwanza currency to an all-time low on almost a daily basis this month. Oil hit a five-year low of $58.50 a barrel this week, but bounced 2 percent yesterday as energy firms cut investments. – Reuters]]>
Barrick Gold, the world’s biggest producer of the metal, will probably take steps to stop production at its Zambian operation after the country increased mining royalties.]]> |||
Barrick Gold, the world’s biggest producer of the metal, will probably take steps to stop production at its Zambian operation after the country increased mining royalties. That process was to be announced yesterday, according to a person, who asked not to be named because the information is private. Zambia approved Finance Minister Alexander Chikwanda’s 2015 budget proposals to replace corporate income tax on mines with increased royalties. – Bloomberg]]>
President Vladimir Putin struck an uncompromising stance over the crisis gripping Russia, accusing the US and European Union of trying to undermine his country and blaming external factors for the sharp plunge in the rouble.]]> |||
Henry Meyer and Ilya Arkhipov Moscow
President Vladimir Putin struck an uncompromising stance over the crisis gripping Russia, accusing the US and EU of trying to undermine his country and blaming external factors for the sharp plunge in the rouble.
“They won’t give up because they will always try to chain” the country, Putin said during his annual press conference in Moscow, comparing Russia to a bear protecting its territory. “As soon as they chain it, they’ll rip out its teeth and claws.”
Attended by hundreds of reporters and carried live on television around the world, the event took on heightened importance this year as the president sought to reassure a Russian public unnerved by the rouble’s plummet.
Putin, vowing to guide the country through the current situation in the same way he steered Russia through the 2008 financial crisis, warned citizens to brace for a recession and criticised the central bank for not responding faster. Russia should not waste currency reserves protecting the rouble as the country prepares for a downturn brought on by the collapse of the oil price and sanctions over the Ukraine conflict, he said.
“Under the most negative external economic scenario, this situation can last two years,” Putin said. “If the situation is very bad, we will have to change our plans, cut some things.”
Putin spoke in the middle of Russia’s worst financial crisis since the 1998 default after a 16 percent slide in the rouble over two days this week. Yesterday, markets whipsawed through Putin’s press conference. The currency fell 1.2 percent to 61 roubles to the dollar, even as oil headed for its biggest gain in more than two weeks in New York.
Putin, during his wide-ranging press conference yesterday, sparred with a Ukrainian journalist, reeled off statistics on the fall harvest and spoke about guiding gifted children. He even told reporters that he has a good relationship with his ex-wife and is in love with someone new. The tone of the back-and-forth was captured in an answer about the freeing from prison of former oil tycoon and political opponent Mikhail Khodorkovsky. “I don’t regret anything. I did everything absolutely correctly.”
The country’s currency reserves have declined by a fifth to $416 billion (R4.85 trillion) over the past year as the central bank tried in vain to defend the currency, which has dropped more than 40 percent since June as oil trades near a five-year low. Russia would not force exporters to exchange revenue earned in foreign currency to prop up the rouble, he said. – Bloomberg]]>
NAMIBIA will start tapping markets and investors to finance a five-year, N$223 billion (R223bn) development plan as early as next year]]> |||
NAMIBIA will start tapping markets and investors to finance a five-year, N$223 billion (R223bn) development plan as early as next year as the country seeks to become a regional transport hub. The south-west African nation’s government has said it would finance N$73bn of the budget and find ways to raise the rest of the money for ports, railways, roads and airport upgrades. “The best way to address these funding needs is to pursue various options,” Emma Haiyambo, a spokeswoman for the Bank of Namibia, said. – Bloomberg]]>
Team bonding is the theme for Christmas parties in London’s financial district this year as managers tone down the annual knees-up and label it as staff development.]]> |||
Clare Hutchison London
Team bonding is the theme for Christmas parties in London’s financial district this year as managers tone down the annual knees-up and label it as staff development.
Fearful of a public backlash if they revived the opulent festivities of the pre-crisis era, some banks and financial firms are opting for smaller, quirkier events that can be accounted for as a learning activity rather than just a staff perk.
Treasure hunts, cocktail making, go-karting and wine tasting are some of the things companies are laying on for employees.
Before the 2008 crisis, a specially erected marquee in London’s Canary Wharf offered Christmas parties with a sit-down dinner, free-flowing champagne and a band on stilts for banks such as Lehman Brothers and HSBC.
“Every year budgets go down,” said Pascale Miller, an event executive at London-based Precipuus Events, which organises parties for city firms such as HSBC Private Bank.
“But because it’s part of team building and because it’s often a learning activity, they can mark that off in the budget as something separate from pure entertainment.”
Informal venues such as pubs are being chosen over ballrooms and the dress code is more sportswear than black tie.
“We’re seeing a lot more requests for something a little different, like ping pong (table tennis) – more team-bonding activities,” said Nick Telson, co-founder at website and events company DesignMyNight.com.
“It’s about team interactivity rather than finding a really special venue,” he added.
Some companies, however, have not turned their back on holding bigger bashes. With a performance from Diana Ross, privately-held trading company CMC Markets threw one of the season’s most talked about events, which doubled as its 25th anniversary celebration.
“Everyone here has made a massive contribution to CMC’s success – that is why this celebration is so important,” said chief executive Peter Cruddas. “Introducing Diana Ross to lead the celebrations was amazing.” – Reuters]]>
Paul Wallace and Emele Onu Lagos]]> |||
Paul Wallace and Emele Onu Lagos
NIGERIAN foreign-currency dealers halted trading after the central bank changed rules on how many dollars could be held at the end of the day to limit speculating against the plunging naira.
“Banks have to sell all dollars they buy from the market, not to keep them until the following day,” Central Bank of Nigeria deputy governor Sarah Alade said from Abuja. “It is to ensure dollar liquidity. We have noticed some dealers speculating on the currency because of the pressure from declining oil prices.”
The naira fell 13 percent against the dollar this quarter, the worst among 24 African currencies tracked by Bloomberg after Malawi’s kwacha. Investors dropped Nigerian assets as the outlook for Africa’s biggest oil producer worsened with Brent crude prices almost halving since late June.
Alade said the regulator would meet currency traders about the bank’s circular on the rules issued on its website showing that the maximum foreign-exchange net-open position was cut to zero of shareholder funds by the end of each business day from 1 percent. Interbank naira trading had ground to a halt, according to Samir Gadio, the head of African strategy at Standard Chartered.
By 11am yesterday in Lagos, there were 12 trades in the naira, according to data compiled by Bloomberg. On Wednesday, there were 101 in the same period. The currency weakened 0.2 percent to 187.45 per dollar. The circular might unnerve investors holding naira assets if they thought it would be followed by stricter measures, such as a cap on the interbank exchange rate, Gadio said.
“The circular effectively shuts down any trading activity on the interbank market,” he said. – Bloomberg]]>