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Thursday 14th of March 2019
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Morning Africa |
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Why America cannot fly alone Trump's @Boeing reversal is a teachable moment for the America First president @FT's @EdwardGLuce International Trade |
It took about 72 hours for reality to close in on Donald Trump. One by
one, the world’s regulators — led by China, swiftly followed by the EU
— grounded Boeing’s 737 Max planes following two disastrous crashes.
Under pressure from Mr Trump, America’s Federal Aviation
Administration held out. When Canada joined, America’s isolation was
almost complete.
Mr Trump’s stance offers a unique example of the world spurning
America’s lead on airline safety. His reversal is a “teachable moment”
— to quote his predecessor, Barack Obama — on the realities of a
fast-changing world.
No black box is needed to discover why. The biggest factor is falling
global trust in US institutional probity. Mr Trump’s budget this week
proposed a cut to the FAA in spite of the fact that its air traffic
control system remains years behind many of its counterparts.
Moreover, the FAA lacks a chief. Mr Trump nominated his own pilot,
John Dunkin — the man who flew Trump planes, not Air Force One — to
head it.
When the Senate laughed him off as unqualified to lead an $18bn
agency, Mr Trump failed to come up with a new name.
The FAA has been flying without a pilot, so to speak, for more than a
year. Little surprise America’s partners have lost trust in its
direction.
Much the same could be said of US diplomacy. More than halfway through
Mr Trump’s term, one in seven US ambassadorships are still unfilled,
including South Korea, Saudi Arabia and Pakistan.
The same applies to key state department vacancies at home. Such is
the level of demoralisation that William Burns, the former deputy
secretary of state, talks of America’s “unilateral diplomatic
disarmament”.
US diplomats increasingly lack the resources — and trust — to do the
patient work of persuading other countries to fall in with America. Mr
Trump this week proposed a 23 per cent cut to the state department’s
already meagre budget.
Recent examples of America failing to co-opt a single ally include its
withdrawal from the Iran nuclear deal, pulling out of the Paris
climate change accord and asking others to fill America’s soon to be
empty shoes in Syria.
The fate of Huawei, China’s controversial telecoms company, is a
pressing case in point. Mr Trump has asked allies to follow the US
lead in banning Huawei from building their 5G networks.
Credible doubts about the absence of Chinese walls between Huawei and
Beijing’s security apparatus would have been enough a few years ago to
persuade them to follow suit.
But many, including Britain and Germany, have rejected Mr Trump’s
strictures. He has not helped his case by hinting that he would
withdraw the US extradition request for Meng Wanzhou, Huawei’s chief
operating officer, in exchange for China’s trade concessions.
In so doing, Mr Trump appears to be signalling that US courts are no
longer independent of political whim. That is the kind of offer a
Chinese leader might make.
But perhaps the most teachable aspect of the Boeing 737 controversy is
the reality of the global economy. When China and the EU agree to the
same regulatory standard, the US has little choice but to fall in
line.
Together they make up almost 40 per cent of the world’s economy.
America accounts for little over a fifth.
It was meant to be the other way round. Under the Trans-Pacific
Partnership, which previous US administrations negotiated, the US and
its allies aimed to set the global standards for China.
The now-abandoned transatlantic deal was launched with similar
ambitions. Mr Trump’s first act as president was to pull out of the
TPP. It included the kind of rules Mr Trump is now bilaterally trying
to persuade China to adopt.
By the yardstick of might, the US is still the world’s heavyweight.
But it works well only when combined with right.
US regulatory leadership on drugs approval, technology, environmental
standards and much else besides is falling behind.
In spite of the US having the world’s leading technology companies,
Europe is setting internet privacy standards.
Will Mr Trump learn from this week’s FAA experience? That is doubtful.
He broadcasts his disdain for experts almost daily.
This week he tweeted that global warming was “fake news” and that
modern airline technology was overrated.
“I don’t want Albert Einstein to be my pilot,” he said. It sounded
like he felt qualified to fly the plane himself.
As America’s president, that is his prerogative. He should not be
surprised when others deny him their airspace.
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Love of Yield Beats Supply Fears as Africa Plans Bond Deluge @business Africa |
The dollar-bond market remains unruffled by what could become a
torrent of new-bond sales from African governments: the yields are far
too attractive to worry about excess supply for now.
A measure of African sovereign dollar-bond yields eyed the biggest
two-day drop in a month even as governments from South Africa to Ghana
were testing the water for potential bond sales.
Still, the gauge hovered above its 10-year average, acting as a lure
for yield-chasing investors, given the little room for monetary
tightening in the U.S., Europe or Japan.
A “reluctant rally” that’s seen Africa outperform emerging-market
peers in the dollar-bond market may extend for a while, as investor
caution over expanding bond supply is offset by short-term momentum,
said Anders Faergemann, a senior money manager at Pinebridge
Investments in London.
''There’s no catalyst for me to suggest that the spreads will widen to
levels seen last year,” Faergemann said. “This demand for African
paper can carry on for a while because the global macro environment is
benign.”
Emerging-market borrowers have raised almost $400 billion in foreign
bonds so far in 2019, a record on a year-to-date basis, as the Federal
Reserve signaled it was in no hurry to tighten monetary policy
further, the European Central Bank boosted stimulus and expectations
grew for easing in Japan.
It has revived the hunt for higher yields in riskier emerging markets
that was the hallmark of the Fed stimulus era.
The premium investors receive to own African sovereign dollar bonds
rather than U.S. Treasuries was at 461 basis points on Monday,
according to JPMorgan Chase & Co. indexes.
African bonds have posted total returns of 8.1 percent this year,
better than any other emerging economic region, JPMorgan data shows.
That’s lowered Standard Bank’s measure of African sovereign-bond
yields to 7.39 percent from a 33-month high of 8.65 percent in
November.
South Africa
Government is considering a sale of $2 billion this month as part of a
budgeted $6 billion in external debt in the next three fiscal years
Ghana
Officials will meet investors this week in Boston, New York and London
and may choose to issue immediately if the feedback is favorable
Plans to raise $2 billion in foreign-currency debt to help finance the
budget and will take on another $1 billion if the yield it must pay is
lower than the rate for its existing liabilities
Benin
New kid on the block; West African country with GDP of $10 billion is
preparing for its first-ever sale of Eurobonds
Sale will be benchmark-sized, denominated in euros, with a maximum
maturity of eight years
Kenya
Said to plan offer of $2 billion of bonds in the first half to fund
infrastructure development and promote growth to 6.1 percent this year
Proceeds will also refinance $750 million of debt maturing in June,
and fund part of the nation’s 2018-19 budget
Angola
Plans to sell $2 billion of Eurobonds in the second quarter as part of
its public-debt plan
Ivory Coast
World’s top cocoa grower plans $1 billion bond sale even as it reviews
its financing needs against rising borrowing costs
Issue may be scheduled for May or June
African Development Bank
Eyes a 10-year euro-denominated benchmark bond;
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Don't rule out SA as a favourite emerging market @BDliveSA @RonakGopaldas Africa |
the country may be the least dirty shirt on the line.
SA’s wild gyrations between optimism and pessimism in the financial
markets are remarkable, exhausting and puzzling, all at the same time.
The week between the state of the nation address and load shedding was
another distinct example of the hyperbolic swings between Ramaphoria
and Ramaphobia, which have come to characterise the country’s
political discourse over the past year.
Notwithstanding the fact that this is an election year and emotions
are running high, there is a risk that the investment community will
get caught up in binary rhetoric rather than reality, and consequently
miss attractive opportunities. Indeed, the clouds encircling SA may
not be as dark as many think, particularly when viewed from a broader
emerging-market and global context. In fact, contrary to the
sentiments of many, there may in fact be a “bull” case to be made — at
least in the sphere of financial markets.
a more dovish Fed is good for financial assets that have come to rely
on the central bank “morphine” of cheap money.
In this context, SA does not operate in a vacuum. While South Africans
tend to be caught up in the day-to-day machinations of our own
politics and economics, the reality is that global capital market
flows move the needle. SA equities have underperformed cash and
inflation over the past five years, and in dollar terms they have gone
nowhere for seven. SA investors have capitulated.
And within the emerging-market universe, SA might just be “the least
dirty shirt on the line”. In an environment where the emerging-market
universe is seeing general slippage in governance and policy
credibility, SA seems to be bucking the trend, at least directionally.
Mexico’s populist pivot to the left has stoked market fears; Russia
remains hobbled by sanctions, poor transparency and geopolitical
controversy; and Turkey has rapidly regressed both politically and
economically amid increasing authoritarianism. India, for so long the
emerging-market darling, faces an uncertain election outcome, which
could complicate policymaking, while the credibility of its central
bank has been eroded by political interference. Meanwhile, the jury is
still out on Brazil’s reform agenda amid continued scandals and
corruption. So where then do yield-hungry investors put their money?
From an investor standpoint, when asking the proverbial “mirror,
mirror on the wall, who’s the fairest emerging market of them all?”,
the answer is not entirely clear. The mirror may be tarnished, but
SA’s fair reflection is showing glimpses of shining through.
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AliExpress.com, run by @AlibabaGroup (BABA.N), will allow Kenyan shoppers to buy goods on the site using M-Pesa in a matter of weeks @ReutersAfrica Kenyan Economy |
“As our customers get more digital, they want to shop in a more
digital kind of a format, that’s why we are seeing e-commerce
growing,” said Safaricom’s chief customer officer, Sylvia Mulinge.
Under the deal, Ant Financial, an affiliate of Alibaba that runs the
portal’s payment services, will offer M-Pesa as one of the payment
options with transactions denominated in Kenyan shillings, Safaricom
said.
“The move especially targets microtraders in the country who source
goods and other supplies from manufacturers in China,” Safaricom said
in a statement.
Safaricom, Kenya’s largest operator that is partly owned by South
Africa’s Vodacom and Britain’s Vodafone , said the deal was part of an
effort to transform M-Pesa into a global payments platform.
M-Pesa has become a major profit driver for Safaricom.
In November the company agreed a deal with Western Union to allow
M-Pesa users to send money around the world using their mobile phones.
The partnership with Ant Financial will allow M-Pesa users to shop on
AliExpress without a credit card, Mulinge said.
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@Safaricomplc share price data Kenyan Economy |
Par Value: 0.05/-
Closing Price: 26.90
Total Shares Issued: 40065428000.00
Market Capitalization: 1,077,760,013,200
EPS: 1.38
PE: 19.493
Safaricom HY results for the period ended 30th September 2018 vs. 30th
September 2017
HY Voice revenue 48.03b vs. 47.35b +1.4%
HY Mpesa Revenue 35.52b vs. 30.05b +18.2%
HY SMS Revenue 8.81b vs. 8.92b -1.2%
HY Mobile data revenue 19.45b vs. 17.55b +10.8%
HY Service revenue 118.21b vs. 109.73b +7.7%
HY Total revenue 122.84b vs. 114.43b +7.4%
HY EBITDA 62.12b vs. 54.27b +14.5%
HY EBIT 44.56b vs. 37.53b +18.7%
HY Profit before taxation 45.96b vs. 37.82b +21.5%
HY Net income 31.50b vs. 26.20b +20.2%
EPS 0.79 vs. 0.65 +20.2%
HY Free cash flow 38.50b vs. 32.40b +18.8%
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12-MAR-2019 :: Roadtrip to Garissa Kenyan Economy |
Bruce Lee the Kung Fu King said
''Life is wide, limitless. There is no border, no Frontier''
Jack Kerouac who wrote The book ''On the Road'' in which the
Protagonists, Sal Paradise, and his friend Dean Moriarty criss cross
America and Dean said
“Sal, we gotta go and never stop going 'till we get there.'
'Where we going, man?'
'I don't know but we gotta go.”
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