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Foreign tourist numbers up 23 percent in Tunisia in 2017

27 December 2017 Comments (0) Actualites

TUNIS (Reuters) – The number of foreign tourists in Tunisia rose by 23 percent in 2017 compared with the previous year, official data showed, indicating that a vital industry crippled two years ago by Islamist attacks is recovering.

Tourism accounts for about 8 percent of Tunisia’s gross domestic product, provides thousands of jobs and is a key source of foreign currency, but has struggled since two deadly militant attacks in 2015.

A total of 6.731 million tourists visited the North African country in the year until Dec. 20, data provided by the presidency showed.

The number of European tourists rose by 19.5 percent to 1.664 million, the data showed. The number of French visitors rose by 45.5 percent and the number of Germans by 40.8 percent in the same period.

The number of Algerians visiting rose by 40.5 percent to 2.322 million.

Tunisia’s tourism revenues rose by 16.3 percent to 2.69 billion dinars ($1.09 billion), data showed.

In 2010 Tunisia’s tourism revenues had hit a record at 3.5 billion dinars with almost 7 million tourists visiting.

The rise is helping the government weather an economic crisis as it plans to raise taxes from 2018, part of reforms agreed with the International Monetary Fund in return for a loan package.

High unemployment has driven youth to seek illegal migration to Europe.

($1 = 2.4758 Tunisian dinars)

 

(Reporting by Mohamed Argoubi; Writing by Ulf Laessing; Editing by Louise Heavens)

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More work needed before Congo Republic bailout -IMF

21 December 2017 Comments (0) Actualites, Africa, Economy

ABIDJAN (Reuters) – The International Monetary Fund (IMF) ended a week of talks in Congo Republic on Thursday saying the debt-crippled nation had more work to do if it hoped to gain the lender’s approval for a bailout package.

Like other Central African oil producers, Congo has been hit hard by low crude prices. Government revenues have dropped by a third since 2015. The IMF said in its end-of-mission statement that the non-oil economy was in recession, with a contraction of 9.2 percent expected for this year.

The Fund said it was encouraged by Congo’s draft 2018 budget and added that progress had been made in formulating medium-term macroeconomic and structural policies it could support.

However, it said the government needed to do more to restore debt sustainability, urging it to finalise the hiring of legal and financial advisors. More progress towards strengthening governance was also needed.

Congo is regularly singled out by anti-corruption groups for the opaque management of its oil sector.

The finance ministry acknowledged that “immediate measures” were needed.

“That is why… Congo Republic will open negotiations with its main creditors in the aim of restructuring its debt,” it said in a statement.

Once the Fund’s recommendations were carried out, “a financial arrangement to support Congo’s economic programme would be discussed at staff level before being proposed for the IMF Executive Board’s consideration,” said Abdoul Aziz Wane, who headed the mission.

The slow pace of the negotiations with the IMF, which have been under way for months, as well as continuing legal uncertainties, have compounded Congo’s acute liquidity pressures, according to Fitch.

Unsustainable debt meanwhile had led to high default risks for private creditors, the ratings agency said. ​

The IMF said in October that the country’s public or publicly guaranteed debt totalled $9.14 billion, or around 110 percent of GDP, by the end of July.

Much of that debt is believed to be owed to oil traders, who lent money to the government against future crude shipments.

A construction firm has also filed suit in a French court seeking payment of over $1 billion for public works projects dating back decades. That debt was not included in the IMF’s estimate.

Negotiations to hammer out the terms of an IMF assistance package will continue early next year, the finance ministry said in its statement.

 

 

(By Joe Bavier. Additional reporting by Aaron Ross; Editing by Alison Williams and John Stonestreet)

 

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Investors fear South African market euphoria is overdone

20 December 2017 Comments (0) Actualites, Africa, Economy

LONDON (Reuters) – Businessman Cyril Ramaphosa, the new leader of South Africa’s ruling ANC party, needs to fix a sluggish economy and a deeply divided society. Market euphoria after his election may not reflect the looming slog, fund managers say.

The outcome, announced late on Monday, was widely expected. The rand has rallied 7 percent against the dollar since Thursday, and government bond yields fell 58 basis points over the same period. Credit default swaps, used to price default risks, are down around 16 bps since end-Thursday.

On Tuesday, shares in South African banks – a barometer of economic and political health – jumped 8 percent.

Ramaphosa, likely to become South Africa’s president after the 2019 elections, is considered an improvement on scandal-mired Jacob Zuma. But the good news seems already in the price – a CDS-based model by S&P Capital shows South African foreign debt priced in line with its rating for the first time in 2 1/2 years following the ratings cut in late November.

The country’s domestic bonds have long traded as if its credit rating were a notch lower, the model shows, with yields well above similarly rated countries such as Indonesia.

Many even reckon the market reaction is overdone. JPMorgan analysts see the rand now as 9 to 11 percent “rich”, based on recent moves in other emerging currencies as well as weaker prices for gold and platinum, major South African exports.

“If you look at local (bond) markets, I’d say the market relief was probably not justified by fundamentals. The structural weakness is very entrenched and won’t go away easily,” said Anders Faergemann, senior portfolio manager at PineBridge Investments.

He was citing sub-one percent growth, stubborn inflation, a 28 percent jobless rate, rising government spending and capital shortfalls at state-run companies. Those problems could be tough to fix in 2018, when Zuma will still be president.

“That could lead to policy paralysis, and that is the real risk,” Faergemann said.

The news has not altered the view on South Africa at AXA Investment Managers, where Sailesh Lad, the head of emerging debt, retains an underweight position.

Ramaphosa is not a “game-changer”, Lad said, noting the budget deficit blowout, announced in October by finance minister Malusi Gigaba, remained in place. Gigaba’s budget pencilled in a big increase in borrowing and a deficit increase to 4.3 percent of gross domestic product.

The higher spending had appeared to confirm that the rating on South African local bonds would be cut to “junk” territory by Moody’s and S&P Global, ejecting the debt from key indexes and triggering capital outflows of over $10 billion.

However, Moody’s held off the downgrade last month and Ramaphosa-linked market gains partly reflect hopes it may not do so at its early-2018 review.

If the new ANC leader does implement promised reforms, some hope the country could eventually regain investment grade, as Portugal has just done and Ireland did in 2014.

But most predicted South Africa will be harder to fix, given Ramaphosa’s narrow victory margin, racial divides and entrenched corruption, with his ascent merely having delayed the inevitable to later in 2018.

Political risk consultancy Eurasia reckons, in fact, that with elections looming, the ANC may lurch further to the left, and will not therefore “provide sufficient grounds to reverse ratings downgrades before mid-2018.”

 

(By Karin Strohecker and Claire Milhench. Additional reporting by Marc Jones, Sujata Rao and Ritvik Carvalho, writing by Sujata Rao, editing by Larry King)

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Drought to hit South Africa’s 2018 wine harvest

19 December 2017 Comments (0) Actualites, Africa, Agriculture

JOHANNESBURG (Reuters) – South Africa, the world’s seventh biggest wine producer, is expected to see the smallest harvest in more than a decade in 2018 after drought and lower plantings hit yields, industry experts said.

The winelands are mostly in the coastal Western Cape province which was declared a disaster area in May due to a severe drought that has dried up dams and led to water restrictions for residents and industry.

The 2018 harvest is expected to be much smaller than the estimated 1,434,328 tonnes produced in the 2017 crop, based on a survey conducted in the last week of November by industry body South African Wine Industry Information and Systems (Sawis).

Sawis, which will give its final crop estimate in August, did not give a figure for 2018 but said it would likely be less than in 2017.

“If in certain areas we don’t get rain it could end up smaller,” Sawis Chief Executive Officer Yvette van der Merwe told Reuters.

VinPro, an industry body, expects the 2018 crop to be the smallest since 2005, when 1,157,631 tonnes were harvested due to drought and diseases in some production areas.

“This means that wine grape producers’ water resources were cut by 40 percent to 60 percent and they could not fully meet their vines’ water demand,” Vinpro consultation service manager for the wine industry, Francois Viljoen, said in a statement.

South Africa which produces 3.9 percent of the world’s wine, harvests its winelands between February and March.

Western Cape dams were only 34.6 percent full last week compared with 50.4 percent in the same period last year, according to local government statistics that show a steady annual falls from 2014 when they were 90 percent full.

White and black frost damage in the Breedekloof, Robertson and Worcester regions could also hurt the 2018 harvest. Paul MakubeSenior, agricultural economist for FNB Business, estimated harvests would be 10,000 to 15,000 tonnes lower in those areas.

South Africa’s wine industry, which exports 440 million litres of wine a year and sells 400 million litres locally, could see higher prices if the crop is significantly decreased.

“If you have a lower crop the prices are going to be higher and it will eventually be passed on to the consumers,” said Makube, saying any price rise would depend on the harvest size.

Global wine production in 2017 is also set to fall to 246.7 million hectolitres – its lowest since 1961 – further supporting prices, after harsh weather in western Europe damaged vineyards, the Paris-based International Organisation of Vine and Wine (OIV) said in its estimates in October.

 

(By Tanisha Heiberg. Editing by James Macharia and Edmund Blair)

 

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Morocco should step up structural reforms – IMF

15 December 2017 Comments (0) Actualites, Africa

RABAT (Reuters) – Morocco needs to step up structural economic reforms and maintain “sound” fiscal and monetary policies, the International Monetary Fund (IMF) said on Thursday.

Morocco, the region’s biggest energy importer, has been working with a technical mission from the IMF on liberalising its currency regime after a drop in global oil prices helped strengthen its finances.

“Executive Directors commended the authorities for the sound macroeconomic policies and reform implementation that have helped improve the resilience of the Moroccan economy, upgrade the fiscal and financial policy frameworks, and increase economic diversification,” the IMF said in a statement following consultations.

“To consolidate the gains achieved and promote higher and more inclusive growth, Directors underscored the need to maintain sound fiscal and monetary policies and to step up structural reform efforts,” it added.

The IMF said it supported Morocco’s plans for a more flexible currency and new policies, “which will help the economy to absorb external shocks and remain competitive.”

In July, Morocco’s central bank postponed a planned announcement of the first phase of the reform. The central bank gave no reason for the delay, but officials have since then said the government needed to further study the plan.

 

(Writing by Ulf Laessing; Editing by James Dalgleish)

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South Africa’s Sibanye-Stillwater buys troubled platinum miner Lonmin

14 December 2017 Comments (0) Actualites

By Zandi Shabalala and Barbara Lewis

LONDON (Reuters) – South Africa’s Sibanye-Stillwater has agreed to buy Lonmin for about 285 million pounds ($382 million) in an all-share deal that drove shares in the troubled London-listed platinum miner up by more than a fifth.

Lonmin, the world’s third biggest platinum producer, has been battling weak global platinum prices and soaring operating costs in South Africa, shrinking the company’s market value by 98 percent in the past five years.

After the announcement, Lonmin’s shares jumped 23 percent, while shares in Sibanye-Stillwater, which will become the world’s second largest platinum producer on completion of the deal, fell 5 percent in Johannesburg.

“This is a bailout deal for Lonmin,” Nedbank precious metals analyst Leon Esterhuizen said “It makes for a good match, but it doesn’t resolve oversupply of the PGM (platinum group metals) industry.”

Global platinum prices are trading around their lowest levels since early 2016, under pressure from bloated supply and declining demand from the automotive industry.

“The flexibility inherent in the larger regional PGM footprint will create a more robust business, better able to withstand volatile PGM prices and exchange rates,” Sibanye Chief Executive Officer Neal Froneman said in a statement.

Under the offer, Lonmin shareholders would receive 0.967 new Sibanye-Stillwater shares for each Lonmin share, the firms said.

Following completion of the deal Lonmin shareholders would hold about 11.3 percent of the enlarged group.

“While in some way I am sad, I am sure has hell that this is the right thing for the sustainability of the company,” Lonmin CEO Ben Magara told Reuters.

Under Sibanye’s plans, Lonmin would put all of its older mines on care and maintenance, which means operations stop but they are kept in a condition to resume in future. The plan involves cutting 12,600 jobs in the next three years with a further 890 jobs at risk, a Sibanye presentation showed.

Job cuts are a particularly sensitive in South Africa where unemployment runs at around 27 percent. Lonmin now employs about 35,500 people. All of its mines are in South Africa.

The revised mine plan assumes “lower for longer” platinum prices, the presentation said.

“SUFFERING” SHAREHOLDERS

Sibanye and Lonmin have been talking for months, sources said, after looking at Lonmin a few years ago before turning to another deal. One banking source told Reuters the rest of Lonmin’s portfolio would be reviewed over time.

Lonmin, listed in London since 1961, has been undergoing an operational review to help resolve its cash crunch that led its banks to relax some debt covenants. The miner has tapped shareholders for cash three times since 2009.

“Doubtless welcome news to long suffering Lonmin shareholders averting the need to dig into their pockets once again to refinance the company in its regular three to four year refinancing cycle,” said Marc Elliott, analyst at Investec bank.

He said Sibanye management could get the most value from Lonmin’s smelting and refining assets and could also be betting on a rebound in the price of platinum group metals.

Lonmin emerged in the 1990s after the split up of Lonrho, a sprawling conglomerate run for three decades by buccaneering tycoon Tiny Rowland, whose firm was branded in the 1970s by Britain’s prime minister at the time as the “unacceptable face of capitalism”.

Lonmin was in the headlines again in 2012 when 34 striking miners at its Marikana facility were killed by police in the bloodiest confrontation since white rule ended in South Africa.

Sibanye, spun off from Gold Fields, made its first foray into platinum by acquiring Anglo American Platinum’s labour intensive Rustenburg operations in 2015. The company also bought Aquarius Platinum and U.S. palladium producer Stillwater.

With Lonmin, Sibanye will leapfrog another troubled miner, Impala Platinum, to become the world’s No. 2 platinum producer.

The government-owned Public Investment Corporation (PIC), which owns 30 percent of Lonmin, increased its stake in Sibanye in November to 10 percent.

PIC was not immediately available to comment on the deal.

In November, Reuters reported on its array of measures to save cash after it delayed its annual financial results pending conclusion of a business review.

UBS and HSBC advised Sibanye on the deal.

(Additional reporting by Noor Zainab Hussain, Ed Stoddard and Clara Denina; Editing by Adrian Croft and Edmund Blair)

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Morocco announces auto industry deals worth $1.45 bln

12 December 2017 Comments (0) Actualites, Africa, Business

RABAT (Reuters) – Morocco said on Monday it had signed deals for 26 auto industry projects worth a total of 1.23 billion euros ($1.45 billion) as it seeks to build its position as an international hub for the sector.

The deals include six agreements with French company Renault to expand an “industry ecosystem” allowing the firm to increase local sourcing of car components to 55 percent, according to a government statement.

Renault has a large factory in the northern Moroccan city of Tangiers that opened in 2012, and an older assembly plant in Casablanca.

Another 13 of the new projects are planned as part of a manufacturing hub linked to a PSA Peugeot Citroen factory under construction in Kenitra, north of the capital, Rabat.

That plant is due to open in 2019 and initially produce 90,000 vehicles a year.

The projects announced on Monday are with companies from France, Spain, Italy, China, South Korea, Japan and the United States, and are expected to create more than 11,500 jobs, the government statement said.

Eleven of the companies will be operating in Morocco for the first time, Abdel Wahid Rahal, a senior official at the ministry for industry, investment, trade and digital economy, told Reuters.

On Saturday, officials announced a memorandum of understanding with Chinese automaker BYD to build an electric car plant near Tangier that is expected to create 2,500 jobs. They gave no details on the value of the deal.

Unlike many countries in the region, Morocco has avoided a big drop in foreign investment following the global financial crisis and the Arab Spring uprisings of 2011, partly by marketing itself as an export base for Europe, the Middle East and Africa.

The kingdom has attracted a number of big auto and aerospace investors in recent years.

 

($1 = 0.8495 euros)

 

(Reporting by Zakia Abdennebi; Writing by Aidan Lewis; Editing by Peter Cooney)

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Steinhoff accounting irregularities trigger share crash, CEO exit

6 December 2017 Comments (0) Actualites, Africa, Business

JOHANNESBURG (Reuters) – Steinhoff International shares crashed on Wednesday after it revealed accounting irregularities and its CEO quit, shocking investors who had backed the rapid reinvention of a South African furniture chain into an international retail empire.

The company said late on Tuesday that “new information has come to light today which relates to accounting irregularities requiring further investigation” and that billionaire Christo Wiese, its largest shareholder and chairman, would take charge.

Steinhoff said chief executive Markus Jooste, who had been at the helm for nearly 20 years and oversaw its expansion to one of the world’s largest household goods retailers, had resigned with immediate effect and consultants PwC would undertake an “independent investigation”.

Steinhoff has been aggressively expanding in developed markets since moving its primary share listing from Johannesburg to Frankfurt in 2015, snapping up Britain’s Poundland, U.S-based Mattress Firm and Australia’s Fantastic.

Steinhoff said Wiese would “embark on a detailed review of all aspects of the company’s business with a view to maximising shareholder value”, but its South African shares slumped 65 percent to an eight-year low of 15.87 by 1120 GMT. Its stock was down in Frankfurt by 66 percent following the news.

Steinhoff has been under investigation for suspected accounting irregularities by the state prosecutor in Oldenburg, Germany since 2015. Steinhoff has said that was a tax case relating to whether revenues were booked correctly, and taxable profit correctly declared.

Reuters reported last month that Steinhoff did not tell investors about almost $1 billion in transactions with a related company, despite laws that some experts believe require it to do so.

It is unclear what accounting irregularities the company was referring to in its statement on Wednesday. A spokesman declined further comment and attempts by Reuters to contact Jooste were not successful.

The development had wider repurcussions too, with the chief executive of Steinhoff African Retail (STAR), part of Steinhoff which includes the control of Shoprite, also resigning on Wednesday and its shares falling 21.5 percent to 19.30 rand by 0855 GMT.

“In light of these developments at Steinhoff, STAR’s existing CEO, Ben la Grange has decided to step down as CEO of STAR,” the company said.

 

TAX RATE QUESTIONS

Analysts have long questioned how Steinhoff managed to achieve such a low tax rate. Its tax rate has averaged 12 percent over the past five years — half the headline corporate tax rate in its main markets and less than half the rates paid by listed competitors including France’s Casino, Germany’s Metro AG and South Africa’s Woolworths.

Experts say such low tax rates can be the result of complex corporate structures which stretch accounting rules and such arrangements are occasionally challenged by courts as unlawful.

“The company recorded a very unusual tax rate of c. 15 percent and also guided that this would be the rate going forward,” Juergen Kolb, an analyst at Kepler Cheuvreux, said in a note, adding that if this tax rate was at risk it could also hit Steinhoff’s cashflow.

Kolb also raised the possibility that as chairman, Wiese’s role could now come under scrutiny too.

Steinhoff did not respond to requests for information about what, if anything, Wiese knew about the accounting problems now being investigated before Tuesday.

Investors also told Reuters they are concerned Wiese may be forced to sell shares he bought last year with borrowed money.

Wiese borrowed 1.6 billion euros ($1.9 billion) to buy additional Steinhoff shares through a family trust in September 2016, pledging 3.2 billion euros of his existing holding as security to the investment banks that lent the money.

With the share price plunge taking the security below the value of the loan, Wiese may be required by the financing banks — Citi, Goldman, HSBC and Nomura — to post more shares as collateral, or sell part of his holding.

($1 = 0.8459 euros)

 

(By TJ Strydom. Reporting by TJ Strydom; additional reporting by Tanisha Heiberg, Tom Bergin and Alasdair Pal; writing by Alexander Smith; editing by Tom Pfeiffer and Keith Weir)

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African Development Bank gives $148 million to support Namibia’s education, agriculture

5 December 2017 Comments (0) Actualites, Africa, Agriculture, Education

CAPE TOWN/WINDHOEK (Reuters) – The African Development Bank (AfDB) has approved a total of 2 billion rand 148 million) in loans to boost Namibia’s education and agriculture sectors, it said on Tuesday.

The funds are aimed at helping reduce youth unemployment by boosting technical and vocational training, and reducing food imports by the South-western African country.

Both the education and agriculture projects will receive additional Namibian government contribution, the AfDB said.

The south-western nation’s unemployment rate jumped to 34 percent of the working population in 2016 from 28.1 percent in 2014, the last time a labour force survey was conducted by the Namibia Statistics Agency.

($1 = 13.4738 rand)

 

(Reporting by Wendell Roelf in Cape Town and Nyasha Nyaungwa in Windhoek; Editing by James Macharia)

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South Africa’s private-sector activity slows in November: PMI

5 December 2017 Comments (0) Actualites, Africa, Economy

JOHANNESBURG, Dec 5 (Reuters) – South African private sector activity slowed in November as new orders and output fell, a survey showed on Tuesday.

The Standard Bank Purchasing Managers’ Index (PMI), compiled by IHS Markit, fell to 48.8 in November from 49.6 in October, staying below the 50 mark that separates expansion from

contraction.

“Lower underlying demand formed the basis for the decline as new orders fell at the quickest pace observed since early 2016.

This led output to fall, and at a faster rate than that noted in the previous month,” IHS Markit said in a statement.

South Africa’s economic gloom has been compounded by allegations of corruption in state-owned companies and of influence-peddling in government that have hurt investor confidence.

The ruling African National Congress will this month elect a successor to President Jacob Zuma as party chief, adding to the climate of uncertainty.

“Apart from South Africa’s economy being characterised by generally weak growth, we note that the rating agency review on November 24th and the upcoming ANC elective conference will have

delayed production and consumption decisions,” Standard Bank economist Kim Silberman said.

S&P Global Ratings downgraded South African debt to junk status on Nov. 24, citing its deteriorating economic outlook and public finances. Moody’s put the country on review for a

downgrade.

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