Africa Business Briefs

SA to sign deals for 1 143 MW
CAPE TOWN – South Africa expects to sign contracts this month to source up to 1 143 megawatts from industrial co-generation processes to help ease a power supply shortage in the country, a minister said yesterday.

Public Enterprises Minister Barbara Hogan, whose department oversees state-owned power utility Eskom, said the deals could include partners such as petrochemicals group Sasol, the world’s biggest coal to fuel producer, and the world’s biggest producer of fine paper Sappi . ‘Sasol, Sappi and those sorts of companies, will now be signing co-generation agreements with Eskom to provide additional power,’ Hogan told media in parliament. South African manufacturers have long said they could produce up to 2 000 MW under co-generation, but have faced pricing and regulatory hurdles that have prevented the sector from selling electricity to Eskom.Bidvest lifts half-year profitJOHANNESBURG – South African industrial group Bidvest posted a nine per cent rise in first-half profit helped by cost cuts and a strong performance from its Asia-Pacific unit. Bidvest, whose activities cover auto retailing, freight services and food distribution, said yesterday headline earnings per share rose to 495 cents in the six months to end-December, in line with its forecast range of an eight to ten per cent rise. The company said the results were enhanced by a R2 billion reduction in working capital and lower finance charges due to falling interest rates. Bidvest said trading conditions in southern Africa – excluding Namibia – were challenging, but its European unit ‘held up well’ while its Asian business returned strong results. Revenue fell 6,5 per cent to R56,1 billion, hit by lower import demand, unfavourable swings in the rand currency and deflation.SA’s PMI surges to 3-year highJOHANNESBURG – South Africa’s purchasing managers’ index (PMI) jumped to a seasonally-adjusted 60,4 in February, a near-three-year high, pointing to further recovery on the production side of the economy, a survey showed yesterday. Sponsor Kagiso Securities said the key measure of manufacturing activity increased from 53,6 in January to its highest level since March 2007, beating the breakeven 50 mark for the fourth consecutive month. ‘The continued upward trend of the index during the first two months of 2010 points to a faster growth in actual factory production at the start of the year,’ André Coetzee, head of fixed income at Kagiso Securities, said in a statement. ‘(This suggests) that manufacturing in all likelihood remained a key sector driving the overall growth in the first quarter of 2010.’
Massive strike looms at Gold FieldsJOHANNESBURG – South Africa’s biggest union plans an indefinite strike starting this Sunday at Gold Fields’ operations in the country that would stop output, the world’s No 4 gold producer said yesterday. Gold Fields said the National Union of Mineworkers (NUM) served the company, Africa’s second biggest gold producer, with a notice that it would remain on strike until the company abolishes a contentious work health and safety fitness test. The union said Gold Fields uses the test as a tool for laying off existing workers, but the company argued the examination – a requirement under South African mining law – has been in use since 2006 to test only new recruits to ensure they meet the standards of fitness required to work underground. NUM spokesman Lesiba Seshoka said the union had only targeted Gold Fields among its peers in the mining industry because the group was using the test to retrench existing workers, while other firms use it only on new hires.
New railway to boost cargoNAIROBI – Kenya and Uganda expect cargo trains running on a standard gauge railway due to be operational in three years will treble speeds and carry ten times more freight than trains now, a senior official said yesterday. The new railway linking Kenya’s Mombasa port to Uganda’s capital Kampala via Nairobi is meant to supplement an existing metre gauge railway which was built by the British at the turn of the previous century. ‘This (new) railway is a high capacity railway line in the sense that the loads for that railway are beyond 30 million tonnes per year,’ Nduva Muli, Kenya Railways Managing Director said.
Guinea will talk to RusalCONAKRY – Guinea’s new government is prepared to talk with UC Rusal to resolve a dispute over the Russian group’s ownership of the Friguia alumina refinery, Guinean Mines Minister Mahmoud Thiam told Reuters. Security of title is a major worry for companies operating in Guinea, the world’s biggest bauxite supplier, which was shaken by a coup in December 2008 and has a transitional government tasked with setting elections. A Guinean court last year ruled Rusal bought Friguia, the biggest industrial project in Guinea, illegally in 2006, vastly underpaying for the factory, but Rusal did not accept the decision. Talks were slated to begin yesterday, but Guinea had yet to choose its representatives, Thiam said.