Africa Business Briefs

SA tyre makers strike today
JOHANNESBURG – Tyre and rubber industry workers seeking higher wages will strike from today, the National Union of Metalworkers of South Africa said.
The union, which is seeking double-digit wage increases, said some of the foreign firms which would be hit include Bridgestone Corp, Dunlop and Continental. South Africa is responsible for about one per cent of global tyre production, according to government figures.

SA tyre makers strike today
JOHANNESBURG – Tyre and rubber industry workers seeking higher wages will strike from today, the National Union of Metalworkers of South Africa said. The union, which is seeking double-digit wage increases, said some of the foreign firms which would be hit include Bridgestone Corp, Dunlop and Continental. South Africa is responsible for about one per cent of global tyre production, according to government figures.SA’s PPI decreases JOHANNESBURG – South Africa’s producer price inflation slowed more-than-expected in July on easing commodity prices, hardening the case for a rate cut next month. Statistics South Africa said prices at the factory gate were at 7,7 per cent year-on-year in July compared with 9,4 per cent the previous month, below forecasts of 8,6 per cent. The month-on-month figure stood at 1,3 per cent, slowing sharply from 4,0 per cent in June, also beating forecasts of 2,3 per cent. PPI is seen slowing even further in coming months as weak domestic demand and a strong rand weighs. Analysts are calling for an interest rate cut when the monetary policy committee meets on Sep. 8-9.
Anglo takes SA to court JOHANNESBURG – Anglo American Plc said it was challenging South Africa’s granting of coal mining rights in court, while another company said it had given up a mining right to Impala Platinum. Anglo American’s legal challenge adds to ongoing disputes over mining rights in the resource-rich nation, which have raised investor concerns over transparency and governance. Separately Keysha Investments 220 said it had given up a prospecting right that the DMR had already awarded to Impala Platinum, the world’s second-largest platinum producer. The Business Report daily said Anglo American was taking the Department of Mineral Resources to court over its decision to grant prospecting rights to Melody Street Trading, a black economic empowerment company, in 2009. Anglo American spokesman Pranill Ramchander said that a court application had been filed but declined to give any details.
Nigerian power sector privatisationLAGOS – Nigeria will hand over management of its electricity grid to a Canadian, Indian or Irish firm by year-end as it embarks on the multi-billion dollar privatisation of its dilapidated power sector, a top official said on Friday. Bart Nnaji, head of a presidential taskforce charged with reforming Nigeria’s power sector, said Manitoba Hydro, owned by the Canadian province of Manitoba, India’s Power Grid Corp and Ireland’s Electricity Supply Board (ESB) were the three final bidders to manage the transmission network. President Goodluck Jonathan on Thursday unveiled a blueprint for ending chronic power shortages in Africa’s most populous nation, which estimates its electricity sector needs US$10 billion of annual investment over the next decade. Under the strategy, Nigeria will privatise power generation and distribution. Government will continue to own the national grid but its management will be privatised. Nnaji said Nigeria would hold a ‘retreat’ for investors from around the world in mid-October to further explain its plans.
Sierra Leone diamond exports jump FREETOWN – Sierra Leone exported US$51,4 million worth of diamonds in the first six months of 2010, up 43 per cent on the first half of last year, according to a government document seen by Reuters. A global rebound in diamond prices, augmented by government measures to encourage production, accounts for the increase in value, said Deputy Minister of Mineral Resources Ignosis Koroma. The West African country shipped stones valued at US$35,9 million in the first six months of 2009, ending the year at exports worth US$78 million. Overall diamond prices are up eight per cent on this time last year, according to independent news provider PolishedPrices, after slumping in 2009 when demand for luxury goods fell as a result of the global recession.Old Mutual to list property fundJOHANNESBURG – Anglo-South African insurer Old Mutual said it aims to list a R12 billion property fund on the Johannesburg Stock Exchange by mid-2011. The Triangle Real Estate Core Fund will be made of 40 retail, industrial and office properties and will be the third-largest fund by value among the JSE’s listed property funds, Old Mutual said. Five large retail properties will make up more than 50 per cent of the fund’s value, Old Mutual said.
Zambia opens railroad shortcutBLANTYRE – Zambian President Rupiah Banda on Friday opened a US$10 million rail connection through Malawi to the Mozambican port of Nacala. Transport experts in Zambia say the link will cut the distance from Zambia to the Indian Ocean port by 800 kilometres when compared with road usage, reducing the country’s import and export costs by half. ‘The railway line will enhance regional integration and will provide Zambia’s imports and exports with the shorter route to the port of Nacala,’ Banda said in a live broadcast on Malawian state radio at the Zambian border town of Chipata. Malawi’s President Bingu wa Mutharika also attended the ceremony and said the railroad will be of ‘vital importance to the development of Malawi, Zambia as well as Mozambique’.Tullow, Heritage lose oil fieldKAMPALA – Uganda has repossessed an oil field that was jointly controlled by Anglo-Irish Tullow and Canada’s Heritage because the firms failed to renew their license. The two companies each owned a 50 per cent share in the field located in Uganda’s Lake Albert Basin. The license for the field expired in February. Uganda is entitled to reclaim the right six months after its expiry in a accordance with the terms of the production sharing agreements signed with both companies, Oil Minister Hilary Onek said. According to Uganda, both companies should apply for a renewal, but Tullow maintains that they fully own the oil field after buying shares from Heritage last month. Uganda insists that this deal will remain incomplete until the government receives the full capital tax gains from the transaction between the two firms, a figure estimated at more than US$400 million.Massmart profit downJOHANNESBURG – South Africa’s Massmart booked a six per cent fall in full-year profit, hit largely by weak demand in the aftermath of the global recession and said it expects gradual improvement this year. Massmart, which runs hardware and discount electronics stores in 14 African countries, said headline earnings per share totaled 567 cents in the year to end-June from 605 cents a year earlier. The high-volume and low-margin retailer expects to achieve profit growth for the current full year on the back of good trading environment. Massmart said sales increased ten per cent to R47,5 billion, helped partly by new stores. Massmart said in a statement it expects its food and African businesses to underperform in the short term, but sees a gradual improvement through this financial year.

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