Headlines

South Africa’s government has announced plans to slash its public sector wage bill, setting President Cyril Ramaphosa on a collision course with the country’s powerful trade unions as he seeks to fix the biggest ever fiscal deficit in the post-apartheid era and avoid another ratings downgrade, the Financial Times reported. Tito Mboweni, Mr Ramaphosa’s finance minister, said in a budget speech on Wednesday that the state plans to cut 160bn rand ($10.5bn) from civil-servant pay in the next three years in order to halt a rapid rise in public debts between 2020 and 2021.

China’s battered banks are being asked to sacrifice profits to help millions of cash-squeezed companies struggling under the weight of the coronavirus outbreak, Bloomberg News reported. Now they may finally see some relief for themselves. Liu Guoqiang, a deputy governor of the People’s Bank of China, said over the weekend that policy makers are considering lowering their benchmark deposit rate for the first time in five years.

As Argentina descends into a hellscape for creditors, with bond prices taking a fresh leg down as each new development saps spirits, there are a few securities bucking the trend, Bloomberg News reported. Investors are sorting through billions of dollars of Argentine debt, some of it trading at deeply distressed levels below 50 cents on the dollar, in search of bonds that are being unfairly punished for the federal government’s problems.

Lebanon has a lot more than just maturing Eurobonds to worry about. In addition to $31bn of those, the Middle Eastern nation’s central bank has $52.5bn of obligations in the form of foreign-currency deposits and certificates of deposit, according to calculations by Toby Iles and Jan Friederich, Hong Kong-based analysts at Fitch Ratings Ltd, Gulf Business reported. Mostly owed to Lebanese banks, these additional debts compound the country’s woes as it grapples with its deepest economic crisis in decades.

Finance Minister Nirmala Sitharaman said on Wednesday that banks have informed the Finance Ministry regarding the number of Micro, Small and Medium Enterprises (MSME) that have been restructured, approached and provided loans to, Republic World reported. The Finance Minister has also directed the banks to clear out all the pending MSMEs by March 15. This comes as FM Sitharaman informed that the Government has asked the Reserve Bank of India (RBI) to extend the deadline for restructuring the debt scheme for MSME beyond March 31, 2020.

Koon Holdings on Wednesday said that creditors have approved the scheme of arrangement for its subsidiary Koon Construction & Transport (KCT), as part of the group’s debt restructuring exercise, the Business Times reported. However, Koon Holdings has yet to put its own proposed scheme to a vote, as its creditors’ meeting on Tuesday was adjourned. Before the meeting began, a major creditor had requested the adjournment because it would like to receive more information before committing its vote, Koon Holdings said in a bourse filing.

Latin American and sub-Saharan African countries have taken out at least $152 billion in oil-, mineral- and metal-backed loans from China since 2004, easy money that has contributed to crippling debt levels, an NGO report said on Thursday, Reuters reported. The Natural Resource Governance Institute (NRGI) calculated that, including loans from other countries such as Russia and global commodity traders, the total amounted to $164 billion. Two Chinese state banks, China Development Bank and Eximbank, alone accounted for 77% of the loans, NRGI said in its report.

South Africa almost doubled the level of funding for the national airline to 16.4 billion rand ($1.1 billion), cash that will go toward supporting a restructuring plan for the technically insolvent carrier, Bloomberg News reported. The bailout will be used to service and pay debt previously guaranteed by the state over the “medium term,” Finance Minister Tito Mboweni said in his budget speech in Cape Town on Wednesday. The amount compares with 9.2 billion rand earmarked for South African Airways in October.

Domestic Ivorian cocoa exporters fear going bankrupt because they cannot compete with the higher prices multinational companies are paying for beans, the Ivory Coast’s traders association (GNI) told Reuters, Reuters reported. Western chocolate companies such as Lindt, Hershey and Ferrero pay a premium for sustainable cocoa made with fair trade certification, buying mainly from multinational companies such as Cargill, Olam and Barry Callebaut.

British shopping centre operator Hammerson almost halved its 2020 dividend on Tuesday after the collapse into administration of a number of UK retail chains and outlets cut its annual net rental income, Reuters reported. The company has been striving to reduce its net debt, which stood at 2.8 billion pounds at the end of last year, by offloading assets and refocusing on its city shopping centres and premium outlets division. The owner of London’s Brent Cross shopping centre said it expects to recommend a dividend of 14 pence for 2020, a 46% fall compared to last year.