<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107068685-gettyimages-1371981344-_sol2164e-820x462.jpeg" alt="" class="wp-image-489283" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107068685-gettyimages-1371981344-_sol2164e-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107068685-gettyimages-1371981344-_sol2164e-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107068685-gettyimages-1371981344-_sol2164e-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107068685-gettyimages-1371981344-_sol2164e-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107068685-gettyimages-1371981344-_sol2164e.jpeg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The war between Russia and Ukraine — both major producers of food commodities and energy — has disrupted global production, trade and supply in these areas, leading to a surge in prices. Solstock | E+ | Getty Images</figcaption></figure>



U.K. inflation came in hotter than expected with a drop to 2.3% in April, the Office for National Statistics said Wednesday, prompting traders to pull back from bets on a June interest rate cut from the British central bank.



The headline reading declined from 3.2% in March. The April print marked the first time inflation has been below 3% since July 2021 and came within touching distance of the Bank of England’s 2% target.



Economists polled by Reuters had nevertheless expected a steeper drop to 2.1% in April.



Services inflation — a key measure being watched by the BOE because of the dominance of the sector in the U.K. economy and its impact on domestically-generated price rises — eased only slightly to 5.9% from 6%. That missed a forecast of 5.5% from both a Reuters poll and the British central bank.



Core inflation, excluding energy, food, alcohol and tobacco, dipped to 3.9% in April from 4.2% in March.



A dramatic drop in the headline rate was widely expected because of the year-on-year decline in energy prices. Investors were instead set to focus on core and services inflation, after BOE policymakers indicated they would be willing to cut interest rates some time in the summer, but stressed that the timing would depend on fresh data.



Following the print, money markets slashed the probability of a June rate cut to just 15%, down from 50% earlier in the day.



<h2 class="wp-block-heading" id="h-june-cut-unlikely"><a></a>June cut ‘unlikely’</h2>



Both core and services were “disappointing,” said Suren Thiru, economics director of the Institute of Chartered Accountants in England and Wales.



“Lingering concerns over underlying inflationary pressures mean a June rate cut is unlikely. However, these figures may convince more rate setters to vote to ease policy, providing a signal that a summer rate cut is still possible,” Thiru said in a note.



That positions the European Central Bank as the next major central bank likely to start bringing down rates, as its policymakers continue to suggest it would take a major shock to prevent a June cut. Members of the U.S. Federal Reserve have meanwhile struck a significantly more hawkish tone in recent weeks, pushing back market expectations for a cut statesside until after September at the earliest.



Paul Dales, chief U.K. economist at Capital Economics, said the latest inflation data has made a June rate cut from the Bank of England unlikely, and “casts some doubt over August too.”



That is particularly due to the high services figure, Dales said in a note, which “suggests the persistence in domestic inflation is fading even slower than the BOE had assumed.”



U.K. Prime Minister Rishi Sunak said on social platform X that “inflation is back to where it should be.”



Sunak’s ruling Conservative Party has been hoping for signs of an improving economic environment, as it lags in the polls ahead of a national election that must take place before the end of January 2025. The U.K. economy exited a shallow recession in the first quarter of the year, recording 0.6% growth.



BOE Governor Andrew Bailey has stressed that the central bank will remain politically independent in deciding the timeline of the next rate cut, irrespective of the forthcoming election.

107068685-gettyimages-1371981344-_sol2164e

UK inflation comes in hotter than expected, slashing June rate cut bets

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-820x547.jpg" alt="" class="wp-image-486652" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">SAINT PETERSBURG, RUSSIA &#8211; 2023/11/02: The national flag of the Federal Republic of Nigeria as a participating country at the 12th St. Petersburg International Gas Forum (SPIGF 2023). (Photo by Maksim Konstantinov/SOPA Images/LightRocket via Getty Images)</figcaption></figure>



ABUJA, May 21 (Reuters)&nbsp;&#8211;&nbsp;Nigeria&#8217;s central bank raised its benchmark lending rate&nbsp;by 150 basis points to&nbsp;26.25% from 24.75%&nbsp;NGCBIR=ECI, in a decision announced on Tuesday.



Analysts had widely predicted another hike given inflation has continued to soar and the local naira currency&nbsp;NGN=D1&nbsp;has been highly volatile.



The decision is the third rate increase this year, after hikes of 200 basis points in March and 400 basis points in February.



Inflation&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N3HI4A6&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">reached</a>&nbsp;a 28-year high of 33.69% year-on-year in April&nbsp;NGCPIY=ECI, spurred by the government slashing petrol and electricity subsidies and twice devaluing the naira.



(Reporting by Chijioke Ohuocha, Elisha Bala-Gbogbo, MacDonald DzirutweEditing by Bate Felix)

The national flag of the Federal Republic of Nigeria as a

Nigeria’s central bank raises benchmark rate to 26.25%

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/A-Singapore-Airlines-Boeing-777-300ER-passenger-aircraft-pictured-above-London-in-August-2022-820x462.jpg" alt="" class="wp-image-489003" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/A-Singapore-Airlines-Boeing-777-300ER-passenger-aircraft-pictured-above-London-in-August-2022-820x462.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/A-Singapore-Airlines-Boeing-777-300ER-passenger-aircraft-pictured-above-London-in-August-2022-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/A-Singapore-Airlines-Boeing-777-300ER-passenger-aircraft-pictured-above-London-in-August-2022-160x90.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/A-Singapore-Airlines-Boeing-777-300ER-passenger-aircraft-pictured-above-London-in-August-2022-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/A-Singapore-Airlines-Boeing-777-300ER-passenger-aircraft-pictured-above-London-in-August-2022.jpg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A Singapore Airlines Boeing 777-300ER passenger aircraft, pictured above London in August 2022. Nurphoto | Nurphoto | Getty Images</figcaption></figure>



One person died aboard a Singapore Airlines flight which encountered severe turbulence and diverted to Bangkok, the airline said Tuesday.



The flight had left London for Singapore. The aircraft was rerouted to land at the Suvarnabhumi Airport in Bangkok, according to Flightradar24 data.



“We can confirm that there are injuries and one fatality on board the Boeing 777-300ER. There were a total of 211 passengers and 18 crew on board,” the company said on the Facebook.



“Singapore Airlines flight&nbsp;#SQ321, operating from London (Heathrow) to Singapore on 20 May 2024, encountered severe turbulence en-route. The aircraft diverted to Bangkok and landed at 1545hrs local time on 21 May 2024,” it added.



This is a breaking news story, please check back for updates.

A-Singapore-Airlines-Boeing-777-300ER-passenger-aircraft-pictured-above-London-in-August-2022

One dead as Singapore Airlines flight encounters ‘severe turbulence’

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="429" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-820x429.jpg" alt="" class="wp-image-488997" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-820x429.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-160x84.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-768x402.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-1536x804.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Britain&#8217;s Prime Minister Rishi Sunak speaks during the closing press conference on the second day of the UK Artificial Intelligence (AI) Safety Summit at Bletchley Park, near Milton Keynes, Britain November 2, 2023. Justin Tallis/Pool via REUTERS/File Photo</figcaption></figure>



SEOUL, May 21 (Reuters)&nbsp;&#8211;&nbsp;Sixteen companies involved in&nbsp;AI&nbsp;including Alphabet&#8217;s Google&nbsp;GOOGL.O, Meta&nbsp;META.O, Microsoft&nbsp;MSFT.O&nbsp;and OpenAI, as well as companies from China, South Korea and the United Arab Emirates have committed to safe development of the technology.



The announcement unveiled in a UK government statement on Tuesday came as South Korea and Britain host a global&nbsp;AI&nbsp;summit in Seoul at a time when the breakneck pace of&nbsp;AI&nbsp;innovation leaves governments scrambling to keep up.



The agreement is a step up from the number of&nbsp;<a href="https://www.gov.uk/government/news/world-leaders-top-ai-companies-set-out-plan-for-safety-testing-of-frontier-as-first-global-ai-safety-summit-concludes" target="_blank" rel="noreferrer noopener">commitments</a>at&nbsp;the first global&nbsp;AI&nbsp;summit held six months ago,&nbsp;the statement said.



Zhipu.ai,&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AP:4295882451&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">backed by</a>&nbsp;Chinese tech giants Alibaba&nbsp;9988.HK, Tencent&nbsp;0700.HK, Meituan&nbsp;3690.HK&nbsp;and Xiaomi&nbsp;1810.HK, as well as UAE&#8217;s Technology Innovation Institute were among the 16 companies pledging to publish safety frameworks on how they will measure risks of frontier&nbsp;AI&nbsp;models.



The firms, also including Amazon&nbsp;AMZN.O, IBM&nbsp;IBM.N&nbsp;and Samsung Electronics&nbsp;005930.KS, voluntarily committed to not develop or deploy&nbsp;AI&nbsp;models if the risks cannot be sufficiently mitigated, and to ensure governance and transparency on approaches to&nbsp;AI&nbsp;safety, the statement said.



&#8220;It&#8217;s vital to get international agreement on the &#8216;red lines&#8217; where&nbsp;AI&nbsp;development would become unacceptably dangerous to public safety,&#8221; said Beth Barnes, founder at METR, a non-profit for&nbsp;AI&nbsp;model safety.



The artificial intelligence (AI) summit in Seoul this week&nbsp;aims to build on a broad agreement at the first summit&nbsp;held in the United Kingdom to better address a wider array of&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL1N3HN0YN&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">risks</a>.



At the November summit, Tesla&#8217;s Elon Musk and OpenAI&nbsp;CEO Sam Altman mingled with some of their fiercest critics, while China co-signed the &#8220;<a href="https://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=&amp;ved=2ahUKEwjqhuz975qGAxVXklYBHVHUApwQFnoECAYQAQ&amp;url=https%3A%2F%2Fwww.gov.uk%2Fgovernment%2Fpublications%2Fai-safety-summit-2023-the-bletchley-declaration%2Fthe-bletchley-declaration-by-countries-attending-the-ai-safety-summit-1-2-november-2023&amp;usg=AOvVaw3ArAa5McYZwdnAzGZ3BhKc&amp;opi=89978449">Bletchley Declaration</a>&#8221; on collectively managing&nbsp;AI&nbsp;risks alongside the United States and others.



British Prime Minister Rishi Sunak and South Korean President Yoon Suk Yeol will oversee a virtual summit later on Tuesday, followed by a ministerial session on Wednesday.



This week&#8217;s summit will address &#8220;building&#8230; on the commitment from the companies, also looking at how the (AI&nbsp;safety) institutes will work together,&#8221; Britain&#8217;s Technology Secretary Michelle Donelan told Reuters on Tuesday.



Since November, discussion on&nbsp;AI&nbsp;regulation has shifted from longer-term doomsday scenarios to &#8220;practical concerns&#8221; such as how to use&nbsp;AI&nbsp;in areas like medicine or finance, said&nbsp;Aidan Gomez, co-founder of large language model firm Cohere.



Industry participants wanted&nbsp;AI&nbsp;regulation that will give clarity and security on where the companies should invest, while avoiding entrenching big tech, Gomez said.



With countries such as the UK and U.S. establishing state-backed&nbsp;AI&nbsp;Safety Institutes for evaluating&nbsp;AI&nbsp;models and others expected to follow suit,&nbsp;AI&nbsp;firms are also concerned about the interoperability between jurisdictions, analysts said.



Representatives of the Group of Seven (G7) major democracies are expected to take part in the virtual summit, while Singapore and Australia were also invited, a South Korean presidential official said.



China will not participate in the virtual summit but is expected to attend Wednesday&#8217;s in-person ministerial session, the official said.



South Korea&#8217;s foreign ministry said Musk, former CEO of Google Eric Schmidt, Samsung Electronics&#8217; Chairman Jay Y. Lee and other&nbsp;AI&nbsp;industry leaders will participate in the summit.



(Reporting by Joyce Lee; Editing by Ed Davies and Christian Schmollnger)

AI-summit-secures-safety-commitments-from-16-companies

AI summit secures safety commitments from 16 companies

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="519" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-820x519.jpg" alt="" class="wp-image-488951" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-820x519.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-300x190.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-142x90.jpg 142w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-768x486.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-1536x973.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A small toy figure and mineral imitation are seen in front of the BHP logo in this illustration taken November 19, 2021. REUTERS/Dado Ruvic/Illustration/File Photo</figcaption></figure>



PERTH, May 21 (Reuters)&nbsp;&#8211;&nbsp;Shares of&nbsp;BHP&nbsp;Group&nbsp;BHP.AX&nbsp;touched a three-month high on Tuesday about 36 hours ahead of a&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N3HI07V&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">deadline</a>&nbsp;to lodge a formal bid for rival miner Anglo American&nbsp;AAL.L, which last week rejected a sweetened $43 billion takeover proposal.



The world&#8217;s largest listed miner&#8217;s shares are benefiting from good news including fresh stimulus for China&#8217;s property sector, copper prices reaching record highs and a growing view that&nbsp;BHP&nbsp;will not make another tilt at Anglo, according to Andy Forster, senior investment officer at Argo Investments, a&nbsp;BHP&nbsp;shareholder.



&#8220;We saw last week that they had a bit of a bounce after rejection by Anglo,&#8221; he said. &#8220;I think they&#8217;re going to stay disciplined. I&#8217;d be surprised if they&#8217;d come back at this late stage given the lukewarm response from Anglo&#8217;s board to the previous offers.&#8221;



Under UK takeover rules,&nbsp;BHP&nbsp;has until 1600 GMT on Wednesday to make a binding bid for Anglo American or it will be forced to walk away for at least six months. If the companies reach an agreement in the meantime, an extension can be granted.



BHP&nbsp;declined to comment on Tuesday. Its shares were up 0.5% to A$45.93 in afternoon trading. Anglo&#8217;s London-listed shares closed 0.1% higher at 26.80 pounds on Monday.



Anglo&#8217;s board has already&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL4N3HG2RJ&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">knocked back</a>&nbsp;two all-share proposals from&nbsp;BHP&nbsp;as inadequate and too difficult to execute and last week unveiled plans for a&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL4N3HH1FT&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">break-up</a>&nbsp;to focus on energy transition metal copper while spinning out or selling its coal, nickel, diamond and platinum businesses.



The copper assets make strategic sense for&nbsp;BHP&nbsp;but the longer the deal takes to close, the more likely it is a competitor lobs a rival bid for some of Anglo&#8217;s assets, according to Hayden Bairstow, an analyst at Australian stockbroker Argonaut.



&#8220;The risk of waiting is that Anglo&#8217;s metallurgical coal assets go to someone else or an interloper like Glencore comes in with a more compelling deal,&#8221; he said.



It would take Anglo a minimum of six to 12 months to run a sales process for the coal assets, according to an Australia-based investment banker who spoke on condition of anonymity.



Bankers are now jostling to get business from potential buyers, the person added.



Jefferies analysts said last week that&nbsp;BHP&nbsp;could be interested in the coal assets if it did not succeed in its bid for Anglo, given it owns nearby mines.



BHP&nbsp;would need to boost its latest offer by about 30% to reflect fair value for Anglo and its key copper assets, JPMorgan analysts said in a note last week.



Both of&nbsp;BHP&#8217;s offers required Anglo divest its platinum and iron ore assets in South Africa, where it employs more than 40,000 people.



BHP&nbsp;has told investors it&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL4N3H90QY&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">will not drop</a>&nbsp;its requirement for Anglo to demerge those businesses as a condition of the deal.



($1 = 0.7869 pounds)



ANALYSIS-BHP&#8217;s options for Anglo American deal narrow as deadline looms&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N3HI07V&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



(Reporting by Melanie Burton in Perth, Lewis Jackson in Sydney and Himanshi Akhand in Bengaluru; Editing by Praveen Menon and Jamie Freed)

FILE PHOTO: BHP shares jump 2.3% after Anglo announces break-up plan

BHP shares hit 3-month high as deadline for formal Anglo bid looms

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="552" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Global-oil-markets-weaken-as-sluggish-demand-leaves-overhang-820x552.jpg" alt="" class="wp-image-488708" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Global-oil-markets-weaken-as-sluggish-demand-leaves-overhang-820x552.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Global-oil-markets-weaken-as-sluggish-demand-leaves-overhang-300x202.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Global-oil-markets-weaken-as-sluggish-demand-leaves-overhang-134x90.jpg 134w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Global-oil-markets-weaken-as-sluggish-demand-leaves-overhang-768x517.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Global-oil-markets-weaken-as-sluggish-demand-leaves-overhang-1536x1033.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Global-oil-markets-weaken-as-sluggish-demand-leaves-overhang-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Miniatures of oil barrels and a rising stock graph are seen in this illustration taken January 15, 2024. REUTERS/Dado Ruvic/Illustration</figcaption></figure>



LONDON, May 20 (Reuters)&nbsp;&#8211;&nbsp;Global physical crude oil markets are weakening because of soft refinery demand and ample supply, traders and analysts told Reuters, in a move that could spell further weakness for benchmark crude futures.



The weakness indicates high interest rates and inflation are depressing consumer and industrial demand, especially in Europe, at a time when supply is rising from non-OPEC producers such as the United States. This could bolster arguments for OPEC+ to maintain production curbs at a June 1 meeting.



Demand from refiners is soft, even though their crude intake capacity has increased with the end of springtime maintenance.



“Rising refinery capacity has not been met by an expected rise in demand,” Saxo Bank analyst Ole Hansen said.



“Consumers are feeling the pressure from high interest rates and inflation, as well as trade wars and a challenging geopolitical environment.”



The weakness is exhibited particularly clearly in the North Sea, which produces crude grades that alongside U.S. WTI Midland crude underpin the Brent futures benchmark and help price two thirds of global oil.



The price differential of North Sea Forties crude&nbsp;BFO-FOT&nbsp;fell on May 14 to a discount of 97 cents to dated Brent, its widest since January 2023, according to data from S&amp;P Global Commodity Insights, known as Platts.



Similarly, Platts on May 13 assessed WTI Midland cargoes pricing in Northwest Europe at dated Brent minus 69 cents, the lowest assessment since WTI joined the North Sea grades that underpin the Brent benchmark last May.



&#8220;It is seemingly a relatively benign period for demand,&#8221; said Sparta Commodities analyst Neil Crosby, who added that ample crude inventories could be delaying buying. &#8220;For now, physical pricing is under pressure.&#8221;



Besides weak refining demand, supply of light, low-sulphur crudes competing with the North Sea such as West Africa or the United States has been&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL5N3GO63V&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">rising globally</a>.



Ample supply is also evident in the structure of short-term Brent swaps &#8211; when crude for prompt delivery trades at a $1.07 per barrel discount to the July contract as opposed a $1.64 premium a month ago.



The current structure is known as contango and indicates abundant prompt supplies and weak demand. The opposite structure is known as backwardation.



WEAKNESS ACROSS THE BOARD



In the United States, physical markets have also softened as U.S. refinery processing rates have stayed below regular seasonal levels despite the end of a maintenance season.



Prices for Louisiana Light Sweet crude&nbsp;WTC-LLS&nbsp;fell to a three-week low of $2.33 per barrel over WTI on May 16, according to LSEG data.



The four-week average for U.S. refinery utilization was at 88.7% for the week ended May 10, down from 91.2% over the same period a year ago, according to the U.S. Energy Information Administration.



At the same time, the four-week averages for both U.S. gasoline and distillate product-supplied, a proxy for demand, were 4-5% below 2023 levels.



Refinery profit margins around the world have weakened partly because of a global&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL4N3H64LF&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">slump in diesel</a>&nbsp;values, a key refined product for the industrial and transport sectors alike.



PVM analyst Tamas Varga said lower margins were a clear sign that refiners were producing too much fuel amid lax consumer and industrial demand.



Lower profit margins have already prompted Asian refiners to&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL1N3HH07V&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">process less crude</a>&nbsp;oil in May, with others considering more cuts in coming months, further reducing crude demand.



Asia’s oil refining curtailments &#8220;signals a weak oil market,&#8221; said U.S. oil analyst Paul Sankey.



&#8220;The last leg of the refining balance essentially is Asia. It&#8217;s the first thing that shuts down&#8221; when markets are oversupplied, he said, adding that he expects OPEC to roll over its voluntary cuts at the June 1 meeting.



Weaker Asian refining demand has caused a drop-off in Middle East crude prices with Benchmark Dubai touching a near two-month low of $81.24 a barrel on May 8.



It has also left a glut of Nigerian supply, forcing sellers to cut prices for May cargoes to clear an overhang.



Nigerian Qua Iboe&nbsp;BFO-QUA&nbsp;crude fell to $2.10 above dated Brent on May 15, the lowest premium since February according to LSEG data.



An Asian crude buyer, who asked not to be named, said he was holding off purchases of West African and WTI crude until values drop further.



&#8220;They need to find outlets. (There is) too much oil,&#8221; the buyer said.



North Sea crude under pressure&nbsp;<a href="https://reut.rs/3K8XjbS" target="_blank" rel="noreferrer noopener">https://reut.rs/3K8XjbS</a>



North Sea crude under pressure&nbsp;<a href="https://reut.rs/4boYcZY" target="_blank" rel="noreferrer noopener">https://reut.rs/4boYcZY</a>



(Reporting by Robert Harvey and Natalie Grover, additional reporting by Gary McWilliams and Liz Hampton in Houston, and Florence Tan in Singapore; Editing by Alex Lawler, Dmitry Zhdannikov and Susan Fenton)

Illustration shows miniatures of oil barrels and rising stock graph

Global oil markets weaken as sluggish demand leaves overhang

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107387754-1710442603582-Fort-Knox-Gold-Pour-820x462.jpg" alt="" class="wp-image-488636" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107387754-1710442603582-Fort-Knox-Gold-Pour-820x462.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107387754-1710442603582-Fort-Knox-Gold-Pour-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107387754-1710442603582-Fort-Knox-Gold-Pour-160x90.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107387754-1710442603582-Fort-Knox-Gold-Pour-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107387754-1710442603582-Fort-Knox-Gold-Pour.jpg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The Fort Knox Alaska operations of mining company Kinross, which has a new gold mine in Tetlin, Alaska, that has led to lawmaker concerns about trucking’s impact. Courtesy: Kinross</figcaption></figure>



May 20 (Reuters)&nbsp;&#8211;&nbsp;Gold prices hit an all-time high on Monday, as a slowing U.S. inflation trend boosted expectations the Federal Reserve could deliver its first interest rate cut soon, while silver scaled a more than 11-year peak.



Spot gold&nbsp;XAU=&nbsp;rose 1% to $2,438.44 per ounce, as of 0811 GMT, after hitting a record high of $2,449.89 earlier in the session. U.S. gold futures&nbsp;GCcv1&nbsp;rose 1.1% to $2,442.60.



Data last week showed signs of cooling inflation and traders now expect a 65% chance of a U.S. rate cut by September. FEDWATCH



The dollar index&gt;&nbsp;=USD&nbsp;remained subdued, making greenback-priced bullion more attractive to buyers holding other currencies.&nbsp;USD/



A soft U.S. dollar and expectations the Federal Reserve is expected to cut rates soon has helped gold prices, said Kyle Rodda, a financial market analyst at Capital.com.



Bullion is known as an inflation hedge, but higher rates increase the opportunity cost of holding non-yielding gold.



Minutes of the Fed&#8217;s last policy meeting due on Wednesday along with comments from a slew of Fed speakers will be on investors&#8217; radar for this week.



&#8220;Gold prices sneaked in a cheeky record high ahead of China&#8217;s (market) open on Monday. Yet as the move has not been confirmed with by a weaker U.S. dollar, it seems to have been caught in a tailwind from higher metals futures on China&#8217;s exchanges,&#8221; said City Index senior analyst Matt Simpson.&nbsp;MET/L



China, the top consumer of bullion and a majority of industrial metals, announced &#8220;historic&#8221; steps on Friday to stabilise its crisis-hit property sector.



Spot silver&nbsp;XAG=&nbsp;rose 1.3% to $31.88 after hitting an over 11-year high.



&#8220;Silver&#8217;s relative cheapness compared to gold and its strong fundamentals are invigorating investor interest. Platinum is trading at premium over palladium with rising inflows of exchange traded funds,&#8221; analysts at ANZ wrote in a note.



Platinum&nbsp;XPT=&nbsp;fell 0.2% to $1,078.88, after hitting its highest since May 12, 2023 earlier in the session. Palladium&nbsp;XPD=&nbsp;dropped 0.2% to $1,006.49.



(Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Sohini Goswami and Krishna Chandra Eluri)

107387754-1710442603582-Fort-Knox-Gold-Pour

Gold hits record peak as rate-cut bets burnish appeal, silver jumps

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="538" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/X5WBKTDO6BMH7BA5JA5G55KZ74-820x538.jpg" alt="" class="wp-image-488627" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/X5WBKTDO6BMH7BA5JA5G55KZ74-820x538.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/X5WBKTDO6BMH7BA5JA5G55KZ74-300x197.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/X5WBKTDO6BMH7BA5JA5G55KZ74-137x90.jpg 137w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/X5WBKTDO6BMH7BA5JA5G55KZ74-768x504.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/X5WBKTDO6BMH7BA5JA5G55KZ74-1536x1007.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/X5WBKTDO6BMH7BA5JA5G55KZ74-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Former South African President Jacob Zuma speaks to supporters of the uMkhonto weSizwe Party outside the High Court in Durban, South Africa, March 27, 2024. REUTERS/Rogan Ward/File Photo</figcaption></figure>



JOHANNESBURG, May 20 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s former president Jacob Zuma is barred from running for parliament in this month&#8217;s election, the country&#8217;s top court ruled on Monday, a judgment that could influence the outcome and trigger unrest from Zuma&#8217;s supporters.



The constitutional court found Zuma&#8217;s 15-month jail sentence for contempt of court in 2021 disqualified him from standing in the May 29 election, as the constitution prohibits anyone given a prison sentence of 12 months or longer from holding a parliamentary seat.



&#8220;It is declared that Mr. Zuma was convicted of an offence and sentenced to more than 12 months&#8217; imprisonment, &#8230; and is accordingly not eligible to be a member of, and not qualified to stand for election to, the National Assembly,&#8221;&nbsp;its ruling said.



Zuma, who was forced to quit as president in 2018, has fallen out with the governing African National Congress (ANC) and has been campaigning for a new party called uMkhonto we Sizwe (MK) named after the ANC&#8217;s formed armed wing.



Opinion polls suggest the ANC&#8217;s majority is at risk after 30 years in power, and MK represents a threat to it, especially in Zuma&#8217;s home province of KwaZulu-Natal where he is popular.



In 2021 Zuma&#8217;s jailing triggered riots in KwaZulu-Natal in which more than 300 people died and which morphed into a wider spate of looting.



Asked about the potential for violence in the wake of the constitutional court ruling during an interview with local radio station 702, President Cyril Ramaphosa said: &#8220;I&#8217;m not concerned about this instigating violence.&#8221;



&#8220;We have rule of law in South Africa that governs us. Once a constitutional court has decided, that is it and should there be any threat of violence our security forces are ready,&#8221; he said.



South Africa&#8217;s electoral commission originally disqualified Zuma in March, but a month later&nbsp;a court overturned the disqualification saying the relevant section of the constitution applied only to people who had a chance to appeal against their sentences, which had not been Zuma&#8217;s case.



The electoral commission&nbsp;then took the case to the&nbsp;constitutional court.&nbsp;It said previously that even if Zuma was disqualified from standing as a member of parliament, his face will still appear on ballots this month as he is the registered leader of the MK party.



An Ipsos opinion poll published in April put support for MK at roughly 8%, versus just over 40% for the ANC.



While the ANC is still on track to get the most votes, if it gets less than 50% support it would have to seek one or more coalition partners to govern the country, the first such alliance since the party swept to power under liberation hero Nelson Mandela at the end of apartheid.



At a campaign rally for his MK party on Saturday, Zuma told thousands of supporters in a stadium in South Africa&#8217;s biggest township Soweto that his party would provide free education for disadvantaged children and create jobs.



(Reporting by Anait Miridzhanian; Additional reporting by Tannur Anders; Editing by Alexander Winning and Bate Felix)

Former South African President Jacob Zuma speaks to supporters of the uMkhonto weSizwe Party outside the High Court in Durban

South Africa’s ex-leader Zuma barred from standing in election

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-2153163436-820x547.jpg" alt="" class="wp-image-488604" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-2153163436-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-2153163436-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-2153163436-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-2153163436-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-2153163436-1536x1025.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-2153163436-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">JABRAYAIL, AZERBAIJAN &#8211; MAY 19: (EDITOR’S NOTE: This Handout image was provided by a third-party organization and may not adhere to Getty Images’ editorial policy.) In this handout image supplied by the Office of the President of the Islamic Republic of Iran, Iranian President Ebrahim Raisi Meets with Azerbaijani President Ilham Aliyev as they inaugurate the Qiz Qalasi Dam, constructed on the Aras River on the joint borders between Iran and Azerbaijan, after which his helicopter has reportedly crashed near the city of Jolfa, on the border with Azerbaijan on May 19, 2024 in Jabrayil, Azerbaijan. (Photo by Office of the President of the Islamic Republic of Iran via Getty Images)</figcaption></figure>



Iranian President Ebrahim Raisi and Foreign Minister Hossein Amirabdollahian died in a helicopter crash, state media reported Monday.



“All the passengers of the helicopter carrying the Iranian president and foreign minister were martyred,” semi-official news agency Mehr News had reported earlier.



Raisi was returning after inaugurating a dam on Iran’s common border with the Azerbaijan Republic, when his helicopter crashed upon landing in northern Iran’s Varzaqan region on Sunday evening local time, according to state news agency IRNA.



Besides the president and the foreign minister, nine people died in the crash, including Governor of East Azarbaijan Malek Rahmati, semi-official Tasnim News Agency reported.



The president’s convoy included three helicopters, two of which landed safely, according to Tasnim.



Communication with Raisi’s chopper was cut off about half an hour into the flight, Iran’s Vice President for Executive Affairs Mohsen Mansouri said. Raisi was travelling to Tabriz city to launch an oil project.



Inclement weather conditions and difficult terrain had hampered search and rescue operations, Iran’s Revolutionary Guards Corps’ chief Pirhossein Koulivand, reportedly said.



Drone footage published on state media FARS News Agency showed the chopper’s wreckage on a steep hillside.



Indian Prime Minister Narendra Modi expressed condolences on social media platform X, saying Raisi’s “contribution to strengthening India-Iran bilateral relationship will always be remembered.”



Venezuela’s president Nicolás Maduro called Raisi an “extraordinary leader.”



Former Iranian foreign minister Javad Zarif also condoled the death of the president and others in the crash.



“The consequences of this are probably going to be rather contained,” Ali Ahmadi, executive fellow at the Geneva Center for Security Policy, told CNBC’s “Street Signs Asia.”



President Raisi was a fairly marginal figure in national security decision, said Ahmadi, adding that Iranian foreign policy is principally governed by the Office of the Supreme Leader and the Iranian military.



Raisi, 63, a hardline, conservative politician was elected president in 2021 after failing to get into the office in 2017. He was seen as a contender to succeed supreme leader Ayatollah Khamenei.



As president, he cracked down on dissent at home.

Helicopter Carrying Iran President Reportedly Crashes Near Azerbaijan

Iran’s President Raisi and Foreign Minister Amirabdollahian killed in helicopter crash, state media says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1166232221-820x547.jpg" alt="" class="wp-image-487665" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1166232221-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1166232221-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1166232221-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1166232221-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1166232221-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1166232221-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Fabricio Bloisi, chief executive officer of Movile Group, a unit of Napsers Ltd, poses for a photograph in Amsterdam, Netherlands, on Thursday, Aug. 29, 2019. Naspers-owned internet ventures will be carved out into a new $100 billion company called Prosus NV, which is due to list in Amsterdam on Sept. 11. Photographer: Yuriko Nakao/Bloomberg via Getty Images</figcaption></figure>



JOHANNESBURG, May 17 (Reuters) &#8211; Dutch technology investor Prosus PRX.AS and its South African parent group Naspers NPNJn.J on Friday named the head of their iFood business, Fabricio Bloisi, as their new CEO, replacing long-time boss Bob van Dijk who stepped down last September.



The companies, whose main asset is Prosus&#8217;s 26% stake in Chinese tech giant Tencent&nbsp;0700.HK, said Bloisi &#8211; currently the CEO of Latin American food delivery business iFood &#8211; would assume the role at both companies on July 1.



&#8220;He (Bloisi) has a combination of vision, deep operational experience and strong discipline. It is this skill set which the board believes make him the right person to now lead us,&#8221; Prosus and Naspers Chair Koos Bekker said in a statement.



Bloisi welcomed the opportunity to lead both companies, adding: &#8220;A company like Prosus must play an important role in identifying new technologies, such as AI, that impact the world and specifically emerging markets&#8221;.



Prosus said the group&#8217;s strategic goals remained unchanged, adding it was on track to deliver on e-commerce profitability in the second half of its 2024 financial year and continue its open-ended share repurchase programme.



Outgoing CEO Dijk oversaw Prosus&#8217;s initial public offering in 2019 and the stock&#8217;s strong performance during the COVID-19 pandemic. But its shares fell in the broadly post-pandemic correction in technology valuations, and the company has struggled to reduce its discount to Tencent.



Since Bloisi is not as experienced in international mergers and acquisitions and dealing with investors, the board appointed interim CEO Ervin Tu as president and chief investment officer, Bekker told investors on a call.



&#8220;As our new President and CIO, he will play a fundamental role in shaping the group&#8217;s future strategy, investments, and capital allocation,&#8221; Bekker added.



But Bloisi will have the final say on capital allocation, Tu told investors.



Prosus shares were down 3.10% at 1116 GMT, while Naspers&#8217; were down 3.11%.



&#8220;Whilst we think the market will take some time to get to know Bloisi and could be sceptical initially &#8230; we believe the team of Bloisi heading and Tu alongside could work well,&#8221; UBS analyst Joseph Barnet-Lamb said.



Jefferies analysts said Bloisi&#8217;s skills as an owner-operator were unlikely to be fully used at the helm of Prosus given investments in both public and private companies have their own operators.



&#8220;We would have preferred a capital allocator with a track record in either private or public market expertise at the helm of Prosus,&#8221; they said.



(Additional reporting by Radhika Anilkumar and Prerna Bedi in Bengaluru; Editing by Sherry Jacob-Phillips and Mark Potter)

Naspers Prepares to List Global Empire From Ads to Tencent

Prosus and Naspers name iFood head Bloisi as new CEO

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6-820x461.jpeg" alt="" class="wp-image-487683" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6.jpeg 1600w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Foreign trade containers are being stacked at the container yard of Qingdao Port in Qingdao, China, on May 14, 2024.  Nurphoto | Nurphoto | Getty Images</figcaption></figure>



China remains a “critical supplier” to the world and efforts for a full decoupling remain “difficult, if not impossible,” a trade report by Allianz Trade said.



Despite talk of decoupling and derisking from China, European companies remain bullish about prospects in the country — with nearly 40% of companies in Germany and Spain and more than 30% of firms in France expecting their supply chain footprint n the country to increase.



That’s according to the report which showed that only 27% of companies surveyed in the U.S. were planning to expand in China.



“European companies are clearly less worried than U.S. firms,” the report, led by Allianz Trade’s Head of Economic Research Ana Boata said.



The Allianz Trade survey polled more than 3,000 companies in China, France, Germany, Italy, Poland, Spain, the UK and the U.S. were surveyed about their outlook for global trade in 2024.&nbsp;



More than one-third of respondents plan to increase their China footprint, while only 11% said they would decrease it, the trade survey showed.&nbsp;



“China remains the world’s critical supplier, from which a full decoupling seems difficult, if not impossible,” the Allianz Trade report said. 



Meanwhile in China, companies there are growing more optimistic about exporting to other countries.



Over one in ten exporters in China — the second-largest exporter of goods to the U.S. after Mexico —projected a greater than 10% increase in exports.&nbsp;



This is higher than other countries which mostly expected a 2% to 5% increase in exports, data from the report showed.



“Chinese exporters are more optimistic than [other countries] in the survey,” said Francoise Huang, senior economist for Asia Pacific at Allianz Trade.&nbsp;



“Last year was a bad year for overall exports, we had a global trade recession. So that’s why we think respondents in our survey are particularly optimistic,” Huang told CNBC’s “Squawk Box Asia” on Thursday.



<h2 class="wp-block-heading" id="h-diversification-is-inevitable"><a></a>Diversification is inevitable</h2>



Although companies might not completely decouple supply chains from China, diversification is still on the cards.



“Companies that are looking at diversifying their supply chains are looking at the rest of Asia Pacific, with a good focus on ASEAN,” Huang told CNBC, referring to the 10-member Southeast Asian trade bloc.



The report showed that exporters may be more optimistic in 2024 but have also become more concerned about the geopolitical landscape, as well as risks related to shortages of inputs and labor and financing.



About 73% of those surveyed said risks related to politics and protectionism were their top concern. Exporters are still worried about supply chain disruptions, with “31% of respondents placing transport risks among their top three risks and 28% included the risk of input shortages,” the report said.



About 48% of U.S. exporters that manufacture in China or have suppliers there say they would consider countries in Asia-Pacific and Latin America in their diversification efforts.



“Relocating within the same region and nearshoring seem to be the preferred trends,” the report said, adding that only 5% of respondents think reshoring trends will reverse in the next two years, while almost 30% expect it to increase.&nbsp;



The Russia-Ukraine war continues to be the largest geopolitical risk companies expect to hinder supply chains, while trade wars between the U.S. and China is the biggest threat to firms with long supply chains and more than 50% of foreign production.&nbsp;

107415700-1715834412074-gettyimages-2152345990-cfoto-chinasha240514_np8N6

China is a ‘critical’ global supplier, full decoupling may be impossible, survey shows

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107411245-1715050593477-gettyimages-2149526811-INDIA_MODI-820x461.jpeg" alt="" class="wp-image-487616" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107411245-1715050593477-gettyimages-2149526811-INDIA_MODI-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107411245-1715050593477-gettyimages-2149526811-INDIA_MODI-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107411245-1715050593477-gettyimages-2149526811-INDIA_MODI-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107411245-1715050593477-gettyimages-2149526811-INDIA_MODI-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107411245-1715050593477-gettyimages-2149526811-INDIA_MODI-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107411245-1715050593477-gettyimages-2149526811-INDIA_MODI.jpeg 1600w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Narendra Modi, India’s prime minister, center, during a campaign rally in Agra, Uttar Pradesh, India, on Thursday, April 25, 2024. Modi doubled down on his attacks against the main opposition party by using language critics say sows division between the country’s Hindu majority and Muslim minority. Photographer: Prakash Singh/Bloomberg via Getty Images Bloomberg | Bloomberg | Getty Images</figcaption></figure>



A decade into power, India’s Prime Minister Narendra Modi appears set to secure a rare third term, with the general elections now underway.



Under his rule, India’s economic growth has been robust and its geopolitical standing in the world has risen.



Yet, the country has also witnessed signs of democratic backsliding which has become apparent during his leadership, observers and critics say.



“Modi has projected himself in the mould of an East Asia strongman,” Asim Ali, an independent political researcher in New Delhi, told CNBC.



He has also been called “the high priest of India — that he is above all politics,” Ali added. “This is very worrying as mixing religious nationalism with economic development” has been a “central feature” of his government.  



In its latest 2024 report, the Sweden-based V-Dem Institute said a third Modi term could worsen the political situation “given the already substantial democratic decline under Modi’s leadership and the enduring crackdown on minority rights and civil society.”



The U.S. research group Freedom House said Indian elections will be taking place in a media landscape characterized by increasing “legal attacks on critical journalists” and news outlets.



There is no question the “space for democracy between elections has shrunk” under Modi, Milan Vaishnav, South Asia director at the Carnegie Endowment for International Peace, told CNBC.



“Today, the liberal character of India’s democracy is less apparent,” he added, with “rising majoritarianism, weakening checks on executive authority and a growing intolerance for dissent.”



Last year, the government slammed a BBC documentary — which questioned Modi’s alleged role during the 2002 deadly Gujarat riots — and blocked social media platforms from sharing any clips of it.



Many Indian mainstream media, especially the Hindi-speaking outlets, have been “co-opted” to spread propaganda to deliver “the government message,” according to Ali.



India shuts down the internet more than any other country, with authorities frequently using such tactics to stem political protests and suppress criticism, rights groups say.



In a recent Newsweek interview, Modi addressed the issues and called India the “mother of democracy.”



“Our media plays an important role in this regard,” he said, dismissing claims of “diminishing media freedom” in India as “dubious.”



The prime minister’s office and the ruling Bharatiya Janata Party did not respond to CNBC’s request for comment.



<h2 class="wp-block-heading" id="h-opposition-witch-hunt"><a></a>Opposition ‘witch hunt’</h2>



Ahead of the elections, India’s main opposition — the National Congress party — accused the Modi government of freezing its bank accounts.



“This is a criminal action on the Congress party done by the prime minister and the home minister,” said Congress leader Rahul Gandhi in a fiery attack.



“It is being orchestrated to cripple us before the elections,” he claimed, adding the people were being “robbed of their constitution and democratic structure.”



The Modi administration rejected the opposition’s allegations.



Previous governments have also pursued “a witch hunt against opposition politicians,” said Chietigj Bajpaee, a senior research fellow for South Asia at&nbsp;Chatham House.&nbsp; &nbsp;



But the scale of “actions by the Modi government is what makes it more alarming,” since it has “employed key levers of power” to intimidate opponents, he added.



India’s Supreme Court recently granted an interim bail to jailed Delhi chief minister Arvind Kejriwal, a vocal political rival of Modi, who was arrested in March under a bribery case. The arrest raised eyebrows as he was the leader of India’s Aam Aadmi Party, a key player in a larger opposition alliance.



The timing was “unusual” as it came just before the elections, said Bajpaee. It appears the government doesn’t “want to leave any stone unturned” in its stated target of securing 400 seats in the Lok Sabha or lower house of parliament, he added.



<h2 class="wp-block-heading"><a></a>‘Pro-Hindu party’</h2>



In the last decade, Modi’s BJP has become emboldened in pushing its Hindu nationalist ideology, say analysts. The aim was to consolidate its support among the Hindus, who make up 80% of the country’s 1.4 billion population.



“The BJP is an avowedly pro-Hindu party,” said Vaishnav. Since coming to power in 2014, but especially post-2019, it has “sought to use law, regulation, and even civil society to promote its agenda,” he added.



In January, Modi inaugurated a controversial temple in the city of Ayodhya — at the site where an ancient mosque was demolished by a Hindu mob — fulfilling a decades-long campaign promise.



“The temple issue would matter in the Hindi-speaking belt, especially to energize the Hindu base,” said Ali, adding the government has also used “anti-Muslim” rhetoric during the election campaign.



Modi was accused of hate speech recently after he reportedly called Muslims “infiltrators” at a rally, seen as undermining India’s secular constitution.



The Modi government’s “talk of establishing a ‘Hindu Rashtra’ or Hindu nation does indicate ambitions to demolish the divide between state and religion,” noted Bajpaee, warning this could “erode India’s secular credentials.”



<h2 class="wp-block-heading"><a></a>Cult-like status?</h2>



Yet, public backlash against Modi’s hardline rule has been limited. His charisma and persona have made him incredibly popular both at home and abroad.



“There’s no one in the opposition to match that kind of popularity,” said Ronojoy Sen, senior research fellow at the Institute of South Asian Studies, in a recent CNBC interview.



Political watchers argue Modi benefitted from a cult-like status created around him — backed by the ruling party’s formidable election machinery — to build a direct connection between him and voters.



For those unhappy with the country’s direction “to vote out the BJP means they have to get rid of Modi,” said Neelanjan Sircar, a senior fellow at the Centre for Policy Research in New Delhi. That becomes “hard to do if voters identify with him.”



His populist appeal has endured despite India’s entrenched economic problems such as rising youth unemployment and growing wealth inequality.



A<a href="https://www.thehindu.com/elections/lok-sabha/pre-poll-study-2024-method-note/article68051262.ece" target="_blank" rel="noreferrer noopener"> </a>CSDS-Lokniti pre-poll survey showed Modi was way ahead in popularity with 48% of the respondents picking him as their choice for prime minister compared with his opposition rivals.



India’s economic progress was not “obviously, worse before Modi came to the scene,” noted Sircar. “During Manmohan Singh’s time, India was also growing very fast,” he added, referring to the economic reforms under the former prime minister in the 1990s.



“What has changed is the way in which everything is branded in Modi’s image.”



Even the BJP’s manifesto is called “Modi Ki Guarantee” — or Modi’s guarantee, Sircar pointed out, adding that the entire political system “is geared towards positive attribution to the top.”



<h2 class="wp-block-heading"><a></a>‘Big changes’</h2>



With election results due in early June, it has been widely expected the prime minister and the BJP will cruise to victory for a third term, given India’s feeble opposition.



A reelected Modi government will be “more forceful” in pushing ahead with “politically sensitive economic reforms and its more divisive identity-driven agenda,” said Bajpaee, from Chatham House.



In a recent Interview, Modi exuded confidence and said he wanted to make India “the third economic superpower,” outlining his bold vision.



The Indian leader will “flex his muscles” to enact significant legislation on a strengthened mandate, added Carnegie’s Vaishnav.



“Modi has already prepared the electorate to expect ‘big changes’ once they’re brought back to power,” he added.

107411245-1715050593477-gettyimages-2149526811-INDIA_MODI

Modi’s strongman rule raises questions about India’s ‘democratic decline’ as he seeks a third term

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="541" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XHKXHIOUFZIJZAGULBLYUNLOQA-1-820x541.jpg" alt="" class="wp-image-487399" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XHKXHIOUFZIJZAGULBLYUNLOQA-1-820x541.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XHKXHIOUFZIJZAGULBLYUNLOQA-1-300x198.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XHKXHIOUFZIJZAGULBLYUNLOQA-1-136x90.jpg 136w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XHKXHIOUFZIJZAGULBLYUNLOQA-1-768x507.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XHKXHIOUFZIJZAGULBLYUNLOQA-1-1536x1014.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XHKXHIOUFZIJZAGULBLYUNLOQA-1-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Workers offload boxes with Oxford/AstraZeneca vaccines as the country receives its first batch of coronavirus disease (COVID-19) vaccines under COVAX scheme, at the international airport of Abuja, Nigeria March 2, 2021. REUTERS/Abraham Archiga</figcaption></figure>



ABUJA, May 16 (Reuters)&nbsp;&#8211;&nbsp;Dubai&#8217;s Emirates airline will resume flight schedules to Nigeria from Oct. 1, it said on Thursday, ending a close to two-year halt to flights.



The United Arab Emirates (UAE) stopped issuing visas to Nigerians in 2022 after Emirates suspended flights between the nations because of an inability to repatriate funds from Nigeria.



&#8220;We are excited to resume our services to Nigeria. We thank the Nigerian government for their partnership and support in re-establishing this route and we look forward to welcoming passengers back on board,&#8221; Adnan Kazim, the airline&#8217;s deputy president and chief commercial officer, said in a statement.



The Lagos-Dubai service has been popular with Nigerian customers in the past and Emirates said it hopes to reconnect travellers to Dubai and onwards to more than 140 destination with its resumption of services.



Nigerian President Bola Ahmed Tinubu and UAE President Mohamed bin Zayed Al Nahyan met last September in Abu Dhabi and discussed the lifting of the visa ban and new investments into Africa&#8217;s most populous country.



The resumption of schedules also includes cargo flights, the statement said.



(Reporting by Ope Adetayo; Additonal reporting by Elisha Bala-Gbogbo; Editing by Jason Neely and David Goodman)

Oxford/AstraZeneca vaccines against COVID-19 arrive in Abuja

Emirates to resume Nigeria flights after nearly two years

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107414676-1715697984930-gettyimages-2152910133-wallstl424193_qvig1fef-820x462.jpeg" alt="" class="wp-image-487293" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107414676-1715697984930-gettyimages-2152910133-wallstl424193_qvig1fef-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107414676-1715697984930-gettyimages-2152910133-wallstl424193_qvig1fef-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107414676-1715697984930-gettyimages-2152910133-wallstl424193_qvig1fef-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107414676-1715697984930-gettyimages-2152910133-wallstl424193_qvig1fef-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/107414676-1715697984930-gettyimages-2152910133-wallstl424193_qvig1fef.jpeg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Traders work on the floor during morning trading at the New York Stock Exchange on May 14, 2024. Spencer Platt | Getty Images</figcaption></figure>



Traders appear increasingly confident that the U.S. Federal Reserve could start cutting interest rates as early as September, after inflation data cooled more than expected in April.



Some analysts, however, are far from convinced about the prospect of imminent rate reductions.



The consumer price index (CPI), a broad measure of how much goods and services cost at the cash register, increased 0.3% from March, the Labor Department’s Bureau of Labor Statistics reported Wednesday. That was slightly below a Dow Jones estimate of 0.4%.



The softer-than-expected data on Wednesday propelled stocks to fresh record highs and fueled speculation about how soon the Fed could be prepared to begin cutting rates.



Traders are currently pricing in a roughly 70% chance of a U.S. rate cut in September, according to the CME FedWatch Tool. That marks a sharp increase, compared to earlier in the week.



Jerome Schneider, head of short-term portfolio management at PIMCO, said on Thursday that the latest U.S. inflation data confirmed to investors that the potential for a near-term rate hike was now “off the table.”



“I think more contextually, we have to really understand that we have celebrated a lower inflation rate, the market has. But, in context, at PIMCO we’re specifically thinking about the longer-term trajectory of how the Fed is going to react to this data,” Schneider told CNBC’s “Squawk Box Europe.”



“More importantly when you look [at] … what is going on within the segments of CPI and the [Personal Consumption Expenditures Price Index], the more prevalent inflation indicator for the Federal Reserve, it still remains relatively resilient,” Schneider said.



“In fact, to get below a 3% number in those core figures, we’re going to have to see prints over the course of the remainder of the year of 0.2% or lower. Right now, we’re still well above that.”



He added that while the latest inflation data provided some relief, in the context of the Fed quickly getting back closer to its 2% target, “it is probably unlikely at this point in time.”



<h2 class="wp-block-heading" id="h-softer-data"><a></a>Softer data</h2>



Alongside the latest U.S. inflation data, the Commerce Department reported on Wednesday that retail sales were flat on the month, compared with the estimate for a 0.4% increase. The print appeared to show that consumer spending in the world’s largest economy had lost some momentum.



“If you put the inflation data with the retail sales data earlier in the week, where it was a decent miss, and really weakened discretionary areas, and that to me tells us a story about a consumer that under the hood is starting to feel the effects of these higher rates,” Jacob Mitchell, chief investment officer and founder of Antipodes Partners, told CNBC’s “Squawk Box Europe” on Thursday.



“I think probably the market is starting to see softer data coming, which will make the job of the Fed a little bit easier.”



Asked whether the CPI data suggests that the Fed is on course to cut rates in September, Mitchell replied, “Look, I would agree that you didn’t get what you needed on the key components, services and owner’s equivalent rent.”



He added, “And those two elements, look, if we don’t get much weaker goods numbers, then in the second half of the year, you get base effects coming in, so you’re going to see a natural reacceleration in core CPI.”



— CNBC’s Jeff Cox contributed to this report.

107414676-1715697984930-gettyimages-2152910133-wallstl424193_qvig1fef

U.S. inflation data fuels bets of Fed rate cuts as early as September — but analysts aren’t convinced

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="573" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/MRLWKTGVIRIYFC257KSXSP6GGA-820x573.jpg" alt="" class="wp-image-487246" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/MRLWKTGVIRIYFC257KSXSP6GGA-820x573.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/MRLWKTGVIRIYFC257KSXSP6GGA-300x210.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/MRLWKTGVIRIYFC257KSXSP6GGA-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/MRLWKTGVIRIYFC257KSXSP6GGA-768x537.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/MRLWKTGVIRIYFC257KSXSP6GGA-1536x1074.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/MRLWKTGVIRIYFC257KSXSP6GGA-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: South Africa President Cyril Ramaphosa speaks at the Congress of South African Trade Unions (COSATU) National Worker&#8217;s Day rally at Athlone Stadium in Cape Town, South Africa, May 1, 2024.?REUTERS/Esa?Alexander/File Photo</figcaption></figure>



JOHANNESBURG, May 16 (Reuters) &#8211; South Africans vote in a national election on May 29 and, for the first time since the end of apartheid 30 years ago, polls suggest the ruling African National Congress party (ANC) is at risk of losing its parliamentary majority. Investors are paying close attention.



<h2 class="wp-block-heading" id="h-why-is-nbsp-a-majority-nbsp-important">WHY IS&nbsp;A MAJORITY&nbsp;IMPORTANT?</h2>



If the ANC gets less than 50% support it would have to seek one or more coalition partners to govern Africa&#8217;s most industrialised economy. The new parliament will choose South Africa&#8217;s next president.



The new government will set fiscal and economic policy for the coming five years, and investors want to see if the next administration is likely to tack sharply left, head in a more business-friendly direction or prevail with the status quo of slow reforms.



<h2 class="wp-block-heading" id="h-what-are-investors-focused-on">WHAT ARE INVESTORS FOCUSED ON?</h2>



An April Ipsos poll put the ANC&#8217;s support at 40.2% and most surveys have estimated it will get below 45%, the level financial analysts say it needs to reach to enlist smaller, centrist coalition partners.



Otherwise, the ANC may have to seek a deal with&nbsp;the far-left Marxist Economic Freedom Fighters (EFF) or the economically liberal Democratic Alliance (DA).



&#8220;The market is watching very closely to see the degree to which the ANC&#8230; (is) forced to engage in coalitions with what are perceived to be extremely left-wing parties such as the MK (uMkhonto we Sizwe party) and EFF,&#8221; said Yvette Babb, a portfolio manager at U.S.-asset manager William Blair Investment Management.



&#8220;The greyer zone of between 45%-50%, whereby they (ANC) may need to form a coalition with smaller parties that are more centrist, is not deemed to be a bad thing&#8230;perhaps that introduces more checks and balances into the governance process.&#8221;



<h2 class="wp-block-heading" id="h-how-will-markets-react">HOW WILL MARKETS REACT?</h2>



Post-election coalition discussions between the ANC and the EFF or the recently-formed MK, led by former President Jacob Zuma, would lead to a &#8220;kneejerk&#8221; sell-off of South African assets, said Mpho Molopyane, chief economist at South African investment and insurance company Alexforbes.



&#8220;The concern is that&#8230; we could see government turning more populist, increasing social spending, implementing policies that are anti-business, the reform agenda slowing down,&#8221; she said.



Meanwhile, coalition discussions between the ANC and DA would likely lead to a &#8220;risk-on rally&#8221;, where prices rise, Molopyane said.



&#8220;A coalition with the DA is regarded as likely to be more business friendly&#8230; an efficiently run state, fiscal prudence – all of which would bode well for South Africa&#8217;s growth prospects,&#8221; she said.



<h2 class="wp-block-heading" id="h-how-might-the-election-impact-the-rand">HOW MIGHT THE ELECTION IMPACT THE RAND?</h2>



The rand has reflected South Africa&#8217;s economic woes in recent years. The currency has weakened a touch year-to-date and marked annual losses of 5% or more in the previous four years.



&#8220;Fair value&#8221; for the rand-U.S. dollar exchange rate&nbsp;ZAR=D3&nbsp;is about 18.10 rand per dollar, so with it currently trading just below 18.40 there is a relatively small election-linked risk premium, said Elna Moolman, Standard Bank&#8217;s head of South Africa macroeconomic, fixed income and currency research.



&#8220;This is&#8230; consistent with the general sense that investors now generally expect a benign election outcome (which ensures policy continuity),&#8221; she said.



Citi&#8217;s Luis Costa noted that the election risk premium had already faded in recent days and weeks.



&#8220;The more fundamental factors in ZAR have been recently supportive of economic activity such as the terms of trade dynamics and the improved domestic load-shedding (which&nbsp;however&nbsp;may not last after the polls close),&#8221; Costa said in a note to clients.



Load-shedding refers to scheduled power cuts which have hobbled the economy in recent years.



<h2 class="wp-block-heading" id="h-how-will-the-election-affect-the-economy-and-investment">HOW WILL THE ELECTION AFFECT THE ECONOMY AND INVESTMENT?</h2>



South Africa&#8217;s economy has barely grown in the last decade, crippled by the record power cuts and the degraded transport network. The economy grew just 0.6% in 2023.



&#8220;I don&#8217;t see any political party with a real plan to stimulate the economy, only promises for everyone to somehow have a job,&#8221; said independent risk consultant Marisa Lourenco, adding foreign direct investors were in wait-and-see mode.



&#8220;But as the dust settles after the election, South Africa will still remain attractive for certain industries, like gas, renewables, mining (like manganese).&#8221;



Net FDI inflows have generally been higher than pre-1994, when the ANC took power, World Bank data shows. Inflows stood at $9.19 billion in 2022 compared to some $374 million in 1994.



In contrast, foreign investors have cut holdings of stocks and bonds. Foreign ownership of domestic government bonds fell from a peak of 42.8% in 2018 to under 25% this year.



Other issues for international businesses operating in South Africa include infrastructure challenges, skilled worker shortages, the&#8217;greylisting&#8217; of South Africa financial sector over transparency concerns and delays for foreign workers getting permits, said Simone Pohl, CEO of the Southern African-German Chamber of Commerce and Industry.



&#8220;Despite those challenges, South Africa&#8217;s highly diversified economy, overall market volume, free press and its independent justice system still make it the number one investment location in Southern Africa,&#8221; she added.



($1 = 18.4528 rand)



(Reporting by Rachel Savage, additional reporting by Libby George, Editing by Olivia Kumwenda-Mtambo and Toby Chopra)

FILE PHOTO: South Africa President Cyril Ramaphosa attends the Cosatu National Worker’s Day rally at Athlone Stadium in Cape Town

What are the key issues for investors in South Africa’s 2024 election?

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="528" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ZN2RIXYPHJJ5HFHBQHPMQOWAVU-820x528.jpg" alt="" class="wp-image-487001" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ZN2RIXYPHJJ5HFHBQHPMQOWAVU-820x528.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ZN2RIXYPHJJ5HFHBQHPMQOWAVU-300x193.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ZN2RIXYPHJJ5HFHBQHPMQOWAVU-140x90.jpg 140w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ZN2RIXYPHJJ5HFHBQHPMQOWAVU-768x495.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ZN2RIXYPHJJ5HFHBQHPMQOWAVU-1536x990.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ZN2RIXYPHJJ5HFHBQHPMQOWAVU-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">South Africa&#8217;s President Cyril Ramaphosa gestures as he signs into law a national health bill that aims to provide universal coverage to South Africans, at the Union Building in Pretoria, South Africa, May 15, 2024. REUTERS/Siphiwe Sibeko</figcaption></figure>



PRETORIA, May 15 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s President Cyril Ramaphosa signed into law on Wednesday a bill that aims to provide universal health coverage, hailing it as a major step towards a more just society two weeks before an election that is expected to be fiercely competitive.



The National Health Insurance (NHI) Act takes aim at a two-tier health system, in which a publicly funded sector that serves 84% of the population is overburdened and run-down while some people have access to better treatment through private insurance.



Opponents have vowed to challenge it in court and described it is a ploy for votes &#8211; which the presidency denied &#8211; ahead of an election in which the governing African National Congress (ANC) is fighting to retain its parliamentary majority after 30 years in power.



The legislation will gradually limit the role of private insurance, create a new public fund to provide free access for South African citizens, and set the fees and prices that private doctors and healthcare suppliers can charge for NHI-funded benefits.



&#8220;The provision of healthcare in this country is fragmented, unsustainable and unacceptable,&#8221; said Ramaphosa, framing the legislation as a solution to inequalities that date back to the apartheid era.



&#8220;For those who would like to see (their) privileges continuing, sorry, you are on the wrong boat. The boat we are on is about equality,&#8221; he said at a signing ceremony at the Union Buildings, the seat of government in Pretoria.



Opponents say the plan will drain already stretched public finances, limit patient choice, undermine the quality of care and drive talented doctors out of the country.



<h2 class="wp-block-heading" id="h-legal-challenges">LEGAL CHALLENGES</h2>



Industry and political analysts have said the legislation is likely to get bogged down in lawsuits for years, with the funding model the main aspect that is disputed.



The government has said the National Treasury will determine the funding sources for NHI, which will include a mandatory pre-payment system and other forms of taxes.



Big local health insurers like Discovery&nbsp;DSYJ.J, Momentum Metropolitan Health&nbsp;MTMJ.J&nbsp;and AfroCentric&nbsp;ACTJ.J&nbsp;say they support the goal of universal health coverage but they do not agree on the proposed funding model.



&#8220;There is no funding plan yet and given the country&#8217;s constrained fiscal position, low economic growth and narrow tax base, this can only be solved in the longer term,&#8221; said Adrian Gore, group CEO of Discovery.



&#8220;We see no scenario in which there is sufficient funding for a workable and comprehensive NHI in its current form.&#8221;



The NEHAWU labour union, part of the country&#8217;s COSATU federation which is in an alliance with the ANC, urged Ramaphosa and the Treasury to put their full political weight behind the NHI to ensure it is properly resourced.



But the chief whip of the Democratic Alliance (DA), the biggest opposition party, said the Act did not address systemic issues in the healthcare system. &#8220;What this government has done is essentially it has tried to put a band aid over a gashing wound,&#8221; the DA&#8217;s Siviwe Gwarube said.



The legislation is good in principle, but will face big challenges due to South Africa&#8217;s high unemployment rate and low tax base, and citizens&#8217; mistrust of government due to repeated corruption scandals, said Sivuyisiwe Wonci, a health policy researcher at the University of Johannesburg.



She estimated it would not be implemented for five to seven years but said signing it before the election was a strategic move.



&#8220;The African National Congress has a very big role to play in convincing the people that it cares about them. And healthcare,&#8230; it speaks to the hearts of the people.&#8221;



(Reporting by Nqobile Dludla and Nellie Peyton; Additional reporting by Bhargav Acharya in Johannesburg; Editing by Alexander Winning and Emelia Sithole-Matarise)

South Africa’s Ramaphosa to signs health insurance bill into law

South Africa’s president signs major health bill just before election

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="720" height="405" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/IMG_4495.jpeg" alt="" class="wp-image-486984" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/IMG_4495.jpeg 720w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/IMG_4495-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/IMG_4495-160x90.jpeg 160w" sizes="auto, (max-width: 720px) 100vw, 720px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



Inflation eased slightly in April, providing at least a bit of relief for consumers while still holding above levels that would suggest a cut in interest rates is imminent.



The consumer price index, a broad measure of how much goods and services cost at the cash register, increased 0.3% from March, the Labor Department’s Bureau of Labor Services reported Wednesday. That was slightly below the Dow Jones estimate for 0.4%.



On a 12-month basis, however, the CPI increased 3.4%, in line with expectations.,



Excluding food and energy, the key core inflation reading came in at 0.3% monthly and 3.6% on an annual basis, both as forecast.



This is breaking news. Please check back for updates.

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UK inflation comes in hotter than expected, slashing June rate cut bets

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