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HARARE (Reuters) &#8211; Zimbabwe on Friday suspended trade on the stock exchange and mobile phone-based payments to address what President Emmerson Mnangagwa’s government called “criminality and economic sabotage”.



The decision to suspend mobile payments will hit the economy hard as more than 80% of all transactions are conducted on phones due to a shortage of banknotes, according to central bank data.&nbsp;



In a statement on Friday, government spokesman Nick Mangwana said the move, which takes immediate effect, was part of efforts to arrest the slide of the Zimbabwe dollar, which has sharply devalued since its reintroduction last year after a decade of dollarisation.



“Government is in possession of impeccable intelligence which constitutes a prima facie case whereby the phone-based mobile money systems of Zimbabwe are conspiring, with the help of the Zimbabwe Stock Exchange, either deliberately or inadvertently, in illicit activities that are sabotaging the economy,” the statement said.



The suspension of all mobile payments and the stock market was meant to allow “intrusive investigations”.



The government says mobile payment platforms were major drivers of a roaring foreign currency trade outside formal banking channels, with multiple listed stocks such as Old Mutual providing proxy exchange rates implied by their prices on foreign bourses such as the London Stock Exchange.



On Tuesday, Zimbabwe’s central bank began weekly foreign currency auctions in a bid to draw scarce foreign currency into the formal market.

Emmerson_Mnangagwa_(2019-01-15)

Zimbabwe suspends stock exchange, mobile payments over ‘economic sabotage’

Fitch Ratings-London/Hong Kong-26 June: The South African government&#8217;s intention to stabilise debt levels within four years, as set out in this week&#8217;s emergency budget, is unlikely to be achieved, Fitch Ratings says. This reflects persistent challenges in reducing expenditure, boosting growth and insulating public finances from struggling state-owned enterprises, as well as reflecting the impact of the coronavirus pandemic, which will drive a sharp rise in debt/GDP this year.



Wednesday&#8217;s emergency budget revised the consolidated budget deficit projection for the current fiscal year (FY21; ending March 2021) to 15.7% of GDP, over double the 6.8% projected in the original budget in February. The main factor is a sharp fall in tax revenues due to the economic fall-out resulting from lockdown measures, as well as the general hit to the economy and some tax relief. The government expects the main budget revenues to be ZAR300 billion &#8211; 6% of GDP &#8211; lower than previously anticipated.



South Africa has recorded 100,000 coronavirus cases and this number could rise substantially, according to government modelling. Nevertheless, the government expects non-interest expenditure to be just ZAR36 billion (0.7% of GDP) larger than projected in February, as the emergency budget plans to offset substantial additional spending on health and economic support through savings in other areas.



We view the government&#8217;s forecast of gross loan debt rising to 81.8% of GDP in FY21, much higher than the 65.6% in the original budget, as realistic. However, we believe its expectation that debt will peak at 87.4% in FY24 is optimistic. This would require sufficient fiscal consolidation to achieve a primary budget surplus in that year, which would be South Africa&#8217;s first since 2008, towards the end of the commodity boom.



The government aims to cut expenditure by ZAR230 billion over FY22 and FY23 relative to earlier plans and then implement additional cuts, complemented by small tax-raising measures. Details will be presented in the Medium-Term Budget Policy Statement in October.



Revenue projections beyond the current fiscal year appear conservative, and revenues may exceed government forecasts (the government predicts that revenues will still be ZAR202 billion below its February projections in FY23). However, Fitch believes planned expenditure cuts seem ambitious not least because they would significantly weaken the economic recovery. South Africa&#8217;s recent experience highlights the challenges of meeting fiscal targets. February&#8217;s budget abandoned the earlier target for a primary budget balance by FY23 (excluding support for state-owned electricity company Eskom).



Social and political factors, including exceptionally high inequality, powerful trade unions and deep divisions within the governing African National Congress, present significant hurdles for spending cuts. For example, the government has still not agreed the wage bill savings with public sector trade unions for FY21 that were included in the February budget. A comprehensive adjustment of the large public sector wage bill may not be possible until the current three-year agreement expires in April 2021, and negotiations then are likely to be difficult.



Key reforms to Eskom that would support the economy and reduce the burden on the public finances, and relatively minor measures to accelerate GDP growth, have also faced significant political hurdles. Although the challenges in restructuring state-owned flag carrier South African Airways, which filed for business rescue protection last December, are small from a macroeconomic standpoint, they illustrate the difficulty in addressing budget pressures from troubled state-owned enterprises in the face of trade union opposition. Our downgrade of South Africa&#8217;s Issuer Default Rating to &#8216;BB&#8217; on 3 April resulted from the lack of a clear path towards government debt stabilisation as well as the expected impact of the coronavirus pandemic-related shock on public finances and growth. The Outlook on the rating is Negative. A continued rise in government debt/GDP and failure to formulate a clear and credible path towards stabilising the government debt/GDP ratio could lead to negative rating action

SA Finance Minister Tito Mboweni delivers his emergency budget

#SpecialBudget2020: Finance Minister Tito Mboweni delivers emergency budget (full speech)

South Africa unlikely to sort out its debt in four years – Fitch.

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It seems in South Africa this Covid-19 outbreak is going to get a lot worse before it gets better. The National Institute for Communicable Diseases is projecting that South Africa could come close to 408 000 coronavirus cases by the middle of next month. Right now it has over 118 000 positive Covid-19 cases with over 2000 deaths. On Wednesday the trials began and the first person was injected with a tested vaccine at Witwatersrand University in Johannesburg. The university called for 50 volunteers and they got 300. What’s happening? Dr Anthonet Koen, Principal Investigator joins CNBC Africa for more.

Update on Africa’s COVID-19 vaccine trial

Finance Minister Tito Mboweni’s emergency budget on June 24 was meant to provide a roadmap showing how the government intends to deal with a dire fiscal situation.



Unfortunately, the speech underwhelmed on detail.



We already had a good idea of what the Treasury expects with regard to the economic and fiscal outcomes this year -due to the ‘leaks’ over the weekend- &nbsp;but what we were looking for was detail on how Mr Mboweni plans to manoeuvre the ship back on course.



The Treasury now expects GDP to contract by 7.2% this year compared with the 0.9% growth rate expected in February; the fiscal deficit is expected to reach 15.7% of GDP in FY 2020/21 compared with the 6.8% of GDP deficit projected at the start of the year; while public debt is now expected to end the fiscal year at 81.8% of GDP from 65.6% of GDP previously.



In the official budget publication, the Treasury puts forward two scenarios: active and passive. The passive scenario refers to the debt trajectory if current trends persist, while the active scenario incorporates all the intended adjustments.



The passive scenario sees public debt remaining on a strong upward trajectory, reaching 114% of GDP by 2024/25, while the active scenario sees public debt peaking at 87.4% of GDP in FY 2023/24.



Mr Mboweni noted that the government needs to find spending adjustments of about R230bn over the next two years.



Tax measures of R40bn over the next four years will also be required.&nbsp; Details with regard to these tax proposals will be given in the 2021 budget. Nothing was said about South African Airways (SAA). The Land Bank will be recapitalised with R3bn.



No further information was given with regard to the ongoing public sector wage dispute or the government’s intentions after the current bargaining round ends next fiscal year.



Mr Mboweni stated that this year, nearly half of all consolidated revenue will go towards the compensation of workers in the public sector.



On the ongoing wage dispute, the finance minister stated, “Minister Senzo Mchunu is negotiating with our partners in the labour movement to find a balanced solution that sets compensation at an appropriate, affordable and fair level. We wish him well.”



It is important to note that the R230bn in spending cutbacks required over the next few years is in addition to the R160bn cut to the public-service wage bill set out in the 2020 budget. In commenting on the latter, Mr Mboweni stated: “Failure to achieve these reductions will require larger reductions to wages and other spending areas in the outer years of the spending framework, and higher revenue increases.”



Mr Mboweni confirmed that the country would be borrowing $7bn from international finance institutions.



During his post-address media briefing, the finance minister said that South Africa would be asking the IMF to approve a $4.2bn loan in early July.



It was previously said that the country would be making use of a $1bn facility from the National Development Bank- that is, the BRICS Bank-&nbsp; meaning the balance is likely to come from the World Bank.



Approaching the IMF and World Bank for assistance will rankle many within the ruling African National Congress (ANC) and its alliance partners. Mr Mboweni found himself in the cross hairs in April when ANC Secretary General Ace Magashule and his alliance counterparts called on President Cyril Ramaphosa to reject an approach to the IMF or World Bank for assistance in the fight against Covid-19 following comments by the finance minister.



The perhaps unavoidable decision to turn to international finance institutions will no doubt expose ideological cleavages within the alliance, as Mr Mboweni, with the presumed backing of Mr Ramaphosa, may be seen to have crossed a red line.



No major intentions with regard to policy reform were mentioned. While a budget reading does not usually play host to such announcements, many hoped that the unprecedented nature of the situation would encourage bold action.



Mr Mboweni did, however, state that a firm policy basis has been laid by the Treasury’s Towards an Economic Strategy for South Africa paper, which was considered by Cabinet and accepted last year.



After conceding that progress has been slow, partly attributable to Covid-19-related delays, the finance minister stated that “we are now ready”.



Another noteworthy comment by Mr Mboweni, in referring to the policy shifts put forward by his policy document, went “One of these is to shift away from the electricity supply system that was introduced in 1923, when George V, the Queen’s grandfather, was the king of what was known as the Union of South Africa. The last few years have shown the inefficiency of this archaic system. Provisional allocations to Eskom were made on the understanding that government’s Electricity Roadmap would be implemented.&nbsp; Progress is slow.&nbsp; The principle of zero-based budgeting is that we must see demonstrable value for money: Eskom will need to show progress in meeting the milestones as laid down in the Roadmap. This is non-negotiable. Progress on the other reforms will be given in the MTBPS [Medium-term Budget Policy Statement].”



The emergency budget describes a desirable fiscal destination but does not provide a credible roadmap to get there.



Mr Mboweni used a significant proportion of the speech to give listeners an economics and history lesson on sovereign debt crises, suggesting that there are a few that still need some convincing.



Given that the current wage dispute is ongoing in the courts, it is understandable that no further details were provided on the matter.&nbsp; But given the importance of containing this spending, the lack of a medium-term plan left the speech wanting.



Furthermore, Mr Mboweni highlighted the severity of the fiscal situation by starting the speech with a striking statistic: “This year, out of every rand that we pay in tax, 21 cents goes to paying the interest on our past debts.”



This, combined with the fact that around half of all consolidated revenue will go towards the compensation of workers in the public sector, clearly shows why the country is in such a fiscal mess.



Jacques Nel &#8211; Economist

THE WEEKEND READ: Analysis– a budget long on words but short on detail.

JOHANNESBURG (Reuters) &#8211; The South African government target to stabilise its ballooning debt by 2023 will be very difficult to achieve and unlikely, ratings agency Moody’s said on Thursday.



The Treasury on Wednesday presented a supplementary budget in response to the coronavirus crisis that projected a wider budget deficit, while public debt was estimated to be more than three quarters of gross domestic product in the medium term.



“In its ‘active scenario’, the government hopes to achieve a primary surplus by fiscal 2023 that would stabilise debt,” Moody’s said in a research note on the budget.



“Given South Africa’s weak track record of fiscal consolidation in recent years and the weak medium-term economic outlook, debt stabilisation by 2023 will be very difficult to achieve.”



The economy was in recession before the COVID-19 outbreak ravaged it, and the lockdown that followed late in March has put further strain on businesses and consumers.



The Treasury projects the economy will contract 7.2% this year.

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Moody’s says South Africa unlikely to stabilise debt by 2023

ABUJA (Reuters) &#8211; Nigerian banks plan to restructure over a third of loans after running into repayment problems due to the coronavirus pandemic, a member of the central bank monetary policy committee said.



A total of 17 banks have submitted requests to restructure over 32,000 loans for businesses and individuals, representing 33% of loans, Aisha Ahmad said in a statement published on the central bank’s website late on Wednesday.



She said the majority of the loans to be restructured were within the manufacturing and general commerce sectors.



“Results from ongoing impact assessments of COVID-19 effects on impairment by banks indicate a modest impact given regulatory policy measures already implemented,” Ahmad said.



Mid tier lender FCMB said in May that it was restructuring half of its loans, mainly involving the oil and retail sectors



The central bank in March said it would allow lenders to give customers more time to repay loans and create a fund to combat the impact of the coronavirus pandemic, which triggered an oil price crash and weakened the currency.



Before the pandemic, the central bank forced banks to lend to stimulate an economy mired in low growth. But lenders wary of an increasing loan pile held back and were penalised.



Total loans grew 3 trillion naira ($8.31 billion) to 18.6 trillion naira over the last year ending in April, Ahmad said.



The oil price crash also hurt energy companies, long the most favoured sector for bank loans. In April, credit to the oil sector accounted for 26% of all corporate loans, another MPC member, Adamu Lametek, said in the statement.



($1 = 361.00 naira)



Reporting by Chijioke Ohuocha; Editing by Mark Heinrich

Central Bank of Nigeria cuts benchmark lending rate to 12.5%

Nigerian banks to restructure over a third of loans -MPC member

South African finance minister Tito Mboweni painted a bleak picture of the South African economy during his emergency budget speech and quoted the Bible in plotting the way forward for a struggling economy expected to contract by 7.2% this year.



In a 40 minute speech Mboweni outlined a package of support for some state owned enterprises warnings of a the dangers of debt and a sovereign debt crisis. He said he was going to borrow $7 billion from international lenders to try to shore up the money-starved economy.



&#8220;Enter through the narrow gate for wide is the gate and broad is the road that leads to destruction and many find it. The narrow road is the one that leads to life and few can find it,&#8221; says Mboweni quoting the gospel of Matthew in the Bible. He warned that South Africa could face the same fate as the wrecked German economy of the 1920s and Zimbabwe and Argentina in more recent years. 



Mobweni said the government&#8217;s tax target was likely to fall short by R300 billion making more borrowing inevitable and the repayments crippling with a national debt expected to top R4 trillion by the end of the year. He said for every Rand the country earned it had to spent 21 cents merely paying back debt.



The government has revised its revenue down from R1.43 trillion to R1.16 trillion as COVID-19 virtually shut down the economy for nearly three weeks.



Mboweni said the government was planning to narrow the deficit and stabilize debt at 87.4% of GDP by 2023/24. 



On the other side of the coin, Mboweni was forthcoming with taxpayers&#8217; money in giving R100 billion to the infrastructure fund and R3 billion to help restructure the struggling Land Bank.

PRETORIA, SOUTH AFRICA - MARCH 16: Finance minister, Tito Mboweni briefs the media on the details of government interventions in various sectors of the departmental portfolios on COVID-19 at DIRCO Media Centre.

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“Broad is the road that leads to destruction,” bleak words in a bleak budget from Tito Mboweni.

Tito Mboweni said his emergency budget would address debt as well as gathering money tot fight COVID-19.



&#8220;We have accumulated far too much debt.This downturn as severe as it is will make it worse. Out of every Rand we collect in tax 21 cents will go to paying debt,&#8221; says the finance minister.



&#8220;This Hippo is eating or children&#8217;s inheritence and we have to do all we can to close its mouht.&#8221; 



&#8220;We have flattened the curve and saved many lives. As a farmer will tell you when the storm is raging you have to protect you plants&#8230;.the storm shall pass,&#8221; says Mboweni.



The once mighty South African economy could contract by between 7 and 16 % this year losing more than a million jobs in the process.



&#8220;I think we can forget about growth this year and probably next year,&#8221; Isaah Mhlanga, the chief economist at Alexander Forbes, told CNBC Africa. 



Mboweni has to find at least R130 billion to shore up a gap in finance an a R500 billiion stimulus package to help the South African economy weather the COVID-19 pandemic. 



Despite huge spending gap that Mboweni has to bridge t, economist Azar Jammine reckons the finance minister won&#8217;t tinker with tax.



&#8220;My view is he probably won&#8217;t do so. The amount of additional revenue you might collect would be a drop in the ocean, if you think that increasing VAT by one per cent would merely raise R24 billion which is a minute amount compared to what is needed,&#8221; says Jammine.



South Africa has been borrowing more than a billion Rand a day to keep the economy afloat through the issue of bonds.



&#8220;The question I have is this appetite for buying debt, I think the longer the bonds are issued in these volumes the less the appetite is likely to be,&#8221; says Annabel Bishop, the chief economist at Investec.

COVID-19: “This Hippo is eating our children’s inheritance”Tito Mboweni on debt in the emergency budget

This week the finance minister Tito Mboweni tweeted the metaphor of closing a hippo’s mouth to hint how hard a job he faces closing the fiscal gap. It may be easier for Mboweni to catch a real life hippo and wrestle with it rather than to solve South Africa’s gaping debt problem – expected to rise to 80% of GDP by early next year.



On the afternoon of June 24 Mboweni will outline his emergency budget in the hope it will help South Africa ride out he COVID-19 storm and find elusive growth. South Africa’s once mighty economy is expected to contract by more than 10% this year and shed more than a million jobs. Figures out this week show unemployment in South Africa has already reached 30.1 % and youth employment has risen to 59%. Mboweni has warned that South Africa could face a sovereign debt crisis by 2024 forcing it to go cap-in-hand to the International Monetary Fund for a bailout.



Mboweni is expected to reveal a budget deficit for this year projected at close to 15% of GDP, a severe injury to government finances as the economy contracts alongside a huge collapse in tax revenue of up to R300bn.In all of this Mboweni has to decide whether to throw more scarce taxpayers money at the losing making state owned enterprises – his cabinet colleagues say he should, the finance minister feels he shouldn’t.



“SA’s debt is further estimated to rise to 90.9% by 2023 and over 100% by 2025, climbing to a massive 113.85 by 2029. SA is likely headed for further substantial credit rating downgrades from Moody’s, Fitch and S&amp;P, and likely quite rapidly, from out of the BB category into the single B category, which is just above C grade,” says Annabel Bishop, Chief Economist Investec



“There is not much wriggle room that the fiscus has left coming into 2020 and now we face this miracle budget with a shortfall in revenue,” says Nesan Nair a senior portfolio manager at Sasfin.



“But as far as investors are concerned there is not better person than Tito Mboweni to do the job.”



Nolan Wapenaar, of Anchor Capital, said he was expecting a deficit of about 14, which was a significant gap to be financed.



“The country is selling bonds to the tune of a billion Rand a day. We need to get into financial shape and get out of the dire financial shape we are in,” he says.



Bernard Sacks, a senior tax partner at Mazars, believes that cutting corporate tax could help get the economy back into shape.



“In world terms we are not competitive at 28 %; we need to be at 20 % to attract foreign investment. That level of tax would see money come in and South Africans trained and put to work…I don’t think we will see the minister raise tax rates which is just as well because most companies are punch drunk right now,” says Sacks.

COMMENT: Why it may be easier for Tito Mboweni to wrestle a hippo rather than close its mouth.

Ada Osakwe, is an award-winning food entrepreneur, investor and passionate African development advocate. She is the Founder of Agrolay Ventures, an investment firm focusing on early-stage innovative food companies in Africa. Since 2015, the firm has built a portfolio of 10 high-growth investments in food and technology, including The Nuli Juice Company, Nigeria’s fastest-growing farm-to-table beverage producer and a restaurant chain. She has an MBA from the Kellogg School of Management, Northwestern University, MSc in Economics and Finance from University of Warwick, U.K. and BSc in Economics (First Class Honours) from the University of Hull, U.K.



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On June 19, Osakwe addressed the Kellogg School of Management Class of 2020. She is the first African to be given this&nbsp; honour and fourth black woman; following in the footsteps of outstanding Black-Americans: Edith Cooper;- Global Head of Human Capital at Goldman Sachs in 2017; Roslyn Brock, Chairman Emeritus of the NAACP in 2012 and media titan Oprah Winfrey, in 2011.



“I was incredibly honoured that not even up to a decade after graduating from Kellogg where I earned my MBA, I was invited to address the class of 2020.”, said Ada. “As a young woman who has worked hard to promote Africa in all I do, this meant a lot to me. I was sad when due to COVID-19, I was unable to join them in person. But by God’s grace, we will do so next year”.



With a critical phase of their lives upended by the pandemic, the class of 2020 completed the last few months of their MBA degree Program virtually, rather than in the classroom, and they will receive their diplomas in the mail or on their phones. Recognizing the need to offer extra inspiration at this extraordinary moment in history, in her commencement speech, Osakwe praised them for their bravery, resilience and courage as she told of her career through business school and a private equity company in New York on her way to becoming an entrepreneur.



“After my time in New York, I went into public service, joining the Nigerian Minister of Agriculture as his Senior Investment Advisor. This high-level role gave me unparalleled exposure at the highest levels. After four years, I gave up all the power and influence that came with my position, deciding to become an entrepreneur instead. Friends disappeared overnight, and my phone wasn’t ringing anymore. It was a difficult time as I felt I had to prove my professional capabilities to people all over again and rebuild my entire private-sector career from scratch. Thinking back, it was just what was needed to motivate me to make sure my start-up,&nbsp; Nuli,&nbsp; became the fastest-growing beverage brand and fast-casual restaurant chain in Nigeria,” she said.



“So, in your quest to thrive, there will be curve-balls thrown your way and you’ll have to take risks, it’s a given. But you’ve just got to trust your journey,” she advised the graduating students.&nbsp;



Furthermore, she stressed the importance of&nbsp; finding your voice in troubled times.



“Globally, we are at a tipping point, as we see various forms of injustice being revealed. And so now, more than ever, the world needs brave leaders like you, and me, and all other Kellogg grads around the world, to provide solutions to the existential problems being faced by humanity. And so it’s so important to find your voice and help others find theirs too, during these extraordinary times.”



This message was important to Osakwe. She has been very outspoken about the Nigerian Government’s poor response to calls for support for small business owners in Nigeria through the COVID-19 pandemic.



“Small businesses, like mine, a group that makes up over 80 percent of the labour force of my country, have been left alone to navigate these shaky waters,” Osakwe, the chair of the &nbsp;Small Business Networking Nigeria, a new organization founded by small business owners to represent their collective voices and interests on issues around policy and business environment.



“So for the amazing women among you, let your brilliance and awesomeness shine through as you keep amplifying your voices. As a young woman, throughout my life, I have suffered all forms of biases and discriminatory practices in the workplace and society. But this has never stopped me from forging my own path to greatness. And so go ahead and crash through that ceiling, tear down those walls, and create your nice, comfortable seat on multiple tables.”



As a Black-African, in her speech, Osakwe said she will always speak out against racial injustice and urged the non-blacks to also find their voices on this issue as allies to ensure there is more equality, tolerance and acceptance for all.



“I truly believe crises have the ability to bring out the best in humanity. Class of 2020, you have a front-row seat in this journey to shape the world we want to see; a better world.”

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The entrepreneur who feels Nigeria has left small business to navigate COVID-19 alone.

Wirecard ex-boss Braun arrested as creditors hunt lost billions &#8211; Reuters



Markus Braun turned himself in to prosecutors in Munich on Monday after travelling from Vienna. A judge was due to rule later on whether to keep the 50-year-old Austrian in investigative custody or grant him bail.



In his 18 years in charge Braun transformed an offshoot of the dot.com boom, known for handling payments for online gambling and adult entertainment sites, into a $20 billion-plus ‘fintech’ that won a place in Germany’s blue-chip DAX index.



The former consultant traded in a suit for a black roll-neck and portrayed himself as a tech visionary, telling investors in New York last autumn that Wirecard would increase revenues by six times by 2025 as digital payments boom.



Wirecard’s meteoric rise was, however, accompanied by repeated allegations from whistleblowers, journalists and speculators that its revenue and profits had been pumped up through fake transactions with obscure partners.



The Munich prosecutor’s office said on Tuesday that Braun now stands accused of misrepresenting Wirecard’s accounts and of market manipulation by falsifying income from transactions with so-called third-party acquirers.



Braun, whose lawyer was not available for comment, said last week in a video statement that Wirecard may have been the victim of fraud, without giving details.



Two people familiar with the matter said state prosecutors were also considering issuing an arrest warrant for Jan Marsalek, a board member who was fired on Monday. A lawyer for Marsalek was not available for comment.



Wirecard’s implosion was described on Monday as a “total disaster” by Germany’s financial regulator, who has come under fire for pursuing its critics and not the company.



<h3 class="wp-block-heading">AUDITS</h3>



An external audit by KPMG in April had failed to verify cash balances, questioned Wirecard’s acquisition accounting and was unable to trace millions in reported cash advances to merchants.



Braun, who said at the time that the allegations were not confirmed “in every point”, quit last week after in-house auditor EY refused to sign Wirecard’s 2019 accounts.



Wirecard’s shares have since shed more than 80% and its only listed bond is trading at 25 cents on the euro, indicating that investors expect to lose most of their money.



New CEO James Freis, a former financial investigator at the U.S. Treasury and compliance chief at the Frankfurt Stock Exchange, has opened urgent talks with some 15 banks that have lent 1.75 billion euros to Wirecard.



With Wirecard having failed to file audited financials, the banking consortium led by Germany’s Commerzbank (<a href="https://www.reuters.com/companies/CBKG.DE">CBKG.DE</a>) could call in the loans at any time.



Sources close to the talks said it was doubtful that Wirecard can continue as a going concern, while risks of litigation ruled out asset sales for now.



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The main question is whether to allow the firm to keep operating for a couple of weeks, to give more time to allow for a higher recovery, one source familiar with the talks said.



More than 5,000 staff are due to be paid at the end of June, and bankers would decide before then whether to pull the plug and trigger insolvency, the source added.



Wirecard is being advised by investment bank Houlihan Lokey and the creditors by law firm Allen &amp; Overy. Both declined comment.



Writing by Douglas Busvine; Editing by Alexander Smith

COVID-19: Investing for Roubini’s Greater Depression

Wirecard ex-boss Braun arrested as creditors hunt lost billions

GENEVA/ZURICH (Reuters) &#8211; Coronavirus cases are soaring in several major countries at the same time, with “worrying increases” in Latin America, especially Brazil, the World Health Organization (WHO) said on Monday.



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FILE PHOTO: Nurse Jaqueline Borges Dias prepares medications for a patient suffering from the coronavirus disease (COVID-19) at the Intensive Care Unit (ICU) of Emilio Ribas Institute in Sao Paulo, Brazil, June 17, 2020. REUTERS/Amanda Perobelli/File Photo



The world recorded more than 183,000 new coronavirus cases on Sunday, the most in a single day since the outbreak started in December, WHO chief Tedros Adhanom Ghebreyesus said.



“Certainly the numbers are increasing because the epidemic is developing in a number of populous countries at the same time and across the whole world,” WHO’s top emergencies expert, Mike Ryan, told an online briefing.



“Some of that increase may be attributed to increased testing &#8230; And certainly countries like India are testing more. But we do not believe that this is a testing phenomenon.”



Global cases surpassed 9 million on Monday, with the United States, China and other hard-hit countries also reporting new outbreaks, according to a Reuters tally.



Ryan said there had been a jump in cases in Chile, Argentina, Colombia, Panama, Bolivia and Guatemala, as well as Brazil, which had passed the 1 million mark &#8211; second only to the United States &#8211; and reported a record 54,000 cases in the previous 24 hours.



He said some of the jump in Brazil might reflect changes in the reporting system, but added:



“There still are relatively low tests per population, and the positivity rates for testing are still quite high overall. From that perspective, we would say that this trend is not reflective of exhaustive testing, but probably under-estimating the actual number of cases.”



<h3 class="wp-block-heading">1,000 DEATHS A DAY</h3>



Latin America’s largest country has frequently recorded more than 1,000 deaths a day over the last month.



President Jair Bolsonaro, sometimes called the “Tropical Trump”, has been widely criticised for his handling of the crisis. The country still has no permanent health minister after losing two since April, following clashes with the president.



Bolsonaro has shunned social distancing, calling it a job-killing measure more dangerous than the virus itself. He has also promoted two anti-malarial drugs &#8211; chloroquine and hydroxychloroquine &#8211; as remedies, despite a lack of evidence that they work.



Ryan said he thought there had been “great upticks” in cases in a number of U.S. states.



“I’m not 100 percent sure about the age profile, but I’ve seen the reports that some of this is amongst younger people. That may reflect the fact that younger people are more mobile and they are getting out and taking advantage of the reductions in restrictions of movement &#8230;



“What is clear is that the increase is not entirely explained through just increased testing.”



The WHO also said it was worried about Germany, where the reproduction rate of the virus hit 2.88 on Sunday, well above the maximum level of one transmission per person needed to contain the disease over the longer term.



<figure class="wp-block-image"><img decoding="async" src="https://s3.reutersmedia.net/resources/r/?m=02&amp;d=20200622&amp;t=2&amp;i=1523106383&amp;r=LYNXMPEG5L1OQ" alt=""/></figure>



FILE PHOTO: Mike Ryan, Executive Director of the World Health Organisation (WHO), attends a news conference at the United Nations in Geneva, Switzerland May 3, 2019. REUTERS/Denis Balibouse/File Photo



Tedros said a lack of global leadership and unity in fighting the virus was a bigger threat than the outbreak itself, and that politicisation had made the pandemic worse.



The WHO has been criticised by some member states, especially the United States, which says it was too weak, too slow and too “China-centric” in tackling the disease at the outset.

Clarification on COVID-19 “hotspots” as SA moves to level 3 lockdown

Coronavirus cases soar in big countries, especially Brazil, WHO says – Reuters

SAN FRANCISCO (Reuters) &#8211; Apple Inc (<a href="https://www.reuters.com/companies/AAPL.O">AAPL.O</a>) on Monday said it will switch to its own chips for its Mac computers, saying the first machines will ship this year and ending a nearly 15-year reliance on Intel Corp to supply processors for its flagship laptops and desktop.







Apple Chief Executive Tim Cook said it marked the beginning of a major new era for a product line powered the company’s rise in the 1980s and its resurgence in the late 1990s.



“Silicon is at the heart of our hardware,” Cook said during a virtual keynote address recorded at the company’s Cupertino, California headquarters for its annual developer conference. “Having a world class silicon design team is a game changer.”



The silicon switch brings the Mac into line with the company’s iPhone and iPads, which already use Apple-designed chips. Cook said that Apple expects the Mac transition to take about two years and that Apple still has some Intel-based computers in its pipeline that it will support for “many years.”



But the move will give software developers for Apple’s largest pool of third-party apps &#8211; those built for iPhones and iPads &#8211; new access to its laptops and desktop for the first time. Apple software chief Craig Federighi said that for those offerings, “most apps will just work, with no changes from the developer” on the new Macs. He also said the “vast majority” of existing apps for Intel-based machines can be modified to work in “just a few days.”



The news came at Apple’s Worldwide Developer Conference. The conference has gained new prominence since paid services sold through the App Store have become central to the company’s revenue growth as consumers have slowed the growth of iPhone upgrades. Apple takes a 15% to 30% cut of the sales developers make through the App Store, which is the only way to distribute software onto Apple’s mobile devices.



Those fees, and Apple’s strict app review process, have come under antitrust scrutiny in the United States and Europe, where regulators last week unveiled a formal probe into the company. In what appeared to be an acknowledgement of its some of its critics, Apple said it would let users select non-Apple apps as default apps for tasks like email and web browsing on iPhones and iPads.



But developers still gravitate toward Apple’s platform because it is lucrative, with a user base that is willing to spend money on paid apps. The annual developer conference, being held online this year for the first time because of the novel coronavirus, is where Apple often announces access to new hardware capabilities, such as special tools for artificial intelligence and augmented reality.



At the event, Apple announced a new system that lets users share digital car keys with friends and family members via the company’s iMessage system, will work with BMW (<a href="https://www.reuters.com/companies/BMWG.DE">BMWG.DE</a>) 5 Series vehicles.



The system will work with phones running the current iOS 13 operating system so that owners can start using it when BMW vehicles arrive. Apple said more cars that work with the system will come to market next year.



Apple also updated its mapping application with information about electric vehicle charging stations, working with BMW and Ford Motor Co (<a href="https://www.reuters.com/companies/F.N">F.N</a>) to show stations compatible with the user’s vehicle.



Apple also added new privacy protections, saying it would let users only share their approximate location with app developers and that it would require those developers to seek permission before sharing user data with other apps and websites. Apple also said it would require a privacy and security label, akin to a food nutrition label, to be shown to users before they download apps.

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Apple switches to its own chips for Mac computers as it adds features, privacy controls – Reuters

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NEW YORK (Reuters) &#8211; Wall Street’s three major indexes gained ground on Monday with the biggest boost from technology stocks as investors appeared to look past the potential economic impact of rising coronavirus cases in the United States and other major economies.



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FILE PHOTO: Traders exit the 11 Wall St. door of the New York Stock Exchange (NYSE) in New York City, New York, U.S., June 11, 2020. REUTERS/Brendan McDermid



The World Health Organization reported a record rise in global coronavirus cases on Sunday, driving demand for perceived safe havens including gold and longer-term U.S. Treasuries. [US/][GOL/]



While New York City on Monday celebrated the lifting of many coronavirus restrictions, a dozen states in the U.S. South and Southwest reported record increases in new cases with 10% to 20% of people testing positive in some.



However White House economic adviser Larry Kudlow told CNBC earlier in the day that there was no second wave of the pandemic and that it is unlikely there will be widespread shutdowns across the country.



Investors were also looking past the current quarter and into 2021, when earnings are expected to start improving according to Sam Stovall, chief investment strategist at CFRA.



Analysts expect a 42.7% drop in earnings per share for the second quarter, according to estimates gathered by Refinitiv.



“It can’t get much worse than this. People are hoping that and concluding that you can’t injure yourself by falling out of a basement window,” said Stovall.



But he asked, “How can you really get optimistic about what you don’t know? &#8230; Wall Street looks to the other side of the valley but we still don’t know how low or wide the valley is.”



At 2:18 p.m. ET, the Dow Jones Industrial Average rose 72.31 points, or 0.28%, to 25,943.77, the S&amp;P 500 gained 12.51 points, or 0.40%, to 3,110.25 and the Nasdaq Composite added 80.83 points, or 0.81%, to 10,026.96.



Of the S&amp;P’s 11 major sectors, technology was leading with a 1.6% gain. However the next biggest gainer was the defensive utilities sector, up 1.3%, suggesting that investors were not throwing all caution to the wind.



The market took a step back on Friday after Apple Inc’s move to temporarily shut some U.S. stores again underscored concerns of a delay in the recovery.



But Apple shares were up more than 2% on Monday and trading at record highs as the company announced new products at its annual conference for software developers.



Travel-related stocks were some of the weakest as investors in those companies have been hit hard in the past by the virus lockdowns.



The S&amp;P 1500 airlines index dropped 0.7%, while shares of cruise operators Norwegian Cruise Line and Royal Caribbean Cruises both tumbled about 7%.



The S&amp;P 500 has climbed some 42% from its March lows and the Nasdaq hit a record high earlier this month thanks to trillions of dollars in monetary and fiscal support, the reopening of businesses and improving economic data.



The S&amp;P 500 was last about 8% off its Feb. 19 record high.



U.S.-based meat processor Tyson Inc slipped 2.8% as China’s customs authority suspended imports of poultry products from a plant owned by the company that had been hit by the coronavirus.



American Airlines Group Inc fell 7% as it planned to secure $3.5 billion in new financing by selling shares and convertible senior notes to boost liquidity.Virgin Galactic Holdings Inc soared 12.5% as it signed up with NASA to develop a program to promote private missions to the International Space Station.



Declining issues outnumbered advancing ones on the NYSE by a 1.06-to-1 ratio; on Nasdaq, a 1.04-to-1 ratio favored advancers.



The S&amp;P 500 posted 12 new 52-week highs and no new lows; the Nasdaq Composite recorded 110 new highs and seven new lows.

Wall Street rises as investors look beyond rising virus cases – Reuters

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JOHANNESBURG (Reuters) &#8211; A court application brought by a group of creditors of South African retailer Edcon to stop the adoption of a proposed restructuring plan for the company has been rejected by the court as non-admissible, the administrators said on Monday.



The decision paves the way for the administrators to finalise the sales process for Edcon by the end of June to allow time for supplier negotiations to be concluded and for summer stock to be purchased.



The planned Monday afternoon meeting to consider the plan is going ahead according to schedule, the administrators said in a notice to affected parties. The meeting is still in session.



Edcon, which owns department store chain Edgars and budget retailer Jet, entered a form of bankruptcy protection in April after sales were hit after the coronavirus lockdown.



Edcon, which opened its first Edgars store in Johannesburg in 1929, had already been struggling due to falling local demand and slow economic growth in South Africa.



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Administrators in charge of Edcon are proposing a sale of parts or all of the company and about 15 parties have shown interest in the sale.



The creditor group &#8211; Durban-based Kingsgate Clothing and Clematis Trading &#8211; filed the application with a high court in Pretoria on Friday, documents on Edcon’s administrators’ website showed.



In the application, the creditors said Kingsgate and its associate companies were owed 24 million rand, and Clematis about 18.5 million rand.



Kingsgate CEO Yusuf Vahed said in the application that between May 18 and June 8, when the restructuring plan was published, Clematis CEO was advised by Edcon that they could anticipate a potential liquidation dividend of about 50 cents for every one rand owed if the rescue plan was adopted.









Vahed said this would mean Kingsgate and its associated companies, would recover only about 960,000 rand, and if this was the case, it would be keen to convert its debt into equity.



The total amount owed to Edcon’s creditors is approximately 8.1 billion rand ($466 million), the documents published on the administrator’s website said.

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Edcon creditors’ bid to halt restructuring meeting rejected by court – Reuters

South Africa to oppose Airlink&#8217;s bid to halt SAA creditors meeting &#8211; Reuters



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JOHANNESBURG (Reuters) &#8211; South Africa plans to oppose an application by regional airline Airlink to put South African Airways (SAA) into provisional liquidation and prevent a meeting of SAA’s creditors to discuss a restructuring plan, the government said on Monday.



<figure class="wp-block-image"><img decoding="async" src="https://s3.reutersmedia.net/resources/r/?m=02&amp;d=20200622&amp;t=2&amp;i=1523088673&amp;r=LYNXMPEG5L1FO&amp;w=1280" alt=""/></figure>



FILE PHOTO: A South African Airways (SAA) plane is towed at O.R. Tambo International Airport in Johannesburg, South Africa, January 18, 2020. Picture taken January 18, 2020. REUTERS/Rogan Ward/File Photo



Airlink was a franchisee of state-owned SAA for over two decades, an arrangement that allowed SAA to sell tickets and fly passengers on Airlink flights. SAA still owes some fees to Airlink, making the latter an unsecured creditor.



SAA went into a form of bankruptcy protection in December and since then state-appointed administrators have been trying to see what they can salvage.



SAA’s creditors were due to meet on Thursday this week to consider a proposed business rescue plan for the airline.



The restructuring plan, which would involve laying off about 90% of staff, leaving just 1,000 jobs, will cost at least 10 billion rand ($575.5 million). That is on top of the 20 billion rand that has been spent keeping the airline afloat over the past three years.



But the Department of Public Enterprises said on Monday it had been notified of a court application by Airlink to stop the meeting taking place and that unions had separately taken action to stop the meeting.



The proposed SAA business rescue plan prejudices concurrent creditors (unsecured creditors) of the company including Airlink, the private carrier said in a statement on Monday.



The plan benefits the government which will “own an unencumbered business, funded by concurrent creditors, but still commercially insolvent”, Airlink added.



The ministry said it would approach the court to oppose Airlink’s application that SAA be placed under provisional liquidation.



“It is disturbing that a competitor of SAA, which is 100% privately owned, as well as two labour unions, who should be acting in the best interest of their members, are seeking to destroy SAA by forcing a liquidation through the courts,” the Department of Public Enterprises said.



In response, Airlink said it was not a competitor of SAA and had been a franchisee of the airline for 23 years.



Airlink terminated the franchise agreement earlier this year when SAA failed to pay over 700 million rand of revenue for tickets issued on flights flown by the private airline.

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Who Regulates What’s Posted Online?

Zimbabwe suspends stock exchange, mobile payments over ‘economic sabotage’

South Africa unlikely to sort out its debt in four years – Fitch.

Update on Africa’s COVID-19 vaccine trial

THE WEEKEND READ: Analysis– a budget long on words but short on detail.

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Wall Street rises as investors look beyond rising virus cases – Reuters

Edcon creditors’ bid to halt restructuring meeting rejected by court – Reuters

South Africa to oppose Airlink’s bid to halt SAA creditors meeting

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