1 India opens up on FDI (Khaleej Times) India has announced
sweeping reforms to rules on foreign direct investment, opening up its defence
and civil aviation sectors to complete outside ownership and clearing the way
for Apple to open stores in the country.
The move comes two days after central bank governor
Raghuram Rajan, a darling of financial markets but under pressure from
political opponents at home, announced he would not seek another term, a
surprise move that raised concerns about whether reforms he set in motion will
stall.
Prime Minister Narendra Modi hailed the changes to
the foreign direct investment rules, stressing his government's reform
credentials. In a tweet, he said the changes would provide a "major
impetus to employment and job creation in India."
The new reform measures also relax restrictions on
inbound investments in pharmaceuticals and single-brand retail. Defence
contractors that have been reluctant to transfer technology to manufacture
equipment in India would get the right to own local operations outright, with
government approval, up from a cap of 49 per cent previously.
In other changes, India allowed 100 per cent FDI in
civil aviation, following on from last week's launch of a new policy that
lowered barriers to entry for airlines that want to fly international routes. The
government also allowed foreign companies to own up to 74 percent in
'brownfield' pharmaceuticals projects without prior government approval. India
already allows 100 percent ownership of greenfield pharma businesses.
2 Nigeria currency plummets on floatation (San
Francisco Chronicle) Nigeria's currency plummeted on Monday, losing more than
40 percent of its value as the government floated the naira for the first time
in the history of the oil-producing nation.
The move was forced by a spiraling economic crisis
and massive shortage of foreign exchange created by slumping oil prices and
aggravated by President Muhammadu Buhari's 16-month-long insistence that the
Central Bank defend the naira at a fixed rate of 197 to the dollar. Other oil producers
like Angola and Venezuela devalued months ago.
The naira started Monday at 255 to the dollar but
ended with $530 million being traded at 280 to the dollar among 21 banks,
according to traders who insisted on anonymity because the Central Bank has not
published the figures.
"This is good news for the majority of
Nigerians," Ayo Teriba, CEO of Economic Associates consultancy, said of
the devaluation. "The biggest gain is on the appreciation of the parallel
market because the parallel market devaluation has destroyed domestic
activities, with prices of local goods skyrocketing." Imported goods also
have doubled and trebled in price.
Inflation is soaring at nearly 16 percent this
month, and analysts say it will get worse before it slows down. The devaluation
is a boon for MTN, Africa's largest telecommunications company, which this
month negotiated a deal to pay a fine of 330 billion naira, now effectively
discounted by about 30 percent.
Among losers are companies with billions of naira
trapped in Nigeria that they were not allowed to repatriate. Analysts said the
devaluation could exacerbate bad debts already standing at 10 percent of bank
loans. Bankers will adjust loans made in dollars to the new value of the naira,
including more than $10 billion loaned to Nigerian companies to buy assets from
oil multinationals in recent years.
3 China plans to halve meat consumption (Oliver
Milman in The Guardian) The Chinese government has outlined a plan to reduce
its citizens’ meat consumption by 50%, in a move that climate campaigners hope
will provide major heft in the effort to avoid runaway global warming.
New dietary guidelines drawn up by China’s health
ministry recommend that the nation’s 1.3 billion population should consume
between 40g to 75g of meat per person each day. The measures, released once
every 10 years, are designed to improve public health but could also provide a
significant cut to greenhouse gas emissions.
Should the new guidelines be followed, carbon
dioxide equivalent emissions from China’s livestock industry would be reduced
by 1bn tonnes by 2030, from a projected 1.8bn tonnes in that year.
Globally, 14.5% of planet-warming emissions emanate
from the keeping and eating of cows, chickens, pigs and other animals – more
than the emissions from the entire transport sector. Livestock emit methane, a
highly potent greenhouse gas, while land clearing and fertilizers release large
quantities of carbon.
Meat has gone from rare treat to a regular staple for
many Chinese people. In 1982, the average Chinese person ate just 13kg of meat
a year and beef was nicknamed “millionaire’s meat” due to its scarcity.
The emergence of China as a global economic power
has radically altered the diets of a newly wealthy population. The average
Chinese person now eats 63kg of meat a year, with a further 30kg of meat per
person expected to be added by 2030 if nothing is done to disrupt this trend.
The new guidelines would reduce this to 14kg to 27kg a year.
China now consumes 28% of the world’s meat,
including half of its pork. However, China still lags behind more than a dozen
other countries in per capita meat consumption, with the average American or
Australian consuming twice as much meat per person compared to China.
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