Items filtered by date: Monday, 13 November 2017

Moody's Investors Service (Moody's) has downgraded to B2 from B1 the long-term local currency deposit and issuer ratings of four Nigerian banks -- Access Bank Plc (Access), Guaranty Trust Bank Plc (GTBank), United Bank for Africa Plc (UBA) and Zenith Bank Plc (Zenith) and the long-term local and foreign currency issuer ratings of Bank of Industry, a Nigerian development bank.

Moody's also downgraded to B3 from B2 the long-term foreign currency deposit ratings of Access, GTBank, UBA and Zenith, as well as those of Union Bank of Nigeria plc (Union), First Bank of Nigeria Limited (FBN) and Sterling Bank Plc (Sterling). Concurrently, Moody's downgraded the baseline credit assessments (BCAs) of Zenith and GTBank to b2 from b1.

The rating action follows Moody's downgrade of Nigeria's government bond ratings to B2, with a stable outlook, from B1, with stable outlook, on 7 November 2017 

RATINGS RATIONALE

IMPACT OF GOVERNMENT SUPPORT ON BANKS' LOCAL CURRENCY DEPOSIT RATINGS

The primary driver of today's rating action is the weaker capacity of the government to provide support to banks, in case of stress, as reflected in the downgrade of the sovereign issuer rating to B2 from B1. Subsequently, Access' and UBA's long-term local currency deposit ratings and Bank of Industry's long-term issuer ratings no longer benefit from a one-notch uplift from their b2 BCAs (or standalone credit profile, as is the case for Bank of Industry) as these are now at the same level as the government bond rating. The long-term local currency deposit ratings of Sterling, Union and FBN have been affirmed at B2, as their b3 BCAs continue benefiting from one notch of government support uplift.

WEAKER CREDIT PROFILE OF THE NIGERIAN GOVERNMENT EXERTS PRESSURE ON BANKS

The secondary driver of today's rating action is the Nigerian banks' significant holdings of government securities, which generally exceed 100% of their core capital, linking their credit profile to that of the government. In view of the correlation between sovereign and bank credit risk, the banks' standalone credit profiles and ratings are constrained by the rating of the government. As a result, the BCAs for Zenith and GTBank have been downgraded to b2 from b1, in line with the downgrade of the government issuer rating, despite the resilient financial performance witnessed by both banks over the last 24 months. The BCAs of the other rated Nigerian banks have been affirmed as they already capture risks emanating from their sovereign exposures.

INDIVIDUAL BANKS' MAIN RATING DRIVERS

Union Bank of Nigeria plc

Moody's affirmed Union Bank's BCA and adjusted BCA at b3, long-term local currency deposit rating at B2, local and foreign currency issuer ratings at B2 and global scale short-term deposit and issuer ratings at Not-Prime. Concurrently, Moody's has downgraded Union's long term foreign currency deposit rating to B3 from B2, the long-term Counterparty Risk Assessment (CR Assessment) to B2(cr) from B1(cr), long term local currency national scale deposit ratings to A2.ng from Aa3.ng and foreign currency national scale deposit ratings to A3.ng/NG-2 from A1.ng/NG-1. The outlook on all long-term deposit and issuer ratings remains stable.

The affirmations reflect

  1. Moody's expectation of robust levels of tangible common equity over the next 12 to 18 months, following recent completion of a rights issue and 
  2. a stable deposit-based funding structure and moderate local currency liquidity buffers. These strengths are balanced against 
  3. elevated credit risks on the back of single-name and sector concentration risks and 
  4. relatively modest profitability levels versus larger local peers. The local currency deposit and issuer ratings also continue to incorporate one notch uplift from the bank's b3 BCA based on our assessment of a high probability of government support in case of need.

The decision to downgrade the long term foreign currency deposit rating to B3 and the foreign currency national scale ratings to A3.ng/NG-2, follows the downgrade of the relevant country ceiling, which captures foreign currency and convertibility risks. Similarly, the downgrade of the bank's long-term CR Assessment reflects the government's reduced capacity to provide support in case of need. As a result, the CR Assessment, which is positioned one notch above the adjusted BCA of b3, reflecting Moody's view that its probability of default is lower than that of deposits, no longer benefits from government support uplift. The downgrade of the local currency deposit national scale rating (NSR) is a result of the repositioning of our relative ranking of Nigerian banks within our NSR map following the downgrade of the corresponding local currency deposit global scale rating.

First Bank of Nigeria Limited

Moody's affirmed FBN's BCA and adjusted BCA at b3, long-term local currency deposit rating at B2, local and foreign currency issuer ratings at B2, short-term global scale deposit and issuer ratings at Not-Prime, and local currency national scale ratings at A2.ng/NG-1. Concurrently, Moody's has downgraded the bank's long term foreign currency deposit rating to B3 from B2, foreign currency national scale ratings to A3.ng/NG-2 from A2.ng/NG-1, and long-term CR Assessment to B2(cr) from B1(cr). The outlook on the deposit and issuer ratings remains negative.

The affirmations reflect 

  1. FBN's still weak asset risk metrics, with non-performing loans (NPLs) estimated at over 20% of gross loans as of June 2017, albeit on a declining trend, 
  2. still tight - although improving - foreign currency liquidity, counterbalanced by 
  3. the bank's resilient pre-provision profitability -- with FBN's pre-provision profits at 3.9% of average total assets -- and an equity-to-assets ratio of 11.7% as of June 2017 and 
  4. a stable deposit-based funding structure and strong local currency liquidity buffers. The local currency deposit and issuer ratings also continue to incorporate one notch uplift from the bank's b3 BCA based on our assessment of a high probability of government support in case of need.

The decision to downgrade the long term foreign currency deposit rating to B3 and the foreign currency national scale ratings to A3.ng/NG-2 follows the downgrade of the relevant country ceiling, which captures foreign currency and convertibility risks. Similarly, the downgrade of the bank's long-term CR Assessment reflects the government's weakened capacity to provide support in case of need. As a result, the CR Assessment, which is positioned one notch above the adjusted BCA of b3, reflecting Moody's view that its probability of default is lower than that of deposits, no longer benefits from an additional notch of government support uplift.

Access Bank Plc

Moody's has today affirmed the BCA and adjusted BCA of Access at b2, long-term CR Assessment at B1(cr) and global scale short-term deposit and issuer ratings at Not-Prime. Concurrently, Moody's has downgraded Access' long-term local currency deposit rating to B2 from B1, long term foreign currency deposit rating to B3 from B2, long-term local and foreign currency issuer ratings to B2 from B1, long term local currency national scale deposit ratings to A1.ng from Aa2.ng and foreign currency national scale deposit ratings to A3.ng/NG-2 from Aa3.ng/NG-1. The outlook on all long-term deposit and issuer ratings remains stable.

The affirmation of the bank's BCA reflects its strong asset quality metrics and robust loan underwriting standards and risk management processes, large local currency liquidity buffers, and resilient capital buffers. These strengths are balanced against concentration risks in the bank's loan book, including its exposure to loans denominated in foreign currency.

The downgrades are primarily driven by the rating agency's view that the government's capacity to provide support for Nigerian banks in times of stress has weakened as indicated by Moody's recent downgrade of Nigeria's government bond ratings to B2 stable from B1 stable. The decision to downgrade the long term foreign currency deposit rating to B3 and the foreign currency national scale ratings to A3.ng/NG-2, follows the downgrade of the relevant country ceiling, which captures foreign currency and convertibility risks. The downgrade of the local currency deposit NSR is a result of the repositioning of our relative ranking of Nigerian banks within our NSR map following the downgrade of the corresponding local currency deposit global scale rating.

Guaranty Trust Bank Plc

Moody's downgraded GTBank's BCA and adjusted BCA to b2 from b1, long-term local currency deposit rating to B2 from B1, long term foreign currency deposit rating to B3 from B2, long-term local and foreign currency issuer ratings to B2 from B1, long term local currency national scale deposit ratings to Aa3.ng from Aa1.ng, foreign currency national scale deposit ratings to A3.ng/NG-2 from Aa3.ng/NG-1 and long-term CR Assessment to B1(cr) from Ba3(cr). The Aa3.ng/NG-1 local currency deposit national scale rating (NSR) now represents the highest attainable NSR rating in Nigeria. The global scale short-term deposit and issuer ratings were affirmed at Not-Prime. The outlook on all long-term deposit and issuer ratings remains stable.

The downgrades are primarily driven by the bank's high exposure to government securities that link the bank's credit profile to that of the government. The decision to downgrade the long term foreign currency deposit rating to B3 and the foreign currency national scale ratings to A3.ng/NG-2, follows the downgrade of the relevant country ceiling, which captures foreign currency and convertibility risks. The downgrade of the local currency deposit NSR is a result of the repositioning of our relative ranking of Nigerian banks within our NSR map following the downgrade of the corresponding local currency deposit global scale rating.

  1. GTBank's ratings reflect the bank's resilient earnings generation capacity and robust capital buffers, which together provide a relatively thick cushion to withstand asset quality deterioration compared with domestic peers, 
  2. the bank's high liquidity buffers and a predominantly deposit funded balance sheet, and 
  3. the bank's robust franchise, which allows it to attract inexpensive deposits and to lend to high credit quality borrowers (relative to other Nigerian banks), resulting in relatively strong asset quality metrics and low credit costs.

Sterling Bank Plc

Moody's also affirmed the BCA and adjusted BCA of Sterling at b3, long-term local currency deposit rating at B2, local and foreign currency issuer ratings at B2 and global scale short-term deposit and issuer ratings at Not-Prime. Concurrently, Moody's has downgraded the long term foreign currency deposit rating to B3 from B2, long-term CR Assessment to B2(cr) from B1(cr), long term local currency national scale deposit ratings to A2.ng from A1.ng and foreign currency national scale deposit ratings to A3.ng/NG-2 from A2.ng/NG-1. The outlook on all long-term deposit and issuer ratings remains stable.

  1. The affirmations reflect Sterling's resilient deposit funded balance sheet and stable local currency liquidity balanced against,
  2. the bank's low foreign currency liquidity buffers, and 
  3. vulnerabilities in asset quality on account of high single-name and sector concentration risks. The local currency deposit and issuer ratings also continue to incorporate one notch uplift from the bank's b3 BCA based on our assessment of a high probability of government support in case of need.

The decision to downgrade the long term foreign currency deposit rating to B3 and the foreign currency national scale ratings to A3.ng/NG-2, follows the downgrade of the relevant country ceiling, which captures foreign currency and convertibility risks. Similarly, the downgrade of the bank's long-term CR Assessment reflects the government's reduced capacity to provide support in case of need. As a result, the CR Assessment, which is positioned one notch above the adjusted BCA of b3 reflecting Moody's view that its probability of default is lower than that of deposits, no longer benefits from government support uplift. The downgrade of the local currency deposit NSR is a result of the repositioning of our relative ranking of Nigerian banks within our NSR map following the downgrade of the corresponding local currency deposit global scale rating.

United Bank for Africa Plc (UBA)

Moody's has today affirmed UBA's BCA and adjusted BCA at b2, long-term CR Assessment at B1(cr) and global scale short-term deposit and issuer ratings at Not-Prime. Concurrently, Moody's has downgraded UBA's long-term local currency deposit rating to B2 from B1, long term foreign currency deposit rating to B3 from B2, long-term local and foreign currency issuer ratings to B2 from B1, long term local currency national scale deposit ratings to A1.ng from Aa2.ng and foreign currency national scale deposit ratings to A3.ng/NG-2 from Aa3.ng/NG-1. The outlook on all long-term deposit and issuer ratings remains stable.

The affirmations reflect (1) the bank's resilient asset quality profile, which is more geographically diversified than most of its peers and (2) then bank's predominantly deposit funded balance sheet, which is supported by a solid pan-African franchise.

The downgrades are primarily driven by Moody's view that the government's capacity to provide support for Nigerian banks in times of stress has weakened as indicated by Moody's recent downgrade of Nigeria's government bond ratings to B2 stable from B1 stable. The decision to downgrade the long term foreign currency deposit rating to B3 and the foreign currency national scale ratings to A3.ng/NG-2, follows the downgrade of the relevant country ceiling, which captures foreign currency and convertibility risks. The downgrade of the local currency deposit NSR is a result of the repositioning of our relative ranking of Nigerian banks within our NSR map following the downgrade of the corresponding local currency deposit global scale rating.

Zenith Bank Plc

Moody's also downgraded Zenith's BCA and adjusted BCA to b2 from b1, long-term local currency deposit rating to B2 from B1, long term foreign currency deposit rating to B3 from B2, long-term local and foreign currency issuer ratings to B2 from B1, long term local currency national scale deposit ratings to Aa3.ng from Aaa.ng, foreign currency national scale deposit ratings to A3.ng/NG-2 from Aa3.ng/NG-1, long-term CR Assessment to B1(cr) from Ba3(cr). The Aa3.ng/NG-1 local currency deposit NSR now represents the highest attainable NSR rating in Nigeria. The global scale short-term deposit and issuer ratings were affirmed at Not-Prime. The outlook on all long-term deposit and issuer ratings remains stable.

The downgrades are primarily driven by the bank's high exposure to government securities that links the bank's credit profile to that of the government. The decision to downgrade the long term foreign currency deposit rating to B3 and the foreign currency national scale ratings to A3.ng/NG-2, follows the downgrade of the relevant country ceiling, which captures foreign currency and convertibility risks. The downgrade of the local currency deposit NSR is a result of the repositioning of our relative ranking of Nigerian banks within our NSR map following the downgrade of the corresponding local currency deposit global scale rating.

Zenith's ratings reflect (1) the bank's resilient earnings generating capacity and robust capital buffers, which together provide a cushion to withstand asset quality deterioration, (2) the bank's high liquidity buffers and a predominantly deposit funded balance sheet, and (3) the bank's robust franchise, which allows it to attract inexpensive deposits and to lend to high credit quality borrowers (relative to other Nigerian banks), resulting in relatively strong asset quality metrics and low credit costs.

Bank of Industry

Moody's downgraded Bank of Industry's long-term local and foreign currency issuer ratings to B2 from B1 and its long term local and foreign currency national scale issuer ratings to Aa3.ng from Aa1.ng. The Aa3.ng/NG-1 national scale issuer rating now represents the highest attainable national scale rating (NSR) in Nigeria. All global scale short-term issuer ratings were affirmed at Not-Prime. The outlook on all long-term issuer ratings remains stable.

Bank of Industry's b2 standalone profile remains unchanged and reflects (1) its robust capital buffers, with an equity to assets ratio of 34.0% as of June 2017, (2) a stable liability structure made up of long-term funding at concessional rates and (3) the tangible improvements to the bank's risk positioning in recent years. These strengths are balanced against (4) our expectation that asset quality will be increasingly pressured given then bank's higher risk exposure to the micro, small and medium-sized enterprises (MSMEs) segment, which exposes it to riskier assets.

The downgrades are primarily driven by Moody's view that the government's capacity to provide support for Nigerian banks in times of stress has weakened as indicated by Moody's recent downgrade of Nigeria's government bond ratings to B2 stable from B1 stable. The downgrade of the NSR is a result of the repositioning of the bank's rating within our NSR map following the aforementioned downgrades of the corresponding global scale ratings.

WHAT COULD MOVE RATINGS UP OR DOWN

A demonstrated ability to contain non-performing loans while maintaining solid core profitability and capital generation could put upward pressure on the banks' BCAs or lead to a stabilisation in the outlook in the case of FBN. An upgrade of the banks' global scale deposit and issuer ratings would be contingent on an improvement in the operating environment that translates to an upgrade of Nigeria's sovereign rating.

The ratings could be downgraded in the event of a further downgrade of the sovereign and/or if we assess that the government's willingness to provide support in the future will decline below our current assumptions. The ratings could also be downgraded if we anticipate that a deterioration in the macro environment poses downside risks for asset quality and/or the capital generation capacity of the banks beyond what is already assumed in the ratings.

Published in Bank & Finance

Rapid advances in artificial intelligence and the rapid adoption of robots across diverse industries are stalking the fear of jobless growth. Responses to these developments have focused on what to do to ensure that robots don’t steal jobs.

Bill Gates, for example, has called for the taxing of robots that take away jobs. This has elicited responses from leading economists, such as Larry Summers (former Vice President of Development Economics, Chief Economist of the World Bank, and US Treasury Department official) who argue against the idea saying that robots are job creators and that the idea of taxing them is profoundly flawed.

An equally questionable idea is to use universal basic income – the idea that everyone receives a minimum income regardless of circumstance – to redress the impact of technological unemployment.

The focus in these debates is misplaced. Jobs are not created or lost because of a single technology, but because of the business models designed to leverage the power of the technology. Uber, for example, may be called a “taxi-hailing app” service but the business is a constellation of applications including algorithms, the automobile and GPS – all of which are organised around a single business model.

We’ve seen a similar example in history, with recorded music in the last century. It wasn’t the 1930s recording technology itself that threatened the jobs of live musicians. It was its combination with radio broadcasting, jukeboxes and the way businesses operated that led to job losses. Hotels, restaurants and bars replaced live musicians with jukeboxes. The coin-operated machines were cheaper and did not involve dealing with the demands of unionised musicians. A single recording could be played over and over without requiring the appearance of musicians.

As I argue, in “Innovation and Its Enemies: Why People Resist New Technologies”, the early recording of music destroyed the jobs of some live musicians and undermined their claim to property rights. The social objections became largely about monopoly power and less about the technology itself.

The technology did make huge gains for the music industry because of its ability to access a wider section of society. Small bands and minority musicians who could not have access to large markets were able to use the technology to reach niche audiences. More importantly, the spread of the technology made it possible for new genres, such as bebop, of music to emerge and eventually enter mainstream markets.

However, while history helps us to learn from the past, it has become a poor guide for emerging trends. This is because of the qualitative differences between discrete technologies that defined the Industrial Revolution of the early 1800s and today’s machines and platforms.

Different rules

These fundamental differences – between past automation activities and today’s artificial intelligence – suggest the emergence of new economies operating under different rules whose contours are still sketchy.

The impacts will be strongly felt, given the integrated nature of the global economy, the rapid rate of technological change and the uncertainty created by technological abundance – which makes it difficult to predict where new ideas might come from.

Job creation – or loss – has to be considered in the context of the overall business.

This is best illustrated by looking at the difference between recorded music then and robots now. I have identified four big ones.

First, robots are being adopted at a much faster rate than recorded music was. Competitive pressures in industry are forcing entrepreneurs to look into deploying technological systems that enable them to stay ahead of the curve. Chinese manufacturers, for example, are responding to wage increases with one of the fastest rates of industrial robot adoption in the world.

Second, the consequences of robots are likely to be felt across global value networks triggering large-scale technological anxieties as workers fear that their jobs will be taken. This is partly because many of the leading industries rely on supply chains that are located in different regions and countries. Boeing, for example, sources parts from various parts of the US, Europe and many other parts of the world. Changes in its manufacturing practices involve coordination across those regions. This also applies to less complex products such as consumer goods.

Third, robots are advancing exponentially while human learning occurs at a much slower linear pace. Their rate of learning doubles in a short period while human learning is incremental and slow. This is partly a result of technological abundance and the growing ability for machines to teach each other how to improve the functioning of their algorithms. 3D printing, for example, is a combination of pre-existing mechanical technologies which now benefits from advances in digital technologies. It can now be diversely applied – from engineering to medicine. The more new technologies that are created, the greater the prospects of creating new applications. In many cases innovators start off with searching and using what already exists in novel ways before they invest in new research.

Finally, the effects of automation are likely to be felt over very short periods, compounding public concerns and leaving little room for adaptation. This is mainly because machines are reaching a point where they are learning to perform new tasks faster than workers can be retrained.

What next

What we need are inclusive social policies that take into account faster access to emerging technologies, greater support to new businesses and more open dialogue about how poverty and inequity amplify the negative effects of new technologies.

This requires a much deeper look at how social systems and technologies shape each other to create more just and resilient economies.

 

Calestous Juma, Professor of the Practice of International Development, Harvard Kennedy School, Harvard University

This article was originally published on The Conversation. Read the original article.

Published in Engineering

It has been a difficult year for South Africa. In September the World Bank downgraded South Africa’s 2017 growth forecast to 0.6 percent, down from 1.1 percent at the beginning of the year. To get ahead the South African economy is in urgent need of more entrepreneurs to boost growth, foster innovation, and aid in job creation.

The reality is that much more must be done to create an enabling environment for entrepreneurship to truly flourish.

As we enter Global Entrepreneurship Week and acknowledge Women’s Entrepreneurship Day on 17 November, it is worthwhile to take stock of the current entrepreneurial landscape in South Africa and seriously question Donna Rachelson Seed Academyhow best to forge ahead. This is especially important considering government’s National Development Plan places the onus on small and expanding businesses to create some 90 percent of new jobs, with the ultimate goal of reducing unemployment to just 6 percent by 2030.

This is no small task given that in real terms the country needs to create about 11 million more jobs in the next 12 years supported by an average economic growth of 5.4 percent every year over the period to achieve that aim. Couple this with the World Bank’s projection that for 2018 and 2019 South Africa’s GDP growth is expected to pick up to a meek 1.1 percent and 1.7 percent respectively and it becomes clear that decisive action is urgently required.

Earlier this year Seed Academy conducted South Africa’s largest entrepreneurial survey, the Real State of Entrepreneurship in South Africa 2017. The survey canvassed over 1,200 entrepreneurs at any stage of business development to understand the nature of the challenges faced by entrepreneurs in key areas such as access to funding, business support and skills development. South Africa needs to significantly scale and improve the efficiency of SME funding especially in light of the fact that most early-stage business funding requirements are below R100k. In addition, further research indicates that while it is critically important to encourage new entrepreneurs, it is equally important to provide support to growing SMEs which only start to meaningfully contribute to job creation when they grow to R2 million or more in turnover.

The Global Entrepreneurship Monitor (GEM) report for 2016/2017 notes that Africa is the region reporting the most positive attitudes towards entrepreneurship, with three quarters of working-age adults considering entrepreneurship a good career choice while 77 percent believe that entrepreneurs are admired in their societies. In South Africa the right attitudes to entrepreneurship deserve the right support. By way of comparison, in Rwanda it takes an entrepreneur 12 days to register and start a business, while here at home the same process takes an average of 45 days. National policy makers should take note of this and focus on regulatory reforms to make it easier for new businesses to register and operate.

The recent GEM report highlights that countries with high rates of entrepreneurial success also have effective support structures from private and public sectors as well as established mentorship programmes for both aspirant and current entrepreneurs.

Seed Academy’s own entrepreneurial survey shows that local entrepreneurs see immense value in participating in training programmes with 78 percent of respondents indicating that they had engaged in entrepreneur training programmes or were part of an incubator at some point. Corporate enterprise and supplier development programmes also featured, although to a far lesser extent, with 14 percent of respondents having been part of these, indicating that more can be done to educate entrepreneurs about various ESD programmes available together with clear information on participation requirements.

Globally, the importance and benefits of increasing the economic participation of women are well understood. In South Africa, support for black women and youth entrepreneurs in particular continues to be critical to unlocking South Africa’s entrepreneurial potential.

Recently the World Economic Forum (WEF) issued its annual Global Gender Gap Report which found that should current rates persist, it will take 100 years before women achieve equality in the four areas measured by the WEF including political empowerment, economic participation, health and education. In South Africa we still have much work to do, but there are promising signs of change as the gap between the number of male and female entrepreneurs begins to narrow slightly, proving that efforts focused on the development of women owned businesses do pay off.

Given that entrepreneurs and small businesses are being tasked with the massive responsibility of reviving the economy and creating millions of new jobs, we owe it them to improve the entrepreneurial ecosystem and ensure an enabling environment for businesses to grow and thrive. Better and more robust engagement with policy makers and providers of financial and non-financial support is one place to start. Taking into consideration the ambition of the task, determined vision and leadership are needed from all sections of society as soon as possible.

Published in Business

Pollinators are the unsung heroes of food production. Almost one third of the food eaten comes from animal pollination. Animal pollinated foods also contain nutrients and minerals essential to human diets and they maintain natural areas by pollinating wild plants.

But understanding the relationship between plants and pollinators isn’t straightforward. Nevertheless, it matters because some indigenous pollinators are under threat. This is particularly challenging in South Africa which has a rich collection of indigenous pollinators. The list includes bees, predacious wasps, pollen wasps, beetles, moths and birds. This huge diversity makes it even more difficult to study plant interactions with pollinators purely through observation.

In the last couple of years, DNA-based techniques like next generation sequencing have been increasingly used to identify pollen on pollinators and their products, like honey. The technology reads the DNA from a mixed pollen sample and then compares the DNA to a reference database to obtain identifications. The short, specific DNA fragments targeted from the pollen sample are used as “barcodes” to identify the plant species from which it originated. Using a standard set of genes, combined with next generation sequencing, to identify plant species from their pollen is referred to as metabarcoding.

Pollen metabarcoding has led to huge strides in understanding the relationship between pollinators and plants. And there’s an ongoing project to barcode the plants of southern Africa, using genes in the chloroplasts of plants. This is undoubtedly good news for the metabarcoding of mixed pollen samples to study plant-pollen interactions.

In our recent review, we discussed the field of plant-pollinator interactions and the impact and study of these relationships, focusing on South Africa. It highlights the advances made by South African scientists using cutting edge molecular technologies like pollen metabarcoding.

This work has the potential to shed new light on the complexity of pollination in South Africa’s ecosystems – in both the natural as well as agricultural ecosystems.

Why it’s complicated

A generalist, nonselective pollinator can pollinate multiple plant species, or several pollinators could pollinate a single plant.

Exclusive relationships also exist. This happens when specialised pollinators and plants have a close mutualistic relationship. In some cases, they develop compatible morphological features like, for example, the oil collecting bees (genus Rediviva) and Diascia flowers.

Pollinators seen on a flower may be visiting them for rewards other than pollen. They could, for example, be hunting for nectar. And it’s possible that they may not be involved in the successful pollination of the flower they were visiting. The pollen found on these pollinators could have come from a different plant species altogether. So, observing pollinators on flowers could be misleading in trying to understand pollination networks.

Traditionally, plant-pollinator interactions were investigated through field observations, microscopic pollen identification – or palynology – and cage studies. The process was slow and required a lot of expertise to correctly identify plants from their pollen.

How do DNA-based techniques work?

Increasingly DNA-based techniques – like next generation sequencing – are being used to identify pollen on pollinators and their products.

The technology reads the DNA amplified from a mixed pollen sample, and then compares the DNA to a reference database for identification. Mixed pollen samples can be identified by genes contained in pollen nuclei or chloroplasts. Using a combination of these genes in the identification of mixed pollen samples provides more accurate results than studying only a single gene.

The sequence reference database used to compare pollen DNA sequences needs to be suitably comprehensive to get accurate identifications. The project to barcode plants in southern Africa is making significant progress. This means that the sequence database for the country’s diverse plants are becoming more complete for the genes used in pollen metabarcoding. In turn, this means that more accurate identifications can be made from pollen collected from pollinators.

The well-being of pollinators has a direct impact on our lives – from the food we eat, to the clothes we wear and even the natural environments we relax in. On top of this, the interactions between pollinators and plants ensure the long term sustainability of agricultural and native environments.

Understanding these interactions and how they change over time will help us to identify what’s threatening plant and pollinator communities, both of which are key to long term food and ecosystem sustainability.

 

Dirk Swanevelder, Senior Researcher, ARC Biotechnology Platform, The Agricultural Research Council; Annemarie Gous, PhD in Conservation Genetics, The Agricultural Research Council; Connal D. Eardley,, Specialist Scientist Plant Protection Research Institute Agricultural Research Council, South Africa, The Agricultural Research Council, and Sandi Willows-Munro, Researcher and Lecturer Genetics, University of KwaZulu-Natal

This article was originally published on The Conversation. Read the original article.

Published in Agriculture

Got some bitcoin burning a hole in your digital wallet? And paradise on the mind? You may be able to use it to buy a second passport.

Fork over 49.3 bitcoins, the equivalent of about $280,000 to a brokering agent, and your family of up to four might be able to receive passports to Vanuatu via so-called investment citizenship. The New Economics Foundation, a U.K.-based think tank, calls the South Pacific archipelago of some 80 islands the fourth-happiest country in the world. (It ranked No. 1 when the list was first published in 2006, but like the vagaries of the market, happiness can be a fleeting thing.)

As volatile as the cryptocurrency itself, so has the local reaction been to this idea, which was first reported by Investment Migration Insider, a website focused on investment citizenry.

“The Citizenship Commission is only recognizing USD as prescribed under the Citizenship regulation and no other form,” said Samuel Garae, Acting Secretary General of the Vanuatu Citizenship Office, in an emailed statement on Oct. 20, correcting earlier reports that Vanuatu would accept payments directly.

“This might be from the Agents but not Citizenship,” he continues, referring to a non-binding letter from Vanuatu’s Parliamentary Secretary that lent support to the idea of allowing bitcoin payments. All final payments would still need to be handed to the government in American dollars.

Vanuatu joins other island nations such as Antigua, Grenada, Malta, and St. Kitts and Nevis in offering citizenship for a price. Advantages include the 34th-most-“powerful” passport in the world, providing visa-free visits to 116 other countries, according to the Passport Index, a list of rankings maintained by Arton Capital, a company that facilitates foreign residence and citizenship applications. Vanuatu falls right below Panama and Paraguay (tied) and above Dominica; the U.K. is in a tie at third place, the U.S. at fourth, and Russia at 40th.

The country also has no income, inheritance, or corporate tax. It’s not even customary to tip there, according to the Vanuatu Tourism Office. The archipelago is relatively accessible: about a three-and-a-half-hour flight from Sydney to Port Vila, the capital. And scuba aficionados will appreciate that it’s home to the world’s largest diveable wreck—the SS President Coolidge, a luxury liner-turned-troop ship that sank during World War II.

Should you really want a place to escape, Vanuatu’s abundance of islands and relatively small population (about 290,000) mean that your own private island may be within reach. The least expensive one currently on the market, according to real estate website Private Islands Online, is Lenur, priced at about $645,000. For that you get 84 acres including three sandy beaches, a handful of sleeping bungalows, and an open-plan kitchen. Most of the property is covered in coconut, fruit, and nut trees.

Still, like investing in cryptocurrency in the first place, tropical life doesn’t come without risks. Earlier this month, residents had to be evacuated from the northern island of Ambae because its volcano, Manaro Voui, had rumbled to life and was spewing steam and rocks.

 

- Bloomberg

Published in Travel & Tourism

The federal government has disagreed with Moody's downgrading of Nigeria to a B1 stable rating to a B2 stable rating. The latest B2 rating is equivalent to Nigeria's existing B/Stable Outlook rating from S&P and slightly lower than Nigeria's B+/Negative Outlook rating from Fitch.

A response by the Federal Ministry of Finance (FMF), Central Bank of Nigeria (CBN) and the Debt Management Office (DMO) indicated that since Nigeria was last rated by Moody's (as B1 stable) in December 2016, Nigeria has successfully emerged from a protracted recession and recorded important improvements across a broad range of indices.

"While we respect the right of Moody's to make this decision, we strongly disagree with the premise and must address some of the conclusions upon which the decision rests," the response stated.

The federal government pointed the attention of Moody's to Nigeria's return to economic growth of 0.55 per cent in Q2 2017, and returning business confidence, as evidenced by a PMI index of 55.0.

The nation's fiscal and monetary authorities also noted that the country now has a stable foreign exchange window for importers and exporters, with improving liquidity and convergence of the parallel and official rates. The stability in foreign exchange market led to improved foreign exchange reserves, now totalling $34 billion.

The government also noted increased oil production, combined with stable and now improving oil prices; a slowly improving revenue profile, with non-oil revenue (principally taxes) up 10 per cent; month on month improvements in inflation levels since January 2017, with inflation continuing to trend downwards and strong year on year improvement on the World Bank Ease of Doing Business Rankings from 169th to 145th place, a 24 place move in one year.

The federal government said Moody's rationale hinged on the need for Nigeria to improve non-oil revenue aggressively is absolutely and directly aligned to the government's priorities.

"We have put in place a number of measures to improve our collection and FIRS has made good progress in increasing revenues, particularly when considering that the economy is still recovering from the oil price shock," the statement stated.

 

- Daily Trust

Published in Economy

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