Tuesday, 26 May 2020

The COVID-19 pandemic is now expected to trigger the worst economic downturn since the Great Depression. Many argue it could unravel globalisation altogether.

Globalisation relies on complex links – global value chains (GVCs) – that connect producers across multiple countries. These producers often use highly specialised intermediate goods, or “inputs”, produced by only one distant, overseas supplier. COVID-19 has severely disrupted these links.

Although the global economy was fragile at the start of 2020, many hoped for increased international trade following the US-China Phase One trade deal. COVID-19 has scuppered those hopes, bringing the world’s factories to a standstill and severely disrupting global supply chains.

China plays a key role in this. According to Chinese customs statistics, the value of Chinese exports in the first two months of 2020 fell by 17.2% year on year, while imports slowed by 4%.

Author provided

This drop in Chinese trade impacted some markets more than others. Comparative figures between the first two months of 2019 and the first two months of 2020 reveal a collapse in Chinese trade with the EU and US. Chinese exports to the EU fell by 29.9%, while imports from the EU declined by 18.9%. Exports to and imports from the US tumbled 27% and 8% respectively.

These substantial declines are likely related to the strong interdependence between European and US firms and Chinese ones.

The scale of the shock

To understand the magnitude of the supply shock in China and its global propagation, the Lloyds Banking Group Centre for Business Prosperity (LBGCBP) at Aston University has mapped China’s global trading networks using official Chinese data.

In 2019, the US had the highest trade dependence on China, followed by seven European countries and Japan. By 2020, European countries had moved even further up the rankings.

As the pandemic continues, the worst affected Chinese exports include capital goods such as nuclear reactors, intermediate goods like iron, and labour intensive final goods such as furniture.

The most disrupted Chinese imports include intermediate goods such as organic chemicals, a likely result of factory closures in China, and capital goods like electrical machinery. Hardest hit were precious stones and metals, highlighting the emergence of a sophisticated middle-class of Chinese shoppers and how COVID-19 has reduced their demand for luxury goods.

Trade has tumbled between the EU and China. Shutterstock

Interestingly, Chinese imports of meat and mineral fuels increased sharply in 2020. The first can be explained by China’s weakened domestic supply of food during lockdown. The second highlights China’s growing demand for crude oil.

Four product categories have been particularly hard hit as both imports and exports: nuclear reactors, electrical machinery and equipment, plastics, and organic chemicals. These categories include some commonly used intermediate goods (those that are used for producing other goods).

Under normal circumstances, such goods would be traded back and forth between China and other countries as part of the heavily interconnected global production system. This significant drop in their international trade highlights the devastating effect of COVID-19 on GVCs.

An uncertain future

But an unprecedented, synchronised and likely deep fall in demand is now developing. And China was again among the first to feel its impact.

Chinese workers returned to work in April but many no longer had jobs. Widespread cancellations of international orders and delayed payments have led to liquidity problems and mass closures of businesses reliant on global demand.


Read more: How to boost UK productivity after coronavirus


Investment also tumbled. During February and March 2020, official Chinese statistics report 24.4% fewer new foreign trade enterprises established in China compared to the same period last year. Meanwhile, 12,000 existing foreign trade enterprises closed down.

Agriculture, logistics and those producing raw materials, textiles and clothing have been hardest hit. But, on a more positive note, there has been a surge in demand for medical supplies.

Many are now highlighting the dangers of relying on global value chains – and in particular, those linked to China – leading to talk of “de-globalisation”.

The European Commission president, Ursula von der Leyen, for example, has called for the “shortening” of global supply chains because the EU is too dependent on a few foreign suppliers. Similarly, the French president, Emmanuel Macron, has argued for a strengthening of French and European “economic sovereignty” by investing at home in the high tech and medical sectors.

So is this the end of globalisation? No. But a reconfiguration of GVCs is inevitable.

A way forward

Global supply chains are extremely complex, and no sector or country is an island.

Complex: a sample network of GVCs. World Input-Output Database (WIOD), 2014. Based on author’s calculation., Author provided

But GVCs follow the principle of efficiency. They are the result of businesses sourcing the best possible inputs to meet their production needs at the lowest cost – wherever those inputs come from.

This is good news for globalisation’s survival. While efficiency remains the main target, businesses will continue to shop globally.

Concerns about an overreliance on complex GVCs are justified in the case of products related to national security, such as medical supplies. Many countries will now ensure they can produce such goods without relying on imports.

Nobody can predict the next crisis. But the most reliable and efficient insurance by far is to build a strong international cooperation network. As yet, global political consensus on this remains elusive. But that doesn’t mean we should ever lose the ambition.The Conversation

 

Jun Du, Professor of Economics, Centre Director of Lloyds Banking Group Centre for Business Prosperity (LBGCBP), Aston University; Agelos Delis, Lecturer in Economics, Aston University; Mustapha Douch, Research Fellow in Economics, Lloyds Banking Group Centre for Business Prosperity (LBGCBP), Aston University, and Oleksandr Shepotylo, Lecturer in Economics, Aston University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Published in Business

Pay television service providers will no longer lock out competitors from using their set-top boxes to broadcast content to consumers.

In a judgment that throws the subscription-based TV services sector into a spin, Court of Appeal judges threw out an appeal filed by MultiChoice Limited challenging High Court Judge Mumbi Ngugi’s judgment on the sale of locked set-top boxes.

In a court battle that pitted MultiChoice, Wananchi Group Kenya Limited, Kenya Broadcasting Corporation (KBC), and the Communication Authority (CA), Justice Ngugi directed that all set-top boxes be open and operable between networks.

Aggrieved, MultiChoice moved to the Appellate Court and lodged a complaint that the judge had erred by addressing the set-top boxes issue while it was not the case before her.

In the case that was heard by justices William Ouko, Asike Makhandia, Patrick Kiage, Gatembu Kairu and Fatuma Sichale, the company argued that Justice Ngugi ought to have restricted herself to the licensing of signal distribution.

The five-judge bench, however, found that MultiChoice failed to provide sufficient evidence to warrant overturning of the High Court judgment.

“Therefore, on a full consideration of the material on record and arguments before us, I have concluded that no grounds have been presented to us to warrant interference with the learned judge’s exercise of discretion,” ruled Justice Ouko.

He continued: “I adopt those views as they mirror what happened in the appeal before us, where the judge arrived at her determination based on the law and evidence before her. If in the appellant’s opinion the conclusions were erroneous, it could only appeal.”

Monthly subscription

MultiChoice offers different programmes through its DStv and GoTV set-top boxes that are only available to subscribers who pay a monthly fee. When the subscription lapses, its customers are blocked from accessing both its programmes and free-to-air content provided by other broadcasters.

Wananchi also offers a similar service through its Zuku set-top boxes.

The genesis of the case can be traced back to the migration from analogue to digital broadcasting when the CA’s predecessor, the Communications Commission of Kenya (CCK), designated KBC to set up a private company that would manage signal distribution services to avoid conflict of interest.

This led to the creation of a subsidiary, Signet Limited.

It was not long before a dispute broke out on how the CCK was treating MultiChoice and other players.

Wananchi Group told Justice Ngugi that CCK was giving its competitor preferential access to the broadcasting distribution system provided by KBC. The firm argued that CCK and KBC were permitting MultiChoice to sell locked set-top boxes that restricted content to the GoTV platform.

According to Wananchi, the State agencies were in breach of their statutory duty because they were giving a commercial advantage to MultiChoice while denying them the same opportunity.

Wananchi also urged the court to restrain Signet from providing signal distribution services as it was not registered.

Justice Ngugi found that KBC was breaching the public’s right to receive information and the digital broadcasting policy guidelines in its partial dealings with MultiChoice.

She ruled that although KBC had not renewed its one-year license, it did not breach Wananchi Group’s rights, but was instead a dereliction of duty by the CCK.

 

THE STANDARD KENYA

Published in Telecoms

The number of convictions related to corruption in China nearly doubled last year, according to a report by Beijing’s top prosecutor, as President Xi Jinping ramped up his crackdown on graft.

According to the annual report from the Supreme People’s Procuratorate submitted to the national parliament, 18,585 people were prosecuted for crimes related to corruption in 2019, a 90 percent year-on-year increase.

Sixteen cases involved former provincial or ministerial-level Communist Party cadres, including former Yunnan party chief Qin Guangrong, who was accused of taking bribes.

The latest high-profile targets of the anti-corruption campaign include former shipbuilding executive Hu Wenming and ex-deputy national security minister Sun Lijun, who were both placed under investigation for “serious violations of discipline and the law” in May and April respectively.

Last year also saw a 50 percent rise in the number of cases involving Communist Party members transferred to prosecutors for investigation, according to the report, which was discussed Monday afternoon.

China is holding its delayed annual National People’s Congress this year, but with much stricter controls on access and many sessions closed to the media due to the coronavirus outbreak.

A total of 25,000 trials involving corruption, malfeasance and bribery were concluded last year, which led to 29,000 people being convicted, according to the Supreme People’s Court work report released Monday. 

More than a million officials have been punished under the anti-corruption campaign so far, which has been a cornerstone of Xi’s seven-year tenure.

Critics have accused the campaign of targeting Xi’s political enemies. 

The Supreme People’s Court also reported that there were 22 trials under the controversial martyrs’ law, which criminalises all insults to Communist heroes.

Several internet users and even an online comic platform have been punished since the law was introduced in 2018.

There was also a notable increase in the number of prosecutions last year for cyber crime and intellectual property infringement, at 33 and 32 percent respectively.

The report also said that more than 2,500 people were prosecuted for coronavirus-related criminal offences between February and April this year.

Published in World

Burundi’s ruling party candidate Evariste Ndayishimiye was on Monday declared the winner of the country’s presidential election, but the opposition vowed to contest the results of the “electoral farce”. 

The national election commission announced that Ndayishimiye had won 68.72 percent of the vote, while opposition leader Agathon Rwasa came in far behind with 24.19 percent.

Ndayishimiye, 52, is a former army general who was handpicked by the ruling CNDD-FDD to replace President Pierre Nkurunziza, who has been in power since 2005 and whose final years in office have been wracked with turmoil.

Nkurunziza’s third-term election run in 2015 sparked violence which left at least 1,200 dead and pushed 400,000 to flee the country. 

Ndayishimiye is set to inherit a deeply isolated country, under sanctions and cut off by foreign donors, its economy and national psyche damaged by the years of political violence and rights violations.

The election was conducted with scant regard to the coronavirus outbreak — which has been largely ignored.

No foreign observers were allowed in to keep an eye on the election process.

“The CNL continues to contest these results which came about through massive fraud, because the election took place in conditions that remove all credibility,” Therence Manirambona, spokesman for the National Freedom Council (CNL), told AFP.

He said the party was putting together a legal complaint and “will follow the law and tomorrow or the day after tomorrow we will submit it so that the court can take a decision on the massive fraud that marked this electoral farce.”

He said that according to the CNL’s data, they should have won the poll with around 57 percent. Rwasa, the main opposition candidate, attracted large crowds throughout his campaign, and observers said he may reap the benefit of a populace exhausted by the CNDD-FDD’s rule.

The CNL has alleged the stuffing of ballot boxes, proxy voting, intimidation, and said its polling agents were arrested or booted out during voting and counting.

– ‘Calm and vigilant’ –

The commercial capital Bujumbura was calm on Monday, with shops open and only a slight increase in the visibility of security forces.

A high-ranking member of the ruling party, who spoke on condition of anonymity, said the party had urged its supporters to remain calm.

“The message was to remain calm and vigilant … not to provoke and that when the time is right the party will tell us when to celebrate our victory.”

The election commission has yet to respond to the fraud allegations, but Pierre Nkurikiye, the spokesman for Burundi’s public security ministry, accused members of the CNL of attempted fraud, confirming some of their members were arrested for minor incidents.

A foreign diplomat in Burundi, speaking anonymously, expressed strong doubts about the official result but said it was not surprising. 

“We were expecting it to happen like this. Nobody could imagine for a second that the CNDD-FDD and its generals would cede power in any way,” the diplomat said.

Burundi, which the World Bank ranks among the world’s three poorest countries, has been under sanctions from its major donors since 2015, when Nkurunziza’s decision to run for a third term as president triggered violent unrest and political chaos.

Burundi is tightly controlled by the ruling party and its youth wing, the Imbonerakure, have been accused of a forceful crackdown against the government’s critics in the aftermath of 2015.

State security forces have been accused by rights groups and the United Nations of crimes against humanity and severe rights abuses such as torture, disappearances, sexual violence and executions.

Ndayishimiye is expected to be sworn in for a seven-year term in late August, when Nkurunziza’s term ends.

Observers have noted it is unclear whether Ndayishimiye would be able to rule free from interference by Nkurunziza, who in February was elevated by parliament to the rank of “supreme guide for patriotism” and will remain chairman of the party’s highly influential council of elders.

The final election results will be declared by the Constitutional Court on June 4.

 

AFP

Published in Economy

Always on the lookout for permanent work, a job advert on Facebook for general workers at South African energy company Sasol seemed timely. But oddly, the post on the aptly named “Jobs Opportunities” page required those interested in applying to comment on it.

Kalunga posted a comment, and waited hopefully. That was the last he would hear of it, even though the page remained active. 

“There was no response, they have not come back to me. I can just see other people commenting also,” he told us.

What he didn’t know was that the job advert was part of an elaborate online scam targeting South Africa’s unemployed, who according to Stats SA’s most recent data numbered nearly 6.7 million in December 2019. 

That number could rise as the economy flies into Covid-19-induced turbulence, setting up even more jobseekers for pain at the hands of fraudsters. 

False job adverts common but easy to spot

Facebook has changed how we socialise online, but is unfortunately also a home for bad information, which ranges from bogus health cures and everyday hoaxes to rumoured deaths. And then there are the job scams, which from our experience are some of the most resilient, targeting both the most vulnerable and the more guarded.

The platform is littered with pages advertising vacancies that do not exist. One repeat offender has consistently advertised nonexistent jobs, including at the South African Social Security Agency, clothing retailer Mr Price and private hospital network Netcare

Often, these false adverts are easy to spot. They tend to be badly written and the links don’t take you to an official website. But many times, it is not as straightforward to pick them out. 

The “Jobs Opportunities” page that raised Kalunga’s hopes previously masqueraded as “Employment Opportunities” before a rebrand. Created in November 2018, it has 50,000 followers. Each job advert it posts attracts hundreds of comments from people looking for work. For example, the advert for general workers at Sasol had more than 1,000 comments.

But the posts don’t directly ask for an application fee – a sure red flag we’ve seen many timeselsewhere. So what then is the end game? 

‘We’ll help if you share this post in 10 groups’

To understand this, a simple overview of the “application” process helps.

The Sasol advert, for example, asks Facebook users to “pliz comment” on the post, stating which of South Africa’s nine provinces they live in. Once you’ve done this, you get a response asking you to share the post in 10 groups. The post also includes a link to a web page where you can apply online. 

People are told sharing the post gives them a good chance of getting the job.

This is the basic modus operandi of several other Facebook pages, including the “Mzansi Careers” page, and others, with hundreds of thousands of followers. 

How does it all work?

Why are jobseekers told to share the post before they can apply for a job? 

The short and obvious answer is so that the scammers can line their pockets. For this to happen a trinity of sorts is essential. First, the Facebook posts lure the victims. Link aggregators then act as a bridge and, finally, Google AdSense ties it up by bringing in the money.

But how do they do it? Africa Check and the Atlantic Council’s Digital Forensic Research Labinvestigated. 

Facebook pages, and less often groups, are used to entice people to engage with the scammer’s network. The network generally focuses on education funding and employment – reliable magnets for people looking for opportunities 

The Facebook posts do not directly link to a job portal or employment website. Rather, when you click the link on a “Jobs Opportunities” post you are taken to a //manylink.co/@careers24" Manylink.com page with more links. This is a link aggregator, and there are lots of them.

A screenshot of the link aggregator used by the scam network.

Link aggregators have legitimate uses and allow users to share many links (or uniform resource locators – URLs – which are the unique addresses of web pages) at once. For some detail on how Manylink works, click here.

They allow you to customise what you want your readers to see. Clicking the customised link in the Facebook post takes you to a landing page with even more links, each seemingly offering different authentic-looking job or training opportunities. 

The Jobs Opportunities landing page is branded as “@careers24”, which resembles Careers24.com, a legitimate career and jobseeker portal in the Media24 group.

When you click any of these new links, you are taken to a fairly basic web page at www.jobscamp.co.za.

At least 760,000 South Africans fooled in 2020

Contacted about the page, Manylink founder Cruize Delaney told Africa Check he had seen an increase in traffic from South Africa since the beginning of 2020. 

“I wondered why this was. I went deeper into my analytics and saw some job sites and pages similar to how you describe that did look unusual,” he said. “That URL you’ve shown me is where a solid amount of South Africa traffic comes from.”

Delaney said “around 760,000” South Africans had visited Manylink so far in 2020. 

Manylink is free to use. Links are currently not reviewed but Delaney said a new version would include tools to help remove users who violated the terms of service. 

Traffic = $$$

Fake job adverts on the Jobs Camp website.

The text for the many job listings on www.jobscamp.co.za is copied from old genuine job adverts or bursary application calls. The closing dates are either deleted or altered to make them seem current. In some cases, the adverts do not explain how, or where, applications must be submitted. In a nutshell, it is a waste of your time.

The website does not list any contact information or any meaningful way to identify the owners. Even username enumeration, which identifies website authors, only revealed that a user labelled “admin” is the main account for the website.

But records revealed that the website was registered by a man from Thohoyandou in Limpopo on 13 August 2019. His name is known to us.

We contacted the registrant to confirm if he was posting fake job adverts on the website and whether he was earning any money doing so. Although the questions were read and acknowledged, he did not respond despite saying he would. (Note: We will update this report should he do so.)

How much money do they make?

The resulting traffic to the website is monetised using Google AdSense, which allows publishers such as website owners to earn money from their online content. 

AdSense estimates that you can earn as much as US$4,500 from 50,000 page views a month. A page view is logged every time a web page is loaded and viewed by a human visitor.

But it also has a strong caution: there’s no guarantee you’ll earn this amount. Actual revenue depends on factors such as advertiser demand, user location, user device, seasonality, ad size and currency exchange rates.

Depending on the advertising model used by the website, Google will either pay for every 1,000 people who see the advert or for each click. In 2017 South African news website Groundup reported earning $0.61 for each 1,000 views. Substantially more is earned when visitors click on ads, with some users reporting about $0.55 per click.

But it is not possible to determine if, or how much, the owner of www.jobscamp.co.za makes from Google adverts. 

‘I feel like they’re playing with us and that’s not right’

CrowdTangle, a social media monitoring platform, revealed that the @careers24 Manylink page was posted more than 500 times on Facebook, to a total of 28.2 million followers.

Njabulo Khumalo from Johannesburg could have been one of them. 

He had been unemployed for two years when he came across the “Employment Opportunities” page during a job search. “I joined a few groups hoping one day somebody will call me but I guess not. I haven’t got anything so far,” he told Africa Check.

And he won’t. He is just one of hundreds of thousands of people lured into an extensive network designed to make money off advert revenue – and off their hopes.

“Some people really depend on these posts. Then you get these people posting jobs on Facebook and at the end of the day nothing happens. I mean that’s really wasting people’s time. I feel like they’re playing with us and that’s not right.” 

 

Cayley Clifford is a researcher at Africa Check. Jean le Roux is a research associate at the Atlantic Council’s Digital Forensic Research Lab.


 

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Published in Telecoms
  1. Opinions and Analysis

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