A new tasty measurement tool for consumer confidence is pointing up for Zimbabwe. The largest brewer in the country Delta Corporation reported a 27% jump in full-year profit to $89 million. What makes the consumption of lager beer an accurate assessment of consumer confidence in Zimbabwe?
Why This Matters: Zimbabweans are still in a celebratory mode after the ascension to power of President Emmerson Mnangagwa. In November he replaced Robert Mugabe, who saw the economy shrink 50% from 2000 until he was ousted. When consumers are drained politically, economically and emotionally they tend to drink liquor. On the other hand, when people are in jubilation the drink of choice is more likely to be wine, beer and champagne.
Delta, which is 40% owned by Anheuser-Busch Inbev (BUD+0.44%), said revenue increased to $572 million during the year that ended in March. Lager beer sales, which accounted for the most revenue, were at their strongest since 2014. The company was able to increase its final dividend payment by 32%, its highest since Zimbabwe dumped its own currency for the U.S. dollar in 2009. AB InBev-affiliated Delta Corp has noted before that the consumption of lager beer is tied to consumer confidence. Read More
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The maker of Chrysler and Mercedes-Benz said it would ramp up its efforts to ensure child labor is nowhere to be found in its supply chain. This announcement came after CNN published a report showing Daimler’s dealers were buying cobalt without verifying where it came from. What will it take for the auto industry to clean up its supply chain?
Why This Matters: A war is brewing among automakers for dominance in the electric vehicle industry and the Democratic Republic of Congo (DRC) is at the center of it. Multiple brands have announced aggressive production plans for their lithium-ion powered vehicles. Volkswagen (VLKAY -0.59%) has plans to produce 1,500 electric vehicles daily. Daimler has pledged to spend $11 billion expanding its electric vehicle passenger fleet over the next few years.
Cobalt is a key ingredient in the manufacturing of lithium-ion batteries which car makers need for their electric vehicles. Prices for the rare earth mineral have surpassed $90,000 and are sure to continue climbing as demand for cobalt increases.
As many as 40,000 children are estimated to be mining the rare earth mineral in crude mines across the DRC. Daimler said it would raise its sustainability standards in partnership with its 1,500 suppliers around the world to ensure human rights abuses like child labor are not taking place in its supply chain. Read More
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The leading mobile telecommunications provider in Kenya Safaricom is launching a messaging app called Bonga. It’s customers will be able to chat and send money on the platform. This will be integrated with the company’s M-Pesa mobile payments app. What impact will this new service have on Safaricom’s dominance over Kenya’s mobile telecommunications industry?
Why This Matters: Safaricom controls 69% of Kenya’s mobile telecommunications market with 29.5 million mobile subscriptions. The company adding messaging capabilities to their customer offerings increases the stickiness of their already dominant M-Pesa platform. Safaricom has seen increased competition from competitors like Airtel Networks and Telkom Kenya whose growing service provisions have eaten into the company’s mobile subscriptions.
The integration of mobile payment technology and messaging applications is a trend taking place globally. Venmo was the first platform to integrate both technologies natively in the U.S. Also, Facebook has opened its Messenger app up to payments. In China, companies like Tencent and Alibaba have rapidly driven the country towards becoming a cashless society. Safaricom plans for Bonga to grow its market share globally, beginning with the 10 countries where the M-Pesa app is available across Africa, Europe and Southeast Asia. Read More