Today's News - Monday 30 November 2020
Our Backyard
The Chinese Government has announced it will place tariffs on all Australian wine imports from Saturday, striking a blow to the $1.2 billion-a-year industry.
It follows the preliminary findings of a Chinese anti-dumping investigation into Australia's wine exports that found that dumping exists and causes Chinese winemakers "substantial harm".
The investigation is not due to finish until next year, but China's Commerce Ministry announced that from November 28, importers of Australian wine entering China will need to pay temporary "anti-dumping security deposits".
The deposits, which effectively work like tariffs, will range from between 107 per cent to more than 200 per cent.
https://www.abc.net.au/news/2020-11-27/china-puts-tariffs-on-australian-wine-trade-tensions/12886700
Treasury Wine Estates boss Tim Ford is on Monday expected to reveal his strategy to replace more than $500m in sales snuffed out by China’s decision to erect a high tariff wall against Australian wine.
The winemaker plans to redirect much of the premium wine once shipped to Chinese ports to markets in North America, North Asia and Europe.
But it could come with potential redundancy and restructuring costs for its sprawling Chinese operations if Mr Ford decides to put the China business into hibernation until the dire relations between Canberra and Beijing improve.
The winemaker is also believed to operate a number of short-term contracts with growers, so it can quickly reduce the volume of grapes it is contracted to buy, easing financial pressure on the group.
Treasury Wines is pinning its hopes on being able to reallocate as much as 40 per cent of the wine typically exported to China to other countries including Japan, Hong Kong, Britain and the US, though this would mainly be for prestige labels such as Penfolds rather than its long tail of cheap commercial wine such as Rawson’s Retreat.
The $800bn retail payments market is set for a watershed 2021 as three key bodies mull a merger, and separate reviews are conducted by Treasury and the central bank across infrastructure, policy and technology.
The Treasury and Reserve Bank’s concurrent payments reviews come against the backdrop of controversial merger talks — which started in June — between BPAY, eftpos and the real-time New Payments Platform.
The three-way consolidation, which some believe will dent competition and investment across the payment platforms, is being discussed by the 22 shareholders of the three organisations — in a process that could take nine months.
An industry committee, including representatives from the big banks, is assessing issues of ownership, structure and corporate governance, and representatives from the NPP have met with the competition regulator on the proposal.
It is thought several banks are supportive of the tie-up between BPAY, eftpos and the NPP as it allows them to pool their investments, while retail stakeholders have concerns the marriage will reduce competition.
A leading investment bank has concluded that share buybacks by the major banks are unlikely in 2021, despite the sector holding about $20bn in surplus capital.
Morgan Stanley said in a note that investor attention had turned to the possibility of buybacks after some bullish recent commentary by chief executives on the outlook.
This came as bank common equity tier one ratios were comfortably above the “unquestionably strong” benchmark of 10.5 per cent.
CBA was the best capitalised of the majors, holding $9.1bn more than the regulatory minimum, $8bn above a CET1 of 10.75 per cent, and $6.9bn above an 11 per cent target. ANZ was the laggard, with $3bn in excess of 10.5 per cent, $1.9bn above 10.75 per cent, and $900m above 11 per cent.
Up to 70 students from China, Hong Kong, Japan, Vietnam, and Indonesia are scheduled to arrive at Darwin International Airport at 7:20am on Monday, marking the first time international students have been allowed into the country since March 20.
The ABC understands all the students will be transferred directly from the airport to Howard Springs Quarantine Facility — a former workers' camp near Darwin — to begin 14 days of quarantine.
A consortium of unions have lost an appeal in the Federal Court to have Qantas pay sick leave to the 25,000 workers who were temporarily stood down due to COVID-19.
In May, the Federal Court agreed Qantas staff could not access paid compassionate, personal or carer's leave because there was no work for them to be absent from.
The court ruled if Qantas were required to pay leave entitlements after lawfully standing down its workers, that would defeat the purpose of having the staff furloughed in the first place.
The appeal case was backed by several unions, including the Transport Workers' Union and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia.
On Friday, two of three Federal Court justices dismissed the appeal.
In their joint decision, Justice Steven Rares and Justice Craig Colvin said under the terms of the enterprise agreement, being stood down means an employee is not required to present for work, and therefore cannot take leave "because … there is no obligation to present for work from which leave may be taken".
The justices agreed that allowing workers to be paid for taking time off work during a period where there was no work "would be somewhat paradoxical".
A new report has found a majority of businesses across the Asia Pacific are actively reducing their reliance on China in their supply chains.
The latest Asia Pacific CEO survey, conducted by Westpac’s institutional arm, found a number or large corporations in the region had or were planning to bring manufacturing back to domestic operations to minimise risks within supply chains.
Surveying 113 chief executives, the report found two-thirds of firms had experienced significant supply disruptions during the coronavirus pandemic, and more than half had decided to manufacture onshore.
The mortgage broker channel has recorded its highest ever market share result with brokers settling 60.1 per cent of all residential home loans during the July-September 2020 quarter, according to new data.
The figures come in the latest data released by research group comparator, a CoreLogic business, which was commissioned by the Mortgage & Finance Association of Australia (MFAA).
The September 2020 result is 5.2 percentage points higher than the equivalent 2019 quarter, 1.0 percentage point higher than the equivalent 2018 quarter, and 0.4 of a percentage point higher than the previous market share record of 59.7 per cent set in March 2019.
As well as breaking a market share record, the value of new settlements recorded in the September 2020 quarter is also the largest by dollar value ever observed.
The top 18 aggregators settled $57.47 billion of new home loans, the report found.
https://www.theadviser.com.au/breaking-news/41061-broker-market-share-surpasses-60
Victoria will ban all school banking programs, including the Commonwealth Bank's well-known Dollarmites, following ongoing concerns banks and financial institutions were using inappropriate tactics to lure children and promote credit cards.
Leading consumer group Choice is now calling for other states to follow Victoria's lead and outlaw the controversial school financial literacy programs.
School banking has been hit with a series of scandals in recent years. This has included an expose by The Age and Sydney Morning Herald in 2018 that CBA staff had fraudulently set up thousands of accounts in the names of children without parental consent to claim bonuses.
Victorian Minister for Education James Merlino announced the ban on Sunday, saying the Victorian school curriculum included financial literacy.
Victorians who are drunk in public will no longer be incarcerated and police should play as little a role in their treatment as possible under recommendations for new laws aimed at decriminalising public drunkenness in Victoria.
A government-commissioned report recommends "safe places" be set up that include first-response medical staff and equipment, culturally appropriate processes, sobering services for long-term recovery and transport options that only involve police when there are no other options available.
Victoria and Queensland are the only Australian states or territories that consider public drunkenness an offence. Aboriginal communities, which are disproportionately affected by the current laws, have advocated for reform for decades.
The report was handed to Attorney-General Jill Hennessy on Friday. The Victorian government says it will introduce changes – first discussed by the Royal Commission into Aboriginal Deaths in Custody 30 years ago – to Parliament before the end of the year, with new laws to be active within two years.
Australia’s gamers trumped Netflix subscribers as the biggest users of the internet during the coronavirus pandemic, or at least that's what major telco providers Telstra and Optus are saying after seeing their respective networks stretched to the limit.
At the height of the pandemic as Australia went into lockdown and sports matches were cancelled the amount of bandwidth required to run games such as Fortnite and League of Legends was so large that it prompted a letter from Communications Minister Paul Fletcher in March, asking the gaming platforms to help NBN Co manage high consumer demand.
The Australian gaming industry was the fastest growing sector in PwC’s 2020 media and entertainment outlook and is worth $4 billion this year, compared to $3.2 billion the previous year. PwC says most of this growth has come on the back of people staying at home in lockdown during the pandemic without the ability to watch sport.
In an attempt to latch onto this growing sector, Optus announced in October it would launch a product called Game Path, which can be added onto an existing NBN contract for $10 a month. The tool reduces lag in games and provides a better internet connection by finding the best path to a gaming server.
Meanwhile, Telstra last week announced its own $10 add-on to its NBN customers - a "Game Optimiser" that can help reduce lag spikes and join multiplayer servers that are closer to their house.
Capital city car parking occupancies have recovered “spasmodically” since the height of the pandemic, but Melbourne’s lots remain largely vacant and steep discounting means improved patronage is not translating into revenue gains for the battle-scarred sector.
Parking Australia estimates that Sydney’s CBD has returned to 75 per cent occupancy and Brisbane’s car parks are 85 per cent full.
Chief executive Stuart Norman said: "But competition is quite fierce and that is keeping prices down.''
The country’s biggest private operator, Wilson Parking, reports its national occupancy levels are back to 90 per cent in its 180,000 spaces, after falling to an average 30 per cent at the height of the lockdowns.
Public transport fares could rise in the new year, with patronage across Queensland’s south-east still down by a third.
TransLink increased fares in 2019 and 2020, and a spokesman for the state's transport minister said the decision about whether to do the same in early 2021 was "yet to be made", around mid-December.
About the same time, a new app will be introduced to inform travellers about capacity on the state's public transport network in a bid to spread commuters out.
With more people heading back to the office after spending large chunks of 2020 working from home, the challenges of maintaining social distancing on public transport have become trickier.
Newcastle politicians have told a NSW inquiry into grants programs that a “bizarre” set of rules make it essentially impossible for their city to receive certain types of funding.
That’s because they fall between the cracks when it comes to the definitions of “metropolitan” versus “regional”, Newcastle Mayor Nuatali Nelmes said.
“It is very peculiar just to the local government boundaries of the City of Newcastle. Because we’re often classified as either metropolitan in some rounds or regional in some rounds.
“Funding can often be quite a bit easier for our neighbours to attract. It can be very difficult due to the classification and some of the boundaries around funding programs.”
Firefighters are warning that weather conditions will continue to fan flames as they battle a massive out-of-control blaze on Queensland’s Fraser Island.
The fire, which has been burning for a month-and-a-half, is closing in on two tourist attractions.
The Queensland Fire and Emergency Service said on Sunday the fire was five kilometres from the Kingfisher Bay Resort, which has temporarily closed its doors, on the island’s western beach.
Another fire front was just two kilometres from the Cathedrals camping ground on the other side of the island.
World News
Iran's supreme leader has promised to retaliate for the killing of the Islamic Republic's top nuclear scientist, raising the threat of a new confrontation with the West and Israel.
The country's Supreme Leader, Ayatollah Ali Khamenei, pledged to continue the work of Mohsen Fakhrizadeh, who Western and Israeli Governments believe was the architect of a secret Iranian program to make nuclear weapons.
The Ayatollah called for the "definitive punishment" of those behind the killing.
Israel, long suspected of killing Iranian scientists a decade ago amid tensions over Tehran's nuclear program, has yet to comment on the killing.
Ethiopian Prime Minister Abiy Ahmed says a military offensive in the nation's the Tigray region is complete and federal troops control the regional capital, a major development in a three-week-old war that has shaken the Horn of Africa.
Less than an hour earlier, he said in a statement: "The Federal Government is now fully in control of the city of Mekelle."
Claims from all sides are difficult to verify because phone and internet links to the region have been down and access tightly controlled since fighting began.
Black-clad protesters have clashed with security forces at the end of a demonstration against police violence in Paris.
It came after masked protesters launched fireworks at police lines, put up barricades and threw stones.
The interior ministry said there were 46,000 protesters in Paris.
The majority of the thousands of demonstrators marched peacefully, but small groups of protesters smashed shop windows and set two cars, a motorcycle and a cafe on fire. The fires were put out quickly.
Having reinstated federal capital punishment the Trump administration is scrambling to expand the number of ways that the federal government can execute prisoners before the president leaves office in January.
The default method is lethal injection unless a judge specifically orders otherwise but under a rule scheduled to take effect next month, death by firing squad and by electrocution are among the extra methods that will be permitted.
The proposal brings federal executions into line with the varied means available to executioners in individual states, such as Alabama, where prisoners can elect to be killed by electrocution or nitrogen hypoxia (a lethal gas dose) instead of by deadly injection.
In Utah a 2015 law states that a firing squad shall be deployed to carry out executions if the substances required for a lethal injection are unavailable.
The US state of Pennsylvania’s supreme court dismissed another legal challenge to the election by supporters of President Donald Trump on Saturday night (Sunday AEDT), further reducing his already near-impossible odds of overturning the results.
A Republican lawsuit had sought to invalidate mail-in ballots in the battleground state that president-elect Joe Biden won by about 81,000 votes — or to throw out all votes and allow the state’s legislature to decide the winner.
The court dismissed both claims in a unanimous decision on Saturday night, calling the second one an “extraordinary proposition that the court disen-franchise all 6.9 million Pennsyl-vanians who voted in the general election”.
China has live streamed footage of its new manned submersible parked at the bottom of the Mariana Trench as part of a historic mission into the deepest underwater valley on the planet.
The Fendouzhe, or Striver, descended more than 10,000 metres into the submarine trench in the western Pacific Ocean with three researchers on board, state broadcaster CCTV said.
Only a handful of people have ever visited the bottom of the Mariana Trench, a crescent-shaped depression in the Earth's crust that is deeper than Mount Everest is high and more than 2,550 kilometres long.
The first explorers visited the trench in 1960 on a brief expedition, after which there had been no missions until Hollywood director James Cameron made the first solo trip to the bottom in 2012.
At least three people have been killed by flooding on the Italian island of Sardinia, according to authorities and local media.
In Bitti, a town in the province of Nuoro, streets were turned into rivers of mud which covered cars and flooded cellars.
https://www.abc.net.au/news/2020-11-29/sardinia-flooding-kills-at-least-three-people/12932378
Weeks before the coronavirus pandemic swept across Europe in February, some of the first virus clusters on the Continent appeared in ski resorts in the Alps, leading to cascading outbreaks as winter sports enthusiasts returned home.
Now, with the Christmas holiday season in sight, leaders in France, Germany and Italy indicated this week that ski slopes would remain closed at least until the end of the year. The move reflects the leaders' wariness of repeating the waves of infections fulled by negligence in the early days and relaxed restrictions over the northern summer.
Yet with Austria and Switzerland vowing to reopen their resorts, a high-altitude rivalry is once again putting to the test attempts by European countries to coordinate their response to the pandemic when it comes to tourism.
European nations have for months struggled to adopt a unified response, each imposing its own restrictions. And while many imposed new lockdowns this month, some, like France, are easing restrictions before Christmas. Poland and Hungary also blocked a landmark agreement forged by the European Union to raise a €750 billion euro ($1.2 billion) relief fund.
European tourism has been hit hard by the pandemic, with up to 11.5 million jobs in the sector at risk, according to the European Commission, the EU's executive arm. https://www.smh.com.au/world/europe/to-open-or-not-to-open-ski-slopes-chilling-question-divides-europe-20201128-p56irq.html
Covid-19
Health authorities have issued an urgent plea for those who visited an Adelaide university to immediately quarantine and get tested as soon as possible.
Flinders University Sturt Campus in the city’s southern suburbs is the latest site to be declared a coronavirus risk zone by contract tracers from South Australia Health.
Anyone who visited the campus in Bedford Park between November 13 and November 28 may have come in contact with the deadly virus.
Western Australians eager to travel to Victoria without quarantining and vice versa will have to wait a while longer with WA Premier Mark McGowan revealing he would not make a decision on whether to open the controlled border between the states until 'early [this] week'.
This is despite Victoria having reached the milestone of 28 days without community transmission of COVID-19 that was previously flagged as the trigger to remove quarantine requirements.
A new state government-funded contact-tracing app should be available to Victorians as soon as next week, providing a universal check-in method for venues via QR codes.
The app is being launched by Service Victoria and was custom built by Melbourne startup Two Bulls.
A variety of businesses will be targeted to use the app, including cafes, restaurants, bars, shops, cinemas, gyms, sporting venues and theatres, but it is not expected to be mandatory.
Instead, the government will encourage voluntary take-up from small stores all the way through to large venues, including the Princess Theatre and the Melbourne Cricket Ground.
A NSW mum has raked in more than $50,000 after inventing a COVID-19 killing spray that sold out in less than six hours.
Southern Highlands mother of four Sophie Westlake used her science background to kickstart an all-Australian-made coronavirus killing disinfectant known as Virosol after coming to the realisation there was a lack of retail cleaning products that could combat the disease.
Virosol is the second product available in Australia that has been approved by the Therapeutic Goods Administration (TGA) for household use to kill COVID-19.
The TGA approval means a product can publicly advertise that it kills specific germs and diseases.
A COVID-19 vaccine could be rolled out in the UK within days, with reports approval of the jab is imminent.
UK authorities are on the brink of approving the coronavirus vaccine developed by BioNTech and Pfizer, with the Financial Times revealing deliveries of the shot could begin just hours after approval.
The publication also reported the first injections could take place from December 7, just eight days away.
In the UK, vaccines usually have to be authorised by the European Medicines Agency until the Brexit transition is complete on December 31, but this could be temporarily overridden by the Medicines and Healthcare Products Regulatory Agency in urgent cases.
The BioNTech and Pfizer vaccine has been found to have an efficacy rate of more than 95 per cent after two shots of the vaccine.
The high-profile epidemiologist who led Sweden's no-lockdown strategy in the spring appears to be being sidelined by the government after his prediction that greater immunity would mean a lighter second wave proved badly wrong.
On Thursday Anders Tegnell's biweekly press conference was pushed into the shade by an overlapping press conference fronted by Swedish Prime Minister Stefan Lofven at which scenarios prepared by the Public Health Agency were announced.
Dr Tegnell had always insisted that his Public Health Agency had never pursued a herd immunity strategy, but he repeatedly suggested in the summer that his counterparts in Norway, Finland and Denmark would face a tougher task over the winter because of lower levels of immunity in their populations.
This month, however, the number of deaths in Sweden had again begun to soar above those of its Nordic neighbours, with 630 deaths registered as a result of COVID-19. That was about 10 times the per-capita death rate of Norway, where just 30 COVID-19 deaths were registered between October 28 and November 25.
An Indian man who was falsely declared dead from COVID-19 recovered and went home — but his family had cremated someone else.
Shibdas Bandyopadhyay, 75, was admitted to a hospital in Barasat on Nov. 11 after testing positive for the virus, and two days later, his family was informed he had died, The New Indian Express reported Saturday.
Bandyopadhyay’s family saw what they thought was his body wrapped in plastic but couldn’t see his face clearly.
Property
The HomeBuilder scheme currently provides $25,000 grants to eligible people building a new home or renovating an existing one.
It had been due to expire at the end of the year but will be extended to 31 March, 2021, at the lower rate of $15,000.
Prime Minister Scott Morrison said the extension was expected to lead to another 15,000 construction projects, bringing the total anticipated renovations or builds under the program to 42,000.
A surge in first home buyers is set to fuel house price hikes, with the Real Estate Institute of Queensland (REIQ) tipping property values will "increase dramatically" in 2021.
It follows a 40 per cent surge in first home buyers entering the Queensland property market in September and predictions of a nationwide property boom.
REIQ corporate affairs manager Olivier Bleylock said suggestions of a 25 per cent increase in interstate migration to Queensland next year would put further upward pressure on the cost of housing.
"The Gold Coast has seen an annual growth of 3.2 per cent year on year for housing," Mr Bleylock said.
Gold Coast suburb of Clear Island Waters, values have jumped 11.3 per cent year-on-year.
Home loans for first home buyers across Queensland skyrocketed 41 per cent in September.
The company behind some of Australia’s most iconic buildings owes creditors about $60 million but could be saved from the brink if its legal battle over the Central Barangaroo project in Sydney is successful.
Office tower and residential apartment builder Grocon announced last week it would reluctantly appoint administrators, 66 years after the private group was founded by chief executive Daniel Grollo’s grandfather Luigi.
Grocon alleges rival Lendlease and Crown Resorts reached a secret deal with the state government on building heights last year, protecting the rights of Crown Towers – now Sydney’s tallest building – to unobstructed views of the harbour.
That killed off Grocon’s plans to build smaller commercial and residential towers nearby.
Grocon is seeking compensation for lost profits in the project that could be anything between $60 million and $270 million.
If successful, creditors would be paid in full, Mr Grollo said, and the companies could be revived.
https://www.dhirubhai.net/in/dr-andrew-wilson-79b70058/detail/recent-activity/
Markets
The sales process for Toll’s $3.5bn Express division has officially kicked off and the contest is shaping up to be a battle between private equity funds.
DataRoom understands that among the groups lining up for the business are Pacific Equity Partners, BGH Capital and Anchorage Capital Partners.
The successful buyer will no doubt have its work cut out when it comes to turning the division into a strong performer, but it could pay major dividends for any group willing to steel itself for the challenge.
The first round bids are due before the end of the year in the sales process run by Nomura and JPMorgan.
All of the major private equity funds, such as Kohlberg Kravis Roberts, Brookfield, Blackstone and Carlyle and TPG Capital, have been sent documents for the sales process. Some think the contest will boil down to bidders that are either industry competitors or private equity firms more focused on turnaround opportunities.
Float candidate Liberty Financial has signalled it plans to join the ASX as a $1.8bn company next month and pay an unfranked dividend in July, as it shrugged off other companies’ listing jitters.
The non-bank lending group is targeting a dividend payout ratio of between 40 per cent and 80 per cent of expected net profit, -according to a prospectus released on Friday.
Liberty’s shares are scheduled to start trading on December 15, on a deferred settlement basis.
The company’s prospectus comes after other initial public -offering candidates abandoned plans to list this week, largely on the back of weak investor interest. They included Fantastic Furniture and law firm HWL Ebsworth.
Law firm HWL Ebsworth has abandoned plans for its initial public offering, according to sources.
It is understood the company was in search of an additional $25m before opting to walk away from the deal on Thursday night.
The group, which was to be renamed Alarcon when listed, had already recut its terms to make itself more appealing to prospective investors.
The investors were understood to have been deterred from participating in the prospective float due to the fact that it plans to list with a $232.5m debt pile.
Sources said the investors sidestepped the deal due to concerns the debt would be used to pay partners a major pre-IPO dividend. They also expressed caution about the lack of clarity around the old and new models of partner remuneration, and they lacked conviction about the strength of the firm’s management.
On Friday Australian shares ended their day lower after China announced it would impose crippling tariffs on Australian wine imports from tomorrow.
The benchmark ASX 200 lost 35 points (-0.5pc) to close at 6,601, its second consecutive day of losses.
Despite that, the market has notched a four-week winning streak, and has surged 11.4 per cent since the month began.
By 5:45pm AEDT, the Australian dollar had risen to 73.78 US cents.
Spot gold has slipped (-0.1pc) to $US1,808.50 an ounce, while Brent crude oil was flat at $US47.84 a barrel.
Several of [Friday’s] best performers were gold miners like Perseus Mining (+3.1pc), Gold Road Resources (+2pc) and Evolution Mining (+2pc).
Meanwhile, Bega Cheese surged (+8.9pc), after emerging from a four-day trading halt.
The company raised $284 million from an institutional capital raising to fund its takeover of Lion Dairy & Drinks — a deal worth $560 million.
Travel and energy stocks suffered heavy losses, like Webjet (-3.2pc), Flight Centre (-2.9pc), Oil Search (-3.7pc) and Beach Energy (-3.8pc).
Banks and miners were the biggest drag on the market, including Westpac (-0.9pc), ANZ (-0.7pc), BHP (-1.3pc) and Rio Tinto (-0.8pc).
Shares in Australia's biggest wine company, Treasury Wine Estates (TWE), have gone into a sudden trading halt, after a staggering 11.3 per cent plunge.
The company is perhaps better known for its brands Penfolds, Wolf Blass and Lindeman's.
The company that owns Radio Rentals shops and services that lease products and loan money to largely low-income clients has reported yet another half-yearly loss.
Thorn Group posted a net loss of $1.1 million. That followed a $25.6 million loss in the same period last year.
Its share price fell (-3.2pc) to 15 cents.