By Alec Hogg

In today’s global business news headlines:

• The International Monetary Fund yesterday cut its forecast for South Africa’s economic growth in 2019 to a pedestrian 1.2% and a modest 1.5% in 2020, both down 0.2% from projections made six months ago. It ascribes the drop to “modestly reduced but continued policy uncertainty after the May 2019 election.” The downgrade was in line with a generally pessimistic tone in the IMF’s annual World Economic Outlook report released yesterday where the institution’s economists cut global economic growth to 3.3% from the 3.5% projection made in January and 3.7% last October. The IMF says falling global growth is a result of trade tensions between the US and China; a fall in business confidence; tightening financial conditions and greater policy uncertainty across many economies.
• Debenhams, the 241-year-old British retailer whose initial boost came from dominating the sale of family mourning clothes during the strict Victorian era, yesterday attended to its own funeral. The company was put into bankruptcy administration as creditors took control of the operations. Its London Stock Exchange listed shares, worth almost £100 each three years ago, are now worthless. Creditors say the existing shares will be cancelled today and £100m in debt owed to them by the company will be converted into fresh equity to keep the operating businesses afloat. The news was greeted with fury by colourful entrepreneur Mike Ashley, whose 400-store Sports Direct will lose the £150m it paid to acquire 29% of Debenhams shares. Ashley had proposed a number of rescue plans, all of which required him to be installed as CEO. But creditors repeatedly rejected his plans. Ashley, a billionaire who left school at 16, is best known for his ownership of Newcastle United football club. Last year he bought another venerable but bankrupted department store retailer, House of Fraser.
• One of the world’s big three rating agencies S&P yesterday left South Africa’s credit score unchanged at two levels below investment grade. It set a stable outlook on expectations the ANC will continue with policy reforms after the May 8 election. S&P analyst Garnder Rusike said the best case scenario for the country would be for the ANC to win the election and continue with economic restructuring it has started. In response, SA president Cyril Ramaphosa told wine farmers in Stellenbosch he was disappointed that S&P did not upgrade the rating but predicted the agency would have reason to do so soon.
• South African share prices lost a little ground yesterday with the JSE’s overall index closing a quarter percent lower. It was dragged down by a 4% drop in the price of heavyweight Richemont after analysts at Credit Suisse downgraded the stock to “underperform”. The analysts are negative on Cartier jewellery, which delivers 54% of Richemont’s profit, and cautioned that Chinese demand for luxury goods is also falling. Credit Suisse has set a target price for Richemont at 8.5% below yesterday’s closing price. At the other end, Brimstone’s share price jumped 17% after traders absorbed the benefits to it from Tiger’s unbundling of Oceana, with chemicals group Omnia another feature with a 6% gain. Retailers Mr Price and Shoprite rose just under 3% and Spar by 1.3% after yesterday’s solid trading statement from competitor Pick n Pay. Pharma group Aspen broke a losing streak with a 1.5% rebound.