Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Interest in self-driving cars has gone up a gear thanks to Tesla’s recent much-hyped robotaxi event. Chinese autonomous driving firm Horizon Robotics has chosen a good time to raise funds in a Hong Kong listing. If it reaches its target of raising up to $696mn, it would be the city’s largest initial public offering this year.
The company, backed by Intel and Volkswagen, will sell 1.36bn shares. This would make the listing bigger than China Resources Beverage. Before Horizon’s announcement, this soft drinks company had been on track to hold the city’s biggest new share sale this year after it started bookbuilding on Tuesday.
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In Hong Kong, having multiple large listings in close succession has frequently meant more scattered funds from retail investors and less demand for companies that are not well-known household names. For Horizon, that should be less of an issue as it has already received significant interest from corporate investors. Cornerstone investors for the Horizon stock offering include the online business software unit of Alibaba Group and Chinese internet search giant Baidu.
There are good reasons for the interest. Horizon manufactures advanced driver assistance systems and autonomous driving solutions for passenger vehicles in China. Unlike some self-driving and software start-ups that have yet to build a viable product or business model, Horizon has already supplied customers including Volkswagen’s Audi, Continental, BYD, Li Auto and SAIC. Volkswagen has invested in developing technology to integrate autonomous driving-related functions on to a single chip along with Horizon since 2022. Proceeds raised in the listing will be used for research and development as well as sales and marketing.
Autonomous driving technology, especially fully self-driving cars, have been the topic of much debate. True, the commercialisation and mass production of driverless cars are likely to be many years in the future. But that does not necessarily mean it will take that much time to get individual autonomous driving functions — still requiring driver supervision — into today’s cars as lucrative add-ons.
Autonomous driving technologies use software, radars, lidar sensors and cameras to enhance safety and convenience for drivers. For example, the level of technology today can alert drivers to obstacles, help avoid collisions and assist in parking and lane centring — all of which carmakers can monetise through premium features.
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Hong Kong’s deflated listings market could do with the kind of hype that self-driving cars are generating. But a successful Horizon IPO should at least provide another much-needed boost to shift it out of the slow lane.
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
The writer is chief economist and senior vice-president for development economics at the World Bank
You may scoff at the idea that Nigeria just might be on the cusp of turning its economic fortunes around. Since the 1980s, when oil prices collapsed, the country has been mired in one crisis after another. But now the largest economy in sub-Saharan Africa is at a turning point.
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Over the past year or so, the Nigerian government has implemented major, politically difficult reforms. No large-scale reform process is ever perfect, but this one must be allowed to succeed — Africa’s future hinges on its success. An economic turnaround in a country with more people in poverty than almost any other would be a game-changer for market-orientated reforms across the continent.
Consider the scale of the reforms implemented so far. Nigeria now has a market-determined exchange rate, having unified official and parallel exchange rates. Previously, the government had been losing the equivalent of 38 cents for every $1 of government oil export proceeds. This benefited some local elites, who acquired dollars cheaply at the government’s expense. The unification also got rid of a hefty implicit tax on agricultural and manufactured exports.
Costly and regressive petrol subsidies are also being cut. This will help to strengthen Nigeria’s historically shaky public finances and restore the naira as a credible currency.
Implementing such far-reaching change is impossible without political commitment from the top. The price of petrol in Nigeria has quintupled since the subsidy cuts, imposing terrible hardship across society. To boost confidence in the naira and anchor inflation expectations, the central bank has had to raise its policy rate by 850 basis points in the last nine months. Central-bank financing of fiscal deficits has finally ended.
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Yet the hard part has only just begun. Nigeria will need to stay the course if it is to become an engine of growth in Sub-Saharan Africa. Although the historical record isn’t encouraging — previous reforms have been rolled back by the elite — policymakers will need to focus on three critical areas in particular.
First, they should prioritise non-oil growth. This requires a competitive exchange rate, which Nigeria now has. To protect the poor and maintain competitiveness, the central bank must maintain its focus on inflation. It should resist the lure of volatile short-term capital inflows that might push up the naira’s value too quickly and stifle non-oil growth in the process. And it should rebuild foreign-exchange reserves as a cushion against oil-price and exchange-rate volatility.
Second, Nigeria must help vulnerable households cope with inflation, which is still high. The government is rolling out a large-scale targeted, temporary cash transfer programme. It should also establish a cost-effective safety net to protect the most vulnerable.
The third and final priority is to establish a climate in which private businesses can flourish. Nigeria’s need for jobs is immense. Today, less than 14 per cent of working Nigerians enjoy a predictable, fixed wage. In the next 10 years, the number of Nigerians entering the workforce is set to increase by more than 12mn. Generating the requisite number of good jobs will depend on sparking large-scale domestic and foreign private investment in the non-oil sector.
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Nigeria’s government deserves the world’s support in this endeavour. Failure in Nigeria would set back the cause of reform across Africa, besides ruining the prospects of yet another generation of young Nigerians. The country’s elites must forge a political consensus in support of these reforms, because their long-term interests lie in a broadly prosperous and stable society. For its part, the international community should do everything in its power to help the government succeed.
Last week you joined us in London for Money Marketing Interactive London and what a day it was!
A huge thank you to all our incredible delegates. Your energy and participation made this year’s conference unforgettable. We’re excited to see how you’ll take the knowledge shared and continue shaping the future of financial advice.
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
More than 100 people have been killed in Nigeria after they rushed to scoop up petrol from a tanker that overturned and then caught fire, police said on Wednesday, as the country’s citizens struggle with a surge in fuel prices.
The incident was the latest fatal tanker explosion in Nigeria, where petrol and other fuels are transported in lorries over long distances and often on poorly maintained roads.
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The accident took place late on Tuesday in the town of Majia in northern Jigawa state, nearly 600km from the capital Abuja. Lawal Shiisu Adam, the state’s police spokesperson, said the tanker had been ferrying fuel from Kano, the economic capital of northern Nigeria, to Yobe state via Jigawa when the driver “lost control” of the tanker.
Adam said police had cordoned off the area after the crash but were soon overwhelmed by a crowd who rushed to collect spilled fuel. Videos posted on social media showed a fiery inferno, which also left scores of people injured.
Fuel prices have increased nearly fivefold over the past year following the government’s decision to cut fuel subsidies and a slide in the naira currency, which has lost about 70 per cent of its value against the dollar since June.
Nigeria’s state-owned oil company last week increased petrol prices by more than 15 per cent, marking the second rise in less than a month and the formal end of a costly subsidy programme.
In the absence of an efficient rail network to move goods across the vast nation, fuel is usually transported in tankers over long distances by road. The country has an under-developed road network that is patchy in many areas and traffic rules are not strictly followed or enforced.
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Accidents involving fuel transportation in Africa’s most populous nation are frequent, with Nigerians often rushing to accident scenes to salvage fuel in buckets and other containers from the tankers.
Last month, almost 60 people died after a collision between a fuel tanker and a truck containing passengers and cattle in north-central Niger state. Nigeria’s road safety agency reported that more than 5,000 people were killed in road crashes last year, but the World Health Organization estimated the number at closer to 40,000, arguing that many accidents are not reported to authorities.
Africa accounts for 19 per cent of road traffic deaths despite having 15 per cent of the global population and only 3 per cent of the world’s vehicle fleet, according to WHO data.
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Sani Umar, a resident who escaped the fire, was quoted by the local Channels TV that the episode was “terrifying”.
Umar added: “People were running in all directions, screaming for help. The fire spread so quickly that many couldn’t escape.”
AS temperatures drop, many homeowners will be starting to notice condensation gathering on window sills and surfaces around their homes.
Condensation can lead to stubborn mould growing in your home, which is an expensive problem to get rid of if left untreated and is also bad for your health.
But some houseplants can act as natural dehumidifiers by absorbing this moisture – and even better, they are cheap to buy and have no running cost.
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Plants that are great at tackling humid environments include Snake Plants, Peace Lilies, Orchids, English Ivy and Bamboo Palms.
These plants absorb water from their surroundings through their leaves and release the moisture back out through transpiration.
They also improve the quality and smell of the air in your home by removing airborne mould spores.
Other palm plants include Areca Palms, Lady Palms, Dwarf Date Palms and Reed Palms.
You can buy an Areca Palm for £12 from Gardening Express.
Snake Plant
Snake plants grow best in areas with low light or without a window – which means they’re ideal for places like the bathroom which are prone to getting damp.
You can buy one from B&Q for £14.99 or even cheaper at Homebase for £10.
Orchid
Orchids aren’t just pretty to have around the house – they also work hard to keep air clean and healthy.
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They reduce humidity in the home and require very little upkeep and maintenance on your end.
You can purchase an orchid for £10 in B&Q or £9 in Ikea.
The cheapest offer around is at Homebase where they are currently reduced from £11 to £5.50.
What is mould and how to get rid of it?
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Mould is more likely to grow during the winter months.
Olivia Young, Product Development Scientist at Astonish revealed exactly why this is.
“Unfortunately, mould is a common problem many people face during winter. It thrives in conditions that are warm and damp, so your bathrooms are likely to be the most affected place.
“That said, during the colder months most rooms in your home could be vulnerable to mould growing.
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“This occurs primarily from condensation that builds up on your windows when you’ve got your radiators on.
“If you think about it, when windows and doors are closed, there’s not much chance for the air to circulate and the moisture to make a swift exit.
“This build up is what can cause dreaded mould to make an appearance, especially in bathrooms, as it creates that warm and wet environment that is a breeding ground for mould.
“If left untreated, not only is it unsightly but it can also pose a serious risk to your health, so it’s really important you treat it.
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“The key to tackle mould is to act fast.
“Try to come into as little contact with it as you can. So, grab your gloves, tie up your hair and get to work to remove any signs of mould as soon as you notice them.
“To keep mould at bay, there are some simple solutions you can introduce throughout home.
“The first is keep it ventilated. Yes, even in the cold winter months try to leave your bathroom window open for at least 10/15 minutes post shower or bath. This will get rid of any excess moisture quickly preventing mould gathering.
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“If you’re having a repeat problem with mould in one particular area, it might be because the humidity levels are too high. You can get a dehumidifier that will help keep the levels low and reduce the risk of mould returning.
“The golden rule to remember when dealing with mould is the quicker you can treat it, the better. If you leave it, it will only get worse so never ignore it!
“To successfully get rid of mould every time, I recommend opting for the UK’s No 1 Mould & Mildew Remover, that effectively removes mould and mildew stains almost instantly, with no scrubbing necessary.”
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