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tv   Counting the Cost 2019 Ep 30  Al Jazeera  July 30, 2019 8:33am-9:01am +03

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it's about the bahraini government. they told me you're a member of al qaeda you can stop as of this year. and it's with al qaida to conspire against the sas in. opposition to 20. playing with fire on al jazeera. hello i'm adrian finighan this is counting the cost when i was in your weekly look at the world of business and economics this week south africa's debt laden companies are too big to fail without a bailout could cripple the economy. from paul mccartney to taylor swift we say can look at the decades old struggle by artists to control their work. and job seekers in iraq only they're not iraqis we find out how us sanctions against iran are
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forcing people to cross the border in the hunt for jobs. south africa has a problem some of its biggest state owned companies pose a threat to the economy due to the huge debts chief executives have resigned frustrated by red tape or have been fired due to corruption and president still run oppose the recently won another term with the help of powerful unions has shelved plans to fix problem companies now if the state was to step in to bail out 2 of the biggest firms power company eskom imports operator transnet government debt would shoot up from 57 percent to 68 percent of g.d.p. escolar said it doesn't need a 3rd of its $48000.00 employees and for unions and ram opposed the that's a problem south africa's unemployment rate is at 27 percent with or without a bailout power blackouts in march were behind south africa's economy contract in the 1st 3 month. of the year eskom has been given an extra $4900000000.00 to keep
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operating and to pay down some of its debts trance that which runs the company's ports and rail freight is also at the center of numerous corruption allegations from overpaying for locomotives to paying advisory fees for non-existent businesses south african airways which employs $5700.00 people is another company that's been without a chief executive for the last few months in his resignation letter c o o. complained that his plans to turn around the last making airline were undermined by a lack of funding he'd requested $1500000000.00 well there's little prospect of the government allowing the big state firms to fail as that would damage the economy but right now a high profile commission is looking into alleged rampant state corruption presided over by former president jacob zuma al-jazeera has reports. presidents all wrong of course or came into office promising to fight corruption last year president jacob
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zuma resigned under a cloud of corruption scandals which will go down to government departments and officials the government has since set up a commission of inquiry to investigate those allegations well revelations around corruption at state owned companies have shocked south africans critics are concerned that the inquiry won't amount to any prosecutions with zuma at one point withdrawing from the inquiry saying he was under attack well run more poor so says corruption should be tackled the public protector a corruption watchdog accuse the president of lying to parliament about a $35000.00 campaign donation he received when he was running for president of the african national congress the president says the public protector's report is unfounded and is taking her to court meanwhile the public protector is there when kabbani is facing increasing criticism especially after the constitutional court in
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another case read that she'd lied under oath and go bonnie has been accused of undermining reporters fight against corruption and parliament has indicated it may investigate a competency for many south africans for straighted by the extent of corruption the fight against it appears to be overshadowed by the fight for power for many an unnecessary distraction the chairman of this comes board a job who testified at the commission of inquiry saying the power utility was the main theater we can rupture an in-state capture taken place much of this comes woes are related to a $42000000.00 payment to a coal company which was owned by the gupta family friends of jacob zuma the national energy regulator says political meddling and corruption as some. of the reasons that the power utility is in crisis is going to struggling with more than
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$31000000000.00 a day it needs government intervention to continue operating officials at state owned rail company transit of also being accused of corruption with employees they implicated in the payment of kickbacks and media reports say millions of dollars were paid on contracts that went to china south and china in north wales according to the bureau for research economic research undesigned must lead a ship south africa's economy lost $70000000000.00 analysts say under jacob zuma political decisions were made that negatively affected the economy the south african rand tanked and investors sold of 93000000 dollars worth of government bonds allegations of corruption have been made against government owned companies from the state broadcaster to the national airline now hoping to aid the fight against corruption a government units in sets up to include lifestyle towards of public officials
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ordered switch test whether the lifestyle of an employee is in line with their income while the president has made promises to turn things around many still wonder if there is a lack of political will specially given the extent to which the governing a.n.c. may be implicated from either miller counting the cost to him as well let's talk more about some of the challenges facing south africa right now joining us from london peter out i've been told peter is the head of capital markets research at south africa based in teletext good have you with us peter so south african airways exxon trans net many of south africa's state owned firms facing huge financial and management troubles just how much of a threat to they and others pose to south africa's economy and massive build up of financial stress of the state owned. enterprises and you can always tell when the back is about to stop when people stop paying wages and that's when finally things
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start happening normally in terms of bailouts in terms of hopefully some semblance of reform but each month now we have a number of an s.o.s. who are basically trying and then sometimes failing to pay wages in full and hence now we have money coming forward from the budget which is going to be bailing out a number of the us who is most notably as calm they've given an extra $26000000000.00 rand this year and a $3000000000.00 round next year just about $4900000000.00 in order to keep the show on the road and ensure their house going concern there in the old it is the sign of the accounts which will come out next week so a lot of these are so he's really right on the edge and requiring significant amounts of taxpayer support president rather poser wants to split into 3 given all that you've just said why does the not appears to be the political will to see that through well this is actually the point is it is it policy or not to do this on bundling into different entities it's certainly been
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a presidential proclamation from various speeches but actually it's not widely accepted across government even even within cabinets there are restrictions being put on this trying to redefine its meaning as basically ideological and also personality and ego battles come to the fore between different cabinet ministers and so that's really the worry here is we need to have movement on this unbundling is shown to work globally to help. energy companies and state electricity companies in distress and we need actual movement for that basically no other option apart from to do this and it will be further stressed further low setting for the blackouts that means to come i think before we really see movement on that front in the next year or so but these companies really too big to fail should the government therefore the taxpayer keep having to rescue them what about the option of privatizing them south african airlines for instance i mean surely that's right for privatization. what we have to split i think in the too big to fail argument
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has come on the one hand keeping the lights on member as calm is producing 90 percent of all interest in south africa is simply not an option not to having it fill out role that is too big to fail and hence political games ideological games can be played around it but none of the others i would say are too big to fail and say indeed should be allowed to go into business rescue basically insolvency process which would allow the best bits to be cherry picked off there is a certain amount of interest in some of the assets of essay by the private sector but setting as a whole the whole entity has a huge number of issues particularly on a technical department they said we don't know the number of you widgets and other things that they have to say much corruption over the years but there is some interest began the ideological blockages where some parts of government are happy for that to be the minority stakes in things like i say but not the majority of stakes that any particular strategic investor would really look for to have control to be able to turn around those entities by having management control but about the
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political will 57 percent at the moment of g.d.p. is is what south africa's debt is running as the government simply can't afford to keep rescuing these as we said we were when will reality bites so this is the fascinating thing we're working with investors on the moment and you know discussions with government and others as well is we're in a sort of very strange slow moving story and there are a number of reasons for this the 1st is there are exchange controls in place in south africa still one of the few countries really to restrict or developed market countries to to actually really restrict investors in what they can do so the large amount of capital trapped on shore that means people have to buy government bonds the equity markets underperform so much people are buying a lot of government bonds and also remember the lack of blackouts now since march as well has taken the pressure off slightly there those blackouts are likely to come back through the end of august probably into september so there has to. and so
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the weird mix of carbon is not forget as well with the federal reserve cutting about to cut rates the e.c.b. as well global market sentiment and the sort of pushback from markets as well as also being more muted maybe that would otherwise have been so this has allowed some breathing space but ultimately you know the end point is still inevitable because as we heard south africa's former president jacob zuma is giving evidence to the commission set up to investigate corruption allegations during his time in office the inquiry into state capture just how damaging has all of this been this process even for south africa and its economy so the zonda commission process is fascinating and has taken a long time is going to be going on probably for another year at least and then more time while they actually produce or unnatural reports and there's been a lot of criticism of the commission they have taken relatively easy lines on the knee of the witnesses that have appeared you know the process that has gone
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relatively slowly but that the zoomer appearance of all those on the commission was fascinating yet the general consensus rightly say was a lot of what he said was completely sort of you know out of kilter with reality and with the truth of what's happened in south africa but actually his purpose of appearing that was ultimately political and was focused within the a.n.c. and on those terms actually i think he was quite successful in terms of driving a wedge was his desire inside the party and so i think you have to treat him very carefully and ultimately a lot of this stuff is internally focused within the a.n.c. and that internal focus means that they can be distractions from dealing with some of the big issues the structural forms yes the easy great to talk to pieces many thanks for being with us and counting the cost. to our iraq imports $12000000000.00 worth of iranian gas and goods every year while baghdad has a 3 month waiver from washington to continue buying iranian exports that are concerns about the economic impact for both nations once sanctions kick in already
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. many iranian could cross in the border to find walk in northern iraq we have 2 reports for you in a moment asama been job it in baghdad on fears that ending imports could push up prices but 1st a touch of going to reports from a bill in the kurdish region where the common language makes it easier for a rainy and kurds to earn money for their families back home. each room shot from gardy wallpapers is bringing him closer to the day he can afford to marry his fiance the money he earns as a handyman in northern iraq is also supporting his parents at home in iran. how did it go it's been 5 years working in a hippy before this kind of work wasn't popular now there's more of a demand and business is getting better every 3 to 4 months i take a break and go back to iran because i have a work permit. but these iranian kurds aren't so lucky without work permits they enter the kurdish region in iraq on one month tourist visas work every day they can
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return home and repeat the process mohammad faruq says a lucrative month of work puts $800.00 in his pocket. i know it's very hard for me to be away from my family but it's hard not to have any money to spend all to buy food what's better being away from your family and having money or being with your family and having no money the government doesn't keep an official count of the number of iranian workers here but says there are hundreds and that number has tripled in the last 2 years as iran's economy suffers from u.s. sanctions the director of labor in the semi autonomous kurdish region expects more iranians to seek work here will be taking advantage of an economy on the rebound following several tough years. yet he had attempted i proposed a plan to address the situation with iranian were. it would match them with jobs we
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have a need for we don't want to close the border with them but we must organize a situation that effects the local workers greatly and we have to give them a priority. he says for the time being the kurdistan regional government has no intention of barring these men bound by culture and language many people see these iranian kurds as their brothers and sympathize with their plight. from vegetables to milk cooking oil to washing detergent in southern iraq almost everything on sale is from neighboring iran. not just theory products come from iran take it snakes cakes juices all are imported from iran there will be a crisis if these products. some locally produced items are available but imported goods are cheaper iran's proximity low prices and long established trade ties make it easier for vendors to rely on 3 indian products. that much. of an iranian
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groceries dominate the iraqi market because if it wasn't for the m locally produced groceries would have been sold at twice their actual price. but as the u.s. increases pressure and imposes biting sanctions on tehran iraqi traders are concerned. that what we can afford the absence of iranian goods in the market the average income of a person under the allows for buying cheap imported goods from iran. iraq is the only country exempt from u.s. sanctions on iran washington has extended baghdad's waiver on iranian imports for 3 months it's not clear what will happen when that expires as the u.s. insists iraq must find alternatives in anticipation of the sanctions iraq and iran have been discussing ways to continue the trade an estimated $25000000.00 worth of iranian imports into iraq every day according to iraqi officials there's a special financial agreement under which iraq will run without sending over any
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money iran will be able to use that money which remains inside iraq to purchase goods a similar to exist between iraq and some european countries to work around u.s. sanctions. and there are other powers spacefaring iran that are defending iran's interests which made iraq iran's back door a.t.m. so to speak to mitigate sanctions iraq's economy is largely unorganized a lack of official statistics and monitoring that makes it impossible to accurately picture what happens at the border with iran which stretches 1400 kilometers france germany and the u.k. introduced a mechanism called in sticks to facilitate trade in exchange of basic goods including food medical equipment and medicine between iranian and foreign companies iraq's case is different because in addition to household items baghdad relies heavily on iranian gas imported electricity. iraq also needs iran iraq
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situation isn't completely settled this extends to iraq's economy industry and agriculture besides iranian investment other foreign investment is no. although iraqi officials deny that baghdad is becoming iran's a.t.m. or cash machine the fear is that any restriction on cre could affect iraq's fragile instability now how the musicians like taylor swift make their money you may have thought that after her spat with businessman scooter braun who bought the rights to swift's 1st 6 albums that there was perhaps a link between streaming publishing record sales and her potential earnings well there is some truth in that but just not enough to make artists rich braun the manager of justin bieber and ariana grande a paid $300000000.00 for the rights for the master to swift's back catalogue but she isn't the 1st or last artist to have seen her work sold to the highest bidder paul mccartney wasn't happy and losing the rights to the beatles catalog to michael
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jackson in 1905 jackson paid $47000000.00 to buy a t.v. which included rights to music by bruce springsteen and the rolling stones because he's hoping to win the rights back musicians still make most of their money from touring according to billboard u 2 was the talk in 2018 dublin based rockers made $54000000.00 nearly all of their earnings coming from touring just $2400000.00 came from sales streaming and publishing. joining us now from london zac fuller a music analyst at miti at research good to have you with us on kinds of the costs act does taylor swift have a point with artists receiving such a small percentage of the revenue generated by their music where is the rest of the money going. of course this is a conflict that is old as music recorded music history and we've seen this going back from the days of the beatles there's always been this conflict over is the artist being renumerated in the way that they should through the record label now
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when artists often sign these deals they are not in the leverage position that they are once they become a global superstar so really what we've witnessed with the taylor swift story is that conflict that it cuz when an artist who has achieved global success then comes to renegotiate with a label that actually prior to that fame had their label had their rights signed off so even in this age of new technology and streaming the way in which we would get all music is it still the case the big music is king the big music is king it's interesting you bring this up because really what the big machine deal with involving taylor swifts rights has shown us is actually he's given this almost a platform to the very idea of the label service now what i mean by label service is that in an era of digital where a lot of artists are actually going direct to fan and bypassing the label system altogether labels are actually having to play catch up affectively and so instead
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of offering a deal where you are actually taking a lot of the artist's rights the value proposition that they are offering is using their marketing strategies their global networks their ability to build a brand and i see using that as their main selling point so what we've actually witnessed with regards to you refer to this idea of the bigger artist it's actually the middle class will be independent artists outpacing the recorded wind industries of growth if we look at last year it was actually labels services group 3 times quicker in terms of revenue than the overall recorded music industry so are bigger artists being as big as they were i mean it's a fair point to bring up but really it's labor services that winning at this point so what would your advice to be to end the. being a musician how can young artists ensure that they are. benefitting from the streams that they get from the fact that people want to download and listen to their music out how can they generate revenue what's
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important to remember now is that they have more choice than ever so bringing it back to the taylor swift story when she signed this deal these up change these didn't exist those labels services deals they were not in place and the whole streaming economy had not developed at this point so if you are younger artist you may choose to go with a ranger record label because you believe it's best for your art but ultimately now you have the choice now music streaming platforms really did disrupt the industry i mean i can't remember the last time i actually bought a physical copy of a recording a cd i mean vinyls had a bit of a revival but if you take the billboard numbers of what the streaming services are actually paying artists per stream it just fractions of a cent it's going to take a heck of a long time for musicians to profit from the music isn't it. well really what the streaming business model is done is it appended the whole idea of the sale and so i
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think the have been some teething problems in terms of how that those economics are beginning to add up because as you correctly identified if you're seeing per stream rates it begins to look quite low but the advantage of what we're seeing in streaming is it's expanding the overall music market so previous territories where you never would have received any revenue from it really in its most and its most embryonic form recorded music industry could only really monetize developed western markets streaming is completely changing that and as the overall base grows that it's going to be to the advantage of the artists so a streaming services like apple music and spotify the saviors of the music industry both the artists and the publishing companies or are they are they disruptors but in a bad way. it's a bit of it's interesting described as disruptors in a bad way i mean if you're talking to record labels we just should go by the sheer numbers you would almost bring out the savior narrative and record recorded music
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industry was in a state of almost some would have described terminal decline for the best part 15 years between 202015 those revenues are now starting to creep up again although it still has a long way to go for reaches the dizzy heights of what it was in 1990 streaming services have a sense the driven the majority of that growth and so the saving narrative the idea that spotify oh awful music would have saved a record labels isn't too far stretch to say taylor swift obviously unhappy about having to give so much of the revenue who work generates to the publishing companies that the record companies. looking at it from the other side who should she be happy that revenue the revenue that her songs are generating is in the stablish artists is going to help other younger less well established artists up and coming artists was an interesting point because if we consider one of the
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labels signs artists typically most of them on going to even make a profit in the end they're not going to go on to achieve the success that taylor swift has so one could make the view that yes revenues are going off to pay for the advances of other artists that weren't achieve the same level level of success that taylor swift does converse to that point is an artist may feel well this is my revenue and the one who is achieving that success i shouldn't be able to bankroll bankroll as other artists you can see both sides of the point from the label and the artist fascinating zack has been great to talk to you many thanks indeed for being with us on counting the cost thank you. that's our show for this week if you'd like to comment on anything that you've seen you can tweet me i'm at a finnigan on twitter please use the hash tag a j c t c when you do or you could drop us a line counting the cost al-jazeera dot net is our e-mail address as always there's plenty more for you online at al-jazeera dot com slash c.t.c.
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that takes you straight to a page there you'll find individual sports links even a tie episodes for you to catch up. but that's it for this edition of counting the cost i'm adrian for the game for the whole team here in doha thanks for being with us the news on al-jazeera is next. america is divided like never before inside is so convinced that they're absolutely correct that the other side is dangerous people in power investigates how partisan politics are raiding the civil norms vital to american democracy every indicator shows america to be the least well functioning democracy of any established. one of the strange death of american civility on al-jazeera.
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al-jazeera. where ever you. you're watching all just their arms the whole room in doha these are all top news stories the alleged mastermind of the september 11th attacks in the u.s. says he may be willing to help the victims in their lawsuit against saudi arabia in return khalid shaikh mohammed wants the government not to seek the death penalty against him particle hain explains the court proceeding so far this offer of assistance 1st comes in this court filing it's all part of the lawsuit from the survivors and victims of 911 against the government of saudi arabia so as part of this process the lawyer said that they needed to speak with the people who are in custody a key.


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