Category Archives: Business

IMF warns that tech giants stifle innovation and threaten stability

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Fund report calls for profits to be targeted by a tougher international tax regime

The International Monetary Fund has warned that the market power exercised by a small number of global companies threatens to stifle innovation and make it harder for central banks to deal with recessions.

Adding its contribution to the growing public debate about the corporate power exercised by the US tech giants such as Google, Amazon, Apple and Facebook, the IMF said it would be concerned if there was any further increase in the clout of already dominant firms.

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Late ‘grand dame’ of Aldi clan sparks family feud with her will

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Cäcilie Albrecht excludes late son’s wife and children from future roles in the company

The late wife of one of the founders of the discount supermarket chain Aldi has plunged the family into a bitter row after declaring in her will that her grandchildren and their mother are excluded from future business decisions.

Cäcilie Albrecht, known as the grande dame of the Aldi clan, vented her anger towards the five offspring of her late son, as well as his widow, Babette, accusing them of lavish spending not in keeping with the firm’s frugal philosophy, and of siphoning millions from company funds to finance their luxury lifestyles.

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Saudi oil company named world’s most profitable business

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State-owned Saudi Aramco makes profits of £84.7bn last year, beating Apple and Exxon

Saudi Arabia’s state oil company has emerged as the most profitable business in the world, racking up profits of $111.1bn (£84.7bn) in 2018 to overtake Apple.

According to a rare glimpse into its finances contained in a bond-offering document, Saudi Aramco made the profit on revenues of $355.9bn last year, as it produced 10.3m barrels per day of crude oil.

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Pay rise for nearly 2 million as UK living wage goes up by 4.9%

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Legal adult minimum of £8.21 an hour still leaves millions struggling, say campaigners

Almost 2 million workers in the UK are in line for a pay rise on Monday as the legal minimum wage increases by nearly 5%.

Adults on pay rates rebranded as the “national living wage” will receive a 4.9% rise from £7.83 to £8.21 an hour, worth an extra £690 over a year and affecting around 1.6 million people. The hourly rate for 21- to 24-year-olds will go up from £7.38 to £7.70, and for 18- to 20-year-olds from £5.90 to £6.15 in increases that cover about 230,000 people.

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Trump Fed pick was held in contempt for failing to pay ex-wife over $300,000

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Records obtained by Guardian show Stephen Moore reprimanded by judge for not paying alimony, child support and other debts

Stephen Moore, the economics commentator chosen by Donald Trump for a seat on the Federal Reserve board, was found in contempt of court after failing to pay his ex-wife hundreds of thousands of dollars in alimony, child support and other debts.

Related: Trump’s Federal Reserve pick owes $75,000 in taxes, US government alleges

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Investigators ‘believe Ethiopian 737 Max’s anti-stall system activated’

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Reports of high-level briefing with US regulators come as lawsuit is filed against Boeing

Investigators believe Boeing’s controversial anti-stall system on its 737 Max aircraft was activated before Ethiopian Airlines flight ET302 crashed, killing all 157 people onboard, according to reports of a high-level safety briefing with US regulators.

The apparent findings, reported in the Wall Street Journal, would be the strongest indication yet that the same software problem could have contributed to the crash and that of Lion Air flight 610, which killed 189 people in Indonesia in October.

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Turkey may be the spark that lights a fire in the world economy | Larry Elliott

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Erdoğan’s costly move against currency speculators could prove to have major ripple effects

The battle waged by Turkey’s Recep Tayyip Erdoğan against currency speculators is a classic pyrrhic victory. The show of resolve by the self-styled strongman on Wednesday stopped investors from dumping the lira but at enormous cost in both the short and long term. That Turkey will be damaged is beyond question. All that’s in doubt is how severe that damage will be and whether the fallout will be felt elsewhere. Looking at the fragile state of the global economy, there’s every chance it will be.

The backdrop to the latest instalment of a long-running crisis is that Erdoğan is this week facing important local elections at a time when the Turkish economy is in recession. In an attempt to drum up support, Turkey’s president last week condemned Donald Trump’s decision to recognise Israeli control over the Golan heights, but this proved a spectacular own goal by convincing foreign investors that Ankara was on a collision course with Washington. The lira plunged.

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All new UK cars to have speed limiters by 2022 under EU plans

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Road safety measure part of package of reforms likely to be adopted despite Brexit

All new cars sold in the UK and Europe are to be fitted with devices to automatically stop drivers from exceeding the speed limit under sweeping changes to vehicle safety rules provisionally agreed by the EU.

Although Britain may no longer be part of the EU when the rules come into effect, the UK regulator, the Vehicle Certification Agency, has said it will mirror safety standards for vehicles in the UK.

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Double standards on oil spills in Nigeria must end | Letters

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Oil companies must respect human lives and clean up the damage their industry does wherever they operate, say Dr John Sentamu, Baroness Amos, Prof Michael Watts, Njeri Kabeberi and James Thornton

The devastating impact of oil spills is widely recognised. The past decade has witnessed the destruction caused to human life and the environment from spills including the Deepwater Horizon spill in the Gulf of Mexico in 2010 and the Montara spill in Australia in 2009.

On each occasion the global community has reacted with horror, demanding the oil industry clean up local ecosystems and communities. Yet in Nigeria, and particularly in Bayelsa state in the Niger Delta, these calls are ignored.

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Macron’s mini-summit in Paris is a snub to Trump’s trade policy | Larry Elliott

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European leaders and China’s Xi Jinping put on a show of unity in the face of US tariffs

Donald Trump was not on the guest list for Emmanuel Macron’s mini-summit in Paris, but the presence of the US president was still very much felt as Europe’s leaders sat down to talk trade, business deals and geopolitics with China’s Xi Jinping.

At one level, the message from the meeting of China’s leader with Macron, the German chancellor Angela Merkel and the European commission president Jean-Claude Juncker was obvious: this was a show of unity in the face of Trump’s tariffs aimed across both the Atlantic and the Pacific.

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Asian stocks slump as US recession fears grip markets

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Australian treasury yields hit a record low in a grim portent for the economy, while the Nikkei falls 3% in wider share selloff

Shares in Asia Pacific have slumped after a key market indicator flashed an “amber warning” that the United States is heading for a recession.

Bond yields also continued to fall across the world with Australian 10-year treasury yields falling to a record low on Monday of 1.756% in what analysts see as a strong indicator of a downturn hitting the resource-rich country.

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Indonesian airline Garuda cancels order for 49 Boeing 737 Max 8 jets

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Company blames loss of passenger trust after Ethiopia Airlines and Lion Air disasters involving the aircraft

Indonesia’s national carrier Garuda has cancelled a multibillion-dollar order for 49 Boeing 737 Max 8 jets after two fatal crashes involving the plane, the company said, blaming passengers’ loss of trust in the aircraft.

In what is thought to be the first formal cancellation for the model, Garuda spokesman Ikhsan Rosan said: “We have sent a letter to Boeing requesting that the order be cancelled.

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Top oil firms spending millions lobbying to block climate change policies, says report

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Ad campaigns hide investment in a huge expansion of oil and gas extraction, says InfluenceMap

The largest five stock market listed oil and gas companies spend nearly $200m (£153m) a year lobbying to delay, control or block policies to tackle climate change, according to a new report.

Chevron, BP and ExxonMobil were the main companies leading the field in direct lobbying to push against a climate policy to tackle global warming, the report said.

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Climate change could make insurance too expensive for most people – report

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Munich Re, world’s largest reinsurance firm, warns premium rises could become social issue

Insurers have warned that climate change could make cover for ordinary people unaffordable after the world’s largest reinsurance firm blamed global warming for $24bn (£18bn) of losses in the Californian wildfires.

Ernst Rauch, Munich Re’s chief climatologist, told the Guardian that the costs could soon be widely felt, with premium rises already under discussion with clients holding asset concentrations in vulnerable parts of the state.

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US judge halts hundreds of drilling projects in groundbreaking climate change ruling

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In a rebuke of the Trump administration’s ‘energy-first’ agenda, a judge rules greenhouse gas emissions must be considered

In the first significant check on the Trump administration’s “energy-first” agenda, a US judge has temporarily halted hundreds of drilling projects for failing to take climate change into account.

Drilling had been stalled on more than 300,000 acres of public land in Wyoming after it was ruled the Trump administration violated environmental laws by failing to consider greenhouse gas emissions. The federal judge has ordered the Bureau of Land Management (BLM), which manages US public lands and issues leases to the energy industry, to redo its analysis.

The decision stems from an environmental lawsuit. WildEarth Guardians, Physicians for Social Responsibility, and the Western Environmental Law Center sued the BLM in 2016 for failing to calculate and limit the amount of greenhouse gas emissions from future oil and gas projects.

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Amsterdam to ban ‘disrespectful’ tours of red-light district

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Move is just one of measures taken to limit impact of mass tourism on historic city centre

Amsterdam is to ban guided tours of its red-light district as part of an effort to restrict the increasing throngs of visitors in its historic city centre, and because “they are not respectful” to sex workers.

“It is no longer acceptable in this age to see sex workers as a tourist attraction,” city councillor Udo Kock said. A survey has shown that 80% of sex workers say gawping tourists are bad for their business and councillors last year suggested moving the red light district to another part of the city.

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Global stock markets gain as investors predict cautious Federal Reserve – business live

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Central banks in spotlight amid Brexit uncertainty and growth concerns

The Bank’s reticence to raise rates has been hinted at by Gertjan Vlieghe and Silvana Tenreyro, two of the nine-member monetary policy committee.

Weaker growth prospects have come on top of concerns about Brexit, according to Martin Beck, lead UK economist at Oxford Economics, a consultancy. He expects a 9-0 vote to keep policy unchanged, saying:

The economy’s recent performance has been broadly in line with the MPC’s expectations. But public pronouncements by some committee members on downside risks have indicated a dovish shift around the pace of future rate hikes.

In light of the continued failure to get a Brexit deal through Parliament, Brexit uncertainty remains a key block on action by the MPC.

The Bank of England will also be in action later this week, with a monetary policy announcement on Thursday at midday.

Anything other than a unanimous vote to keep interest rates on hold would be a shock, for fairly obvious reasons.

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Deutsche Bank and Commerzbank confirm merger talks

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Unions warn merger of two German lenders could put up to 30,000 jobs at risk

Deutsche Bank has confirmed it is in merger talks with rival Commerzbank, putting an end to months of speculation over a potential tie-up that stands to unsettle the German banking landscape.

While the move has been touted as a route to greater profitability for the troubled lenders, unions have warned that the merger could put up to 30,000 jobs at risk.

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Buyer beware: Amsterdam seeks to ban buy-to-let on newbuild homes

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London and others will be watching closely as Dutch city tries to tackle housing shortage

Amsterdam has drawn up plans to ban the rental of new-build homes on city land, as part of a spate of policies to combat spiralling house prices, housing shortages and over-saturation of tourism.

The plan from its housing chief states: “Investors are buying Amsterdam homes more and more frequently, intending to rent them out. This means that ‘normal’ house-buyers have less of a chance in the housing market, and Amsterdam is not happy with this.”

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After two deadly disasters in five months, can Boeing survive?

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The global grounding of its bestselling model after 346 deaths has created a genuine crisis for the company and its clients

Within three minutes of takeoff, Ethiopian Airlines flight 302 had accelerated to unusually high speeds. Captain Yared Getachew knew something was wrong as the aircraft, a Boeing 737 Max 8, erratically dipped and climbed by hundreds of feet. He radioed air traffic control, requesting a return to Addis Ababa airport.

He was cleared to return and the aircraft began to turn right, climbing even higher. A minute later, flight 302 disappeared from the radar.

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