IMF chief Christine Lagarde said signs of increased protectionism amid deteriorating global economic conditions were “alarming”, and warned such measures affect everyone. “The latest report by the WTO [World Trade Organization] is quite alarming because there is a rise of protectionism,” she said at a business forum in the Indonesian capital Jakarta. The International Monetary Fund managing director also warned that “no country is immune” from the effects of protectionism, The Telegraph reports.
The fate of Barclays itself was the main reason why Paul Tucker made his crucial phone call to Bob Diamond in October 2008. HSBC and Santander had been given a clean bill of health, RBS and Lloyds had already succumbed to public control, and Barclays looked to be the next bank in the line of fire as contagion spread through the system. Officials in Whitehall were monitoring the health of individual institutions by tracking Libor, the rate at which banks lend to each other in the money markets. The fear of the bureaucrats in the Treasury and around Gordon Brown was that Barclays might be heading for the abyss, and this was reflected in its cost of borrowing. Tucker should not be persecuted for doing a central banker’s job of keeping markets afloat. But it will now be hard for him to escape the taint that Diamond has left on him, writes Alex Brummer at The Daily Mail
Euro area finance ministers have agreed on the terms of a bailout for Spain’s troubled banks, saying that 30bn euros can be ready by end of this month to help save one of the largest countries in the Eurozone from needing a full bailout. Ministers also agreed to grant Spain an extra year until 2014 to reach its deficit reduction targets in exchange for further budget saving. The decisions were aimed at preventing the currency area’s fourth largest economy, mired in a worsening recession, from needing a full state bailout that would stretch the limits of Europe’s rescue fund and plunge it deeper into a debt crisis. “We are aiming at reaching a formal agreement in the second half of July, taking into account national parliamentary procedures, allowing for a first disbursement of 30bn euros by the end of the month to be mobilised as a contingency in case of urgent needs in the Spanish banking sector,” Euro Group President Jean-Claude Juncker said, according to The Telegraph.
Supermarket chain Morrisons is understood to be in talks over acquiring a significant number of Costcutter stores in a move which would rapidly increase its presence in the convenience store sector. The Yorkshire-based chain is in discussion with financial services and shipping company Bibby Line Group, owner of Costcutter, which has more than 100 stores in Scotland.The UK’s fourth-largest supermarket is battling to compete with rivals Tesco and Sainsbury’s which have enjoyed significant success by moving into smaller convenience stores in high streets and suburbs. Morrisons already has a smaller story format – M Local – which was launched last June and has ambitious plans to expand the number of sites to 70 by the start of 2014, The Scotsman reports.
A new accord to get banks lending to British aerospace companies is among a number of initiatives to be revealed today at the Farnborough International Airshow. Vince Cable will make £120 million available to the industry and promise a new age of engagement for Britain to “retain its position as the largest aerospace manufacturer in Europe and No 2 globally”. The Business Secretary’s department estimates that Britain has 17 per cent of the global aerospace market. With about 30,000 commercial aircraft due to be built over the next 30 years, Dr Cable will pledge “to work together to address barriers to growth and to exploit the huge opportunity for growth in the sector,” writes The Times.
Agusta Westland used Farnborough Airshow to unveil its scheme to build its new AW189 civil helicopter in Yeovil, which is expected to create 1,500 jobs in the UK and £2bn of exports. Graham Cole, AgustaWestland chairman, said it was a “giant step” for the company. David Cameron, the Prime Minister, hailed the news as he opened the airshow and voiced his strongest support yet for the defence industry. Britain’s leading defence manufacturers, such as BAE Systems, have been hurt by UK public spending cuts, but Mr Cameron identified aerospace as a “real success story” for the economy. However, he warned that the rest of the world was “breathing down our necks” and the UK had to be “constantly alive to the competition,” The Telegraph says.
British Land has been criticised over its decision to reappoint Deloitte as auditor amid questions over the accountant’s independence. Pirc, the activist shareholder advisory group, said in a note to shareholders that the listed property group had paid Deloitte’s property consultancy division — Drivers Jonas Deloitte — £300,000 in non-audit fees last year. The payments were for advice relating to 75 acres of development land next to British Land’s Meadowhall shopping centre in Sheffield. Pirc said that this equated to 80% of Deloitte’s audit fees last year from British Land and was more than 100% of the audit fees paid by the company over a three-year aggregate basis. “This level of non-audit fees raises independence concerns over the external auditors. An oppose vote is recommended,” it said, The Times explains.
Savers tempted by the idea of a pension guarantee to ensure they never get back less than what they put in have been warned that it will come at a price – potentially eating £50,000 of a £450,000 retirement pot. The plan for a ‘safe’ pension that would guarantee that it ended up worth at least all the contributions paid in by an employee, employer and the Government through tax relief, has been raised by pensions minister Steve Webb. But while many who have been burnt by the stock market would be sorely tempted by such a guarantee, the cost imposed through even a 0.5% charge each year to pay for it will add up over the long term The Daily Mail writes.