News Briefing – 11/10/21

We’ve summarised the top stories of the last week into an easily digestible briefing, so that you can stay up to date on what’s happening around the world. You can subscribe to receive the briefing in your inbox each week.

Business & Economics

  1. More than 130 countries have signed up to a global deal, facilitated by the OECD, on corporate tax reform aimed at eliminating tax havens. The deal is expected to bring in over $150bn a year from multinationals.
  1. The United States economy added just 194,000 jobs in September, falling short of the 500,000 increase forecast by economists. The latest figures also underperformed the 366,000 jobs added in August and the monthly average of 561,000 since the start of 2021.

  2. Huw Pill, the Bank of England’s new chief economist, says that high levels of UK inflation could persist for longer than expected, suggesting that he agrees with the bleaker outlook of the Monetary Policy Committee.
  1. The infamous 12.5 per cent corporate tax rate in Ireland has been abandoned, as the country signed up to the minimum 15 per cent global rate that will cost the country about €2bn in lost annual revenues.
  1. Upon London’s threatening of the Northern Ireland protocol, the EU has offered to reduce many border controls between Northern Ireland and the British mainland, in an attempt to de-escalate tensions with the UK.
  1. Research by the Institute of Fiscal Studies, a think tank, concluded that the gap in education funding in England between private and state schools has almost doubled over the past decade, driven by a significant rise in private school fees. The average cost of annual private school fees was around £13,600 per pupil in 2020-21, nearly twice the £7,100 spent per state school student, according to the report released on Friday.
  1. Having pleaded guilty to failing to prevent alleged money laundering on Thursday, Natwest could face up to £340m in fines from the London court in which the trial took place. This was the first ever attempted prosecution of a UK lender, and the bank has been charged with three counts of failing to comply with anti-money laundering rules.

Politics

  1. Boris Johnson hosted the first in-person Conservative Party conference since the pandemic began. The conference took place whilst there were rising concerns of supply chain issues, inflation, and petrol and worker shortages. In his speech, Mr Johnson promised to “get on with the job” of uniting and “levelling up” the UK. The PM is to create an economic climate with controlled immigration and high productivity, wages, and skills. He further vowed to take “the pressure off the overheating South East [of England] while simultaneously offering hope and opportunity to those areas that have felt left behind”.
  1. The World Health Organisation has authorised the use of the first malaria vaccine, RTS,S (made by GlaxoSmithKline) for children at risk of infection. The jab is said to reduce cases of severe malaria in young children by 30%. A child under five dies of malaria every two minutes, with most sub-Saharan Africans catching it several times a year.
  1. Somalia saw their already delayed elections postponed again. President Mohamed Abdullahi Mohamed is facing criticism for stalling the vote to stay in power and, as such, tensions between him and government ministers have risen.
  1. Global gas prices are at record highs. Some energy supply firms are failing due to the price cap system which sets the maximum level a supplier can charge a consumer on a standard tariff. Business Secretary Kwasi Kwarteng has said that the energy price cap (reviewed every six months) ‘will not be moved’ this winter.

  2. The Pandora Papers have revealed the secret financial affairs of many billionaires, political leaders, and public officials. Among those exposed are Jordan’s King Abdullah II and Kenya’s President Uhuru Kenyatta. Many of those accused have been found to have used offshore shell companies in tax havens for tax avoidance purposes.
  1. Negotiations following Germany’s election on September 26 are taking place to form a three-way coalition between the Liberal Free Democrats, the Greens, and the Social Democrats. The Social Democrats’ candidate and experienced finance minister, Olaf Scholz, is expected to be Merkel’s heir.
  1. Mexico’s president Mr Obrador has disclosed plans to change the constitution to seize greater control of the energy industry. The plans propose to nationalise lithium production, a resource greatly in demand as it is used in batteries. Two regulators will be abolished with a large share of the market being reserved for the state electricity company.
  1. Austria’s chancellor, conservative Sebastian Kurz, has resigned on suspicion of corruption. He was due to play a vital role in saving the coalition government from the brink of collapse. Although he has stepped back from the highest position within Austrian politics, Kurz remains in control of the People’s Party.

Written by Rohan Battula and Aaryan Haria

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