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
- Saudi Aramco, the state-owned oil giant, has promised to scale up investments into energy production after its profits doubled in 2021. The war in Ukraine has revealed Europe’s dependence on Russian oil, and Boris Johnson visited Saudi Arabia last week to try and persuade them to ramp up production.
- Paper £20 and £50 notes will no longer be accepted from September, but can be traded in for the new plastic notes. The Bank of England announced this week that almost £19 billion of old notes remain in circulation. Despite cash use significantly falling during Covid-19, it still accounted for 17% of all payments in 2020.
- P&O Ferries sacked 800 employees last week in a move which Sunak called “awful” and “wrong”. In some cases, staff refused to leave their cabins and employment lawyers have expressed concern as to whether the terminations were legal. Workers may bring a case against P&O Ferries, and trade unions are already offering support.
- Interest rates rose to 0.75%, the third time in four months that the Bank of England has hiked the base rate. Explaining how inflation could shoot up above 8%, policymakers justified the raise as due to “the tightness of the labour market” alongside “large increases in energy and other commodity prices including food”.
- The EU is reviewing its sustainable food strategy as the war in Ukraine is disrupting imports. In a meeting last Monday, they discussed the 175% rise in fertiliser prices, of which they import 30% from Russia. The Common Agricultural Policy remains the cornerstone of the strategy and has allowed the EU to become a net food exporter.
- The largest US banks have taken a $4.6 billion hit to revenues due to a freeze in equity raisings this year. The stock market volatility following the Ukraine invasion has caused a 75% fall in fees charged for equity sales and not a single IPO occurred between February 17th and March 14th.
- The Felipe Angeles airport near Mexico City is set for take-off today. The $5.6 billion project will have capacity for 20 million passengers, providing relief for the previously stretched international airport. Lack of air capacity has long been a barrier to Mexico’s economic development; however, the airport won’t operate fully for over a year.
Politics
- The Chancellor has said he will “stand by” to help people with the ongoing cost of living crisis. Sunak acknowledged that he cannot fully protect people from the consequences of inflation which he said was a cost of the sanctions against Russia. The shadow chancellor said she would continue to campaign against the 1.25% rise in National Insurance and Tory backbenches have called for a cut in fuel duty.
- France lifted almost all its Covid-19 restrictions. Mandatory mask-wearing indoors in schools and public buildings was abolished as well as the controversial “health pass” required to access bars and restaurants. The easing comes less than a month before the first round of voting, which President Macron is the strong favourite to win. France has one of the highest vaccination rates in Europe (78%) and has begun giving fourth jabs to over 80s.
- Nazanin Zaghari-Ratcliffe was released from Iran after being held for 6 years under charges of plotting to overthrow the Iranian government. Another British national, Anoosheh Ashoori, was released after being held for 5 years under charges of spying. Both were released when Britain returned £400 million to Iran for unsupplied tanks in the 1970s.
- Europe’s first nuclear reactor for 15 years is now operational in Finland. The Olkiluoto 3 reactor, intended to be opened in 2009, is set to fulfil 14% of Finland’s domestic energy demand. The government hopes the plant will lower prices and reduce dependency on Russian energy supplies. Finland is the only Nordic country which imports most of its energy needs.
- Poland’s largest cities are at their limits for the number of refugees they can harbour. 1.8 million Ukrainians have fled to Poland (over half of the 3 million displaced) with 300,000 to Warsaw and 100,000 to Kraków. At present, refugees are put up in private homes and sports centres. The UN estimates that a further 1.85 million people are displaced within Ukraine.
- The Sri Lankan government has refused to investigate potential war crimes after the UN Human Rights Council was authorised by member states to collect evidence on the abuse of the Prevention of Terrorism Act by the government during the 26-year civil war to hold members of the Tamil ethnic group for years without evidence, among other acts of injustice. The European Union said it would suspend tariff-free access to their markets – to which Sri Lanka exported $2 billion worth of garments in 2020.
- Unsealed files in the USA have revealed a Chinese plot to smear a former leader of the pro-democracy protests in Tiananmen Square who is running for US Congress after serving in the US military. Three of five plotters have been arrested due to this attempted interference in a federal election.
Written by Tristan Hand and Faris Lovejoy
etonomics.com 