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Posts Tagged ‘Post-Brexit’

Britain’s economy could face £84bn black hole post-Brexit

Tuesday, November 29th, 2016

Image result for uk economy

Britain’s economy could face a black hole of £84bn ($102.3bn) by the time the Chancellor sets out his spending plans in the Autumn Statement next month, a think tank has warned.

According to a report from the Resolution Foundation, the deteriorating economic outlook, increased spending and lower tax receipts in the aftermath of Brexit could leave the government facing a shortfall until 2020-21.

The think-tank warned the Treasury would face a £23bn deficit at the end of the parliament, meaning the government would have to find a combined £84bn to balance the books over the next five years. However, the Foundation added, the only way to do so would be by implementing cuts or allow for extra borrowing.

George Osborne’s pledge to achieve a budget surplus by 2020 has already been abandoned by the government, which by then could be confronted with an economy £60bn smaller than it was expected to be before the referendum.

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UK economy is braced for interesting times as Brexit phoney war end

Saturday, November 26th, 2016

Theresa May and Philip Hammond

The four months since the Brexit vote have been something of a phoney war. Life for most has trundled on just as before. The shops have been full. Employment has continued to rise. Britain is still the low pay, low productivity country it always was. If someone had left in early June and returned today without access to the news, they would never know there had been a referendum.

The release of the growth figures for the third quarter of 2016 on Thursday will reinforce the sense that not much has changed.

In August, the Bank of England expected the economy to almost stall but it has had second thoughts in the light of more upbeat data. The consensus in the City is for growth of 0.3-0.4%, down on the second quarter but hardly a disaster.

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UK support for Nissan may be costly, hard to calculate

Thursday, November 17th, 2016

Image result for Nissan UK

LONDON, Oct 27 (Reuters) – The support that the UK government has promised carmaker Nissan in return for building new models in Britain could prove expensive, but the Japanese carmaker’s complex structure makes it hard to estimate.

Nissan announced on Thursday it would build the new Qashqai and the X-Trail SUV in Sunderland, England, after saying in September it would only commit to new UK investment if it got a promise of compensation should Britain’s move to leave the European Union lead to new taxes on car exports.

Nissan’s main UK arm sells vehicles worth 5.3 billion pounds ($6.5 billion) a year, its accounts show. It says 55 percent of the cars go to Europe, suggesting exports of about 2.9 billion.

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Nissan boosted UK investment after it ‘got 11th-hour pledge’ it would not be hurt by Brexit

Saturday, November 12th, 2016

Nissan Sunderland

Nissan demanded and received a guarantee from the Government about the UK’s future post-Brexit before the manufacturer agreed to keep investing in the country, it has been reported.

After the car maker said it would build two new car models at its Sunderland plant, it emerged that ministers were forced to give a last-minute assurance that its UK operations would “remain competitive”.

The Times reported that Business Secretary Greg Clark had written to the board of the Japanese company in what was considered a guarantee that it would not face high tariffs on car exports if the UK leaves the EU customs area without a free trade agreement.

Downing Street has denied that Nissan was offered a “sweetheart deal” as other car manufacturers called for similar pledges, with Toyota saying it trusted the government to provide “fair treatment”.

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UK fintech startups raised £40 million in July, showing Brexit hasn’t killed the hot sector

Monday, September 19th, 2016

Revolut cofounders Vlad Yatsenko, left, and Nikolay Storonsky

UK fintech startups raised £40 million in July, showing Brexit hasn’t killed the hot sector

British fintech startups have announced at least £40 million of investment in just over a month since the referendum on the UK’s membership of the European Union, according to an analysis by Business Insider. Nine funding deals in the fintech sector totalling £40.6 million have been announced since June 23, when Britain shocked the world by voting to leave the European Union. While the figure should help to allay fears of a post-Brexit fintech slowdown, most of the deals will have been in the works for months and so may not be the best indication of investor confidence post-referendum. However, the fact that these deals weren’t called off in the wake of the vote is a positive sign. Investment is holding steady at the same rate as the start of the year. A report from KPMG earlier this year showed $162 million (£110.8 million) was invested in 15 UK-based fintech startups between January and April

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Brexit threatens to burn Britain’s bridge with a vital EU institution that has invested billions into British startups

Wednesday, September 14th, 2016

People hold banners during a 'March for Europe' demonstration against Britain's decision to leave the European Union, in central London, Britain July 2, 2016. Britain voted to leave the European Union in the EU Brexit referendum.

The future of a crucial source of UK startup money hangs in the balance following the nation’s decision to leave the European Union. That source is the relatively unknown European Investment Fund (EIF), which is an institution that was created by the EU in 1994 and operates out of Luxembourg with a team of around 400 people. The EIF, which has commercial banks and other financial entities among its shareholders, invested over €2.3 billion (£2 billion) in UK startups between 2011 and 2015, according to industry data cited by The Financial Times on Tuesday. That reportedly accounts for over a third of all such investment. EIF capital finds its way to UK startups via a network of venture capital institutions that back fledgling technology companies that they think are destined for success with billions of pounds. The Financial Times reported that the EIF gave money to 144 UK-based venture capital companies or similar entities between 2011 and 2015. That makes it one of the largest, if not the biggest, investor in UK venture capital funds and growth-capital funds, according to Michael Collins, deputy chief executive of Invest Europe.

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London keeps tech investment lead despite Brexit

Monday, September 12th, 2016

Capital still flowing into technology companies as London stays ahead of Paris, Amsterdam and other European cities.

Leading global investment firms have committed to continue investing in the UK’s tech sector saying that London will remain an important destination for investment despite the vote to leave the European Union. Venture capital houses such as Index Ventures, Octopus Ventures, Balderton Capital and Hoxton Ventures are among a wider group of investment firms to pledge their continued support for the UK’s tech sector, with many citing London as an important hub for future growth. In the first six months of 2016 British companies attracted $1.3 billion in venture capital funding, matching the $1.3 billion raised in the same period in 2015. Some of the largest deals this year include London-based transport app Citymapper ($40m), Student.com ($60m) and a $65 million deal for British cybersecurity firm, Darktrace, completed after the referendum vote1. Investment into London and UK-based technology companies remains strong since the Brexit vote, with British tech firms attracting $200m of venture capital funding across 42 deals, according to the latest research from London & Partners, the Mayor of London’s promotional company2.

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UK borrowing falling slower than hoped despite July surplus – as it happened

Thursday, September 8th, 2016

Skyscrapers in the City of London.

US rig numbers rise for eighth week

UK Dividends Lag Behind Rest Of World After Growth Hit

Wednesday, September 7th, 2016

UK dividends are lagging behind the rest of the globe after eking out the weakest performance in the G7, a report has found.

UK dividends are lagging behind the rest of the globe after eking out the weakest performance in the G7, a report has found. The Henderson Global Dividend Index found that UK dividends fell by 3.3% year-on-year in the second quarter, as the slump in sterling and cuts from blue-chip companies hammered growth. However, the UK’s total of 33.7 billion US dollars (£25.8 billion) was 7.7% higher than last year, thanks in part to special dividends issued by drugs giant GlaxoSmithKline and Intercontinental Hotels. It said corporate heavyweights Standard Chartered, Anglo American, Barclays and Morrisons were among the firms to make deep cuts. Alex Crooke, head of global equity income at Henderson Global Investors said: “Profit growth remains under pressure in the UK, limiting the potential for companies to increase dividends.

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