Sunday, October 30, 2016

EU, Canada sign trade deal; Weak pound not a tonic for UK recovery; Samsung profit falls 30%

1 EU, Canada sign trade deal (BBC) The European Union and Canada have signed a long-delayed landmark trade deal, following weeks of uncertainty due to opposition in Belgium. The deal was signed in Brussels by Canadian Prime Minister Justin Trudeau and top EU officials.

All 28 EU states approved the deal on Friday when consensus was reached. The Comprehensive Economic and Trade Agreement, known as Ceta, required all EU member states to endorse it. The deal removes 99% of tariffs - and officials hope it will generate an increase in trade worth $12bn (€10.9bn; £9.8bn) a year.

After the agreement was finally signed, Mr Trudeau said: "Canadians and Europeans share the understanding that in order for real and meaningful economic growth, we need to create more good, well-paying jobs for our citizens.


2 Weak pound not a tonic for UK recovery (Phillip Inman in The Guardian) A tumbling pound is the defibrillator shock that Britain’s ailing exporters desperately needed to halt their terminal decline. That’s the message repeated on an almost daily loop by economists for Brexit.

Now that sterling has lost almost a fifth of its value against the dollar and about 14% against the euro since the referendum, it follows that the EU referendum vote was the best thing that could happen to the economy.

Almost overnight, manufacturers have found the price of their goods abroad have dropped, making them more competitive. They just need to let the currency work for them, revving up production safe in the knowledge they can undercut their rivals.

It is a narrow economic argument that uses Germany’s exporting prowess as a template. With the euro in place, Germany has kept manufacturing at the heart of its economy, accounting for about 20% of its national income. The UK manufacturing sector accounts for less than 10%.

Britain needs a sunny postcard from the future now that the immediate effects of a low pound are making life difficult for consumers. Import prices are rising and already feeding into shop prices. We’ve seen the early signs: Apple added £500 to the cost of its latest MacBook Pros and Unilever’s prices, including for Marmite, leaped by more than 10% at Morrisons.

The chances of mimicking Germany are slim. Firstly, there is the currency itself. We have a floating exchange rate against the rest of the world, which means it goes down in the bad times and up in the good times. Why would a manufacturing company bet on the currency staying low when a recovery in the UK’s fortunes will send it back up again?


3 Samsung profit falls 30% (Khaleej Times) Samsung Electronics has reported an expected 30 percent profit plunge on the back of a highly damaging recall crisis that hammered the reputation of the world's largest smartphone maker.

The third quarter earnings were announced just hours before the start of an annual shareholder meeting which was set to approve the latest step in a complex generational change of leadership at the family-run South Korean conglomerate.

Samsung said its operating profit for the July-September period stood at 5.2 trillion won ($4.6 billion), compared with 7.3 trillion won a year ago. The profit slump was in line with a revised earning estimate issued by Samsung two weeks earlier after it killed off its flagship Galaxy Note 7 smartphone due to devices overheating and bursting into flames.

The Lee family controls the Samsung group companies, with interests that extend into financial services, hotels, biopharmaceuticals and fashion, through a complex network of cross ownership. Samsung alone accounts for around 17 percent of South Korea's GDP and the Note 7 crisis has impacted the national economy, with the Bank of Korea adjusting its overall growth forecast.


No comments:

Post a Comment