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Labour Party leader says UK finance sector will be ‘servant of industry’ under Labour government

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Britain’s financial sector will be “the servant of industry not the masters of us all” if the opposition Labour Party gets into power, its leader Jeremy Corbyn will say on Tuesday, accusing bankers of taking the economy hostage.

Corbyn, a socialist who has won over many voters with his promises to re-nationalize services and increase public spending, has long targeted London’s lucrative financial sector, saying politicians have been in thrall of money makers for too long.

In a speech to a manufacturers’ conference, Corbyn will renew his pledge to re-balance Britain’s economy if he wins power in an election not due until 2022, and will also criticize Prime Minister Theresa May for offering little clarity over Brexit.

“For a generation, instead of finance serving industry, politicians have served finance. We’ve seen where that ends: the productive economy, our public services and people’s lives being held hostage by a small number of too big to fail banks and casino financial institutions,” he will say.

“No more. The next Labour government will be the first in 40 years to stand up for the real economy. We will take decisive action to make finance the servant of industry not the masters
of us all.”

Big corporates have been cautious towards Labour, with financial services company Morgan Stanley warning investors that Corbyn winning power was a bigger political risk than Brexit.

But they have also started engaging with the party. Corbyn’s deputy, Labour’s finance policy adviser John McDonnell, took his message that capitalism was living on borrowed time, to the global elite at the World Economic Forum in Davos this year.

Any deep mutual understanding looks far off for now, with Corbyn promising to end the spread of finance’s “extractive logic” that “has spread into all areas of life with short-term performance and narrow shareholder value prioritized over long-run growth and broader economic benefit”.

The 68-year-old leader will say that if he takes power, his party would protect companies from hostile bids, citing the takeover bid of British engineering group GKN by investment company Melrose Industries.

“We rightly praise the growth of companies like GKN and their location in the UK. And yet when we are facing the possible destruction of that company, we are powerless to act,” he will say.

“That’s why the next Labour government will broaden the scope of the ‘public interest test’, allowing government to intervene to prevent hostile takeovers which destroy our industrial base.”

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ECB hawk says dissent at the central shouldn’t be dramatized

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People wearing face masks walk in front of a big Euro sign in Frankfurt am Main, western Germany, as the European Central Bank (ECB) headquarters can be seen in the background on April, 24, 2020.

Yann Schreiber | Getty Images

LONDON — One of the more hawkish members of the European Central Bank has sought to downplay the division seen at the Frankfurt institution this week, saying that he is still supportive of accommodative policy.

“We all agree we want to be supportive in this phase of the recovery, we all actually want to go to 2% [inflation], so my dissent shouldn’t be dramatized,” Belgian central bank governor and ECB member Pierre Wunsch told CNBC’s Joumanna Bercetche Friday.

Wunsch confirmed that he voted against the central bank’s new guidance on interest rates, announced on Thursday. He said he was reluctant to commit to the potential five or six-year time horizon for dovish policy to remain in place, in line with market expectations, given the possible risks that could force the central bank to change course.

Reports have suggested that Bundesbank President Jens Weidmann also voted against the changes.

“The most important conclusion of the retreat actually, and our new strategy, is what I would call a ‘no regret’ conclusion, in that we all agree that what we have been doing in the last few years was necessary and proportional,” Wunsch said.

“The question is whether this proportionality test that we are going to have to make in the future — whether we can remain proportional in what we do and take commitments over a long period of time, like five or six years in the future.”

“We might be faced with issues of fiscal dominance, issues of financial dominance, and I just, at the end of the day, did not feel comfortable taking a commitment for five or six years.”

Wunsch suggested that he may be “taking forward guidance too seriously,” and told CNBC that some of his colleagues at the ECB had suggested the guidance could be altered again should certain changes to financial conditions arise.

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India eyewear start-up Lenskart plans IPO in next 3 years, outlook: CEO

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Indian start-up Lenskart plans to go public within the next three years, CEO and founder Peyush Bansal told CNBC on Friday.

The company, which sells eyewear online and via retail outlets, this week announced it received $220 million in funds, led by Singapore state investor Temasek and Falcon Edge Capital. Earlier this year, Lenskart raised $95 million from global investment firm KKR. It also counts SoftBank as one of its investors.

“I think we would do an IPO in the next 24 to 36 months latest,” Bansal told CNBC’s “Street Signs Asia.”

“We still want to achieve a little bit more scale and grow our business in India as well as Southeast Asia. Then, we’ll be ready to do IPO,” he said, adding that the plan is to grow revenue to more than $500 million.

Lenskart expanded into Singapore in 2019. Bansal said Friday that he is confident the start-up can become the top player in the city-state over the next 12 to 18 months.

A man walks towards a Lenskart showroom in Gurugram, Haryana, India, on 16 March 2019.

Nasir Kachroo | NurPhoto | Getty Images

The company, which is reportedly valued at $2.5 billion, plans to use the newly raised funds to expand its presence in India and grow its operations in Southeast Asia and the Middle East in the next three to four years.

Some of the capital would also be deployed as investments into artificial intelligence and other technologies.

“There’s a huge demand for high-quality, affordable eyewear,” Bansal said about the Indian market. He claimed consumers buy on average four pairs of eyewear from Lenskart every two years, compared to a pair of eyewear every two-and-a-half years from other companies.

Stock picks and investing trends from CNBC Pro:

The biggest hurdle for Lenskart is creating a supply chain, according to Bansal. He explained that the company is in the process of building a manufacturing plant in India from which, it plans to ship about 150,000 prescription glasses a day.

“A lot of this capital actually goes in long-term investment in technology and building the supply chain infrastructure,” he said.

Indian start-ups are entering what some investors have described as the “beginning of a new era,” where the prominent names are going public. Food delivery firm Zomato made its stock market debut on Friday, and its shares jumped over 70% at the open.

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IOC says everything that can be done has been done

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A view of the Olympic rings in Tokyo ahead of the Tokyo 2020 Olympic Games in Japan.

Danny Lawson | PA Images | Getty Images

The Tokyo Olympics are set to officially begin after a one-year delay, and the International Olympic Committee says organizers have done all they can to ensure a safe games as the coronavirus pandemic rages on.

“Everything that … can be done, everything that was recommended by all these experts — some of them here with us to deliver these games — we have done,” Christophe Dubi, the IOC’s Olympic Games executive director, said in response

He was responding to criticism that the organization was using “cheap measures” and had not listened to advice. Dubi told CNBC’s “Capital Connection” on Friday that the IOC received help from many experts around the world and “diligently followed up” on all the measures that were recommended.

“I think we’re doing just the right thing, and we do not consider at all that it is cheap,” he said.

Challenges at the Olympics

World Health Organization Director-General Tedros Adhanom Ghebreyesus on Wednesday told organizers that they have done their best, and said the goal is not to have zero Covid cases during the games.

“The mark of success is making sure that any cases are identified, isolated, traced and cared for as quickly as possible, and onward transmission is interrupted,” Tedros said.

Dubi of the IOC said that’s what the organizers have done over the past few days, and will continue to do.

Looking to the future, including the 2022 Winter Olympic Games in Beijing, he said the IOC has learned how to create safe conditions, but that the situation is “very fluid” and will keep evolving.

“We have to be prepared for the worst and we have to plan for the worst,” he said. He added that there are “no talks whatsoever” about a postponement.

The show must go on?

Earlier this week, Toshiro Muto, chief of the Tokyo Olympics organizing committee, did not rule out canceling the event if Covid-19 cases spike.

But Kirsten Holmes, a professor who focuses on events and tourism at Curtin University, said it would be “very difficult” for the organizers to cancel the games.

For the organizing committee, it’s very difficult for them to not go ahead.

Kirsten Holmes

Professor at Curtin University

She said the Tokyo Games will be more logistically difficult than normal games, and there will need to be flexibility. “But I think it’s very unlikely that … the whole games will be stopped,” she said.

“We could see individual competitions within that postponed or perhaps canceled, if all of the competitors are unable to take part,” she told CNBC’s “Street Signs Asia” on Friday.

With no spectators or international visitors, Holmes said the games will be all about the athletes, some of whom may only have one chance to compete at this level.

“For the organizing committee, it’s very difficult for them to not go ahead, and that’s why … we will see the event proceed over the next couple of weeks and of course the Paralympic Games next month as well,” she said.

Disclosure: CNBC parent NBCUniversal owns NBC Sports and NBC Olympics. NBC Olympics is the U.S. broadcast rights holder to all Summer and Winter Games through 2032.



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