Connect with us

Money

Brexit Impact suggests Lack of Optimism in UK Business

Mirror News Desk

Published

on

brexit impact

UK’s post-Brexit future has growing concerns across Scotland. As per a quarterly survey post Brexit impact can lead to lack of optimism in business environment of UK.

During the third quarter of this year, the Scottish Chambers of Commerce found sturdy financial results across different sectors in which they analysed post Brexit impact as well.

As per the findings, 21 percent of firms surveyed, showed less optimistic nature towards the business environment in the third quarter than in the previous quarter. However, this was up from 15 percent in the previous survey.

The Scottish Chambers of Commerce suggested that uncertainty was growing “around the future trading environment with the European Union”.

Most of the sectors are relatively still confident. But manufacturing brought in its first negative score for optimism in two years, despite a fairly positive performance. It was stated that the rising cost of raw materials is bringing in a lot of pressure.

Business services, construction, manufacturing and tourism sectors have reported declining investment levels, bringing down the investment expectations in most of the sectors. Slowing in investment is despite of the fact that only 17 percent respondents reported decreased revenue, while 43 percent reported increased revenue.

According to the survey post Brexit impact may lead to, only “substantive increase” in retail investment sector during the third quarter.

The Fraser of Allander Institute, one of the contributors of the report, said it continued to remain “cautiously optimistic” about the outlook for the Scottish economy this year and next. However, the institute also added that much depended on a “broad-based agreement being secured between the UK and the EU which supports continued close economic integration post-March 2019.”

The director of the institute, Prof. Graeme Roy added, “Most economists have argued that a ‘hard Brexit’ will act as a significant drag on Scotland’s – and the UK’s – economic potential. However, it is the risk of a ‘no-deal’ scenario that is of most concern in the immediate term. Whether you agree or disagree with the decision to leave the EU the need for an orderly transition is vital. Sleepwalking into a ‘no-deal’ outcome cannot be viewed as an effective economic plan.” But the suggested post Brexit impact cannot be ruled out as well.

Chairman of the Scottish Chambers of Commerce Economic Advisory Group, Neil Amner said, “Our survey results for the third quarter of 2018 suggest that the Scottish economy continues to be resilient, but firms are becoming cautious as uncertainty grows around the future trading environment with the European Union.”

Money

Investors Losing Hope to Recover Money from UK-Based Signature Living

Mirror News Desk

Published

on

signature Living

At the outfit it sounds as a good deal to invest in an international luxury hotel chain, but the investors seeking money from Liverpool-based chain are losing hope of recovering their capital.

The investors from countries across Europe and Asia, who said they had to fly to the UK to ask for their money back, were initially promised hundreds of thousands of pounds by Signature Living. The luxury hotel chain owns a number of historic and refurbished UK properties.

The firm’s founder Lawrence Kenwright said, investors would eventually get back their money and “they have to trust me”. Ironically, back in May he said that every investor would receive their share by the end of that month.

Presently, investors are caught in a vicious circle of trying to get their money back, while rigorously pushing to see the hotel’s owner. However, neither their money nor the Signature Living’s owner has showed up.

“It’s just an appalling way to treat investors,” said Susanne Grampe, who travelled to Liverpool last month from Germany in a face-to-face attempt to recoup about £110,000 owed to her. “I’m devastated,” she added.

Grampe exclaimed that she invested in the company’s football-themed George Best Hotel in Belfast and that the money was supposed to help pay for the care of her elderly parents.

As per the documents obtained by the BBC, signed by a senior Signature executive, the full amount in six weekly payments starting on 6 November was to be paid. However, no payment has been recorded yet.

Other than that, Lawrence Kenwright had already promised via email to repay Grampe. “I will ensure that you get another 20k payment this Friday and every Friday thereafter. “Please keep in contact with me and I will ensure that this happens,” he added. But as it turns out, every promise made until this point has been nothing, but a lie told with conviction.

Kenwright, who has his own YouTube Channel and recently presented TedX talk on “entrepreneurial socialism”, once again told the investors that they would be paid once the multiple hotels involved had been completed and sold.

As a fact, more than a dozen investors are still waiting for the money they are owed by Signature Living. One Hong Kong real estate agent said that she had already been to the UK thrice over the past two years, but still couldn’t get any help from Kenwright. “Of course I regret investing in Signature Living,” she said. “It affects the reputation of the UK property market. People are very afraid to invest there now,” she added as a sign of concern.

Continue Reading

Money

Individual Voluntary Arrangements Triggering Insolvencies; Reports Show

Mirror News Desk

Published

on

IVA

Individual Voluntary Arrangements or IVAs have become the new trend to survive another day amidst financial crisis, but the technique is failing big time across England and Wales. As reported, the numbers are following an upward trajectory so fast that the financially insolvent people have shot up by nearly a quarter.

According to the Insolvency Service, personal insolvencies across England and Wales rose by 23 per cent to 30,879 in the third quarter. The number includes around 19, 973 individual voluntary arrangements between July and September, with a spike of 43 per cent in it, compared to the last year.

Individual Voluntary Arrangements (IVAs) have gained huge momentum because they are a legally binding accord between payer and payee, which grants a fixed time period over which the payer has return the debts. Such an agreement provides safety and is approved by the court only if both parties agree. Even celebrities such as Katie Price have made use of the service.

However, with legal obligation to return the money, the scenario turns upside down, especially for youth who are more reliant on debts to accomplish their needs. The latest insolvency figures come as Alec Pilmoor, personal insolvency partner at consultancy RSM, raised concerns over the rising number of people becoming insolvent in the age group of 18 to 25 years.

“Continued access to easy money, and the prevalence of a cashless society makes it increasingly difficult for consumers to monitor their spending and maintain a budget effectively,” he said. Adding that those within this age group lack much financial experience and sufficient education from school or finance providers.

Overall, the numbers also state that personal insolvencies are at the highest quarterly level for the past four quarters, since late 2010.

“Today’s figures provide a worrying insight into the state of personal finances; the comparison with the same quarter last year shows an especially steep increase in personal insolvencies,” said R3, the trade association for the UK’s insolvency specialists.

The concern is real and the numbers just prove it. The management of money across England and Wales needs a real time solution because short time dependency on Individual Voluntary Arrangements is only making the matters worse.

Continue Reading

Money

Amid Rising Brexit Uncertainty, Pound registers Record Streak

Mirror News Desk

Published

on

Brexit Uncertainty

Amidst the rising Brexit Uncertainty, the main concern is that the UK’s economy would be more adversely affected due to the series of bankruptcy in companies, reduction in profit of the organisations and an unfavourable season for the investment in the manufacturing industry.

On the other hand, the British Pound has recorded a rise for the longest time since the extension of the Brexit referendum after UK lawmakers voted to oppose the accelerated timetable for UK’s exit from the EU.

With this, the currency has recorded a growth of one percent or more in the past nine days, which is the largest since the public referendum on the fate of Brexit in July 2016.

The record move of the Pound has come after amidst the ever-changing scenario of hopes and Brexit Uncertainty. Earlier, the uncertainty surrounded the Tory leader and Prime Minister Boris Johnson and if he can manage to deliver Brexit and get EU to re-negotiate withdrawal deal and agree on it.

Paul Davies at Capital Economics while speaking further on the uncertainty surrounding Brexit said that the Pound could rise to $1.35 against the dollar if the MPs at House of Commons approve Johnson’s Brexit deal.

Speaking further he said, “That said, should parliament block a deal and Brexit ends up being delayed again, the pound may slide back a bit. And if there’s a no deal on 31st October, which seems very unlikely now the UK has asked the EU to delay Brexit, we suspect the pound would fall to $1.15.”

Aside from the UK market, the Brexit uncertainty will also adversely impact the MENA (Middle East and North Africa) region. However, if the Brexit deal happens, the MENA would be affected ways listed below.

  • A feeble Europe uninterested in the MENA region
  • A higher intervention of UK and its policy in the region
  • and a more capricious market than before bringing more trade and investment in the region
  • Increased involvement of the regional blocs and global powers such as China in the region.

The news of Brexit Uncertainty and its adverse effect on UK economy were released after the survey conducted by the Confederation of British Industry revealed that the possibility of no-deal Brexit has forced many of the businesses to withhold their investments for the upcoming year.

Furthermore, the same revelations were made by the statement of ratings agency Moody’s that said the country’s economy still faces risk and various uncertainties that will linger with the country’s economy for some time and bring with it some of the negative interference.

With parliament approving their support on Boris Johnson’s Brexit deal but not on its deadline, there remains a question, would the Brexit deal resolve the uncertainties surrounding Brexit or would further complicate and worsen them?

Continue Reading

Money

Pound Sterling Rises with Achieved Brexit Deal between UK and EU

Mirror News Desk

Published

on

Pound Sterling

Brexit has played an important role in manipulating the British currency pound sterling. The currency has jumped and fallen innumerable times with the fluctuations in deals that now seems to have achieved an important stance in the country.

Whenever the country has shown signs of moving towards a no-deal Brexit or leaving the EU without a deal, it has only led to the weakening of the currency. On the other hand, its value has simultaneously increased with Britain’s positive approach towards Brexit.

Earlier on Thursday morning, pound sterling fell as Northern Ireland’s Democratic Unionist Party (DUP), which has been backing the Conservatives in government for a long time said that they could not back a Brexit deal in its proposed current form.

Though DUP leader Arlene Foster said that her party was willing to continue working with the government to try and secure a deal they could back, it led to the downfall of pound sterling. One of the major reasons for their non-support over the current deal was the government’s stance on Northern Ireland border.

As known, Prime Minister Boris Johnson earlier wrote a letter to the EU Council asking them to remove the Irish Backstop from the withdrawal agreement, claiming that it was “anti-democratic and inconsistent with the sovereignty of the UK as a state”.

Though Johnson said that he was ready for the negotiations following the Brussel summit, he failed to earn Northern Ireland’s trust. The Irish leaders thereby aimed at getting a more appropriate deal that would work for Northern Ireland and protect the economic and constitutional integrity of the UK.  

With DUP’s final decision, the critics expected that the government would come up with a proper plan to get an agreement before the European Council summit that was scheduled for Thursday so it could be put before the parliament later this week.

This morning in Brussels, the hard efforts of pushing the EU to compromise on the final and outstanding issues resulted in agreed Brexit deal between the UK and the EU’s negotiators. The deal saw more than one percent surge in pound sterling, climbing above $1.29 against the dollar.

Moreover, the British currency also rose against the euro, though it failed to hang on to its initial gains due to the DUP party’s acts of opposing the deal.  

In response to the Brexit talks, European Commission President Jean-Claude Juncker said the deal was “a fair and balanced agreement for the EU and the UK and it is testament to our commitment to find solutions”.

Since Europe is home to various people originating from different countries, the UK’s exit from the EU through deal or a no-deal Brexit will impact each and every one differently. From stocks to house buildings and even banks, Brexit will have an alternate impact in each sphere.

Many expect that the deal achieved today could enhance the economic growth, interest rates and continued rise in pound sterling, the question is whether it could actually pass in the House of Commons on Saturday?

Continue Reading

Money

London Stock Exchange Takeover by HKEX Fails despite £32 Billion Bid

Mirror News Desk

Published

on

London Stock Exchange

The Hong Kong Exchanges and Clearing Limited (HKEX) has ceased its £32 billion venture to purchase the London Stock Exchange (LSE) citing a lack of sufficient support for the deal as the main reason. With this deal withdrawn, the HKEX has also failed to create one of the world’s largest financial marketplaces.

As soon as the news of failed the merger and acquisition (M&A) between the HKEX and the prized LSE made the news, LSE registered a drop of 6 percent to close £69.94. On the other hand, HKEX shares saw a growth of 2.7 percent following the failed M&A.

Moreover, HKEX released a statement on Tuesday morning in regards with dropping the multibillion-dollar bid and said, “The board of HKEX continues to believe that a combination of [London Stock Exchange Group] and HKEX is strategically compelling and would create a world-leading market infrastructure group.

“Despite engagement with a broad set of regulators and extensive shareholder engagement, the board of HKEX is disappointed that it has been unable to engage with the management of LSEG in realising this vision, and as a consequence has decided it is not in the best interests of HKEX shareholders to pursue this proposal.” 

American banker David Schwimmer was leading the negotiations for the LSE. With failed M&A between the HKEX and the London Stock Exchange, the latter can now pursue its takeover of Refinitiv for £22 billion.

Speaking in regards to the failed M&A between HKEX and LSE, chief market analyst Michael Hewson at CMC Markets said, “In reality the HKEX deal was never a realistic possibility when set against a hostile management at the London Stock Exchange and a Chinese regulator who were lukewarm at best.”

“Even if HKEX had decided to up their offer, the deal was of questionable merit, given the problems in Hong Kong right now, along with the exchange’s management structure, which raised concerns about Chinese possible government influence.”

On the other hand, Don Robert, the chairman of the London Stock Exchange claimed that the takeover of LSE by HKEX would not have been suitable for the LSE. He reasoned that the HKEX has ties with the Hong-Kong government and has board inclined towards the Hong Kong government.

Furthermore, it won’t be claim that seeing the current turmoil of Hong Kong due to pro-democracy protests, there remains questions on territory’s future as strategic gateway for financial investment.

Continue Reading

Trending