Financial Times UK - 20 08 2020

2020·28.18 MB·English

NEWS PROVIDER OF THE YEAR
THURSDAY 20 AUGUST 2020 UK £2.90 Channel Islands £3.20; Republic of Ireland €3.20
Rising Thais Aye for Scotland French resistance
Youth movement makes bold gesture London’s complacency has fuelled Why Macron takes a low profile on
with protests against king independence push China
— PAGE 6 — BIG READ, PAGE 19 — BEN HALL, PAGE 21
Apple passes markets milestone
Briefing
i Rail fare freeze weighed to revive usage
as shares take valuation to $2tn A freeze on rail fares is being considered by the
government to increase passenger numbers which
remain heavily depressed following a slump after
the coronavirus lockdown.
— PAGE 2
i Wales warns on future of Union
Government plans to pass legislation to underpin a
3 Stock surges 50% this year 3 $1tn rise in 24 months 3 Lead on Amazon opens to $300bn
new UK internal market at the end of the Brexit
transition period will “accelerate the break-up of
the Union”, the Welsh administration said.
— PAGE 2
Patrick McGee — San Francisco
Tim Bradshaw — London Apple i Harris pick greeted cautiously by India
Apple has hit a $2tn market capitalisa- Kamala Harris’s selection as
Market value ($tn)
tion just two years after it became the Democratic running mate has
world’s first trillion-dollar company. been greeted with caution in
The iPhone maker is the first US New Delhi over how a future
group to achieve such a valuation on the White House might view India’s
public markets and only the second in Hindu nationalist policy
2.0
the world to do so. The shares were up agenda.
— PAGE 4
1 per cent yesterday in midday trade in
New York. i Virus speeds move to virtual war games
State-backed oil company Saudi Ara- Defence chiefs are seeking to fast-track new virtual
mco briefly passed the milestone during reality technology developed by a UK gaming group
intraday trading last December on the to help test resilience to future pandemics, natural
1.5
day after its initial public offering but its disasters and attacks by hostile states.
— PAGE 3
shares subsequently closed at a market
capitalisation below the $2tn mark. i EU urges Belarus to reform from within
Aramco’s stock market fortunes have EU leaders have condemned the Belarus elections
waned since its IPO to trade at a market as unfair but stressed that any political change from
value of around $1.8tn. Apple surpassed the rule of Alexander Lukashenko must come from
1.0
Aramco last month. within the country.
— PAGE 4; INSIDE BUSINESS, PAGE 7
Apple’s shares have surged more than
50 per cent this year despite business i Spain reports surge in Covid-19 deaths
challenges, including having to close Spain reported 6,671 new coronavirus infections
stores because of the pandemic. It is also and 127 more deaths than the day before, levels not
under pressure over its reliance on seen since May, as the pandemic’s resurgence
0.5
China during the US government’s cam- accelerates in the country.
— PAGE 6
paigns against Huawei, TikTok and
2018 2019 2020
WeChat and has faced prominent allega- i J&J seals $6.5bn Momenta biotech deal
tions of anti-competitive behaviour. Source: Refinitiv Photo: Reuters Johnson & Johnson has agreed to buy biotech group
Its shares crossed the threshold of Momenta Pharmaceuticals for $6.5bn in an all-cash
$467.77 in morning trade, making Apple ruary, before Covid-19 had become a of its June quarter revenue was derived ices, Mr Campling attributed the stock- deal that will expand the world’s largest healthcare
the first $2tn tech giant and creating a full-blown pandemic, it issued a reve- from the iPhone. That share has since price surge to the beating of iPhone company’s autoimmune treatments.
— PAGE 7
gap of more than $300bn with Amazon, nue warning and withdrew its guidance. dwindled to 44 per cent, even as reve- sales forecasts last month. “The truth is
the next largest US company. The shares Despite the virus’s spread to the rest of nues have increased 12 per cent. it’s still an iPhone-led model. That’s not
Datawatch
have doubled since March when virus the world and the global economy’s fall In “wearables”, Apple accounts for necessarily a bad thing if you have the
panic swept Wall Street. into recession, overall sales soared 11 more than 40 per cent of the global mar- right product,” he said.
“Adding a trillion in four or five per cent in the June quarter. ket for smartwatches and “true wire- Some analysts are concerned that val- Democracy in Belarus Belarus has been
months — that’s really quite unbelieva- Apple’s $1tn rally in just 24 months less” headphones, according to Canalys, uation metrics are being stretched. compared to its neighbours rocked by mass
ble,” said Neil Campling, an analyst at reflects its success in moving beyond the a market analysis group. Its push into Apple’s price-to-earnings ratio is almost 0=lowest, 100=highest protests that
Mirabaud Securities. “We have, in a smartphone. Two years ago, 55 per cent services — from warranties to music, 35 times, its highest since late 2007 as followed a
Belarus Neighbours
very quick period of time for Apple, movies and a credit card — offers recur- the original iPhone unleashed unprece- disputed election.
gone from a discount valuation to the ring revenue from 550m paying users, dented growth. Government effectiveness International
‘The equity rally suggests either surveys show the
market to a premium valuation.” giving Apple smoother earnings and less Still, Apple would like to see its stock
Political stability extent to which
When Apple reported that all five of a huge bubble in the making — or dependence on the iPhone cycle. price go higher. It recently announced a
freedom is
its product categories increased reve- markets have a better grasp of “They’ve done a tremendous job in four-for-one stock split that will, when Voice and accountability
curtailed in the
nue in the June quarter, Goldman Sachs the economic dynamics of a increasing the service-related compo- in effect from August 31, make its shares Control of corruption country, which
analysts told clients: “It turns out that post-pandemic world than most nent of the business,” said Eric Papesh, a more accessible to the general public. scores the lowest
we and consensus weren’t even in the Inside portfolio strategist at T Rowe Price, Wall St winners and losers page 11 0 20 40 60 80 for voice and
consumers and governments’
ballpark in terms of what was possible.” which holds Apple stock. Markets Insight page 12 Source: World Bank Governance Indicators 2018 accountability
Apple, too, has been surprised. In Feb- — DEANNE JULIUS, PAGE 21 Despite the growth of Apple’s serv- Lex page 22
McKinsey earnt £560,000 for giving
‘vision’ to new public pandemic body
Tabby Kinder programme, had been appointed to run Wilson, the Liberal Democrat’s health
the new National Institute for Health spokesperson.
McKinsey was paid more than half a
Protection. McKinsey was contracted to corre-
million pounds by the government for
The institute will deal with pandemics spond with three members of the gov-
six weeks’ work to decide the “vision,
and manage coronavirus tracing. It ernment’s coronavirus response team,
purpose and narrative” of England’s
Oracle boss Ellison senses replaces Public Health England, which including Baroness Harding. The former
new public health authority, acc­or­ding
is to be scrapped in the wake of criticism McKinsey consultant worked at the firm
opportunity in TikTok race to a recently published contract.
over its handling of Covid-19. for seven years until 1995 before taking
Many analysts question the strategic The contract shows that McKinsey was England’s test-and-trace system, roles at companies including Tesco. A
logic of Oracle co-founder Larry Ellison enlisted by the Department of Health which was launched in May, has been Conservative peer, she was chief execu-
bidding to take over the US assets of and Social Care in May to prepare a criticised by the Labour party for “huge tive of telecoms group TalkTalk until
China’s TikTok, the popular video report on the options for a new body holes” and for the large sums spent on 2017, when she stepped down following
messaging app that is subject to that would run the test-and-trace coro- outsourcing to contractors such as anger over a damaging cyber attack.
forced closure by the White House. navirus programme. Serco. It has contacted 78 per cent of McKinsey said: “Our UK public sector
But it is an opportunity to acquire a The consultancy firm was hired to people diagnosed with coronavirus work is contracted by government offi-
hugely valuable consumer internet outline the “mission and vision” of the since its creation, latest figures show. cials under existing public procurement
business at a time when potential proposed organisation by the end of “The government’s focus should be on rules.” The DHSC did not immediately
buyers such as Facebook and Google June, according to the contract. making sure we have a test-and-trace respond to a request for comment.
are sitting on the sidelines as The contract was published before an programme that functions effectively News of the contract was first rep­or­-
politicians try to rein in their power. announcement this week that Dido rather than paying flashy consultants ted by Civil Service World magazine.
Analysis i PAGE 9 Harding, a former McKinsey consultant lots of money to come up with the Reports pages 2 & 3
and the head of England’s test-and-trace ‘vision and narrative’,” said Munira Editorial Comment page 20
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AUGUST 20 2020 Section:FrontBack Time: 19/8/2020 - 20:05 User: julian.summers Page Name: 1FRONT, Part,Page,Edition: LON, 1, 1
2 ★ FINANCIAL TIMES Thursday 20 August 2020
NATIONAL
Post-transition period Public transport
Wales fears law spells Union’s demise Freeze on rail
fares weighed
to lure back
Cardiff views internal grab” by the devolved administrations parliament last month, Mr Sharma said environmental standards for Wales and plastics, whereas in England only three passengers
in Scotland and Wales. While the pro- the legislation would give “regulatory Scotland. Mr Miles said the Welsh were prohibited.
market white paper as
independence Scottish National party clarity and certainty” to British compa- administration’s initial view that the Other potential areas where the pow-
attack on devolution holds power in Edinburgh, there is a nies after the end of the Brexit transition paper was “fundamentally flawed and ers of the devolved administrations
pro-Union, Labour-led administration misleading” had been confirmed by a could be pared back include building
in Cardiff. ‘The Welsh government is subsequent detailed analysis. regulations, teaching qualifications and Philip Georgiadis and Laura Hughes
Peter Foster
In a letter to Alok Sharma, UK busi- He added that the proposed approach food standards, added the analysis.
concerned the long-term The government is eyeing a freeze on
Plans by Boris Johnson’s government to ness secretary, Welsh Brexit minister from the Westminster government, if Daniel Wincott, professor of law and
rail fares in an attempt to coax people
pass legislation to underpin a new UK Jeremy Miles accused Westminster of survival of the UK followed through, would “represent a society at Cardiff University, said the
back on to trains as passenger numbers
internal market at the end of the Brexit undermining the established norms of direct attack on the current model of unusually strong language from Mr
is under great strain’ remain heavily depressed following the
transition period will “accelerate the consultation with the devolved admin- devolution”. The legislation envisaged Miles should give the Westminster gov-
slump after the coronavirus lockdown.
break-up of the Union”, the Welsh istrations. “The Welsh government is in the white paper was “unnecessary, ernment pause for thought.
administration has said. concerned that the long-term survival period, when the UK will no longer fol- unworkable [and] heavy-handed” and “The Johnson administration has Officials confirmed ministers were
The stark warning was issued follow- of the United Kingdom is under great low thousands of rules and standards set would not secure consent from the learnt to dismiss robust language from looking at scrapping the annual rail fare
ing a review by the Welsh administra- strain and that the approach taken in in Brussels. Welsh parliament. the Scottish government,” he added. increase in January but no decision had
tion of the Conservative government’s the white paper will exacerbate those Among the most contentious propos- Mr Miles highlighted how the legisla- “When their internal market proposals yet been made as the government con-
white paper outlining plans for the UK tensions in a way which, if not als was a scheme to impose the “mutual tion could clip the wings of the Cardiff are also comprehensively rejected from tinued to grapple with multiple issues
internal market. addressed, will accelerate the break-up recognition” of products in all parts of parliament in multiple areas. The Welsh Cardiff, perhaps it is time for the UK thrown up by the pandemic.
The document published last month of the Union,” said Mr Miles. the UK, in effect allowing Mr Johnson’s administration had decided to mirror government to reconsider.” “It’s in the mix,” said one official. “It’s
was denounced at the time as a “power Presenting the white paper to the UK government to unilaterally set food and an EU directive banning nine single-use FT Big Read page 19 a negotiation and not a decision for now.
We need to look at projections and wait
and see the landscape.” A possible freeze
on fares was first reported by The
Times.
Peerless
Annual ticket price rises for regulated
fares, including season tickets, are based
PM bats for on the retail price index for July, which
was published yesterday and increased
1.6 per cent last month.
York in vain
A decision on fares is expected to be
taken over the next few months, with
the government locked in negotiations
with rail companies over a long-term
coronavirus rescue package to help
Boris Johnson’s idea to move the them survive well into next year.
House of Lords to York, pictured, Train companies have already
during refurbishment of the Palace of received £3.5bn in state support after
Westminster has been rebuffed by ministers in effect nationalised Britain’s
parliamentary authorities. railways in a single stroke under sweep-
The prime minister mooted ing emergency powers. The measures,
temporarily moving the upper which suspended the franchise model
chamber as part of his agenda to and instead pay the operators a small
“level up” the country. The palace is management fee, expire next month.
to undergo a £4bn restoration that The industry is expecting changes to
will see MPs and peers leave for the support measures when they are
several years. Mr Johnson asked renewed, including contracts tailored to
parliament’s restoration and renewal specific franchise routes rather than the
programme to consider York as a one size fits all model rushed through at
possible location for the Lords. the height of the crisis.
Sarah Johnson, chief executive of But Chris Heaton-Harris, the rail min-
the restoration delivery body, said it ister, did not rule out a total freeze on
had been told by the Speakers of the fares next year. “We expect any rail
Lords and Commons “the location of fares rise to be the lowest in four years
the Houses is a matter for come January and any increase will go
parliament, it does not form part of straight to ensuring crucial investment
the programme’s scope, and in our railways,” he said.
consequently would be inappropriate He added that the government recog-
for us to explore further”. nised the impact coronavirus had had
Sebastian Payne on how people travelled, and the rail-
ways needed to “offer more convenient
and better value options for everyone”.
Ian Lamond/Alamy.
This year fares rose 2.7 per cent, based
on the RPI in July 2019, but inflation has
cooled during the past 12 months.
Testing The number of passengers on the rail-
ways has recovered to only about a third
Covid-19 infection survey to be expanded across the UK
of normal levels, having fallen to less
than 5 per cent during lockdown earlier
in the year when people were told to stay
at home.
Campaigners and transport lobby
Clive Cookson and Laura Hughes followed by a slight increase during July said Ian Diamond, the UK’s national during a home visit by a health worker. the mass testing programme. “This is a groups are pushing for radical reform of
and a levelling off so far in August. statistician. The swab tests show whether or not peo- really, really important drive that we the rail ticketing system following the
England’s largest coronavirus infection
Last week the agency said with 95 per Letters are being sent to tens of thou- ple have the virus. have across government to bring in collapse in passenger numbers.
survey will expand more than fivefold
cent confidence the number of people sands of households inviting their par- In addition, 20 per cent of partici- mass testing, population-wide testing,” Anthony Smith, chief executive of
in the next two months to test 150,000
who had the virus in England was in a ticipation, with north-west England a pants aged 16 and over provide a blood Mr Hancock told the BBC. Transport Focus, the passenger watch-
people every fortnight as health
range of 19,000 to 40,700. This estimate sample. These tests help determine He said ministers were working “as dog, urged the government to do more
experts prepare for a surge of cases in
was based on just 58 people in the ONS ‘The extra data on the what proportion of the population has fast as we can” with dozens of home- than freeze fares and offer more flexible
the autumn.
sample testing positive for the virus developed antibodies to the virus. Par- grown and international companies to season tickets and cut-price deals.
spread of infections and
The Office for National Statistics said over the previous six weeks. ticipants will be asked to give further get the “very best” testing capacity. “People’s feelings about travel, and
the initial boost to the sample size from The survey is designed to establish antibodies at local level blood monthly for the next year. Declining to put a date on when the the way they use public transport, have
the current 28,000 would be in place by community infection levels, outside Katherine Kent, ONS lead analyst, pledge would be fulfilled, he said: “We’ll changed,” he said.
will be invaluable’
October, but it planned eventually to care homes and hospitals. said if the survey carried on for two ramp it up, certainly over the remainder Pointing to help for other sectors such
involve 400,000 people in England. The ONS said the expansion would years at the planned scale, it would cost of this year. I’m not going to put a firm as the “eat out to help out scheme”, the
The statistical agency, which runs the enable it to make far more accurate esti- particular regional priority. “If you’ve around £750m. But the study would be deadline on it.” watchdog said its research showed two-
survey with Oxford university, will also mates, particularly at local level when been approached to take part then assessed periodically and discontinued The government has previously thirds of people who previously com-
extend the project to Scotland, Wales flare-ups occurred. please do so,” Sir Ian said. “You will be if it was found to no longer be useful. promised to expand testing capacity to muted by train expected to work from
and Northern Ireland. “Vigilance is key to containing this helping us all to contain this terrible Separately Matt Hancock, health sec- 500,000 a day by October to try to keep home more regularly in future.
The ONS survey has been too small to pandemic and the extra data on the virus and get on with our lives.” retary, pledged to introduce population- a lid on the disease and avoid a return to The Campaign for Better Transport,
give strong statistical confidence in its spread of infections and antibodies at Participants provide samples from wide mass testing as lockdown restric- tougher lockdowns. According to gov- another lobby group, said any fare rises
findings beyond a general trend down- local level will be invaluable to the plan- self-administered nose and throat tions continue to be eased across Eng- ernment data, just over 150,000 tests would be a “missed opportunity” to
ward in infections from April to June, ning of effective local responses,” swabs and answer a few short questions land. The ONS survey is independent of were carried out in the UK on Tuesday. encourage people back to rail travel.
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AUGUST 20 2020 Section:World Time: 19/8/2020 - 19:47 User: david.owen Page Name: UKNEWS1, Part,Page,Edition: LON, 2, 1
Thursday 20 August 2020 ★ FINANCIAL TIMES 3
NATIONAL
Coronavirus
speeds charge
towards virtual
war gaming
Digital replica of country will test resilience
to pandemics, disasters and enemy attack
Helen Warrell Matrix”, in reference to the science fic-
Defence & Security Editor tion film in which humans exist inside a
Defence chiefs are seeking to fast-track simulated reality. Real-world uses could
new virtual reality technology devel- range from predicting the damage from
oped by a British gaming company to natural disasters such as floods to calcu-
create a digital replica of the country, lating the effect of a cyber attack against
arguing this would help test resilience to a power station or presenting simulated
future pandemics, natural disasters and hostage rescue scenarios to the govern-
attacks by hostile states. ment’s Cobra emergency committee.
The Ministry of Defence has already “This would have been really useful in
spent more than £25m on contracts understanding the spread of the pan-
with software developer Improbable — demic, measuring the effect of meas-
which has pioneered the technology — ures taken to inhibit it, and improving
to investigate its potential. public communications — a key enabler
Insiders say the government’s difficul- to doing a better job of managing the cri- Inside ‘The unit was struggling to bring together the which allows military chiefs to run ‘Clearly you lates real life,” Ms Braw said. “If you
ties in co-ordinating national data and sis,” said Richard Barrons, former head Matrix’: information it needed from across the “thousands” of complex simulations want to simulate societal meltdown as a
can’t have
responses during the coronavirus crisis of Britain’s joint forces command. “We a mock-up UK. over and over again, refining the param- result of coronavirus it’s not enough to
have persuaded ministers of the bene- still need one for whatever [crisis] hap- shows how The concept is viewed favourably by eters each time. “What we’re aiming for perfect have the software, you have to have the
fits of the system, known as a “single pens next.” the synthetic Dominic Cummings, the prime minis- in the longer term is . . . to enable gov- details on what would happen, the data
knowledge
synthetic environment”, which is now Sir Richard, who is affiliated with environment ter’s chief of staff, who wants to use the ernments to test ideas and test choices inputs. Clearly you can’t have perfect
likely to be accelerated in autumn’s inte- both Improbable and CAE, a Canadian might be used integrated review of security, defence, of action in a virtual world before imple- beforehand knowledge beforehand of what would
grated defence and security review. company that provides simulation tech- Improbable development and foreign policy — due menting them in the real world,” he happen in a crisis but you have to have
of what
The technology works by generating a nology for the system, added it would to report in November — as an opportu- said. lots of details which would give you the
virtual “twin” of any location by layer- “dramatically improve” the ability of nity to boost investment in innovative Improbable, which is backed by would closest approximation of what would
ing maps of geographical terrain and UK military chiefs to “solve complex technologies instead of traditional mili- Japan’s SoftBank, has also pitched its then happen,” she said.
happen in
critical infrastructure with details of problems in real time, take better deci- tary hardware. single synthetic environment to senior The project also presents a potential
fuel, power, and water supplies as well sions, and conduct more decisive and The MoD’s eventual aim would be to Nato commanders. The US military is a crisis’ security risk: Sir Richard admitted that
as telecoms networks, supermarket dis- efficient operations”. build simulations of likely conflict zones developing similar augmented reality a digital simulation of the UK, or any
tribution systems and weather patterns. “It would also make a lot of training — such as the Baltic nations bordering war gaming technology. country, would be an obvious target for
This can be combined with locations of far more challenging and much cheaper Russia — and Improbable’s prototype is But Elisabeth Braw, director of the “criminals, and hostile powers, and
where people are, based on phone sig- than trying to replicate conflict situa- based on one of the Baltic countries as a modern deterrence programme at Lon- indeed, just competitors”.
nals, and what they are thinking about, tions in the real world,” he said. proof of concept. However, the pan- don-based defence think-tank the Royal UK Strategic Command’s first con-
gleaned from social media. The idea gained currency with senior demic has focused minds on boosting United Services Institute, warned tract with Improbable was worth
The final product uses artificial intel- figures in Downing Street including resilience at a national level, and insid- against getting “prematurely excited” £11.9m last year and the company was
ligence to simulate future scenarios and Mark Sedwill, the outgoing cabinet sec- ers say the immediate priority will be by the idea of the single synthetic envi- granted another £11.5m this year.
allows operators to “war game” their retary and national security adviser, building a “digital twin” of the UK. ronment, saying its success would rely The British Army also has a smaller
responses. Herman Narula, Improba- and Michael Gove, Cabinet Office minis- Joe Robinson, chief executive of on accessing high quality data to train £2.3m deal with Improbable and is
ble’s chief executive, has in the past jok- ter, at the height of the pandemic when Improbable’s defence arm, described the algorithm. involved in testing the synthetic envi-
ingly compared this to “building The the government’s Covid-19 response the technology as a “what-if machine”, “The real test is whether this assimi- ronment software.

AUGUST 20 2020 Section:World Time: 19/8/2020 - 19:39 User: david.owen Page Name: UKNEWS2, Part,Page,Edition: LON, 3, 1
4 ★ FINANCIAL TIMES Thursday 20 August 2020
INTERNATIONAL
Eastern Europe Africa coup
EU leaders urge Belarus reform from within Mali army
rebels pledge
election after
Bloc agrees sanctions but sible for violence, repression and fraud reporters after the EU teleconference. ordered patrols to be stepped up on Kremlin spokesman Dmitry Peskov
stops short of seeking around the “neither free nor fair” polls. “This must be achieved through dia- Belarus’s borders, and told the interior said Russia wanted to prevent “external overthrowing
The calibrated message after an logue within the country. There can be ministry to crack down again on pro- influence” in Belarus and blamed
president’s resignation online EU summit yesterday reflects no interference from outside.” testers. “There should be no more riots unnamed foreign governments for
president
leaders’ desire to denounce rights The leaders stopped short of calling in Minsk of any kind,” he told a meeting “unacceptable meddling”.
abuses but avoid giving Russia an for Mr Lukashenko to step down or urg- of Belarus’s state security council, Despite Mr Lukashenko’s affirma-
Michael Peel — Brussels
excuse to intervene in the most serious ing tougher measures than the sanc- according to the state-run Belta news tions of Russian military support, Mr
James Shotter — Warsaw
Max Seddon — Moscow challenge yet to Mr Lukashenko’s 26- tions process already launched by EU agency. “People are tired, people Peskov said there was “no need” for a
EU leaders have condemned the Belarus year rule of the former Soviet state. foreign ministers last week. The video demand peace and quiet.” Russian intervention. He said Moscow Neil Munshi
elections as unfair but stressed that any Opposition leader Svetlana Tik- summit took place a day after Ms Mer- Ms Tikhanovskaya, who fled to recognised Belarus’s contested election West Africa Correspondent
political change from the authoritarian hanovskaya appealed earlier in the day kel, Mr Michel and French president Lithuania after the polls, had appealed results, even as foreign minister Sergei Soldiers who led Mali’s coup and ousted
rule of President Alexander Lukash- to EU leaders to “support the awaken- Emmanuel Macron held talks on the for the EU to reject “fraudulent” results Lavrov admitted they were “not ideal”. the president said yesterday they
enko must come from within the coun- ing” of her country, while stressing the Belarus crisis with Russian president and swing behind efforts for a peaceful Mr Lukashenko claimed the opposi- would set up a transitional government
try rather than outside interference. need to respect the sovereignty of Bela- Vladimir Putin. transition of power. tion was funded from abroad, and and hold elections in the west African
Charles Michel, European Council rus and the choice of its people. Mr Lukashenko, who has faced huge Police yesterday detained at least two warned the EU not to meddle in Bela- country, which is a key western ally in
president, said the EU rejected impu- “For us, it’s quite clear that Belarus protests and strikes since claiming a dis- people at a car plant strike and sealed off rus’s affairs. the fight against jihadism in the Sahel
nity and would impose sanctions on a must find its own path for itself,” Angela puted victory in the election on August a theatre in Minsk, a focal point for pro- Additional reporting by Guy Chazan, Berlin region of northern Africa.
“substantial number” of people respon- Merkel, Germany’s chancellor, told 9, struck a defiant tone yesterday. He tests after its director was sacked. See Lex
Ibrahim Boubacar Keita, the former
president, had been the target of weeks
of mass street protests against what crit-
White House race. Foreign affairs ics say has been seven years of corrupt
and inept rule, before a group of soldiers
detained him and other senior govern-
Harris nomination presents challenge to Modi
ment and military officials on Tuesday.
“If elements of the army felt com-
pelled to intervene to bring an end to
this — do I really have a choice?” Mr
Keita said in a nationally televised
Support: an address announcing the dissolution of
Biden’s part-Indian choice for
artist in Mumbai parliament and his government hours
vice-president is likely to speak paints a after mutineering soldiers arrested him
poster of at gunpoint. “I don’t want a single drop
out against Hindu nationalism congratulations of blood to be shed to keep me in power.”
for Kamala After Mr Keita’s resignation, soldiers
Harris’s calling themselves the National Com-
Amy Kazmin — New Delhi nomination last mittee for the Salvation of the People
Joe Biden’s choice of Kamala Harris, the week. Below, addressed the nation. “We are not hold-
daughter of Indian and Jamaican immi- her mother, ing on to power, but we are holding on to
grants to the US, as his Democratic run- Shyamala the stability of the country,” said Ismael
ning mate in November’s presidential Gopalan, left, Wague, the deputy chief of staff of the
election has sent a frisson of excitement during a civil air force. “This will allow us to organise
across India. rights protest within an agreed reasonable timeframe,
Bollywood superstar Priyanka Cho- in California general elections to equip Mali with
pra praised the choice of Ms Harris, strong institutions.”
Indranil Mukherjee/AFP/Getty;
whose mother came to the US as a PhD Kamala Harris campaign/AP The African Union condemned the
student in the late 1950s, as “a historical, coup, as did France, the US and UN.
transformational and proud moment West African bloc Ecowas announced
for all women”. sanctions, including suspending trade
In New Delhi, journalists laid siege to and closing borders with Mali.
the home of Ms Harris’s uncle, retired Before Mr Keita’s resignation, Mali’s
academic and specialist in US politics opposition group M5-RPF suggested it
Gopalan Balachandran, who opined supported the mutiny, which spurred
that the women of his family were hundreds of people to gather in the capi-
always stronger than the men. tal, Bamako, to celebrate. It remains
In southern Tamil Nadu state, where unclear what role Mahmoud Dicko, the
the family’s roots lie, giant billboards Salafist imam who leads the M5-RPF
with Ms Harris’s face appeared, pro- coalition, will play in any transition.
claiming “PV Gopalan’s granddaughter The mutiny echoed a 2012 coup that
is victorious”. Industrialist Anand Mahi- also began at Kati military base outside
ndra tweeted that Ms Harris “epito- Bamako and ended with the resignation
mises what the world should be — bor- ini Haidar, diplomatic editor of The ‘The Indian-American Congresswoman minded Indian-Americans are also of President Amadou Toumani Touré.
derless and interracial”. Hindu newspaper. “A Democrat estab- Pramila Jayapal, who had been critical uncomfortable at India’s rightward François Conradie, senior political
question of
But while many may thrill to the pros- lishment will be much more vocal about of Mr Modi’s Kashmir policy, from a lurch under Mr Modi. economist at NKC African Economics,
pect of an Indian immigrant’s daughter human rights, civil rights, internet bans, rights and briefing he was holding on Capitol Hill. Ms Harris’s Indian-born mother, pointed out that it took 16 months
just a heartbeat away from the US presi- privacy issues as well as minority Rudra Chaudhuri, author of Forged in Shyamala Gopalan, a cancer researcher before Mr Keita was elected after that
human
dency, New Delhi’s foreign policy estab- freedoms. Mr Trump has by and large Crisis: India and the United States Since who died in 2009, was radical for her coup, during which time jihadis cap-
lishment is apprehensive about how a given this government a free pass.” rights will 1947, said conditions in Kashmir and time, breaking taboos with her involve- tured northern Mali, prompting a
potential new occupant in the White Ms Harris has already raised some of other civil liberties issues would gain ment in the US civil rights movement French intervention that continues
be brought
House might respond to the aggressive these issues. She expressed concern more prominence in the US-India rela- and marriage to a Jamaican. today with 5,000 troops on the ground.
pursuit of a Hindu nationalist agenda by about conditions in India’s Muslim-ma- up into the tionship if Mr Biden were elected. Amitabh Mattoo, a professor of inter- “In the short term, there is no reason
Prime Minister Narendra Modi that has jority Kashmir region after Mr Modi’s “The question of rights and human national relations at New Delhi’s Jawa- to expect an improvement in the secu-
spotlight’
deeply alienated the Muslim minority. government last year revoked its state- rights will be brought up into the spot- harlal Nehru University, said her elec- rity situation — to the contrary, the
Over the past four years, Mr Modi has hood, arrested its politicians and sus- light and will be part of the conversa- tion would captivate the Indian-Ameri- jihadist networks in the north of the
Rudra
forged a strong personal rapport with pended nearly all telecommunications. tion,” he said. “For Biden and Kamala can community and reaffirm India’s country will see a gap to extend their
Chaudhuri
US president Donald Trump who has She was outraged when S Jaishankar, Harris, what distinguishes American deep-rooted affection for and admira- influence while the situation in Bamako
paid little heed to allegations of rising India’s foreign minister, tried to exclude leadership in these changing geopoliti- tion of America. “It’s the coming of age is uncertain and the French do not have
authoritarianism and repression of cal times partially rests on the position of the Indian diaspora,” he said. a civilian interlocutor,” he said in a
minorities and dissent by India’s ruling America takes on rights.” Mr Balachandran says his niece research note.
Bharatiya Janata party. Relations between the US and India would, as vice-president, be a friend to One factor in frustration with Mr
The bonhomie was on display last have been transformed since their India — but not uncritical of New Delhi. Keita’s government had been its failure
year at a political rally in Houston, prickly cold war encounters. Today, “It seems people think that somebody to contain violence in central and north-
where Mr Modi appeared to endorse Mr Washington and New Delhi are strategic of Indian extraction should say, ‘hail to ern Mali, that has killed thousands and
Trump’s re-election bid. and defence partners, bound by shared India’, whatever India does,” he said. displaced millions. France, the former
A Democratic administration would concerns about an increasingly asser- “But no right-thinking Indian would say colonial power, has been leading the
be likely to take a far greater interest in tive China and tied together by a 4m- that. A true friend will say when you are effort to beat back extremist groups.
Mr Modi’s domestic policies and push strong Indian-American diaspora. doing something that is not good for The military junta “was quick to
India to live up to its oft-proclaimed But frictions remain — Mr Trump has you. She will speak her mind, but she express readiness to work with France,
democratic ideals, say analysts. “It taken a hard line towards India on trade, will not be dogmatic.” so I don’t think France’s efforts are jeop-
would certainly be more comfortable last year withdrawing its preferential Mr Chaudhuri said: “Larger strategic ardised, but it will be a challenge”, said
[for the Modi government] if they had access to the US market over concerns sense will prevail. India needs America Arthur Boutellis, senior adviser at the
four more years of Trump,” said Suhas- about protectionism. Many liberal- as much as America needs India.” International Peace Institute.
Public health
Coronavirus outlier Sweden chooses its own path on masks
FRIDAY31MARCH2017 WORLDBUSINESSNEWSPAPER UK£2.70ChannelIslands£3.00;RepublicofIreland€3.00
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masks would change the game when it sity said research had suggested that at believed they should recommend their
comes to Covid-19,” Anders Tegnell, Denmark’s current infection rate use on public transport in Sweden but
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Sweden’s state epidemiologist, told the 100,000 people would have to wear face for a set period. “It would increase com-
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Financial Times. masks properly for a week to avoid one pliance if people know it’s only for three
With newspaper delivery, you start the day prepared.* With FT.com, Mr Tegnell has been branded stub- infection. “If there’s very little virus in months,” he added.
you’re on top of the news throughout the day. And with mobile born by some for again refusing to fol- the community, the effect is limited. But Mr Tegnell himself is keeping an open
and tablet access, you’re up to speed wherever you are. low most of the continent. But infec- if you’re in the middle of a hotspot, then mind. “Face masks can be a comple-
tious disease specialists say there are everything says that they can have an ment to other things when other things
reasons why Sweden has so far resisted effect. In Denmark, we have compro- are safely in place. But to start with hav-
their use for the general population. mised and said face masks may be ing face masks and then think you can
Jonas Ludvigsson, professor of clinical another tool in the toolbox,” Prof Palu- crowd your buses or your shopping
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epidemiology at Karolinska Institute in dan said. malls — that’s definitely a mistake,” he
Stockholm, said one was the way the Another reason for Swedish reluc- said, adding that countries such as Bel-
*Terms and conditions can be found at www.ft.com/subscribenow country was governed. In Sweden, inde- tance, according to experts, is high trust Stockholm: Sweden has resisted gium and Spain with widespread mask
pendent bodies such as Mr Tegnell’s in the authorities. “When the Swedish recommending face coverings use still had rising infection rates.
AUGUST 20 2020 Section:World Time: 19/8/2020 - 19:21 User: david.owen Page Name: WORLD1, Part,Page,Edition: LON, 4, 1
Thursday 20 August 2020 ★ FINANCIAL TIMES 5
INTERNATIONAL
Global Insight
Contact tracing
Mexico
Fears raised over virus apps’ efficacy
Michael
Stott
Almost universal uptake of UCL’s Institute of Health Informatics. that this would be the panacea that ‘We can’t at the Robert Koch Institute. However,
One study reviewed by UCL found would enable us to get back to normal that still represents only a fifth of Ger-
needed alongside manual that as much as 95 per cent of the popu- and forget about Covid — and if we could see it many’s population of more than 80m, Corruption probe is
programmes, study finds lation would have to install the app to get this right, it would solve all of our as a silver falling far below the uptake UCL’s
reduce the R number. “We can’t see it as problems,” she said. research suggests is needed for reliable manna from heaven
bullet’
a silver bullet,” Ms Braithwaite said. Some countries, such as South Korea, tracking. In Switzerland, 1.4m people
Tim Bradshaw
UCL’s findings, which are primarily have been effective in using contact are actively using its SwissCovid app,
Isobel
Contact-tracing apps will fail to stem the drawn from 15 relevant studies of apps tracing to stem the spread of coronavi- out of a population of about 8.5m. for López Obrador
Braithwaite,
spread of coronavirus without almost designed to track Covid-19 and other rus. However, those systems include an UCL Ms Braithwaite said countries with a
universal uptake and substantial invest- infectious diseases such as Ebola, were extensive trawl of data from other lower penetration rate “may still be get-
ment in manual track-and-trace pro- published in Lancet Digital Health. sources, such as security cameras and ting a benefit” by reducing the burden
grammes, say researchers at London The researchers’ warning comes as credit card transactions, as well as on manual contact tracers, but added of
university UCL. the UK government last week smartphone apps that use wireless sig- Germany: “We don’t have any clear P owerful leaders are fond of corruption investi-
A review of more than 4,000 research announced it would resume testing a nals to detect who might have encoun- sense of what contribution the app may gations as a method for eliminating rivals.
papers published over the past 20 years new contact-tracing app, after abandon- tered an infected individual. have made.” Instead of low political score-settling, they sug-
found that Covid tracking apps would ing its original version in June. Many developed countries have One study the UCL team reviewed gest an appeal to the moral high ground. Think
reduce the reproduction, or “R”, Politicians around the world over- turned to the proximity notification sys- found that manual contact tracing — of Xi Jinping’s purges. Or Vladimir Putin’s
number only if they were adopted by hyped contact-tracing apps in the early tem developed by Apple and Google. where researchers were tasked with imprisonment of Mikhail Khodorkovsky, once Russia’s top
more than three-quarters of the popula- days of the pandemic, Ms Braithwaite Among the most widely deployed is tracking down everybody an infected oligarch, on fraud and tax charges. Mexico’s populist presi-
tion and used in conjunction with “large told the FT. “Certainly it was my percep- Germany’s Corona Warn app, which had individual had met in the days leading dent Andrés Manuel López Obrador appears to have taken
scale” manual contact tracing, said the tion during that April lockdown period been downloaded 17.2m times as of up to their diagnosis — was able to a leaf from their book. Like Messrs Xi and Putin, he has
study’s lead author, Isobel Braithwaite that governments wanted to suggest August 17, according to its developers reduce R by more than apps. made the campaign against corruption a signature theme,
and the main targets have been political opponents.
In his boldest move to date, Mr López Obrador has called
upon two former presidents from opposition parties,
Middle East. Diplomacy Enrique Peña Nieto and Felipe Calderón, to testify in a
scandal over alleged bribes paid by the state oil company
Pemex. Emilio Lozoya, a former Pemex chief executive
US targets Saudi Arabia for next Israel deal
facing charges of money laundering, is co-operating with
prosecutors. Almost daily, salacious leaks from what is
said to be his testimony fill the Mexican press.
Let there be no mistake: a clean-up of Mexico’s political
system is overdue. For decades, corrupt politicians have
accumulated wealth by milking a system that is rotten
Riyadh appears unlikely to
even by the region’s low standards. Transparency Interna-
follow UAE in normalising tional’s annual corruption perceptions index ranks OECD
nation Mexico in 130th place, tied with Mali and Myanmar.
relations with Jewish state But the way in which Mr López Obrador has pursued his
anti-corruption crusade has raised multiple red flags. Tes-
timony from a confidential investigation is drip fed to the
Katrina Manson — Washington media almost daily, conveniently offering the president an
Ahmed Al Omran — Jeddah
opportunity to comment on a process that should be sub
No sooner did the United Arab Emirates judice. The most explo-
make a historic decision to normalise sive allegations compro- Evidence of
relations with Israel than the US spot- mise opposition politi-
corruption within
light turned to a more significant — and cians, while evidence of
elusive — target: Saudi Arabia. corruption within Mr the government
Jared Kushner, Donald Trump’s son- López Obrador’s govern-
has gone mostly
in-law and the man who helped broker ment has gone mostly
last week’s deal, has set his sights on unpunished. unpunished
convincing America’s chief Arab ally to Manuel Bartlett, the
take the landmark step. Yet despite his head of the state electric-
close relations with Crown Prince ity company, denied accumulating undeclared properties.
Mohammed bin Salman, it remains a He was exonerated in a probe conducted by a minister who
much tougher ask. was herself accused of accepting a plot of land from the city
“Saudi Arabia is the game,” said Bruce government and acquiring several properties while on an
Riedel, a former CIA officer who special- academic’s salary. She denies wrongdoing.
ises in the Gulf kingdom. But with King The timing of the Pemex case is fortuitous. Mr López
Salman “a true believer in the Palestin- Obrador’s ratings were slipping, hurt by his disastrous
ian cause”, it was unlikely to happen any handling of the pandemic and by one of the emerging mar-
time soon. ket world’s worst recessions. Voters in next year’s midterm
Since Mr Trump entered the White elections threaten to rob him of his congressional majority.
House, his son-in-law has forged close “The priority is to distract from what is going on, which
relations with a new generation of Gulf White House have the final say on some key issues. legal position of East Jerusalem”. Pales- tion, particularly in security and intelli- is all very negative,” said Andrés Rozental, a former dep-
leaders: the UAE’s Sheikh Mohammed visit: Jared The king told Palestinian leader Mah- tinians want East Jerusalem to be the gence, with Israel in recent years, as it uty foreign minister. “It’s a circus for the people.”
bin Zayed, and Saudi Arabia’s crown Kushner stands moud Abbas in a phone call in January capital of any future state. shares the Jewish state’s concerns about So far, the strategy seems to be working. Mr López Obra-
prince. Mr Kushner has shared long, among officials that the kingdom remained committed “King Salman has a very strong place Iran’s role in the region. Brian Hook, the dor’s popularity has begun to pick up as the Lozoya allega-
late-night sessions with Prince Moham- in the Oval to the Palestinian cause and Palestinian in his heart for the Palestinian people US’s Iran envoy, told the Financial tions knock the coronavirus death toll off the front pages.
med and stood by him after intense per- Office during a rights, according to a readout published and for the cause, and MBS does as Times that “Iranian aggression” had The opposition is in disarray: a conservative governor has
sonal criticism following the 2018 kill- Saudi trip by the state news agency. well,” Mr Kushner told reporters on helped unite some countries in the face dismissed his secretary after the man appeared in a video
ing of Saudi journalist Jamal Khashoggi. to the US two When Mr Trump rolled out his peace Monday. “They do want to see the Pales- of a common enemy. purporting to show him counting bundles of Pemex cash.
“I’ve had many discussions now with years ago plan, which foresees Jerusalem as the tinian people have a state.” Prince Faisal A senior Trump administration offi- Mr Calderón has not commented on the allegations but
MBS about . . . [the possible normalisa- Jabin Botsford/Washington Israeli capital and which was rejected by bin Farhan, Saudi’s foreign minister, cial tipped Bahrain and Oman as most has accused Mr López Obrador of waging a campaign of
tion of relations], and also with King Sal- Post/Getty Images the Palestinians, it was publicly repudi- yesterday cautiously welcomed the likely to normalise relations with Israel persecution. Mr Peña Nieto has not spoken publicly.
man,” Mr Kushner, the US president’s ated by King Salman. Even with the UAE-Israel agreement, saying it “could next, with Morocco also on the cards. But improving his ratings and keeping his majority are
Middle East adviser, told reporters on close relationship between Mr Kushner be viewed as positive”, but refrained Israeli foreign minister Gabi not enough for Mr López Obrador. His real aim is to
Monday, and said it would be “very and Prince Mohammed, Saudi Arabia from giving its outright backing. Ashkenazi spoke with his Omani coun- remake Mexico, sweeping away the free-market, pro-busi-
good” for Saudi business and defence. was a notable absentee from a flagship A person familiar with Riyadh’s terpart on Monday about the need to ness policies of the past four decades and replacing them
He argued it would also help the Pales- economic conference organised by Mr thinking said Saudi Arabia was “very strengthen relations. with a vision of state-led development from the 1960s.
tinian people. Kushner to support the peace deal. different” to the UAE, despite their close The official told the FT “no one “López Obrador’s agenda is clear: he will go after the
Prince Mohammed, who is pushing Saudi leadership in the Islamic world ties. “It’s smaller and doesn’t have that knows” if Saudi Arabia would take the period of history he considers an aberration,” said Thomas
ahead with plans to reform the king- also makes it much less likely the king- religious element. What the UAE has to breakthrough step. “Each step increases Shannon, a former US state department official.
dom’s economy, was perceived to be dom will follow in the UAE’s footsteps. lose is much less than us, and what they the confidence this is the direction the Key to this agenda is a reversal of the historic reforms
willing to encourage the Palestinians to The kingdom hosts Islam’s two holiest have to offer Israel is much less,” the region needs to go,” said the official. passed under Mr Peña Nieto, which opened oil exploration
accept the US Middle East peace plan as sites and portrays itself as the leader and person said. “If you ask a 30-year-old Most remain sceptical that the Saudis to foreign investment. If Mr López Obrador can show
part of his efforts to cement his relation- defender of Sunni Islam. King Salman, Saudi, they may say ‘Why not have rela- will follow the UAE’s lead. “There is no bribes greased the passage of the reforms, he can destroy
ship with the Trump administration whose official title is Custodian of the tions with Israel? They have great tech- incentive to do it with annexation [of their legitimacy. “He wants to totally discredit the energy
and with the wider US political estab- Two Holy Mosques, told the Organisa- nology and academia.’ But they would occupied territories] already off the reforms and the education reforms,” said Raymundo Riva
lishment, western diplomats and ana- tion of Islamic Co-operation last year care if we actually did because the whole table [as part of the UAE/Israel deal],” Palacio, a leading Mexican political commentator, of the
lysts in the region have said. the Palestinian cause remained a core Muslim world would lambast us.” said Mr Riedel. Pemex corruption probe. “This is totally political.”
But he is believed to have been over- issue and that the kingdom “refuses any Saudi Arabia, like the UAE, is believed Additional reporting by Andrew England in
ruled by his father, who is understood to measures that touch the historical and to have increased its covert co-opera- London and Ilan Ben Zion in Jerusalem [email protected]
Latin America Disinformation
Brazil’s once-mighty Workers’ party struggles for support Facebook accused of failing
to tackle medical hoaxes
Bryan Harris — Sao Paulo this has definitely not been the case,” Foundation. “It speaks to concerns of would reach the run-off in the two-
said Mario Marconini, a managing specific groups. And it doesn’t inspire round system, the party appears to lack
When Brazil’s former president Luiz
director with Teneo in Brazil. “The PT is Bolsonaro to change course.” the support it needs to defeat Mr Bol-
Inácio Lula da Silva said his Workers’
suffering from a disease: they cannot tell The party underlined its leftward sonaro. A poll conducted by Veja, a mag- Dave Lee and Hannah Murphy harmful information — such as sup-
party was preparing to boot Jair Bol-
Lula to move away or just forget Lula. shift last month by hosting an event azine, last month showed he would eas- San Francisco posed cures for Covid-19.
sonaro out of office and return to gov-
ernment in 2022 elections, his remarks They should be thinking of something with the leaders of Cuba, Venezuela and ily defeat Mr Lula da Silva. Facebook is failing to curb the rampant Just 16 per cent of the misleading or
elicited more than a few smirks. new. They need a transformation.” Nicaragua. Mr Lula da Silva, mean- An opinion poll in May showed the PT spread of medical disinformation on its false articles analysed by Avaaz dis-
Fernando Bizzarro, a political scien- while, earlier this month described the had the support of almost 14 per cent of platform, with misleading content gen- played a warning label from Facebook’s
For years, the Workers’ party, or PT, was tist at the David Rockefeller Centre for Lava Jato crackdown as an effort by the respondents, compared with 4 per cent erating an estimated 3.8bn views in the third-party fact-checkers.
considered among the most successful Latin American Studies, said: “The US to “block Brazilian sovereignty”. for far-right PSL, the next largest. past year, according to a damning Avaaz called for Facebook to notify
leftwing political movements in Latin party has ceased to be bigger than its The developments are important to While the poll reflects the PT’s endur- report into the social media company. users who had accessed material that
America for its ideologically charged leadership. It has become Lula’s party.” Brazil’s political trajectory because of ing support among a swath of society, it had later been disputed by fact-check-
base and achievements. The party faces a test in municipal the structure of the presidential elec- also speaks volumes to the weaknesses The study from the US-based non-profit ing, and to do more to reduce the viral-
But its reputation was damaged by its elections in November, which present a tions. While the PT’s loyal voter base of the party system. With the exception activism group Avaaz found that the ity of information from sources known
involvement in Brazil’s Lava Jato, or Car chance to win control over local power makes it likely its preferred candidate of the PT, Brazilian parties have served spread of medical disinformation on to be misleading. “This infodemic will
Wash, corruption scandal, as well as a structures. They can be harnessed to as vehicles for winning elections rather Facebook far outstripped that of infor- make the pandemic worse unless Face-
recession. Its last president, Dilma support federal election campaigns in than propounding ideologies. mation from trustworthy sources, with book detoxifies its algorithm and pro-
Rousseff, was impeached in 2016, and 2022. PT president Gleisi Hoffman said The party traditionally enjoyed sup- the most popular “super spreader” sites vides corrections to everyone exposed
Mr Lula da Silva’s bid at a comeback in her party would use the municipal races port in the impoverished north-eastern receiving four times the number of to these viral lies,” said Avaaz campaign
the 2018 presidential race ended after to explain “what the party did for Brazil, region of Brazil. However, even that clicks of bodies such as the US Center director Fadi Quran.
he was jailed on corruption charges. mainly in the area of economic and stronghold has begun to weaken. For Disease Control and the World Facebook said it had not seen Avaaz’s
Since then, the party has floundered social development, and to show itself But Enio Verri, the PT’s leader in the Health Organization. findings, but argued the conclusions did
in opposition, according to political ana- as an alternative government”. lower house of Congress, said: “If the PT The consumption of health misinfor- not reflect the steps Facebook had taken
lysts. They say it has alienated swaths of While candidates are still being final- were not relevant, people would not talk mation on Facebook peaked in April, to limit misinformation.
the electorate with a shift to the far-left ised, few are betting on a leftwing wave. about it as much as they do. I would say when the severity of the pandemic was “Thanks to our global network of fact-
and a focus on resurrecting the popular- “The issue is that the party is now way that the PT is fundamental even to the becoming clear to populations in the US checkers, from April to June we applied
ity of Mr Lula da Silva, who was released more radical than the average Brazilian right wing, because they need to talk and Europe, Avaaz said. warning labels to 98m pieces of Covid-19
last year. voter and it is not even trying to connect about us all the time to survive. Without In that month alone, disinformation misinformation and removed 7m pieces
“When Lula came out of jail, people with them,” said Eduardo Mello, a pro- Gleisi Hoffman: says party will use a doubt we are the great alternative.” sites attracted an estimated 420m clicks of content that could lead to imminent
thought he could resuscitate the PT, but fessor of politics at the Getúlio Vargas local elections to explain its role Additional reporting by Carolina Pulice to pages peddling hoaxes that included harm,” Facebook told the FT.
AUGUST 20 2020 Section:World Time: 19/8/2020 - 19:18 User: david.owen Page Name: WORLD2, Part,Page,Edition: LON, 5, 1
6 ★ FINANCIAL TIMES Thursday 20 August 2020
INTERNATIONAL
Thai students
‘It’s been
described
among
join protest
youth as
symbolic of
the French
movement with
Revolution’s
values of
liberty,
defiant salute
equality
and
fraternity’
Restive youth demand constitutional
change and reform of monarchy
John Reed — Bangkok Nataphol Teepsuwan, Thailand’s edu-
cation minister, said “the government
It is a morning ritual at every Thai understands people’s right to express
school, steeped in tradition and nation- their view” at schools, albeit without
Digital protest: alist decorum: children stand still and disrupting the national anthem. “The
students use the sing the national anthem as the king- government is not going to put any strict
three-finger dom’s blue, white and red flag is raised. guidelines on them expressing their
salute in But this week, amid a growing “Free opinions or gestures. But they should
Bangkok People” youth protest movement, chil- use the student council to express their
yesterday. dren across Thailand raised their hands views.”
Below, a more during the ceremony to make the The wave of protests has been gather-
traditional protesters’ trademark, defiant three- ing momentum since December when
demonstration fingered salute. Future Forward, a youth-backed oppo-
The gesture originated in The Hunger sition party challenging Thailand’s mili-
Athit Perawongmetha/Reuters
Games, the dystopian young adult fran- tary-backed establishment, faced legal
chise of books and films, but has been harassment and was banned. Flash
adopted as an emblem of a movement mobs were held in Bangkok at which the
that has spread from university cam- three-fingered salute was given.
puses to secondary schools. After a lull during Thailand’s corona-
The salute is shocking for a conserva- virus lockdown, the protests re-
tive culture in which respect for elders emerged in June after armed men in
and deference to protocol and govern- Phnom Penh, Cambodia, abducted
ing institutions are taught from a young Wanchalearm Satsaksit, a young Thai
age. In images shared widely on social LGBT and human rights activist who
media, from Bangkok to the poor east criticised Thailand’s royalist status quo.
region to the mostly Muslim deep south, The students have used humour in
children have raised three fingers. their protests and accommodated a
“It has become a peacefully powerful broad range of causes, with LGBT activ-
symbol of anti-authoritarianism,” said ists flying rainbow flags and demonstra-
Viengrat Nethipo, assistant professor of tors organising protests themed around
political science at Bangkok’s Chu- Harry Potter, the Japanese cartoon
lalongkorn University. “Recently it’s hamster Hamtaro, and durian, the pun-
been described among youth as sym- gent tropical fruit. Protesters have
bolic of the French Revolution’s values adopted “Do You Hear the People Sing”,
of liberty, equality and fraternity, so it’s the anthem of the downtrodden from
easily adopted as a symbol.” the musical Les Misérables, as their
The spread of the defiant gesture movement’s hymn.
highlights the extent to which Thai- Older people, including supporters of
land’s restive young people, who are the exiled populist Thaksin Shinawatra,
demanding a new constitution as well as have joined the protests, and organisers
reform of the monarchy, have caught have rebranded their movement from
the kingdom’s arch-conservative, mili- Free Youth to Free People.
tary-backed establishment off guard. The student protesters have moved
The young protesters have bypassed far beyond previous protest move-
Thailand’s curbs on free speech in tradi- ments, including Mr Thaksin’s “Red
tional media and limits on public pro- Shirt” supporters, in the breadth and
tests by harnessing viral, pop culture fearlessness of their demands.
memes on social media and using mes- At a rally last week, students read out
saging apps to organise “flash mobs”. 10 demands to reform the monarchy, an
Schoolchildren have also been tying unheard of and risky step in a country
white ribbons around their wrists or where insulting King Maha Vajiralong-
schoolbags or in their hair as another korn or his immediate family is punish-
symbol of defiance against dictatorship. able by up to 15 years in prison.
Human Rights Watch says students as The 10 demands included revoking
young as 12 have faced school punish- the punitive lèse majesté law and ceasing
ment or police “all public relations and education that
harassment for excessively and one-
flashing the sidedly glorify the
salute. monarchy”.
The UN Chil- The three-fingered
dren’s Fund on salute was first used
Tuesday voiced after the 2014 coup
concern about that brought Prayuth
“the potential Chan-ocha, now
harm that children prime minister, to
may be facing power. The junta had
amid the ongoing banned public gath-
protests in Thailand”, and called erings and speeches. Some
on all parties to uphold chil- Thais adopted the salute
dren’s and young people’s as a defiant gesture. “It’s
right to freedom of fresh, as it has never
expression. been used before in all
Students planned to these colour-coded
picket Thailand’s educa- movements,” said Ms
tion ministry yesterday to Viengrat.
protest at what they see as a Additional reporting by Nang Urai-
surge of intimidation and sin
harassment in schools. See Editorial Comment
Pandemic
Spain records highest level of
Covid-19 deaths since May
Daniel Dombey — Madrid agency published yesterday indicated
that in the previous 14 days Spain had
Spain has reported a jump in the
reported about 131 new Covid-19 cases
number of coronavirus deaths to levels
per 100,000 people, far more than any
not seen since May and infections also
other country. Malta was the only other
rose as the pandemic’s summer resur-
country with a ratio above 100. The
gence in the country gains pace.
level in Spain compared with a ratio of
Government figures published yester- 43 in France and 21 in the UK.
day evening reported 127 more accumu- Madrid, a centre of the outbreak in
lated deaths than the day before and spring, has once again become the focus
6,671 more infections. Spain’s compila- in Spain, reporting more than 2,000 fur-
tion of coronavirus data has been con- ther cases yesterday — although
troversial for months and many of the regional authorities point out they are
new cases may predate the past 24 carrying out large-scale random tests in
hours, owing to lags in reporting. the capital, thus boosting the numbers.
Nevertheless, the latest toll stands out Fernando Simón, the doctor leading
in recent months. The country, which Spain’s effort against the virus, has
experienced a peak of 950 deaths a day maintained the rise is relatively moder-
in early April, has not contended with ate compared with March and April,
more than 100 a day since May. and has been partly fuelled by young
According to the European Centre for people socialising in and around bars, as
Disease Prevention and Control, an EU well as by family gatherings. He has also
agency, the prevalence of coronavirus in argued that the country is now detecting
Spain is now significantly worse than 60-70 per cent of cases, compared with
anywhere else in Europe. Data the fewer than 10 per cent in the spring.
AUGUST 20 2020 Section:World Time: 19/8/2020 - 19:17 User: david.owen Page Name: WORLD3, Part,Page,Edition: LON, 6, 1
Thursday 20 August 2020 ★ FINANCIAL TIMES 7
y
Match not made in heaven The pandemic has reawoken Japan’s urge to meddle in the corporate world
LEO LEWIS, PAGE 21
J&J strikes
Maersk warns
Size matters Target’s record sales surge shows
over stranded
bigger retailers have edge on struggling rivals
$6.5bn deal crew as profits
rise sharply
for biotech
Richard Milne
Nordic and Baltic Correspondent
The largest container shipping line
Momenta
has warned that it faces a “massive
problem” from crew being stranded
on its vessels even as it defied a slump
in global trade to report higher quar-
terly profits.
A mix of cost cuts, higher freight
3 Autoimmune drugs portfolio grows
rates and lower oil prices helped AP
Moller-Maersk report a 25 per cent
3 Biggest buy since Actelion in 2017
increase in second-quarter earnings
before interest, tax, depreciation and
amortisation to $1.7bn from the same
Ortenca Aliaj and platform Auris Health for $3.4bn. period a year ago.
James Fontanella-Khan — New York J&J is threatened with mounting legal The better than expected earnings
Johnson & Johnson has agreed to buy costs. It is embroiled in lawsuits alleging came despite a 10 per cent fall in
biotech group Momenta Pharmaceuti- that its products played a role in the US demand for containers and a 16 per cent
cals for $6.5bn in an all-cash deal that opioid crisis and faces the threat of legal fall in volumes in its shipping business.
will expand the world’s largest health- liabilities over its baby talcum powder, After suspending its full-year guid-
care company’s portfolio of treatments following claims that the product may ance in March, Maersk reinstated it yes-
for autoimmune disorders. cause cancer. In May, J&J said it would terday at a higher level. Previously, it
Momenta shares were up almost stop selling talcum powder in the US had expected ebitda to be about $5.5bn
70 per cent in midday trade in New and Canada. for 2020 before restructuring and inte-
York, nearly matching the premium Big pharmaceutical companies are gration costs, but it now forecasts
offered by J&J, which agreed to pay increasingly focused on rare-disease $6bn-$7bn, higher than last year’s
Momenta shareholders $52.50 a share. treatments, an area that relatively few $5.7bn.
The deal will give J&J’s drugmaking have expanded into even though it Crews have faced problems getting off
division Janssen Pharmaceutica access offers higher-margin products than vessels and returning home because of
to Momenta’s pipeline of products, mass-market drugs. closed borders and a lack of flights, lead-
including nipocalimab, a promising On Monday, French group Sanofi said ing container shipping executives to
treatment for the rare muscular disease it had agreed to buy Principia Biop- sound the alarm on safety.
myasthenia gravis that is also being harma of the US in a $3.4bn deal. Soren Skou, Maersk chief executive,
tested against other autoimmune The coronavirus pandemic has said the group was working hard on
disorders. prompted many healthcare companies tackling the issue by creating hubs for
to shift their focus to finding treatments Target and Walmart were allowed to stay open during lockdown because they stock essential goods crew members in Manila and Mumbai,
— AP Photo/Bill Sikes
Big pharmaceutical and a potential vaccine for Covid-19. where it hired hotels so that they could
The US government recently struck a Alistair Gray — new york growth in stores, outshone robust as its product selection has made it a quarantine before being flown on spe-
companies are
deal with J&J worth more than $1bn to numbers earlier this week from Wal- convenient one-stop shop. cial flights to Denmark and elsewhere,
Big-box US retailer Target has
increasingly focused on secure 100m doses of its experimental mart, which said comparable sales at Target said it had gained $5bn of where they are tested for coronavirus.
reported the biggest quarterly sales
coronavirus vaccine. Clinical human tri- its US business rose 9.3 per cent. market share so far this year. “Every Two-thirds of Maersk’s workers in
rare-disease treatments surge in its 58-year history, sending
als are under way after the company Customer demand had been strong one of our merchandising categories July had been onboard for longer than
one of the clearest signals yet that
reported that its vaccine had positive across categories, Target said, as is gaining share, virtually each and their contract but that was now down to
shifts in consumer behaviour in the
“The acquisition was driven by the results when tested on animals. Americans spending more time at every week,” Mr Cornell said. a third, or about 2,000, Mr Skou said.
pandemic are widening the gap
significant opportunity seen in nipocali- If successful, J&J has promised to home bought goods, from video The company produced revenues of “Initially, people took this in good
between the strongest chains and
mab, along with the scientific capability make the vaccine available during the games to garden supplies. Sales of $23bn in the three months ended spirit and thought they would earn a bit
their weaker rivals.
Janssen is acquiring with the Momenta pandemic on a “not-for-profit” basis. electronics rose more than 70 per August 1, about $4.5bn more than the more by being out a bit longer. As time
team,” J&J said. Covid-19 has also brought attention to Brian Cornell, chief executive, hailed cent, home categories such as kitch- same period last year. Net income went on, we started to see more and
Momenta was founded almost two treatments for autoimmune disorders Target’s performance as “extraordi- enware 30 per cent, and food, bever- rose from $938m to $1.69bn. more mental fatigue. That is not good
decades ago by Ram Sasisekharan, a that are being tested against the illness, nary” as the company yesterday dis- age and other essentials 20 per cent. Digital sales almost tripled in the when you’re on board a ship.”
professor of biological engineering at although the practice of slowing down a closed a 24 per cent year-on-year rise During lockdown, big-box chains quarter, helped by Target’s same-day Mr Skou noted that the improved
Massachusetts Institute of Technology, patient’s immune system while fighting in second quarter like-for-like sales. had a huge advantage over clothing collection services. Mr Cornell said results were Maersk’s eighth straight
and Ganesh Venkataraman Kaundinya. the disease remains contentious. Such an upswing is remarkable for a outlets, department stores and other the company was reaping the rewards quarter of year-on-year improvements
The company initially developed Last month, J&J reported a drop in net retailer the size of Target, which more discretionary retailers that were of a “seemingly counter-intuitive” after it struggled initially following the
generic versions of drugs that had earnings of more than a third as the pan- opened its first outlet in Minnesota in forced to close. decision to make its stores the hub for big demerger of its energy assets from
already been approved by the US regula- demic delayed elective procedures, and 1962 and has since expanded to 1,900 Target and Walmart were allowed online as well as physical retail. its shipping business.
tor. Last year it reported a $290m sales of its medical devices and beauty stores across the US. to stay open because they stock gro- Despite its successes in the quarter, Container demand has rebounded
annual loss and $23.9m in revenue. products declined. The stronger-than-forecast figures ceries, toiletries and other vital items. Target did not provide financial guid- since April, when it fell about 20 per
It is the largest deal struck by J&J since However, the company said the worst pushed Target stock up 11.7 per cent They also offer a wide range of other ance for the full year and Mr Cornell cent, according to Mr Skou. He said he
it acquired Actelion, the European bio- had passed and it remained optimistic in midday trade in New York. products. Even as other retailers have warned of “a lot of uncertainty” over expected the fall in the third quarter to
tech group, for about $30bn in 2017. about drug sales and the Covid-19 Target’s performance, driven by reopened, Target’s format has given it the back-to-school shopping season. be 4-6 per cent, and “sometime in 2021”
Last year the US group bought robotic vaccine. ecommerce but supported by strong an edge over struggling competitors Lex page 22 demand would be back to 2019 levels.
Belarus ripe for private investment if state-run economy opens up
exports more than $7bn of petroleum country. But some western investors
Inside business
products each year to 70 countries, and have already jumped in. In 2017, Euro-
is a critical part of the infrastructure torg, the supermarket chain, became
Europe
that ensures the flow of crude from the first Belarusian company to issue a
Russia to Europe. eurobond, raising $350m in a more than
Henry State-owned Belaruskali accounts for five-times oversubscribed sale. More
almost 20 per cent of the world’s pro- than 90 per cent of the issue was bought
Foy duction of potash, which is used to make by UK, US and European investors. In
fertiliser, and exports $2.75bn of it a 2018, Eurotorg began talks about listing
year. Belaz is one of the world’s largest on the London Stock Exchange.
manufacturers of mining equipment But by far the best advert for investing
and heavy-duty trucks, and the country in Belarus is the High-Tech Park on the
I t is fitting that a defining moment in is the largest exporter of dairy products outskirts of Minsk, 10km round the
the protests against Alexander per capita. city’s outer ring road from the Minsk
Lukashenko, the autocratic presi- But for would-be western investors, Wheel Tractor Plant and the kind of
dent of Belarus, took place at a there are significant competitors: Rus- place where Mr Lukashenko would not
state-owned factory. sia and China. come expecting a warm welcome.
“You and I will sort things out. You Moscow in effect props up Mr Lukash- Established in 2005, the park was
just have to be patient,” he told striking enko’s regime with below-cost energy designed to tap the country’s unusually
workers. “Liar!,” the crowd at the Minsk supplies that are then sold on to western large population of skilled technical
Wheel Tractor Plant yelled in response. buyers at market value. Minsk pockets graduates — a legacy of the Soviet
“Resign!” the difference. Union’s decision to base engineering
Mr Lukashenko’s 26-year regime is Close ties between The High-Tech Park taps and science industries in Belarus — and
the main reason Belarus does not fea- the two countries give them a reason not to leave for job
into the large number of
ture in many investor roadshows. mean that many opportunities in the west.
The strongman leader, who has ruled Russian enter- skilled technical graduates Aimed at a new generation of tech-
his post-Soviet state as if the Soviet prises rely on Bela- savvy, liberal and entrepreneurial Bela-
who are savvy-minded,
Union never collapsed, has resisted rusian partners to rusians and offering tax incentives and
western liberalisation efforts: state-run build, buy or proc- liberal and entrepreneurial other benefits, it houses 700 companies,
enterprises such as the Minsk tractor ess their products. more than three times the number in
plant account for 70 per cent of the Russian investors are therefore likely 2017. About 50 per cent of the software
$60bn economy. to position themselves at the front of the produced there is exported to Europe,
The decision for those big state-run queue if a new government seeks capital and 45 per cent to North America.
businesses to rebel was a turning point for industrial assets. Local tech companies include Viber, a
in a wave of popular unrest that began At the same time, China has become messaging app, and Epam, an out-
with protests over Mr Lukashenko’s dis- one of the largest investors in Belarus in sourcer that is listed on the New York
puted victory in the August 9 presiden- the past decade, valuing its position as a Stock Exchange. The IT sector contrib-
tial election. But if he is ousted, the bridge between Russia and Europe and a uted 5.5 per cent of gross domestic prod-
future of many of them will be thrown staging post in its “Belt and Road” infra- uct in 2018 and is set to reach 10 per cent
into doubt. structure chain across Europe and Asia. by 2023. Many hope the IT industry will
While many of the businesses are out- Chinese technology groups such as become the driving economic force if
dated, inefficient and would probably Huawei and ZTE have invested in the Mr Lukashenko heeds the advice of the
require more cash to modernise than country and about $8bn of loans tied to tractor workers and leaves the stage.
they would pay out in returns, others purchases of Chinese equipment have
could be ripe for private investment if a been provided by Beijing to Belarusian [email protected]
different administration took charge. enterprises. Geely, the Chinese car- Markets page 11
Belneftekhim, the state oil refiner, maker, has an assembly plant in the Lex page 22
AUGUST 20 2020 Section:Companies Time: 19/8/2020 - 19:37 User: karen.crawcour Page Name: COMP&MKTS1, Part,Page,Edition: LON, 7, 1
8 ★ FINANCIAL TIMES Thursday 20 August 2020
COMPANIES & MARKETS
Transport Technology
Deutsche Bahn under fire over load data Pinduoduo
clashes with
Tesla on
Booking sites hit at refusal delays, that are available on DB’s own opposition Free Democrats who sits on complicating efforts to prevent over- ada. While operators such as France’s
to share information on app. Founder Naren Shaam said. “I the German parliament’s committee for crowding on some routes. SNCF offer the company detailed infor- discounting
never expected a monopoly, or indeed transport, criticised the company’s “Our customers tell us that access to mation, Deutsche Bahn does not.
level of railway crowding any train company, to stoop to this refusal to share information on crowd- disruption, delay and cancellation “Fundamentally, we don’t have access
level . . . You don’t commercialise ing and punctuality. information, all powered by real-time to basic information like . . . platforms,
public safety.” “DB is 100 per cent owned by the data, helps them have a better, safer delays, all the stuff that makes the jour-
Joe Miller — Frankfurt
Guy Chazan — Berlin Deutsche Bahn, which is in line to federal government, and its economic journey,” Trainline said. ney seamless,” Mr Shaam said. Christian Shepherd, Ryan McMorrow
receive a multibillion-euro support survival is currently being secured with The lack of access to real-time data in Last year, Germany’s Federal Cartel and Nian Liu — Beijing
Travel booking sites have criticised package from the German government, billions in taxpayer support,” he said. Germany had prevented Trainline roll- Office said it would investigate whether China’s Pinduoduo has clashed with
Europe’s largest rail operator, state- said that the health of its passengers was “In view of the current situation and for ing out its Crowd Alerts feature in the DB’s restrictions on data sharing were Tesla after it sold the US group’s electric
owned Deutsche Bahn, for refusing to a “top priority” and when there were the sake of health protection, the provi- country, it said. The scheme, currently anti-competitive. vehicles at a hefty discount, highlight-
share data predicting how crowded its capacity constraints on a particular line, sion of data is overdue and more than available in the UK, allows passengers to Yesterday, Omio, which offers book- ing the ecommerce platform’s use of
trains are during the pandemic. “customers are no longer able to buy justified.” share feedback on how busy individual ing services for trains, buses, flights, big subsidies.
Omio, a Berlin-based start-up, said tickets for this train either from DB Two other booking sites, Berlin’s trains are to support social distancing. ferries, car rentals and car sharing,
Deutsche Bahn would not allow custom- directly, or from DB’s online partners fromAtoB and UK-based Trainline, con- Omio, which was founded in 2013, announced that it had secured a further Pinduoduo, the most valuable company
ers using its site to view load factors and like Omio”. firmed that they had been denied access works with more than 800 transport $100m from investors including Singa- never to have turned an operating
real-time data, including on train But Torsten Herbst, a member of the to some Deutsche Bahn information, operators in Europe, the US and Can- pore’s Temasek and Goldman Sachs. profit, last month hosted a group-
buying event in which China shoppers
could buy a Tesla Model 3 for signifi-
cantly below its Rmb291,800 ($42,200)
Technology. Trade tensions price tag.
But Tesla originally said it would not
deliver the cars, pointing to a company
China pulls its punches in face of Trump onslaught
policy that bans the resale of its vehicles.
Tesla, which recently became the most
valuable carmaker, only sells its vehi-
cles direct to buyers via its website,
bypassing dealers.
Pinduoduo is known for offering cus-
Measured response reflects
tomers generous subsidies, which it
value Beijing attaches to records as sales and marketing fees. In
the first three months of this year, these
sources of innovation fees were greater than its revenues.
Analysts question if its business model
can become sustainable.
Yuan Yang, Nian Liu and
Despite that, the group’s US-listed
Christian Shepherd — Beijing
shares have risen 138 per cent this
The Trump administration’s targeting year to give Pinduoduo a value of
of China’s biggest technology groups has roughly $110bn.
prompted concerns of forceful retalia- But analysts said the sales of the dis-
tion against American businesses. counted Tesla cars had taken its use of
President Donald Trump this month subsidy-based marketing to a new level.
signed executive orders that could hit Pinduoduo sold five Model 3s at about a
the operations of ByteDance, China’s 14 per cent discount, with the company
most valuable start-up, and Tencent, its and one of its online merchants making
second-largest tech company. On Mon- up the difference to the official price,
day, Washington moved to cut off Hua- according to Chinese media reports.
wei’s access to its global suppliers, which
some say could prove lethal for the Chi- ‘They’ve been doing a lot
nese telecoms group.
to let people know they
But despite mounting political pres-
sure to unveil commensurate restric- have high-value stuff’
tions on US businesses in China, Beijing
has historically been reluctant to retali- Shawn Yang, Blue Lotus
ate. Analysts think officials may con-
tinue to pull their punches because they Shawn Yang, managing director at
are reluctant to upset the economic ben- Blue Lotus Capital Advisors, said
efits and innovation US companies that the Tesla stunt suggested that Pin-
bring to China. duoduo was trying to shake off its repu-
“One of the key ways for Beijing to tation as a platform for cheap goods.
fight [measures by the US] is to keep Last year, its average order was worth
foreign companies and investors in just Rmb51.
China,” said Sean Ding, analyst at “It doesn’t want to stay that way, and
research firm Plenum. they’ve been doing a lot to let people
Investors have been fretting over know they have high-value stuff on their
China targeting foreign businesses since ground rather than engage in tit-for-tat Apple is among damage, especially during a time when platform like iPhones or Teslas to try to
March 2019, when Beijing announced it measures. many American the government wants the car industry attract high-value users.”
would draw up a “non-reliable entity “Given the current practices of the US, companies with to be a driver of China’s economic recov- Another Hong Kong-based equity
list” of companies that had harmed its the most beneficial approach for China a significant ery from coronavirus, Mr Le said. analyst said: “It’s all about marketing.
interests. But neither the list nor any is not to simply retaliate, but rather to presence in Executives point out that market Last year they sold Wuling [cheap mini-
penalty has materialised. create the image that China is the most China, along access for foreign companies is often vans], this year they sold Cadillac and
China is a huge market for many reliable supplier and customer and will with Starbucks granted only if China believes they will now they are selling Tesla. They want to
American companies, ranging from not arbitrarily break off supply or con- and Nike help to develop local industries, such as get rid of their low-end image.”
tech groups to carmakers. About two- tracts,” he said. Qila Shen/Bloomberg investment banking, electric cars and Pinduoduo was increasing subsidies
thirds of the revenues of Qualcomm, the However, some believe Beijing has software development. That suggests to lift its growth but doing so only added
US semiconductor maker, come from limited room for manoeuvre. “China’s there is little incentive to kick them out to its losses, said one industry insider.
China, while US brands from Nike to ability to retaliate in high tech is very once they have been invited in. “It’s an endless loop,” he said.
Starbucks rely on Chinese consumers limited” and in many industries it is still “The Chinese government doesn’t Sales on Pinduoduo have on occasion
for over a tenth of their sales. keen to attract foreign investment, said care where you come from so long as displeased western brands, including
But US companies in China have Shi Yinhong, an international relations you help China to grow,” said Joerg Apple, whose iPhones it sells with hun-
largely been immune to government- scholar at Renmin university in Beijing. Wuttke, president of the EU Chamber of dreds of dollars knocked off the retail
imposed restrictions or investigations. “I can’t think of any tit-for-tat retalia- Commerce in China. price despite not being an authorised
Apple, a big competitor of Huawei in tory measures.” “China still faces a huge gap when it reseller. Apple declined to comment.
the smartphone market, has continued Analysts also point to the fact that US comes to certain parts of the supply Tesla’s decision not to honour the Pin-
to grow its revenues in the country companies are often closely integrated chain. They like the fact that the US duoduo sales yielded criticism of the
despite a recent brush with regulators with Chinese counterparts in the world’s investment is high-tech and they’re carmaker, for which China is an impor-
over licences for games on its App Store. second-biggest economy, often through helping to build up supply chains here,” tant market. The group sold 45,721 vehi-
Its China iPhone sales rose a third in the joint ventures, risking collateral dam- said Mr Wuttke. cles in China in the first half of 2020,
second quarter, according to Counter- age if Beijing targets US companies. Beijing may also be cautious about accounting for about a quarter of its
point research. General Motors, for example, sells imposing measures from which it will total deliveries.
The latest Huawei sanctions are a more cars in China than it does in the later be difficult to back down. Three Qiu Baochang, an expert at the
clear provocation, analysts say. Mei US. But its joint ventures with Chinese years ago Chinese consumers boycotted official China Consumers’ Association,
Xinyu, a researcher affiliated with car companies mean that the domestic South Korean goods and companies called Tesla’s actions “improper”. They
China’s commerce ministry, points out industry would also be likely to suffer if over a proposed missile defence system, had “hurt consumers’ legitimate rights
that the telecoms group, which is central authorities targeted GM. “If they go amid a wave of nationalist sentiment. and interests. Through giving a sizeable
to Beijing’s ambitions in 5G mobile tech- after General Motors, it would likely “The Chinese don’t want to escalate, subsidy, Pinduoduo may have earned
nology, is far more important strategi- hurt [its Chinese partner] SAIC Motor they want to keep the door open. It’s massive traffic. There is nothing wrong
cally than ByteDance and Tencent. too,” said Tu Le, founder of consultancy very, very hard to undo sanctions with that.”
Nonetheless, Mr Mei said he believed Sino Auto Insights. because you have to explain it politically Tesla did not immediately respond to
that officials may try to take the high There could be too much collateral to a Chinese base,” added Mr Wuttke. a request for comment.
Financials Food & beverage
‘Wolf of Wall Street’ to coach on RagingBull PepsiCo hires outgoing WTO chief Azevêdo
Richard Henderson — New York RagingBull said yesterday. The com- website. Instead, a “team of experts” Alistair Gray — NEW YORK US and China, and a sharp drop in global The group has benefited from people
pany added that he would not be giving with no professional investment experi- commerce during the pandemic. eating more snacks between meals at
The “Wolf of Wall Street” has signed up The outgoing head of the World Trade
advice on specific stocks, companies or ence presents online training for annual His appointment as chief corporate home during lockdown, although
as a coach on RagingBull, a US stock- Organization is joining PepsiCo with a
investment strategies. subscriptions of up to $2,000, according affairs officer, a new role, is the latest demand for drinks in bars and restau-
trading training platform that has brief to help the food and drinks com-
Mr Belfort’s crimes were chronicled in to the company. example of multinationals hiring politi- rants has been hit.
drawn fire for its high-pressure sales pany deliver on a series of targets it has
a 2013 Martin Scorsese film starring Tutors include Jeff Bishop, who the cians and officials with geopolitical The sector is also in the spotlight over
tactics. set from increasing workforce diversity
Leonardo DiCaprio. He launched a sales company describes as “a lifetime mem- insights and contact books to match. the sugar and salt content of some of its
to reducing plastic waste.
Jordan Belfort earned the nickname by coaching business after leaving prison ber of Mensa, the high IQ society”, and This week, JPMorgan Chase said Sajid products and concerns about its envi-
offloading worthless penny stocks to in 2005. The announcement of his Jason Bond, a former physical education Roberto Azevêdo, the WTO’s sixth Javid, former UK chancellor, was joining ronmental impact.
retail investors at Stratton Oakmont, recruitment comes a day after the US teacher who claimed in a promotional director-general, will become a full- the bank’s European advisory council. PepsiCo has a set a range of environ-
the brokerage he ran in the 1990s, which stock market hit a new high, capping a video to be “well-known as the top stock time executive at the company behind Mr Azevêdo said he had chosen Pep- mental, social and corporate govern-
was described as “a quintessential rapid recovery from March lows that trading trainer in the entire world”. Pepsi, Doritos crisps and Tropicana siCo, where he will manage public pol- ance targets. These range from cutting
‘boiler room’” by the Securities and has drawn record numbers of everyday The pair launched the Lee, New juice from next month. icy, government affairs and communi- new plastic content for its beverages by
Exchange Commission. He was sent to investors, including many novices. Hampshire-based company in 2011. “The company is committed to cations, over offers from consultancies, 35 per cent by 2025 to putting more than
prison and barred from association with “The market has been flooded with RagingBull has faced criticism over impactful changes and I’m really con- law firms and other companies. 250 black employees into managerial
any broker, dealer, investment com- new accounts and traders and a lot of dozens of daily promotional emails sent vinced I can help accelerate those He has known Ramon Laguarta, the positions by the same year.
pany or investment adviser. them don’t know what they’re doing,” to customers, delays in providing changes,” he told the Financial Times. PepsiCo chief executive who replaced “I was speaking to Ramon just yester-
Now, he will “share his favourite Mr Belfort said. refunds and for asking customers to sign The former Brazilian diplomat who Indra Nooyi almost two years ago, for day, and he was saying these targets are
trading sectors” with retail investors RagingBull is not overseen by US non-disclosure agreements before has led the WTO since 2013 said in May years and had been neighbours in not for show, they’re for real,” Mr
and teach them how to “learn from your securities regulators and is “neither receiving their money back. It has been he was leaving one year early. The WTO Geneva. He joins PepsiCo at a time of Azevêdo said. “If we promise some-
mistakes” and “take advantage of licensed nor qualified to provide invest- the focus of 148 complaints to the US has had to contend with rising world disruption in the sector that has intensi- thing, we need to make sure that we
opportunities” in a series of videos, ment advice”, the company states on its Better Business Bureau. trade tensions, particularly between the fied during the pandemic. deliver.”
AUGUST 20 2020 Section:Companies Time: 19/8/2020 - 18:14 User: cathy.pryor Page Name: CONEWS1, Part,Page,Edition: LON, 8, 1
Thursday 20 August 2020 ★ FINANCIAL TIMES 9
COMPANIES & MARKETS
Oracle boss joins race against clock for TikTok
White House ties loom large in emergence of Ellison as potential bidder for Chinese-owned video app’s US operations
Richard Waters — San Francisco hugely valuable hit consumer internet
Kiran Stacey — Washington business. And with potential buyers
When Oracle turned to Wall Street this such as Google and Facebook on the
year to raise $20bn in a bond sale, it sidelines as politicians try to limit their
immediately prompted speculation that power, Oracle is one of the few compa-
Larry Ellison, the company’s co- nies that could seize the moment.
founder and chairman, might be pre- The Oracle chairman has also main-
paring a big acquisition. tained close ties to the Trump adminis-
But a purchase of the US business of tration that could pay off as the presi-
TikTok — even if it had been on the mar- dent looks for a quick resolution. “Polit-
ket at the time — would have been at the ically, they are one of the better con-
bottom of almost every expert’s list. nected [companies] in Washington
That has not stopped Mr Ellison right now — they are one of the few that
emerging this week as a potential bidder could pull something like this off,” said
— in league with a group of venture capi- Mr Elman.
tal investors — for parts of the Chinese- Both Mr Ellison, who now serves as
owned video app sensation. Among the Oracle’s technology strategist, and Safra
most intriguing aspects of the surprise Catz, its chief executive, have been close
intervention: it could put Mr Ellison in a to the Trump White House. Ms Catz was
race against the clock with longtime a member of the president’s transition
rival Microsoft to salvage TikTok’s US team in 2016, while Mr Ellison recently
operations, which are facing forced clo- hosted a fundraising dinner for the pres-
sure by the White House. ident at one of his homes in California —
“I still think it’s possible to beat Micro- though he said that he did not attend
soft, believe it or not, for us to be a more himself.
important company than Microsoft,” The closeness appears to have paid
Mr Ellison told the San Francisco off, at least in terms of access. In April
Chronicle in 2014. Since then his neme- 2018, Ms Catz attended a private dinner
sis in the software business has soared with Mr Trump at which she was
on the back of the booming cloud com-
puting market, while Oracle’s fortunes With potential buyers on
have sagged. Its revenue last year was
the sidelines, Oracle is one
only 5 per cent higher than it was eight
years before, leaving Wall Street anx- of the few companies that
ious about whether Mr Ellison, one of
could seize the moment
the winners from the client-server era of
computing that began in the 1990s, can
be a leader in the cloud.
According to some analysts, that reported to have criticised the bidding
TikTok tops 2bn downloads US use surges in pandemic
would make any offer for TikTok an process for the multibillion-dollar Jedi
Cumulative global download estimates* % change in average US daily active users**, 2020 v 2019
opportunistic move prompted by Mr cloud computing contract for the Penta-
Ellison’s personal whims and political 2bn downloads TikTok Facebook WhatsApp Instagram Twitter gon — a process Oracle appealed in the
considerations rather than by Oracle’s 125 125 courts. A year later, as the process
most pressing strategic needs. reached its final stages, Mr Trump inter-
100 100
Oracle operates in the guts of large- vened, saying that “great companies”
scale IT systems, selling the databases 75 75 — including Oracle — had complained
and business applications that are core 1bn downloads about it.
50 50
to the way big organisations run. But it Oracle has also complained bitterly
Aug 2018 Musical.ly and TikTok merge
25 25 about a case being brought by the US
Ownership of a popular Department of Labor, accusing the com-
0
pany of sex and race discrimination in
social media app would 0
its pay policies. Last month the govern-
-25 -25
help its cause by bringing a ment lawyer in charge of bringing that
2014 15 16 17 18 19 20 Jan Jun Jan Jun Jan Jun Jan Jun Jan Jun
case was told she was being reassigned —
large captive user base * Includes Douyin and Musical.ly. Downloads for App Store and Google Play only, does not include data from ** Android apps
other third-party Android stores a decision she is now appealing.
Sources: SensorTower; SimilarWeb Oracle would not comment on
whether it had made direct representa-
has lost ground to Amazon, Microsoft plete lack of experience in running con- tion a gift to TikTok’s rivals, he said. try’s most active acquirer, buying up Actor Marie tions about the department’s lawyer,
and Google as corporate computing has sumer businesses, some analysts “Their DNA is enterprise. The only one rivals and folding their products into his Zaccagnino and but it said: “Anyone who followed the
moved to the cloud. warned. When a similar pursuit of who hopes Oracle gets this is Facebook.” own, in the process slicing costs. But musician Sean trial observed first hand that DoL’s case
Ownership of a popular social media consumer data led Marc Benioff, Kevin Walkush at Jensen Investment over the past decade, Oracle has had Sheridan dance lacked all evidence and merit.”
app would help its cause by bringing a head of Salesforce and a former Management, an Oracle shareholder, only one big deal — the $9.3bn purchase and record Meanwhile, Oracle is also one of only
large captive user base for its cloud Ellison protégé, to try to buy said that the TikTok and Oracle cus- of NetSuite, the cloud software com- themselves for a three groups to have been granted more
infrastructure, said Daniel Elman, an Twitter four years ago, it tomer bases were “diametrically pany that Mr Ellison himself had helped TikTok video. than one seat on the president’s task
analyst at Nucleus brought a storm of protest opposed”, while any cloud computing found. Instead, it has poured more than Left, Larry force to reopen the economy following
Research. Oracle could also from Salesforce share- business that came from a deal would be $110bn into buying back its own shares. Ellison the coronavirus lockdown — Mr Ellison
use TikTok’s “user behav- holders, forcing him to “commodity”. Other than being an “It would seem out of character,” said Angela Weiss / AFP and Ms Catz have been granted places.
iour data to supplement drop the idea. American company with the resources Alex Zukin, an analyst at RBC Capital The closeness could put Oracle in a
its marketing services”, “I just don’t think this to pull off an acquisition, there was no Markets. Mr Ellison is mainly driven by strong position in the pursuit of TikTok,
offering its big corporate custom- deal makes sense,” said logic to Oracle getting involved, he said. bargain-basement prices and the while a deal would also further
ers valuable information about mil- Brent Thill, an analyst at A bid for TikTok would also go against chance to consolidate markets, he said. strengthen Mr Ellison’s ties to the White
lions of consumers, he said. Jefferies. Oracle’s lack of the grain of Mr Ellison’s typical acquisi- But if the strategic logic is lacking, the House. Whether this would be enough
But these side benefits from a deal consumer experience tions. In the first decade of the millen- forced sale of the TikTok operations has to satisfy Wall Street, however, is
would not make up for Oracle’s com- would make an acquisi- nium, he became the software indus- created a rare opportunity to pick up a another matter.
Travel & leisure. Motorsport Travel & leisure
Manchester City in talks to
F1 teams reach deal with owner over revenues
buy second-tier French club
pot derived from television rights, pro- more balanced revenue distribution changes to the agreement. The contin-
Chairman hopes agreement
moter fees and advertising revenues, clearly make it a healthier business ued support of all 10 teams will allow Murad Ahmed — Sports Editor
can reinvigorate the global more fairly among the teams. model.” Liberty Media to focus on restoring F1 to
Manchester City’s parent company is in
The previous arrangements had F1 secured agreement from all 10 health after the pandemic. Mr Carey is
late-stage talks to buy French football
competition and lure investors favoured larger teams, such as Ferrari, teams despite a late clash with Mer- targeting a full 22-race season in 2021.
side ESTAC Troyes in a deal that would
Mercedes and Red Bull, giving them a cedes, which is leading this year’s cham- “This year threw us a curveball —
extend its strategy of taking over clubs
significant financial advantage over pionship in the hunt for a record sev- threw the world a curveball — with the
Samuel Agini smaller competitors such as McLaren enth consecutive title. Toto Wolff, the virus,” he said. “We feel we’re making around the world.
Formula One has renegotiated the cru- and Williams through higher payments. real headway.” CFG executives have also held talks with
cial deal that commits racing teams to Ferrari, for example, receives a bonus He is hoping that F1 will be able to several other French sides in recent
the global series and sets out how reve- because it is the only team that has Chase Carey: hold at least 15 races this season in order months, including Nancy, also in the
‘You may be an
nues are split, after months of delays raced every season in F1 since the com- to meet the terms of its broadcasting second division, but consider Troyes the
underdog but
because of the coronavirus pandemic. petition’s inception in 1950. contracts. However, widespread bans prime target in the country, according to
you want an
It is the first time the Concorde Agree- Although Mr Carey declined to give opportunity on mass gatherings have hit the reve- people familiar with the negotiations.
ment, which governs how F1 shares rev- details on the sums involved and how F1 to win’ nues F1 makes from ticket sales and While the parties soon hope to con-
enues with racing teams, has been rene- would share revenues with teams, he promoters who pay for the right to host clude a transaction with an acquisition Takeover target: Troyes, in blue, in
gotiated since Liberty Media, the US said the new Concorde Agreement could Mercedes motorsport chief, had com- events. price in the “single-digit millions” of action against Sporting Charleroi
group controlled by billionaire John make teams more attractive to inves- plained that the team stood to be “the F1 sunk to an operating loss of $122m Euros, talks are continuing and could
Malone, acquired the racing competi- tors. biggest victim” of the revised revenue on revenues of $24m in the second quar- yet come to nothing, said a person with gain experience of European leagues
tion in an $8bn deal in 2017. “It’s no fun to be in a sport and feel you split. ter versus an operating profit of $26m knowledge of the negotiations. where the standard is considered higher
Chase Carey, chairman and chief can’t be competitive,” he said. “You may The existing deal expires at the end of on revenues of $620m in the corre- It would be the latest football club than elsewhere in the world.
executive of F1, told the Financial Times be an underdog but you want an oppor- this year and Mr Carey said he would sponding period a year earlier, it said purchase for Sheikh Mansour bin Zayed Troyes narrowly missed out on pro-
on Wednesday that the deal, together tunity to win . . . the cost cap and a like to see less “drama” around future this month. In 2019, F1 revenues rose by Al Nahyan, the billionaire member of motion in the past two seasons, having
with plans to introduce a $145m budget 11 per cent to $2.0bn. Abu Dhabi’s ruling family who bought been relegated from Ligue 1, France’s
cap on teams from next season, would Teams have also struggled without Manchester City in 2008. top tier, in 2018.
set the long-term foundation for races. While F1 was able to protect itself He has spent hundreds of millions of CFG is also evaluating teams in
growth. by cutting its costs, the lack of races pounds on top players and turned Man- Europe, Africa and Asia. While spend-
“We do want to make it a sport more meant that second-quarter team pay- chester City into a force capable of win- ing is fuelled by its rich owner, new
about how well you spend your money, ments dropped from $335m to nil. ning the biggest prizes. In 2013, he set up funding has been provided by US pri-
not how much you spend,” said Mr Although F1 has become more digit- CFG to buy or take minority stakes in vate equity group Silver Lake, which last
Carey, who has run F1 since replacing ally savvy since the takeover, focusing clubs around the world. year paid $500m for a 10 per cent stake
Bernie Ecclestone, the billionaire who on attracting a younger audience Some teams, such as New York City in CFG, valuing the group at $4.8bn.
transformed the sport into a global phe- through social media channels that FC and Mumbai City, have been bought Last month City overturned a two-
nomenon over four decades. were neglected under Mr Ecclestone, with the aim of breaking into lucrative season ban from the Champions League
Securing consensus among the 10 Liberty Media has struggled to expand markets and promoting City’s brand. competition for alleged breaches of
teams was complicated by the pan- the racing series into the US and But the strategy is also designed to spot Financial Fair Play rules. This allows it
demic, which put the Concorde Agree- acknowledged that attracting new spon- promising players and bring them into to take part in Europe’s top competition
ment on the backburner, while Liberty sorships has been harder than expected. the CFG network. where clubs have the chance to share in
Media injected $1.4bn into the sport “I think we’re doing the things to grow A deal with Troyes would follow the more than €2bn of prize money.
after revenues dried up as the season the sport,” said Mr Carey. “We’re cer- strategy of investing in other small sides The club was, however, knocked out
was delayed for four months. tainly not declaring victory, we’ve got a — such as Spain’s Girona and Belgium’s of the competition by France’s Olym-
The new deal, which will run from lot to do . . . but we’re on the right path.” Lommel SK — giving wider opportuni- pique Lyonnais last week and has never
2021 until 2025, will distribute a $1bn Ferrari’s team at the Spanish F1 Grand Prix Additional reporting by Murad Ahmed ties to young stars and ensuring players won the tournament.
— Emilio Morenatti/Pool/epa-EFE/Shutterstock
AUGUST 20 2020 Section:Companies Time: 19/8/2020 - 18:14 User: cathy.pryor Page Name: CONEWS2, Part,Page,Edition: LON, 9, 1
10 ★ FINANCIAL TIMES Thursday 20 August 2020
uk COMPANIES
Banks
UK financial
scams surge
against bank
customers
Morrison uses Amazon to outflank Asda in battle of the British aisles
Matthew Vincent
Financial frauds against UK bank cus-
sales did double, but Morrison’s digital company’s pension fund trustees give it Yesterday’s 5 per cent bump off the specialist DeLaval was well above what
tomers increased by two-thirds in the
Kate business is still accelerating faster. The the nod. back of a new Nato contract will hardly analysts reckoned the cyclical unit was
first half of this year, according to the
Bradford-based group has been That cannot be a given, though. An garner it headlines. worth. And its acquisition of 3M’s
latest data — suggesting that criminals
Burgess altogether quicker witted and more exit may not be easy either. There is no Despite starting out making tyres, ballistic protection business
have seized upon coronavirus worries
nimble during the crisis. big sign above the door. Asda is conveyor belts and milking machine announced last year is turning out
to steal more from savers.
Asda, owned by Walmart since 1999, hemmed in by competition and a tubes back in 1885, Avon has steadily nicely, with new body armour
has struggled to find its mojo since the trustbuster inimical to consolidation. ditched its rubber roots. It struck a deal contracts from the DoD. New figures published yesterday by Bar-
UK’s competition authority scuppered An initial public offer is possible. to sell the last of those businesses — There is no masking the fact that clays Bank showed there was a 66 per
Poor old Asda. The staff of all grocers its plan to merge with Sainsbury last But for all Morrison’s sales growth, its milk — last month. investors pay a high price for a defence cent increase in reported scams in the
are modern legends in the pandemic year. Walmart has put the UK shares are not up much year on year. Avon has recast itself as a niche group — 30 times forward earnings first six months of 2020, which included
era. Asda’s sales growth has been less subsidiary back on the block. Private Sainsbury’s shares are flat. And Tesco’s protection provider to the military and while Chemring and Ultra Electronics the pandemic lockdown, compared
than legendary, though. Unlike its equity groups are circling. A £7bn price are no higher than where they were in police, fashioning increasingly fancy trade on 18 times. Compare that with with the last six months of 2019. Fraud
rivals. has been mooted on the basis that 2015 when it made a record £6.4bn respirators for the US Department of peers in the industrial sector though volumes also rose by 61 per cent
Over the quarter to June, same-store Walmart would keep a minority stake. loss. Investors should deem dividend- Defense and other fighting forces. It and the valuation is not quite so between May and July this year, as cer-
sales of the UK’s third largest But Asda would be a mouthful for a paying grocers as heroic as shelf- has churned out organic growth along stretched — Spirax-Sarco and Halma, tain lockdown measures were eased and
supermarket rose just under 4 per single private equity firm to swallow, stackers are to customers. They do not. with adjusted earnings before two other Stakhanovites, trade on 42 customers became more willing to
cent, excluding fuel, it said this week. even those awash with cash. The price interest taxes, depreciation and times earnings, says S&P Global, spend.
Stealth Stakhanovite
That is half the growth of J Sainsbury in tag — about 10 times earnings in the amortisation margins of 20 per cent thanks to years of predictable growth. The most recent increases in fraud
the same period and even further year to December 2018 — is Mask maker makes money during plus. Analysts’ concerns over its Avon’s boss Paul McDonald, who have been driven by a spike in reported
behind Wm Morrison, which conveniently close to the value put on coronavirus crisis; shares soar 70 per dependence on a single product and a spent a decade heading up the milk investment scams, in which criminals
announced yesterday that Amazon the group during the proposed tie-up cent so far this year. Avon Rubber has single customer — the M50 and the business before taking the top job in target customers looking to earn a bet-
Prime members on the doorstep of with Sainsbury and a little above the been one of the top five performing DoD — have abated as it has upscaled 2017, could still make mis-steps. Flush ter return on their cash.
Asda’s Leeds HQ can now buy all their £6.7bn price that Walmart paid two stocks in the FTSE 250 since January. its offering and broadened its customer with cash, there is the risk he does one According to the bank, evidence of
groceries from Morrison and expect decades ago. It is also not far off the But Avon is no personal protective base. Concerns over the use of M&A deal too far. No sign of that yet, cryptocurrency fraud had been emerg-
same-day delivery. There are plans for value of Asda’s freehold estate. equipment mask maker — instead, it is chemical weapons in terror attacks though. And he is clearly prepared to ing during lockdown, with scammers
the tie-up to be extended. Buyout firms are no doubt salivating the newest entry into Lombard’s have made militaries more willing to kill his darlings. Investors should hang offering bogus investments in legitimate
Non-food sales suffered particularly. at the prospect of gearing up Asda’s Stealth Stakhanovite index of shell out. on to this one. cryptocurrencies or in currencies that
Perhaps shoppers preferred not to balance sheet, which had nearly £9bn companies that crank out under-the- Management has proved itself adept did not exist. But it was only between
drive to Asda’s big out-of-town boxes, of tangible assets in 2018 and threw off radar share price growth. The shares at M&A too. At £180m, the price for [email protected] June and July that reported investment
even after lockdown ended. Online close to £800m in cash, assuming the have almost tripled over 14 months. the milking machine sale to Swedish Avon Rubber: [email protected] scams leapt by 49 per cent — to the high-
est level Barclays had ever received —
because of the delay in victims realising
they had been conned. In some cases,
Travel & leisure customers were waiting for confirma-
tion of an investment that never came,
Marriott hotels
and so did not report the crime until
some time after it took place.
Earlier in the lockdown period, the
biggest rise in fraud reports to the bank
group faces data had involved impersonation scams, in
‘Fraudsters have
undoubtedly taken
breach lawsuit
advantage of the
nation’s uncertainty’
which con artists pretend to be tax offi-
cials, utility providers or bank staff, in
Collective action centres class action-style lawsuit. All consum- order to seek payments and personal
ers with the same interests are automat- information. In June, reports of these
on personal details of
ically included in the claimant class scams to Barclays were almost double
former Starwood guests unless they opt out. those in the previous month.
Mr Bryant, represented by Hausfeld, Jim Winters, head of fraud at Bar-
the law firm, is claiming damages for clays, said: “Fraudsters have undoubt-
Jane Croft
loss of control of personal data using the edly taken advantage of the nation’s
Marriott International, the hotels 1998 Data Protection Act and the EU’s uncertainty during the pandemic
group, is facing a lawsuit in London’s General Data Protection Regulation. . . . The immediacy of our lives, even
High Court for its alleged failure to pro- He had sought a collective lawsuit during lockdown, has allowed
tect the personal data of millions of because he wanted to serve notice on scammers to harness the constantly
former guests in one of the largest data data owners that they must hold data changing news agenda to target their
breaches in corporate history. responsibly, he said. victims, which is why we all need to
Martin Bryant, a technology journal- “Personal data is increasingly critical remain vigilant.”
ist, has filed a collective action lawsuit as we live more of our lives online but, as Barclays’ findings tally with other
on behalf of victims in England and consumers, we don’t always realise the reports of increased fraud this year. Last
Wales whose personal data were risks we are exposed to when our data is month, the Investment Association
exposed after making bookings through compromised through no fault of our warned of attempts to sell fake invest-
the Starwood Hotels group, which is own,” Mr Bryant said. ment products through bogus price
now part of Marriott International. Marriott, which faces suits filed by comparison sites, often promoted by
consumers in the US and Canada relat- Google and Facebook links. In June, HM
‘We don’t always realise ing to the incident, declined to com- Revenue & Customs said reports of
ment on pending litigation. scam tax emails seeking personal infor-
the risks we are exposed
The Information Commissioner’s mation had risen 74 per cent since Janu-
to when our data is Office, the data protection regulator, ary.
announced in July last year a statement Next round Greene King, the UK pub group, has to solve this because otherwise we Commenting on the latest increases,
compromised’
of its intent to fine Marriott £99m over urged the government to extend its will lose a lot of businesses in our consumer campaign group Which?
the data breach following an investiga- discount eating out scheme in city sector.” demanded that innocent victims of
Greene King
In 2018, Marriott revealed that hack- tion. A final decision is expected on the centres and cut rail costs to encourage Mr Mackenzie said that one way fraud have their money reimbursed
ers had gained unauthorised access to fine next month. consumers to return to urban areas to encourage consumers back would automatically — rather than under a
hundreds of millions of guest records Collective actions are becoming more seeks discount where trading remains at all-time lows. be to continue the government’s “eat voluntary code. “Unscrupulous fraud-
worldwide in a security breach of the commonplace in the English courts. The company, which was bought by out to help out” scheme, which sters have inevitably turned their atten-
Starwood guest reservation database Last year, a groundbreaking Court of Hong Kong tycoon Li Ka-shing last offers customers a discount of 50 tion to the coronavirus outbreak as it
extension
between July 2014 and September 2018. Appeal ruling allowed a lawsuit brought year, said yesterday that sales in its per cent on food and soft drinks presents a new way to exploit people for
The data included names, home and by Richard Lloyd, the consumer cham- West End and City of London pubs backed by the Treasury on Mondays financial gain,” said its head of money,
email addresses, telephone numbers pion, to go ahead against Google, the were down as much as 80 per cent through Wednesdays during August, Gareth Shaw. “This code should be
and passport and credit card details. tech company. compared with last year. Two-fifths of for longer in inner cities. made mandatory for all banks so that
Brands affected included W Hotels, Mr Lloyd is the representative claim- its pubs in the capital remained closed The closure of pubs at the end of strong standards on reimbursement are
Sheraton Hotels & Resorts and Le Meri- ant for more than 4m Apple iPhone as workers had not returned to offices March was a catalyst in pushing the introduced for all those who lose money
dien Hotels & Resorts. users and alleges that Google has taken and tourists stayed away. 221-year-old pub operator to a to this type of crime.”
Up to 7m former guests in England individuals’ browser-generated infor- “[The sites] will just not be viable,” £273m pre-tax loss in the year to the Barclays is now warning savers to
and Wales are thought to have been mation without their consent in contra- said Nick Mackenzie, Greene King’s end of April, down from a £173m beware of scams related to staycation
affected by the data breach and Mr Bry- vention of the 1998 Data Protection Act. chief executive. “Time is of the essence profit in 2019. Alice Hancock holidays — having seen signs of increase
ant is the representative claimant in the Google is appealing against the decision. in fraud around camper van sales.
Charlie Bibby
Media
Music bible NME feels the beat of a new youth audience with Asian launch
Nic Fildes across the region. BandLab, which also scratching the surface of what’s on offer oned Britpop. But it struggled to survive lance writers to capture the flavour of
owns music instrument shops and oper- musically across the region.” in the digital era. Even after the local music scenes.
The NME, once the cultural bible for
ates a cloud-based music collaboration He argued that there was a large pool relaunch as a free sheet, circulation Heavier guitar-based rock and punk
generations of British pop, rock and
tool, was founded by Meng Ru Kuok, of “hidden talent” across the region, plummeted. It pulled its printed edition music remains popular in markets such
punk fans, is expanding into Asia as it
whose father is Kuok Khoon Hong, the with artists including Stars and Rabbit, in 2018 as rival titles including Sounds as Malaysia and Indonesia, whereas Sin-
targets young listeners of genres
billionaire chairman and chief execu- .gif, NIKI and the Itchyworms all poten- and Melody Maker collapsed. Q, gapore has veered more towards shoe-
including Malaysian heavy metal and
tive of commodities trader Wilmar tial breakthrough artists that the NME another music magazine, ceased publi- gaze, or dream pop. A form of neo-
Singapore’s “shoegaze” scene.
International. could champion. “Watch this space,” he cation in July. psychedelic rock that emerged in the
Once a dominant force in music pub- Mr Kuok argued that the NME has said. BandLab, which has previously UK in the early 1990s, it has remained
lishing, the NME was acquired by Singa- historically resonated with younger fans The emergence of a dedicated Asian bought and sold a stake in Rolling Stone popular in the Asian country due to the
pore’s BandLab Technologies for an in the UK and should do so in Asia, NME is an unexpected second act for magazine, believes the NME brand success of bands such as Astreal.
undisclosed sum last year with a view to which has a similar youthful, music- the British music magazine that was could expand further if coupled with its BandLab said it is likely to launch
expanding its international reach. hungry audience. launched in 1952 as the Accordion other music businesses. The number of localised NME sites into other Asian
Under its new owners it has since “Right now, more than half of the Times and Musical Express. musicians using BandLab to upload markets over time. A Japanese-lan-
launched an Australian version, includ- world’s youth lives in Asia,” he told the It charted the rise of the Beatles and music online has boomed during the guage NME already operates under a
ing a print edition, and this week will Financial Times. “The world is increas- the Who in the 1960s, the punk explo- pandemic, rising to 22m from 12m, brand licence signed under the maga-
roll out English-language music sites in ingly looking at Asia, seeing the success sion in the 1970s — when it was name- according to the company. zine’s former owners, TI Media, but
Singapore, Malaysia and the Philippines of K-Pop, and wondering what’s beyond checked by the Sex Pistols in the song The new NME Asia will hire only a Stars and Rabbit, the Indonesian BandLab wants eventually to launch an
as part of its first phase of expansion just Korea, because that’s barely Anarchy in the UK — and later champi- handful of staff and will rely on free- pop-folk band, has a solid following English-language version.

AUGUST 20 2020 Section:Companies Time: 19/8/2020 - 18:16 User: cathy.pryor Page Name: CONEWS3, Part,Page,Edition: LON, 10, 1