Time Is Running Out!

Time Is Running Out!!                                                                       17 December 2020

The latest Valustrat report points to a stabilisation in property prices in 2021 with two caveats – the economy recovers from the pandemic-induced slowdown and government initiatives, including overseas visas for expatriate retirees and the expansion of the ten-year golden visa scheme, attracts foreign professionals. The report further adds that it expects increased buying activity from China and higher business activitie,s brought on by the delayed six-month Dubai 2020 Expo, starting next October, as well as the 50-year anniversary of the UAE.. Furthermore, the recent reforms in commercial and inheritance laws, along with the easing of certain other social restrictions, have done much to improve both business and expat confidence, which has a knock-on impact on the realty sector.

Although Chesterton’s Mena expects stability to return to the sector in 2021. It stlll sees moderate declines next year, although there will be differences between property types and locations. ValuStrat estimates that November property prices are down 13.8% on the year, but only 0.2% month on month, making it still a buyers’ market.  Villa prices in Jumeirah Village and Dubai Sports City recorded the biggest falls of 14.8% and 14.4%, whilst Discovery Gardens, Dubai Production City, Jumeirah Village, Business Bay, Burj Khalifa and Dubai Marina dropped 16.8%, 16.4%, 16.0%, 14.5%, 15.2% and 13.8% respectively. However, with such low prices, there has been strong buying interest in certain locations, including Dubai Marina, International City, Jumeirah Lake Towers, Arabian Ranches, Jumeirah Village, Meadows, Business Bay and Downtown Dubai.

Next year, Cavendish Maxwell expects the Dubai market portfolio to increase by 50k, but this does seem to be on the high side. There is no doubt that with developers, such as Emaar and Damac, curbing new supply, by temporarily curtailing all future developments, market equilibrium will soon come into play. Two major trends which started in 2020 will continue into the new year – the secondary market will dominate transactions and increased demand for villas in selected locations will continue.

The following uses official data from the Government of Dubai’s Statistics Centre. In the past five years, to mid-December 2020, Dubai’s population has increased 40.5% from 2.43 million to 3.41 million but only by 0.07 million, 0.2%, over the past year because of the impact of Covid-19. Meanwhile, the number of units at the end of 2015 totalled 481.6k (397.6k apartments and 84.0k villas), increasing by 168.3k (23.4%) to 649.9k (537.4k apartments or by 35.2% and 112.5k villas or by 33.9%). Over that four-year period, the population, expanded by 38.3%., at a slightly quicker rate than the rise in residential units.

A new law, introduced by HH Sheikh Mohammed bin Rashid Al Maktoum, sees the establishment of a special tribunal to oversee the liquidation of unfinished and cancelled projects, as well as the settling of related claims; this will supersede the 2013 law, dealing with cancelled projects, and will also take up existing cases that the previous committee has not settled. Decisions made by the special tribunal will be “final and uncontestable”, If the Dubai Land Department’s Real Estate Regulatory Agency has confirmed a project cancelled, the tribunal will be responsible for liquidating the assets and will “define the rights of investors and purchasers”.  More importantly for the end user – and in a step that will encourage increased investment into the residential sector -a second decree states that if a developer fails to start a property project for reasons beyond their control, or if it has been cancelled by Rera, the developer in question “must refund the entire amount paid by purchasers”.

The Dubai Ruler also issued Law No. (14) of 2020 regulating the timeshare industry in the emirate, with the aims of strengthening the pertinent legal framework, along with stimulating both the tourism and real estate sectors. As tourism matures in the emirate, timeshare is increasing its footprint, giving adequate alternative residential alternatives for tourists and visitors, whilst encouraging investments in the vacation ownership sector. The management of the emirate’s timeshare industry has been handed to Dubai’s Department of Tourism and Commerce Marketing who will coordinate with the Dubai Land Department and Dubai International Financial Centre in all matters related to the timeshare-related activities of developers and brokers, and registration of timeshare contracts and right of usufruct. Timeshare permits will be valid for a renewable period of one year.

Emaar has named Mohammed Alabbar as its new MD, with him being replaced by Jamal Al Theniyah as Chairman, in a move brought on by new regulations that prohibit combining the chairmanship of a company with another executive position; Ahmed Jawa becomes the new vice-chairman. The move comes a week after Dubai’s largest property developer announced that it was holding back on new launches in a bid to overcome the current oversupply in the market. One consultancy reckoned that Dubai has 585k homes at the end of Q3 and nobody really seems to know how many will come to completion for the year 2020, with estimates ranging from 35k to 55k.

Reportage Properties is set to develop ten real estate projects, delivering 4k units, in both Dubai and Abu Dhabi. The Abu Dhabi-based developer noted that the real estate sector market is beginning to show positive developments, resulting in increased sales during the current year, particularly for residential units in Rukan Tower, which is being developed in Dubailand, in cooperation with the Continental Investment. Comprising 488 units of studio to 2 B/R apartments, with prices of US$76k, US$ 106k and US$ 163k respectively, the project will be ready for handover by the end of 2022. Last year, the developer launched Rukan Tower, consisting of two phases of 349 and 305 residential villas; 20% of the construction work has been completed.

It is estimated that the UAE has injected support packages of US$ 107 billion to try and support the economy, battered by the pandemic, with a selected committee formed to administer and oversee the process. Two of the packages included the Central Bank’s Targeted Economic Support Scheme in March, (to boost liquidity in the financial and banking sectors), and the US$ 13 billion Tess programme, offering zero-cost collateral funding to banks to encourage lending to the broader economy.  Other governmental measures have been added to ease the cost of doing business in the country. These include a major overhaul of commercial companies’ law and that, in most cases, the need for onshore companies to have an Emirati shareholder has been removed. Other ‘legal’ initiatives include major changes to the commercial transactions and bankruptcy laws, as well as the decriminalisation of bounced cheques.  The government has also allocated grants and incentives to tourism establishments and reduced tourism sector fees and taxes. To date, it is estimated that such measures have benefitted 10k SMEs, 1.5k private sector companies and more than 310k of the population.

The seasonally adjusted November IHS Markit PMI fell 0.9 to 49.0, on the month, with only titbits of positive news, such as job losses being at their lowest since February, as business picked up in the wholesale and retail sector. News of vaccines being available could result in a quicker than expected economic recovery.

In a move that intends to ease access to credit insurance and reduce exporters’ non-payment risk, Etihad Credit Insurance and the Israel Foreign Trade Risks Insurance Corporation (Ashr’a) have signed a deal to strengthen bilateral trade ties that will encourage exports and investments. According to the ECI, the annual exchange of trade between the UAE and Israel is expected to reach $4 billion, with the deal expected “to ease access to export credit facilities” for exporters and minimise risks associated with non-payment. Both parties will also explore mutual opportunities for co-insurance services for exporters and facilitating market access to SMEs.

In 2019, the UAE’s US$ 414 billion economy was driven by Abu Dhabi and Dubai, accounting for 59% and 28% of that year’s GDP. The latest report from S&P Global Ratings estimates that, because of the pandemic, the economy will lose 5.7% in value but will post a 3.1% expansion in 2021. However, the International Finance the Corporation expects the country to experience a contraction of 5.7 % this year, followed by a modest recovery of 3.1% in 2021.  It is not expected that the economy will recover fully until 2023, as sharp falls in key sectors – tourism and real estate – will take time to recover. The ratings agency indicated that Dubai’s economy would contract sharply on the back of the pandemic battering that the travel and tourism sectors have taken, as well as broad declines across the rest of the economy. However, there is every chance that the delayed Expo 2020 will prove a catalyst for some sort of economic recovery in Q4 2021.With the hydrocarbon sector production being boosted from 2022, with Opec+ oil production limits being lifted and new gas production coming on stream, the non-oil sector recovery will be driven by public investment in manufacturing particularly petrochemicals, logistics, and construction. Credit agencies have been hopelessly wrong in the past and there is every chance that this will be the case this time, with Dubai recovering much quicker and returning to pre-pandemic levels (and more) well before S&P’s 2023 mark.

UAE Q3 sales of mobile phones saw Chinese company Xiaomi joining the pack of the three main suppliers – along with Samsung and Huawei – as sales rose 6.4% to one million, quarter on quarter, partly driven by pent-up demand. The GCC witnessed a slight 0.2% decline in the period to 4.97 million units, with UAE sales accounting for 24.1% of the total, behind Saudi Arabia’s 52.6%; Saudi sales dipped because of the tripling of their VAT rate to 15%, pushing prices higher. Samsung remained the region’s leading provider, accounting for a 44.6% share. In units shipped, but second with a 30.8% share of the monetary value, indicating that the market preference is for the entry-level and mid-range price brands; this explains Samsung’s market share discrepancy between units sold and their monetary value. Q4 and Q1 sales will probably see similar quarterly unit increases, at around 6.5%, with brands like Apple (reportedly planning to increase iPhone production by 30% in H1 2021), and Samsung selling more with their newly released models.

It is estimated that the UAE accounts for 11% of the total global gold exports, with the country becoming increasingly important on the world stage. Trading in the yellow metal accounts for more than 29% of the total national non-oil exports and that, despite the pandemic, the gold trade was 6% higher, year on year to August. The federal government has introduced a new policy for the gold sector, aimed at enhancing the UAE’s governance of gold trade so as to align with best international practice. The new policy covers four areas – establishing the UAE’s standard for good gold delivery, development of a federal platform for gold trade, establishing a committee for the UAE bullion market, and building a database for companies and individuals involved in the gold trade.

Disgraced payments firm Finablr, which owns a number of foreign exchange and digital payments companies, including UAE Exchange, Xpress Money, Unimoni, Remit2India and Bayan Pay, has been sold to Global Fintech Investments Holding for a nominal US$ 1. GFIH – an affiliate of Israel-based Prism Group – has formed a consortium with Abu Dhabi’s Royal Strategic Partners to purchase Finablr and will provide the company with working capital to help it operate and support its creditors and employees; it will also undertake to support and facilitate the company’s continued efforts to recover funds from third parties  The BR Shetty  company was listed on the London Stock Exchange in May 2019, at which time it also owned the Travelex foreign exchange business,  which has since been divested to another lender Then it was valued at US$ 1.5 billion but was hit with two major problems – a cyberattack on Travelex, along with the unfolding collapse of its parent firm, BRS Investment Holdings. In May, with it being disclosed that its debt was US$ 1 billion more than what was accounted, itappointed a law firm to “investigate historic potential malfeasance within the Finablr Group and any misappropriation of assets” in July.

A JV with the Republic of Rwanda will see DP World launch its new global B2B and B2C e-commerce platform, DuBuy.com,  following a Memorandum of Understanding with the Rwanda Development Board. Apart from making it easier for Rwandan companies to trade on the international stage, it will also strengthen commercial trading links between the UAE and Rwanda. The platform will enhance the promotion of exports of coffee, tea, and horticulture from the African country. DP World, which has already invested in world class port and logistics facilities in Kigali, will also assist with improvements to the country’s supply chain logistics, including in rural areas, and access to digital tools to help businesses become more efficient and expand their reach to local, regional, and global markets.

A new law enacted this week sees the granting of more autonomy to the Dubai Civil Aviation Authority, in tandem with the UAE’s General Civil Aviation Authority. Whilst also boosting sectorial safety, security and sustainability, its twin aims are to consolidate the emirate’s global leadership in the civil aviation sector, and also to enhance its attractiveness as a destination for aviation businesses. A government spokesman commented that “under the new law, DCAA is authorised to sign agreements … related to air traffic rights to operate via Dubai airports, and implement them in co-ordination with the GCCA.” The local agency will represent Dubai in all civil aviation matters, including all nature of negotiations, including air traffic rights, and accident investigations. Dubai will no longer have to seek approval from the GCAA, and report Dubai’s air traffic data to the federal regulatory body.

Dubai Aerospace Enterprise has a deal with American Airlines to deliver eighteen Boeing 737 MAX 8 aircraft, with the first of those arriving to the airline this week. DAE’s owned and committed fleet includes twenty-two Boeing 737 MAX 8 aircraft, which has just been allowed to return to US skies, some twenty-one months since two fatal crashes saw the plane being grounded. This is part of the Purchase and Leaseback agreement signed with the US carrier in Q3.

Following governmental directives, Dubai-based district cooling provider Emirates Central Cooling Systems Corporation has started reducing fuel surcharge on electricity and water for more than 140k of its customers,  reducing charges by US$ 13.1 million. Empower, which has an availability of a total cooling capacity of 1.53 million refrigeration tonnes, is keen to increase the share of renewable and clean energy in Dubai’s energy mix, in line with government targets of 25% from renewable sources by 2030 and 50% by 2050.

Recent figures indicate that foreign interests have invested US$ 5.8 billion, totalling 8.4 billion shares, in the six real estate companies listed on the Abu Dhabi and Dubai financial markets as on 09 December. As with most listed companies, foreign ownership of up to 49% of a company is allowed and perhaps this has helped the Dubai bourse jump 17.9 % over the previous four weeks. The significant rise in the number and value of shares owned by foreign investors in real estate companies has followed a surge in their share prices in recent months. Three of the Dubai listed companies – Emaar, Damac and UP – accounted for 35.51%, 33.83% and 17.06% of all real estate companies’ shares listed. It is expected that the percentage of foreign share ownership will continue to move north in the future.

The bourse opened on Sunday 13 December and, 260 points (17.9%) to the good the previous five weeks, nudged 3 points higher to close on 2,550 by Thursday 17 December. Emaar Properties, US$ 0.11 higher the previous week, traded US$ 0.02 lower at US$ 0.96, whilst Arabtec is now in the throes of liquidation, with its last trading, late in September, at US$ 0.14. Thursday 17 December saw the market trading at 160 million shares, worth US$ 59 million, (compared to 456 million shares, at a value of US$ 80 million, on 10 December).

By Thursday, 17 December, Brent, US$ 9.30 (22.6%) higher the previous four weeks, gained a further US$ 0.97 (1.9%) in this week’s trading to close on US$ 51.35. Gold, US$ 2 (0.1%) lower the previous week, gained US$ 43 (2.3%) to close on US$ 1,837, by Thursday 17 December.

Bitcoin has once again hit a new record. with the cryptocurrency having tripled in value this year, trading at US$ 22,945 by the end of Thursday trading. With bitcoin’s supply capped at 21 million, investors see it as a hedge against the risk of inflation, with governments and central banks turning on the stimulus taps to tackle the negative impact of Covid-19. When this particular “tap” is turned off, there will be those who will search for alternative currencies due to constant fiat money debasement. Only four years ago, it came close to topping the US$ 20k mark but since then has hit extreme lows and even falling below US$ 3.3k. Despite BoE Governor Andrew Bailey (and he has been wrong before) cautioning over its use as a means of payment, it is being widely utilised as a form of payment with PayPal among the most recent adopters of the digital currency.

In a cash deal of over US$ 3.9 billion, Zurich Insurance is planning to acquire MetLife’s US property and casualty business, extending its reach of its Farmers subsidiaries; it is expected that the cost of the purchase will be divided between Zurich’s Farmers Group and Farmers Exchanges subsidiaries in the US. Zurich, which saw its gross written premiums declining 3% to US$ 15.3 billion in Q3, hopes that with the Farmers businesses gaining a nationwide presence and access to MetLife’s distribution channels to 3.8k companies for ten years, will see a boost in its revenue stream. The MetLife deal, which includes 2.4 million policies and a reported US$ 3.6 billion net written premiums, is expected to contribute a 10% return on investment to Zurich’s earnings from 2023.

UK’s video-game-maker Codemasters, in a deal worth an estimated US$ 1.2 billion, has been acquired by games giant Electronic Arts which owns the global franchise to Need for Speed. Codemasters, also involved in racing games, including the Dirt Rally series and Formula 1 licences, had earlier rejected a US$ 973 million offer from New York-based Take-Two Interactive and has indicated that it would recommend its shareholders accept the offer. However, there is still a chance that Take-Two could respond with a better offer, which would see the two US gaming giants raising the stakes for Codemasters, founded in 1986 by two schoolboy brothers.  

Cyberpunk 2077, touted as one of the biggest gaming releases of the year, has been pulled from PlayStation stores after complaints of bugs, compatibility issues and even health risks; its long-awaited arrival had already been delayed twice. This will be a major blow for Sony Interactive Entertainment, as this is one of the most expensive video games ever made,  The company has indicated that it will “begin to offer a full refund for all gamers who have purchased Cyberpunk 2077 via PlayStation Store”. It will also remove the game until further notice.

It seems that the huge on-going financial scandal, bedevilling Germany, may claim another victim, Ralph Bose, who has headed Apas, the country’s accounting regulator, since 2016; before that, he was a senior partner at the Big Four firm, KPMG.  He has confessed that he had bought and sold shares in Wirecard last April, at the same time, his own watchdog was investigating the fraudulent payments company auditor, EY. It seems that many were aware of Wirecard’s problems even before Apas opened a preliminary probe into EY’s audit work in October 2019 and it took the watchdog a further eight months to open a full investigation, whilst in September it filed a criminal case against three EY auditors. It looks highly likely that another one will bite the dust.

Covid-19 has not been kind to AMC Entertainment Holdings, the world’s largest movie theatre operator, which has seen attendances slump by 92% in the US and 86% internationally. It has secured a further US$ 100 million in emergency funds – but that will only see it to the end of December at best, as its average monthly cash burn has been 25% higher at US$ 125 million. Whist most of the cinemas have been closed, the growth of streaming has becoming so popular that there is no doubt it will continue to present a major problem, even when some sort of normalcy returns to the screen. Both Warner and Disney have plans to push more of their new releases through streaming services – the former confirming that all of its 2021 films will be released online on the same day, with Disney also indicating that it plans to push more of its films to its Disney+ streaming service.

Ride-hailing firm Uber Technologies Inc was fined $59 million on Monday for failing to provide the California Public Utilities Commission (CPUC) with information on certain sexual assault and harassment claims between 2017 – 2019.

Following the earlier success of DoorDash, Airbnb hit the jackpot this week when its IPO share price of US$ 68.00 ended its first trading day 112.8% higher at US$ 144.71, proving the resilience of the home sharing company, during a year when global travel ground to a halt; a year earlier, 54 million guests stayed at an Airbnb. The closing price gave the company a valuation of just over US$ 100 billion, although Airbnb only raised US$ 3.7 billion in its offering, making it the biggest US IPO this year.  It still is a mystery how a company can be so valued even though it has never made a profit – and its nine-month revenue to September was down 32% to US$ 2.5 billion. It is reported that Airbnb controls around 39% of the global short-term rental market and is the market leader in Europe but trails VRBO, a vacation rental company owned by Expedia, in North America. It has 7.4 million listings in 22 countries and operated by four million hosts.

Another week, another IPO and another jackpot for investors but this time it was not in the US but India where Burger King jumped 87.5% on its market debut on Monday, with each US$ 0.82 share closing on US$ 1.53.  At the beginning of the day, the company, that runs the franchise of Restaurant Brands International Inc’s US chain Burger King, was valued at US$ 583 million and ended worth almost US$ 1.1 billion. The IPO raised about US$ 110 million and was an indicator that the country’s food service sector was moving forward.

A rarely known fact is that sportswear firm Reebok started life almost seventy years ago in Bolton, England, but was later bought by an enterprising US entrepreneur. The company became a global player in 1982 on the back of its development of the Reebok Freestyle aerobics shoe, the first athletic shoe designed for women, at the start of the aerobics fitness trend. Adidas, which acquired the company in 2006 for US$ 3.8 billion, is now possibly in the market to sell it and will decide by March; it seems that interested parties could include the private equity firm Permira, which owns the Dr Martens footwear company, and Timberland brand owner, VF Corp. 2019 figures of an increase in revenue to US$ 2.1 billion only account for 7% of Adidas’ total annual sales. Currently, Reebok, based in Boston, currently has a six-year US$ 70 million deal with Ultimate Fighting Championship.

McLaren is to sell as much as 33% in its racing unit to a US consortium led by MSP Sports Capital and is set to receive US$ 245 million – funding that will be spent to refinance bonds due in 2022 and repair its finances to continue developing new models. At this level of investment McLaren’s racing unit is valued at US$ 740 million. To raise extra financing, the company is considering a sale of its Woking headquarters. Continuing the F1 connection in the week that saw the Abu Dhabi Grand Prix closing the 2020 season, Ferrari was in the news ,with the sudden departure of its chief executive Louis Camiller;  he was quickly replaced by an Agnelli family descendant, John Elkann, on an interim basis.

Aiming to help Americans, who were struggling because of the pandemic, MacKenzie Scott, has donated more than US$ 4 billion to food banks and emergency relief funds in four months; this brings her total charitable donations to over US$ 6.0 billion with 380 charities benefitting from her largesse. The ex-wife of Amazon founder Jeff Bezos, and now the world’s 18th-richest person, has seen her personal wealth jump 156% this year to US$ 60.7 billion. Latest figures show that the US poverty rate has surged since June to reach 7.8 million citizens.

By the end of the week, once again, all three US markets hit record highs, with the Dow Jones gaining 147 points (0.5%) to close at its highest ever level of 30,302 points, whilst the benchmark S&P 500 closed 0.6% higher at 3,722, with the tech-heavy Nasdaq 0.8% to the good to 12,764 points.  The main drivers continue to be rising unemployment rates, surging pandemic cases and confidence that the US Government would need to pass a stimulus bill to bolster the economy. Latest data also points to manufacturing activity in the mid-Atlantic region cooling, with factories reporting a sharp slowdown in new orders and job growth.

There are reports that indicate that Spain will be the main beneficiary of the EU’s US$ 920 billion coronavirus fund, with a possible US$ 172 billion in project financing. Some of the country’s blue-chip companies – including Seat, Telefonica and Iberdrola – are making plans to ensure that they will receive funding. Other countries in the line-up include “old favourites” – Croatia, Bulgaria, Greece, Portugal and Romania – some of them which have had economic well documented woes in the past.

Meanwhile, the bloc’s stand-out economy, Germany, is heading for a double-dip recession, as the Merkel administration has imposed a severe four-week lockdown, which could knock off 4% from the country’s growth rate, compared to the 2.5% from the first lockdown earlier in the year.

The EU is to introduce a pair of laws – the Digital Services and Digital Markets Acts – focusing on competition and making platforms responsible for hosted content. The new laws will “overhaul” the digital market, including how tech giants operate, with transgressors facing heavy penalties. Driven by Competition Commissioner, Margrethe Vestager, and Internal Market Commissioner, Thierry Breton, they have noted that much of the current outdated law goes back to the start of the century and that “the business and political interests of a handful of companies should not dictate our future”, adding “that our rules and principles are respected everywhere. Online as well as offline.” In the past, the EC has taken swipes at the US tech giants, such as Google and Facebook, and their market dominance along with their preponderance to utilise the data they gather from one service to “improve or develop” a new one in a different area, making it difficult to compete with them. Labelling such firms “gatekeepers”, that “set the rules of the game for their users and their competitors”, the EU will surely have a battle on their hands.

Cuba is set to devalue its peso to US$ 0.24 on 01 January 2021, as the government struggles with its worst economic crisis since the collapse of the Soviet Union. For years, the currency has been artificially set at parity to the greenback. The Miguel Diaz-Canal government plans to raise state wages and pensions fivefold to compensate for the almost-certain jump in inflation, driven by the devaluation. However, this move will only benefit 60% of the working population, with the 40% balance working in the private and informal sectors.

In a rare setback for the Australian medical research centre, Australia has cancelled plans to proceed with CSL’s promising Covid vaccine, as clinical trials, being developed by the University of Queensland and CSL, have been abandoned because some participants returned what are called false positive test results for HIV. (Importantly, the participants did not develop HIV or any of its symptoms, but in tests for disease they returned results that incorrectly looked positive for it). The federal government had already signed deals with four companies for the supply of a Covid vaccine including 51 million doses from CSL. CSL is one of the country’s most valuable companies, having started the century, with a share value of US$ 5.30, and, having doubled its price over the past five years to US$ 255, last March it temporarily become the largest market cap on the ASX; last year, it posted a profit in excess of US$ 1.6 billion.

Once a geological survey and fundraising are finalised, work is planned to start in 2026 in Western Australia on a US$ 27 billion project to mass-produce hydrogen, from renewable power sources; this could present the country a major revenue generating opportunity to move away from coal to clean energy exports. When completed, it will churn out 1.75 million tons of hydrogen annually, equating to enough fuel for thermal power plants equivalent to six nuclear reactors Utilising a leased space of 6.5k sq mt, (six times the size of Hong Kong), the Asian Renewable Energy Hub plans to build wind turbines and photovoltaic systems generating 26k megawatts. The four-company consortium, including a private investment company affiliated with Australia’s Macquarie Group, aims to meet Canberra’s hydrogen production cost target of US$ 1.50 per kg; this would inevitably generate massive demand, as the current cost in Japan is US$ 7.20. The country aims to become a hydrogen powerhouse by 2030 and expects the hydrogen sector to contribute as much as US$ 19.5 billion to GDP in 2050.

The Financial Conduct Authority, which was then led by the current Bank of England Governor, has been reprimanded for failing to “effectively supervise and regulate” London Capital and Finance which collapsed in January 2019. Records show that some 11.6k investors had lodged US$ 330 million before its failure, with many who lost all their investment may now receive a one-off compensation; the firm was offering 8% for people investing for more than three years. Former Court of Appeal judge, Dame Elizabeth Gloster, who wrote the review, noted that FCA’s “flawed approach” allowed LCF to look respectable, even regarding its non-regulated products and that Its failure to regulate properly was due to “significant gaps and weaknesses” in its practices and policies. It concluded that “responsibility for the failure in respect of the FCA’s approach to its perimeter rests with the executive committee and Mr Bailey”. Belatedly the current governor, appointed in March 2020, was gracious enough to apologise to those, many of whom were first-time investors, who lost life savings whilst he got promoted to the top job in the banking world. To make matters worse, several independent financial advisers had warned the FCA, some four years earlier, about what they felt were “misleading, inaccurate and not clear” adverts, often promoted on social media.

By the end of the week, hopes of a Brexit deal grew, as it was reported that the EC President, Ursula von der Leyen had told the European Parliament that that “there is a path to an agreement now”, albeit a narrow one. Boris Johnson later joined in the farce telling UK lawmakers that there was “every hope, every opportunity” of a deal if the EU were to recognise the country’s sovereignty in important areas. Even MPS, who were yet on another holiday, were put on standby to approve any last-minute deal.  Sterling responded well to the news reaching two-year highs of US$ 1.35 and even bookies now estimate there is an 81% chance of a deal. It does seem incongruous that the original referendum was in June 2016 and it has taken so long to come to this stage. But the EU does have form when it comes to last minute deals but Time Is Running Out!

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