It’s A Sign Of The Times!                                               29 March 2024

Q1 is well on course to see the Dubai real estate sector post over US$ 27.2 billion, (AED 100 billion) in sales and over 30k transactions. The first two months of the year witnessed a 30.9% increase in sales to US$ 19.6 billion and a 26.6% rise in transactions to 22.9k. There is no doubt that the promising start to the new year bodes well for another positive year for the sector, driven by government initiatives and infrastructure developments, along with significant launches from Emaar and Nakheel. It is hard to disagree with Realiste, a specialised prop-tech firm in real estate investment solutions, anticipating a 15% growth in Dubai’s real estate market this year, with its founder Alex Galt noting Dubai’s appeal in aspects such as safety, cleanliness, tourism, and overall quality as a driving force behind its anticipated rise as a global real estate hub in 2024. Its latest analysis sees specific areas within Dubai, including Business Bay Second and Palm Jumeirah, posting substantial price increases this year, further enhancing the attractiveness of real estate investments in these locales. The fact that Dubai

saw a 12% increase in enrolments, with an additional 39k students enrolling in private schools, indicates that Dubai is becoming an ever-increasing hub for growing families. One major obstacle could be affordability in the low to mid-market segment, but this could be partly offset by declining mortgage rates and easing inflation/cost-of-living, along with limited post-handover payment plans now seen in the off-plan market.

CBRE posted that “looking ahead, price growth in both Dubai’s apartment and villa segments of the market are likely to remain relatively strong; however, we do expect that the rate of price growth will taper off. In the rental market, on the back of the prevailing market fundamentals, the lack of supply and heightened demand levels, we expect that residential rents in Dubai will maintain their upward trajectory; that being said, the rate of growth will likely moderate further.” A common theme seems to be that growth will continue this year but at a slower pace. Further down the road, it is inevitable that this bull market, which is now over three years in the making, will turn. Unlike the last bear market, any downturn will be orderly and could still be some two years away.

February’s ValuStrat Price Index (VPI), 23.1% and 2.1% higher on the year and the month, registered 164.1 points. Compared to its 100 points base set in January 2021, villas were at 206.1 points, and apartments were 136.6 points. The index is meant to show updated residential capital values on a monthly basis and for Dubai’s residential rental values on a quarterly basis. On a monthly and annual basis, the apartment submarket rose by 1.9% and 18.6%, with the highest year on year capital growth in apartments posted in Discovery Gardens (30.7%), The Greens (27.9%), Palm Jumeirah (27.4%), Town Square (23.0%), and Dubai Production City (22.9%). Villa gains were more noticeable – at 2.4% and 28.0% on a monthly and annual basis. The top annual performers were Jumeirah Islands (36.1%), Palm Jumeirah (35.1%), Dubai Hills Estate (33.6%), and Mudon (29.6%). Off-plan Oqood (contract) registrations jumped 32.6% annually and 5.7% monthly, with ready home transaction volumes growing 30.5% annually and 9.0% monthly, representing a minority 36.9% share of overall February residential sales. There were twenty transactions of ready properties priced over US$ 8.17 million, (AED 30.0 million), located in Emirates Hills, Palm Jumeirah, District One, Jumeirah Bay Island, and Dubai Hills Estate.

The top four selling developers in the month were Emaar (13.3%), Damac (9.9%), Danube (7.6%), and Sobha (5.7%). Top off-plan locations transacted included projects in Jumeirah Village Circle (11.8%), Dubai Maritime City (11.4%), Business Bay (6.4%), and Bu Kadra (4.5%). The majority of ready homes sold were in Jumeirah Village Circle (9.0%), Business Bay (7.2%), Dubai Marina (5.9%), Downtown Dubai (5.8%), and Dubai Hills Estate (5.1%).

Within a few days of its launch, AHS Properties has confirmed that it had already sold 80%, (valued at US$ 681 million), of its US$ 845 million Casa Canal Interiors by Fendi Casa. The tower houses a diverse range of luxurious units, of between 4.5k sq ft – 30.0k sq ft, including exclusive boutique houses, four to six-bedroom sky villas, penthouses and sky palaces. The project was designed by Shaun Killa and interior designs will be by Hirsch Bedner Associates – HBA. Amenities will include a cigar lounge, private pools, fine-dining options, a state-of-the-art spa, wellness, and recreational arenas (yoga and beauty rooms), a screening room and a concierge/chauffeur service. The Dubai-based luxury real estate developer was founded seven years ago by Abbas Sajwani.

It is reported that Samana Developers is planning to launch eighteen projects this year, valued at US$ 3.40 billion, with contracts for all those projects being signed in 2024. The Dubai-based private real estate firm said it will launch 11k units in locations such as Arjan, Jumeirah Village Circle, Marjan, Dubailand, Discovery Gardens, Furjan, Motor City, Sports City and Meydan. By the end of last year, Samana was one of the top ten developers in Dubai – this year, it hopes to be in the top five fastest-growing firms. It is also looking at an inaugural development in Ras Al Khaimah, and “also planning a five-star hotel in Marjan island”. Samna has already appointed an advisory firm to apply corporate governance to be IPO-ready for the Dubai listing, “towards 2025-2026.”

According to Valustrat, there are now almost 25k active Airbnb listings in Dubai – a massive 227% increase from 2021’s figure of 11k; current annual average occupancy is at 56%. The agency notes that over 50% of listings are to be found in the following four locations in Dubai’s prime tourist hotspots – Dubai Marina, Jumeirah Beach Residence, Downtown Dubai and Business Bay. The average profit margin of about US$ 1k per unit each month and most will aim to build a portfolio comprising tens of properties. In 2022, Dubai was ranked as the most profitable and expensive location in the world for Airbnb landlords, according to a survey by UK-based landlord insurance company CIA Landlords. The sector is heavily regulated with anyone, with a holiday home for rental, having to register with the Department of Economic Development to get a licence from the Department of Tourism and Commerce Marketing. Each subleased property has to have permission from the owner and a move-in permit is required from each building.

Over the past twelve months, the Department of Economy and Tourism noted that it had closed down three Dubai car rental companies for violating the laws related to consumer protection rights. Ahmed Ali Mousa, director of consumer protection at Dubai’s DET, advised that “there are different categories of fines, depending on the violation, with a minimum of Dh10k, (US$ 2.72k). If the violation is repeated, the fine is doubled each time. However, we don’t wait till that time. If the violation is repeated, such companies’ offices are closed.” Recently, it issued a circular to all vehicle rental firms to return deposits of the customers, within thirty days of returning the vehicle. The RTA notes that there has been a 23.7% rise in the number of companies registered, with an increase of registered vehicles to 78k. The director also noted that the Department also penalised some car rental firms for exorbitantly charging for car washing, and advised users to ensure they have a clear contract with the company and if “they face any challenges, they are welcome to reach out to us for any protection through our call centre or website.”

An aviation company in Dubai has signed a deal with a Dutch business to bring the world’s first flying car to the Middle East and Africa. Aviterra, which will be PAL-V’s exclusive agent, will order one hundred PAL-V’s Liberty flying cars and invest in the European company; no details or delivery timetable were available. The two-seat Liberty – described as the world’s first flying car because it combines a gyroplane and a car – transforms from a road vehicle into an aircraft, within five minutes. This vehicle, which will be able to be used from home to home, can reach 100 kph, within nine seconds, and has a top speed of 160 kph; as an aircraft, it has a flight range of between 400 km and 500 km and a maximum speed of 180 kph. It can reach an altitude of 11k ft and requires an airstrip or airfield stretching at least 200 mt to take off and land. Its current price is set at US$ 799k.

Last year, the Dubai International Chamber posted a 550% increase in attracting one hundred and four SMEs to the emirate, with businesses from the ME/Eurasia and Asia/Australia accounting for 32% and 29%. Sector-wise, trade/logistics, IT – including AI, blockchain, robotics and software, food/agricultural, healthcare/pharmaceuticals and public services accounted for 17%, 13%, 10%, 9% and 7%. The total number of global representative offices operated by the Dubai International Chamber almost doubled to thirty-one last year, from sixteen a year earlier. Mohammad Ali Rashed Lootah, President and CEO of Dubai Chambers, commented that “our network of international representative offices in key global markets has effectively promoted Dubai’s business community and highlighted the emirate’s value for companies seeking global expansion.”

Formed only two weeks ago – and to coincide with the start of the holy month of Ramadan – by HH Sheikh Mohammed bin Rashid, an education fund to help disadvantaged families around the world has already raised US$ 210 million, (AED 770 million); its target is US$ 272 million (US$ 1.0 billion). The Mothers’ Endowment campaign, inspired by the role mothers play in society, was created to provide educational materials, start social programmes and equip schools. Mohammad Al Gergawi, secretary-general of Mohammed bin Rashid Al Maktoum Global Initiatives, noted it “builds upon the success of previous charity and humanitarian initiatives launched in the UAE, which helped to drive development across underserved communities through a series of sustainable programmes that improve quality of life and ensure well-being”.

Last week, the UAE Ministry of Finance announced the launch of a digital public consultation to gather the views of relevant stakeholders on the implementation of the Global Minimum Tax (GMT) or Global Anti-Base Erosion Model Rules (Pillar Two) (GloBE Rules) as well as other tax matters. The consultation will be open from 15 March to 10 April and accessible via the ministry’s website or the UAE’s Government Portal. The government is expecting a big response from all stakeholders ranging from multinational groups operating in the UAE, advisors, service providers and investors. There are two sections to the consultation – the first is to gather the views of stakeholders concerning the potential policy design options for the implementation of the GloBE Rules in the UAE, specifically the development of a domestic minimum tax. The second part of the consultation is to understand stakeholders’ views on the introduction of substance-based incentives to be applied in the UAE.

Driven by an almost doubling in its education platform and a 14% hike in healthcare, Amanat Holdings posted a 40% jump in 2023 revenue to US$ 196 million; EBITDA increased 46% on the year to US$ 75 million, with Adjusted Net Profit before Tax and Zakat 38% higher on the year to US$ 43 million. Consequently, the company was in a position to declare a US$ 14 million dividend, with additional interim dividends planned for 2024.

Dubai Electricity and Water Authority’s shareholders have approved a total dividend payment of US$ 845 million (AED 3.01 billion). The next twelve-month dividend yield is 5.0%, with reference to IPO share price of US$ 0.676, (AED 2.48), per share. Saeed Mohammed Al Tayer, MD and CEO, commented: “Dewa is committed to achieving operational excellence and sustainable growth. In 2023, Dewa’s annual revenue exceeded AED 29 billion, (US$ 7.90 billion), operating profit was over AED 8.7 billion (US$ 2.37 billion) and EBITDA was over Dh14.7 billion, (US$ 4.00 billion), all figures reflecting the highest in its history”.

At the Emirates Central Cooling Systems Corporation’s AGM, shareholders approved its board of directors’ proposal to distribute cash dividends of US$ 116 million (US$ 0.0158 per share, equivalent to 42.5% of the company’s paid-up capital). Earlier in the year, Empower had posted record annual revenue of US$ 827 million and net profit of US$ 262 million for the year ended 31 December 2023. The company was listed in 2022 on the DFM and the dividend distribution was in alignment with the company’s dividend distribution policy – to pay a minimum dividend amount of US$ 232 million per annum in the first two fiscal years; following its listing – a US$ 116 million H1 dividend was paid last October.    

The DFM opened the week on Monday 25 March 27 points (0.6%) higher the previous fortnight, shed 16 points (0.4%) to close the trading week on 4,246 by Friday 29 March 2024. Emaar Properties, US$ 0.05 higher the previous fortnight, shed US$ 0.05, closing on US$ 2.23 by the end of the week. DEWA, Emirates NBD, DIB and DFM started the previous week on US$ 0.67, US$ 4.81, US$ 1.60, and US$ 0.39 and closed on US$ 0.66, US$ 4.77, US$ 1.59 and US$ 0.40. On 29 March, trading was at 326 million shares, with a value of US$ 114 million, compared to 275 million shares, with a value of US$ 418 million, on 22 March 2024.

The bourse had opened the year on 4,063 and, having closed on 29 March at 4,246 was 183 points (4.5%) higher. Emaar started the year with a 01 January 2024 opening figure of US$ 2.16, to close the quarter at US$ 2.23. Four other bellwether stocks, DEWA, Emirates NBD, DIB and DFM started the year on US$ 0.67, US$ 4.70, US$ 1.56 and US$ 0.38 and closed YTD at US$ 0.66, US$ 4.77, US$ 1.59 and US$ 0.40.  On 29 March, trading was at 326 million shares, with a value of US$ 114 million, compared to 138 million shares, with a value of US$ 58 million, on 31 December 2023.

By Friday, 29 March 2024, Brent, US$ 3.46 higher (4.2%) the previous fortnight, gained US$ 1.44 (1.7%) to close on US$ 87.00. Gold, US$ 299 (11.0%) higher the previous five weeks, gained US$ 73 (3.4%) to trade at US$ 2,238 on 29 March.

Brent started the year on US$ 77.23 and gained US$ 9.77(12.7%), to close 29 March 2024 on US$ 87.00. Meanwhile, the yellow metal opened 2024 trading at US$ 2,074 and gained US$ 164 (7.9%) to close YTD on US$ 2,238.  

Driven by an unexpected increase in US crude inventories, by 9.3 million barrels, in the week ended 22 March, on top of a two million barrel jump a week earlier, oil prices slumped mid-week, with Brent trading at US$ 85.35. The American Petroleum Institute also reported a 2.4-million-barrel rise in crude stocks – a fifteen-month high weekly increase – at the Cushing, Oklahoma storage centre, (with a capacity of ninety million barrels and accounts for 13% of total US oil storage). YTD oil prices had risen by some 11.0% due to Opec+ supply cuts and geopolitical uncertainty, and many analysts expect prices to settle around the US$ 90 level. The Opec+ alliance recently extended voluntary cuts of 2.2 million bpd into Q2 to stabilise oil markets, with every likelihood that the bloc will restore some barrels, (that could be as high as 1.5 million bpd), to the market in H2 to meet higher demand.

Probably not before time, Dave Calhoun will leave embattled Boeing by the end of the year, amid a deepening crisis over the firm’s safety record, further tarnished by an unused door being blown out on an Alaskan Airline Boeing 737 Max; in addition to its chief executive, the head of commercial activities will retire with immediate effect, whilst its chairman will not stand for re-election. The current supremo took over from Dennis Miulenburg, in early 2022, after the outcry from two brand new 737 Max planes having been lost in almost identical accidents that claimed the lives of three hundred and forty-six passengers and crew. On his appointment, he promised to strengthen Boeing’s “safety culture” and “rebuild trust”. Following the latest incident, a report from the US National Transportation Safety Board concluded that four bolts meant to attach the door securely to the aircraft had not been fitted, and to exacerbate the problem, Boeing is facing a criminal investigation into the incident itself, as well as legal action from passengers aboard the plane. In a letter to staff, he described the Alaska Airlines incident as a “watershed moment” for Boeing and it had to respond with “humility and complete transparency”. The question has to be asked if this was a “watershed moment,” what were the fatal crashes involving Lion Air and Ethiopian Airlines?

Under EU jurisdiction, justsix companies – Alphabet, Apple, Meta, Amazon, Microsoft and ByteDance – have obligations, under their 2022 Digital Markets Act, over uncompetitive practices; it is no coincidence that they are also the world’s largest tech firms. Now the EU has announced it would be investigating three of them – Meta, Apple, and Alphabet, which owns Google – for potential breaches of the DMA. If rules have been broken, fines can be onerous, with fines of up to  10% of annual turnovers. The EU said it will investigate five different possible acts of non-compliance:

• 1 & 2 – Whether Apple and Alphabet are not allowing apps to freely communicate with users and make contracts with them
• 3 – Whether Apple is not giving users enough choice
• 4 – Whether Meta is unfairly asking people to pay to avoid their data being used for adverts
• 5 – Whether Google preferences the firm’s own goods and services in search results

Another stock riding the current wave of AI optimism is Dell Technologies, with its founder and chief executive, Michael Dell, joining the likes of other tech billionaires, such as Bezos, Theil, and Zuckerberg who have been cashing in by selling stakes in their companies during the current price boom. It seems the fifty-nine-year-old, who formed the company in 1984, has been unloading his stock, to the value of US$ 465 million, for the first time in three years, this month. He still owns 50% of the company, currently valued at almost US$ 80 billion, (having gained 52.4% YTD), and is currently the thirteenth richest person in the world, with assets of US$ 99.7 billion. Maybe it is time for lesser mortals to do likewise, before some sort of reality returns to the market.

On its first day of trading, shares in Donald Trump’s media company soared past US$ 70, which then priced Trump Media’s Truth Social, at more than US$ 9.0 billion, but slipped back by the end of trading to US$ 58 – still 16.0% higher on the day. This will see Trump Media & Technology Group’s finances bolstered by a much needed US$ 200 million, with Trump’s stake currently worth more than US$ 4.0 billion; however, this comes with a caveat that many analysts say that this is far more than the firm’s performance warrants; in the first nine months of 2023, its revenue crawled to just US$ 3.3 million, with 8.9 million accounts, whilst it lost in the region of US$ 50 million; in comparison, recently-listed Reddit, with seventy million users, posted revenue figures of US$ 800 million and has an US$ eleven billion market cap.

Having been found guilty of stealing billions of dollars from customers, Sam Bankman-Fried, co-founder of the failed crypto exchange FTX, has been sentenced to twenty-five years in prison. FTX was one of the world’s largest crypto exchanges before its 2022 demise, turning Bankman-Fried into a business celebrity and attracting millions of customers who used the platform to buy and trade cryptocurrency. He was convicted by a New York jury last year on charges, including wire fraud and conspiracy to commit money laundering, after a trial that detailed how he had taken more than US$ 8 billion from customers, and used the money to buy property, make political donations and put toward other investments. There is no doubt that he got off fairly lightly, as the maximum sentence could have been for more than one hundred years.  Judge Kaplan also ordered the defendant to forfeit US$ 11.0 billion that can be used to compensate victims.

Following a review of its four hundred and fifty outlets, US-owned pizza chain Papa Johns has decided to close almost 10% of its restaurants that have been “underperforming”, having identified forty-three sites, all located in England, that were “no longer financially viable. Papa Johns had previously said it planned “strategic closures” in order to free up money for investment and improving profitability at its remaining UK sites, with plans also to expand further into non-traditional sites like holiday parks and the chain said it would “announce other large retail partners in the coming months”. With UK its second biggest market, it confirmed it was “committed to driving growth in the UK and improving results over the long term”.

Another leisure sector company, the London-listed leisure group Revolution Bars, which owns Peach Pubs and the Revolucion de Cuba chain, is also looking at closure of some of its venues – about 25% of its eighty locations – as it holds talks with investors about an emergency fundraising and also considering putting itself up for sale. This follows a period of “external challenges” which had hit trading it was “actively exploring all the strategic options available to it to improve the future prospects of the group”. When reporting on trading results in January, the company said that the Revolution brand was underperforming because the cost-of-living crisis had hit younger people harder.

Chris O’Shea is a lucky man having found out that his annual 2023 remuneration had jumped 82.2% to US$ 10.36 million, which includes an annual bonus (US$ 1.77 million) and long-term bonus, pension and benefits, (US$ 7.45 million). Most of the increase for Centrica’s chief executive, (who earlier in the year said his pay was “impossible to justify”, and a “huge amount of money” and that he was “incredibly fortunate”), came from the gas provider’s soaring share price over the past three years. In 2023, British Gas posted a tenfold increase in profits to US$ 1.04 billion after regulator, Ofgem allowed it to take a bigger slice of profits to recoup US$ 632 million it lost in the aftermath of the Russian invasion of Ukraine.

China’s third largest seller of smartphones, Xiaomi posted that it had received over 50k orders in the first twenty-seven minutes of sales of its Standard SU7 model, priced at US$ 29.9k, with the Max version selling at US$ 41.5k. Its entry into the very competitive EV market, with global sales slowing, will see Xiaomi in a price war with the big players such as BYD and Tesla, whose Model 3 retails for US$ 34.1k. SU7 will have a range of 700 km, compared to Model 3’s 567 km. The SU7 has drawn comparisons to Porsche’s Taycan and Panamera sports car models. It will be made by a unit of state-owned car manufacturer BAIC Group at a plant in Beijing that can produce as many as 200k vehicles a year, helped by a US$ 10.0 billion investment over the next decade.

2020 was a bad year for Australian/Chinese bilateral relations after Beijing imposed a series of tariffs and other economic burdens on more than a dozen Australian goods and commodities – including coal, barley, timber and lobsters – citing trade or production issues. However, other parties saw the move as a retaliatory campaign of economic coercion for political steps the Australia government had taken, including being the first Western country to bar Chinese tech firm Huawei from bidding for the country’s 5G tender and demanding an inquiry into the origins of Covid-19. This week, China has announced it will remove significant tariffs, of over 200%, on Australian wine, with the Albanese government managing to reduce other trade barriers; last August, China lifted tariffs on Australian barley. China had previously been the most lucrative market for Australian winemakers – accounting for nearly a third of all bottles shipped overseas – and despite pivoting to other markets, not all wine produced was sold so there has been a marked wine glut since 2021. It is estimated that the industry lost US$ 1.37 billion in 2021. China remains Australia’s number one trade partner and export destination for several commodities. Despite the tariff hits to certain industries – estimated to be worth about US$ 13.0 billion – the value of the China-Australia trade relationship has remained at a consistent level and trade has increased 12%. The majority of the value in the US$ 206.8 billion trading relationship comes from China’s reliance on Australian raw materials such as iron ore.

Over the past twelve months, CoreLogic’s Home Value Index has risen 8.9% – an indicator that Australian property prices continue to climb at an impressive rate; the current median dwelling value stands at US$ 208.6k – a new all-time high – and despite impressive price gains in recent years, demand continues to be robust, with little signs of a marked slowdown this year. The obvious main driver continues to be an excess of property demand over supply, with the consultancy noting that “the broad-based capital gains seen over the past year reflect the ongoing imbalance between housing supply and demand, which has helped to counteract the less favourable market and affordability conditions.” One of its market tools showed that 88.4% of the 4.63k house and unit markets analysed nationally saw values rise over the year, with Brisbane, Adelaide, and Perth witnessing the most widespread value uplift year-on-year, across both houses and units. It concluded that “positive net migration flows, low housing supply and comparatively low housing prices have all helped support widespread growth”.

On the rental side, the CoreLogic’s report also showed 94.2% of the 4.03k house and unit markets analysed recorded an annual rent rise, while nearly 40% saw rental values rise by 10% or more. Interestingly, the study noted that “over the past few years, rental growth has been skewed to capital city units, but as unit rent affordability has been eroded, some prospective tenants may be shifting towards house rentals, likely reforming larger households as a way of sharing the rental burden or to more affordable markets further afield.”

In its latest Financial Stability Report, issued this week, the RBA expects another tough year for households and businesses, but that the banking sector was well capitalised to absorb any losses from rising arrears. The RBA posted that “conditions will remain challenging for many households and businesses in Australia this year,” with many households facing financial pressure, not helped by decade-high interest rates and painful inflation. It noted that around 5% of borrowers with variable rate mortgages have had expenses exceeding their incomes, and that an expected half percentage point increase in the jobless rate would push most affected borrowers into cash flow shortfall, but not necessarily straight into mortgage default; February unemployment returned to 3.7% from a two-year high of 4.1% the month before. In a scenario analysis, the RBA found that most mortgagors and larger businesses would still be able to service debts if interest rates were to increase by another fifty bp from the current twelve-year high of 4.35%, and that less than 1% of all housing loans are ninety or more days in arrears and less than 2% of high-leveraged borrowers are in arrears. Concluding with some good news – the RBA expects pressures facing households will start to ease as inflation slows, real wages move higher and rates begin to decline, (probably in July).

The state-controlled Xinhua news agency has posted that Chen Xuyuan, a former president of the Chinese Football Association, has been sentenced to life in prison for bribery, after he recently pleaded guilty to taking bribes worth a total of over US$ eleven million. He is but one of more than a dozen coaches and players that have been investigated, as part of an anti-corruption crackdown, led by President Xi Jinping, that started with the real estate sectors and now encompasses sport, banking and the military. Chen abused his various positions as the president and chairman of Shanghai International Port Group by accepting money and valuables in exchange for his help with obtaining project contracts and arranging sporting events. The court ruling said he had brought “tremendous damage” to China’s football cause, with three other senior football officials having been sentenced to between eight and fourteen years in prison for corruption. Earlier in the year, Li Tie, an ex-Everton midfielder and former head coach of China’s national men’s soccer team, confessed to fixing matches and offering bribes to people, including Chen, to get China’s top coaching job.

Eleven years ago, the scandal of fixing the Libor and Euribor rates broke following which various banks were fined a total of over US$ 9.0 billion but rather predictably  no senior executives were ever prosecuted – in other words many picked up bonuses for what some would call dubious behaviour whilst other stakeholders, customers,  paid some years later; subsequent prosecutions in London and New York focused the blame on individual traders, with thirty-seven of them prosecuted for rate manipulation. Two of them, Tom Hayes and Carlo Palombo, both of whom have spent time “inside” before being released in 2021, were found guilty of rigging key interest rates have had their appeal against their convictions dismissed by the Court of Appeal. The convictions hinged on whether the traders acted dishonestly by influencing the setting of key Libor and Euribor interest rates, or whether it was normal practice at the time. In the US, rate rigging convictions, including for Mr Hayes, have been overturned after an appeal court said the US government had failed to provide evidence the traders had said anything false or broken any rules. However, the UK Court of Appeal said the US judgment “is not, and could not be, relevant” to the issues in English law; it also dismissed concerns that judges had decided whether their conduct was permitted, but this should have been for the jury to decide. The traders say they will now apply to take their cases to the Supreme Court. The UK is currently the only jurisdiction in the world that treats what traders did as criminal.

Despite declining falling food and fuel sales, (with the former mainly because of the month was the fourth wettest in history), February shop sales stayed flat, with clothing sales moving higher, driven by shoppers splashing out on the new season’s collections.; this has followed a lacklustre December, (down 3.2%), return, with a robust 3.6% bounce back in January. The sector is being hit by the double whammy of poor weather and challenging economic conditions., as the country recovers from the Q4 mild recession. Although Prime Minister Rishi Sunak has said the UK economy will “bounce back” in 2024, little credence should be given, as he has been proved hopelessly wrong with his previous forecasts.

Jeremy Hunt epitomises how out of touch the Sunak government is from economic reality. Last week, the millionaire Chancellor said that people on higher salaries still ‘feel under pressure’ and argued that his new tax cuts will help people on the average salary. He claimed that US$ 126k (GBP 100k), is ‘not a huge salary’ for people in his SW Surrey constituency after critics accused him of being out of touch. The Chancellor said “what sounds like a large salary – when you have house prices averaging around GBP 670k (US$ 846k) in my area and you’ve got a mortgage and childcare costs – it doesn’t go as far as you might think”. It seems that UK’s median gross annual salary for full-time employees was US$ 44.1k, (GBP 35.0k)  and in Surrey US$ 53.0k, (GBP 42.0k) – 58% lower than the Chancellor’s US$ 126k. The average punter in the UK must be asking how can politicians, with relatively huge fortunes, understand the impact of their decisions on people on the breadline? The names of some include the prime minister, Rishi Sunak, who according to The Times, was a “multimillionaire in his mid-twenties”, and his wife who claimed non-dom status for so long and did not have to pay UK tax. His family are believed to own four properties including a grade II-listed manor house in the village of Kirby Sigston, near Northallerton, in his Richmond constituency, which was bought for US$ 1.9 million in 2015 and a five-bedroom townhouse in South Kensington, London, which records show was last sold for US$ 5.7 million in 2010. He is also believed to own a flat in South Kensington in addition to a penthouse apartment with views of the Pacific Ocean in Santa Monica, California. His wife, Akshata Murty, is the daughter of the co-founder of Indian tech giant Infosys and her shares in the company are believed to be worth around US$ 543 million. Other millionaire Tories include the likes of Jacob Rees-Mogg, Nadhim Zahawi, Alister Jack and Sajid Navid.

Oji Holdings, a Japanese nappy maker, is the latest firm  to announce that  it will stop producing diapers for babies in the country and, instead, focus on the market for adults – an indicator that Japan has fast become an ageing population, where birth rates are at a record low; in the country last year, the number of babies born totalled 758.6k – 5.1% lower than the 2022 figure and the lowest number since the Nineteenth Century. In the 1970s, annual birth rates topped two million. Oji Holdings said its subsidiary, Oji Nepia, currently manufactures four hundred million infant nappies annually, compared to seven hundred million at its peak in 2001. It seems that sales of adult nappies outpaced those for infants in the country for more than a decade. the adult diaper market has been growing and is estimated to be worth more than $2.02 billion. Oji Holdings also said it would continue to make baby diapers in Malaysia and Indonesia where it expects demand to grow.

Japan now has one of the world’s oldest populations, with almost 30% of them aged sixty-five or older, and in 2023, the proportion of those aged above eighty surpassed 10% for the first time. This is creating a crisis for the Kishida government as it loses its third position in the economic world to Germany, not helped by a shrinking population.Efforts to date to address these challenges have met with little success for a variety of reasons – lower marriage rates, more women joining the workforce and the increased costs of raising children. Even the Prime Minister has noted that “Japan is standing on the verge of whether we can continue to function as a society,” adding that it was a case of “now or never”. Other Asian nations are in the same boat including South Korea, (which has the lowest birth rate in the world), Hong Kong, Singapore and Taiwan, where birth rates continue in decline. On top of that, an ageing population and the impact of a decades-long one child-policy, which ended in 2015, are also creating demographic challenges in China. It’s A Sign Of The Times!