Marketing Newscast

(Edited 04 February 2025)

China has announced a 15% import tariff on coal and liquified natural gas products imported from the USA, and a 10% tariff on crude oil, agricultural machinery and large-displacement cars in response to President Donald Trump’s 10% tariff on Chinese goods that came into effect at 5:01 GMT this morning. However, Canada and Mexico have been given a 30-day reprieve from his 25% tariff hikes after agreeing to ramp up border control and increase efforts to combat drug trafficking. Mexican President Claudia Sheinbaum announced that she would send 10,000 National Guard members to the border; and in a long post on X, Canadian Prime Minister Justin Trudeau said: “Canada is implementing our $1.3 billion border plan — reinforcing the border with new choppers, technology and personnel, enhanced coordination with our American partners, and increased resources to stop the flow of fentanyl. Nearly 10,000 frontline personnel are and will be working on protecting the border”. He went on to say: Canada is making new commitments to appoint a Fentanyl Czar, we will list cartels as terrorists, ensure 24/7 eyes on the border, launch a Canada- U.S. Joint Strike Force to combat organized crime, fentanyl and money laundering. I have also signed a new intelligence directive on organized crime and fentanyl and we will be backing it with $200 million”.

Here in the UK, Guinness maker Diageo has scrapped its sales targets as a consequence of Trump’s trade tariff threats. The firm imports tequila from Mexico and the Crown Royal whisky from Canada. Diageo CFO Nik Jhangiani has told journalists that if a 25% tariffs is imposed by the US on its neighbours, it would knock off £200m off the drinks’ firm’s gross profit. However, he thought the company could offset 40% of that through promotional pricing and shipping stock before tariffs were imposed. CEO Debra Crew said: “We will also continue to engage with the US administration on the broader impact that this will have on everyone supporting the US hospitality industry, including consumers, employees, distributors, restaurants, bars and other retail outlets”.

Council Tax rises of more than 5% loom for millions of households in England. Despite a Government-imposed cap on rises of 4.99%, Ministers have given the go-ahead to six areas to hike the levy beyond that figure. Deputy Prime Minister Angela Rayner is allowing Bradford Council to put up Council Tax by 10%; Newham, and Windsor and Maidenhead can put theirs up by 9%; and Birmingham, Somerset and Trafford can increase bills by 7.5%. Labour-run Birmingham is already in special measures after being declared effectively bankruptcy in 2023. Rayner said: "We recognise the importance of limited increases in helping to prevent these Councils falling further into financial distress – but we have been clear this must be balanced with the interests of taxpayers." The Government also refused permission for several councils to raise the tax above 4.99%, including Conservative-run Hampshire (which had asked for a 15% increase), Slough, and Cheshire East. Overall, Councils will be able to access an additional £69bn in funding this year, a 6.8% increase in cash terms compared to 2024-25, more than £2bn of which will come from direct grant funding from the Government, over and above Council Tax revenue.

Exclusive polling by City AM shows that Labour’s huge 174-MP strong Parliamentary majority would be wiped out if they faced a General Election today. The poll, by Freshwater Strategy, predicted the party would lose 100 seats, leaving them 11 seats short of an outright majority. More than 70% of voters said they lack confidence in the Chancellor’s fiscal plans, and 67% have no faith in her ability to manage the economy. More than 50% said they are expecting Rachel Reeves and Keir Starmer to break their manifesto pledge not to hike income tax, and over half also expect Corporation Tax and Employers National Insurance contributions to rise still further. 40% expect VAT to increase. Freshwater interviewed some 1,200 eligible UK voters between 31^st January and 2^nd February 2025. Yesterday, a separate poll by YouGov put Nigel Farage’s Reform party on 25%, a single point ahead of Labour, with the Conservative party in third place on 21%.

Science minister Sir Chris Bryant has defended his Government’s refusal to stand by the previous Conservative government’s investment pledge to help expand an AstraZeneca factory in Merseyside, telling the House of Commons that a "significant offer" of support to the firm had been offered, but that doing more "simply didn't add up for the taxpayer". The big pharma binned its planned £450m investment last week, blaming a shortfall in government funding. AstraZeneca's decision had been "deeply disappointing", Bryant added.

Construction activity outside London has slumped by 27% when compared to 2023, the latest data from Deloitte’s regional crane survey shows. The survey monitors construction in the Leeds, Belfast, Manchester and Birmingham city centres, and shows developers made a start on just 47 new projects in these cities last year. Meanwhile, the number of homes under construction across the four cities fell by 7% to 23,673, and no new office, retail, leisure or education projects were started. Zoe Davidson at Deloitte blamed Government building safety regulations for delayed project timelines, saying they are putting “extra strain” on the market. These regulations require inspection of buildings taller than 18 metres that have already gained planning consent, and more than 90 such projects are awaiting sign-off, according to Construction News. Only 11 out of 130 have passed the checks since 2023. Housebuilders also face a cladding tax on all new residential developments, on top of an existing 4% tax on annual profits exceeding £25m to fund fire safety defect repairs, all of which potentially threatens Housing Secretary Angela Rayner’s plan to speed up remediation work and build more homes. The Deloitte report does, however, also note that dedicated student accommodation under construction rose by 2% last year, to 8,664 spaces.

Mike Eakins, chief investment officer of the FTSE 100 pensions giant Phoenix, says that Britain’s pension wealth is being “squandered” because of market fragmentation and because fund managers have become “risk adverse”. Writing in City AM today, he says: “We have one of the highest levels of investable pension wealth, but this advantage is squandered by having it split up between thousands of arrangements”. “The diffuse nature of the market largely exists for historic reasons and the industry should not be afraid of change.” Merging the sector into bigger combined funds would allow them to “function in a more sophisticated manner”, compete with “the very biggest investors for growth opportunities and us[e] their scale to extract the best terms,” he added, as opposed to a “conservative” approach that he claims means funds are “missing out on higher returns available in private markets”. A more “dynamic investment approach” would boost savers’ pension pots and “unlock substantial capital for domestic projects,” he believes.

Human rights group Stop Uyghur Genocide (SUG) has threatened the Financial Conduct Authority (FCA) with legal action if it gives the go-ahead for a London Stock Exchange listing to Chinese-founded fast fashion firm Shein. SUG has accused Shein of using forced labour in some of its third-party manufacturing facilities, including in the Xinjiang region, where the Chinese government is accused of persecuting the Uyghur Muslim minority, producing evidence of “clear, identifiable links between cotton production in the Uyghur region and forced labour”. In a letter to FCA executives, lawyers for the campaign group said that Shein’s anticipated £50bn listing would be “irreconcilable with the FCA’s statutory duty of integrity, its principles and standards as well as the protection of investors”. It said it will seek a High Court injunction to prevent the listing, if approval is given. Meanwhile, Shein will be affected by President Trump’s move to scrap the so-called ‘de minimis exemption’ for small packages worth less than $800 (£645) that are shipped from China, Canada and Mexico to the US. Previously, this allowed retailers including Shein to avoid paying customs duties by shipping small orders directly to customers.

Speedy Hire had fallen nearly 29% by close yesterday after the London-listed tools and equipment rental firm as it warned full-year profit was set to be lower than expected due to the "widely-reported economic downturn"

Ann Kaplan Mulholland, the multi-millionaire Canadian businesswoman and Non-Dom has told the Telegraph she is reluctantly packing her bags for Milan before the Treasury snatches an “astronomical amount” of her £500m fortune. “I seriously don’t want to leave but we have no choice because of ‘Reckless’ Reeves,” she says, in reference to the Chancellor. “It upsets me as we love England, it’s our home.” Mulholland and her cosmetic surgeon husband, Stephen, do not, under the current Non-Dom scheme, pay UK taxes on their overseas income, but that is coming to an end for them and some 70,000 fellow foreign millionaires resident in the UK, many of whom are also fleeing the country before the April 2026 deadline for change. Reeves’ change to the system is “ill-thought-through and amateur,” and will “choke England for years to come,” Mulholland said. “If ‘Reckless’ had a brain, she would take a page out of Italy’s offer and realise she could stop the bleed by offering non-doms the option to pay a fee of £200,000 per year. If she did that, I’d be first in line to say I’m staying and here’s your cheque. But that’s not happening. Wealthy individuals are preparing to walk down the runways of Italy, Switzerland and Dubai where government concierges will greet them with open arms and wallets.”