Free trade deals for 'poorest countries' to be maintained post-Brexit


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Free trade deals with developing countries will continue post-Brexit, the government has said.

The UK will maintain an EU deal, which provides 48 countries with duty-free access to Britain for imports.

It means British firms do not pay import tariffs on goods bought from countries such as Bangladesh and Haiti.

International Trade Secretary Liam Fox said Brexit gave the country an opportunity “to step up our commitments to the rest of the world”.

He added: “Free and fair trade has been the greatest liberator of the world’s poor, and today’s announcement shows our commitment to helping developing countries grow their economies and reduce poverty through trade.”

The deal excludes arms and ammunitions.

The list of countries – which also includes Ethiopia, Sierra Leone, and Uganda – is based on the UN’s Least Developed Counties index.

Currently £19.2bn of goods are imported from the 48 countries, including 79% of the tea consumed in the Britain.

Some 45% of the UK’s textile and clothing imports, and 22% of its coffee, also come from the developing nations.

International Development Secretary Priti Patel said the renewed commitment would “help the world’s poorest people stand on their own two feet”.

She added: “Building a more prosperous world and supporting our own long-term economic security is firmly in all our interests‎.”

The government is also intending on exploring options to expand relationships with richer countries like Jamaica, Pakistan and Ghana, which currently enjoy a mixture of reduced tariffs or zero tariffs.

Dr Fox added it would result “in lower prices and greater choice for consumers”.



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Building society's account deadline axed


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A deadline for the closure of current accounts with the Norwich and Peterborough (N&P) has been cancelled, with 30% of customers still to receive letters explaining the move.

It was announced in January that the building society’s brand is to be abolished, some branches closed, and current accounts shut down.

The plan was for customers to move or close accounts by the end of August.

But its owner, the Yorkshire Building Society, now says there is no deadline.

The Yorkshire – the UK’s second biggest mutual – said that about 35% of the 100,000 customers affected had already closed their current account, switched to another bank, or was in the process of doing so.

It was staggering the flow of letters to affected customers to avoid a rush of inquiries, and has now written to 70% of those affected.

The remaining letters will be sent by the end of July.

‘Real shame’

The Yorkshire will close 28 N&P branches this year. The remaining branches will be rebranded as Yorkshire Building Society branches.

A spokeswoman for the Yorkshire said: “We are continuing to work closely with other financial providers in assisting customers to switch or close their account. We’re writing to customers with details of what they need to do next, and asking that customers complete the closure or switch of their account within six months of receiving their letter. We have not set a final date for closure.

“If a customer has not taken steps to close or switch their account within six months of receiving of their letter, we will work closely with the customer on a case-by-case basis to facilitate a switch or closure.”

In the meantime, no customers would be blocked from depositing money or conducting any normal banking transactions via their current account, she said.

The N&P is not part of the Current Account Switching Service so the process will be slower than could have been the case, taking about 12 days.

It was feared that some cash incentives to switch offered by rivals would not have applied, but many providers are now offering the perks to customers moving from the N&P.

Mike Regnier, chief executive of the Yorkshire Building Society, told BBC Radio 4’s Money Box earlier this year that it was a “real shame” that the accounts had to close. He said that too much investment would be required to keep the current accounts compliant with regulation if offered by the mutual. Instead it is to concentrate on savings and mortgage products.



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Big hitters


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The teams have been playing warm up matches, including one between England and Sri Lanka

The Women’s Cricket World Cup takes to fields across England this weekend, looking to bowl over youngsters and women, not to mention businesses, with their event.

As well as seeking to encourage more girls and boys to take up the sport, organisers also want more females to follow cricket, while convincing young sportswomen there is a worthwhile career for them in the game.

Ironically, for what is the most financially lucrative women’s world cup to date, making huge amounts of money from the event is not the main priority.

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Holders Australia will be chasing a record seventh title

And there is a lot of cash around the eight-team tournament – with record prize money of $2m (£1.57m), healthy ticket sales, and big name International Cricket Council (ICC) global sponsors such as Nissan, Emirates, Hublot and Moneygram backing the event.

Rather, it is hoped that the money being spent now on the 28-day, 31-match, tournament, will be a catalyst that piques the interest of potential commercial sponsors in both the UK and elsewhere.

‘Looking for relevance’

“What strikes me is that we have been presented with this huge potential for growth in so many areas, sporting and financial,” Clare Connor, head of England Women’s Cricket and a former national team captain, tells me.

“We have got a sport, cricket, that is looking for relevance. People are asking ‘how can we help take cricket into a new era?’

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Clare Connor holds a number of high profile roles in women’s cricket

“One way is to engage with young women and girls. We have to maximise these opportunities during the World Cup.”

Ms Connor, who is also chair of the women’s committee at cricket’s governing body the ICC, said that irrespective of who wins, the world cup offers a chance to grow the sport in lots of creative ways.

Soft ball programme

One way is through the ECB’s All Stars Cricket, aimed at providing children aged five to eight with a memorable first experience of the sport. The nationwide entry-level participation programme aims to get 50,000 girls and boys – and their families – excited by the game over the summer.

“We also have a soft ball initiative specifically for women.” says Ms Connor, with a number of festivals being held during the World Cup.

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The All Stars programme is aimed at young girls and boys

As well as boosting participation, getting more women to follow women’s cricket is a major goal.

“At the moment it is a fallacy to think women watch women’s cricket. More males than females are cricket fans,” the 40-year-old says.

“Cricket is not currently as relevant to women as it is to men, but the World Cup gives us an opportunity to change that.”

She said that the majority of tickets, some 80%, had been sold to fans of England Cricket, and that she expected a high majority of them to be to men.

‘Altered audiences’

“But work by our marketing team does show there is a growing interest in watching by women,” she adds. “That is why a lot of our marketing of the All Stars children’s programme is targeted at mums, we are looking to engage them in the whole experience.”

She said a new city-based eight-team Twenty20 tournament, due to start in 2020, was the ideal way to attract a new female audience.

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Half of the fans at the Women’s Big Bash in Australia are females

“We have been looking at Australia and the Women’s Big Bash, where 50% of spectators are women. They have totally altered the make up of their audience, and that is something we would look to emulate.”

The tournament was brought forward so more matches sat in school term time. Just less than half of the matches are taking place on weekdays which presents an opportunity for local schools to witness tournament action live.

Meanwhile, Ms Connor says tickets for World Cup games have been priced to allow an affordable family day out. England’s opening game against India is sold out, and 15,000 tickets have been sold for the final at Lord’s.


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England cricket player Anya Shrubsole on forging a cricket career

The 25-year-old is the daughter of Ian Shrubsole, a former Minor Counties cricketer in the 1990s. At 13 she was the first girl to join the Somerset Academy.

“I remember from the age of three or four my dad playing, and going out onto the pitch at the interval, throwing a ball around. That is my first memory of cricket. I then really got into it when I was at school.

“Back then, when I was growing up and coming through as a player there was an element of financial reward, but not enough to live off it. The money you received wasn’t enough, you couldn’t have afforded a mortgage.

“However, that wasn’t something that was a real issue for me, I wanted to be as good as I could be.

“But I graduated at the same time that cricket turned professional. So I have never had the worry of trying to find a job alongside playing cricket.

“In means that in terms of staying in cricket, it is now a viable career option for young women whereas previously it wasn’t. You make a living out of women’s cricket, like you can with women’s football. Before that you would have needed a separate job alongside.

“It is an immense honour to represent your country, One of the strengths of women’s sport is that they are playing for the real love of the game.

“I think we are role models for youngsters. I am guilty sometimes of not thinking that I am, but anyone who plays international sport is a role model.

“The game is still in quite a developmental stage, and I am hopeful we will have a young audience growing up alongside the sport.”


‘Challenger sport’

On ticket pricing, the ICC worked with a specialist agency to look at various ticket prices both at the venues (so including men’s and women’s cricket domestic and international), cricket as a whole, and also looked at other women’s sports events in this country.

“We are not going to make a great deal of money out of it,” says Ms Connor.

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Clare Connor represented England from 1995 until retiring from international cricket in 2006

But she adds: “We are hoping that eventually the event becomes a commercial money spinner.

“For example, we hope that companies see there is an opportunity there to get involved in women’s cricket, like Kia did a few years ago, when they became the official car of the England women’s team.

“They saw the women’s game as a real area of growth. As a challenger brand they were keen to work with women’s cricket which they saw as a challenger sport.”

‘Transformed’

Other positives for the women’s game are the widespread media coverage being given to the World Cup. In addition to the scheduled 10 fixtures to be broadcast live on TV, the remaining 21 World Cup matches will be streamed live.

There will be radio commentary and video highlights on BBC radio and sport website.

Meanwhile, the ICC has committed to equal prize money for women and men’s cricket by 2032.

“There will be a strategic plan to ensure that the game can deliver equal prize money in 15 years time,” says Ms Connor.

“The women’s game has only been under the ICC’s auspices since 2005. If you think of the developments since then, it is a sport transformed. The World Cup will continue that transformation.”



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Tesco is raising store staff pay by 10.5% over two years


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Hourly pay rates for Tesco store staff will rise by 10.5% over the next two years, the supermarket has said.

But pay remains lower than at Aldi and Lidl and overtime pay on Sundays and Bank Holidays is being cut.

Currently Tesco workers are paid £7.62 an hour, which will rise to £8.42 an hour by November 2018.

The pay rise will put Tesco workers’ pay above the £7.90 level that the National Living Wage is expected to reach by 2018.

The National Living Wage is the effective minimum wage for adults aged 25 and over, and is currently £7.50.

Those under the age of 25 are entitled to a lower minimum wage rate, whilst workers in London receive a premium.

Statutory minimum pay rates will continue to rise until at least 2020, according to recent government Budgets, and companies are planning for those changes, as well as striving to remain competitive with rivals in order to recruit and retain staff.

Wage growth in the UK has been slow in recent years, but inflation has risen and other supermarkets have increased the wages they pay.

Improved maternity pay

Aldi recently announced a rise in hourly pay to £8.53 an hour; Lidl’s website says it pays store staff £8.45 an hour.

Tesco said it would increase hourly pay in three stages: to £8.02 in November 2017, then to £8.18 in July 2018 and to £8.42 in November 2018.

“This reward package sees our biggest investment in store pay for a decade, and gives colleagues a sustainable pay deal that rewards them for everything they do, while allowing us to also attract new talent,” said Tesco UK chief executive, Matt Davies.

The retailer said maternity pay terms had also been improved. But extra pay for Sundays and bank holidays will be reduced from time-and-a-half to time-and-a-quarter after July 2018.

“This is designed to meet the government legislative requirement around the minimum wage.

“As expected, most of the businesses who have had to face up to this rise have had to reduce premiums and other perks that employees benefitted from in order to meet the core wage rises,” said retail analyst Steve Dresser.



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EU prepares to move two agencies from London


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Both agencies are currently headquartered in Canary Wharf in London

EU leaders have officially launched the competition between member states to decide which will host two London-based EU agencies, responsible for medicines and banking.

The relocation must take place by the Brexit deadline – 30 March 2019.

Some countries are bidding to host both the European Medicines Agency (EMA) and European Banking Authority (EBA).

It means hundreds of jobs moving from London, along with significant revenue from hotel stays and conferences.

The deciding vote will take place in November.

The EU 27 agreed on the selection process on Thursday night, after UK Prime Minister Theresa May had left the Brussels summit.

The 27 are determined that the UK will pay the relocation bill, as Brexit was a UK decision.

The EMA’s total number of staff in 2015 was 890, while the EBA’s was 189. Both are headquartered in Canary Wharf.

The EMA had 36,000 visitors in 2015, and 30,000 hotel nights were booked, the European Council said.


What do the agencies do?

EMA

  • Monitors the safety and quality of medicines EU-wide and issues scientific advice
  • Provides a single route for evaluating medicines, avoiding duplication by member states
  • Helps innovation by collaborating with medicine manufacturers

EBA

  • Works to harmonise European banking rules and supervisory practices
  • Assesses risks and vulnerabilities in EU banking sector
  • Mediates in cross-border disputes between financial authorities

The national rivalry over hosting the agencies will be closely watched. It could reveal some wider tensions over Brexit, so it will be an early test of EU unity in the tough Brexit negotiations.

In 2001 Italy’s then Prime Minister Silvio Berlusconi mocked Finland’s bid to host the European Food Safety Authority (EFSA).

“There is absolutely no comparison between culatello (speciality ham) from Parma and smoked reindeer,” Mr Berlusconi was quoted as saying.

Italy’s bid beat Finland’s, and the EFSA opened in Parma in 2005.

First the European Commission will assess the competing bids and make its recommendations.

In November each of the EU foreign ministers will vote in order of preference – three points for the preferred bid, two points for the second-favourite and one point for the third.

Accessibility and efficient infrastructure are the top two agreed criteria. But the EU also wants the new hosts to have good “European-oriented” schooling and job opportunities for the families of agency staff.

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Vienna is among the cities vying to host the EBA and its employees

Germany’s Spiegel news website joked that the voting would be rather like the Eurovision Song Contest.

“That’s why the Germans fear equally wretched results,” Spiegel said – even though Frankfurt, as HQ of the European Central Bank, would be a logical host for the EBA.

A flavour of this new EU “beauty contest” was provided by Austria.

Austrian Foreign Minister Sebastian Kurz said his country “is already a terrific location for many international organisations.

“We have wonderful general conditions in Vienna, and that’s why I consider that we are a very attractive location.”

The EU is keen to locate some of its agencies in the newer member states of Central and Eastern Europe – it has stated that as an aim.

But their rejection of the EU asylum policy – notably refusing to take in refugees currently in Italy and Greece – may count against them.



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Troubled Toshiba flags deeper losses


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Ailing electronics giant Toshiba has said its losses for 2016 may be greater than it had previously forecast.

It now predicts a net loss of 995bn yen (£7bn) for the year to March, up from its earlier estimate of 950bn yen.

The firm was demoted to the second tier of the Tokyo Exchange after confirming its liabilities outweighed its assets.

It also got regulatory approval to delay filing its annual earnings again, this time until 10 August, after a previous deadline extension to 30 June.

Failure to gain an extension would have put the troubled company’s stock exchange listing in further jeopardy.

Chip sale

In April, Toshiba said its future may be in doubt after facing a series of difficulties.

An accounting scandal that was uncovered in 2015 led to the resignation of the chief executive and several senior managers. The company was found to have inflated the previous seven years’ profits by $1.2bn.

The firm was dealt another blow in January when it became clear its US nuclear unit, Westinghouse, was in financial trouble.

Toshibas’s dire financial position has forced it to try to sell off its highly prized chip unit.

The company has named a consortium of Bain Capital and Japanese government investors as the preferred bidder for the business

But US-based Western Digital, which jointly runs Toshiba’s main chip operations in Japan, has filed a request with the International Court of Arbitration to stop the sale going ahead.

Toshiba is the world’s second-largest chip manufacturer. Its products are used in data centres and consumer goods worldwide, including iPhones and iPads.



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FTSE 100 slides as pound rises


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The pound climbed back above $1.27 but the FTSE 100 share index was on track for its third week of losses in a row.

Shortly after midday the FTSE 100 was down 29.88 points at 7,409.41.

Meanwhile sterling rose 0.4% against the dollar to $1.2732, and climbed 0.2% against the euro to 1.1401 euros.

The FTSE 100 often falls when the pound rises because many firms in the index operate abroad. A stronger pound means overseas earnings are worth less when changed back into sterling.

Comments from brokers were behind some of the bigger share movements. BAE Systems fell 1.8% after JP Morgan cut its rating on the company to “neutral”.

Broadcasting company ITV was the biggest riser in the FTSE 100, up 2.3%, as Morgan Stanley raised its rating to “overweight”.

In the FTSE 250, shares in Domino’s Pizza fell 3.5% after analysts at Berenberg cut their rating on the company to “hold”.



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ECB bids for more euro clearing oversight


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London is the world leader for clearing all types of currency-denominated derivatives

The European Central Bank has put forward a proposal to boost its oversight over euro clearing.

The legal amendment would give it a “significantly enhanced” role in regulating the lucrative market.

London currently processes most of the trade in this financial sector, providing thousands of jobs.

The ECB’s proposal comes shortly after the European Commission published a draft law to give it the power to move euro clearing business out of London.

Clearing is where a third party organisation acts as a middleman for buyers and sellers of financial contracts tied to the underlying value of a share, index, currency or bond.

Trillions of euros are handled through clearing houses every year, mostly through London.

The ECB said the amendment would give it “clear legal competence” in the area of central clearing, which is currently dominated by London firms.

Under the proposal, the ECB and its national central banks would monitor risks that could affect monetary policy, the operation of payment systems and the stability of the euro.

Daniel Hodson of the Financial Services Negotiation Forum told the BBC that at the moment the ECB did not have sovereignty over euro clearing in London, as its UK regulator – the Bank of England – is responsible.

However, there are “substantial” arrangements in place with the ECB that are “very similar” to those in place with US regulators for dollar clearing, he said.

“There is no economic reason for changing this well-developed and thought out established framework, adapted as appropriate post-Brexit,” he said.

“There is a strong argument that to try to move substantial amounts of London based euro clearing business into the eurozone would actually create more systemic risk than it would offset,” he added.

The move comes after the European Commission put forward reforms that would impose stricter supervision of the euro derivatives market and could force operators to leave London as a result of Brexit.

At the moment London is the world leader for clearing all types of currency-denominated derivatives including the euro.



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Watchdog clamps down on online gambling


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The competition regulator is to take action against some online gambling companies which it suspects of breaking consumer law.

The Competition and Markets Authority (CMA) said some punters did not get the deal they expected from sign-up promotions offering cash bonuses to attract them to gaming websites.

The CMA also said the firms were “unfairly holding onto people’s money”.

Online gambling companies should “play fair”, said the CMA.

Nisha Arora, CMA senior director for consumer enforcement said: “New customers are being enticed by tempting promotions only to find the dice are loaded against them.

“And players can find a whole host of hurdles in their way when they want to withdraw their money.”

The CMA launched its investigation into the gambling sector in October 2016. It has since heard from about 800 “unhappy” customers and has “demanded companies answer questions about how they operate, and closely examined the play on a range of websites”.

As a result it has identified “a number of operators engaging in practices likely to be breaking consumer law”, which is why it is taking enforcement action.

The online gambling sector has grown by about 150% since 2009 and is worth £4.5bn. The CMA said more than 6.5 million people regularly use the sites.



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Facebook launches initiative to fight online hate speech


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Facebook says it will support and train NGOs to spot and respond to hate speech and extremism

Facebook is launching a UK initiative to train and fund local organisations to combat extremism and hate speech.

It comes a week after the social network announced steps of its own to remove terrorist-related content from its site.

The UK Online Civil Courage Initiative’s initial partners include Imams Online and the Jo Cox Foundation.

Facebook has faced criticism for being slow to react to terrorist propaganda on its platforms.

“The recent terror attacks in London and Manchester – like violence anywhere – are absolutely heartbreaking,” said Facebook’s chief operating officer, Sheryl Sandberg.

“No-one should have to live in fear of terrorism – and we all have a part to play in stopping violent extremism from spreading.

“We know we have more to do – but through our platform, our partners and our community we will continue to learn to keep violence and extremism off Facebook.”

Increasing pressure

In recent months, governments across Europe have been pushing for technology companies to take more action to prevent online platforms from being used to spread extremist propaganda.

In particular, security services have criticised Facebook, Twitter and Google for relying too much on other people to report inappropriate content, rather than spotting it themselves.

In April, Germany passed a bill to fine social networks up to €50m (£44m) if they failed to give users the option to report hate speech and fake news, or if they refused to remove illegal content flagged as either images of child sexual abuse or inciting terrorism.

Following the London Bridge terror attack, UK PM Theresa May announced that new international agreements needed to be introduced to regulate the internet in order to “deprive the extremists of their safe spaces online”.

And last week in Paris, Mrs May and French President Emmanuel Macron launched a joint campaign to look at how they could make the internet safe, including making companies legally liable if they refused to remove certain content.

Other efforts

Similar initiatives to counter hate speech were launched in Germany in January 2016 and in France in March 2017.

They have held training workshops with more than 100 anti-hate and anti-extremism organisations across Europe, and reached 3.5 million people online through its Facebook page.

In the UK, people are being encouraged to visit the UK OCCI Facebook page, to share stories, content and ideas, and use the hashtag #civilcourage.

Brendan Cox, the widower of murdered MP Jo Cox and the founder of the Jo Cox Foundation, has welcomed the move.

“This is a valuable and much needed initiative from Facebook in helping to tackle extremism,” he said.

“Anything that helps push the extremists even further to the margins is greatly welcome. Social media platforms have a particular responsibility to address hate speech that has too often been allowed to flourish online.

“It is critical that efforts are taken by all online service providers and social networks to bring our communities closer together and to further crack down on those that spread violence and hatred online.”



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Hinkley Point deal 'risky and expensive'


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Artist’s impression of Hinkley Point C building proposals

UK government plans for a new £18bn nuclear power station have come under fire from public auditors, who call it “a risky and expensive project”.

The case for the Hinkley Point C plant in Somerset was “marginal” and the deal was “not value for money”, according to the National Audit Office (NAO).

The NAO said the government had not sufficiently considered the costs and risks for consumers.

The government said building the plant was an “important strategic decision”.

The report comes nine months after the government granted final approval for the project, which is being financed by the French and Chinese governments.

State-controlled French energy firm EDF is funding two-thirds of the project, which will create more than 25,000 jobs, with China investing the remaining £6bn.

Critics of the deal have warned of escalating costs and the implications of allowing nuclear power plants to be built in the UK by foreign governments.

Case ‘uncertain’

The NAO’s report centred on the role of the Department for Business, Energy and Industrial Strategy (BEIS) in finalising the deal in 2016.

At the time, said the NAO, the department’s own value-for-money tests showed “the economic case for Hinkley Point C was marginal and subject to significant uncertainty”.

“But the department’s capacity to take alternative approaches to the deal were limited after it had agreed terms,” the NAO added.

“The government has increasingly emphasised Hinkley Point C’s unquantified strategic benefits, but it has little control over these and no plan yet in place to realise them.”

It added that consumers were “locked in” to years of paying for the plant.

In response to the report, a BEIS spokesperson said building the plant was “an important strategic decision to ensure that nuclear is part of a diverse energy mix”.

The department said the project would provide “clean, reliable electricity powering six million homes and creating more than 26,000 jobs and apprenticeships in the process”.

EDF Energy said the plant “remains good value for consumers compared with alternative choices”.

The firm added: “Consumers won’t pay a penny until the power station is operating and it is EDF Energy and [China’s] CGN who will take the risk and responsibility of delivering it.

“The project is having a major impact on the UK’s industrial capacity, jobs and skills. Relaunching the UK nuclear new build industry at Hinkley Point C will enable costs for future projects, in particular Sizewell C, to be lower.”

The Nuclear Industry Association (NIA) said the report showed that the plant was “competitive with other low-carbon projects” and that “alternatives would cost more”.

However, NIA chief executive Tom Greatrex added: “The NAO analysis of the strike price also highlights that using a different financing structure could have resulted in a lower strike price.

“That is something government should reflect on as other new nuclear projects advance.”



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One year on


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Before last year’s Brexit vote, there were warnings from many economists that the UK would suffer a catastrophic economic shock and be catapulted into recession by a Leave vote.

As it turned out, those predictions were a touch pessimistic.

But one year on, what do economists and businesses think of the aftermath of the vote? And what do they think the future holds?

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‘Wheels coming off’

David Owen, chief European financial economist for Jefferies, still thinks the UK could be in for a rough ride.

“For six months or so after the Brexit vote, the UK economy as a whole also held up surprisingly well, helped by the significant monetary easing announced by the Bank of England last August and the move down in the currency,” he says.

“But recent weeks have seen growing signs of the wheels coming off the UK recovery, with real incomes squeezed by the decline seen in real wages.”

UK wage growth slowed down this year and started to lag behind inflation in May. Prices are rising in the shops faster than people’s wages are going up, meaning the amount people have to spend is going down in real terms.

In the future, “much will depend on what deal the UK ultimately manages to strike with the rest of the EU, but with Brexit discussions now commencing, uncertainty and political risk will dominate discussion,” he adds.

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Slow down

Last year, not all economists thought the shock to the economy would be so profound. Martin Beck of Oxford Economics said then that although the Brexit vote would hit the UK, it would avoid recession.

Since a majority of voters chose to leave the EU, it was “not obvious” that business and consumers would cut back on spending immediately, he says.

However, he now believes that UK growth will indeed slow down, partly because of “uncertainty over Brexit negotiations and uncertainty as to what the outcome will be”.

After the Brexit vote, the pound dropped sharply against the euro. It is still trading about 14% down against the dollar.

As a result of that devaluation, UK consumers are starting to be squeezed by price inflation.

However, exporters are feeling the double benefit of a weaker pound and no change to tariffs to the EU at the moment, Mr Beck says.

What happens next to the UK economy “depends on the deal” that the UK government manages to come up with.

Research done by Oxford Economics “suggests a long-run hit to the economy” with a gradual cumulative effect. By 2030, the UK will have missed out on 3% to 4% of growth, he adds.

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Brexit bonanza?

Last year, some economists were positively gung-ho for Brexit.

Prof Patrick Minford of Cardiff University is a member of Economists for Free Trade, formerly known as Economists for Brexit.

Prof Minford says that “the consensus was for a recession”, but “we thought it [the UK economy] would be pretty much unaffected”.

However, he says Economists for Brexit “didn’t get the scale of the devaluation right” for sterling.

They thought devaluation would be about 6% and it turned out to be more like 15%. However, this isn’t necessarily a bad thing, he says.

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Trading places

Having a devalued pound boosts demand for exports, Prof Minford says.

Businesses invest more money because they can sell more easily abroad.

And more expensive foreign goods encourage consumers to buy British, giving an extra push for business investment, he adds.

The devaluation is “likely to remain for quite some time” because of the length of the Brexit negotiations.

He says that the eventual agreement is likely to be a compromise between soft and hard Brexit.

If negotiations are derailed, this may be positive for stock market sentiment, as the UK could move towards free trade agreements faster.

But the economy will probably move towards having more of an emphasis on free trade gradually, he adds.

Mr Beck of Oxford Economics also says that being outside the customs union with the EU may bring benefits.

Trade with the EU may not be as important as building trade links with rapidly growing large economies such as China and India, he says.

Even before Brexit, exports to the EU had been falling relative to other markets.

China and India are “growing very quickly”, whereas European countries are wealthy and so are growing more slowly as a market, Mr Beck says.

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Boom, bust, boom?

Some economists have a completely different take on where they think the economy is heading.

Douglas McWilliams, deputy chairman of the Centre for Economics and Business Research, said after the Brexit vote that he expected a boom.

But now there will be a hit to the UK economy due to uncertainty and a fall in immigration.

The creative industries fuel a large chunk of the UK economy, he says, and without immigrants to stimulate new ways of thinking, business will be hobbled.

“The real benefit [to immigration] is that skill bottlenecks are solved,” he says.

Eventually, the UK will “change what we make and sell” in the longer term. But he expects negative effects on the economy to outweigh positive effects until 2030.

Business view

Business lobby group the CBI says that growth in the UK economy will “shift down a gear” in the short term as household spending slows down.

“The less likely a Brexit deal starts to look, the harder it will be for firms to recruit and retain talent as well as push the button on big investment decisions. We must get Brexit right,” says CBI director-general Carolyn Fairbairn.

Big firms such as Rolls Royce have said they want as little change as possible after Brexit.

And car-makers are worried about a trade “cliff edge” if tariffs are suddenly imposed on EU imports and exports.

People power

Finally, what do people in the UK think about Brexit?

Joe Twyman from pollsters YouGov says that in the main, they haven’t changed their mind from how they voted last year.

“Nothing has changed, because nothing has changed,” he says. “Negotiations have just started.”

One interesting twist is that 26% of the population that voted Remain believe the UK should go ahead with Brexit, because that’s how the majority voted, he says.

However, he adds that the political situation is “very fluid”, and depending on how the negotiations go, those opinions could easily shift.



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'I lost my eye'


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Francis Ahiale

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When Francis Ahiale lost his left eye in a work accident, an insurance payout helped him cope

About two billion people have no insurance, but micro-payments via mobile phone are helping give low-income households the cover they need.

When Francis Ahiale was trying to remove a car tyre from its rim, the metal tool he was using flew up into his eye. In great pain and bleeding profusely, he went to hospital for treatment, but unfortunately lost his left eye.

“I felt really bad,” says Mr Ahiale, 37, from Adenta, Ghana. “But I came to realise that accidents happen, especially in my line of work.

“Ever since the accident I can’t work as well as I did before – I need help, so I’m suffering financially.”

The hospital treatment cost him 1,500 Ghanaian cedis – about £270 – which he could only pay after borrowing money from friends.

That debt would have made his life even harder had he not taken out a new type of personal accident insurance paid for in micro-instalments over his mobile phone.

The total monthly cost of the policy was about £1.

After sending a doctor’s report to the insurance company’s office in Accra to verify the claim, Mr Ahiale received a payout of about £450.

“They paid up straight away,” he says. “I was very happy because I wasn’t expecting this type of money – it meant I could pay off my debt.”

Mr Ahiale is just one of millions of lower-income people across Africa and the rest of the developing world increasingly benefiting from affordable insurance paid for by mobile.

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Bima

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Bima’s Gustaf Agartson believes to sell insurance you need people as much as technology

“It’s very good that we can now buy insurance,” says Mr Ahiale. “My friends and neighbours are coming to accept that it is affordable and helpful.”

Vodafone and Safaricom’s M-Pesa blazed a trail in mobile-to-mobile payments and banking services in Kenya, but for a long time in developing economies insurance seemed like the Cinderella of financial services.

“When you started to look across emerging markets, mobile penetration was about 70%, but insurance penetration was only about 3%,” explains Gustav Agartson, chief executive of Bima Insurance, the Swedish firm that insured Mr Ahiale.

“Insurers in the developing world behaved much like insurers in the developed world, linking insurance with bank accounts.

“But many people in emerging markets don’t have bank accounts.”

Bima developed a platform to allow low-income consumers to pay for insurance from their mobile phone credit. Subscribers make small daily payments and can stop the contract whenever they like.

Partnerships with local telecoms providers were crucial to this business model.

More Technology of Business

Six years later and Bima has 30 million subscribers in 16 countries in Africa, Asia and Latin America, with 90% of people buying insurance for the first time, says Mr Agartson. Most of the firm’s customers live on less than $10 (£8) a day.

The range of policies includes life, personal accident, and hospitalisation, and the firm has plans to expand to include education and income protection.

M-Pesa launched a health insurance premium collection platform in 2014, and telecoms providers, such as Africa’s largest player MTN, Tanzania’s Zantel, and Etisalat in the United Arab Emirates, have been expanding their mobile digital wallet products to include insurance in recent years.

Meanwhile, another specialist mobile insurance provider, MicroEnsure, says it has registered nearly 55 million customers across 20 countries, offering a growing range of insurance products, including cover against political violence and crop failure.

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MicroEnsure

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MicroEnsure develops low-cost insurance products in consultation with local communities

It has paid out more than $30m (£24m) in claims so far.

“Now customers expect their mobile operator to offer a digital wallet – mobile person to person payments have become the norm – so to differentiate themselves operators are having to offer additional services, such as insurance,” explains Jack Kent, mobile analyst at research consultancy IHS Markit.

While mobile platforms have helped automate premium collections, insurance is still a product that needs to be sold by humans, argues Mr Agartson, especially in countries where it is little understood.

“Even if everything is digitalised – applications, payments, claims – it’s not enough, because people aren’t aware of how insurance works,” he says.

“People need to be educated… so we have 3,500 people in call centres and out in the streets.”

As profit margins are small on such low-cost policies, the company needs to sell large volumes to make a profit, he says. But the sales agents also have to make sure customers can afford to keep up the payments.

“Having a network of agents that can also cash in and cash out money is useful for operators to have in such markets,” says Mr Kent.

As more people buy smartphones – take up is now 30% to 40% in developing economies – there are opportunities to offer more interactive and targeted services, informed by analysis of the usage data such phones provide.

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Getty Images

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Analysing how people used their phones is helping insurers assess risk

“Companies are applying analytics and machine learning to all this data to help operators assess the creditworthiness of prospective customers,” says Mr Kent.

By analysing how people use their phones, what they search for, what apps they use, and how financially literate they are, operators can decide what types of products would be most suitable for them and how much risk such customers represent.

Tech companies such as Juvo and Nuance have been moving into this space, offering analytics services to mobile operators.

But the uptake of insurance by mobile could be further accelerated once electronic signatures are more widely accepted.

Some countries still require physical signatures; others, like South Africa, have allowed digital signatures for several years.

Back in Ghana, Francis Aziale is one of 1.5 million people who now buy mobile insurance out of a population of about 28 million.

There is still plenty of room for growth, accelerated by technological innovation.



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Fed: US banks have money for crisis


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ANDREW CABALLERO-REYNOLDS/AFP/Getty

The 34 largest banks in the US have money on hand to withstand a severe recession, the US central bank said on Thursday.

The finding comes from an annual “stress test” conducted by the Federal Reserve.

The tests were put in place after the financial crisis to strengthen financial capacity in the event of a downturn.

Banks have been pushing to relax those rules.

Some said Thursday’s results could make it easier to convince policymakers to do so.

“We see today’s … stress test results as a positive for Trump administration efforts to deregulate the banks,” Jaret Seiberg, a policy analyst with Cowen & Co, told Reuters.

The Federal Reserve tested to see how banks with $50bn (£39.4bn) or more would respond in the event of a global recession, if unemployment increased to 10% and property values declined.

That would trigger combined losses of nearly $500bn over more than two years – including $383bn from loans – but the firms have enough of a cushion to handle such a blow, the Federal Reserve said.

Since 2009, the 34 firms have added more than $750bn in common equity capital, the Federal Reserve said.

Jerome H Powell, a governor of the Federal Reserve who has urged some regulatory reform, said the tests show that “even during a severe recession, our large banks would remain well capitalised”.

“This would allow them to lend throughout the economic cycle and support households and businesses when times are tough,” he said.

The firms reviewed included Bank of America, JP Morgan Chase and Wells Fargo.

A second, more closely watched component is due next week.



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Better prospects


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Media caption“Belt and Road has been great for my business,” says Huang Jie

China’s Belt and Road initiative is ploughing through central Asia. The plan, which aims to expand trade links between Asia, Africa, Europe and beyond, was unveiled in 2013. What impact has China’s grand plan had so far in Kazakhstan? I went to Almaty – the financial capital – to find out.

The lyrical strains of Almaty’s latest pop song reverberates through the city’s main Chinese market, lending a distinctly Kazakh feel to what looks like a scene that could easily be from Beijing or Shanghai.

Inside, signs in both Mandarin and Kazakh point out directions in the warren-like maze.

It’s here that I meet Huang Jie, a jovial bear of a woman. She’s been running a convenience store in this market for 15 years, selling everything from hairbrushes to soy sauce.

She came to Almaty from China to take part in an ice-skating competition, but then stayed on because of the opportunities here.

“They had almost no consumer items [when I came here in 1991],” she explained.

“So we brought cosmetics, stereo sets, kids clothes, shoes… then we moved on to food, pots, kitchen utensils. And then home furniture, and now even gym equipment. We built it up step by step.”

And it’s been a remarkable success.

‘Great for my business’

All of the products in Ms Huang’s shop and in the Chinese market are from China. Most of the time she says she serves a mixture of Russian and Kazakh customers, and has learned both languages to help her sales – but increasingly she and other vendors like her in this market have been getting customers from China, thanks to the One Belt One Road initiative.

“Belt and Road has been great for my business,” Ms Huang told me.

“Huge numbers of Chinese people have surged into the country to work on construction projects and build infrastructure, and they need my foodstuffs.

“When Chinese companies went to Astana to build the light railway system, a few thousand people came in. When they need to build a cement factory, there’ll be another few thousand. And they cannot do without food.”

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Some in Kazakhstan are suspicious of Chinese investment

Kazakhstan is sometimes euphemistically called the “buckle” in China’s Belt and Road vision. It’s a pivotal part of the plan.

Beijing is setting up dry ports along the borders of this land-locked country, Chinese banks have lent money to Kazakhstan and Chinese companies have been snapping up stakes in Kazakh firms.

All of this comes at a price. What does China want? Access to Kazakhstan’s mineral resources for one thing. It is blessed with huge oil and gas deposits, and the Chinese are looking for a way to secure their energy needs in the future.

The investment has already yielded some very significant gains for the local Chinese business community in Almaty.

Bai Hong is chief executive of Talap Munai Services, a mining consultancy based in Almaty.

He started the business more than a decade ago after moving from China’s Liaoning province. Now it does business deals worth US$200m (£157m) a year. Thanks to China’s Belt and Road, he only sees that growing.

“It’s already been beneficial to us,” he said, whilst showing me around his new office.

“Now when we buy substances from China. Thanks to the Belt and Road initiative, the process is much faster. In the past we would need 40 to 50 days to bring just one truckload of substances here, now we can get it in 10-15 days.

“Kazakhstan has given us many preferential policies, like speeding up investment approvals and other frameworks as part of this agreement.”

But with that success, has come some suspicion.

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Demonstrations are rare in Kazakhstan, where President Nazarbayev has ruled since 1989

Last year, massive protests took place across the country against a controversial land reform bill – unusual in a nation where any sort of demonstration is quickly shut down or punished.

Most of the people protesting were worried that the new law would end up benefiting the Chinese more than the locals, and in the end it was shelved.

“The general population has a suspicion of Chinese investment,” Kassymkhan Kapparov, director of the Bureau for Economic Research of Kazakhstan told me.

“They always think there’s some strings attached to it. With the recent land reform projects, the main population were suspicious of the Chinese companies buying the land.

“The agricultural sector needs land reform but the public perception of the Chinese threat stopped the government from doing this reform.”

The man in charge of Kazakhstan, Nursultan Nazarbayev, has run things here since 1989. The climbdown on the land reform bill was highly unusual for him, given dissent isn’t tolerated in Kazakhstan.

But it may be a sign that he’s trying to manage the growing public mistrust of the Chinese – a partnership he’s cultivated and nurtured.

“The official point of view is full of beautiful statements: China is our good neighbour, our good partner, China is our future,” Dosym Satpayev, director of the Risk Assessment Group told me.

“But… the ordinary people have a lot of different [opinions] about China because traditionally inside Kazakh society there are a lot of fears about China.”

Despite that public perception though, China is still an increasingly important influence here.

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Chinese language student Alma says knowing Chinese will boost her employment prospects

I visited a Chinese-language school in Almaty where I saw Kazakhs of all ages – some as young as 11-years-old – arming themselves with the language they see as their ticket to a better future.

Nurzhan Baitemirov, chief executive of the East West Education Group which owns the language school, started with just one outlet back in 2007. He now runs 17 around the country and plans to open dozens more in the next few years.

“The Chinese culture and language will help Kazakhstan develop into a more sophisticated and powerful economy,” he told me as he showed me around his school. “That’s why our students come here.”

Currently his schools teach three thousand Kazakhs across the country, but that number is expected to grow.

“I know English, and Russian, but everyone knows those languages,” Alma, a student here tells me. “But if I know Chinese, a global language, then an employer will look at me twice and think ‘hey, that’s a good candidate!'”

Whatever the reservations, it’s clear that for most Kazakhs, this new relationship with China is unlikely to change anytime soon. Kazakhstan’s Chinese dreams are just beginning.



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New railway connection to London Luton Airport approved


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London Luton Airport

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The new rail link will connect the existing Luton Airport Parkway station to the terminal building

London Luton Airport is to get a new railway station so that trains can run directly to the terminal.

A 1.4-mile (2.2km) rail line will be built to the existing Luton Airport Parkway station, replacing the current bus shuttle service.

The £200m plans have been approved by Luton Borough Council and the station is due to open by the end of 2020.

It is hoped that passengers will be able to travel between the airport and London in under half an hour.

Current journeys from London to the parkway station take at least 20 minutes with passengers then having to wait for a shuttle bus which takes at least a further ten minutes, traffic permitting.

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London Luton Airport

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Trains on the new line will be automated and run 24 hours a day

It is part of a major redevelopment of the airport which also includes improvements to surrounding roads and layout of the terminal.

London Luton is the fifth-busiest airport in the UK, handling 14.6m passengers last year, and the airport is predicting that will increase to 18m by 2020.

Labour Cllr Dave Taylor, chair of planning at Luton Borough Council, said: “It’s an exciting development which will enhance the passenger experience at Luton.

“It was approved by all three parties on the council, unanimously, because the airport is a success story for the town and this improves the accessibility to it.”



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Pesto excluded from liquid ban by Italian airport


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Getty Images

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Pesto-loving tourists at Genoa airport are happy to pay to keep their precious jars

In an era of high-security air travel, many a passenger has fallen foul of the rules banning liquids on planes.

But now an Italian airport has decided to waive the 100ml maximum limit – as long as the liquid is pesto.

More than 500 jars have made it through since Genoa’s Cristoforo Colombo airport launched the “Il pesto è buono” (Pesto is good) scheme on 1 June.

The cost? A donation to Flying Angels, which flies sick children abroad for treatment.

Pesto – a popular pasta sauce made with basil, cheese, and pine nuts – is a local speciality in Genoa.

The airport said the brainwave arose after staff were faced with “hundreds of jars that were seized in airport security checks”.

Tourists with pesto jars of up to 500g can ask for a special sticker in exchange for a €0.50 (£0.44; $0.55) charity donation – although the airport says many are donating more.

The pesto is then scanned in a special x-ray machine before proceeding onto the plane as hand luggage.

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Twitter/GenovAeroporto

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The airport’s Twitter account has been promoting its new scheme

Foreigners are not the only ones grateful for the pesto-preserving initiative. According to the airport, Genoese travelling out of Italy are delighted to find they can take the much-loved foodstuff along.

There are some rules, however: Passengers can take either one 500g jar, or two jars up to 250g. They must be flying directly from Genoa.

And crucially, the pesto must be Genovese.


The magical mixture – what’s in pesto?

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Joe Kohen/Getty Images

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The basil-based sauce is a local speciality in Genoa, northern Italy

  • Genoese basil
  • Ligurian extra virgin olive oil
  • Garlic (preferably from Vessalico)
  • Italian pine nuts
  • Parmesan cheese
  • Pecorino cheese
  • Coarse salt



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Hornby says takeover bid undervalues firm


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Model toymaker Hornby has said a takeover offer from its largest shareholder, Phoenix Asset Management, “significantly undervalues” the firm.

Phoenix has launched a mandatory bid for Hornby, after offering to buy a stake from another investor that would gave it a 55% holding in the firm.

The offer, of 32.375p per share, values Hornby – which also owns the Scalextric and Airfix brands – at £27.4m.

Hornby has advised investors to take “no action for the time being”.

The toymaker also said it had appointed David Adams as its interim chairman, replacing Roger Canham who resigned from Hornby’s board on Wednesday. Mr Canham is also the non-executive chairman of Phoenix Asset Management.

On Wednesday, Hornby had reported falling revenues and deepening annual losses.

The company is struggling to revive its fortunes, which has led to it cut back the number of products it sells.

In the year to 31 March, revenues fell to £47.4m from £55.8m, while underlying losses widened to £6.3m from a £5.7m deficit last year.



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Amazon accuses Walmart of bullying in cloud computing clash


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Walmart said there were cases in which it would not want its data on Amazon’s cloud computing platform

Walmart, the US’s biggest retail chain, has been accused of trying to coerce its technology suppliers into shunning Amazon’s cloud computing service.

Amazon has accused its rival of attempting to “bully” the IT companies into picking a rival platform.

The row follows a report by the Wall Street Journal, which said other unnamed large retailers had also asked vendors to shun Amazon Web Services.

The row comes at a time Amazon is expanding its shopping operations.

Last Friday, the Seattle-based business announced a $13.7bn (£10.8bn) takeover of the groceries chain Whole Foods.

And this week it revealed it had struck a deal with Nike to sell the sportswear-maker’s shoes directly, and that it was launching Prime Wardrobe – a service that lets customers order and try clothes for seven days before deciding which to buy and keep.

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AWS

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AWS was the most profitable part of Amazon’s business in the last quarter

Amazon’s Web Services division may not be as well known to the public as the company’s retail operations, but it is a huge money-earner.

In April, the company reported the unit had generated $3.7bn in sales over the previous three months.

The business provides computing power, online storage, security protection and developer tools to third parties.

Its clients include Netflix, Airbnb, General Electric and the CIA.

According to market research company Gartner, AWS leads the market in its field.

However, Walmart uses Microsoft’s rival Azure service.

A spokesman for Walmart acknowledged it had concerns about its suppliers’ use of AWS.

“Our vendors have the choice of using any cloud provider that meets their needs and their customers’ needs,” he said.

“It shouldn’t be a big surprise that there are cases in which we’d prefer our most sensitive data isn’t sitting on a competitor’s platform.”

Amazon suggested this approach was misguided.

“We’ve heard that Walmart continues to try to bully their suppliers into not using AWS because they have an incorrect view that AWS is somehow supporting Amazon’s retail business,” said a spokesman.

“Plenty of suppliers are standing up to Walmart and refusing to be told that they can’t use [us].

“Tactics like this are bad for business and customers and rarely carry the day.”

AWS’s use of encryption means that its own staff cannot peer into the data stored on its computer servers by its customers.

But one analyst said it was still understandable Walmart and others might not want to help send business its way.

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Getty Images

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Amazon’s takeover of Whole Foods provides it with the supply chain to expand its grocery operations

“AWS is a separate part of Amazon’s business, but ultimately this comes back to being frightened of being disrupted, especially in light of the recent acquisition of Whole Foods,” said Nick McQuire, from the consultancy CCS Insight.

“The question is whether this fear now will cause a wider backlash among retailers, where you get many within the community switching from using AWS in the cloud to Google, Microsoft or someone else.”



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RAF Marham: MoD to spend £135m on F-35 jets airbase


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Ministry of Defence

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The Ministry of Defence is investing £135m on new facilities in preparation for the arrival of the F-35B Lightning aircraft next year

A multimillion-pound contract to support the new fast jets at RAF Marham in Norfolk has been unveiled.

The Ministry of Defence is investing £135m in new facilities in preparation for the arrival of the F-35B Lightning II aircraft next year.

The money will pay for a new hangar to house 12 of the jets and and provide vertical landing pads.

Two existing runways and taxiways will be resurfaced.

Defence Secretary Sir Michael Fallon said: “This contract will ensure that RAF Marham has the facilities to match this world-class aircraft when it arrives next year.

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Getty Images

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The jets have the ability to land vertically

“Throughout the F-35 programme, British firms have won major contracts creating thousands of jobs.

“The contract to improve the runways and taxiways as well as installing new landing pads will bring local jobs to Marham.”

Last year it was announced the government was investing £167m in centres for aircraft training and maintenance at RAF Marham.

Due to open in 2018, three new buildings on the site will provide training facilities for pilots and ground crews.



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Qatar wants 10% of American Airlines


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AFP

American Airlines has received an “unsolicited” approach from Qatar Airways which wants to acquire 10% of the US company.

In a regulatory filing American Airlines said Qatar intended to purchase at least $808m (£638m) of its shares.

American Airlines said it would respond “in due course”.

Shares in American Airlines, which is the biggest airline in the world, are up 5% in pre-market trading.

In 2015, Qatar Airways took a 10% stake in International Airlines Group (IAG), the owner of British Airways (BA) and Iberia.

Then in July 2015 it increased its stake to 20%, becoming IAG’s biggest shareholder.

Earlier this month, Saudi Arabia, Egypt, Bahrain, the United Arab Emirates, Libya, Yemen and the Maldives cut diplomatic ties with Qatar.

Saudi Arabia, the UAE, Bahrain and Egypt all said they would stop flights in and out of Qatar, and close their airspace to the country’s flag carrier, Qatar Airways.



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China raises heat over foreign investment


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Getty Images

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Fosun International bought Championship side Wolves last year for £45m

Shares in two of China’s biggest conglomerates, Fosun International and HNA, fell by about 6% on Thursday, amid rumours that banks had been ordered to assess their loan exposure to them.

Fosun bought Wolverhampton Wanderers football club last year, while HNA is Deutsche Bank’s biggest shareholder.

Reports said the banking regulator had also told lenders to investigate loans to Anbang Insurance, Odeon UK cinema owner Dalian Wanda and Zhejiang Luosen.

All five are big overseas investors.

The conglomerates’ other high profile acquisitions include Zhejiang Luosen buying AC Milan football club earlier this year.

HNA also owns airport services firm Swissport and airline caterer Gate Gourmet, and it has a 25% share in Hilton.

Anbang owns New York’s Waldorf Astoria hotel.

Wanda is the world’s biggest cinema operator, and also owns the UCI chains in the UK.

The China Banking Regulatory Commission (CBRC) had told lenders to conduct internal assessments of their credit-risk exposure to acquisitive companies, according to business magazine Caixin, quoting sources.

The CBRC has been attempting to stem the flow of money leaving China.

Last year China’s companies invested $225bn (£178bn) overseas. The outflow has put pressure on the currency, the renminbi, and drained foreign exchange reserves.



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CMA clears Standard Life-Aberdeen Asset Management merger


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Britain’s competition watchdog has given the green light to the £11bn merger of Standard Life and Aberdeen Asset Management.

The Competition and Markets Authority (CMA) said it had decided not to refer the tie-up to an in-depth investigation.

The decision paves the way for the deal’s completion in August.

The merger will create Europe’s second-biggest fund manager, with £670bn under management.

The enlarged company, to be called Standard Life Aberdeen, will be headed up by Keith Skeoch and Aberdeen boss Martin Gilbert.

On Monday, investors in both firms overwhelmingly backed the merger during general meetings.

The deal, announced in March, is targeting cost savings of £200m a year, with about 800 jobs expected to be lost over a three-year period from a global workforce of 9,000.

In a joint announcement on Thursday, the companies said: “Standard Life and Aberdeen note the announcement today by the CMA that it has completed its review of their proposed merger and has cleared the transaction unconditionally.

“The transaction is currently expected to complete on 14 August 2017, subject to remaining regulatory approvals.”



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Single parents win benefits cap High Court challenge


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PA

Single parents with a child under two have won a court challenge as they face “real misery” from the government’s benefits cap.

A High Court judge said the cap was not intended to cover such households and had “no good purpose”.

The court ruled that the failure to exempt them was discriminatory.

The cap, which limits the income households receive in certain benefits, stands at £23,000 for those in London and £20,000 a year outside London.

Parents must work for at least 16 hours a week to avoid the cap.

The Department for Work and Pensions said it intended to appeal against the ruling.

‘Real damage’

A judge in London ruled on Thursday that he was “satisfied that the claims must succeed” against the work and pensions secretary.

Mr Justice Collins said: “Whether or not the defendant accepts my judgment, the evidence shows that the cap is capable of real damage to individuals such as the claimants.

“They are not workshy but find it, because of the care difficulties, impossible to comply with the work requirement.

“Most lone parents with children under two are not the sort of households the cap was intended to cover and, since they will depend on DHP (Discretionary Housing Payments), they will remain benefit households.

“Real misery is being caused to no good purpose.”

Rebekah Carrier, who represented some families, said: “The benefit cap has had a catastrophic impact upon vulnerable lone parent families and children across the country.

“Single mothers like my clients have been forced into homelessness and reliance on food banks as a result of the benefit cap.

“Thousands of children have been forced into poverty, which has severe long-term effects on the health and well-being.”

‘Extra help’

A spokesman for the Department for Work and Pensions (DWP) said the government was “disappointed” with the decision and intended to appeal.

“Work is the best way to raise living standards, and many parents with young children are employed,” he said.

“The benefit cap incentivises work, even if it’s part-time, as anyone eligible for working tax credits or the equivalent under Universal Credit, is exempt. Even with the cap, lone parents can still receive benefits up to the equivalent salary of £25,000, or £29,000 in London and we have made Discretionary Housing Payments available to people who need extra help.”

He said that households with young babies were among the groups that such housing payments were specifically aimed to assist.

The department said the benefits cap remained in place while the appeal process continued.

Alison Garnham, chief executive of Child Poverty Action Group, said: “We have the ridiculous situation where one part of the DWP has been telling lone parents with very young children that it understands they should not be expected to work, and another part of the DWP is punishing them severely for exactly the same thing.”



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Spare landlords more tax changes, says CML


Landlords should be spared any new tax and regulation changes after a “weak start” to 2017 for the UK buy-to-let sector, lenders say.

Buy-to-let investors have faced a stamp duty surcharge, tax relief changes and stricter affordability checks.

The Council of Mortgage Lenders (CML) said an expected recovery in lending to the sector had failed to materialise.

The impact of these changes should be assessed before any new policies were designed, it said.

However, some would argue that the changes have started to rebalance a housing market that had been skewed in favour of buy-to-let investors and had blocked young people from getting on the housing ladder.

Housing market ‘stalled’

The CML had forecast originally that total buy-to-let lending would reach £38bn this year and the same amount in 2018, but it has now cut that to £35bn in 2017 and £33bn in 2018.

Total lending to the sector was nearly £41bn last year.

“Buy-to-let had a weak start to 2017, and the sector’s contribution to overall net mortgage lending has fallen considerably over the last year,” said CML director general Paul Smee.

“While falling mortgage interest rates have helped support borrowing, tax and prudential measures are exerting pressure on the buy-to-let market. Following the distortion of the stamp duty change on second properties last year, we expected a slight recovery in lending levels. However, this has not materialised, and we therefore have lowered our forecast for buy-to-let lending this year and next.

“This re-emphasises the case for avoiding further changes to the tax and regulatory framework until the effect of these already in train have been properly assessed.”

The CML forecast for mortgage lending as a whole stands at £248bn for 2017. However, it said the housing market had “stalled” in the past few months with monthly UK property sales static at around 100,000, reflecting the wider economic picture.

Mortgage lending remained relatively stable with interest rates remaining low – although there are some signs of a slight increase in the offing – and government assistance for helping some first-time buyers.


Where can I afford to live?



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Paris Airshow: eight takeaways from the major aerospace event


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EPA

The Paris Airshow is taking place this week at a very hot Le Bourget airfield, a few miles from the centre of the city.

The event is held every other year – alternating with the Farnborough Airshow – and is a showcase for the world’s biggest commercial aviation and defence companies – as well as some plucky upstarts that are not quite household names.

Deals worth tens of billions of dollars are done at the show as the hundreds of firms exhibiting their wares pull out all the stops to encourage the top brass from the world’s air forces of the world to stop by, as well as wooing slightly less visible customers.

For a drone’s eye video view of the show click here.

Here are eight things we learned from the 52nd Paris Airshow :

1. Supersonic air travel may return

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Boom

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Boom wants to build a plane akin to Concorde but is economic to operate

Several companies are working on ventures that aim to replicate Concorde’s ability to exceed the speed of sound, including Boom Supersonic. The US firm aims to fly a demonstrator by the end of 2018, with the first paying passengers taking to the skies in 2023 – if all goes to plan. That remains a big if, but founder Blake Scholl insists the venture will be “profitable for airlines and affordable for customers”.

2. Cars can fly

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AeroMobil

Slovakia’s AeroMobil has its flying car on display. Not just a prototype, the vehicle can be converted into something that takes to the skies in just three minutes. But buyers will have be patient as well as have deep pockets: they can order one of the 500 that will be built as long as they have about $1.5m to spare, and can wait until 2020 for delivery.

But even Airbus – one of the world’s biggest plane makers – is taking the idea seriously. Jean-Brice Dumont, chief engineer of Airbus helicopters, says the technology for “flying cars” exists, but legal and social barriers remain, and might be trickier to solve. He makes a bullish prediction: there will be flying cars in our garages within 20 years.

3. Plug and play

An all-electric light aircraft has been designed by the French aerospace research lab Onera. which has a one-fifth scale model on display at its stand. The four to six-passenger plane would be powered by 32 small electric fans each about 50cm in diameter mounted on the wings. Only problem? No manufacturer has yet said it wants to make it.

4. No wires, in high definition

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Thales

In-flight entertainment systems are getting smarter and better. Thales, for example, is giving the latest version of its system capabilities such as wireless headphones, voice control and 4K high definition screens, as well as making it easier to use. Meanwhile, Panasonic has been showing off technology that allows passengers to select movies before and during a flight via the airline’s app on their smartphone. The ability to order food and drinks, or control the lighting over their seat, can also be added.

5. Boeing vs Airbus

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An air show wouldn’t be an air show without an announcement from the world’s two biggest plane makers. Despite being on home turf, Airbus could only manage adding some wingtips to the A380 in a fairly desperate bid to drum up orders for the superjumbo, which have totalled precisely zero for more than 12 months. In a bid to cut operating costs for airlines, Airbus has also squeezed in another 80 seats, meaning a typical layout on the A380plus would be 575 seats.

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Reuters

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Boeing displayed the 737 Max 9 and announced a new model that is 66 inches longer, the Max 10

Airbus has had more luck with the new versions of its short-haul A320 family, which has proved more popular with airlines. Meanwhile, Boeing announced a slightly longer model of the 737 called the Max 10. It can carry about 230 passengers, closer to 240 who can be packed into an A321neo – that capacity is one reason why Airbus has been winning the orders war at this end of the market at least.

6. The private jet is alive and well

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Gulfstream

While it may not be fashionable in certain circles for the super-wealthy to flash their cash, Gulfstream says deliveries to Europe have risen by 25% over the past five years to 230 planes. The General Dynamics-owned firm was at Le Bourget to let potential buyers evaluate its new G500 jet, which is still being certified by regulators. The plane can fly up to 5,000 nautical miles (9,260km) – London to Beijing or Los Angeles – at a speed of 0.85 Mach, which is comparatively quick compared with its rivals. When time is money, these things matter.

While you may think that charter or “fractional” operators such as NetJets or FlexJet are reducing the need for companies or individuals to buy a plane, a Gulfstream spokeswoman says these operators often act as a “stepping stone” to help customers determine whether they need (or simply want) their own aircraft.

7. Where dead planes go to die (or have a rest)

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Tarmac

Tarmac Aerosave calls itself Europe’s leading aircraft storage and recycling company. The firm has now recycled 100 commercial planes and 85 engines since it was set up a decade ago.

It has 100 aircraft in storage at Tarbes, France, where the company will open a second hangar at the end of the year to meet demand. It also has another facility in Teruel, Spain.

Sometimes planes need to go on holiday too, it seems.

8. Jet fighters are very, very loud

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EPA

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A Dassault Rafale fighter jet is put through its paces at the Paris air show

The Dassault Rafale fighter jet was one of the many defence aircraft that wowed the show with daring manoeuvres, along with the Lockheed Martin F35.

Some slightly less nimble planes also took to the skies such as the Airbus A400M, which is frankly a lot more useful than a fighter jet if you have a tank or two to transport.



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FTSE 100 drops as mining shares fall


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Commodity-related shares dragged the benchmark UK share index lower, but there was better news for pharmaceuticals firm Shire.

Shortly after trading began the FTSE 100 index was down 28.61 points, or 0.4%, at 7,419.18.

Mining companies were among the biggest fallers, with Glencore and Anglo American both down by about 1.5%.

Shares in Royal Dutch Shell fell 1.3% and rival BP was also lower as oil prices remained below $45 a barrel.

Shire was the top riser in the FTSE 100, up 1.9% after the European Medicines Agency validated its marketing authorisation application for Veyvondi, which treats an inherited bleeding disorder called von Willebrand disease.

Outside the FTSE 100, shares in Imagination Technologies jumped 15% after the company put itself up for sale.

Imagination is in dispute with its largest customer, Apple, after the US tech giant announced earlier this year that it planned to stop using Imagination’s technology in its products.

On the currency markets, the pound slipped 0.1% against the dollar to $1.2660 and was unchanged against the euro at 1.1350 euros.



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Emergency services face £114m rates bill


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Emergency services are set to face a £113.6m business rates tax increase over five years, new data reveals.

Police stations will be hardest hit, with police chiefs across England and Wales needing to find an extra £60m.

The 15% rise in their rates bills comes as politicians and emergency services are calling for more funding in the wake of recent terror attacks.

Business rates are charged on all commercial properties, similar to council tax.

Changes to the rates were introduced in April after a revaluation of all commercial properties in England and Wales.

But the system has faced heavy criticism already from business leaders, and some spoke out after the government scrapped planned reforms from Wednesday’s Queen’s Speech.

Police stations, which also pay rates, must pay £500m in the tax over the next five years – 15% higher than in the previous seven years.

“Circular money”

Mark Rigby, chief executive of CVS, which conducted the research, said: “We are essentially robbing Peter to pay Paul. Police funding comes from government and these tax increases will come from that budget and paid to councils to fund local services. It’s circular.”

He added: “The 25 Police Training Colleges similarly face sharp tax rises and will pay an extra £8.2m in business rates over the next five years.”

The data comes as police and fire chiefs have been questioning government cuts to services and warning that they are being put under too much pressure.

The Metropolitan Police is in talks to secure more funding after being left “stretched” by terror attacks and a rise in violent crime, according to Commissioner Cressida Dick.

“We need the resources to do the job,” she told BBC London on Tuesday.

Former Met Police Commissioner Lord Blair said London’s police force was “under an enormous amount of pressure”.

“Looking at what is happening, the idea of continually cutting the police services budget seem just an absurdity at this point,” he told Radio 4’s Today programme.

Mayor of London Sadiq Khan said the Met had had to make £600m of savings and was due to lose an extra £400m by 2020.

Police station closures

First Secretary of State Damian Green has denied this, saying: “There are no police cuts. We have protected police budgets in this parliament.”

But, police forces point to rising costs, such as increased business rates bills.

The CVS research also found that ambulance stations will pay an extra £8m in business rates, while fire stations are saddled with an extra £38.4m burden over the next five years.

Details in the register of all commercial properties that pay business rates also found that 20% of police stations have been shut since April 2010 – when the last revaluation took place.

According to the list, there were 2,070 police stations in April 2010, but just 1,668 in England and Wales on 1 April this year.

Business groups and industry figures have been calling on the government to reform business rates for several years.

Chancellor Philip Hammond promised a review at the last Budget, and both the Conservatives and Labour promised to look at the issue in their manifestos.

However, neither party gave any explicit details.

“Hammer blow”

And on Wednesday, the government failed to mention the Local Government Finance Bill, which was supposed to reform parts of the business rates system.

The reforms were to allow local authorities to keep 100% of business rates revenues and give more relief powers and modernise the billing system.

Jerry Schurder, head of business rates at Gerald Eve, said: “The demise of this Bill highlights the government’s disarray over business rates policy and is a hammer blow to UK plc’s hopes of genuine reform in the near future.

“Firms will be furious that, despite their protestations earlier in the year and government promises of action, there will be no reform of a rating system desperately in need of modernisation.

“A particular impact of the omission is that local authorities will no longer be given the powers to reduce business rates locally, a key element of the Bill.”

The snap general election has also left some small businesses struggling, as a promised rates relief was delayed.

The data found that London police stations faced the highest rate rises.

Charing Cross Police Station faces the biggest rates bill in the entire country and will pay £5.7m over the next five years, according to CVS.

Lewisham High Street Police Station faces the greatest increase, with a £1.37m five-year tax hike, as its annual bill grows from £510,435 for 2016-17 to £784,592 per year on average over the next five years.

This takes into account forecasted inflation and transitional relief.



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Imagination Technologies put up for sale amid Apple dispute


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Reuters

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Apple uses Imagination’s technology in its iPhones

UK chip designer Imagination Technologies – which is in dispute with Apple, its largest customer – has put itself up for sale.

Shares in the company more than halved in April when Imagination said that Apple was to stop using its technology.

The US company uses the UK firm’s chip technology in its iPhones, iPads, and iPods under a licensing agreement.

Imagination said it had received interest from suitors in recent weeks so had begun a formal sale process.

It added it was now in preliminary talks with potential bidders.

In April, Imagination said that Apple, which accounts for about half of Imagination’s revenues, was planning to stop using its technology within “15 months to two years”.

At the time, it questioned whether Apple would be able to develop its own computer chip designs without breaching Imagination’s patents.

Last month, Imagination announced it had started a dispute resolution procedure with Apple over licensing payments.

In its latest update, the company said it remained “in dispute” with Apple.

Separately, Imagination said the sale process for its MIPS and Ensigma businesses – which was announced in May – was “progressing well”, with indicative proposals received for both units.



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HS2 franchise: Bidder shortlist revealed


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An artist’s impression of how the new link will look

The companies bidding for the West Coast Partnership rail franchise, which will design and run the HS2 high speed services between London and Birmingham, have been revealed.

The Department for Transport said First Trenitalia West Coast, MTR West Coast Partnership and West Coast Partnership had all been shortlisted.

The franchise will also be responsible for the West Coast Main Line.

The bidders for the South Eastern franchise have also been announced.

All three have a non-British partner.

Transport Secretary Chris Grayling said the West Coast Partnership would help to “ensure that HS2 becomes the backbone of Britain’s railways”.

The West Coast Partnership is a new rail franchise which will combine the current InterCity West Coast main line with the planned HS2 high-speed services.

The operator will be responsible for services on both the West Coast main line from 2019 and running the initial HS2 services in 2026.

The West Coast franchise is currently run by Virgin Trains as a joint venture between Stagecoach and Virgin.

Reduce journey times

First Trenitalia West Coast is a joint venture between First Rail Holdings and Italy’s Trenitalia. Earlier this year it took on the C2C rail franchise.

MTR West Coast Partnership is a joint venture between Hong Kong’s MTR Corporation and China’s Guangshen Railway Company.

West Coast Partnership is a joint venture between Stagecoach Group, Virgin Holdings Ltd and France’s SNCF C3.

HS2 will run between London and Birmingham.

Construction will begin later this year and it is expected to reduce rail times between Birmingham and London by 32 minutes.

A second Y-shaped phase of HS2 will open in two stages.

The line from Birmingham to Crewe will launch in 2027, with the remaining construction – which includes a spur taking HS2 to a new station at Manchester Airport – due to finish six years later.

There are four companies on the shortlist for the next South Eastern franchise, which Mr Graylng described as “one of the busiest” in the UK, running nearly 2,000 services every weekday.

  • South Eastern Holdings is a joint venture company which, on franchise award, will be wholly owned by Abellio Transport Group and East Japan Railway and Mitsui & Co.
  • London and South East Passenger Rail Services, a wholly owned subsidiary of Govia.
  • Stagecoach South Eastern Trains which is a wholly owned subsidiary of Stagecoach Group.
  • And Trenitalia is also bidding for the South Eastern franchise.



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Fruit and veg farmers facing migrant labour shortages


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Media captionFruit farmers are finding it hard to recruit pickers

UK summer fruit and salad growers are having difficulty recruiting pickers, with more than half saying they don’t know if they will have enough migrant workers to harvest their crops.

Many growers blame the weak pound which has reduced their workers’ earning power, as well as uncertainty over Brexit, according to a BBC survey.

About 80,000 seasonal workers a year pick and process British fruit and veg.

Most of them are from the European Union, mainly Romania and Bulgaria.

One in five growers says they already have fewer pickers than they need.

British Summer Fruits, the body which represents soft fruit growers, says labour shortages are now the worst seen since 2004.

Recruitment was getting harder even before the vote to leave the EU. But the industry believes Brexit is exacerbating the problem and if access to non-UK workers dries up, it could cripple home-grown berry production.

Big response

Their concern is backed up by an in-depth survey of growers by the BBC.

The questionnaire was sent to members of the British Leafy Salad Association and British Summer Fruits, which represent 90% of growers in their sector.

There was a big response. Three-quarters of growers completed the survey, which was carried out between 16 May and 5 June, as harvesting started to peak.

We asked if they had enough seasonal workers for the start of the main picking season:

  • 32% said they weren’t sure
  • 18% said they had slightly fewer than they needed
  • Just over 3% reported having many fewer than required
  • 42% said they had just enough
  • 1% said they had more than enough

Meanwhile, 78% of respondents said recruitment had been more difficult than last year, with 20% saying it had been the hardest for years.

‘Not comfortable’

At Wilkin and Sons in Essex, the picking season for strawberries is in full swing. But this year, they have 20% fewer workers than they would like.

“We’re managing, but we’re not comfortable,” said joint managing director Chris Newenham.

“Our seasonal workers are a critical resource for us to be able to save our crop each year. And the logical extension of not being able to harvest that crop is that we will have to bring our production in from overseas and that’s a position none of us want to see. ”

He’s not the only one. Of those surveyed, 71% said they would consider reducing UK production if there were future restrictions on seasonal workers.

British Summer Fruits has commissioned its own separate report, just published, on the potential implications for its growers, and consumers, of Brexit.

It warns that soft fruit prices could rise by up to 50% if the UK relied solely on imports.

“It is inconceivable that people who voted to leave the European Union wanted to destroy an iconic and incredibly competitive British horticulture industry,” said Laurence Olins, chairman of British Summer Fruits.

“Failure to secure the future of soft fruit production in the UK will have a negative impact on the economy, family budgets, the nation’s health, UK food security and the environment,” he added.

So why doesn’t horticulture, now a £3bn industry, simply try to employ British workers?

The answer is straightforward for Beverley Dixon, from G’s Fresh, which employs some 2,500 seasonal workers growing salad crops across large areas of Cambridgeshire and Norfolk, as well as other farms dotted across the UK.

“We operate in areas of such low unemployment, so here in Cambridgeshire, it’s less than 1.5%,” she said.

“So there simply aren’t the people available to do the work, added to which UK people tend to want permanent year-round work and this is seasonal work.’

Reliance on migrant workers isn’t a specific challenge for the UK, according to David Swales, analyst at the Agriculture and Horticulture Development Board.

“If we look at other developed countries around the world, places like Australia and New Zealand, they source labour from the Pacific Islands.

“In the US, they source labour from Mexico and the Caribbean countries. So there are a number of places where countries have to go outside their borders to source the seasonal workers that they need,” he added.

Obvious solution?

The nationalities of these workers have changed over the decades in the UK. There used to be a seasonal agricultural workers scheme which allowed growers and farmers to attract workers from across the world.

The industry says it worked and believes it’s the obvious solution now Britain has decided to leave the EU.

During a recent select committee inquiry into seasonal labour shortfalls, the government said net migration figures showed that sufficient labour was available in the UK and that there was currently no need for a seasonal agricultural workers scheme for migrants.

The BBC survey is hard evidence that recruitment has proved tougher this year, with some shortages reported.

A government spokesperson said: “The government places great value on the UK’s food and farming industries, both as a crucial component of the UK economy and of the fabric of rural Britain.

“We are determined to get the best deal for the UK in our negotiations to leave the EU, not least for our world-leading food and farming industry, which is a key part of our nation’s economic success.”



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Energy revolution


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China may consume more electricity than any other country, but it is also now the world’s biggest solar energy producer

Ten years ago, Geof Moser had just graduated with a master’s degree in solar energy from Arizona State University – but he didn’t feel much opportunity lay at his feet in his home country.

So he headed for China.

“The solar industry was fairly small and there weren’t a lot of jobs,” he remembers. “Just a few for installation.” But the Chinese government had big ambitions to expand solar and Moser saw his chance.

He spent some years accumulating knowledge about the Chinese solar industry, before co-founding Symtech Solar, which designs solar panel systems using Chinese parts.

Market access

The idea is to make it easy for organisations outside China to access components without the hassle of having to source and assemble lots of different parts.

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Symtech

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Geof Moser took his solar energy expertise to China because of the opportunities in the industry

“You don’t want to buy a car door or a car engine, you want to buy a car,” he explains.

Symtech now has a portfolio of small projects dotted around the world and it is hoping to increase installations in the Middle East, thanks to a new office in Oman.

Moser isn’t the only US entrepreneur who turned to China. Alex Shoer, of Seeder, helped to launch a business that brings solar panels to the roofs of buildings within the country.

He deals with foreign businesses who, say, want to make their Beijing office a little greener. The firm says it has so far erected three megawatts’ worth of solar installations, with another 28 megawatts on the way for various clients.

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Getty Images

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China installed more than 34 gigawatts of solar capacity in 2016

“We will source the capital to finance, pay for the whole project and then sell the power at a discount,” Moser says. Again, the model relies on sourcing the right parts at a favourable cost.

These kind of installations are known as “distributed generation” projects, in which electricity is produced on a small scale, at or very near to a specific point of consumption.

Within China, distributed generation is growing at an extraordinary rate, driven in large part by farmers who use the panels to power agricultural equipment that might not be connected to the grid.

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Getty Images

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China’s mega projects have become possible thanks to the rapidly falling cost of solar cells

Shoer comments that he was attracted by Beijing’s commitment to the solar industry. For years it has encouraged local authorities to do what they can to boost production, research and development.

Renewables growth

China’s rapid expansion of renewable energy facilities has since caught headlines around the world.

According to the International Energy Agency (IEA), the country installed more than 34 gigawatts of solar capacity in 2016 – more than double the figure for the US and nearly half of the total added capacity worldwide that year.

Early figures for 2017 show China has added another eight gigawatts in the first quarter alone.

“It’s a huge market,” says Heymi Bahar at the IEA. Most of the world’s solar cells are made in China and Taiwan, he adds – more than 60%.

The impressive scale doesn’t stop there. The largest solar farm in the world – Longyangxia Dam Solar Park, all 30sq km of it – is a Chinese project. And the country recently opened the world’s largest floating solar farm, in Huainan, Anhui Province.

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China has the world’s largest floating solar power plant

It has been constructed over an old coal mine, which over the years had filled with rainwater. Sungrow, the Chinese firm that provided solar cells for the venture, says its system automatically monitors current and voltage generated by the cells, along with humidity, which can affect their efficiency.

Because of the abundant water nearby, cleaning the panels – an endless task for solar farmers – will be easier, according to those behind the facility.

These mega projects have become possible, and indeed more common, thanks to the rapidly falling cost of solar cells.

“What we were all hoping for 20 years ago when the idea of cheap solar was just a dream, was that someone would come into this on an industrial scale and drive down the cost,” recalls Charles Donovan, at Imperial College Business School.

“That is exactly what China has done.”

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Getty Images

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Despite China’s impressive progress, only 1% of its power comes from solar energy

But today, solar energy production accounts for just 1% of China’s total energy demand. A huge 66% of demand still comes from coal, something that the country’s National Energy Administration wants to change drastically by 2050 – not least because of China’s well-known air pollution problems.

But by that key date of 2050, a very different mix of energies could be powering China, should some projections become reality. One government report even suggested that renewables could supply 86% of the country’s energy needs, with solar providing around a third of that.

Can China do it? According to one expert observer, the answer is, “maybe”.

“What China is trying to do is rationalise a very large, fast growing system,” explains Jeffrey Ball at Stanford University’s Center for Energy Policy and Finance. Ball is the lead author of a recent report that details China’s success as an innovator in the solar panel industry.

Lofty ambitions

But as Ball points out, the revolution has not been without teething issues. For one thing, Chinese subsidies, which some argue are unsustainable, have not always been smoothly administered. The “feed-in tariff”, for example, often offered to solar companies that generate electricity, has sometimes been paid late.

“The government is often a year or more late in delivering that revenue – that wreaks havoc with the financials on a project,” says Ball.

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China has recently cut the value of the subsidies it gives to solar power producers

The value of subsidies has recently been cut, too. What’s more, China’s large solar farms are largely in less densely populated areas in the west of the country, far from population centres like Beijing or Shanghai, in the east.

Building extra grid capacity to transfer it is time-consuming and expensive. This leads to a problem known as curtailment – a solar farm produces, say, 20 megawatts of electricity but can only find buyers for 15 megawatts.

More from Future Energy

“Depending on who you talk to in the provinces that have by far the largest amount of solar production, curtailment rates are 30% and in some cases significantly higher than 30% – that’s extraordinary and that’s a real problem,” explains Ball.

Whether China can achieve its lofty ambitions for renewable energy remains to be seen – but it has certainly proved its ability to foster a world-leading solar industry. For US entrepreneurs like Geof Moser, that’s enough to propel his own business towards further growth for now.

“The reality is that renewable energy is very cheap – especially solar energy,” he says. “And the reason is China.”



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Green light for UK driverless car road trials


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PA

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Connected cars will alert the driver if an emergency vehicle is nearby

A demonstration of driverless cars in Nuneaton will be followed later this year by trials on public roads.

Autodrive – a collaboration between Jaguar Land Rover, Ford and Tata Motors – showed off how autonomous cars can talk to each other.

It included warning drivers when an emergency vehicle was approaching and offering real-time traffic information.

The first set of public road trials are due to take place in Milton Keynes and Coventry by the end of the year.

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PA

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Cars that talk to each other are part of the driverless revolution but currently a human must still be at the wheel

A fleet of up to 40 self-driving pavement-based ‘pods’ will also be introduced in pedestrianised areas of Milton Keynes.

Another aspect of the demo showed how connected cars can detect the presence of other connected cars on the approach to a junction and warn drivers if there is a high probability of a collision.

“The successful completion of the proving ground trials marks a significant milestone for the project team, and we are now looking forward to demonstrating the benefits of these exciting new technologies in the real-world settings of Milton Keynes and Coventry,” said Tim Armitage, UK Autodrive project director.

“Once the technology becomes widely available, we anticipate huge potential benefits in terms of road safety, improved traffic flow and general access to transport, so we’re really excited about being able to demonstrate this on real roads.”

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LUTZ Pathfinder

Image caption

Driverless pods will be available in pedestrian areas of Milton Keynes

There are similar trials going on around the UK, including in Greenwich which is using similar pods to those planned for Milton Keynes.

A consortium of British companies known as Driven are planning to test driverless cars on motorways in 2019.

The UK government has paved the way for driverless cars, laying out a legislative framework in the Queen’s Speech which included plans to update car insurance so that driverless vehicles would be subject to the same rules as normal ones.

The technology that allows cars to become more autonomous has been increasing in recent years with all the main manufacturers now offering some element of driverless technology, including self-parking features and cruise control on motorways.

UK government research suggests that the market for automated vehicles in the UK will be worth £28bn by 2035.



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WhatsApp rises as a major force in news media


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WhatsApp is owned by Facebook, so its rise potentially gives its parent even more influence over the media

WhatsApp is becoming one of the prevailing ways people discover and discuss news, according to a study.

But use of the messaging app appears to vary widely between countries.

In Malaysia, more than 50% of those surveyed said they used WhatsApp for news at least once a week. But in the US, the figure was only 3%, and in the UK it was 5%.

The Digital News Study also indicates the Brexit debate has led to growing mistrust of the UK’s media.

It said only 43% of respondents declared that the news could be trusted – down from 50% last year – with the BBC in particular criticised for having both a pro-EU bias and failing to expose the “distortions” of the leave campaign.

Private is popular

The research was carried out by the Reuters Institute For The Study of Journalism and covered 34 countries in Europe, the Americas and Asia, in addition to Taiwan and Hong Kong.

A total of 71,805 people were questioned by YouGov in January and February to generate its data.

The results indicate that Facebook remains the most popular social media and messaging service for news engagement in all but two countries – Japan and South Korea – where, respectively, YouTube and Kakao Talk dominate.

But it adds that use of Facebook for news had dipped in more than half of all the territories where a year-on-year comparison was possible.

By contrast, sharing news stories and chatting about them appears to be on the rise within private instant messaging apps, and WhatsApp in particular.

According to the report, WhatsApp is now the second most popular social service for news in nine of the 36 locations, and the third most popular platform in a further five countries.

The authors provide several potential explanations for WhatsApp’s rise.

Its use of end-to-end encryption means messages can only be seen by their senders and recipients, offering users protection against being monitored by the authorities.

“Some of the biggest growth we’ve seen is in places like Turkey, where it’s positively dangerous for people to express anti-government preferences on open networks like Facebook,” explained one of the study’s authors, Nic Newman.

“As a result people are using closed groups where they are more confident of expressing their views.”

WhatsApp has also benefited from the fact that in much of Latin America and elsewhere mobile networks are offering unlimited data use within the program, so encouraging its use.

Furthermore, several Spanish and Chilean media outlets have embraced the app. Radio stations commonly ask listeners to send in short voice recordings via the service, and local news sites have added share-to-WhatsApp buttons to their pages.

However, Mr Newman said beyond that, it was difficult for the media to take advantage of the app’s popularity beyond publishing stories that people want to share.

“You can set up branded areas or groups of people on your own, but it’s incredibly clunky and time consuming, and there are few tools to help,” he explained.

“And part of WhatsApp’s appeal is that users don’t get interrupted by brands, making it a very pure form of messaging. That’s something [its developers] will really try to hold to.”

Too close to power

The report also highlights widespread concerns about so-called “fake news”.

It highlights users’ suspicions that social media’s lack of rules and use of viral algorithms have helped low-quality false stories spread quickly.

But it says there is also strong distrust of the mainstream media, in particular in Asian and central, southern and eastern European countries, where the industry is perceived as being too close to government.


Analysis: Amol Rajan, Media Editor

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The Brexit debate appears to have led to growing distrust in the UK media

This year’s Digital News Report is even more sobering than usual.

Many of the institutions that contribute to democracy in the West are undergoing a crisis of trust. News providers are no exception. UK citizens’ trust in news “in general” has fallen by 7% since the Brexit referendum, the report suggests.

That is a worrying drop. Combine it with Reuters’ revelation that the proportion of people paying for online news in the UK remains “among the lowest of all countries” surveyed, and alarm bells should ring.

One reason for this could be the BBC, whose dominance in our news ecosystem might mean fewer people feel the need to pay for good information.

For a new generation, the link between high-quality general news and payment for that news might be breaking.

The internet has made general, daily news a very common commodity. With tech giants like Facebook and Google eating ever more of the advertising pie, news providers may find they have to specialise if they are to get audiences to part with cash. And those audiences won’t pay for content they don’t trust.

Rebuilding that trust, in an era of digital echo chambers and fake news, is going to be tough. But it must be done.


Yahoo News remains the most popular online news brand, in terms of the numbers of people using it at least once a week, across the 36 markets as a whole.

It also ranked as the top online source of online news in the US, Japan and Taiwan.

Its success may have been driven in part by the fact many users said it was better at delivering “amusing and entertaining” content than the competition.

Other findings reported include:

  • dedicated news apps appear to be making a “comeback”, but this is thought to be because existing users are making more regular use of the programs rather than there being a surge in the number of new installs
  • Apple News is one of the fastest growing news aggregator services, with some publishers reporting that up to a third of their mobile traffic now comes from the app and its related widget, which flags stories on iOS devices’ search screens
  • online video remains a tough sell, with nearly half of respondents saying they had not consumed a clip on a news site or via social media in the past week

Blocking ad blockers

Making money from online news remains problematic.

The study said 84% of respondents had not paid for content in the past year.

However, it highlighted that there had been a “Trump bump” in the US, where several newspapers had attracted hundreds of thousands of new digital subscribers, many of whom have left-wing views and are under 35.

Another development that will be welcomed by the industry is that the use of ad blockers on desktop PCs appears to have stalled and remains low on smartphones, with only 7% of respondents saying they had installed advert removing software on their handset.

Moreover, a “tough love” approach taken by some publishers – whereby they block access to their content if an ad blocker is in use – appears to have convinced many users to at least temporarily suspend the plug-in’s use.



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'There's no judgement'


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No Lights No Lycra

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No Lights No Lycra sessions are kept deliberately dark

Annie Blatchford has just finished dancing with 50 strangers in the darkness of a hired church hall.

With the windows covered over to keep out the daylight, she could barely see her fellow dancers as they all got lost in the music at the alcohol-free gathering, in Melbourne, Australia.

Annie, 26, says she is normally too shy to dance in public, but that it is much easier to go for it when she knows that no-one is watching.

“There is no judgement, or need to feel uncomfortable,” she says. “It was a great space to let loose.”

Annie is one of thousands of people around the world who now meet regularly to dance together in near darkness (there is just enough light to prevent you from bumping into other participants), as part of a dance organisation called No Lights No Lycra.

It is part of a growing change in the world of dance classes for women, away from the formality of mirror-lined exercise studios, and pressures to get your moves correct and in time with everyone else.

Instead the emphasis is increasingly on unstructured fun, not taking yourself seriously, and the freedom to dance without any concern about how you look, or whether you should be losing any weight.

In addition to the success of No Lights No Lyrca, the movement has seen the rise of dance classes based solely upon the distinctive moves of US singer Beyonce, or the poses made by New York drag queens.

As the old saying goes, “dance like no-one is watching”. That was what Melbourne friends Alice Glenn and Heidi Barrett, both 34, had in mind when they founded No Lights No Lycra in 2009.

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No Lights No Lycra

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Alice Glenn and Heidi Barrett dancing with the lights on for a change

“We were just tired of going to dance classes and trying to move the way everyone else was moving, and constantly being critical of ourselves,” says Alice.

“People want to enjoy that freedom of moving just because it feels good, not because you look great.”

A 2013 report said the fitness industry needed to cater more for young people who had rejected the health clubs of their parents’ generation in favour of exercise regimes that place an emphasis on music and community relationships.

That was another motivation, adds Alice, who says that participants don’t have “to take themselves too seriously”.

While just five people attended the first No Lights No Lyrca session in the fashionable Melbourne suburb of Fitzroy, within six months numbers hit 100 people a week.

“It all just went gangbusters,” says Alice, especially after a friend started a franchise in Brooklyn that was covered in the New York Times.

No Lights No Lyrca now operates in 75 locations around the world, including Los Angeles and Hong Kong. Prices vary, although in Melbourne the cost-per-class is seven Australian dollars ($5.30; £4.30).

Franchises pay about 200 Australian dollars a year, plus a portion of their earnings for larger operations.

In Miami, Florida, Simone Sobers decided to launch a dance workout after she learned that women of colour had particularly high levels of obesity and heart disease.

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Boss Chick

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Miami-based Simone Sobers (in red shoes) had a sell-out tour of her Boss Chick workout

“I wanted to use elements of our culture that we could easily connect with – music and dance,” she says.

Simone’s Boss Chick Dance Workout is a combination of styles – hip-hop, dance hall, afrobeat, and twerking. Classes are for women only, so that they can “let loose without the male gaze, and have a safe space to dance in a sexy way”.

With just $100 in the bank, Simone started the classes back in 2013. It has now expanded to New York and Philadelphia, with classes costing between $14 and $25. She event staged a sold-out 21-city tour across the US.

Back in Melbourne, Liz Cahalan’s company Bey Dance is devoted almost entirely to the spirit of the singer Beyonce.

A dancer by profession, Liz says she was inspired by her love of the music video for Beyonce’s 2008 hit single Single Ladies.

The first Bey Dance studio opened last year in the Australian city, and has since expanded across the country to Perth and Adelaide.

Liz now employs 35 people to help teach the classes and maintain the business.

“It became about more than just a dance class,” she says. “It became about teaching women that it is OK to have curves, to feel powerful about the way that you stand with your body.”

Liz adds that she thinks the rise of classes such as Bey Dance and No Lights No Lycra was “one of those zeitgeist things”. She says like-minded people became tired of feeling like they “couldn’t dance because we weren’t a certain body shape, that we didn’t have a certain technique, or do ballet”.

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Beydance

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Beydance’s classes are a bit with Beyonce fans

In London, Juliet Murrell got inspiration for her House of Voga dance classes from a 1980 documentary called Paris Is Burning that chronicled New York’s drag scene.

The film showcased the “vogueing” style of dance popular with drag queens at the time, which involves brief pauses in movement to pose, as if for a camera.

Juliet’s classes, which launched in 2013 combine vogueing moves with yoga.

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Voga

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Juliet Murrell’s dance sessions are inspired by a 1980 documentary

“There’s a focus on arm, gesture, body language and coordinated arm movements,” she says of the classes, which have now expanded to Paris, Edinburgh and Barcelona.

“There’s an increasing appetite for unique dance classes as people want to feel they’re upping their skills and feeling great,” adds Juliet. “It’s exciting, it is like nothing they’ve done before.”


Follow Business Brain series editor Will Smale on Twitter @WillSmale1



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