LONDON’S BUSINESS NEWSPAPER
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WARNING ON CHINA SUPPLY CHAIN THREAT
THURSDAY 1 DECEMBER 2022
ISSUE 3,900
FROSTY STANCE COULD PROMPT RETALIATION: THINK TANK STEFAN BOSCIA THE UK is particularly vulnerable to China’s potential ability to disrupt international supply chains, a think tank has warned. The Evenstar Institute, a London foreign policy think tank, said in a new report today that “Beijing has repeatedly targeted direct trade for strategic purposes in recent years” and that “the UK is heavily exposed indirectly to China via third countries over which
Beijing has significant influence”. The Evenstar paper said there was “every reason to suspect” that Beijing would intentionally disrupt UK supply chains as retaliation for London’s increasingly frosty stance against China over the past few years. It comes as Rishi Sunak earlier this week called for more “engagement and cooperation” with the growing superpower, while also declaring that the “golden era” of UK-China relations was over. He also warned about the threat China poses to the UK’s national security, with the government this week buying out a state-owned Chinese firm from its stake in t h e
Sizewell C nuclear plant. Evenstar said the UK’s defence supply chains could be at risk of Beijing-forced disruption. “The exposure of the UK’s supply chain to China should be a key national security concern,” the think tank said. The Prime Minister’s tone toward China has been considered a climbdown from his tough anti-Beijing rhetoric during the Tory leadership race, which has frustrated some of his backbenchers. Former Prime Minister Liz Truss was planning on designating China as an official “threat” instead of a “systemic competitor”, however Sunak is now unlikely to make this designation. Tory MP Sir Paul Beresford said yesterday during Prime Minister’s Questions that Sunak must get tougher on Beijing. “China is more than just, as [Sunak] put it, a systemic challenge, but in fact an expanding, serious geopolitical threat,” he said.
KISS GOODBYE? Mulberry boss latest to warn London missing out EMILY HAWKINS THE MAN behind luxury bag outfit Mulberry has urged ministers to reconsider a VAT-free shopping policy for tourists. Some affluent shoppers were favouring shopping sprees in Paris or Milan over London, Mulberry boss Thierry Andretta said yesterday. “The wealthy are still buying but they’re not choosing to buy in London,” he told PA. Ministers have stuck to their guns after ditching a plan to introduce taxfree shopping for tourists, to the dismay of many luxury retailers in
the West End. Sales on Bond Street and Regent Street have been impacted as tourists from the US and the Arab states shun the capital for locations they can benefit from tax breaks, Thierry said. The UK’s refusal on the policy made it look like “bloody fools,” the boss of West End landlord Shaftesbury told City A.M. yesterday. Ministers had scored an “own goal” ditching the policy, Brian Bickell said. Responding to the calls, a HM Treasury spokesperson said a VATfree shopping scheme would “come at too high of a cost”.
HSBC to ditch more than 100 branches as Brits flock to mobile banking JACK BARNETT BRITAIN’s biggest lender HSBC is closing 114 high street branches from next April driven by consumers shunning over the counter services in favour of online banking, it announced yesterday. The number of Brits visiting their local HSBC branch has plummeted
since the pandemic, which engineered a surge in mobile banking app usage to reduce social contact. The move adds to the 69 branches HSBC said it was ditching in March and means around one in four stores are now set to shut. Over the past decade, online banking apps have emerged as the
main tool households use to budget. The switch to mobile banking, aided by the ascent of smart phones, has watered down incentives for lenders to maintain a large high street presence, prompting a wave of branch closures in recent years. Footfall in 74 per cent of branches HSBC is closing has collapsed at least 50 per cent.
Policymakers have warned the shrinking presence of high street bank branches could result in people who still rely on cash – typically older Brits – being frozen out of the country’s financial network. Jackie Uhi, managing director of UK distribution at HSBC, said footfall in many branches had reached “an alltime low, with no signs of returning”.
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