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OPINION

Seven Days

Seven Days
March 19, 2015
Seven Days

North Sea flip

Quick sale

The Russian billionaire investor Mikhail Fridman is believed to be planning to offload the North Sea oil and gas fields he recently acquired as part of the deal to buy German energy business Dea from RWE. A sale would also avert a possible run in with the UK government after energy secretary Ed Davey threatened to launch a legal block against the deal due to fears of further tightening of sanctions against Russia affecting Mr Fridman's LetterOne Group. Mr Fridman is not the only seller of North Sea assets following the oil price slump with French giant Total also rumoured to be looking to offload North Sea assets.

High street blues

More shops shut

Despite the ongoing economic recovery in the UK, the high street remains in the doldrums. Indeed, the net number of shop closure on the UK high streets rose last year compared with 2013 as the collapse of mobile phone chain Phones4U in particular exacerbated the trend, accounting for the loss of 419 of the near-1,000 shops which shut in 2014. Reseach by PricewaterhouseCoopers and the Local Data Company showed that the pain was widespread with even London seeing net closures, but the worst affected high streets were in the Midlands and north west.

Irish eyes are smiling

Economy rockets

The Irish probably celebrated St Patrick's Day this week with even more gusto usual. That's because the latest data from the Irish economy suggests the good times are well and truly back as the rate of growth and job creation has spread out from the capital into the regions. Ireland posted GDP growth of 4.8 per cent in 2014, the strongest of any eurozone nation by some way as it was bolstered by the recoveries in the UK and US economies that it is particularly dependent on.

Bank battle

Asian pretender

The US is becoming increasingly uneasy at the sight of its traditional economic allies throwing their lot in with China. The latest concerns surround the decision of the likes of the UK and Germany to become founder members of the Asian Infrastructure Investment Bank (AIIB), a $50bn Chinese-led initiative which some suggest could come to rival the World Bank in terms of its investment power in Asia, but which some in the US administration view as something of a Trojan horse for deepening Chinese influence in the region. One un-named US official was quoted by the Financial Times as saying: "We are wary about a trend toward constant accommodation of China."

Tantrum warning

IMF concern

The world, and in particular its emerging economies, should beware a re-run of the 'taper tantrum' which rocked equity markets back in 2013. Back then it was merely the nuanced suggestion that the US may soon begin the process of 'normalising' interest rates which saw emerging markets currencies fall out of bed and capital outflows go through the roof. Now, the likelihood of interest rate rises in the US is increasingly certain, prompting IMF chief Christine Lagarde to warn: "Even if this process is well managed, the likely volatility in financial markets could give rise to potential stability risks."

£15bn off

Capital reduction

The scale of the retrenchment in government spending enacted by the coalition government after it took the reins in 2010 is becoming clearer the more data emerges from the past five years. Capital spending on infrastructure, both new projects and maintenance has slumped by one third from its peak of £57bn in 2009-10 to £42bn in 2013-14 with spending on schools and housing taking the brunt of the cuts with both falling by more than half while health and defence capital spending each fell by around a quarter.