Monday 5 June 2023

GO BEFORE THE CROWDS WHY NOW IS THE PERFECT TIME TO VISIT JAPAN P16

CITY KEEPS EUROPEAN FINANCE LEAD

(...YES, DESPITE BREXIT)

JACK BARNETT

LONDON is beating away the dire warnings that Brexit would knock it off its perch as Europe’s top finance hive and is even drawing in more investors amid high inflation and interest rates, a new report out today unveils.

Some had bet that the UK’s decision to leave the European Union (EU) would trigger a flight of jobs, investment and innovation to the continent, but research by EY suggests the global finance community has yet to sour on the country.

In fact, the UK has topped the consultancy’s finance foreign direct investment table every year since the 2016 Brexit vote and since the research started. Similarly, London has led the European city table since it was first constructed in 1986.

CLOSE BUT NO

CIGAR

LEWIS HAMILTON SAYS HE’S ‘FLAT OUT’ TO BEAT RED BULLS P20

“Investors recognise the strength, gold-standard governance and resilience of the UK’s financial system and see it as the preferred destination for growth, innovation and access to top talent,” Anna Anthony, UK financial services managing partner at EY, said.

Foreign investors pumped cash into 46 financial services projects in the capital last year, up from 39 in 2021.

That rise pulled the Square Mile away from its continental rivals. Paris drew in outside investment for 35 finance proposals, down from 38. Madrid and Milan were third and fourth.

“London continues to lead Europe in attracting foreign direct investment in financial services, and the sector is proving resilient despite the global challenges facing the UK economy,”

Chris Hayward, policy chairman at the City of London Corporation,

told City A.M.

“That is good news for every household, because a strong City creates the wealth and jobs that support the economy and fund our public services,” he added.

Overall, the UK attracted foreign investors to 76 financial services projects last year, up 13 from 2021, putting the country ahead of France by 31, which recorded 15 fewer projects compared to 2021.

The City minister Andrew Griffith welcomed the figures as he and Treasury ministers plot reforms to the financial services sector which it says will make it more innovative.

Some of the impacts of Brexit are still yet to become clear. The UK is home to the majority of Euro-based clearing, the future of which is uncertain, with the EU demanding most or all of it is ‘reshored’ to the continent by 2025.

JAMES SILVER

GET ready for the annual office battles over the temperature of the air conditioning: the summer, it appears, is finally here.

The temperature is set to stay above 20 celsius all week, with the Square Mile’s restaurants, pubs and bars hoping for bumper lunchtime and post-work trade after a quiet halfterm week.

Treasury to look at employee ownership schemes in bid to boost productivity

EXCLUSIVE

JACK BARNETT

RISHI Sunak and Jeremy Hunt are drawing up plans to revamp schemes designed to hand workers a stake in their employers, City A.M. can reveal. The Treasury will today ask businesses for their view on the

effectiveness of governmentsponsored programmes that steer staff toward taking stakes in their employer by offering financial incentives.

The Prime Minister and Chancellor hope the shake up will stimulate economic growth by raising worker productivity and motivation.

Under the current landscape, workers can buy discounted shares in the company they work for –if that company has signed up –providing they set aside up to £500 each month for either three or five years, in what is known as the Save As You Earn programme.

A separate package,

called the Share Incentive Plan, allows firms to gift staff up to £3,600 of equity in their company or help employees with the cost of purchasing shares.

A selection of tax reliefs are available on each of the programmes, from income tax through to capital gains.

The consultation is part of a government push to boost the nation’s productivity.

£ CONTINUED ON PAGE 2

STANDING UP FOR THE CITY

A 2p tax cut will require a philosophical changing of the guard

Is Rishi Sunak really mulling a significant pre-election tax cut? Well, probably. Goodness knows judging from the poll ratings he and his party need to do something. But whether it happens will depend on whether the Tories have still got the courage to stand up to a few miserable headlines.

Let’s say Jeremy Hunt announces a tuppence cut for the nation, leaving more of our own money in our own pockets. It might

THE CITY VIEW

bring the country’s tax burden below the absurd high at which it currently stands, roughly equivalent to the time we were still paying back World War II debts. But it would also create an almighty brouhaha with the nation’s self-appointed fiscal

watchdogs, for whom the share of the economy controlled by the state can only ever grow. Thank goodness, then, for work being done amongst some of Westminster’s more free-market think tanks.

The Taxpayers’ Alliance have developed a dynamic taxation model, which allows –and the fact this sounds radical is a sad state of affairs –the different behaviours engendered by tax changes to be factored into the

public finances. The aim is to break away from the idea that a tax cut somehow ‘costs’ the Treasury, rather than simply giving the government less to play with in the first place. If it sounds academic, it’s not: it’s a philosophical point, and the current lingua franca comes from the wrong-headed starting point that money belongs to the government and only in its charity and mercy does it allow you to spend it on what you want,

THE FORCE... AWAKENS? Comic Con stormtroopers check a carbonite version of Han Solo, of Star Wars fame, during the self-described geek culture festival in Portsmouth

‘Can’t come soon enough’: Tory groups cheer news of potential 2p income tax cut

JESSICA FRANK-KEYES

RISHI SUNAK’s mooted plan to reduce the tax burden from a seven-decade high with a 2p cut in income tax ahead of the next election has been welcomed by Tory campaign groups. Reports surfaced in the Sunday Telegraph that the PM – an ex-City banker – is keen to cut charges in order to incentivise work and wants to head into the campaign “promising more”. Officials have privately suggested that the economic recovery is likely to be strong enough by early next year for Sunak to announce a cut in the

spring statement, according to the report.

It comes just days after the International Monetary Fund warned ministers against tax cuts, which they said risk fuelling inflation and keeping interest rates high.

Ryan Shorthouse, chief executive of Conservative think tank Bright Blue, said that the government was right to focus on cutting taxes on income from work and stressed that “the weight of taxation in this country is on work and working-aged people”.

“The most targeted way of cutting taxes on income from work would be

raising the personal allowance for income tax and the primary threshold for national insurance,” he added.

“The government could choose to go quicker or deeper on cutting taxes on work by raising taxes on income from assets, such as property, dividends and capital gains,” he said.

John O’Connell, chief executive of the Taxpayers’ Alliance, welcomed the proposals, saying: “With taxation running at record levels, tax cuts can’t come soon enough.

“Instead of waiting for a general election giveaway, ministers should get on with meaningful tax cuts now.”

be that a house, a sugar-free diet coke or a pack of cigarettes. Other groups are doing similar work; and it is only if those organisations are able to ‘roll the pitch’ for Hunt and Sunak that they’ll get away with a tax cut which will make the public finances look a little shakier in the short-term but give the economy a desperately needed boost. In short, we need our politicians to show courage and conviction: an interesting idea.

WHAT THE OTHER PAPERS SAY THIS MORNING

UKRAINE-RUSSIA

PRO-NAVALNY

WAR:

PROTESTERS

DETAINED IN MOSCOW

Supporters of jailed Kremlin-critic Alexei Navalny who gathered to call for his release on his 47th birthday have been arrested by Russian authorities. Navalny is serving nine years in prison.

THE GUARDIAN THAMES WATER ACCUSED OF ‘FLIMSY PR STUNT’ OVER BONUS AS CEO’S PAY SWELLS Thames Water is preparing to announce its CEO is landing a £1.5m package, nearly double her annual salary, despite her saying she would shun the bonus amid criticism of water companies.

THE FINANCIAL TIMES

INDIA BLAMES TRAIN CRASH ON SIGNAL FAILURE AS DEATH TOLL NEARS 300 Indian authorities said preliminary findings showed a signal failure caused a train accident that killed 300 people on Friday, as prime minister Modi vowed to punish those responsible.

Hunt hopes to boost staff retention with share reforms

CONTINUED FROM PAGE ONE

The intention behind the programmes are to amplify employee motivation and strengthen ties to their employer, hopefully raising staff retention and boosting productivity.

They are targeted at low earners who often lack the resources to build up a portfolio of assets to strengthen their long-term financial health.

Research carried out by HMRC also shared with City A.M. found 81 per cent of firms that participated

in the employee share schemes say they have fortified their business. Almost three in four said they helped retain and recruit staff.

Half of the companies surveyed by the taxman said they took advantage of the ownership scheme “to create a feeling of ownership among their staff”.

Victoria Atkins, financial secretary to the Treasury, told City A.M.: “Employee share schemes are an effective way to boost motivation in workforces by giving people an extra stake in what they do – and they offer a boost for business.”

THE DAILY TELEGRAPH

CBI’s ex-DG mulls legal action over speedy dismissal

JESSICA FRANK-KEYES

THE FORMER director-general of the Confederation of British Industry is considering suing the scandal-hit lobby group after he was dismissed from the top job as the group became embroiled in a sexual misconduct scandal.

Tony Danker, who was removed in April, is said to be receiving legal advice about filing a potential claim against the CBI, according to the Sunday Times, after he was accused of workplace misconduct.

Danker and a young female colleague reportedly bonded after an office session at Lucky Voice in Soho in winter 2021, and had exchanged messages joking about their favourite songs, the report surmised.

She went on to make a complaint about him after he told her something to the effect that he had had a dream about them singing karaoke together.

The exact wording is said to be disputed, the report said.

The CBI was contacted for comment. City A.M. was unable to contact Danker, but he has previously apologised saying

he was “truly sorry” for making colleagues “feel uncomfortable”. However, he has also said he was made “the fall guy” for the wider sexual misconduct scandal at the group.

The CBI is now fighting for survival ahead of an extraordinary general meeting on Tuesday, where members will decide on the organisation’s future.

While many companies have left the group, some remaining firms are said to be shoring up support for the group in advance of the confidence vote.

Siemens was leading a last-ditch attempt this weekend to save the group, encouraging remaining members to sign a letter urging them to publicly endorse its survival, Sky News reported.

“At a time when the UK economy is facing strong economic headwinds and anaemic growth, and with a general election expected before the end of next year, it is vital that there is a credible voice representing all sectors and sizes of UK business,” the letter, seen by Sky News, said.

New CBI chief Rain Newton-Smith said the lead-up to tomorrow’s vote was “nerve-wracking.”

It won’t be going down well in CBI headquarters that the day before a crunch vote on its future as Britain’s biggest business body, one of its key rivals - the British Chambers of Commerce - has announced a new ‘business council’ of senior figures to give it some additional heft. Make no mistake, the chambers are gunning for the CBI’s seat at the table. Others, including the nascent BizUK - run out of WPI Strategy - are also jockeying for position. Will they be able to replace the CBI? That will depend not on the business group’s members, nor on the efforts

ANALYSIS

(considerable though they are) of the BCC or BizUK. It’ll come down to Britain’s politicians. Right now, CBI staff are personae non gratae with both the Tories and Labour - which is unhelpful, to say the least, as a lobbying outfit whose key selling pitch is access to senior decision makers. The problem for the CBI is twofold; one, the historic animus between some in the Tory party and the body over Brexit and two, the power of the herd. There is little that

can be done about the former unless high-profile members rally round new CEO Rain Newton-Smith and force Downing Street’s hand; but who is going to be first to stick their head over the parapet for an organisation still mired in misconduct claims, taking on the media round to explain why?

Tomorrow’s one-member, one-vote is unhelpfully shrouded in mystery, with no plans to release either the overall result nor which members backed the body’s new change agenda. The odds suggest the CBI will win that vote, but that’s only the start of the body’s fightback. AS.

UK firms mull ‘onshoring’ supply chains to dodge soaring costs

JACK BARNETT

SNAGS in international supply chains lingering on from the Covid-19 pandemic are steering mid-sized businesses toward bringing their production lines back to the UK, a new survey out last night showed. Research by consultancy BDO found just under 50 per cent of the 500 firms they surveyed are considering “onshoring” as much of their operations as possible in the next year.

The move is being driven by 77 per cent of firms running into higher costs throughout their international supply network.

“Onshoring” is the process of moving as much of a business’s supply chains as possiblewithin national borders.

“While the Covid-19 pandemic and Brexit have fallen out of the limelight somewhat, the supply chain pressures we’ve seen over the past few years are far from easing,” Ed Dwan, a partner at BDO, said.

YESTERDAY Sikhs from across the UK took part in a rally in London to mark the anniversary of the Indian state army’s 1984 attack at the Golden Temple in Amritsar. There are no official figures, but Sikhs estimate thousands were killed in the violence.

AMRITSAR UK’s Sikh community rally in the City to mark 39 years since the massacre

Retailers call for rethink on net zero ‘grocery tax’ to prevent price rises

JESSICA FRANK-KEYES

TOP RETAILERS have urged the government to rethink plans for green levies to fund the recycling of food packaging due to costs. The British Retail Consortium (BRC) has warned the ‘net zero grocery tax’ could push up shopping bills by £4bn a year or £140 a year per household, in a letter to the

Sunday Telegraph.

BRC chief executive Helen Dickinson said: “A raft of new regulations will burden retailers – and ultimately consumers – with higher costs.

The BRC’s call was echoed by Tories including Jacob Rees-Mogg, who said: “If this is our approach to net zero, our voters will punish us harshly”.

It comes as polling reveals two in three voters believe Brexit has played a

role in soaring food prices and inflation. Researchers found 62 per cent of Brits think Brexit has negatively affected the cost of groceries, according to the i newspaper and BMG Research. Separately the Food and Drink Federation linked Brexit factors to increased prices, citing “friction at the UK’s borders and persistent labour shortages”.

Turkish retailer makes £1bn bid for troubled Asos

LAURA MCGUIRE

A TURKISH retailer backed by Chinese ecommerce giant Alibaba has reportedly made a £1bn takeover bid for Asos.

Trendyol, an up-and-coming fast fashion retailer, is understood to have approached Asos in late December, when the brand was facing dwindling sales and operational changes, according to a report in The Sunday Times.

The reported deal would value Asos at between £10 and £12 a share, the report said.

The Turkish platform, which launched in 2010, is said to have been working with Morgan Stanley to make the offer, and has also approached one of Asos’s leading investors, Danish billionaire Anders Povlsen, to see if he would be interested in participating in the deal.

Asos was a success story during the pandemic, enticing bored consumers stuck at home to splash out on its clothing, tripling its half year profits to £106m in 2021.

At the height of its success, Asos also beat off a number of top bidders, including Mike Ashley for Philip Green’s crum-

bling Arcadia empire, which included high street darling Topshop.

The £330m acquisition showed investors the power of not only Asos but also the digital shopping space as the future of brick-and-mortar retailers hung in the balance mid pandemic.

But fast forward two years and Asos has disappointed the markets through a series of unfavourable financial results – most recently a £75m cash call from investors to repair its balance sheet.

In the background, Jose Antonio Ramos Calamonte is spearheading efforts to turn the retailer around, who last year launched a “driving change” initiative to repair the group’s finances, which included reduced markdowns and new discipline on “marketing spend”.

But the market is yet to see the results of this turnaround plan, with Asos booted out of the FTSE 250 last week as its shares fell to a 12-month low.

Asos’s shares traded between £6.79 and £4.86 in December, but shares were at £3.50 when markets closed on Friday last week.

City A.M. has approached Asos and Trendyol for a comment on the bid.

time’: Paramount Retail on the hunt for struggling firms

‘Feeding

LAURA MCGUIRE

A BUSINESS group that rescued upmarket chocolatier Montezuma from collapse has said it is looking to continue on its acquisition spree –noting the current tough trading climate is “feeding time” for stronger players in the market.

“In recent years, there have been so many distressed businesses that we have been able to pick the ones that fit in with the profile of the group,” Paul

Taylor, chairman of Paramount Retail told The Sunday Times.

The business, which is owned by brothers Ravi and Sunny Sharma, bought Montezuma for around £1m after it filed for administration a few weeks ago.

Paramount also bought a number of pet accessories businesses and told the outlet it was looking at ramping up its acquisitions before it goes public.

City A.M. has contacted Paramount Retail for a comment.

Montezuma, which is sold in Waitrose and John Lewis, was facing high operational costs

UBS considering results delay after CS takeover

MRINMAY DEY

UBS IS considering delaying its quarterly results at least until the end of August, as the Swiss banking giant deals with the complexities over its takeover of Credit Suisse, the Financial Times reported yesterday.

The bank is scheduled to report its April-June results on 25 July.

A notice on the bank’s website says the anticipated date may change.

“Publication date may change depending on the timing of the closing of the anticipated acquisition of Credit Suisse,” the notice says.

UBS didn’t immediately respond to a request for comment on the report.

Executives at Switzerland’s biggest bank are weighing up delaying the publication of results along with an update on the plans for Credit Suisse’s domestic business, the

BUILDING UP FAST Deloitte adds to real assets push with four senior City hires

Paragon Bank set to cash in on rate rises

CHRIS DORRELL

PARAGON Bank is set to post another strong set of results this week as analysts expect the lender to benefit from rising interest rates.

report said, citing people familiar with the matter whom the newspaper did not name.

UBS, which agreed in March to take over its smaller rival as part of a rescue orchestrated by Swiss authorities, has said it aims to close the deal quickly.

Chief executive Sergio Ermotti last week warned of painful decisions about job cuts following the takeover which he said he hoped would be formalised in the coming days.

UBS has said previously that it is set to make a $35bn (£28bn) gain from the takeover. This is much lower than was originally forecast, however, as it warned that it will take a $17bn hit from costs related to asset write-downs and litigation provisions.

Reuters

Asset managers must do more to tackle climate crisis, report warns

REBECCA SPEARE-COLE

MAJOR asset managers must do more to safeguard the world’s ecosystems and tackle the climate crisis, campaigners have warned.

A report from Shareaction, which campaigns for responsible invest-

ment, assessed 77 of the largest asset managers in the world, including UK firms like Legal & General, HSBC, Aviva, Fidelity and Schroders. It said only 10 asset managers – all in Europe – had committed to restrict investment in the most harmful fossil fuels across all their funds.

The FTSE 250 bank, which specialises in providing finance to buy-to-let landlords and SMEs, had a solid 2022 and looks set to repeat the strong performances of other major UK lenders when it reports its halfyear results on Tuesday.

Domestically-focused banks in the FTSE 100 beat expectations with their results for the first quarter, although some signalled more difficult times ahead.

“The Big Five are predicting a ‘normalisation’ of loan losses for this year and it will be interesting to see if Paragon does the same,” AJ Bell’s Russ Mould said.

However, Paragon takes a fairly conservative approach to lending and so investors expect it to be well insulated from any problems that do emerge.

Mould also pointed out that “the bank is well capitalised and currently confident enough to be running a share buyback”.

DELOITTE has added four new senior staff to its real assets advisory team, a key part of the firm’s growing real estate and infrastructure offering. Hari Sothinathan joins from Gerald Eve, Michelle Kite from Grosvenor Property, industry vet Andrew Stanford from working on the government’s build-to-rent sector and Jane Lees from CBRE.

UBS chief executive Sergio Ermotti PA

AN UNRIVALLED DAY ON THE GREENS

The Carrick Golf Course at Cameron Golf Club

A stunning 18-hole championship course beside the glistening waters of Loch Lomond awaits. Arguably, the country’s most breath-taking round set against majestic highland backdrops. Located just 3 miles north of Cameron House Resort, The Carrick Golf Course is an enjoyable challenge for every level of golfer.

EXPLORE GROUP GOLF EXPERIENCES

Our golf day packages includes food, on-course branding, pre-round golf clinics by our team of PGA Professionals, and a PGA Professional host for the day. VIP locker-room service is also included, along with shoe and club cleaning and corporate gifts.

House price growth set to stutter as rate hikes shut out prospective buyers

JACK

BARNETT

HOUSE price growth is poised to stutter, new figures out this week are expected to show, as prospective homeowners are gradually priced out of the market by the Bank of England’s successive interest rate rises.

Numbers from Britain’s largest mortgage lender Halifax on Wednesday are set to show house prices grew around 0.6 per cent over the year to May, down from a growth rate of 1.6 per cent in the previous month.

For the month of May, house price rises are tipped by consultancy Oxford Economics to have stalled completely, signalling the Bank’s efforts to cool the UK economy to grip price pressures are

taking effect.

“The latest numbers for house prices, mortgage lending and housing transactions suggest that the toll higher rates are taking in that sector is rising,” the group said in a note.

Inflation is proving much tougher to eradicate than experts expected. Numbers from the Office for National Statistics last month revealed the rate of price increases slimmed to 8.7 per cent from 10.1 per cent, a much smaller drop than was forecast.

Core inflation, however, jumped

SPORT

Tongue is in the Ashes squad and could find his second-ever start to be in cricket’s biggest series

from 6.2 per cent to 6.8 per cent.

Bank governor Andrew Bailey and co have jacked up borrowing costs 12 times in a row to 4.5 per cent, and financial markets expect the Bank to send them to 5.5 per cent. Those hikes have raised mortgage rates, forcing more potential buyers to park their homeownership dreams for the time being. Research from the Royal Institute of Chartered Surveyors on Thursday is anticipated to show higher mortgage costs are squeezing demand in the housing market.

A NEW SOBERING REALITY Craft breweries are being battered by soaring operational costs and an over-saturated market

OVER the last year the number of beer factories going under tripled, new figures out from audit, tax and advisory firm Mazars reveal. Mazars blame rising overheads and an oversaturated market for the rise.

Craft brewers are now in the same spot as the UK’s pub sector, also battling hikes in energy and operational costs that have left many facing an uncertain future.

Trade union boss brands Labour’s plans to wind down North

JESSICA FRANK-KEYES

LABOUR’s plans to wind down oil and gas production in the North Sea have been branded as “naive”by one of the UK’s top trade union chiefs.

The proposals, confirmed by Labour leader Sir Keir Starmer last week, would ban new licences for oil and gas extraction in the North Sea but still allow existing projects to continue until 2050 under the party’s green energy transition plan.

“There is a lot of oil

Sea oil and gas as ‘naive’

and gas in the North Sea and the alternatives facing the country are that we either produce our own – take responsibility for our carbon emissions – or we are going to import more,” GMB general secretary Gary Smith told Sky News

“I think workers in the petrochemical industry… are going to be very worried about what Labour are saying, and I

think it is time for Labour to focus on the right thing rather than what they think is the popular thing.” He said that the sector had been promised “tens of thousands of jobs” in renewable energy “time and time again” but that the positions “simply have not emerged”. Shadow business secretary Jonathan Reynolds defended the plans, however, telling the BBC that North Sea energy extraction would continue until at least 2050, protecting 28,000 jobs. He added: “But the big opportunity comes from the transition and we don’t think further new oil and gas fields are the answer.”

UK falls behind rivals on micro mobility rules

EXCLUSIVE

GUY TAYLOR

DELAYS to legislation covering electric bikes and scooters are preventing manufacturers and operators from expanding in the UK, and could even see them leave the British market altogether if new rules aren't passed soon, the government has been warned.

Julian David, chief executive of trade association Tech UK, has called on the government for regulatory certainty in order to increase the production of ebikes and e-scooters in the UK.

“We are now rapidly losing pace as the EU has already taken steps to legalise e-scooters and is drafting blocwide cargo bike regulations to come into effect from next year,” David said in a letter to transport secretary Mark Harper, seen by City A.M. David

warned that a "split-regulatory model between the UK and EU will hinder the ability of manufacturers and operators to scale, resulting in many UK operations winding down or ceasing altogether." The UK is currently the only country in Europe not to have moved forward with formal regulations outlining how and where passengers can use micro-mobility technologies.

E-bikes and e-scooters are currently allowed on the roads under an ongoing government trial launched in 2020, but the path towards permanent legality has not been made clear.

Hal Stevenson, e-scooter group Lime's senior public affairs manager, told City A.M. that the ongoing trail shows escooters "can safely deliver sustainable transport options in towns and cities across the UK".

The London-listed carrier has seen passenger number increases in recent months

Wizz Air to report huge loss but smoother flight path lies ahead

GUY TAYLOR

ANALYSTS expect Wizz Air to report a net loss of nearly half a billion pounds on Thursday as soaring jet fuel costs weigh the budget airline down. Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said while a strengthening euro offered some relief to rising fuel costs, “these still rose by north of 60 per cent last quarter, leading the group to expect

Addison Lee hit by Sadiq Khan’s anti-car policies

GUY TAYLOR

ADDISON Lee’s chief executive Liam Griffin has hit out at Sadiq Khan arguing that his policies, such as the congestion charge and expansion of ULEZ, are hurting the firm’s drivers. Griffin told Bloomberg that there has been “an agenda to slow London down rather than speed it up.”

“When you look at bus lanes, when you look at cycle paths, you look at the Strand, you look at local neighbourhood measures, and none of this is car-friendly,” he said. “We have definitely been victims of that, and our drivers struggle to get around and it means their earning potential is less than it should be.”

an overall net loss in next week’s results”.

But analysts said it was not all doom and gloom for Wizz Air.

Conroy Gaynor, an aviation analyst at Bloomberg Intelligence, said that although “heavy losses” are expected, Wizz Air may have reached a “turning point.” “Peers are showing strong bookings –and a decline in jet fuel prices renders costs more manageable,” Gaynor said.

Khan has faced a growing backlash over his decision to expand the Ultra Low Emission Zone (ULEZ), which is aimed at reducing car pollution in the capital.

A spokesperson for Khan said he was “determined to build a fairer, greener and more prosperous London for everyone and will continue to improve transport in our city, which includes promoting safe and environmentally-friendly forms of travel to help tackle air pollution, the climate crisis and congestion.”

Investors hope BAT vape sales are on the up

INVESTORS will be hoping Lucky Strikemaker British American Tobacco (BAT) has stubbed out historic misconduct issues and is cashing in on its pivot to vapes and e-cigarettes.

The FTSE 100-listed giant will give an update on its progress with a new boss at the helm when it unveils its trading update on Tuesday.

The world’s second-biggest tobacco firm promoted its finance director to the top job as chief executive last month, after a 30-year career at the business.

Tadeu Marroco took over from Jack Bowles amid a push towards new vaping and tobacco alternatives, which account for about £3bn of its revenues.

“As it becomes harder to squeeze growth from the traditional tobacco portfolio,

THE DERBY ON TOUR Epsom welcomes Kentucky’s trophy for festival weekend

Jacamo owner crosses fingers amid sales glut

LAURA MCGUIRE

focus on the performance of the new categories division will continue to heat up,” Matt Britzman, equity analyst for Hargreaves Lansdown, said.

“Profitability in this area is the next major milestone, now expected in 2024, earlier than initially expected.”

Sales of so-called next generation products are expected to grow by nearly a quarter in 2023 to more than £3.5bn, according to analysts at AJ Bell.

Thousands of staff could lose their job as it pivots toward new technologies and trims down the old side of the business, BAT said earlier this year.

The update follows the firm reporting an annual adjusted operating profit of £12.4bn in February, and paying $635m (£512m) to US authorities for breaching sanctions relating to North Korea.

INVESTORS in online retailer N Brown will be looking for signs of recovery in its full year results this week, after the firm paid out a hefty legal settlement and has struggled amid a broader slowdown in consumer spending.

N Brown, which owns brands such as Simply Be and Jacamo, reported a 7.6 per cent dip in revenues to £249.2m in the third quarter amid a slowdown in consumer spending amid the cost of living crisis.

It also handed £49.5m to Allianz insurance to settle a long-running dispute over its insurance products.

At the time, chief Steve Johnson warned that he expected to attract less customers over the next year due to a tough trading environment, describing the market as “soft”.

But the Manchester-headquartered retailer did not follow up its October profit warning with another one in January.

“Johnson reaffirmed his faith that the firm could meet the analysts’ consensus profit forecast of £57.5m,” Russ Mould, investment director at AJ Bell, said.

ANNA WISE

THE KENTUCKY Derby trophy made its way to Epsom racecourse, home of its namesake and inspiration, for the two-day racing festival in Surrey over the weekend. The US’s most famous horse race celebrates its 150th anniversary next year. The Epsom Derby went off mostly smoothly, despite fears of protests.

Tadeu Marroco took the top job last month

THE NOTE BOOK

Spoiler alert: It’s grit that’s lacking in final Succession ‘winner’

AFTERfive days of ‘spoiler alert’ dodging, I settled down to watch the finale of Succession this weekend. Having caught the odd review headline, I was poised for something special. And yet … Why did I find the ending just a bit disappointing?

The answer, of course, is simple: It Should Have Been Shiv. Tom’s coronation was probably more poetic and maybe even more dramatic. But for Waystar Royco and its new owners GoJo, he was absolutely the wrong choice.

Consistently throughout the show it was Shiv who proved herself best able to navigate a crisis, to think differently and clearly, and –more importantly –who demonstrated that critical CEO quality … Grit.

RAIN’S TOUGH WEATHER

Pregnant, grieving and in the midst of a messy separation, Shiv was the only cast member who was always able to push aside the emotions and act strategically. That is until the scriptwriters decided to take a U-turn towards Tom –a character who, until that point, had shown himself to be middle-management material at best. And therein lies a lesson for corporate Britain as it continues to underperform in recognising the strength of female leadership. If it is grit that matters most –that ability to cut through the clutter and manage the tough stuff –then leadership equality must come faster. That 90 per cent of CEOs of Britain’s largest public companies are men is, in the considered words of Logan Roy, “a f****** disgrace”.

In my view it’s not just because of the particularly unsavoury nature of the allegations engulfing the CBI that the organisation has turned to the impressively calm Rain Newton-Smith in its moment of existential crisis. She’s been called in to take on this particular reputational rescue mission because she has the rare combination of empathy and steel that’ll be essential to save the 60-year-old institution from the mess her (male) predecessors created. All power to her elbow as she tries to pull the CBI back from the brink.

£ A piece of Monday advice from secretary of state for levelling up, Michael Gove. I talked to Michael last week about all things crisis and he had this gem to offer: “The first thing is, if you’re going to make a big announcement you shouldn’t do it on a Monday .. you need to have that full working day immediately beforehand to rehearse, to make sure that you’ve got everything absolutely right. Coming out of the weekend straight into the Monday –tiny thing, big risk.”

£ Watch out for our next episode with broadcaster Aasmah Mir, who now co-hosts The Times’s breakfast show. She’s a woman who, after enduring a childhood of racism and other traumas, suddenly found herself as a single mum with a new job that required a 3am alarm call. Anyone wanting to learn more about the power of female grit should read her brilliant new book A Pebble in the Throat.

A TESTAMENT TO PERSEVERANCE

Baroness Martha Lane Fox, for me, provides the ultimate case study that exposes the characterisation of grit as a mostly male quality, as being well wide of the mark. One of the first guests to join me on my podcast Crisis What Crisis, Martha told the story of her rise to success with Lastminute.com against a backdrop of misogyny, being ignored in investor meetings and suffering the focus of some pretty sexist media coverage when the business hit a low. But it was her story of recovery, following the 2004 car accident that almost claimed her life, which ultimately proved Martha to be the Goddess of Grit. She told me: “I do think that’s one of the things about crisis, to just keep going. You may not know what that one step in front of the next step –which for me was quite literal – will be but … just keep going.”

I was lucky enough to see Martha speak at a London conference just a few weeks ago, now knowing that just getting onto a stage is an allconsuming exercise in pain control for her. She delivered yet another brilliant, funny and inspiring performance to a roomful of HR execs. The best possible recruitment advert for the power of female leadership.

Where interesting people say interesting things. Today it’s Andy Coulson, former journalist, politico and now PR agency boss

THEInternational Energy Agency is predicting a bumper year for renewables –with generation capacity worldwide to jump by a third in 2023 alone – rising to 4,500GW, enough energy to power mega consumers China and the US combined.

The lion’s share of this increase will be driven by solar power, around two-thirds in total, which is being embraced on both an industrial scale and also by savvy households turning to cheap, clean energy over ultra-expensive gas, which climbed to record highs following Russia’s invasion of Ukraine last year.

In its latest monthly report, domestic industry certifier MCS tells us that while the various rows over onshore wind turbines and delayed nuclear power plants have dominated column inches, a rooftop revolution is taking place in the UK.

Encouragingly, households are truly embracing solar power with a record number of sub-50-kilowatt systems installed in March –totalling 17,595 in all, or 568 per day.

If the current pattern of growth continues, about 230,000 installations will be made in 2023, which will raise the number of solar panels on roofs from 1.24m to 1.47m across the UK.

This is great news, and reflects that solar is cheaper than ever, with a household currently able to set up a solar panel system for as little as £5,000.

Money Saving Expert now predicts a payback time of under a decade for average consumers.

There is support for solar panels with a handful of government grants – such as the Energy Company Obligation scheme, aimed at supporting low-income households with subsidies for renewable obligations.

Separately, the Smart Export Guarantee (SEG) requires suppliers with 150,000 plus customers to pay homeowners for any unused solar-generated electricity. This means you can earn money back once you've installed solar panels, increasing the rate of return on investment.

Last year, the government also announced households would be able to pay zero per cent VAT on any installed energy-saving products including solar panels, electric heat pumps and cavity wall insulation.

Meanwhile, the push factors of Russia’s invasion of Ukraine and the domestic supplier crisis, which helped drive energy bills to record heights, are both ongoing.

Yet all these measures are not enough when the government is targeting 70GW of solar power generation by 2035 – 20GW more than ambitions for overall offshore wind capacity.

HERE COMES THE SUN: OUR LITTLE DARLING?

Much of this heavy lifting to reach our solar power targets will be done by large-scale sites, alongside installations on public buildings, with the government last week setting up a taskforce to place solar panels in schools, warehouses and car parks. However, smaller installations from households, shops and local businesses will also be key to reaching this target – with the UK not even a quarter of the way there (current generation is 17GW across the country).

Frankly, with such

particularly when it comes to policies within our reach like installation subsidies, enhanced planning and skills training. For example, industry body Solar Energy UK has encouraged the government to mandate solar panels on new builds, but also called for supply and expertise to stay level with rising demand. Chief executive Chris Hewett said: “There are three things that the government could do right now to build on the momentum of rooftop solar for households. First off, ensure that the future home standard effectively requires all new build homes to have a solar roof. Secondly, offer loans or grants to install solar and batteries in lowincome households. Finally, add support for national skills and training programmes, like the Solar Skills scheme run recently by the mayor of London.”

Oil prices to rise after Saudi Arabia announces deep production cuts

MAHA EL DAHAN

SAUDI Arabia will make deep production cuts in July as part of a broader output-limiting OPEC+ deal as the group faces flagging oil prices and a looming supply glut.

Saudi Energy Minister Prince Abdulaziz said the cut of 1 million barrels per day (bpd) by Riyadh could

be extended beyond July if needed.

"This is a Saudi lollipop," he said. OPEC+, which groups the Organization of the Petroleum Exporting Countries and allies led by Russia, reached a deal on output policy after seven hours of talks and decided to reduce overall production targets from 2024 by a further total of 1.4 million barrels per day.

However, many of these reductions will not be real as the group lowered the targets for Russia, Nigeria and Angola to bring them into line with their actual current production levels.

OPEC+ pumps around 40 per cent of the world's crude, meaning its policy decisions can have a major impact on oil prices.

a 315 per cent increase in demand for installers over the last three years.

By the next decade, Solar Energy UK is forecasting that 60,000 people will be employed within the solar sector – up from the 7,000 recorded back in 2020.

DEMAND ON THE RISEBUT CAN SUPPLY KEEP PACE?

But with roughly 23m homes still bereft of any rooftop insulation, even more experts will be needed to meet rising customer demand.

Another hurdle is planning and grid connections for smaller scale installations on shops and businesses that don’t have the same rights as households but want similar set-ups.

Adam Bell, ex-head of energy at BEIS, argues that when it comes to installations,

He said: “The government took a step forward earlier this year through new rights for non-domestic properties. However, there are still barriers to installing solar domestically depending on the size of the installation and local grid companies' ability to service bigger installations.”

Funding, skills and planning are challenges we can resolve – and with other factors likely to emerge in the coming years such as securing key minerals like copper, cobalt and nickel, and bolstering supply chains, it is vital that issues in our control are dealt with If the UK wants to embrace a rooftop revolution it needs to act now, harness the growing enthusiasm of the British public and carry the momentum through to meet our supply security and net zero goals.

OPEC+ met in Vienna yesterday amid a background of slumping oil prices

Solar Energy UK boss Chris Hewett

Erdogan’s new finance boss: Turkey must return to ‘rational ground’

NEVAT DEVRANOGLU

TURKEY’S newly appointed finance minister Mehmet Simsek said on Sunday that the country has no choice but to return to "rational ground" to ensure predictability in the economy. President Tayyip Erdogan named Simsek to his cabinet on Saturday to tackle Turkey's cost-of-living crisis and other strains, in a clear sign that his newly elected government would return to more orthodox economic policies.

In a handover ceremony, Simsek said the main goal of the new government will be to increase social welfare.

"Transparency, consistency, predictability and compliance with international norms will be our basic principles in achieving this goal," Simsek said.

"Turkey has no other choice than to return to a rational ground. A rules-based, predictable Turkish economy will be the key to achieving the desired prosperity."

Ukraine seeks ‘silence’ on its counter attack

DAN PELESCHUK

THE Ukrainian military on Sunday renewed its plea for operational silence around a long-awaited counteroffensive against Russian forces, the latest in a stream of messages by Kyiv as it prepares for the assault.

Anticipation has mounted around what is expected to be a broad attack by Ukrainian forces to retake Russianoccupied territory in the east and south.

But Ukrainian officials have repeatedly discouraged public speculation about the operation, saying it could serve to help the enemy.

Authorities in recent days have also cracked down on citizens sharing images or footage of air defence systems shooting down Russian missiles.

"Plans love silence. There will be no announcement of the start," the ministry said in a video posted to official Telegram channels, apparently referring to the counteroffensive.

The sleekly-produced footage featured masked and wellarmed frontline troops holding their fingers

against their lips, gesturing for silence amid the distant rumble of artillery and gunfire.

It ended with images of soaring F-16 fighter jets –long coveted by Kyiv as it seeks to boost its air defence against Russian missiles and drones.

Kyiv's Western allies in recent months have provided weapons, armour and ammunition for the counteroffensive, which military experts have said could prove difficult against dug-in Russian forces.

In an interview published on Saturday, Ukrainian president Volodymyr Zelenskyy said Kyiv was prepared for the operation but avoided making any predictions.

"To be honest, it can go a variety of ways, completely different," he told the Wall Street Journal. "But we are going to do it, and we are Other senior officials, including defence minister Oleksii Reznikov, have similarly sought to tamp down expectations.

Simsek, who was highly regarded by financial markets when he served as finance minister and then as deputy prime minister between 2009 and 2018, said that lowering Turkey's soaring inflation to single digits will be another priority.

"It is vital for our country to reduce inflation to single digits again in the medium term, to increase predictability in all areas, and to speed up the structural transformation which will reduce the current account deficit," he said.

ANOTHER BAN Hong Kong authorities replace annual Tiananmen Square vigil with pro-Beijing ‘carnival’ in city’s Victoria Park

Biden puts default drama behind him with weekend ceiling signing

TREVOR HUNNICUTT

PRESIDENT Joe Biden on Saturday signed a bill that suspends the US government's $31.4trn (£25.2trn) debt ceiling, averting what would have been a first-ever default with just two days to spare.

The House of Representatives and the Senate passed the legislation this

week after Biden and House of Representatives speaker Kevin McCarthy reached an agreement following tense negotiations.

The Treasury department had warned it would be unable to pay all its bills on Monday if Congress had failed to act by then.

Biden signed the bill at the White House a day after hailing it as a

bipartisan triumph in his first Oval Office address to the nation.

The bill signing, which was closed to the press, marked a low-key, symbolic end to a crisis that vexed Washington for months, forced Biden to cut short an international trip in Asia and threatened to push the United States to the brink of an unprecedented economic crisis.

The controversial Recep Tayyip Erdogan won a third term as Turkish president

HONGKONGERS were banned from marking the anniversary of the Tiananmen Square massacre for the fourth year in a row this weekend, with the city’s main park taken over by a Beijing-backed fair. Some estimates suggest that 10,000 individuals were killed as a result of the 1989 protests, during the protests and in a post-protest crackdown. A vigil was hosted in Taiwan’s capital Taipei.

Ukrainian president Zelenskyy is set to launch a summer counter-attack

CITY DASHBOARD

YOUR ONE-STOP SHOP FOR BROKER VIEWS AND MARKET REPORTS

LONDON REPORT BEST OF THE BROKERS

email your research to notes@cityam.com

HOUSE PRICE SHENANIGANS

New PMI data could crystalise market bets on continued rate rises

PMI data from S&P Global and the Chartered Institute of Procurement and Supply today could crystalise market bets on the Bank of England continuing to raise interest rates.

The final purchasing managers’ indexes will alarm economists at Threadneedle Street if they confirm that strong wage inflation is contributing to service providers seeing the fastest rise in their cost burdens for three months, analysts at Oxford Economics said.

“A similar outcome in the final survey for May would further increase the likelihood of the Monetary Policy Committee going for another rise in interest rates when it meets later this month,” they added. The services PMI is tipped to stay far above the 50-point growth threshold at 55.1. Manufacturing output is lagging

far behind services activity, mainly due to the sector being more sensitive to interest rate changes and weak international demand.

While inflation fell from 10.1 per cent to 8.7 per cent last month, core inflation jumped from 6.2 per cent to 6.8 per cent. The Bank has now hiked rates to 4.5 per cent, and financial markets expect Bank governor Andrew Bailey and co to send them to 5.5 per cent.

Pound sterling last week was on track to clock its best week against the US dollar in around six months, strengthening about 1.5 per cent, driven by investors hiking their peak interest rate expectations, though that run lost steam on Friday.

London’s FTSE 100 fared okay, adding around half a percentage point last week to finish at 7,607.29 points. The mid-cap FTSE 250 pumped up 1.71 per cent to 19,149.31 points.

First Group is set to see operating profits of £144.4m this week, after analysts upgraded their 2023 full year estimates in March on the back of strong demand. Since then the loss of the TPE rail franchise in May will affect 2024 forecasts but Peel Hunt expects “a further recovery in bus margins and the benefits of the continuing government support”. Analysts maintained their ‘Buy’ rating.

VISIT:

Wizz Air is set to report big losses this week in its full year results, with last year's supply chain issues and soaring jet fuel costs made worse by low levels of hedging. But Peel Hunt analysts think “the sharp decline in jet fuel price in the last few months” should help the carrier. A jump in traffic figures will also help the firm.

Peel Hunt kept its ‘Buy’ rating.

“Leading the docket will be the Halifax house price index on Wednesday. Any further signs of stress in the mortgage market knocking housing demand could contaminate shares in home builders, like Persimmon and Barratt. ”

JACK BARNETT ECONOMICS EDITOR

Powerful real-time thought leadership, insights and news delivery mechanism fuelling the most up-to date reporting, adding critical context for decisions that require consciousness, education and thought leadership.

JOIN THE CONVERSATION AND BECOME A PART OF ONE OF LONDON’S MOST TRUSTED NEWS SOURCES

CITYAM.COM/IMPACT-AM/

OPINION

EDITED BY ELENA SINISCALCO

The Covid-19 inquiry should be a battle for Johnson, not for the Cabinet Office

messages and emails can be deleted, paperwork can be destroyed and memories can become suddenly unreliable. Johnson said he had handed over everything, but Dilyn, the Johnsons’ dog, probably has the same attitude to homework that, proverbially, all dogs do. So there may be critical pieces of evidence already lost.

WHERE to start? Baroness

Hallett, the chair of the public inquiry into Covid19, demanded last week that the Cabinet Office provide her with WhatsApp messages between Boris Johnson, the former prime minister, and his advisers, as well as his contemporaneous notebooks and diaries. While Johnson indicated his willingness to cooperate, the Cabinet Office, the inquiry’s point of contact in Whitehall, refused.

Hallett set a deadline of 4.00 pm last Thursday. It expired and the government issued a statement announcing it would seek a judicial review of the inquiry’s request, arguing that it included material irrelevant to the inquiry’s scope. The disclosure of such material could inhibit ministers freely discussing policy in the future, for fear of “fishing trips” for confidential information by future inquiries.

This will not do. The Cabinet Office has picked the wrong hill on which to die, and is wrong in principle and in political reality.

Potential witnesses to the inquiry have two sets of legal representation, their own and that of the Cabinet Office. For serving ministers, each department may also have a legal view on the extent of disclosure. So wit-

nesses could be placed in an invidious position, personally content for documents to be disclosed but frustrated by the stance of the Cabinet Office. They may oppose the judicial review, but are powerless to stop it. And they risk being seen as in cahoots with the Cabinet Office. One foolishness of the Cabinet Office’s position is that it was always in vain. Boris Johnson had already made it clear he would give everything he had to the inquiry - and he did so, bypassing the Cabinet Office and handing over his WhatsApp messages last

Friday. Still, he didn’t disclose anything from before May 2021, which is an enormous qualification. Many other witnesses are willing to cooperate fully. So Whitehall chose a reputationally damaging attitude for nothing, because the inquiry got the material it wanted in any case. Politics is about knowing which fights to pick. More fundamentally, though, this raises a question of propriety and authority. If there is a dispute over whether data are relevant to the scope of a public inquiry, who is to make that judgement? The Cabinet Office

view seems to be that it should be them, as they’re the controller of the data, but that surely can’t be right. Hallett takes the view that she, as chair, should make the decision, which seems more reasonable, as she retains the power to withhold “irrelevant” material from the public domain. The government believes that the act of disclosing the material is selling the pass, which is worryingly secretive and, worse, suggests it doubts Hallett’s good faith and discretion. A practical issue is that it’s unlikely all the evidence still exists. WhatsApp

We won’t reach a climate solution without all our partners in Asia - including China

IF WE want to have a grown-up conversation about climate change, we must engage the biggest emitters –including China. In the last few weeks, Investment Minister Lord Johnson visited Hong Kong. It was the first visit by a British government minister in five years.

I look forward to visiting Hong Kong later this week, promoting the strong links between our two cities - as well as visiting Japan, Singapore and mainland China. After several years of Covid19 restrictions and political challenges – many of which have not diminished – we are grateful to be able to make these visits in person once again.

Hong Kong is one of the world's leading international financial centres. There are many areas of shared interest with the UK to discuss, including financial regulation, infrastructure investment and sustainable finance.

No one underestimates or ignores the political and human rights differences between the UK and China. But the big global problems facing the world, par-

Nicholas Lyons

operation on climate change will be the main message of my visit to China and Hong Kong.

with the Tokyo Metropolitan Government to help connect the city to London's buzzing fintech ecosystem.

Witnesses should be required to state whether the evidence, oral and written, they provide is complete or partial. That way, at least the inquiry team will know how far it is dealing with known knowns and how far with known unknowns. They should not be distracted by the potential red herrings of extensive redactions: often what’s missing speaks much more loudly than what is concealed. And it should go without saying that witnesses must be absolutely honest and open, however unfamiliar that instinct might be.

The decision of the Cabinet Office to deny Lady Hallett’s request and seek a judicial review is difficult to defend. It demonstrates secrecy verging on paranoia, and a reckless attitude to both the importance and the integrity of public inquiries. One can forgive anxiety at what the Covid-19 inquiry might disclose, but with high office comes high responsibility, and decision-makers must be accountable. The workings of government often require confidentiality, but the families of nearly a quarter of a million people who died in the pandemic deserve to know what happened. This is no longer just a matter of law or procedure: unwittingly, Whitehall made this a moral issue.

£ Eliot Wilson is co-founder of Pivot Point and a columnist at City A.M.

CALIFORNIA

ticularly climate and sustainability, revolve around the biggest polluters and those who are investing most in renewable energy. China is at the top of both of those lists. There is no issue bigger than climate change. Dr Ma Jun, the chair of China's Green Finance Committee, was in London recently for the Net Zero Delivery Summit, discussing the crucial role of international financial services in enabling China and other economies to transition to net zero. China has to be part of the solution - something which the City Corporation has been striving for through the UK China Green Finance Forum. This urgent need for co-

But this is just one part of the City of London’s long-standing relationship with economies in Asia. Japan, where the prime minister recently attended the G7 summit, is one of our most important economic and diplomatic partner - as underlined by the recent Hiroshima Accord on UK-Japan economic, security and tech collaboration.

Japanese firms form an important part of the City of London’s rich global tapestry, employing more than 12,000 people here.

Building stronger ties with Japan will ensure the UK wields its research and development strengths to go even further on cutting-edge chip design and chip fabrication. This will be key in an increasingly digital world where AI technologies are taking centre-stage.

But there is more we can do to bring down market barriers between the UK and Japan, especially in financial services. The City of London is working

In Singapore as well, the historical links with the UK have now been replaced by a modern relationship between two leading global financial centres, each a gateway to their respective continents, and each a hive of innovation and sustainability.

Singapore is an important regional reinsurance hub and has built strong credentials as a centre for dispute resolution where British law firms have a significant investment.

These major Asian economies are all different, and each has its own unique relationship with the UK and the City. We need to keep our lines of trade, investment and communication open with all our partners in Asia. It will enable our financial services to grow our economy, lead in innovation and influence the world.

£ Nicholas Lyons is Lord Mayor of the City of London Corporation

Eliot Wilson

Boris Johnson bypassed the Cabinet Office to hand over material to the inquiry directly

DREAMIN You could argue Rishi Sunak really loves being abroad. After his quick trip to Europe last week, he’ll fly to the US this week to meet with President Joe Biden. They’ll talk about supply chains - likely a reference to Biden’s green subsidies - and support for Ukraine

WE WANT TO HEAR YOUR VIEWS

LETTERS TO THE EDITOR

We

really

need good AI rules

[Re: Let’s be honest, we shouldn’t take those predicting the AI doomsday too seriously, June 1]

The reality is that if left unchecked, generative AI could prove damaging in completely unintentional ways. Sensible regulation is critical – but policy-makers are struggling to know where to start.

Naturally the onus in developing regulation falls onto governments and regulatory bodies, but as the business community will be leveraging the monumental benefits of generative AI, it should also shoulder some of the responsibility for helping develop appropriate guardrails. We advocate for two core principles to be observed as soon as possible. The first one is to only

apply large language models (LLMs) to closed data sets to ensure the confidentiality of all data. The second one is to ensure the development and adoption of generative AI always has a “human in the loop” to maintain accountability and fairness.

These principles will serve as a starting point. But going forward regulation needs to prioritise the most pressing issues – better documentation of processes to prevent bias and safeguard intellectual property, fair labelling and authentication to identify AI-generated content, and restrictions placed on AI models to prevent the technology from becoming uncontrollable. Regulators and the business community working together can ensure that generative AI contributes positively to society while safeguarding against potential risks.

Rohit Kapoor Vice Chairman and CEO, EXL

POTATO SHORTAGE? Potatoes from Northern Ireland in short supply

A healthy motor industry for the UK needs gigafactories like the one Tata will build

TATA, the Indian conglomerate, is expected to announce a new gigafactory in Somerset to supply batteries to Jaguar Land Rover, the company which it has owned since 2008. The government is thought to have provided substantial financial support, including a special deal on energy costs. If this deal is confirmed it will be good news for the hard-pressed British motor industry. Within 3 to 5 years the UK will have two gigafactories; the other is being built in Sunderland by the Chinese company, Envision, to supply Nissan. Two gigafactories are better than one, but Tata’s decision will still leave the UK a long way behind the EU, which has at least 25 gigafactories in operation, under construction or planned. The industry wants more gigafactories and thinks the government is not doing enough to promote them.

When Theresa May launched the Faraday Battery Challenge in 2017, the hope was that the creation of a battery supply chain – including gigafactories, cells, and the other battery components – would encourage the UK-based assemblers (all of which are foreignowned) to make their electric cars in the UK rather than elsewhere. The government also hoped that one of the top Asian battery producers, such as Samsung, might be induced to build a gigafactory in the UK.

That latter hope was disappointed.

EXPLAINER-IN-BRIEF: A BRITISH CIRCUS OF MIGRATION DEALS ALL OVER EUROPE

Not many people would expect to spend their weekend scrolling through Robert Jenrick’s Instagram account. But it was the only way to gather some details about the Minister for Immigration’s trip around the Mediterranean last week. Jenrick went to visit his bestie Giorgia Meloni’s government in Italy, and thanks to social media we know he met with his counterpart Nicola Molteni and went to say hello to the Italian Coastguard. He then went to France to talk about small boats’

crossings through the Channel. Jenrick previously went to Algeria and Tunisia too, offering resources to tackle the “smuggling gangs at their source”. Sunak, in the meantime, struck a deal with Georgia on returning illegal migrants. Looks like the government is trying to extend its jarring “hostile environment” policy all over Europe. Who knows which country will be drawn in some form of collaborative agreement this week?

ELENA SINISCALCO

The Asians preferred to invest in the EU, for the obvious reason that the EU, and especially Germany, had a much bigger motor industry than the UK. That was also where the big buyers of batteries – Volkswagen, BMW and the rest – had their headquarters.

Given the absence of Asian investment, the government was keen to support a homegrown battery startup, Britishvolt, with plans to build a gigafactory at Blyth in Northumberland. But this company, despite winning a provisional grant from the government, was never able to raise the necessary funds, and went into administration at the start of 2023.

The UK will need at least five gigafactories by 2030 to supply the number of electric cars that will be produced in the UK in that year, according to forecasts by the Faraday Institution. But who will build them, and how will they be financed?

Of the four big, UK-based assemblers, Nissan and Jaguar Land Rover have now made their dispositions, assuming the Tata project goes ahead. The other two, BMW and Toyota, have not. Will their volume grow to the point where they can support a UK-based gigafactory? An alternative would be to import cells from a European cell supplier and convert them into battery packs in their UK factories. But the industry has consistently argued that importing cells would add significantly to production costs, compared to supplies from a local gigafactory.

Will the government be prepared to support new gigafactories on the same scale as it has done with Tata? Whatever it decides, it must avoid engaging in a subsidy war with the US and the EU. It should focus on other ways - for example, lower energy costs - of making the UK more attractive for batteryrelated investment.

The government has recently restated its determination to make the UK one of the best locations in the world for the manufacture of electric vehicles. But how will that ambition be fulfilled? Does it imply more generous subsidies, or something different?

My report, the first in a new Policy Exchange series examining how the UK’s industrial policy must adapt to a world where global economic shocks are more common and the rules-based international order increasingly under threat, warns the government against engaging in a subsidy war. It argues that it should focus on other ways - for example, lower energy costs - of making the UK more attractive for batteryrelated investment.

At a time when the government is being widely criticised for not having a clear industrial policy, the Tata decision presents an opportunity to review what successive governments have done to support the auto industry’s transition to electric cars and to make a realistic analysis of the industry’s competitive position.

Whether or not the Sunak government believes in an interventionist industrial strategy, the motor industry is too important, and too exposed to several challenges, to be left in a state of uncertainty about government policy.

£ Sir Geoffrey Owen is Head of Industrial Strategy at Policy Exchange and a former editor of the Financial Times

Geoffrey Owen

Tata is set to build a new gigafactory to supply batteries to Jaguar Land Rover

Changing weather conditions in Northern Ireland might mean an undersupply of tasty potatoes over summer. Dry weather is harming the second harvest of crops. If the rain doesn’t come, farmers will have to delay their main crop, meaning there won’t be enough supply in the market for 2 or 3 months.

JAPAN: THE TIME TO VISIT IS NOW

Just hours after arriving in Japan from London, a geisha girl is teaching me a drinking game. She sings a lilting, nursery rhyme-style tune as we take turns tapping the small wooden box between us, trying to catch each other out by whipping the box away so the other person must lay a closed fist on the table instead. As the song gets faster and faster, she titters sweetly, knowing I have no chance of keeping up. Inevitably, I lose and drink, blaming the jet lag.

Nothing else about Japan is this predictable. A startlingly advanced but deeply traditional nation, its people are endlessly welcoming yet it has been one of the world’s most inaccessible countries since the pandemic hit in 2020. Borders only fully reopened to independent foreign tourists in October 2022, while mask-wearing guidelines only lifted in March.

There’s no nervousness about tourists returning, however – instead everyone I meet is delighted to see visitors and keen to chat, making this the perfect year to get ahead of the crowds and finally arrange that bucket list trip.

A two-city itinerary is the bare minimum, and pairing the country’s former imperial capital Kyoto with the sprawling, neon metropolis of Tokyo is perhaps the best way to experience both Japan’s fiercely modern, fast-paced buzz and its rich cultural history.

The world’s second largest UNESCO destination, Kyoto is a mystical wonderland of ancient temples, revered shrines and cobbled streets lined with geisha houses and tiny artisan workshops. Even my hotel, the otherwise sleek and contemporary Four Seasons Hotel Kyoto, has an other-worldly charm typical of the city. It’s built around an 800-year-old Shakusui-en pond garden mentioned in a 12th-century epic poem and believed to have been owned by a distinguished samurai’s family. In honour of its history, the hotel now offers lessons in the Japanese martial art Budo and has its own waterside tea-house where a tea master leads guests through a curiously meditative ceremony following a thousand-year-old tradition. Twice-weekly geisha performances also provide a rare insight into an ancient and much misunderstood art form, drinking games and all.

More than 2000 temples and shrines are right on the doorstep including the unmissable Fushimi Inari Shrine dedicated to the Shinto god of rice, where thousands of bright orange torii gates mark a zig-zagging 4km pathway up a hillside populated by wild monkeys – though visit at 7am to avoid tourists. Yet Kyoto isn’t frozen in time but a lively university town that comes alive at night with rooftop cocktail bars, Michelin-starred restaurants and nofrills izakaya (Japanese pubs). “People are going out more than ever since the pandemic,” local tour guide Aki Atanabe says. “There was some hesitation at first but now there’s so much going on, it’s much more appealing for visitors.”

Tokyo has ramped up a gear during the country’s closure too. Always a breakneck, technicolour city of the future, it seems newer and shinier than ever thanks to a clutch of fresh attractions, restaurants and hotels. Even the city’s iconic network of zebra crossings at Shibuya Station can now be seen from above on the open-air

TRAVEL HACK

Hope for the best but expect the worst: if your luggage goes astray, this Dynotag could save you a world of hassle, allowing the finder quick access to your contact details.

£20, dynotag.com

observation deck of Shibuya Scramble Square, a 47-storey skyscraper first revealed in late 2019. Elsewhere, Super Nintendo World opened in 2021, Miyashita Park has been revamped as a shopping centre and rooftop park and Red Tokyo Tower has launched Japan’s largest eSports complex filled with VR games and immersive attractions. Directly above Tokyo Central Station and with just 57 rooms, Four Seasons Hotel Tokyo at Marunouchi even unveiled the city’s most anticipated restaurant at the height of the pandemic in summer 2021.

Helmed by acclaimed British chef Daniel Calvert, Sézanne went on to win a Michelin Star just six months after opening and was named the second-best restaurant in Asia* this March.

Across town and despite lockdown, the chain went one further in September 2020 and opened the doors to its second location, Four Seasons Hotel Tokyo at

Otemachi. Spanning the top six floors of a skyscraper overlooking the Imperial Palace, this glamorous Jean-Michel Gathydesigned property has the best views in town, with everything from bathtubs to the chic cocktail bar framed by uninterrupted skyline vistas and a snow-capped Mount Fuji rising in the distance.

Elsewhere, Tokyo is a jumble of distinctive, enchanting neighbourhoods where you can stumble upon a pop-up art gallery or all-night karaoke bar as easily as a tranquil shrine hidden in a city park. In Asakusa, there are traditional Japanese theatres alongside street food stalls and a retro theme park, while unassuming vintage stores in bustling Harajuku reveal racks of pristine, second-hand Dior, Chanel and Issey Miyake. Wherever you go, there’s a surprise on every corner, from the street art of Shimokitazawa to the ancient tiered temple of Sensoji or any number of increasingly odd animal cafes,

if you prefer your matcha surrounded by puppies, snakes or even hedgehogs. By 6pm, the ramshackle row of izakya under the railway tracks near Yurakucho are packed out with an after-work crowd indulging in nomikai, where tradition dictates that colleagues should drink together to wind down. Try lively Andy’s Shin Hinomoto for sashimi platters and grapefruit sours, though expect to squeeze your own fruit over iced shochu, a Japanese spirit distilled from sweet potato. Paper lanterns and discreet nameplates are the only ways to spot some of the city’s best restaurants, reached by easily-overlooked staircases from the street.

At Genshi Charcoal Grill Iroriya Higashi, diners can kick off their shoes to crawl inside a tatami-mat lined booth where overflowing bowls of orange ikura (salmon roe) are dished up by waiters banging a taiko drum. If you’re feeling a little braver, try the set menu at Jidoriya Tsukada near

Among the last nations to remove covid restrictions, Japan is ready to welcome visitors, says Siobhan Grogan

BOOK THIS

A short drive or easy train ride from London, Updown is an outstanding “restaurant-withrooms” set in a 17th century farmhouse. Dine in the conservatory before retiring to the opulent rooms –a perfect weekend retreat. updownfarmhouse.com; 07842244192

Shibuya station, where I was served chicken sashimi – yes, really – washed down with (thankfully) unlimited sake. Later, a quick drink after dinner ends up on a dancefloor surrounded by Tokyoites all thrilled that we’ve made the trip and full of infectious enthusiasm about everything we should see and do in their city. By the early hours, even the DJ has left his booth and joined us. It’s Japan all over: gloriously larger than life, constantly surprising and somehow always able to entice you to stay that little bit longer.

NEED TO KNOW

A deluxe room at Four Seasons Hotel Kyoto starts from £800. A deluxe king room at Four Seasons Hotel Tokyo at Marunouchi starts from £725.

A superior city view room at Four Seasons Hotel Tokyo at Otemachi starts from £725. Book at www.fourseasons.com/japan

NOBU

HOTEL LONDON

SHOREDITCH THE LONG WEEKEND

Nobu Shoreditch is back with new rooftop rooms. Angelina Villa-Clarke checks in to check it out

THE WEEKEND: Like many London hotels, Nobu Hotel London Shoreditch was forced to close in March 2020, due to the pandemic. It reopened some two years later, having taken advantage of its time out of the spotlight to upgrade its offering. Found in a quiet street in what is London’s most creative corner, just off Great Eastern Street, Nobu’s avant-garde façade remains the same, as does its East London-meetsTokyo aesthetic. The difference is that the hotel stretches a little bit higher into the sky, with the addition of a brand new sixth floor. This houses a sprawling penthouse, with outside terrace and private lift. There are also a new cluster of luxury suites, which have a warehouse feel about them, with floor-to-ceiling windows, industrial details and a nice nod to the location with bespoke wallpaper designed by Shoreditch-based artist Richard Harding.

THE STAY: Nobu Shoreditch oozes ‘afterhours’ appeal. The original interior designers for the hotel, Studio Mica, were called upon once more to oversee the new rooms. The ambiance is urban-chic meets a Japanese Ryokan charm, with concrete walls, parquet flooring and low-slung furniture.

All the bedrooms give a nod to Nobu’s Eastern heritage, with thoughtful touches including traditional Japanese tea sets, kimono-style dressing gowns and lantern lighting. Polished stone bathrooms are lifted with a glamorous, shiny gold sink, and architectural potted bamboo.

DON’T MISS: There is a round-the-clock gym and a small-but-perfectly formed spa. The Nobu Zen Massage is curated to your

TOP TIP

If you want more of an immersion into Japanese culture, head to the nearby The Prince’s Foundation School of Traditional Arts for a lesson in the art of Japanese woodblock printmaking, origami and kintsugi – the centuries-old art of repairing broken pottery with gold paste

19-22 Charlotte Road, EC2A 3SG; princesfoundation.org

needs – and uses a custom-made oil –perfect for destressing after a hard week. You can also hire out the Penthouse suite for private parties, it comes with a terrace with retractable roof and a unique ‘hoop’ hanging chair by contemporary designer Lee Broom.

THE FOOD: Needless to say that, with its open kitchen, and signature shouting-out by the chefs of “irrashaimase” (“welcome to our house”), the restaurant Shoreditch does not disappoint. New executive chef Sandi Richmond celebrates locally-sourced produce to create some of Nobu’s famous dishes. Of course, the black cod miso is the hero of the menu, but not to be missed are the yellowtail jalapeno sashimi; salmon, spicy miso tacos and baby tiger shrimp tempura.

ASK ABOUT: The Omakase – or chef’s choice – experience. A series of dishes arrive, selected by the chef, so it’s like a surprise smorgasbord of delights – and takes all the ‘thinking’ out of the menu selection. Order a Matsuhisa Martini and go with the flow – you might get the umami chilean sea bass, cauliflower with jalapeño salsa or spicy seafood soup.

AND AFTER THAT? For breakfast, order the Scrambled Egg Donburi – a Japanese riff on traditional scrambled eggs and salmon –which comes with soy-infused salmon, steamed rice and nori.

NEED TO KNOW Rooms at Nobu Hotel London Shoreditch start from £295 per night, london-shoreditch.nobuhotels.com

City’s treble effort akin to United’s feat in 1998-99

AS THE result of a match, where a trophy was up for grabs, turned Manchester blue yet again, City went within one win of an iconic treble – something English football has not seen since United’s feat in 1998-1999. So with their 2-1 FA Cup final win over United leaving Pep Guardiola’s side two thirds of the way on the road to history, how does their treble attempt stack up to United’s from 24 years ago?

United began their treble season los-

CRICKET

ing the Shield – a 3-0 defeat to Arsenal – while Manchester City began this season with a 3-1 loss to Liverpool in the same competition. Both City and United went on to win the league ahead of closest challengers Arsenal. In 1998-1999 United won the league with 79 points, one clear of Arsenal, and won 22 of their 38 games.

What we learned as Tongue makes his mark at Lord’s

India. Josh Tongue will be hoping he doesn’t face the same fate. The 25-yearold Worcestershire bowler got a five-for at Lord’s on debut and has since been named in the squad for the Ashes.

The injury to Jofra Archer could be the best thing that’s happened to Tongue, giving the youngster a chance to play his second ever Test in the Ashes opener.

In 2022-23, City won the league by five points with 89. Guardiola’s side –who this season claimed their third consecutive title – won 28 matches. Both sides secured the second trophy of their season in the FA Cup. On the way to the final, United scored 12 goals and conceded three in their eight games – including sixth round and

semi-final replays against Chelsea and Arsenal respectively – while City’s six games to glory came conceding just one goal and scoring 19. Each side, too, were or could have been on for a quadruple if they were to win the League Cup but the competition became the Achilles heel for both.

Guardiola’s men lost to Southampton

in the fifth round, while United lost in the same round. United came second to Bayern Munich in their Champions League group but beat the German giants in the final that same year. City came top of their group and face AC Milan this weekend in the final.

City, currently on course for the treble, and United had remarkably similar seasons in 1998-1999 and 2022-23. The difference so far being United went on to win trophy No3. All eyes on Istanbul, then, to see if City can replicate that feat.

ENGLAND quite simply swept aside Ireland at Lord’s this weekend. Their 10-wicket win came inside three days and showed how impressive England are right now. But with the Ashes on the horizon, what did we learn?

RECORD GOES ON

There will come a point where we must simply stop calling the current England Test regime a new era, but while its elongated and successful start continues there will be few plans to suggest the honeymoon period is over. The win was Ben Stokes and Brendon McCullum’s 11th win in 13 Tests, an incredible feat.

It was also the first time in history a captain had won a Test match without bowling, batting or keeping wicket.

Amid concerns over Stokes’s fitness, this featresult will be one of comfort to England with the Ashes on the horizon. England were dominant, and could have been aggressive and declared early on day two, but they stuck with their batting order and gave their hitters some much needed practice given it’s had been three months since their last Test.

And while all eyes were on Zak Crawley, the opener delivered – albeit he was a little bit lucky to reach his 56 in the first innings and left runs on the Lord’s pitch. He will take a lot of confidence from the last couple of days.

TONGUE IMPRESSES

Four years ago, in the Test against Ireland ahead of a home Ashes series, England blooded Olly Stone. The now 29-year-old took three wickets at Lord’s and made 19 runs.

Stone was not picked for two years, until the 2021 tour of

But with With James Anderson set to come back, and the likes of Mark Wood, Stuart Broad, Ollie Robinson and Matthew Potts in the mix, it is a tough wall to breach for Tongue.

But being part of the Ashes squad will be as much a learning curve as having another good season with Worcestershire, so the 25-year-old will undoubtedly be relishing every moment of the coming weeks.

ASHES COUNTDOWN ON

The squad for the opening two Ashes Tests was announced over the weekend and it was unchanged from the side which faced Ireland.

Jack leach pulled out of the side last night, however, with a back fracture. That means Tongue remains in the squad group alongside the likes of Crawley and Ben Duckett, while Ben Foakes misses out. Foakes is widely seen as the best wicketkeeper in England and his exclusion, at the expense of Jonny Bairstow, will see the Ashes hosts without a key keeper-batsman.

There were discussions as to whether there could be room for both Bairstow and FokesFoakes in the same side but that would see the former potentially moved to a spot asup to being an opener, Stokes and McCullum are confident in their side and will be keeping an eye on Australia as they take on India in the World Test Championship final at the Oval this week.

England are on a run of 11 wins in 13, but the biggest test is on the horizon. An Ashes series, at home, against the holders. Is there anything better?

Tongue got a five-for on debut at Lord’s

Guardiola’s side are two thirds of the way to a treble. But how similar is their attempt to United’s success, asks Matt Hardy

England win again as side look to Birmingham and Ashes onslaught, writes Matt Hardy

SPORT

CRICKET

England handed Ashes blow as Leach pulls out with back injury

ENGLAND’S Test team have been dealt another major bowling blow ahead of this month’s Ashes series with leading spinner Jack Leach pulling out of the famous five-Test competition against Australia.

Leach played in England’s 10-wicket victory against Ireland over the weekend but has since pulled out of the squad due to a lower back stress fracture.

The 31-year-old Somerset spinner spent some time off the field on the third and final day of England’s Test against Ireland.

He follows seamer Jofra Archer in missing the iconic series through injury and it comes after minor injury concerns for fellow bowlers James Anderson and Ollie Robinson and captain bowler Ben Stokes.

In a statement, the England and Wales Cricket Board said: “England Men's spinner Jack Leach has been ruled out of the LV= Insurance Men’s Ashes series with a low back (lumbar) stress fracture.

“The 31-year-old Somerset slow-leftarmer developed low back symptoms during England’s LV= Insurance Test victory over Ireland on Saturday.

“A scan on Sunday in London has revealed a stress fracture, which will keep him out of the forthcoming Ashes Test series, which gets underway

FOOTBALL BUSINESS

TONGUE, STOKES AND WINNING

What we learned in England’s last Test before the Ashes

PAGE 19

at Edgbaston on Friday 16 June.”

It is not the first stress fracture for the Test side in recent years with the likes of Archer, Saqib Mahmood and Matthew Fisher all suffering from similar injuries despite being in the prime of their careers.

Leach bowled 14 overs in England’s first innings in the field and 20 in the second, taking two and four wickets respectively.

England’s dominance at Lord’s across the three days of competition meant Leach was not required to bat.

A replacement is expected soon but a number of players, including Adil Rashid and Rehan Ahmed, could be in line to take

Hamilton says he’s ‘flat out’ motivated at Mercedes despite another Red Bull win

MATT HARDY

on Australia – it is unlikely, however, that England will face the Baggy Greens with only pacers like they did in parts of their 4-0 humiliation Down Under in the last series.

Will Jacks and Matt Parkinson could be in the mix but they have not been staples of the Ben Stokes-Brendon McCullum era – Leach has played every test under the new regime.

Amid the usual circumstances the England team could call on Moeen Ali but the all-rounder has previously ruled himself out of Test cricket.

£ LEARNINGS FROM LORD’S P19

LaLiga unveil new branding as Spanish league looks forward

MATT HARDY

SPANISH football’s LaLiga has today announced a rework of their branding as the domestic competition steps up efforts to capitalise on global opportunities.

The league, which has traded in former sponsor Santander for EA Sports, has unveiled a new brand identity which sees a pair of Ls take the place of the old logo, which has been part of the competition in some form since 1993.

LaLiga is currently trying to weather a racism storm after repeated instances of abuse towards Real Madrid’s Vinicius Jr was met

with criticism of the winger from league president Javier Tebas.

The LaLiga season concluded last night but Barcelona wrapped up their first title since 2019 last month. The two major Madrid clubs and Real Sociedad completed the top four, all of whom qualify for the Champions League next season.

Ángel Fernández, head of global brand and strategy at LaLiga, said: “Over the past 10 years we have taken on the responsibility to inspire people through the positive values of our sport, something we consistently demonstrate through our clubs, our fans and our entire ecosystem of competitions.”

SEVEN-TIME world champion

Formula 1 driver Lewis Hamilton has said he is “flat out” motivated at Mercedes despite Max Verstappen winning his third consecutive F1 race yesterday in Barcelona.

The Dutch reigning world champion Verstappen’s win ensured that Red Bull maintained their 100 per cent winning record so far this season after seven races. The constructors’ leaders, between Verstappen and teammate Sergio Perez, have also led every lap of the last three races.

But Mercedes arrived in Spain with upgrades and managed to

finish in second and third on the podium. Hamilton, who edged his teammate George Russell to second, said: “What a result for our team.

“We definitely did not expect to have the result we had today so I just really want to take my hat off to my team and thank everyone back in the factory for continuing to push and bring us a little bit closer to the [Red] Bulls.

“They’re still a bit ahead but we will keep on chasing them down, this is an amazing result and George [Russell] did a great job.

“They [Red Bull] are still a little bit too quick at the moment but we’re working at it. One step at a time. If we could get close by the end of the

FOOTBALL

year then that would be awesome but if not, next year. “[I’m] flat out [motivated]. Flat out. No lifting.”

Despite starting third on the grid, McLaren’s Lando Norris could only finish 17th.

Sergio Perez finished fourth with Carlos Sainz, Lance Stroll, Fernando Alonso, Esteban Ocon, Zhou Guanyu and Pierre Gasly making up the top 10. Charles Leclerc was 11th. Verstappen leads the 2023 drivers’ standings with 170 points while his teammate is second on 117. Alonso is third on 99.

Red Bull lead the team standings on 287 points with Mercedes on 152 and Aston Martin on 134.

Djokovic and Alcaraz on for semi showdown in Paris

MATT HARDY

THE HOTLY anticipated first Grand Slam meeting between world No1 Carlos Alcaraz and 22-time major winner Novak Djokovic is just one match away after both players dispatched their third round opponents and reached the last eight in Paris.

Serbian Djokovic beat Juan Pablo Varillas 6-3 6-2 6-2 to earn a quarter-final tie against Karen Khachanov while Spaniard Alcaraz overcame Lorenzo Musetti to reach the same stage at Roland Garros.

Djokovic and Alcaraz will meet each other in the last four if they win their quarter-finals.

The duo have played once before – at the 2022 Masters in Madrid – with Alcaraz winning in three sets.

Elsewhere at Roland Garros, a women’s doubles team made up of Miyu Kato and Aldila Sutjiadi were disqualified in the second set of their round of 16 tie after the Japanese player Kato inadvertently struck a ball girl.

Karolina Muchova beat Elina Avanesyan 6-4 6-3 to reach the quarterfinals while Anastasia Pavlyuchenkova took three sets to beat Elise Mertens in three sets. Women’s world No1 Iga Swiatek competes today against Lesia Tsurenko of Ukraine while Alexander Zverev plays Grigor Dimitrov.

MATT HARDY

Leach is the latest to get injured due to an issue with the lower back

LaLiga’s logo could represent a cheering fan or a knee slide