Morning business news - February 27Wednesday 27 February 2013 14.31
EXPORTERS FACING VOLATILITY DUE TO CURRENCY AND UK CONCERNS - Exports have been one of the star performers in an otherwise fairly downtrodden Irish economy over the past few years. Recent currency movements, though, and the potential departure of the UK from the EU could have implications for the sector, as Alan Duffy, Head of HSBC's Corporate Banking division notes on the publications of the bank's Global Connections report.
"Currency volatility is back to the fore. We've witnessed continued weakness of sterling. However, with volatility after the Italian elections, weakness has come back into the euro," he says. "Volatility is an issue that exporters have to deal with on a daily basis. The UK leaving the EU would increase volatility for Irish exports," he adds. The HSBC Global Connections report predicts that China will make its way onto the list of our top 5 trading partners before 2030. "We're going to retain the US, the UK and Germany as our top three partners. China will supplant France as our fourth largest market which is very significant,'' Mr Duffy says. "The BRIC countries are very important markets. Ireland has had a disproportionate amount of airtime with those markets, particularly China, for all the right reasons. We are well positioned to punch above our weight," Alan Duffy added. Pharmaceuticals, chemicals and the food ingredients sectors will continue to dominate the export landscape, the report concludes.
MORNING BRIEFS - The head of Tesco in the UK has given his first interview since the horsemeat controversy erupted. The supermarket chain is set to tell the UK Farmers' Union today that it will source meat from closer to home, and where possible, from Britain. He also says that Tesco will offer longer term contracts to suppliers.
*** A cement company based at Dublin Port, Ecocem, has said it hopes to create 61 jobs in a €19m investment at a new plant there. And in Blanchardstown, 75 new jobs are to be created by Guidewire Software which is a global provider of software solutions to the insurance industry.
*** EU states could agree as early as today to impose caps on bankers' bonuses. The negotiations - under the stewardship of the Irish presidency of the EU - resume after talks failed to reach agreement last week. Banks have strongly resisted bonus caps, saying such limits would only force banks to raise basic pay to keep staff, making wage bills less flexible. Britain does not want any measure that it believes might harm the City of London. The wider view is that a cap - possibly double basic salary - is the only way to rein in huge pay packets and reduce incentives for risk and make banks safer.
*** US stocks ended higher last night, rebounding from their worst decline since November. It followed an appearance by Federal Reserve Chairman Ben Bernanke before the Senate Finance committee where he defended the Fed's money printing programme which investors had thought was about to come to an end. Meanwhile, sales of new homes in the US hit a four and a half year high, figures out yesterday showed.