Aurelia Butler

His comments come amid concerns of the new leftist administration of President Luiz Inacio Lula da Silva regarding the impact of high borrowing costs on economic growth, as the country’s benchmark interest rate remains at a six-year high of 13.75% to combat inflation.”The government is carefully monitoring the credit market to ensure liquidity and access,” Ceron told a news conference. “Possible needs for specific sectors are being discussed, such as small and medium-sized companies, but this is still in the initial stage of discussion,” he added.Outstanding loans in Brazil decreased by 0.3% in January, marking the first decline in a year. However, the central bank highlighted the seasonal aspect of the result and said it was still too early to evaluate whether Brazilian retailer Americanas SA bankruptcy protection is impacting the credit market. During the press conference, Ceron stated that a broad consumer debt renegotiation program is in its final stage and will be announced soon. The government’s idea is to use public funds that already exist to guarantee the renegotiation without any fiscal impact, although Ceron did not rule out the need for new contributions from the Treasury this year or next to make the program viable.The secretary also stated that the increase in the minimum wage promised by Lula will cost about 5 billion reais, and the rise in income tax exemption will cost another 3.2 billion reais, but added other compensatory measures would accompany them. More

After months of secret negotiations the UK and the EU on Monday published the text of their new deal to refine post-Brexit arrangements for Northern Ireland.Totalling more than 100 pages, the deal — called the Windsor Framework — sets out ways to smooth the working of the so-called Northern Ireland Protocol, which has soured EU-UK relations and destabilised the politics of the region.Although Northern Ireland continues to follow EU rules for goods trade, the new implementation agreement sets out processes on trade, state subsidy and value added tax policy to reduce the impact of the trade border in the Irish Sea created by the original deal.While Northern Ireland remains subject to EU law in areas where it applies in the region, the deal takes steps to address concerns in the mainly Protestant unionist community that the protocol has undermined the constitutional integrity of the United Kingdom.The new framework aims to improve the functioning of the protocol in five key areas:The business of trade: red-green lanesGoods coming from Great Britain to Northern Ireland will now be divided into two classes: those that are destined for Northern Ireland (green lane) and those heading on to Ireland and the EU single market (red lane). Companies that register for a trusted trader scheme and use the green lane will have “an unprecedented reduction” of customs paperwork, the EU said. Goods in the red lane will have to go through full customs, food and animal health checks. For agri-food, the most tightly controlled goods, the EU will accept UK public health standards, meaning fresh meat and other goods will be allowed to enter Northern Ireland. They must carry “not for EU” labels. As the labels are introduced between now and 2025 the proportion of consignments subject to identity checks will fall to 5 per cent. The UK has agreed to share near-real time customs data with the EU so it can spot evidence of fraud and take remedial action if necessary.UK prime minister Rishi Sunak said the changes “removed any sense of a border in the Irish Sea”, while an EU official talked of a “dramatic reduction in the number of checks”.Parcels to friends or family and from online deliveries from Great Britain will not require customs paperwork, ending another significant source of aggravation for Northern Ireland residents. Businesses using approved parcel carriers will have simplified customs procedures.Importers of some types of British-made steel in Northern Ireland have had to pay tariffs since last year when the EU changed its quota rules. The deal also fixes this issue for steel specifically. State aid & VATUnder Article 10 of the protocol, any UK subsidy decision that might affect Northern Ireland goods trade must be referred to Brussels for approval. The UK viewed this as an unnecessary impingement on its sovereignty.Although Article 10 remains in place, the UK government said “stringent tests” would now apply, effectively removing 98 per cent of Northern Ireland subsidies from being at risk of referral to Brussels. “This rules out all but the largest subsidies and those where firms have no material presence in Northern Ireland,” the UK said.Another area of difference that riled British ministers was that Northern Ireland could not adopt domestic VAT rate changes, something Sunak said was unacceptable when chancellor. These will now be extended to Northern Ireland, including politically talismanic items: some cuts to alcohol duties will now apply UK-wide, including relief for beer in pubs. However, except for immovable objects such as household solar panels, the UK cannot undercut EU minimum VAT rates for now. The two sides have agreed to draw up a list of goods where the UK could impose lower rates over the next five years.Governance and consent: role of Northern Ireland institutionsFor Northern Ireland’s unionist community, the prospect that the region would have to automatically implement large amounts of new or updated EU law in the future, as specified in the protocol, has long been a source of tension.The deal seeks to address this by handing an “emergency brake” to the Northern Ireland legislative assembly at Stormont that can be pulled in “exceptional circumstances” if 30 of the 90 members from at least two parties vote to block the adoption of updated EU single market rules.Under this ‘Stormont brake’, rules that are subject to objection will not be applied until they have been discussed by Brussels and London. If Britain decides not to implement measures that the EU still deems necessary at the behest of the Northern Ireland assembly, the bloc could take targeted “remedial measures”. London has said it will legislate to ensure that the Westminster government takes account of Stormont’s demands if and when it pulls the emergency brake. Experts said the circumstances when it could be used were very tightly drawn. “This is progress, but the new system only applies when the brake is pulled,” said Catherine Barnard, EU law professor at Cambridge university. “For the rest of the time it is business as usual.”Feeling part of the UnionEU rules had created a number of bureaucratic hurdles that unionists believed cut them off from the rest of their country. Pets had to be microchipped and get a passport to travel from Great Britain to Northern Ireland — the same rules needed to travel to the EU. Under the deal, pets will only need a simple travel document. Medicines approved for use in the UK could also be sold in the region even if not yet approved in the EU. Finally, seed potatoes and plants banned from being imported because they might carry disease can now move freely to Northern Ireland on the basis of a special plant health label.The constitutional dimension: the role of the ECJLeading Brexiters and unionists have demanded an end to the jurisdiction of the European Court of Justice over Northern Ireland, and to the ECJ’s role as the enforcer of the protocol. The deal does not achieve this; nor does it create a new dispute resolution mechanism involving international arbitration, as some leading Brexiters had wanted.The UK government argued the new “green lane” trading system significantly narrowed the amount of EU law applying in Northern Ireland, meaning 1,700 pages of EU law that were enforced in the original deal will no longer apply in the region. The government added only 3 per cent of EU laws were now applicable in Northern Ireland. According to the command paper: “The rules that do apply are there solely, and only as strictly necessary, in order to maintain the unique ability for Northern Ireland firms to sell their goods into the EU market.” More

Lidl became the fifth supermarket to introduce rationing as the government summoned senior executives from some of the leading UK grocers to discuss the supply chain problems.The discount supermarket announced on Monday that it would “temporarily limit” the purchase of peppers, tomatoes and cucumbers to three items per person, following supply chain disruption blamed mainly on extreme weather in Spain and Morocco.Lidl’s announcement means that five out of the six biggest supermarkets accounting for more than two-thirds of the UK grocery market, according to data from Kantar, are rationing supplies of salad vegetables. Sainsbury’s, the UK’s second largest grocer, has said that it will not impose limits on purchases of vegetables for the moment, although it confirmed it is also experiencing shortages.Supermarket executives spoke to Mark Spencer, food, farming and fisheries minister, on Monday afternoon in a call that focused on avoiding future repeats of the shortages, rather than resolving the current rationing, according to one source close to the talks. They added that there were no discussions about the government intervening to support producers as farmers had called for last week. One industry insider dismissed the talks as “a way for the government to sound busy”.

In a statement after the meeting, Spencer sought to reassure the public that the food supply chain was “extremely resilient,” adding: “I spoke to retailers today to hear from them direct about the important work they’re doing to respond to and alleviate the current short term issues. I have also asked them to look again at how they work with our farmers and how they buy fruit and vegetables”.Andrew Opie, director of food and sustainability at the British Retail Consortium said the government had been reminded by executives at the meeting “how hard” they were working to address the problem, adding that they had “confirmed that customers should start to see an improvement in the coming weeks.” He said that although “the majority” of food sold in supermarkets comes from the UK there was a “key role for imported food, particularly outside of the UK growing season, to maintain the supply of affordable food for households.”He called on the government to develop a “wider strategy” to deal with the issue of food security involving farmers, food manufacturers, retailers and hospitality.The government has faced a growing backlash over its handling of the shortages. Environment secretary Thérèse Coffey was mocked last week for suggesting that consumers should embrace more seasonable foods, such as turnips, in light of the supply chain issues.“It’s important to make sure that we cherish the specialisms that we have in this country,” she said. “A lot of people would be eating turnips right now rather than thinking necessarily about aspects of lettuce and tomatoes and similar, but I’m conscious that consumers want a year-round choice and that is what our supermarkets, food producers and growers around the world try to satisfy.”Last week, English growers said that imports of salad vegetables had fallen to about a half of expected levels. More

Since Britain’s exit from the EU in 2020, special trading rules for Northern Ireland have been the source of rancour and division. The so-called Northern Ireland protocol was poorly negotiated, then partially disowned, then nearly overridden by the UK, threatening a trade war with the EU. Reforms to the protocol agreed by Prime Minister Rishi Sunak should not only ease trade but also set the UK on a more constructive relationship with the EU. The “Windsor framework” negotiated with European Commission president Ursula von der Leyen is a significant moment for post-Brexit Britain. A pragmatic prime minister has pushed for something he believes can bring beneficial results, defying hardline opponents in his party. With luck, the deal may yet begin a normalisation of UK-EU relations, and of UK politics.Boris Johnson’s EU exit deal left Northern Ireland inside the EU’s single markets for goods, so checks were imposed on goods entering from Great Britain to avoid creating a destabilising land border with the south of the island. Resulting trade frictions made unionists, who want the region to stay in the UK, feel ties with Britain had been weakened.Attempting to negotiate reforms was a hefty gamble for Sunak. Though he appears to have won over some prominent Brexiters, a hardcore of Eurosceptic Tory MPs may prove immovable. Labour has rightly signalled its backing for the prime minister’s agreement in a parliamentary vote, but will clearly make political capital out of Conservative divisions.It is unclear if the Windsor framework goes far enough to be embraced by the Democratic Unionist party, which has boycotted power-sharing in Northern Ireland unless the protocol was renegotiated. So the agreement may yet fail to achieve the other big objective of returning devolved government to Belfast. But Sunak is correct to judge that the UK’s wider interests are better served by pressing ahead with his deal.The prime minister appears to have achieved more than many in his own party had expected — a sign, perhaps, that he has built trust in Brussels. If it works as intended, Sunak can claim his deal ensures “smooth flowing trade” within the UK by creating a “green lane” at Irish Sea ports with minimal checks for goods destined for Northern Ireland, even if those heading for Ireland and the EU market must take a “red lane”. EU negotiators have moved less far on key legal points. But while the European Court of Justice retains the last word on single market issues in Northern Ireland, its role is limited, and London, not Brussels, will have control of value added tax and state aid in the region.Crucially, the deal gives the Northern Ireland assembly an “emergency brake” on changes to EU goods rules with a “significant and lasting effect” on everyday lives — with a UK government veto if that brake is pulled. This provides a potential incentive for the DUP to engage with the Northern Ireland assembly, and could open it up to criticism if it does not.The agreement moves the UK off a collision course with the EU, and towards a reset. Von der Leyen suggested work could quickly begin on the UK joining the €95bn Horizon programme, a huge prize for the scientific community. The deal may help Sunak to make progress on small boat crossings in the Channel when he meets France’s Emmanuel Macron next month.Above all, in a Europe transformed by Russia’s invasion of Ukraine, the Windsor framework holds out the prospect of smoother engagement between London and EU partners. Assuming it can be navigated safely through Westminster, it may at last begin to drain some of the venom of the Brexit years. More

Today’s top storiesThe UK and the EU agreed a deal on post-Brexit trading rules for Northern Ireland. The British Chambers of Commerce welcomed the deal, dubbed the Windsor framework, but it is not yet clear whether it will be acceptable to Northern Ireland’s Democratic Unionist Party and hardline Tory Brexiters.Andrew Griffith, the UK’s City of London minister, raised concerns that reforms to stop consumers being ripped off by financial services companies could damage the sector and trigger spurious lawsuits.A US congressional panel focusing on threats from Beijing has begun its work, looking at the role of private equity, venture capital and Wall Street firms in China. Back in China, EY staff are being encouraged to wear Communist party badges to show their political loyalty.For up-to-the-minute news updates, visit our live blogGood evening.Don’t bet on interest rate cuts anytime soon. That was the message today from the Bank for International Settlements, which warned investors that borrowing costs needed to stay high to make sure inflation was brought to heel.The BIS — often referred to as “the central bankers’ bank” — highlighted the discrepancy, until recently, between investors’ beliefs that rates would stop rising this year and start falling next year and policymakers’ signals that “gave no indication that easing was on the horizon”. That message was given credence by higher than expected US inflation figures and strong jobs data. Today’s figures on durable goods orders, excluding transportation, were also better than expected.Investment expert Mohamed El-Erian, writing in the FT today, welcomed the growing acceptance that US inflation was “stickier” than many had presumed, but urged Congress to do more by enhancing Fed accountability and helping it improve its policy procedures.Recent data across the Atlantic has also been better than expected, ending expectations that the European Central Bank was similarly close to winning its battle with inflation. Investors are now betting that the ECB will raise interest rates to all-time highs as more evidence emerges of the eurozone’s resilience and signs that inflation could prove tougher to rein in than expected.The “reality check” has brought the global rally in bond markets to an end while US stocks have just suffered their biggest weekly fall in more than two months.Hyun Song Shin, the BIS’s head of research, said the lesson from the 1970s was that inflation could return if policymakers didn’t squeeze it out of the economy. “The reason central banks have been emphasising [the importance of] going the last mile on bringing inflation down is that, if you are not fully back to target and relax too early, you will undo all the work you have done before,” he said.Need to know: UK and Europe economyAnalysts are now forecasting a smaller contraction in UK output because of falling energy prices and better than expected business and consumer sentiment. The average GDP forecast for 2023 now shows a drop of 0.6 per cent, compared with previous estimates of 1 per cent.UK regulator Ofgem lowered the household price cap on energy bills, reflecting the significant decline in wholesale gas and electricity prices. The cap will fall from £4,279 to £3,280 from April. Wind farm developers are demanding UK tax breaks to offset the rising costs of turbines.Need to know: Global economyNew FT analysis delves into the battle of the Asia hubs: Hong Kong versus Singapore. Real estate prices, air traffic and other indicators suggest the Chinese territory has been losing ground. In Shanghai, China’s financial hub has begun to revive — but not to the outside world.

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Big US employers are reporting a strong improvement in hiring conditions despite unemployment being at its lowest level in decades.Six months into his tenure as Colombian president, Gustavo Petro has cast aside any notions of moderation, denouncing “neoliberalism” for causing war, Covid-19, hunger and the climate crisis and railing against businesspeople whom he said were plotting to frustrate his reforms. Mexican president Andrés Manuel López Obrador’s erratic and egocentric political style has now reached a truly dangerous stage, writes chief foreign affairs commentator Gideon Rachman, with a new law that will gut funding for the body which runs the country’s elections. If you’re a Brit looking for a good value holiday, try Egypt, where sterling is up 72 per cent year-on-year against the Egyptian pound. Tourist numbers have gradually recovered in the region after security concerns and the pandemic, with arrivals likely to be welcomed in an economy struggling with 26 per cent inflation.Need to know: businessAustralia’s Recharge Industries completed a deal to buy most of Britishvolt, the UK battery start-up that collapsed into administration last month after running out of cash. Recharge has been given until the end of next month to close a deal to buy the failed start-up’s site in Northumberland, according to two people close to the process.Associated British Foods, which owns the Primark clothing chain as well as assorted food brands, said profits this year would be bigger than expected as shoppers hunt for bargains.Woodside, Australia’s largest oil and gas group, said Europe and China held the keys for the energy market this year as it reported a trebling of profits. Australian companies including BHP, Rio Tinto as well as Woodside are seen as good indicators for global demand given the significance of the country’s mining and energy exports.Twitter chief Elon Musk axed more senior staff at the weekend as he continued his efforts to bring costs under control.Big Tech lay-offs are however music to the ears of Japanese conglomerate Hitachi, which is planning a hiring spree in the US to expand its digital services.Manchester United owners have put the football club up for sale with a potentially record-breaking target price of $6bn-$7bn. FT calculations however suggest the real value is around $1.6bn. Author Sachin Khajuria explores what private equity means for football.The World of WorkSome 2mn people in the UK are suffering from Long Covid, a strain of the disease in which symptoms persist for more than four weeks. Experts argue that employers need to offer more time and flexibility compared with other illnesses. Read more in our special report: Health at Work.A sharp rise in diagnoses of neurodiversity among adults means many more workers, including senior leaders, will need to consider the potential impact on their jobs — and their bosses may have to adapt.Lockdowns are over but many people are still working from home in what some economists have called “Long Social Distancing”. The reasons are three-fold, argues columnist Tim Harford: it works better than we expected, we’ve invested in home kit, and the stigma of working from home has disappeared, reducing the benefits of commuting.Columnist Janan Ganesh argues we should stop making fun of managers. Britain is struggling in part because it stigmatises those who run things, or as he puts it: “There is grandeur in ownership. There is dignity in labour. It is the tier in between that has to plead for its reputation.”Some good newsA charity helping Ukrainian refugees in Swindon has launched a beer with a local brewery to mark the first anniversary of the war and raise funds for its activities. The Hop Kettle Brewery hopes to make the brew — called Volya or “Freedom” in Ukrainian — available online nationally. More

Northern Ireland’s biggest unionist party on Monday gave a guarded initial response to the Brexit deal struck by Rishi Sunak with the EU on revised trading arrangements for the region, saying “key issues of concern” remained.Democratic Unionist Party leader Sir Jeffrey Donaldson said he was concerned that EU rules would still apply in Northern Ireland under the prime minister’s agreement.While accepting “significant progress” had been made in some areas, Donaldson added: “The key issue is why is EU law being applied and what is the purpose of that?” The DUP’s reaction to the proposed overhaul of the so-called Northern Ireland protocol will be a key test for Sunak’s bid to restore the region’s devolved government. The DUP has boycotted the power-sharing assembly and executive at Stormont since last May to press for sweeping changes to the protocol.Donaldson said his party would study the legal text of Sunak’s deal carefully and would not be rushed into a verdict. Ian Paisley Jr, a DUP MP, told the BBC the agreement “does not cut the mustard”.Donaldson said he wanted to understand what Stormont could do if there were any changes to EU rules on goods trade that affected Northern Ireland’s position in the UK internal market.Under Boris Johnson’s 2019 Brexit deal that includes the Northern Ireland protocol, the region stayed in the EU single market for goods.Sunak’s deal includes a mechanism that could give Stormont the right to apply a “brake” on updated EU rules on goods, with the UK able to oppose them, in exceptional circumstances.Donaldson said that of the £77bn in goods produced in Northern Ireland every year, £65bn were traded within the UK and he needed clarity on which rules would apply and to ensure there were no barriers within the UK internal market. “It really is the £65bn question because . . . that’s the extent of trade that we do with the rest of the UK,” he added.Donaldson said: “We will want to continue engaging with the prime minister and his team to examine what these new arrangements will mean . . how they will work in practice.

“And then yes of course there may need to be further engagement with the EU.”Sunak said all parties would be given time and space to digest the deal, as he tries to pave the way for parliamentary approval of his agreement.Donaldson will consult the DUP’s other 11 officers and then the wider 100-strong party executive. Experts said he could seek to delay his final verdict on Sunak’s deal until after council elections on May 18.He can claim that he has successfully pushed the EU into accepting changes to the protocol that go beyond anything Brussels initially said was possible. But hardliners in his party want no EU laws to apply in Northern Ireland at all, and no oversight of the trading arrangements by the European Court of Justice. Despite the changes agreed by Sunak and von der Leyen, the ECJ retains a role. Whether Sunak’s agreement will secure the restoration of Stormont was unclear. Northern Ireland’s nationalist and unionist communities have to share power under the 1998 Good Friday Agreement that ended the region’s three decades-long conflict.

The run-up to the 25th anniversary of the agreement in April has already been marred by the attempted murder last week of an off-duty police officer. The attack has been claimed by dissident republican group the New IRA.Opinion polls show a majority of DUP voters do not want their party to return to the Stormont assembly and executive unless the protocol is either removed or substantially changed.“The DUP leadership will need to enable their supporters not to think they’re immediately being sold out,” said Katy Hayward, professor of political sociology at Queen’s University Belfast. Despite the political uncertainty, business leaders were encouraged by Sunak’s deal.“I’d be surprised if it’s completely satisfactory but it should be capable of improvement over time,” said Archie Norman, chair of retailer Marks and Spencer, who has been highly critical of the protocol.Stuart Rose, chair of Asda, the supermarket, hailed the deal as a pragmatic solution. “Chapeau to the prime minister,” he added. “The grown-ups are back in the room.” More

The UK may be the world’s sixth-largest economy but that economy is unable to guarantee its citizens a salad.Tomatoes, peppers and cucumbers have been rationed in five leading supermarkets since last week following a drop in supply of about half, forcing households to opt for turnips and other seasonal vegetables instead. The chagrin of British consumers has only been worsened by helpful social media users posting images of produce-laden shelves from Madrid to Kyiv and crates of fresh salad being unloaded in snowy Helsinki.There are multiple causes for the breakdown of the UK’s supply chain in crunchy vegetables. Bad weather in Spain and Morocco was the trigger, causing a sharp contraction in the harvest there. The country’s location across the Channel from continental Europe was another, tempting suppliers with limited stocks to spare their truckers the extra journey. Brexit red tape is an additional deterrent, and some blame can also be placed at the door of neglectful UK ministers who failed to heed warnings of domestic glasshouses shutting down because of spiralling energy costs and labour shortages.But the supermarkets, which have kept UK food prices among the world’s lowest, must also take stock. As a proportion of incomes, UK food budgets in 2021 were the world’s third-lowest at 8.7 per cent, according to Our World in Data, after the US and Singapore. Among other developed economies, Japanese households paid 16.7 per cent and Italians 15.5 per cent; countries such as Taiwan to Sweden were well above 10 per cent.Fierce competition among UK supermarkets, heightened by the arrival of German discounters Aldi and Lidl in recent decades, has helped keep prices low. Clive Black, of Shore Capital, says those discounters use basic goods as loss leaders to lure shoppers through their doors and away from rivals. They have not been shy of taking credit; reporting a drop in profits in September 2022, Aldi chief executive Giles Hurley said the group had “put people before profits and . . . made the right decisions”.The recent crisis has been a test of contracted suppliers’ loyalty to the retailers © Andy Rain/EPA-EFE/ShutterstockYet now that inflation is high and supply chains are still reeling from Brexit and the chaos wrought by the Covid-19 pandemic, those decisions are having unwanted consequences. There is a months-long egg shortage after producers cut down their laying flocks in response to costs rising higher than the prices they receive, and those prices are ultimately set by supermarkets. Now the UK is experiencing a worse salad shortage than its neighbours — in part, industry figures say, because of the low prices its stores pay for produce. Supermarkets hardly operate on generous margins but those of fruit and vegetable growers are even slimmer: about 1 to 2 per cent, says Jack Ward, chief executive of the British Growers Association.A cucumber in the UK costs 70p to 80p, Ward says. In France, it fetches about €1.80 (£1.59). “That partly explains why their shelves are full and ours are not,” says Ward. The recent crisis has been a test of contracted suppliers’ loyalty to the retailers, who have been reduced to calling round growers and processors to urge them to keep sending vegetables rather than favouring other outlets or selling on the open market. Not all have complied.That same squeeze on prices has prompted UK producers to scale down their operations, some permanently. And as the salad crisis has shown, simply relying on imports is not a fail-safe strategy. Broiler chicken producers are the latest group to cut back their operations as prices failed to keep pace with spiralling costs. Production numbers are down about 12 per cent so far, according to the British Poultry Council. Retailers are so far making up the difference from Spain, mirroring the salad situation and undercutting domestic prices further. The nation’s favourite protein could become the next foodstuff to be in short supply in supermarkets.Ministers do have some powers to intervene; they are already scrutinising the supply chains of dairy and pig meat. They have signalled a reluctance to carry out further investigations, however. Thérèse Coffey, the environment minister, angered farmers last week by refusing to attribute the egg scarcity to a “market failure”.But this government may be replaced within two years by one much more comfortable with intervening in markets. In the meantime, the great salad shortage will not be the last breakdown of an overstretched food system. “Shoppers . . . are not paying enough for a secure and sustainable supply chain,” says Black.Supermarkets are happy to take credit for low prices, but they must take some responsibility for empty shelves as well. Perhaps it is time to reconsider their race to the bottom. More