Why not request our brochure today?      Or give us a call 020 3007 6002

| ES IT
Subscribe
Business

The International Monetary Fund (IMF) has approved $1.4bn (£1.1bn) in emergency funding for Ukraine

   News / 10 Mar 2022

Published: 10 March 2022
Location: London, UK

By Suzanne Evans, Director, Political Insight


The International Monetary Fund (IMF) has approved $1.4bn (£1.1bn) in emergency funding for Ukraine as it fights against a Russian invasion, the BBC reports. The IMF predicts Ukraine will see a deep recession this year. More than 2m people are estimated to have left the country since the war started two weeks ago. Earlier this week, the World Bank approved a $732m financial package for Ukraine and is planning more economic assistance for the coming months.
 
Global oil prices yesterday posted their biggest plunge since the early pandemic days nearly two years ago, after OPEC member the United Arab Emirates said it would support increasing output into a market in disarray because of supply disruptions caused by sanctions imposed on Russia after it invaded Ukraine. Brent crude futures settled down $16.84 (£12.80), or 13.2%, at $111.14 (£84.44) a barrel, their biggest one-day decline since April 21, 2020. US crude futures ended down $15.44 (£11.50), or 12.5%, at $108.70 (£82.59), their biggest daily decline since November. Members of the International Energy Agency say they are also ready to release more oil from their emergency reserves to quell surging oil prices.
 
The RAC has upped its prediction for petrol prices. Now, the British motoring organisation says the average cost of petrol will top £1.60 a litre this week, while diesel will hit £1.70. The cost of filling an average family car with diesel has already topped £90 for the first time, as the average price of a litre rose 3p overnight to a record 165.24p, the biggest daily jump since 2000. The UK imports about 18% of its diesel from Russia.
 
Higher petrol and diesel prices will lead to people paying more for food in shops and restaurants, the Federation of Wholesale Distributors says. "Food price inflation is already happening, but this is going to make it worse, because there'll be charges passed on… people buying food and drink in shops, when they're eating out, will be paying more because the cost of distributing those goods to the outlet has gone up so much," CEO James Bielby told the BBC.
 
Australian and South African miners are exploring ways to supply coal and metals consumers in Europe scrambling for alternative sources to Russian supply, but logistics and cost constraints make it difficult to rapidly boost output, Reuters reports. Prices of palladium, coal and other commodities have skyrocketed since Russia's 24th February invasion of Ukraine, while sanctions on Moscow are forcing Western consumers to replace Russian supply. Palladium, used by automakers in engine exhausts to reduce emissions, hit a record high on Monday before easing back. Russia accounts for 25-30% of the world's palladium supply. Companies in Europe - which relies on Russia for 70% of its coal supplies - are also turning to Australian miners for supply of the fuel. In a sign of how tight the market is, coal prices for loading at Newcastle - the world's biggest coal port on Australia's east coast - rocketed to a record AUS$440 (£244.78) a tonne last Wednesday, a five-fold jump from a year ago.
 
Russian miners Polymetal and Evraz both say they have not been affected by sanctions imposed on Russia after its invasion of Ukraine. Polymetal said it was not owned by anyone connected to Russia under the definition of UK sanctions and that the scope of operational activities and production guidance remained stable, though it is reviewing nonessential capital projects to preserve liquidity and minimise risk. Evraz said yesterday: "Although the imposition of international sanctions against Russia and the restrictions imposed by Russia are creating certain frictions in supply, logistics and financial flows, to date there has been no material direct impact on day-to-day operations, trading or the financial position of Evraz".
 
The cost to multinationals pulling out of Russia, albeit temporarily in most cases, is becoming clear. McDonald's said the temporary closure of its 847 stores in the country would cost it $50 million (£27.99m) a month. Sportswear firm Adidas also quantified the cost of scaling back its operations, saying it would take a hit to sales of up to €250 million euros (£201.55m). US bank Citigroup has said it has almost $10 billion (£7.6bn) of total exposure in Russia and that in a "severe stress scenario" its loss might be half that. Italy's second-biggest bank, UniCredit says a full write-off of its Russian business would cost it around €7.4 billion (£6.22bn) and BNP Paribas said it had a total exposure of around €3 billion (£2.52bn) to Russia and Ukraine.
 
Nestle, Philip Morris, and Mondeleze International are the latest multinationals stepping back from Russia, Reuters reports, however all three say they will continue to provide essentials to country, with Mondelez aiming to help maintain "continuity" in the Russian food supply. Whiile cigarette maker Imperial Brands has suspended operations in Russia, rival Philip Morris says only that it will scale down manufacturing. British American Tobacco Plcmeanwhile says its business in Russia continues to operate, but capital investment has been suspended.  Sony, whose movie studio has already stopped releases in Russia, took additional action yesterday, saying its PlayStation gaming unit would stop shipments and operations in Russia. Heavy equipment maker Deere & Co announced it had ended shipments to Russia two weeks ago, and subsequently to Belarus. Caterpillar Inc said it was suspending business as supply chain disruptions and sanctions made business difficult and 3M followed suit after reassessing its business in Russia. A Rio Tinto executive early in the day said the miner was working to maintain supplies of Russian fuel to its Mongolian copper mine, but the company later announced it was terminating all commercial relationships with Russian businesses. Hotel companies Hilton Worldwide Holdings and Hyatt Hotels Corp said they would suspend development in Russia.
 
Tesla Inc will give Ukrainian employees asked to defend their country at least three months of pay, CNBC reported yesterday.
 
The "Executive Order on Ensuring Responsible Innovation in Digital Assets" was signed by US President Joe Biden yesterday. It requires US government agencies to officially recognise and regulate digital assets in the US; tasks the government with reviewing the technological infrastructure needed to roll out a central bank digital currency, or 'digital dollar;' and calls for officials to develop proposals on cryptoassets within 180 days. The order stresses the need to facilitate the responsible development of the cryptocurrency industry, whilst "combating illicit exploitation, and reducing negative climate impacts", phrasing which has lessened fears among crypto investors that the Biden administration would take a hard stance on the evolving crypto sector. More than 100 countries, including China and the UK, are currently exploring or piloting the use of digital currencies by central banks, for use both domestically and in cross-border transactions, the BBCsays.
 
Prime Minister Boris Johnson will visit a Merseyside dockyard today as he announces a £4 billion injection into the UK’s regional shipbuilding industry.The funding will support shipyards and suppliers across the UK, delivering a pipeline of more than 150 new naval and civil vessels, and create tens of thousands of jobs. Defence Secretary and Shipbuilding Tsar Ben Wallacesaid: “With significant government investment, we will be levelling-up across our shipbuilding, workforce, from shipyard to supplier, from procurement to designer, creating tens of thousands of new employment opportunities, boosting living standards and pay….and see a vital part of British industry expand and flourish”.
 
Broadcaster ITV is to buy a minority stake in carwow, Europe's largest new car marketplace, for £2.5m in return for advertising inventory. ITV will also have the option to invest a further £2.5m in the firm.
 
Stagecoach said yesterday that it no longer plans to recommend a £470m takeover by National Express. Instead the transport operator has agreed to be bought by an infrastructure fund managed and advised by DWS Infrastructure,in a £594.9m deal.
 
Life insurer and asset manager Legal & General has reported an 11% operating profit surge to £2.26bn, up from £1.60bn last year.
 
FTSE 250 technology-enabled payments solutions provider Network International said yesterday that full-year profits had shot up more than 900% year-on-year after new business momentum hit record levels under the guidance of new CEO Nandan Mer, Mastercard's former international markets strategy head. Profits at the UK-based company surged to $56.5m (£42.93) in the year ended 31 December, up from just $5.5m (£4.18) in 2020, as it pulled in 17 new customer deals with financial institutions in the period.
 
Brick and concrete products manufacturer Ibstock said yesterday that it swung to a full-year profit amid strong demand. In the year to the end of December 2021, the group swung to a statutory pre-tax profit of £65m from a loss of £24m a year earlier, with revenues rising to £409m from £316m.


Why Media is an award-winning design, marketing, digital communications and PR agency offering tailored solutions to companies on a global scale. We have extensive experience in delivering design and marketing services to a spectrum of companies including professional services, property companies, financial institutions and shopping centres. We have offices in London UK, Hertford UK, Finestrat ES & Brescia IT.


Marketing Contact

Name:  Claire White
E-Mail:  claire@whymedia.com
Telephone:  01992 586 507