42 1GM Wednesday December 2 2020 | the times
Business
through the pandemic have been
among the most expensive in the world,
but the OECD said that the money may
not have been well spent.
“A striking feature of the outlook is
the absence of correlation between the
extent of fiscal support and the result-Britain set to lag the world
in post-pandemic recovery
Economic recovery in Britain next year
will be among the slowest in the world,
despite government support in the pan-
demic that has cost more than almost
every other leading nation.
In a desperate picture for national
income and the public finances laid out
in forecasts by the Organisation for
Economic Co-operation and Develop-
ment, global GDP is projected to have
returned to its late 2019 level by the end
of 2021, but the UK will remain more
than 6.4 per cent smaller.
Only Argentina, with a 7.9 per cent
shortfall, fares worse under OECD
forecasts for a selection of 20 countriesand the eurozone. By the end of 2021,
the United States will have recovered
all but 0.1 per cent, according to the
forecasts; Germany, Japan, Canada and
France will be about 2 per cent short of
2019 levels and Italy is set to be 4 per
cent lower. China is expected to be
9.7 per cent larger.
Altogether, the OECD’s outlook forBritain is grim. The Paris-based think
tank expects the UK to shrink by
11.2 per cent this year, the deepest
recession of all advanced G7 nations,
before growing by 4.2 per cent and
4.1 per cent in 2021 and 2022, respec-
tively. Growth for this year and next has
been downgraded since September
because of the lockdown.
Unemployment is expected to peak
at 7.5 per cent and to average 7.4 per cent
for 2021, leaving an additional million
people out of work. Britain is predicted
to be 2 per cent smaller at the end of
2022 than it was in the final quarter of
2019.
The forecasts are more pessimistic
than those released last week by the
Office for Budget Responsibility. The
government’s independent spending
watchdog expects UK national income
to recover to 2019 levels by the end of
2022 and employment to rebound
more quickly.
The OECD’s pessimism is based on
projections for weak household
consumption and an almost complete
lack of business investment, which has
fallen by a fifth during the pandemic.
Under the OECD outlook, it is 15 per
cent lower at the end of 2022 than it was
in 2019.
Brexit is blamed for the sluggish
recovery, as uncertainty lingers and the
country loses foreign direct invest-
ment. “The UK is at a critical juncture,”
the OECD said. “Uncertainty sur-
rounding Brexit is continuing to weigh
on growth prospects. Increased border
costs will weigh on imports and exports.
Private investment will recover only
slowly due to elevated uncertainty.”
Government support schemes this
year to help people and companiesPhilip Aldrick Economics Editor
Robert Lea Industrial Editor
Gardaworld is set to increase its take-
over offer for G4S by at least 15 per cent,
raising the hostile bid for the giant
security company from 190p a share to
220p or more.
Today is the 46th working day after
the original offer of almost £3 billion
and, under takeover rules, the
last day on which a bidder
can submit a revised
proposal.
“Gardaworld won’t
win if they don’t
raise their offer,”
one analyst told
Bloomberg last
night.
Shares in G4S
were languishing at
145p when Garda-
world, a smaller
Canadian rival, indi-
cated in September that
it would launch a bid. They
have been rising steadily in the
past month amid an expectation of a
raised offer. Yesterday they climbed 8p,
or 3.6 per cent, to 229p, valuing G4S at
£3.6 billion.
Gardaworld has received minimal
take-up from G4S shareholders for its
190p-a-share offer, which most have
taken as a sighting shot.
However, from the outset it has been
suggested by analysts that if GardaG4S braces for an increased
bid as deadline approaches
were to offer about 220p a share, lead-
ing investors may become interested.
The share price has risen as investors
have bet on Allied Universal, an Amer-
ican rival, also getting involved.
News of Allied Universal’s interest
has been in short supply ever since it
emerged that if it were to launch a
counterbid for G4S, the combination of
the two companies in the
American market was
likely to attract the
attention of competi-
tion regulators.
G4S, with more
than 500,000
employees in 80
countries bringing
in £7 billion of
annual revenues,
is the world’s larg-
est security group.
However, it has suf-
fered several reputa-
tional setbacks, not least
a scandal involving over-
charging the Ministry of Justice
for the tagging of offenders and the fail-
ure to recruit enough staff to guard the
2012 Olympic Games in London.
Ashley Almanza, 57, G4S’s chief
executive, has defended the company’s
poor share price performance by argu-
ing that it is locked into a seven-year
reform strategy and is at an “inflection
point” in its recovery. Garda has dis-
missed this defence.r rules, the
bidder
isedt
er
di-
that
d. They
adily in the
n expectation of athe two com
American
likely
atten
tion
G
th
em
c
in
an
is
est
How
ffered
ttional s
a scandal
charging the M
forthe tagging of offenBottom line
GDP in Q4 2021 relative to Q4 2019
9.74
China
1.63
Korea
1.46
Indonesia
0.59
World
0.41
Turkey
0.23
Russia
0.08
US
-0.27
Australia
-0.48
Saudi Arabia
-1.26
Japan
-1.75
Germany
-2.06
Canada
-2.25
France
-2.99
Euro area
-3.26
India
-3.45
Brazil
-3.88
Italy
-4.16
South Africa
-4.34
Mexico
-6.36
UK
-7.92
Argentina