The Economist - UK (2021-11-20)

TheEconomistNovember20th 2021 9
The world this week Business

Shellannounced a big change
to its corporate structure, with
plans to move its tax residency
from the Netherlands to Brit­
ain, dump its dual­share struc­
ture and remove the legacy
“Royal Dutch” from its legal
name. The oil giant is under
pressure to increase returns to
investors. Relocating its tax
base to Britain gives it more
freedom on share buy­backs.
Shell is keeping several big
divisions, such as global up­
stream, in the Netherlands.
Nevertheless the Dutch gov­
ernment said it was “unpleas­
antly surprised” by the news. 

Toshibalaid out formal pro­
posals to split into three pub­
licly listed companies, a move
that came soon after General
Electric’s similar decision to
split. The Japanese conglomer­
ate wants to house its nuclear,
infrastructure and engineering
businesses in one company,
create an asset­management
firm that will oversee its tech
holdings in another, and start a
new company for its chips and
small devices. Some share­
holders want Toshiba to sell
itself to a private­equity buyer
instead. 

Meanwhile,Johnson & John-
son, another huge conglomer­
ate, said it would spin off its
consumer­health division into
a separate business, leaving it
to focus on pharmaceuticals
and medical devices. 

Natural­gas prices surged in
Europe again, after Germany’s
energy regulator temporarily
suspended its certification of
the new Nord Stream 2pipe­
line, which is to transport
Russian gas to western Europe.
More Russian supplies would
ease the continent’s energy
crunch, but the regulator said
that the pipeline’s operator
was not in a “legal shape com­
pliant with German law”. 

Japan’s economyshrank by
0.8% in the third quarter com­
pared with the previous three
months, a blow for Kishida
Fumio, the new prime min­
ister, ahead of his announce­
ment of a big stimulus pack­
age. Business investment

plungedinthequarter,as

globalsupply­chainproblems

hitthecountry’sexporters.

Consumerspendingalsofell

amida resurgenceofcovid­19.

Britain’sannualinflationrate

jumped to 4.2% in October, the

highest level in a decade and

up from 3.1% in September.

This was mostly because of

higher energy costs and sup­

ply­chain shortages, but a

tightening labour markethas

added to inflationary pres­

sures. The number of people in

employment rose sharply in

October, allaying fears that

many of the 1m still on the

government’s furlough

scheme, which ended in Sep­

tember, would lose their jobs.

Record job­vacancy rates

persist, which often leads to

higher wages to attract staff. 

Joe Biden accused oil and gas

companiesof “anti­consumer

behaviour”, alleging they were

rampinguppetrolpricesfor

profit,andaskedtheFederal

TradeCommissiontoinvesti­

gate.Thepresidentisunder

politicalpressureasa resultof

surgingpricesatpetrolpumps.

Whatsupply-chaincrisis?

Walmartreporteda bumper

quarterforsales,andsaidits

shelveswouldbefullystocked

fortheChristmasshopping

season.Theretailerhasfound

thatshoppersaregradually

returningtopre­pandemic

habits,withmoreofthem

visitingphysicalstoresthana

yearago.Targetissueda simi­

lar earnings report. 

Just a week after its ipo,

Rivian, a maker of electric

vehicles backed by Amazon,

reached $153bn in market

capitalisation, overtaking

Volkswagen in value. Its share

price then dived by 15%, wip­

ing out its lead over vw. Lucid,

which produces luxury electric

cars, passed Ford in market

value. Rivian and Lucid have

yet to make a profit, but in­

vestors are betting that the

companies’ shares will per­

form as well as Tesla’s, though

they could also be as volatile. 

The British government or­

dered a full investigation into

Nvidia’sproposed acquisition

ofArm, a Britishchip­design­

er,inpartonnational­security

grounds.Nvidia,America’s

mostvaluablesemiconductor

manufacturer,laterrevealed

thatAmerica’sFederalTrade

Commissionhas“expressed

concerns”aboutthedeal,

whichisalsobeinginvestigat­

edintheEuropeanUnion.

AstraZenecaislookingto

make“modest”profitsfrom

newordersofitscovid­

vaccine.Thedrugmaker

produceditsvaccinein

collaborationwithOxford

University,andhasbeensell­

ingit withouta profitmargin

(unlike rival firms). Its doses

have been used mostly in

Europe, but also in developing

countries, where it will still be

sold at cost. 

Therighttobedisconnected

News sites pored over the

recent approval of a law in

Portugal that bans employers

from contacting their staff

outside working hours,

including by email. Compa­

nies will also have to pay some

of the cost of remote working,

such as an employee’s higher

energy bills, and cannot mon­

itor home workers in any way.

Office workers in Portugal have

nothing to lose, it seems, but

their email chains. 

Consumer prices

% change on a year earlier

Source:Nationalstatistics

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• 1715132011 2119

United States

Euro area

Britain