The EconomistJuly 13th 2019 9
The world this week Business
DeutscheBankrevealedde-
tailsofa long-awaited€7.4bn
($8.3bn)restructuringplan.Its
investment-bankingdivision
willbearthebrunt.Thetrou-
bledlenderwillcloseitsglobal
equity-tradingunitandcut
18,000peoplefromits91,
workforce.It willalsocreatea
“badbank”tohouseunwanted
assets.ChristianSewing,
DeutscheBank’schiefexec-
utive,hopesthemovewillcut
costsby€6bna year.Analysts
respondedtotherestructuring
bysayingit waslongoverdue.Turkey’sPresidentRecep
TayyipErdogansackedMurat
Cetinkaya,thegovernorofthe
country’scentralbank,and
suggestedthattheinstitution
needsanoverhaul.MrCe-
tinkayawasapparentlyousted
forrefusingthepresident’s
requesttolowerinterestrates.
MrErdoganseeminglywants
greatercontrolofmonetary
policy,a stancethathasprevi-
ouslycontributedtorunson
theTurkishlira.Can hack it
Britain’s Information Commis-
sioner’s Office, a data-privacy
regulator, said it would fine
British Airways (ba) £183m
($230m) over a data breach last
summer. In June 2018 crimi-
nals hacked into ba’s website
and stole personal data, in-
cluding the names, addresses
and credit-card details of
around 500,000 customers. It
was the first fine Britain hand-
ed out under the eu’s new
General Data Protection Regu-
lation, which greatly increased
the size of potential penalties.
The second came the next day,
when Marriott, a hotel group,
was told it would be fined
£99m for a data breach discov-
ered last year. Both ba andMarriott said they would con-
test their penalties.Virgin Galactic said that it was
planning an initial public
offering. The firm, which
hopes to take its first paying
passengers into space early
next year, could be valued at
$1.5bn. Negotiations over a
$1bn investment from Saudi
Arabia’s sovereign-wealth fund
were ended last year after the
murder of Jamal Khashoggi, a
journalist, by Saudi operatives
in Istanbul.America began an investiga-
tion into France’s planned
digital-services tax. The
Trump administration says the
3% levy on the French revenues
of big internet firms unfairly
targets American companies
like Google and Amazon. Its
probe could result in America
imposing tariffs or other trade
restrictions. Several European
countries are mulling digital
taxes, though all say they
would prefer a global deal—
which the oecd, a club of rich
countries, is trying to broker.The Trump administration
said it would issue licences
allowing American companies
to sell their products to Hua-
wei, a Chinese technology
firm, provided that the sales do
not threaten national security.InMay,aftertradetalkswith
Chinacollapsed,Americahad
blacklistedtheChinesetele-
comsfirmoversecuritycon-
cernsrelatedtoitslinkstothe
CommunistPartyofChina.
PresidentTrumpagreedto
allowHuaweitoresumesales
toAmericanfirmslastmonth.Rocket man
America’s stockmarkets soared
after Jerome Powell, the chair-
man of the Federal Reserve,
hinted that the central bank is
looking to cut interest rates
this month. Investors piled
into shares after Mr Powell
cited concerns that the trade
war with China and a global
slowdown could hurt growth
in America. The s&p500 index
of shares touched 3,000 for the
first time.Mr Powell also warned that
plans by Facebookto build a
digital currency called Libra
raise “serious concerns”. The
central banker told America’s
House of Representatives that
Facebook should address fears
about privacy, money launder-
ing, consumer protection and
financial stability before mov-
ing forward with the project.
Several executives at the social
network are scheduled to be
questioned by Congress later
this month.A profit warning from basf,
the world’s largest maker of
chemicals, weighed heavily on
the German stockmarket. The
company slashed its forecast
for full-year earnings by 30%.
In response its share price slid
by 5%. The company blamed a
global economic slowdown,
caused by the trade war be-
tween America and China, as
well as a “particularly strong”
downturn in car manufactur-
ing, for the downgrade.A Brazilian judge ordered Vale,
a mining giant, to pay full
compensation for damage
caused when one of its dams in
the north of the country broke
in January, killing at least 248
people. Vale must stump up for
all the effects of the disaster,
including the cost of the eco-
nomic hit to the region. The
judge said it was still not pos-
sible to calculate a final figure
for the total amount Vale will
have to pay.