Today's business and finance round up 12th January 2022
🌎World Bank predicts greater global inequality
12th January 2022
Bite-sized business news from the UK and beyond
Good morning With temperatures dropping many people are searching for advice to keep warm. But Britain’s third largest energy supplier, Ovo, has apologised after it gave cringeworthy tips to customers including ‘cuddling with your pets' and doing 'a few star jumps' to stay warm and save on heating bills.
World Bank predicts greater global inequality
Private equity giants eye Boots takeover
ECONOMYWorld Bank predicts greater global inequality
What’s going on?This year global economic growth will slow down with poorer nations falling further behind richer countries, that’s according to the World Bank’s latest 2022 outlook report.The organisation expects growth to trend down from 5.5% in 2021 to 4.1% in 2022 and 3.2% in 2023, driven by continued Covid flare-ups, lower government support and ongoing supply chain issues.
Why is this important?
The latest forecasts from the World Bank make for pretty grim reading. The organisation warned that the global economy is entering a phase of “pronounced slowdown” due to the spread of Omicron, surging inflation, high government debt levels and rising income inequality.The bank’s purpose is to grant loans to developing countries to fund projects intending to lift them out of poverty.Throughout the pandemic, the bank has raised concerns over the growing levels of inequality between the richest and poorest nations – and its latest outlook is no exception.During the pandemic the rich got richer with soaring stock markets and house prices. At the other end of the spectrum poorer nations have struggled to recover and are hampered by lower vaccination rates and lower-resourced governments. While developed economies are expected to surpass their pre-pandemic levels this year, poorer economies will still be 4% smaller. The bank says that developed countries are in a stronger position to recover from the pandemic as they have higher vaccination rates and more generous government support compared to the rest of the world. Rich nations are also more able to tackle bottlenecks in global supply chains and afford the current surge in the price of raw materials and production.
TakeawayThe World Bank’s warned that the post-pandemic world will be more unequal unless more is done to bridge the gap between the richest and poorest. It’s called for more global cooperation to distribute vaccines more fairly and to ease the debt burden on developing countries.
HEALTHPrivate equity giants eye Boots takeover
Bain Capital and CVC, two of the world's biggest private equity firms, are rumoured to be joining forces to bid for Boots.It comes just weeks after the high street pharmacist’s owner lined up advisers to sell the business for as much as £10bn.American health group Walgreens has owned 172-year old Boots since 2014 and rumours have been circulating since October that it was considering selling the chain or listing it on the stock market.With a footprint of 2,200 stores and 55,000 staff, Boots is one of the biggest high street retailers in the country and one of the biggest private sector employers.Consumer behaviour has accelerated towards online shopping during the pandemic and owning a business with such a vast store portfolio could put a dampener on the value. But Bain is thought to be interested in developing Boots’ ecommerce beauty and healthcare services.The sale of Boots would be among the most major consumer retail deal for years. Given its close links to providing NHS services, a sale would also draw a lot of attention from the government and public.
Stat of the day
Heathrow airport has said at least 600,000 passengers cancelled their travel plans from the airport in December because of Omicron
Other stories to keep you in the loop
Strong retail sales in December despite Omicron onslaught
£150,000 starting salaries as firms fight for staff
Uber rival Bolt raises $711m at valuation of over $8bn
UK book sales in 2021 highest in a decade
Grand Theft Auto developer buys FarmVille maker for $13bn
No goggles required: ‘Tearless’ onions go on sale in UK supermarkets
Interesting links from around the web
The 10-year-old on track to retire by 15
The people going through January without spending a penny
The world’s safest airline has been named