The London listing for Chinese fast fashion group Shein effectively died in January.
The decision to send the group’s general counsel Yinan Zhu into bat before Parliament’s business and trade select committee was a howler.
MPs may be a bit short of business and City acumen, but they could see a dud.
Labour chairman Liam Byrne noted at the time: ‘You’ve given us zero confidence in the integrity of your supply chains.’
A Shein listing in London in the first half of this year was always going to be contentious. It is alleged that the cotton in garments comes from Xinjiang, home to an oppressed Uyghur minority.
Due to the enthusiasm of the Labour government and London listing authorities to bring the shares of a tech-savvy textile group to the UK – in a possible £36billion offer – niceties were overlooked.
Supply chain: It is alleged that the cotton in some of Shein’s garments comes from Xinjiang, home to an oppressed Uyghur minority
The reality is that permission for the overseas listing from the state-controlled China Securities Regulatory Commission was not forthcoming.
A Hong Kong float is now the front-runner with Beijing unlikely to object to a share sale in a territory where it is in full control.
Donald Trump’s trade wars have not helped. The Americans proposed a de minimis tariff of 150 per cent on small parcels from China, subsequently slashed to 54 per cent.
In April, Chancellor Rachel Reeves announced a review of tax-free small packages with a value of less than £135.
The switch to Hong Kong is another setback for the London Stock Exchange, which is losing out to New York and Amsterdam for initial public offerings.
It is also a jolt to Labour’s tilt towards China. A January trade trip to Beijing, led by the Chancellor, delivered a modest return of just £600million over five years – negligible in terms of UK trade in the Pacific.
It was also an opportunity to press the case for Shein coming to London. The kowtow failed.
Silver surfer
Among the most striking figures in global finance, Christine Lagarde is never short of ambition.
The former French finance minister, who served under president Nicolas Sarkozy, has never been held back by a conviction for ‘negligence’ in office in 2016.
In 2019 Lagarde stepped down as managing director of the International Monetary Fund two years early, after she was drafted to become president of the European Central Bank (ECB).
She has steered it through the Covid pandemic and Russia’s war on Ukraine, when inflation peaked at 10.6 per cent in November 2022.
Under her, Europe’s inflation rate has come down to 2.6 per cent as the eurozone’s biggest economies, Germany, France and Italy stagnated.
The ECB has been more aggressive than its Western counterparts in lowering interest rates from a post-Ukraine peak of 4.5 per cent to 2.5 per cent.
The 69-year-old central banker could be on the move again before her term expires in 2027.
The founder and former head of the Davos World Economic Forum, Klaus Schwab, who is under investigation for alleged misconduct (which he denies) has said Lagarde has been tapped up to be Davos chairman.
Practical arrangements have been made, including an apartment in Switzerland. Lagarde has reportedly told colleagues that she will not leave until inflation has returned to the ECB’s 2 per cent target.
The disclosure will kick off manoeuvres among Europe’s kingpin economic leaders. France is never short of candidates when it comes to rippling muscles on the global stage.
Sunshine state
French political sage Montesquieu came up with the idea that climate determines political systems.
Rachel Reeves should take note and hope that the sun continues to shine.
DIY retailer Kingfisher, owner of B&Q, Screwfix and Castorama in France, enjoyed sales in the UK surging 5.9 per cent in the three months to April.
Market researcher Kantar reports sales of barbecue meats soared by 27 per cent in the four weeks to April. Potato salad, coleslaw and sunscreen flew off the shelves.
Most grocers, except for private equity-owned Asda, gained market share. If this carries on, consumers may well soothe the Chancellor’s growth troubles.
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