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Friday Newspaper Review - Irish Business News and International Stories - - August 29, 2014
By Finfacts Team
Aug 29, 2014 - 11:03 AM

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Irish Independent

The US economy expanded more than previously forecast in the second quarter, propelled by the biggest gain in business investment in more than two years, which bodes well for the rest of 2014.

Gross domestic product rose at a 4.2pc annualised rate, up from an initial estimate of 4pc and following a first-quarter contraction, Commerce department figures showed yesterday in Washington. The median forecast of 77 economists surveyed by Bloomberg called for a 3.9pc gain. Corporate profits climbed by the most in almost four years.

The improvement has carried over into the second half with companies such as General Electric seeing more orders for equipment and a strengthening job market underpinning consumer spending, which accounts for about 70pc of the US economy.

Better prospects for growth signal Federal Reserve officials will continue to wind down monthly asset purchases.

Irish Distillers' successful Jameson brand is powering ahead in export markets including the US, but the industry is slowing at home.

Sales of Jameson reached 4.7 million cases in the full year 2013-2014, the company said. That is 9pc higher than the previous year, both globally and in the US, its biggest single market. By price, the gain was 12pc.

However, the company said sales of all spirits are down 11.5pc in the home market.

Pub sales, the so-called "on" trade, is down 6pc and off-trade sales have declined by 13.9pc in terms of volume, Irish Distillers said, citing research from Neilson.

Sean Mulryan's Ballymore Group is back in profit for the first time since the crash. The Irish construction group is now on course to exit Nama by the end of the financial year with its loans paid off in full.

The group has repaid €1bn to Nama and other lenders since the downturn and is back building in Ireland after focusing on London during the crash at home.

The group generated a profit after interest and tax in the year to the end of March of €43.2m - its first profit since 2008, according to the latest set of accounts.

That was primarily driven by a 73pc increase in turnover.

"Ballymore has come through a very difficult period in our 35 year history. It is a cyclical business. However, the last downturn was no ordinary trading cycle. Ballymore restructured immediately and implemented a business plan in conjunction with Nama and our other financial institutions such as Ulster Bank," Paul Keogh, Ballymore's chief operating officer, told the Irish Independent.

Irish Times

West Pharmaceutical Services, a $3 billion New York Stock Exchange-listed pharmaceutical firm, is in talks with the IDA about making an investment of hundreds of millions in the southeast creating hundreds of new jobs.

The talks are understood to be at an advanced stage and initially West Pharma is understood to be looking at investing a figure in the region of €100 million in the southeast.

However, the scale of the 45 acre site would give West Pharma the ability to rapidly ramp up its investment by up to tenfold over a period of years as the rapidly growing multinational’s needs expand.

Peace, love and harmony – that’s our thing. Honestly. But, oh my, I opened a can of worms last week when I reported some choice comments by Ryanair’s Michael O’Leary about Christoph Mueller, the chief executive of Aer Lingus.

O’Leary is well known for a rambunctious attitude towards AL, which often keeps a polite distance. However, Declan Kearney, AL’s head of communications, is strongly disputing O’Leary’s comments.

“Aer Lingus is well used to Michael O’Leary’s frequent outbursts, which are not always rooted in reality, however sometimes we need to set the record straight. Despite these noisy distractions our focus remains on continuing our success as Ireland’s quality airline,” said Kearney.

Chris Johns: Economists often complain that they can’t do laboratory experiments, something which explains why the profession only pretends to be a science. Because evidence – data – is so sparse, many controversies remain unsettled. However, the current extraordinary developments in the British labour market might be one occasion where we can point to definitive results of an unusual lab-style investigation.

The number of jobs created by the British economy over the past few years has astonished everybody. And it is not just a story about what happened during the recovery from the financial crisis: the rise in unemployment during the recession was muted – it was less than forecast and stands in stark contrast to the experience of the euro area. For each percentage point of GDP lost by Britain during the downturn, it shed fewer jobs than virtually any other country.

Irish Examiner

Hibernia REIT and IPUT plc both concluded residential and commercial property deals as activity ramps up to take advantage of a recovering market.

Hibernia REIT has signed a contract with JJ Rhatigan & Company for the fit-out and completion of Hibernia’s 213 partially completed apartments in Block 3.

Hibernia said the cost to complete the apartment block is expected to be less than €25m. The first apartments will be available to let by mid-2015 and the project will be fully completed by the end of 2015.

Hibernia said it remains in exclusive discussions to acquire Cumberland House and has provided the owners with a short-term loan of €38m, fully secured on Cumberland House, with an interest rate of 6%.

Europe

Euro Topics:  Finland and Sweden on path to Nato membership: Sweden and Finland will sign a host nation support agreement with Nato within the next weeks. This will enable the Alliance to deploy troops to the two Nordic countries, which will then be tasked with their maintenance and logistics. Nato membership is moving closer, the liberal Finnish daily Etelä-Suomen Sanomat comments: "No doubt about it, even if the host nation agreement deepens both Finland's and Sweden's ties to Nato, it still doesn't make them members of the military alliance. And as long as they don't belong to Nato they can't hope for any security guarantees. Nonetheless, the host country agreement shouldn't be underrated. By improving the conditions for taking in and supplying Nato troops in a crisis it makes Finland and Sweden more compatible with Nato. This makes the path to Nato membership and the security guarantees it entails shorter than it was."

France needs a dose of Thatcherism: Three prominent representatives of the left wing of France's Socialist party have been left without seats in the cabinet following the reshuffle. Now Paris must implement reforms without further delay, the left-liberal UK daily The Independent urges: "Hollande and his new team need some radically different policies if they are to succeed. ... As Sarkozy could at least recognise, France, like much of the rest of the eurozone, desperately needs to free up her labour market; to shrink the size of the state; to relieve business of burdensome regulation; and to scrap her chauvinistic industrial policy, which deters foreign investment. A dose, in other words, of Anglo-Saxon Thatcherism as well as the 'German' austerity is required - alien notions feared and loathed across France."

Global perspectives: IS more dangerous for Mid East than for West: The growing power of the IS militias in Iraq and Syria poses a far greater threat to the people of the Middle East than to those in the West, columnist Sunny Hundal writes on the blog of the Arabic news channel Al Jazeera: "In the eyes of many jihadis, the Islamic State has established the most successful and feared caliphate in recent history. That in itself has spurred many to join it. The immediate goal of the Islamic State is to forcefully take over other Arab states and bring their subjects under their own banner. The murder of Americans such as James Foley is meant to shock the world, to bring attention and attract more support. But make no mistake: The real threat from the Islamic State is to other Muslims in the Middle East. Sooner or later people across the Middle East will have to face up to this threat."

 


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