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Faced with a generational triple challenge of delivering a carbon-neutral economy, energy security, and the multi-trillion-pound investments required to make it happen, the government has draped its green ambitions in red, white and blue.

The energy security plan (official title “Powering Up Britain’) is awash with Union flags. From the agency that will develop atomic energy, Great British Nuclear, to the programme to improve domestic energy efficiency, Great British Insulation, it feels like a patriotic rebranding of existing plans and consultations, with very little new money.

It may be a matter of presentation, but it’s a mistake to view the race to net zero as a parochial issue. This is a global competition for technology, innovation, skills and investment. When it comes to money, Britain already finds itself outmuscled by global competitors.

Last August, US President Joe Biden announced the Inflation Reduction Act (IRA) – a $369bn subsidy plan to secure green industrial investment.

The financial incentives to move factories and development to the US are already turning heads in Britain, with the domestic car industry particularly vulnerable as it transitions to an all-electric future.

The European Union has responded to this huge protectionist move with one of its own. A response that could be worth €250bn in subsidies is being finalised in Brussels.

The UK of course would once have benefitted from collective European muscle flexing, but now it poses yet more competition, and much closer to home.

Faced with two industrial giants engaged in a transatlantic arm-wrestle, the UK has effectively said it cannot compete.

Can being smart make up for being small?

Instead of trying to keep up in a subsidy race, Chancellor Jeremy Hunt is hoping being smarter will make up for being smaller, helped by the financial clout of the City of London.

Writing for The Times today, he is explicit: “Our approach will be different – and better. We are not going toe-to-toe with our friends and allies in some distortive global subsidy race.”

Rather than fight a subsidy battle he thinks he is destined to lose, the chancellor hopes the City, and UK innovation, can deliver the investment, skills and jobs required to transform energy supply and the economy.

He cites planned reforms of insurance regulation as allowing investors to free up some of an estimated £100bn in capital for green industries.

To put that in perspective, the Treasury’s own estimate is that the UK requires £60bn a year to hit domestic net-zero targets, and the chancellor has already cited the same reforms as the resource for science and tech investment.

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There is some state funding for green technologies in this announcement, though very little we did not already know about. Some £20bn will go towards Carbon Capture, Utilisation and Storage (CCUS) projects, a nascent technology still unproven at scale.

Much smaller pots will be aimed at green hydrogen, which has industrial applications that might in time help decarbonise the energy transition’s huge demand for steel, as well as for insulation and setting up Great British Nuclear.

A generous direct subsidy is hard to beat

Yet even with a little state help and a favourable private sector investment environment, a generous direct subsidy is hard to beat. Volkswagen, for example, has already paused its European battery plant plans until it hears whether the EU can match a $10bn subsidy from the US.

The green transition is an opportunity for growth as well as a challenge. As every developed economy turns its attention to the energy transition the Treasury estimates it could be worth £1trn to UK business by 2030.

And there are huge investments required at home, starting with the expansion of the electricity grid to distribute huge volumes of new renewable energy, all of which will require cables to go under or over communities, and through the labyrinthine planning system.

The UK is already importing the green transition

The UK does have advantages in fundamental green industries. Geography has bestowed extensive coastal waters where wind power and expertise flourishes, with floating wind farms the next frontier. Yet the Crown Estate benefits from the licences (through ownership of the seabed) and many of the companies delivering the infrastructure are Scandinavian, demonstrating that the UK is already importing the green transition.

Unless flag-waving becomes a renewable energy source it will take more than patriotism to keep up in this global race.

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Burberry checks out contenders to replace Murphy as chairman

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Burberry checks out contenders to replace Murphy as chairman

Burberry is kicking off a formal search for a new chairman nearly a year after installing the latest in a string of chief executives charged with reviving the luxury fashion brand.

Sky News understands that Burberry is working with headhunters on a hunt for Gerry Murphy’s successor.

Mr Murphy, who also chairs Tesco, is not expected to step down this year, although the precise timing has yet to be formally determined, according to insiders.

Last summer, Sky News reported that Burberry had commenced a search for a non-executive director capable of taking over from Mr Murphy in due course.

That mandate is now said to have evolved into a more straightforward hunt for a new chair, sources suggested.

Planning for his departure comes as Burberry and other luxury goods manufacturers grapple with the uncertainty of swingeing tariffs amid an escalating international trade war.

The company is now being run by Joshua Schulman, the former Jimmy Choo boss, who was drafted in last July to arrest its decline.

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Mr Schulman replaced Jonathan Akeroyd, who left in the wake of a string of profit warnings.

Shares in Burberry closed on Tuesday at 738.8p, giving it a market value of about £2.6bn.

The stock is down by more than a third over the last year.

A spokesperson for Burberry said: “In the normal course of business, we look at succession planning for board roles as they reach term.”

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Food inflation highest in almost a year – more to come, industry warns

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Food inflation highest in almost a year - more to come, industry warns

Food inflation has hit its highest level in almost a year and could continue to go up, according to an industry body.

The British Retail Consortium (BRC) reported a 2.6% annual lift in food costs during April – the highest level since May last year and up from a 2.4% rate the previous month.

The body said there was a clear risk of further increases ahead due to rising costs, with the sector facing £7bn of tax increases this year due to the budget last October.

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It warned that shoppers risked paying a higher price – but separate industry figures suggested any immediate blows were being cushioned by the effects of a continuing supermarket price war.

Kantar Worldpanel, which tracks trends and prices, said spending on promotions reached its highest level this year at almost 30% of total sales over the four weeks to 20 April.

It said that price cuts, mainly through loyalty cards, helped people to make the most of the Easter holiday with almost 20% of items sold at respective market leaders Tesco and Sainsbury’s on a price match.

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Its measure of wider grocery inflation rose to 3.8%, however.

Wider BRC data showed overall shop price inflation at -0.1% over the 12 months to April, with discounting largely responsible for weaker non-food goods.

But its chief executive, Helen Dickinson, said retailers were “unable to absorb” the surge in costs they were facing.

“The days of shop price deflation look numbered,” she said, as food inflation rose to its highest in 11 months, and non-food deflation eased significantly.

“Everyday essentials including bread, meat, and fish, all increased prices on the month. This comes in the same month retailers face a mountain of new employment costs in the form of higher employer National Insurance Contributions and increased NLW [national living wage],” she added.

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Five hacks to beat rising bills

While retail sales growth has proved somewhat resilient this year, it is believed big rises to household bills in April – from things like inflation-busting water, energy and council tax bills – will bite and continue to keep a lid on major purchases.

Also pressing on both consumer and business sentiment is Donald Trump’s trade war – threatening further costs and hits to economic growth ahead.

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A further BRC survey, also published on Tuesday, showed more than half of human resources directors expect to reduce hiring due to the government’s planned Employment Rights Bill.

The bill, which proposes protections for millions of workers including guaranteed minimum hours, greater hurdles for sacking new staff and increased sick pay, is currently being debated in parliament.

The BRC said one of the biggest concerns was that guaranteed minimum hours rules would hit part-time roles.

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Inside the Vietnamese factory preparing for the worst since Trump’s tariff threat

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Inside the Vietnamese factory preparing for the worst since Trump's tariff threat

On the outskirts of Ho Chi Minh City, factory workers at Dony Garment have been working overtime for weeks.

Ever since Donald Trump announced a whopping 46% trade tariff on Vietnam, they’ve been preparing for the worst.

They’re rushing through orders to clients in three separate states in America.

Sewing machines buzz with the sound of frantic efforts to do whatever they can before Mr Trump’s big decision day. He may have put his “Liberation Day” tariffs on pause for 90 days, but no one in this factory is taking anything for granted.

Staff have been working overtime
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Staff have been working overtime

Workers like Do Thi Anh are feeling the pressure.

“I have two children to raise. If the tariffs are too high, the US will buy fewer things. I’ll earn less money and I won’t be able to support my children either. Luckily here our boss has a good vision,” she tells me.

Do Thi Anh
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Do Thi Anh

That vision was crafted back in 2021. When COVID struck, they started to look at diversifying their market.

Previously they used to export 40% of their garments to America. Now it’s closer to 20%.

The cheery-looking owner of the firm, Pham Quang Anh, tells me with a resilient smile: “We see it as dangerous to depend on one or two markets. So, we had to lose profit and spend on marketing for other markets.”

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You asked, we listened, the Trump 100 podcast is continuing every weekday at 6am

That foresight could pay off in the months to come. But others are in a far more vulnerable state.

Some of Mr Pham’s colleagues in the industry export all their garments to America. If the 46% tariff is enforced, it could destroy their businesses.

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Doubts US will start making what Vietnam delivers

Down by the Saigon River, young couples watch on as sunset falls between the glimmering skyscrapers that stand as a testament to Vietnam’s miracle growth.

Cuong works in finance
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Cuong works in finance

Cuong, an affluent-looking man who works in finance, questions the logic and likelihood that America will start making what Vietnam has spent years developing the labour, skills and supply chains to reliably deliver.

“The United States’ GDP is so high. It’s the largest in the world right now. What’s the point in trying to get jobs from developing countries like Vietnam and other Asian nations? It’s unnecessary,” he tells me.

But the Trump administration claims China is using Vietnam to illegally circumvent tariffs, putting “Made in Vietnam” labels on Chinese products.

There’s no easy way to assess that claim. But market watchers believe Vietnam does need to signal its willingness to crack down on so-called “trans-shipments” if it wants to cut a deal with Washington.

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Vietnam can’t afford to alienate China

The US may also demand a major cutback in Chinese manufacturing in Vietnam.

That will be a much harder deal to strike. Vietnam can’t afford to alienate its big brother.

Luke Treloar, head of strategy at KPMG in Vietnam
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Luke Treloar, head of strategy at KPMG in Vietnam

Luke Treloar, head of strategy at KPMG in Vietnam, is however cautiously optimistic.

“If Vietnam goes into these trade talks saying we will be a reliable manufacturer of the core products you need and the core products America wants to sell, the outcome could be good,” he says.

But the key question is just how much influence China will have on Vietnamese negotiators.

Anything above 10-20% tariffs would be intensively challenging

This moment is a huge test of Vietnam’s resilience.

Anything like 46% tariffs would be ruinous. Analysts say 10-20% would be survivable. Anything above, intensely challenging.

But this looming threat is also an opportunity for Vietnam to negotiate and grow. Not, though, without some very testing concessions.

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