Chinese manufacturers receive nine times more government support than their Western counterparts, according to calculations from the Organisation for Economic Co-operation and Development (OECD) which help explain the country’s complete dominance in so many sectors, from solar panels and batteries to steel.

The figures produced by the OECD show that Chinese businesses benefit from government subsidies equivalent, on average, to 3.7% of their revenues. This compares to average state aid of only 0.4% of revenues for countries in the rich world.

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The data are a critical part of the explanation for Chinese dominance in certain fields, not to mention part of the explanation for why the UK has seen its manufacturing base shrink so rapidly in recent years.

While China provides large amounts of assistance to key sectors, including its solar photovoltaic sector and base metals producers of aluminium and steel, UK governments have for decades tended to be considerably less interventionist. The upshot is that the UK has seen many plants closing, unable to compete with cheap imports.

Up until now there has been no definitive measure of how much those cheap imports have been influenced by what economists call “state aid” – whereby governments help their companies.

In part this is because measuring state aid is fiendishly difficult.

At its simplest, it can take the form of direct grants from governments, to support a company or help it to build a plant. However, some countries are less transparent than others about these grants. But arguably more important are special low taxes sometimes charged to specific companies or sectors, and lower-than-market interest rates which are sometimes offered to favoured firms.

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The OECD analysis, which has yet to be published as a formal report for widespread release, is the most comprehensive attempt yet to quantify those various types of state aid and compare different regions to each other.

Its finding, that China provides significantly more state aid for its manufacturers, is unlikely to come as a surprise – but it provides a statistical backbone for arguments that the global trading system does too little to confront these interventions.

It also finds that the amount of state aid varies significantly from sector to sector, with aluminium smelters, cement manufacturers and solar cell plants receiving most assistance. However, the report pre-dates the rapid increase in Chinese production of batteries in recent years.

Under Joe Biden, the US has introduced a host of measures, from the CHIPS Act to the Inflation Reduction Act, designed to provide subsidies for those making semiconductors and green technology in the US.

However, even after those interventions, total state aid in the US is still likely to be short of the Chinese total.

The US central bank, known as the Fed, has again kept interest rates high – at 5.25% to 5.5%.

It comes despite the policymaker signaling in January that interest rate cuts were around the corner.

Progress in bringing down rates and making borrowing cheaper has been hampered by rising inflation in the US.

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It could now be that US rates are only cut once in 2024, less than had been expected, as high rates are deemed necessary to take money out of the economy and slow the pace of price rises.

Data released last week showed inflation grew 3.5% in March, up from 3.2% in February and 3.1% in January – above the Fed’s inflation target and higher than economists expected.

Inflation falls are not guaranteed Mr Powell said on Wednesday, “Further progress in bringing it down is not assured and the path forward is uncertain”.

More confidence that inflation is under control will be needed before policymakers move to cut due to recent inflation figures.

Gaining that confidence will take “longer than previously expected”, he added.

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In addition to the typical statement from the Fed in recent months it highlighted this concern: “In recent months, there has been a lack of further progress toward the Committee’s 2% objective.”

It signals that interest rates will remain higher for longer but another hike was said to be “unlikely” by Mr Powell.

“The committee does not expect it will be appropriate to reduce the target range [of interest rates] until it has gained greater confidence that inflation is moving sustainably toward 2%,” the Fed said.

The Fed chair would not be drawn on if, and possibly when, rates would be cut this year. “There are paths to cutting, there are paths to not cutting”, he told reporters.

Central banks in the UK, US, and EU are all aiming to bring inflation down to 2%.

The Bank of England faces a similar decision next week when it will announce its own interest rate decision.

Markets had been expecting a cut in May, but are now not expecting one until August, according to data from Refinitv.

Unlike the UK, the US interest rate is a range rather than a single percentage – the Fed does not set a specific figure. Instead, the numbers are a target rate to guide lenders.

Untreated sewage was released into designated shellfish waters for 192,000 hours last year, new research has found.

The dirty water pouring into English seas was a 20% jump from 159,000 hours in 2022, according to the analysis of Environment Agency data by the Liberal Democrats, shared with Sky News.

The hours of sewage dumping were spread across 23,000 separate incidents – a slight fall from the previous year, but still an average of 64 times a day.

Some fishing waters in Cornwall were forced to close last year after high levels of e.coli were found in oysters and mussels, and norovirus can also be transported via human waste.

While the fishing industry can usually clean its catch before it reaches the plate, it has branded the situation a “stitch-up” because it foots the bill for the process.

Liberal Democrat environment spokesperson Tim Farron MP said: “This environmental scandal is putting wildlife at risk of unimaginable levels of pollution.

“The food we eat, and the British fisheries industry, must be protected from raw sewage.”

The Lib Dems are calling for an investigation into shellfish water quality – which should be protected from deterioration under the Water Framework Directive – and a government clampdown on polluting companies.

“It is getting worse on their watch and there will be real concerns for the fishing industry if this trend continues,” added Mr Farron, whose party is targeting many rural seats in the upcoming general election.

The worst offender was South West Water, responsible for 13,000 sewage discharges, totalling 98,000 hours, followed by Southern Water, which released sewage 7,000 times for 73,000 hours.

Southern Water pointed to the fact 2023 fell in the wettest 18-month period on record, while South West Water said it has a high proportion of shellfish waters across its vast West Country coastline.

Just 9% of shellfish waters in England reach the top “class A” status – clean enough that shellfish harvested from them can be sold without being purified first.

Anything caught from lower quality waters must be cleaned first in depuration tanks, where the molluscs purge themselves with sterile water, or cannot be sold at all.

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Fishing industry on a ‘knife edge’

Martin Laity, of Sailors Creek Shellfish, has been catching native oysters from the waters of Cornwall for 34 years.

He tracks alerts on the latest sewage discharges, so he can avoid fishing in those waters, and sometimes soaks the oysters in purification tanks for days longer than mandated just to be safe.

He calls the situation a “stitch-up” because it pushes up producers’ electricity and labour costs, and reduces the value of their catch, for which they receive no compensation.

Joe Redfern from the Shellfish Association Of Great Britain said producers “live on a knife edge”.

“Just one bad result can shut down their business overnight, leading to huge impacts to their business. It is a desperate situation and one that seems to be getting worse, with some businesses shutting for good,” he said.

It wants compensation for producers from the fines the government imposed on water companies for excessive sewage releases.

A spokesperson for industry body Water UK said: “Water companies understand and sympathise with the issues these businesses and coastal communities are facing, which is why we are proposing to spend £11bn to reduce spills as quickly as possible, halving spills into shellfish water by 2030.”

An environment department (Defra) spokesperson said: “We’re already taking action to clean up shellfish sites by driving the water industry to deliver the largest infrastructure programme in history – £60bn over 25 years – to cut spills by hundreds of thousands each year.

“Shellfish sites will be prioritised alongside bathing waters and sites of ecological importance.”

Defra is also increasing inspections and regulator funding, and considering banning some water company bonuses, they added.

South West Water said its plans will ensure all shellfish sites in its area meet the government’s target of less than 10 spills per year by 2030, and Southern Water said shellfish can also be infected by farming, run off from roads, boats, marine life and pesticides.