27th January 2020

Written by Javier Maquieira, Associate

Edited by Sabina Kadić-Mackenzie, Associate Partner

Good morning, On this day in 1945, Red Army soldiers poured into Auschwitz, the Holocaust’s largest extermination and concentration camp, and liberated the 7,000 prisoners that remained there. Seventy-five years on, events commemorating liberation are the subject of a dangerous narrative battle that is testing the European Union’s resilience against modern threats to democracy. In December 2019, Russia’s Vladimir Putin told leaders of former Soviet republics that Poland and its western allies had been responsible for the outbreak of the Second World War in Europe. According to him, Poland had no right to pose as a victim after the war, since the Polish had previously formed an anti-Soviet alliance with Germany that left the USSR with no choice but to sign a non-aggression pact with Adolf Hitler. In line with Putin’s ongoing plans to become the “father of the nation” as he races to amend Russia’s constitution, his historical revisionism seeks not only to exploit current divisions between Poland and the EU, but also to reinforce the image of the USSR as the legitimate winner of the war against Hitler at home. In a furious response, Poland’s prime minister, Mateusz Moriawiecki, has accused Russia of trying to “rewrite history”, saying that the USSR had been “a facilitator of Nazi Germany” rather than a liberator. In addition to the Russian-Polish row over each other’s degree of complicity with the Nazis, there is the challenge of a weakened Franco-German relationship, as seen in Emmanuel Macron and Angela Merkel’s war of words. Their disagreement on what the future of the EU should look like risks leaving the bloc without a clear and cohesive purpose as it faces growing populism and geopolitical multipolarity. But as the world remembers the millions of people murdered by Nazi Germany and other totalitarian regimes on this Holocaust Memorial Day, debunking false, divisive narratives aimed at fuelling hatred and oppression will continue to be our most powerful act of peace and truth.

News

NBA legend Kobe Bryant has died in a helicopter crash at the age of 41. The US basketball player was on board with eight other people who were also killed, including Bryant’s 13-year-old daughter, Gianna. Chinese officials have told reporters that the ability of the coronavirus to spread before symptoms show is strengthening. The Wuhan virus, which has left 80 deaths and 2,700 people infected so far, is now thought to be able to spread even when a person may not know they have the infection, making it harder to identify and isolate. China has already imposed significant travel restrictions and banned the sale of all wildlife in the country since Sunday. Ireland’s prime minister, Leo Varadkar, has warned the UK that the EU will have the upper hand in the trade agreement negotiations and that no “piecemeal” deal will be struck with the bloc. Varadkar has questioned Boris Johnson’s timetable to secure a “zero tariff, zero quota” trade deal with Brussels, hinting that there might have to be an extension to the next phase of the Brexit process.

Business and economy

Aircraft manufacturer Boeing has successfully completed the test flight for one of the world’s biggest passenger planes after three attempts to get it off the ground due to high winds. The 777X model, which is 77m long and can seat more than 400 passengers, took off from Seattle before landing at the Boeing Field four hours later. Cabinet minister Stephen Barclay has told the BBC that the HS2 high-speed rail line is key for “levelling up” the UK’s transport network and that he has a “gut feeling” that the project will get the go-ahead. Barclay’s comments come amid criticism over the increasing cost of the HS2, which could reach £106bn. Prime minister Boris Johnson is set to approve a limited role for Huawei in the UK’s 5G network tomorrow. Ministers are considering the imposition of a new market share restriction on the Chinese telecoms giant. The move comes after the US prompted Johnson to ban Huawei from the entire network, with Washington arguing that the firm poses a security risk and threatens UK-US intelligence sharing. (£)

Columns of note

Andrew Hill argues in the Financial Times that posterity will be a harsh judge of today’s corporate leaders. He emphasises that any legacy is only as secure as the chief executive’s replacement, with business leaders now having less time to prepare succession as median time in office falls. (£) Writing in The Guardian, Yale University professor Jacob Stanley wonders what the meaning of Auschwitz is 75 years after its liberation. According to him, the deadliest camp in the Third Reich was a creation of humans convinced of a political ideology spread and enabled by humans – a situation that could repeat itself.

Markets

The week ahead

On the week that the UK is finally due to leave the EU, concerns over the spread of the coronavirus are shaking global equity markets. Stocks are expected to be hit even harder as the death toll of the virus continues to grow and the contagion extends across and beyond Asia. As US president Donald Trump’s impeachment trials rolls on, close to 140 countries will try to agree a framework to overhaul international tax rules considered outdated by the rise of big tech at an OECD meeting in Paris. Mark Carney’s last meeting as Bank of England governor on Thursday is projected to be among the most compelling of his time in that role, as investors remain equally divided about the possibility of an interest rate cut. In equity news, 145 firms in the S&P 500 will report earnings results this week, with updates expected from tech giants Apple and Microsoft, whose market capitalisations have exceeded $1tn. US and Eurozone growth figures are also scheduled. On Friday 31 January at 11pm, the UK will be formally out of the EU’s institutions while the situation of businesses and individuals living and working in the UK will stay the same until the end of December 2020.

What's happening today

Finals Global Inva Sthree Interims Itm Power Trading Announcements Petra Diamonds

Int. Economic Announcements (09:00) IFO Current Assessment (GER) (09:00) IFO Business Climate (GER) (09:00) IFO Expectations (GER) (10:00) Economic Sentiment Indicator (EU) (10:00) Services Confidence (EU) (13:30) Personal Consumption Expenditures (US) (15:00) New Homes Sales (US)

Did you know?

So far in the 21st century, LEGO has proven to be a better investment than gold.

Parliamentary highlights

TODAY House of Commons Oral questions Work and Pensions (including Topical Questions) Legislation NHS Funding Bill: Second Reading Money Resolution NHS Funding Bill - Jesse Norman Adjournment Claim of right for Scotland - Patricia Gibson House of Lords Oral questions Participation in the Horizon 2020 programme beyond the Brexit transition period - Lord Bassam of Brighton Availability of children's emergency beds in the NHS in England - Baroness Donaghy Improving support for children excluded from mainstream schools - Baroness Meacher Introduction of the Agriculture Bill - The Lord Bishop of St Albans Legislation Air Traffic Management and Unmanned Aircraft Bill - Second reading - Baroness Vere of Norbiton Short debate Current health of the reserve forces - Lord De Mauley Scottish Parliament No business scheduled. TOMORROW House of Commons Oral questions Health and Social Care (including Topical Questions) Legislation Direct Payments to Farmers (Legislative Continuity) Bill: Committee and Remaining Stages Motions To approve a Statutory Instrument relating to the Draft Release of Prisoners (Alteration of Relevant Proportion of Sentence) Order 2019 To approve a Statutory Instrument relating to the Draft Criminal Justice and Courts Act 2015 (Consequential Amendment) Regulations 2019 Adjournment Case of Sara Al Amoudi - Sir Paul Beresford Section 136 of the Mental Health Act 1983 - Sir Paul Beresford House of Lords Oral questions NHS compliance with the General Data Protection Regulation - Lord Clement-Jones Children looked after by local authorities and those who are adopted - The Lord Bishop of Gloucester Increased participation of SMEs in the Apprenticeship Levy - Lord Young of Norwood Green Assessment of the CBI’s quarterly business confidence survey - Lord Borwick Legislation Pension Schemes Bill - Second reading - Baroness Stedman-Scott Debate Formulating the government's pledge at the Tokyo Nutrition for Growth 2020 summit, and what the government are doing to build commitments from other countries - Lord Collins of Highbury Scottish Parliament Ministerial Statement Queen Elizabeth University Hospital Oversight Board Update Scottish Government Debate Holocaust Memorial Day 2020 – 75th Anniversary Committee Announcements Members' Business — S5M-20306 Sandra White: Alasdair Gray, a Creative Force