Charlotte Street Partners



An Olympic déjà vu

Written by Javier Maquieira, senior associate 
Edited by Iain Gibson, associate partner
26 May 2021

Good morning,

It seems like only yesterday that the International Olympic Committee (IOC) delayed the start of the 2020 Summer Olympics in Tokyo by 12 months.
That was in March last year, when most of us saw July 2021 far in the future. One month later, Japan’s former prime minister, Shinzo Abe, boldly stated that the Games “must be held in a way that shows the world has won its battle against the coronavirus pandemic”.
Taking a look at what actually happened yesterday, Tokyo reported 542 new cases of Covid-19. The Japanese capital, which is still under a state of emergency, also confirmed on Monday its first cluster of infections with the so-called Indian variant, while hospitals in Osaka, the country’s second city, are running out of beds and ventilators.
Amid Japan’s fourth coronavirus wave, the Japanese government is desperately trying to accelerate its vaccination rollout to curb infections ahead of 23 July, when the Olympics are due to begin with 11,000 athletes from 200 nations and territories. Prime minister Yoshihide Suga has even made the ambitious pledge to finish inoculating the country’s 36 million elderly people by that date.
Meanwhile, the IOC has insisted that “sacrifices” – including banning international, and possibly local, fans from attending the Games – must be made to ensure the event can proceed regardless of the coronavirus situation.
But the Japanese public isn’t nearly as thrilled as Suga’s government or the IOC about the Olympics going ahead. According to a recent poll, more than 80% want the Tokyo Olympics to be either cancelled or postponed again. Even some of the country’s top businessmen, including the chief executives of Rakuten Group and SoftBank, are calling for a cancellation.
If that wasn’t enough pressure on Japanese officials and the IOC, the US state department has warned its citizens against travel to Japan. Japanese ministers have tried to play down the situation, saying “there is absolutely no change in the United States’ support for Japan’s decision to hold the Olympics, we believe”.
Yet while other countries face the challenges posed by a new variant or insufficient public health infrastructure, the additional burden of hosting the most extraordinary of Olympic Games puts Japan in a delicate position.
Cancelling the Olympics might well be “off the table” for the IOC and the Japanese government, but whether these Games will prove Abe’s vision of a world winning the battle against the pandemic remains to be seen.


The UK government has clarified its advice for the eight areas in England worst affected by the Indian coronavirus variant, after published guidance asked people not to meet indoors or travel unnecessarily. The updated advice asks to minimise, rather than to avoid, travel, following 24 hours of confusion as to whether Downing Street was imposing local restrictions.
Boris Johnson’s former chief of staff, Dominic Cummings, is expected to tell MPs in the Commons technology and health committees that the prime minister justified delaying lockdown in the autumn by claiming “Covid is only killing 80-year-olds”. The alleged comments would follow other allegations that Johnson said he would rather “let the bodies pile high” than impose another lockdown amid Britain’s second wave that took the death toll to over 150,000.
The families of Roman Protasevich and his Russian girlfriend, Sofia Sapega, who remain detained after their plane was diverted to Belarus, have called on the international community to free them. The calls come as President Biden mulls US sanctions against Belarus and after a video of Sapega reading a memorised text, apparently under duress, was released. Belarus’s president, Alexander Lukashenko, is due to address the Belarusian parliament today in his first appearance since Sunday’s incident.

Business and economy

The Irish finance minister has told Sky News that the country has no plans to increase its corporate tax rate, following President Joe Biden’s call for a global minimum rate. Paschal Donohoe said he had “significant reservations” over the US president’s scheme, and predicted that Ireland will maintain its 12.5% corporate tax rate – one of the lowest in the developed world – for many years to come.
According to data from the Office for National Statistics, China has overtaken Germany as the UK’s biggest import market. Goods imported from the Asian country increased by 66% since the start of 2018 to £16.9bn in the first quarter of 2021 while imports from Germany fell by a quarter over the same period, to £12.5bn. Although the European Union as a whole remains the largest trading partner for the UK, trade with the bloc has fallen by 23% from 2018 as a result of disruption to exports from Britain caused by Brexit and Covid-19.
The chancellor of the exchequer, Rishi Sunak, plans to propose new powers to block companies from listing on the London Stock Exchange on national security grounds. Under the proposals to be unveiled, a listing could be stopped if a company was found to be giving a foreign state access to state or commercial secrets or was owned by people who might harm UK interests. The Treasury is due to launch a consultation to inform the design of this new power in the coming months. (£)

Columns of note

Neil McInroy argues in The Guardian that solving the UK’s regional inequalities will take outstanding constitutional reform, rather than more top-down tinkering from the government. He reflects on more than 80 years of promises to “level up” Britain that have failed to break up the power of Whitehall, concluding that the model needs to ensure investment through public investment banks or community wealth building and isn’t disproportionately concentrated in particular areas.
Writing in The Times, Katherine Griffiths opines that financial entities should be held accountable for their pollution of the planet caused by lending and investment in various sectors such as oil, gas, or coal. Although Griffiths welcomes greater disclosure of lenders’ climate impact and the Bank of England’s plans to announce the details of its climate stress tests on banks, she echoes those calling on UK ministers to do something more than rely on voluntary commitments in finance. (£)

Cartoon source: The Times


What happened yesterday?

London stocks finished lower on Tuesday as investors mulled fresh data on the UK’s trade with the European Union. The FTSE 100 ended the session down 0.31% at 7,029.79, while sterling was weaker both against the dollar by 0.18% at $1.41 and versus the euro by 0.31% at €1.15.
Across the Atlantic, US stocks fluctuated between small gains and losses following data showing declining consumer confidence and higher home prices. The blue-chip S&P 500 closed down 0.2% for the day, while the tech-heavy Nasdaq Composite traded flat for much of the afternoon, closing marginally lower.
In company news:

Aveva Group closed 1.62% higher as the industrial software company said the outlook remained in line with expectations after trading had normalised from the impact of Covid-19 in most of its markets.
Greencore was down 15.69% after the convenience food group said it swung to a loss in the six months ending March 2021, as a result of Covid-19 restrictions.
Avon Rubber lost 10.71%, despite the manufacturing company posting a jump in interim profit and revenue.

What’s happening today?

Asa Int
De La Rue
Marks & Spencer
Mediclinic International

Anglo Pacific
China Yangtze S
Coca-cola Euro.
Deltic Energy
En+ Group S
Eve Sleep
HICL Infrastructure
Intertek Group
Judges Scientfc
Keywords Studio
M&g Plc
Sherborne Inv B

Int. economic announcements
(12:00) MBA Mortgage Applications (US)
(15:30) Crude Oil Inventories (US)

Source: Financial Times

did you know

The inventor of Scrabble assigned values to letters by painstakingly counting their frequencies in the Saturday Evening Post and the New York Times. (source: @qikipedia)

Parliamentary highlights

House of Commons

Oral questions
Women and Equalities (including Topical Questions)
Prime Minister’s Question Time
Environment Bill (Day 2): Remaining Stages
Decision making on Walsall’s transit site

House of Lords 

Oral questions
Number of e-scooters being used illegally in London
Legislation to reduce Overseas Development Assistance funding
Registering rogue landlords
Orders and regulations
Global Anti-Corruption Sanctions Regulations 2021
Dormant Assets Bill [HL] – second reading

Scottish parliament 

Parliamentary Bureau Motions
Topical Questions (if selected)
First Minister’s Statement: Scottish Government Priorities
Committee Announcements
Business Motions

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