Twin scandals hit PwC’s Asia earnings | Invesloan.com

Today’s agenda: Poland’s historic grievances; Israel bans UNRWA; Spain’s economy shines; a Nigerian tech ‘unicorn’; and Europe’s car crisis

Good morning. We begin with the impact of scandals on PwC’s bottom line in Asia.

What happened? PwC’s business in the region shrank over the past year after twin scandals caused the Big Four accounting firm to lose clients in China and forced it to sell its government consulting arm in Australia.

How bad was the hit? The firm reported a 12.7 per cent decline in Asia-Pacific profits for the year ended June 30, reflecting its loss of market share in the region and offsetting growth in the Middle East and Europe.

Revenue in Asia-Pacific, the smallest of the firm’s regions, fell from $10bn in the 2023 fiscal year to $9.3bn, down 5.6 per cent in local currencies.

The two scandals compounded an ongoing slowdown in the consulting market that has also crimped growth at rivals Deloitte and EY in their most recent fiscal years. Read the full report.

Here’s what else I’m keeping tabs on today:

• High-level meetings: European Commission president Ursula von der Leyen has a working lunch with Nato secretary-general Mark Rutte. Ukrainian President Volodymyr Zelenskyy joins Nordic leaders at the Nordic Council meeting in Reykjavík.

• UK: The funeral of Alex Salmond is held. The former Scottish first minister died of a heart attack while in North Macedonia this month.

• Results: Adidas, Alphabet, BP, HSBC, Lufthansa, McDonald’s, Mondelez, Novartis, PayPal, Pfizer, Reddit, Santander, Visa and YouGov are among the companies reporting. Full list in the Week Ahead newsletter.

Hear directly from the presidents of Kenya and Somalia and other leaders at the FT’s Africa Summit starting today, where they will discuss how to drive sustainable growth across the continent. Register here.

Five more top stories

1. Ukraine should exhume and rebury ethnic Poles massacred on its territory, and Germany should invest in military co-operation and compensate Polish victims of the Nazis, Poland’s foreign minister has said, adding that historic grievances cannot be brushed aside even during Russia’s war against Ukraine. Read the full interview with Radosław Sikorski.

2. Spain is set to surpass the US to become the world’s fastest-growing major advanced economy this year, expanding at more than three times the pace of the Eurozone as a whole. Economists surveyed in a poll expect GDP data this week to show the country’s economy is on course to expand by 2.7 per cent this year. Here’s what’s driving growth.

3. Global investment banks expect UK debt sales this year to rise close to £300bn, the second-highest on record, as the government heads for a showdown with bond investors at tomorrow’s Budget. Gilts are on track for their worst month since April as unease over a proposed loosening of the country’s borrowing rules adds fuel to a recent sell-off.

• Healthcare boost: The NHS in England will receive £1.5bn next year to deliver 2mn extra appointments as part of a multibillion-pound annual package to strengthen the health service.

• Private equity: Executives, lobbyists and advisers are seeking a deal with UK chancellor Rachel Reeves on carried interest.

4. Israel’s parliament approved two pieces of legislation yesterday that ban the UN agency for Palestinian refugees from operating within Israeli territory and cut diplomatic ties with the organisation. The measures, which threaten the agency’s ability to provide food, medicine and shelter to nearly 2mn Gazans displaced by war, have raised concerns among Israel’s closest allies.

5. Exclusive: The Nigeria-based fintech Moniepoint has gained “unicorn” status after raising $110mn from investors including Google, a rare bright spot in the funding market for African tech companies. One of the continent’s fastest-growing groups, Moniepoint provides digital financial services to a market where many still lack access to bank accounts. Read more about the start-up’s expansion plans.

• More from Nigeria: The country’s president has summoned oil magnate Aliko Dangote to an emergency meeting with industry officials to discuss supplying the industrialist’s new $20bn refinery with crude.

Try your hand in running the UK economy with the FT’s Budget game.

The Big Read

Europe’s car industry is confronting a perfect storm. Demand is falling at home and overseas, while companies are navigating a risky and expensive transition from combustion engines to electric propulsion. Exacerbating these problems is China, which is exporting high-quality, lower-cost electric vehicles to Europe in greater numbers. Between protectionism and government incentives, there are no easy solutions.

We’re also reading . . . 

• US foreign policy: America needs a new approach that is rooted in the breaking up of concentrated global economic power, writes Chris Murphy, the junior senator for Connecticut.

• US elections: With just one week left, Kamala Harris and Donald Trump appear deadlocked. Here’s what to know about the presidential race in its final stretch.

• Snap’s struggles: Founder Evan Spiegel is battling to revive the social media company’s fortunes as ambitions are hit by the growing strength of arch-rival Meta.

Chart of the day

The publisher of works by JK Rowling and Sarah J Maas, Bloomsbury has remained steadfastly independent through the years. Its consumer division, driven by sales of two of the most successful authors of modern times, has risen, but the company is also diversifying into reference titles, having recently acquired the academic list of US publisher Rowman & Littlefield for $83mn in a hunt for stable revenues.

Take a break from the news

Jean Tinguely is viewed as a pioneer of kinetic art. With the centenary of the latter-day Dadaist’s birth just months away, the Pirelli HangarBicocca museum in Milan has kicked off celebrations early with a retrospective that highlights the radical nature of his work and his connections with the Italian city.