In a recent interview, Business Minister Lord Mandelson gave the first veiled indication of concern over the increasing number of Britain’s major businesses under foreign control. Mandelson pointed out that while the UK remained committed to open markets for trade and investment entailing that companies should remain open to foreign takeovers, whilst adding that the country should be "mindful" of the implications of foreign ownership

Mandelson’s comments appeared to signal a shift in the government’s open approach to takeovers by overseas firms and come amid a rising tide of protectionism around the world. In response to Mandelson’s comments, union leaders accused Lord Mandelson of "closing the stable door after the horse had bolted".

In his speech, Mandelson forecast that, foreign ownership could "disadvantage" the location of UK manufacturing plants over the next 20 years. His comments emphasised a growing concern as the government seeks to rebalance the economy and lessen the reliance on financial services.

Mandelson’s comments echoed those from City minister Paul Myners, who also has publicly expressed fears that too many British companies were falling into foreign hands because their shares are owned by international funds, and little concern was felt for their domestic heritage.

Britain has been a leading proponent of open markets and countless household names have been taken over by foreign companies. These include BAA, BOC, Marconi, Abbey National, Alliance & Leicester and British Energy.

Mandelson’s comments are bound to reverberate around the Vauxhall plants, fearing for their future after the car maker was bought by Canadian car parts firm Magna as well as at Cadburys where the American giant Kraft has attempted a hostile takeover.

When asked to comment on his speech Mandelson hastened to explain that while globalisation has served the UK well in the past and will do so in the future, there are issues around corporate institutional ownership and responsibility ". A major corporate buy-out by private equity can reshape a community or an industry, and there will always be a legitimate demand for transparency and accountability when that happens." He summed up.

financial

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Tags: Abbey National, Alliance & Leicester, BAA, BOC, British Economy, British Energy, Cadburys, Credit Crunch, Economics, Economy, Financial News, Financial Services, Kraft, Lord Mandelson, Magna, Marconi, Paul Myners, Recession, UK Banks, UK companies, UK Economy, UK government, UK manufacturing, UK Recession, Vauxhall

Chairman of the Financial Services Authority (FSA) Lord Turner revealed during a recent interview that in order to prevent excessive bonus payments he consider imposing a tax on banks.

The FSA chairman also stated that the financial services sector had "grown beyond a socially reasonable size". Lord Turner did hasten to add however that it was not the role of the FSA to set out any new government policy and that taxation was a matter for the Treasury.

In the past, the FSA have been the subject of criticism regarding their regulations on bonuses. Lord Turner is apparently concerned about the return to “business as usual” syndrome in the banking sector, suggesting that new taxes may be necessary to curb excessive profits and pay in the financial sector.

Meanwhile, newly recruited bankers at the Royal Bank of Scotland are liable to be feeling the pinch when pension time comes around. They are set to become the guinea pigs of a pension’s cutbacks scheme proposed by the U.K. bank. The scheme will be based on a lower-bonus, higher-base-salary recruitment environment in the City of London.

According to a recent poll, UK business leaders are more upbeat about the prospects of economic recovery than at any time since the recession began,

the survey of leading businessmen found that 38% see signs of recovery in their sector, up from 33% last month and the highest figure since the "green shoots" index was launched.

The bad news for hard pressed PM Gordon Brown was that the survey found only 18% of business leaders are confident in his ability, while 19% were impressed by Chancellor Alistair Darling’s efforts to date. Tory leader David Cameron got the thumbs up from 53% of the participants with shadow chancellor George Osborne polling 41%.

A group of distressed debt investors, which bought debt claims against the Yorkshire power station, have exercised an option to take control of one of Britain’s biggest coal-fired plants, at Eggborough, one of EDF Energy’s power stations which could eventually be sold on for up to £1 billion.

Japanese computer maker Fujitsu Ltd. said Wednesday it plans to axe 1,200 jobs in its British IT services unit because of lower than expected revenues.

Fujitsu, who employs around 12,500 workers in the UK, explained that the cuts were necessary to ensure the company remained competitive during the current downturn.

Following the 2005 restructuring of British Energy, creditors have the right to take ownership of the plant in March 2010 with the option only being exercisable till the end of this month.

Shares in the world’s largest advertising company WPP Plc fell 1.4 percent, to 512.5 pence after the company reported a 48 percent drop in first-half profit to £108.4 million blaming the pounds rise against the dollar and increased finance costs.

The FTSE 100 moved lower on Thursday following a weaker opening on Wall Street, falling 21.23 points to finish the day on 4,869.35, while the FTSE 250 continued to reverse, dropping a further 81.88 points to close on 8,701.33

As short-term UK government bond yields fell to record lows, Sterling dropped to a six-week low against the dollar and a 10-week low against the Euro.

• Pound/US dollar 1.6239
• Pound/Euro 1.1351
• Pound/Japanese Yen 151.8974
• Pound/Swiss Franc 1.7173

On Wall Street, markets continued to drift, with the Dow Jones Industrial Average closing up 23.5 points while the NASDAQ lost 3.55 points to close on 2,020.88.

Angela Merkel, German chancellor, has thrown her considerable (political) weight behind calls from French president Nicolas Sarkozy for tougher international curbs on bankers’ bonuses, in anticipation of next month’s G20 summit to be held in Pittsburgh, USA.

Ms Merkel, who said large bonuses encouraged excessive risk-taking, will meet Mr. Sarkozy to discuss the French plans, which Mr. Sarkozy presented to bankers on Tuesday. Plans that include deferring at least half of a year’s bonus and paying it over the three subsequent years, subject to performance criteria

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Tags: Alistair Darling, Banking, British Economy, British Energy, Currency, David Cameron, Economy, Employment, Financial News, Financial Services Authority, FSA, FTSE, Fujitsu, George Osborne, Gordon Brown, Lord Turner, Money Markets, NASDAQ, Nicolas Sarkozy, Recession, Royal Bank of Scotland, Stock Markets, UK Banks, UK business, UK Economy, UK Recession, Wall Street