News in Brief: PetroChina, London lorry ban, IBM, OECD, ICAEW

News in Breif

PetroChina reports 70% drop in profits

China's biggest state-owned oil and gas producer, PetroChina, has reported a near 70% fall in net profits for 2015, in line with earlier guidance.

Like many other major oil companies, PetroChina's profits have been hit by the fall in oil prices over the past year, reported the BBC.

Net profits were £3.85bn (35.51bn yuan; $5.46bn) in 2015, down from £11.63bn (107.17bn yuan; $16.49bn) the year before the company said.

PetroChina is one of the largest oil firms in the world; based in Beijing, it is the listed arm of state-owned China National Petroleum Corporation (CNPC).

Earlier this year, it warned it would report about a 70% fall in net profits.

"In 2015, the global economic recovery slowed down, the downward pressure on China's economy continuously intensified, the overall supply in the oil and gas market was sufficient and the international oil prices kept dropping at a low level," the company said.

‘No plan, no lorry ban’

London Chamber of Commerce and Industry (LCCI) has said the future mayor should not rush towards a populist lorry ban in London without having thought through a credible plan to minimise economic impacts.

The call came as LCCI published findings of a ComRes survey on roads usage, which found 68% of businesses polled were supportive of pedestrianizing Oxford Street. Additionally, 67% of respondents want to see more relaxed night-time delivery rules in zone one.

Colin Stanbridge, chief executive of LCCI, said: “With increasing focus on quality of life issues in mayoral debates, these results show that businesses are keen to explore different options to achieve a sensible balance between public and commercial needs.”

Stanbridge added: “Zone one is a highly successful commercial area but for that to continue, policymakers must take care not to produce unintended consequences by taking quick, populist decisions. Those calling for a morning lorry ban must spell out how shops will be stocked in time for 9am openings or how builders secure supplies to construct the offices and homes central London needs.”

Tech giant to slash European workforce

Just a month after technology giant IBM announced the culling of hundreds of UK staffers, a top union official has warned that more sackings in Europe are set to take place.

IBM first revealed its "workforce rebalancing" for European employees in late January 2016, which affected around 400 staff from IBMs Global Technology Services, Global Business Services and UK Labs.

Now, according to the European Works Council (EWC), a second wave of harsh cuts is on the horizon, reported the International Business Times.

"The total foreseen headcount impact of this second reduction is almost 50% higher than the first round of job cuts," said Marc Born, secretary of the EWC. "The combined impact of both restructuring actions varies by country, but primarily Western-European countries are confronted with reductions which sometimes exceed 10% to 15% of current staff."

The EWC – which represents staff from large European firms – said it requested, but did not receive, any insight into the current financial situation of IBM, or 'Big Blue', as it is also referred to.

The union explained it has been presented with varying figures over the past few weeks and criticised IBM for a lack of "coherence and consistency".

According to Born, the latest round of sackings is taking a stronger focus on "involuntary reductions" with a "massive restructuring" of the European workforce.

OECD has released standardised e-format for exchange on BEPS

In a continued effort to boost transparency in international tax matters, the OECD has released its standardised electronic format for the exchange of Country-by-Country (CbC) Reports between jurisdictions.

The CbC XML Schema is part of the OECD’s work to ensure the efficient implementation of the BEPS measures, endorsed by G20 Leaders as part of the final BEPS package in November 2015.

The OECD/G20 BEPS Project sets out 15 key actions to reform the international tax framework and ensure that profits are reported where economic activities are carried out and value created.

The BEPS Project delivers solutions for governments to close the gaps in existing international rules that allow corporate profits to "disappear" or be artificially shifted to low or no tax environments, where companies have little or no economic activity.

ICAEW: Long-term economic plan requires backing from a modern finance ministry

The Institute of Chartered Accountants in England and Wales (ICAEW) director for public sector policy has commented on the ‘Public Sector Finances’ for March 2016, which was published on Tuesday (22 March 2016) by the Office for National Statistics (ONS).

Director Ross Campbell said: “While progress has been made to reduce public sector borrowing, public debt has increased and is precariously high. In the wake of a Budget announcement that revealed an increase in borrowing figures by £16bn with backtracks on savings leaving a fiscal hole in the Budget, sound management of the public finances is essential. Against a total of £756bn spent on public services, infrastructure and financial obligations by the close of 2016, achieving a £10bn surplus by 2020 can only be achieved with a government operating as a modern finance ministry.”

He added: “The fact that this target remains challenging highlights the need for robust systems to help the government shape its vision for long-term sustainable finances.

“The chancellor warned that, although the UK economy is strong, storm clouds are gathering again. It is therefore imperative that Whitehall devises a comprehensive strategy, based on accurate reporting and projections, to weather any looming storm.”