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Farmers fight to save stunted crops in record UK heat

Edward Lindley’s main potato crop of the year is withering. The leaves falling off the plants on his 1,500-acre east Yorkshire farm are just one sign of a crop stunted by the UK’s record-breaking heat; he expects a drop in his yields of at least a quarter.

“When a potato crop sits in this kind of heat it just shuts down. It will not grow,” he says. Referring to a commonly used weedkiller, he adds: “You walk in and think, it looks like someone’s put Roundup on it.”

Yet Lindley considers himself one of the lucky ones. While his potatoes are suffering, he is still allowed to secure water for the crop through a borehole on his farm in northern England. He estimates most other potato farmers could suffer a drop in yield of at least 40 per cent.

Many of his neighbours and other vegetable growers around the country have hit the limits of the water the Environment Agency will allow them to use in the UK’s driest summer for half a century, pushing them from a difficult situation into crisis. On Friday, the agency declared a drought across south, central and eastern England.

The heat and water scarcity have compounded the struggles of a sector already grappling with a range of post-Brexit issues and dramatic cost rises. The Andersons Centre, a farming consultancy, estimated that agricultural input costs rose 23.5 per cent year-on-year in July.

“Barring a plague of locusts, I don’t think we could have had a worse five years,” Lindley said.

Farmers are accustomed to operating at the mercy of the weather. But recent extremes have strained their business models and offered an unpleasant taste of the future as food production is increasingly affected by climate change, said Jon Stanley, a mixed farmer in Leicestershire and author of Farm to Fork: The Challenge of Sustainable Farming in 21st century Britain.

“In the UK we rely on our temperate, maritime climate for the way that we produce our food . . . but since 2017 we have had extremes every single year which have had a huge impact on my farm’s ability to produce food,” he said.

The east and south of England, including key growing areas such as Lincolnshire, have been especially hot and dry in 2022, and vegetable growers, who rely on irrigation, are facing some of the most acute problems.

Tom Bradshaw, vice-president of the National Farmers’ Union, said water shortages for growers were cutting into yields, in some cases stunting vegetables below the size that supermarkets will accept.

“One retailer turned down 60 acres of cauliflowers because they did not meet its specifications. The crop had to be ploughed in,” he said, adding that farmers were asking retailers to relax size requirements.

McCain, the UK’s largest buyer of potatoes, said the effects of climate change were “all too real” for its growers. Early crops this year performed well, but “many of the later crops are under severe stress — and the next few weeks will be critical”, said James Young, a vice-president at the multinational frozen food company.

Meanwhile, Jack Ward, chief executive of the British Growers Association, said crops being planted now, such as brassicas, are battling arid soils.

“We now have to contend with the fact that we are trying to put very small, young plants into parched soils. And that’s what we are relying on to eat in the winter. We are effectively putting them into dust,” he said.

Dairy and livestock farmers are also enduring hardship after the grass their animals graze dried up. “I was walking across our fields and it was crunching under my feet. It’s bone dry,” said Ruth Grice, a dairy farmer in Leicestershire.

Ruth Grice has seen milk yields drop by 7% as her cows react to the heat © Cameron Smith/FT

Grice is feeding her cattle silage intended for the winter, even as the weather stunts the crops that would normally help to build up the farm’s stock of winter feed.

Grice’s milk yields have dropped by about 7 per cent as her animals react to the heat, but the bigger concern is the risk of feed shortages later in the year, which could pit farmers against one another in buying feed at already high prices.

“There will be farmers out there when it comes to winter that will have to make more drastic decisions in terms of herd size, putting animals into the beef food chain instead of staying in dairy,” Grice said.

Arable crops may be harvested earlier this year, with lower drying costs, but also face lower yields, said Mark Tufnell, president of the Country Land and Business Association. One of the more affected crops is oilseed rape, which is badly needed to help with cooking oil shortages resulting from the Ukraine war.

The NFU has called for a more flexible approach to the rules that govern water that farmers can source under so-called abstraction licences, which enable them to take water from rivers, streams, drains and boreholes.

Jerry Knox, professor of agricultural water management at Cranfield University, said this would allow farmers to “take water during periods of high river flow for storage and use [it] later”, adding: “This will facilitate water sharing and reduce summer pressure on water supplies.”

For the longer term, farmers can now apply for grants to fund construction of on-farm reservoirs. They are also adopting a range of tactics to strengthen soils, enabling the earth to hold more water, said Stanley, such as switching from rye grass to mixed herbal leys with a deeper root structure.

The parched grass on Ruth Grice’s dairy farm in Leicestershire
The parched grass on Ruth Grice’s dairy farm in Leicestershire © Cameron Smith/FT

But on a much larger scale, farming groups want ministers to develop a national water strategy to ensure that surplus water can be stored in the wetter months and that the UK prepares at a national level for a water-scarce future.

The Environment Agency warned last month that some rivers could have 50 to 80 per cent less water in summer by 2050 with temperatures 7.4C higher.

Minette Batters, NFU president, told BBC Radio 4’s Today programme on Friday that managing water as a national resource was imperative, as it was abundant in some parts of the country and not in others. “We’ve got to be able to move water, we’ve got to be able to pay farmers to store water, and we’ve got to stop wasting millions of gallons of water into the North Sea.”

The government said it was receiving regular updates “about impacts on the farming sector”. It said it had offered some flexibility on water abstraction, providing £10mn for water management and given advice.

Stanley urged the government, which he said was distracted by the ongoing Conservative leadership race, to draw up a national water strategy as a priority. He said this would help ensure food security — a key concern among farmers worried that more production will move overseas in the wake of Brexit.

Against this backdrop, however, Stanley said climate change was a key determinant of farmers’ fortunes. “Leaving the EU was a huge shock to the industry, but climate change to this point really has [had] the biggest impact on farm profitability.”

Additional reporting by Camilla Hodgson

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Barcelona races to comply with Spain’s football league financial rules

FC Barcelona has raised a further €100mn by selling a stake in its audiovisual studio, as it races to comply with Spanish football league financial rules before it can register new players for the coming season.

The club said on Friday it had agreed to sell a 24.5 per cent holding in Barca Studios to Orpheus Media, taking the income it has generated from asset sales this summer above €700mn.

It sold a separate 24.5 per cent stake in the studio business to crypto platform Socios earlier this month, and took in about €530mn in exchange for 25 per cent of its La Liga broadcast rights in a deal with US investment group Sixth Street.

The asset sales are part of a sweeping overhaul of Barcelona’s finances under its president Joan Laporta. Last summer the club had more than €1.3bn of debt, according to Laporta, and it booked a loss of almost €500mn for the previous season. Players were forced to take pay cuts and defer wages, while Lionel Messi — the club’s biggest star — had to leave to comply with La Liga rules on salary limits.

Although income from the recent asset sales has helped repair the club’s balance sheet, much of the money has been committed to new players. Barcelona has already spent more than €150mn on signings this summer — more than any other club in Europe — with five new faces brought in so far.

Yet none of those players had been registered with La Liga yet due to its financial regulations. The league sets an annual budget for each club for its playing staff based on its income and costs, which can block teams from new signings until the books are balanced.

Barcelona and the league have been at odds over how to calculate the amount of revenue generated by the various asset sales. La Liga recently told the club it would need to raise further cash in order to register players, according to a person familiar with the details.

Friday’s deal should help pave the way for Barcelona to register some of its new players ahead of the first game of the season on Saturday evening. Aside from the five new signings, two players already at the club have signed new contracts and will also need to be registered again with La Liga.

Orpheus Media, which bought the stake in Barca Studios, is controlled by Jaume Roures, a Spanish media executive and co-founder of Mediapro.

Mediapro hit the headlines in 2020 when it abandoned its TV rights deal with the French football league, plunging Ligue 1 teams into financial chaos. The company missed payments during the first few months of the pandemic and sought court protection from creditors.

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Johnson admits UK’s cost of living support is not enough

UK prime minister Boris Johnson on Friday admitted that the government’s existing £37bn cost of living package may not be enough to support struggling households, as Liz Truss, the frontrunner to replace him, rejected calls for windfall taxes to limit the pain of rising energy bills.

Johnson, who will leave office next month, said in north Wales that he would not “pretend” the economic situation was easy for the public, adding that ministers were focused on ensuring that the Treasury had “fiscal firepower” to help households in autumn.

Asked if current support measures were enough, he said: “No, because what I’m saying what we’re doing in addition is trying to make sure that by October, by January, there is further support and what the government will be doing, whoever is the prime minister, is making sure there is extra cash to help people.”

Earlier this year, the UK announced a £37bn package of measures, including one-off payments of £650 to those on means-tested benefits; £400 to ease the cost of energy bills; and £300 to the estimated 8mn pensioner households in receipt of the winter fuel payment.

“I think it is very important for people to understand, most people have not yet received the help the government has already allocated,” Johnson added. “So over the course of the next couple of months you will see about 8mn households get another £326, you will see everybody in October get help with the energy support scheme.”

Downing Street has ruled out making any major fiscal interventions before September 5, when a new prime minister is announced, despite warnings from Martin Lewis, founder of the MoneySavingExpert website, and former prime minister Gordon Brown that urgent support is needed.

Energy consultancy Cornwall Insight has estimated that the energy price cap on customer bills could increase from its current rate of £1,971 a year to £4,427 by next April.

Chancellor Nadhim Zahawi on Friday said the government was “looking at all the options” to help people through the winter. “We’re making sure we’re doing the work so on September 5 the new prime minister can hit the ground running and get those things into place,” he told Sky News.

Johnson’s comments came after Truss on Thursday reiterated her opposition to imposing windfall taxes on oil companies, arguing that it amounted to “bashing business” and sent “the wrong message to international investors”.

The foreign secretary’s economic pledges include tax cuts worth about £30bn, the reversal of the national insurance rise and a temporary moratorium on the green energy levy.

“One thing I absolutely don’t support is a windfall tax,” she told Conservative party members during hustings in Cheltenham in the west of England. “I don’t think profit is a dirty word, and the fact it’s become a dirty word in our society is a massive problem,” Truss added.

In May, the UK introduced an energy profits levy on oil and gas companies, however, record profits reported by the sector have promoted renewed calls for further invention.

Shell, Europe’s largest oil company, reported adjusted earnings of $11.5bn in the second quarter of this year, while the operating profits at Centrica, UK’s biggest energy retailer, rose to £1.3bn between January to June.

Meanwhile, former chancellor Rishi Sunak has attacked his rivals plans, arguing that tax cuts would do little to help the most vulnerable in society.

“There are two groups of other people who will need more help: people on very low incomes and pensioners. Now, Liz Truss’ tax plans do virtually nothing for those people,” he said in an interview with Times Radio on Friday.

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Drought declared across large parts of England

A drought has been formally declared across large swaths of England, as the UK experiences its driest summer for 50 years, the Environment Agency said on Friday.

Drought status had been confirmed for eight of England’s 14 areas, spanning the south, east, south west and centre of the country, the Environment Agency said.

Although the declaration of a drought — the first since 2018 — does not automatically trigger new restrictions, it does require the Environment Agency and water companies to accelerate their actions to manage the effects of unusually low water levels.

The announcement, which followed a meeting of the National Drought Group, comprising government, the Environment Agency, water companies and groups such as the National Farmers’ Union, comes as the UK contends with its second heatwave in two months.

The latest spell of hot weather this week prompted the government to issue a public health warning, while a new record temperature of 40.3C was recorded last month in Lincolnshire.

The prolonged period of hot and dry weather had pushed river flows, soil moisture, groundwater and reservoir levels to much lower levels than normal, the government said. Demand for water had also recently increased in response to the very hot and dry conditions.

“We are currently experiencing a second heatwave after what was the driest July on record for parts of the country,” said water minister Steve Double on Friday.

“All water companies have reassured us that essential supplies are still safe, and we have made it clear it is their duty to maintain those supplies,” he added.

Five water companies across England and Wales have already announced temporary hosepipe bans this summer, which will affect more than 7.4mn people.

Hannah Cloke, professor of hydrology at the University of Reading, described the declaration of a drought as “overdue”.

“We need to plan longer term to cope with drought and water stress,” she said. “Some rain is forecast in the weeks ahead, but this is unlikely to be long-lasting or widespread enough to make a big difference to some exceptionally low levels in reservoirs and rivers.”

Ministers and water companies have urged the public to use water sparingly, while the Environment Agency said it was working with farmers to ensure they had the supplies they needed.

The government has also said it expects the industry to “act to reduce leakage and fix leaking pipes as quickly as possible”. Some “20 per cent of [the UK’s] mains water supply is lost to leakage” daily, according to the House of Commons environmental audit committee.

The London Fire Brigade on Thursday warned of “tinderbox dry” conditions, which it said had created an “exceptional fire risk across London”, as it urged people not to have barbecues. Supermarkets including Sainsbury’s and Tesco have temporarily halted sales of disposable barbecues in light of the fire risks.

England experienced its driest July this year since 1935, and since records began for the east and south east of the country. The government said some rivers were at the lowest levels ever recorded, while the dryness of soils was comparable to the end of the 1976 drought.

The Environment Agency has asked Yorkshire Water to halve the amount of water it takes from the Holme Styes reservoir in Yorkshire to 1mn litres a day, to prevent it from “running dry”. The company on Friday announced a hosepipe ban that will affect 5mn people.

As climate change accelerates, summers in the UK are expected to become dryer, while extreme weather events will become more frequent and intense.

The National Drought Group will meet again on August 23.

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Crypto libertarians find out sanctions apply to them too

This week, we got a reminder of what happens when the grand decentralised crypto worldview meets the US sanctions regime. Spoiler alert: the US sanctions regime wins.

The US Treasury’s target this week was Tornado Cash, a so-called crypto mixing service that allows users to break the traceability of their activity on the Ethereum blockchain.

Normally, transactions on a blockchain carry the equivalent of a cash serial number that lets the world track payments online. Using Tornado Cash, customers could deposit ether using one address, where the funds would be mixed into a single pool containing all users’ funds. Then it is drawn out using a different address, making the owner untraceable.

In the words of digital asset compliance firm TRM Labs, it was “the privacy tool of choice”. While it attracted users who wanted to use it for good, such as donating to a worthy cause in total privacy, naturally it also attracted those who had more nefarious intentions. The US alleged that Tornado Cash had been used to launder more than $7bn, including at least $500mn from state-backed North Korean hackers.

The US sees mixing services as money transmitters that must comply with money laundering rules. It’s the second time this year that the US has hit a crypto mixing service for helping North Korean hackers after it imposed sanctions against Blender.io in May.

Now, all property and interests belonging to Tornado Cash in the US are blocked. All transactions passing through Tornado Cash’s virtual desk are blocked too, if they involve US users or are conducted anywhere in or through the country. In other words, the crypto mixer is strictly off bounds.

Perhaps unsurprisingly, it’s boiling the tempers of crypto’s loudest libertarian evangelists. “The Treasury department seems to think that merely using tools to enhance anonymity and privacy is a crime,” civil liberties and cryptocurrency attorney Marta Belcher told me.

Tornado Cash is designed to be decentralised, for nobody to be in control. “Tornado Cash is not a person, nor a business entity. It’s an open source software tool. It cannot be sanctioned, it does not respond to subpoena or legal request,” tweeted Erik Voorhees, founder of exchange ShapeShift and a noted libertarian preacher and crypto crusader.

But already the sanctions seem to have had some effects. Tornado Cash’s open source software is hosted on GitHub, a US company that specifically prevents violation of export sanctions in its terms of service. Within hours it had complied, as did Circle, the US-based stablecoin provider.

This has longer-term implications. If regulators can sanction code like Tornado, then crypto mixing services on Ethereum are not the decentralised and private entities that people think they are.

But philosophical debates may be besides the point. As many Russians have discovered, sanctions are a bludgeon and not a scalpel.

“Whatever your view of sanctions, financial companies and crypto companies have to make decisions to protect their customers, employees and businesses because these sanctions will be enforced,” Mike Castiglione, a former CIA employee and director of regulatory affairs for digital assets at Eventus, told me.

On Friday, Dutch financial crime authorities said they had arrested a man during the week who is suspected of involvement in concealing criminal financial flows and facilitating through Tornado Cash.

And a US Treasury official told my colleague James Politi that this week’s crypto mixer designation will not be its last.

“You might have that libertarian desire, but you’ve lost . . . that’s what the law requires, whether you like it or not,” John Reed Stark, former chief of the SEC’s Office of Internet Enforcement, told me on a call earlier this week. “The United States is not going to be Switzerland when it comes to finance.”

I’d like to hear from you. What’s your take on the US Treasury and Tornado Cash? Email me at [email protected].

The week’s highlights

  • HotBit — the “leading cryptocurrency trading platform” you’ve probably never heard of before — suspended operations in one of the most chaotic crypto announcements I’ve ever read. It said a former employee had violated company rules and maybe criminal laws with a project, but somehow other senior managers had been subpoenaed and law enforcement authorities had frozen some of HotBit’s assets. The company says it has “no knowledge of the illegal information” and is “actively co-operating” with authorities. Users may or may not be reassured by the company’s statement that assets and data are “secure and correct”. Here is the platform’s official and very serious Twitter announcement, together with a GIF showing an anime cartoon girl in tears. Great stuff.

  • Coinbase’s tough year continued with second-quarter results registering a $1.1bn loss as revenues and trading volumes dwindle. There was also noise about the exchange receiving investigative subpoenas from the SEC on some of its current and future products, as well as staking programs, stablecoin and yield-generating products. This, however, is not new. Coinbase has been disclosing receipt of these subpoenas for months, here, here and here.

  • Five years ago, BlackRock chief executive Larry Fink described bitcoin’s popularity as a sign of how much “demand for money laundering there is”. A year ago, he said: “In my last two weeks of business travel, not one question has been asked [about bitcoin and crypto]”, adding “we see very little in terms of investor demand on those types of things”. Yesterday, the asset management giant launched a bitcoin private trust, praising bitcoin as the “primary subject of interest from our clients within the cryptoasset space”. What’s changed, Larry? My inbox is open.

  • The Bank of England raised alarm bells on future job losses in a growing metaverse industry. “If a sizeable open-metaverse materialised, households may hold a greater share of their wealth in cryptoassets . . . indirectly, if people are increasingly employed in jobs in metaverse-based settings, their employment outcomes may be affected by risks from cryptoassets,” the BoE said in a recent Bank Underground blog post.

Soundbite of the week: Coinbase ‘could go to zero’

Coinbase’s poor Q2 performance has brought out the bears. According to David Trainer, chief executive of investment research firm New Constructs, the worst may be yet to come. Here’s what he told me via email this week:

“This poor performance continues to align with our opinion that Coinbase is a competitively disadvantaged company with a terribly overvalued stock. We think the stock falls into the teens with potential to go to zero and be a Zombie stock if no one steps in to buy it out.” 

Data mining

Are innocent users being unfairly punished by sanctions on crypto mixers? Russia-born Ethereum founder Vitalik Buterin said this week he’d personally used Tornado Cash in the past to donate to Ukraine. For obvious reasons, he didn’t want it public at the time.

But data from companies that track blockchain payments suggest that good actors are minor players. Earlier this year, blockchain analytics platform Chainalysis broke down where exactly funds sent to mixers originally come from. Unsurprisingly “illicit sources” is the overwhelming source of funds for mixers.

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Gerhard Schröder sues German parliament for shutting down his office

Germany’s ex-chancellor Gerhard Schröder is suing the Bundestag to restore the parliamentary privileges it stripped him of in May after he refused to distance himself from Russian president Vladimir Putin over the Ukraine war.

Schröder’s lawyer Michael Nagel told the DPA news agency on Friday that the lawsuit had been filed with a Berlin administrative court. In it, the former chancellor said the decision of the Bundestag budget committee to shut down his parliamentary office was unlawful.

“It was asserted that the former chancellor Gerhard Schröder no longer carries out any lasting official duties” but it was “not established what these ‘lasting official duties’ actually are, how to determine if they are being carried out or not and what procedure should otherwise be followed”, the lawsuit argued.

The suit said such decisions “are reminiscent of an absolutist princely state” and should not hold true in a democratic country governed by the rule of law.

Schröder has come under mounting criticism in Germany since the outbreak of the war in Ukraine over his friendship with Putin and his continuing involvement in Russian state-controlled energy companies.

He stood down as chair of oil company Rosneft in May but is still head of the shareholders’ committee of Nord Stream AG, which operates a crucial pipeline under the Baltic Sea bringing Russian gas to Europe.

Schröder has also caused outrage in Germany with his views on the Russia-Ukraine conflict. Before Russia’s invasion, he accused Ukraine of “sabre-rattling” for warning about the threat of war.

In April, he told the New York Times he did not think Putin was to blame for the alleged war crimes committed by Moscow’s troops in towns such as Bucha, north-west of Kyiv, saying only “that has to be investigated”.

However, the Bundestag budget committee did not cite Schröder’s roles in Russian energy companies or his attitude to the Ukraine war when it struck off his privileges. The only reason given for the decision was that he “no longer fulfils any obligations arising from his office”.

Officials said privately at the time that they wanted to avoid the impression that the former chancellor was being punished for his controversial opinions.

Before the Bundestag’s decision, Schröder received more than €400,000 a year in taxpayers’ money to cover the personnel costs incurred in running his office. He kept his pension of €8,300 a month, as well as his personal bodyguard.

Senior officials from Schröder’s Social Democrats have repeatedly called on him to quit the party. However, an internal arbitration panel of the SPD this week rejected several applications for him to be excluded from the SPD and said he could remain a member.

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Spain says gas link to wider EU could be ready within months

Spain has said an additional link in a gas pipeline from the Iberian peninsula to France could be ready within nine months after Germany backed the idea of linking the region to central Europe to improve the continent’s energy security.

Spanish energy and environment minister Teresa Ribera said on Friday that a new section of pipeline from Spain into France could be constructed in less than a year as part of attempts to wean Europe off Russian gas.

The new link, could increase Spain’s capacity to export gas by 20-30 per cent, she told Spanish broadcaster TVE.

Portuguese prime minister António Costa said: “Germany can count 100 per cent on Portugal’s commitment to the building of a gas pipeline.” Writing on Twitter on Thursday, Costa added: “Today gas, tomorrow green hydrogen.”

The move comes as Europe is grappling with the biggest energy crisis in at least a generation following Russia’s full-scale invasion of Ukraine in February. Moscow has cut gas supplies to Europe and there are risks of shortages this winter and in 2023 if Russian exports are reduced further.

The loss of Russian supplies, which met 40 per cent of EU demand before the invasion, has forced Europe to rely more heavily on imported cargos of seaborne liquefied natural gas.

But much of Europe’s LNG import capacity lies on the Iberian peninsula, which is viewed in the industry as a gas “island” as there is limited pipeline capacity connecting it to northern Europe.

German chancellor Olaf Scholz said on Thursday that he had discussed a new pipeline with the leaders of Spain, Portugal and France and European Commission president Ursula von der Leyen.

He added that there would also be “other connections between north Africa and Europe that will help us to diversify our [energy] supply”.

Europe is having to find ways to rejig its internal pipeline arteries, which were designed based on the assumption that much of the continent’s supply would flow from Russia.

Even if the continent can secure alternative supplies such as LNG or more pipeline exports from countries including Norway or Algeria, there are concerns about bottlenecks in moving supplies eastward to countries closer to Russia.

Wholesale gas prices in Europe have soared to almost 10 times the average level of the past decade.

The EU is trying to emphasise “solidarity” over sharing and conserving energy supplies among member states ahead of what is expected to be a difficult winter. But there are still question marks over rules and agreements governing how to distribute resources if there are widespread shortages.

Until the new pipeline is completed, Costa said the port of Sines on Portugal’s south-west coast could be used as a logistics hub to ship LNG into the rest of Europe.

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Issey Miyake, fashion designer, 1938-2022

In 2014, the late architect Zaha Hadid explained her love of Issey Miyake’s clothes to the Financial Times, saying “when they are on show in the shop it’s one thing, but once you wear them, they become something else. They are animated.”

Steve Jobs was another famous fan who prized the marriage of form and function in Miyake’s designs — the founder of Apple first discovered the designer when he saw the uniforms he had created for Sony employees. Jobs’s staff rejected his idea of commissioning Miyake to create vests for them, but the designer did make the black turtleneck that became the entrepreneur’s signature look. Jobs told his biographer: “I asked Issey to make me some of his black turtlenecks that I liked, and he made me a hundred of them.”

Miyake, who died on August 5, aged 84, set up his label more than 50 years ago. It still has a loyal following, thanks to his clothing’s ability to make a statement while being easy to wear.

Worn by other well-known figures from Grace Jones in the 1980s to Meryl Streep and Kim Kardashian, Miyake is best known for his sculptural pleated garments. He fused the worlds of art and fashion, as well as the cultures of east and west, and the traditional with technical innovation. For his work, he was awarded the Order of Culture in Japan in 2010, and the French Légion d’Honneur in 2016.

Miyake’s fascination with pleats began in the 1980s, leading to the launch of his Pleats Please line which he launched in 1993 © Patrick Kovarik/AFP/Getty Images

Born in 1938, Miyake was seven years old when the United States dropped an atomic bomb on his home city of Hiroshima. He was generally reluctant to talk about the nuclear attack, so as not to become labelled as the designer who survived it. But in 2009 he recalled the event in an opinion piece in The New York Times, deciding it was his responsibility to discuss it. He wrote: “when I close my eyes, I still see things no one should ever experience: a bright red light, the black cloud soon after, people running in every direction trying desperately to escape.” Within three years of the blast, his mother died from radiation exposure.

He added that he tried “albeit unsuccessfully” to put the past behind him, “preferring to think of things that can be created, not destroyed, and that bring beauty and joy. I gravitated toward the field of clothing design, partly because it is a creative format that is modern and optimistic.”

Miyake studied graphic design in Tokyo, and moved to Paris two years after his graduation in 1963, where he worked as an assistant to Guy Laroche and Hubert de Givenchy. He witnessed the May 1968 student riots while there, which inspired him to create clothing for “the many rather than for the few”. After a period in New York, he founded the Miyake Design Studio in Tokyo in 1970, and within a couple of years was exploring with technical fabrics. He began showing his collections in Paris in 1973.

Miyake’s signature pleats began to take shape in the late 1980s when he experimented with a technique that involved pleating clothes after they had been cut, using a heat press to shrink them into the desired size, shape and texture. The finished garments can be washed and air dried without losing their shape.

He employed the method to make clothes for a production by the Frankfurt Ballet, in order to give the dancers freedom of movement, then used it for the Pleats Please Issey Miyake line which he launched in 1993. Another innovation, in 1998, was A-POC, or A Piece of Cloth, a new technique whereby a single thread fed into an industrial knitting machine could create tubular garments through computer programming — these garments could then be cut into customised looks.

Denis Bruna, chief curator in the fashion and textile department at the Musée des Arts Décoratifs in Paris, which holds 154 Miyake pieces, considers him “the designer who brought Japanese vision and techniques into western fashion. He innovated through materials and shapes, while using traditional techniques, in particular the flat cut commonly used in Japan where the garment only takes shape on the body. Along with Kenzō Takada he showed that it was possible to make a career in France.”

Models dresssed in long black dresses on the catwalk with Issey Miyake at a show in Tokyo in 1987
Miyake’s clothing was known for its ability to make a statement while being easy to wear © Roy Garner/ShutterstockShutterstock

Fabien Baron, a renowned art director who worked with Miyake on the bottle for his bestselling fragrance L’ Eau de Issey Miyake, said of his friend, “For someone in fashion he was so humble . . . I learned long after we worked together that he witnessed the Hiroshima bomb, and I think he felt that life was a gift and tried to give as much as he could with his designs and his attitudes. His clothes gave a form of freedom, you could slide them on and just be.”

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China’s CATL cements car battery dominance with €7bn Hungary plant

China’s CATL will build a €7.3bn battery plant in Hungary, increasing its foothold in Europe and cementing its status as the world’s largest car battery manufacturer.

Construction on the factory in the eastern city of Debrecen will start later in 2022, CATL said on Friday. It has planned capacity of 100GWh a year, which would make it the largest “gigafactory” in Europe.

CATL, which supplies batteries to Tesla and Volkswagen among others, did not specify when that target would be reached, but a company filing posted on the Shenzhen Stock Exchange showed that it expected to complete the Hungry factory within five-and-a-half years.

Supplies from the 221-hectare site — CATL’s second in Europe — will be delivered to European carmakers, almost all of which have existing supply deals with the company. Mercedes will initially be the largest single customer.

“The greenfield project in Hungary will be a giant leap in CATL’s global expansion,” said founder and chair Robin Zeng.

“There is no doubt that our plant in Debrecen will enable us to further sharpen our competitive edge, better respond to our European customers, and accelerate the transition to e-mobility in Europe.”

Hungarian foreign affairs and trade minister Péter Szijjártó welcomed the development and said it would be “the biggest-ever greenfield investment in the history of Hungary”.

It is also Hungary’s largest-ever single foreign investment and will create 9,000 jobs.

Thanks to hundreds of millions of euros in subsidies, Hungary has already attracted investment from Korea’s SK, which is building two vehicle battery plants in the country, and Samsung’s SDI.

Japan’s GS Yuasa also produces batteries in Hungary.

BMW is building a factory in Debrecen that will produce mainly electric vehicles.

CATL, which is already building a European site in Erfurt, Germany, is by far the largest car battery producer, with a 35 per cent market share in the first six months of this year, according to SNE Research. The top 10 manufacturers worldwide are all in Asia.

However, European companies have plans to catch up, most notably Volkswagen, which wants to build six car battery plants in Europe, starting with sites in Germany, Sweden and Spain.

Mercedes also has a deal with Stellantis and energy company Total to build factories that will provide 120GWh of battery capacity by the end of the decade.

Later entrants also face a battle to secure raw materials such as lithium, which have soared in cost over the past year.

Additional reporting by Cheng Leng in Hong Kong and Marton Dunai in Budapest

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Huawei’s sales freefall slows as cloud business expands

The sales freefall for Huawei, the Chinese technology group hit by heavy US sanctions, is beginning to subside as the company’s expanding domestic cloud business offsets plummeting smartphone sales.

Huawei said on Friday its total revenue in the first half of the year declined 6 per cent from a year earlier to Rmb301.6bn ($44.7bn), but sales at its enterprise segment, which includes cloud computing, jumped 28 per cent to Rmb54.7bn during the period.

The decline marks an improvement from 2021 when Huawei’s revenue shrank 29 per cent after Washington hit the group with export controls denying access to crucial technology and components.

The measures have primarily affected the group’s smartphone business by restricting its access to the semiconductors needed to power phones. Huawei was forced to sell Honor, one of its top smartphone brands in 2020, to ensure its survival.

Smartphone sales were the main driver of the group’s consumer business, which fell 25 per cent in the first half of this year as a result of weak consumer electronics demand.

“While our device business was heavily impacted, our [enterprise and carrier businesses] maintained steady growth,” said Ken Hu, Huawei’s chair, in a statement.

Huawei said its net profit margin stood at 5 per cent in the first half of 2022, down from 9.8 per cent in the same period last year.

Huawei’s cloud computing arm has successfully beat competitors, including Jack Ma’s ecommerce group Alibaba, to win cloud contracts.

Alibaba and rival Tencent draw about half of their cloud sales from providing services to China’s internet companies, which are struggling under the weight of Beijing’s tech crackdown.

“The China market is entering a new era where customers driving demand are no longer other internet companies but those from traditional industries including state-owned enterprises,” said Zhang Yi, a cloud expert at Canalys.

“Huawei’s relationship with the government is really good, which helps them win business,” said Zhang.

Huawei is also one of the top vendors providing private cloud services, a more highly customised segment of the market often preferred by the country’s lumbering state-owned enterprises and local governments.

While Huawei’s political favour in China has helped buoy the company, the group’s ties to Beijing pose problems abroad.

Canada in May became the latest country to ban Huawei and Chinese peer ZTE from providing 5G services in the country. The Canadian government also instructed telecoms companies to remove Huawei equipment from existing 4G networks.