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EARNINGS

Renault first-half net profit up 56% to €1.2 billion

French car maker Renault saw its first-half profits soar to €1.2 billion despite losses caused by the earthquake in Japan, it said on Thursday in an earnings statement.

Published: 28 July 2011 12:19 CEST

Net profit rose 56 percent to €1.25 billion ($1.72 billion) on record sales that rose 7.3 percent to €21.1 billion, while the earthquake which hit car major parts suppliers cost Renault €150 million.

“The financial results were impacted by external events, including supply constraints, which will subside in the second half, and a considerable increase in the cost of raw materials,” said chief executive Carlos Ghosn.

He said in the statement the group maintained its outlook for operational free cash flow — a key measure of profitability — at more than €500 million this year.

“The supply constraints stemming from the Japanese tsunami had an unfavourable impact on the operating margin of automotive of an estimated €150 million in the first half,” the statement said.

The company said it expected the consequences of the earthquake would cost it a further €50 million this year.

“Supply constraints are expected to subside gradually in the second half, enabling a strong recovery in production from September.”

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FARMING

WTO rules US tariffs on Spanish olives breach rules

A US decision to slap steep import duties on Spanish olives over claims they benefited from subsidies constituted a violation of international trade rules, the World Trade Organisation ruled Friday.

Published: 22 November 2021 11:34 CET
WTO rules US tariffs on Spanish olives breach rules
Farmers had just begun harvesting olives in southern Spain when former US President Donald Trump soured the mood with the tariffs' announcement. Photo: Jorge Guerrero/AFP

Former US president Donald Trump’s administration slapped extra tariffs on Spain’s iconic agricultural export in 2018, considering their olives were subsidised and being dumped on the US market at prices below their real value.

The combined rates of the anti-subsidy and anti-dumping duties go as high as 44 percent.

The European Commission, which handles trade policy for the 27 EU states, said the move was unacceptable and turned to the WTO, where a panel of experts was appointed to examine the case.

In Friday’s ruling, the WTO panel agreed with the EU’s argument that the anti-subsidy duties were illegal.

But it did not support its stance that the US anti-dumping duties violated international trade rules.

The panel said it “recommended that the United States bring its measures into conformity with its obligations”.

EU trade commissioner Valdis Dombrovskis hailed the ruling, pointing out that the US duties “severely hit Spanish olive producers.”

Demonstrators take part in a 2019 protest in Madrid, called by the olive sector
Demonstrators take part in a 2019 protest in Madrid called by the olive sector to denounce low prices of olive oil and the 25 percent tariff that Spanish olives and olive oil faced in the United States. (Photo by PIERRE-PHILIPPE MARCOU / AFP)
 

“We now expect the US to take the appropriate steps to implement the WTO ruling, so that exports of ripe olives from Spain to the US can resume under normal conditions,” he said.

The European Commission charges that Spain’s exports of ripe olives to the United States, which previously raked in €67 million ($75.6 million) annually, have shrunk by nearly 60 percent since the duties were imposed.

The office of the US Trade Representative in Washington did not immediately comment on the ruling.

According to WTO rules, the parties have 60 days to file for an appeal.

If the United States does file an appeal though, it would basically amount to a veto of the ruling.

That is because the WTO Appellate Body — also known as the supreme court of world trade — stopped functioning in late 2019 after Washington blocked the appointment of new judges.

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