Business Briefs – December 5, 2018

Mexico’s New President Sees 3-Year Hiatus on Oil Auctions

MEXICO CITY (AP) — Mexico’s new president, Andres Manuel Lopez Obrador, says he will take a three-year break from awarding new oil exploration contracts.

Lopez Obrador wants more investment from private firms that have been awarded concessionary exploration contracts under reforms enacted by his predecessor, Enrique Pena Nieto.

Lopez Obrador said Wednesday he will use the three-year break to evaluate how much investment and production are actually produced by the foreign firms that bid on offshore blocks of oil fields.

He complained the firms haven’t invested much and haven’t produced any oil. He pledged not to cancel existing contracts.

UK’s Key Services Sector Barely Growing Amid Brexit Concern

LONDON (AP) — Britain’s services sector is struggling in the face of Brexit, a survey showed Wednesday, as Prime Minister Theresa May strives to get the support of Parliament for her deal with the EU.

In a monthly survey of a sector that makes up around 80 percent of the British economy, financial information firm IHS Markit and the Chartered Institute of Procurement and Supply found activity the lowest it’s been since July 2016, just after the country voted to leave the EU.

The survey showed little growith in the sector in November. The purchasing managers’ index, a gauge of business activity, fell to 50.4 points in November from 52.2 the previous month. The index is just above the 50-point level that separates expansion from contraction on a 100-point scale.

UK Parliament, PM May’s Govt Face Off in Brexit Showdown

LONDON (AP) — Britain’s House of Commons on Wednesday opened Round Two in the battle between lawmakers and PM Theresa May’s government over her contentious Brexit deal.

The Conservative government is struggling to convince skeptical legislators that the divorce deal it has struck with the EU is good. Next week’s vote in Parliament could sink the agreement and cost May her position.

Opening the second of five days of debate, Home Secretary Sajid Javid told legislators they should back the agreement in a Dec. 11 vote to safeguard Britain’s security relationship with the EU.

Police Arrest 84 in European Crackdown on Italian Mob

THE HAGUE, Netherlands (AP) — Police in Germany, Italy, Belgium and the Netherlands arrested at least 84 suspected mobsters and seized around 2 million euros ($2.3 million) Wednesday in coordinated raids targeting a powerful Italian organized crime syndicate.

“Today we send a clear message to organized crime … across Europe,” said Filippo Spiezia, vice president of Eurojust, the EU prosecution agency that coordinated the raids. “They are not the only ones able to operate across borders; so [is] Europe’s … law enforcement communit[y].”

Italian authorities said Tuesday they had crushed the upper ranks of the Palermo Mafia by arresting 46 people, including one man who may have been the provincial kingpin.

China Strengthens Foothold in EU With Portugal Agreements

LISBON, Portugal (AP) — Portugal is embracing China’s “One Belt, One Road” initiative, which loans funds for large infrastructure projects.

Despite wariness in other EU capitals about Beijing’s strategy, Portugal endorsed the scheme during a state visit by Chinese President Xi Jinping.

The two countries signed Wednesday a memorandum of understanding on cooperation within China’s modern Silk Road initiative, with special emphasis on transport connections and energy.

Brown-Forman Posts Higher Earnings in Fiscal 2nd Quarter

LOUISVILLE, Ky. (AP) — Liquor company Brown-Forman Corp. reported slightly higher second-quarter net income Wednesday on the strength of its American whiskey and tequila sales, but said it’s feeling the pinch from tariffs slapped on its spirits in key European markets.

The Louisville, Ky. company, best known for its Jack Daniel’s Tennessee Whiskey, said tariff-related inventory reductions shaved about 2 percentage points off its underlying net sales growth in the three-month period.

Brown-Forman stockpiled inventories to brace for the effects of EU tariffs that targeted American whiskey and other U.S. products in response to President Donald Trump’s new tariffs on European steel and aluminum. In the first quarter, Brown-Forman estimated stockpiling contributed about two to three points of its underlying net sales growth.