Business
UK secures £10bn deal to supply Norway with warships
Jonathan BealeDefence correspondent and
Jessica RawnsleyBBC News
UK MOD Crown CopyrightThe UK has secured a £10bn deal to supply the Norwegian navy with at least five new warships.
The agreement to provide Type 26 frigates will be the UK’s “biggest ever warship export deal by value”, the Ministry of Defence (MoD) said, while Norway said it would be its largest “defence capability investment” to date.
The government said the deal would support 4,000 UK jobs “well into the 2030s”, including more than 2,000 at BAE Systems’ Glasgow shipyards where the frigates will be built.
UK Prime Minister Sir Keir Starmer said the agreement would “drive growth and protect national security for working people”.
“This success is testament to the thousands of people across the country who are not just delivering this next generation capabilities for our Armed Forces but also national security for the UK, our Norwegian partners and Nato for years to come,” he added.
The deal is also expected to support more than 400 British businesses, including 103 in Scotland, the MoD said.
Speaking to the BBC, defence minister Luke Pollard called it the “biggest British warship deal in history” and “a huge vote of confidence in British workers and the British defence industry”.
But the move was criticised by some in Norway, including Tor Ivar Strømmen, a naval captain at the Norwegian Naval Academy, who said French and German frigates were superior to British.
“The British Navy builds vessels for one role,” he told Norwegian outlet NRK. “It simply has old-fashioned and quite limited air defence.”
The agreement represents a victory for the British government and defence industry over France, Germany and the United States – which were also being considered by Norway as possible vendors.
It will create a combined UK-Norwegian fleet of 13 anti-submarine frigates – eight British and five Norwegian vessels – to operate jointly in northern Europe, significantly strengthening Nato’s northern flank.
The warships will be constructed at the BAE Systems yard in the Govan area of Glasgow, where frigates for the Royal Navy are currently being built.
Scottish Secretary Ian Murray said the choice of the UK “demonstrates the tremendous success of our shipbuilding industry and showcases the world-class skills and expertise of our workforce on the Clyde”.
Norway’s Prime Minister Jonas Gahr Støre, who informed Sir Keir of the decision to select the UK in a phone call on Saturday night, said the partnership “represents a historic strengthening of the defence cooperation between our two countries”.
Støre said the government had weighed two questions in its decision: “Who is our most strategic partner? And who has delivered the best frigates?… The answer to both is the United Kingdom.”
PA MediaThe Type 26 frigates purchased by the Royal Norwegian Navy will be as similar as possible to those used by their British counterparts, and have the same technical specifications.
They are specifically designed to detect, track, and destroy enemy submarines, with deliveries expected to begin in 2030.
UK Defence Secretary John Healey said the UK would “train, operate, deter, and – if necessary – fight together” under the defence deal.
“Our navies will work as one, leading the way in Nato, with this deal putting more world-class warships in the North Atlantic to hunt Russian submarines, protect our critical infrastructure, and keep both our nations secure,” he added.
Citing this year’s strategic defence review, Pollard said Russia had been identified “as the principal threat to not just the UK’s security but NATO’s security”.
“A key threat of that is Russian submarines in the North Atlantic,” he told the BBC. “These new Type 26 frigates are world-class submarine hunters.”
PA MediaEight Type 26 frigates are currently being built at BAE Systems’ Glasgow shipyards for the Royal Navy, to replace its ageing Type 23 frigates – whose service life has already had to be extended.
It is not yet clear how the Norway deal will impact the delivery of the new vessels to the Royal Navy.
A UK defence source said the plan was still to deliver all 8 Type 26 frigates to the Royal Navy within the next decade. Norway has said it wants its first Type 26 delivered by 2029.
British officials told the BBC that the sequencing of delivery for both Norway and the UK still had to be worked out.
Two of the warships, HMS Glasgow and HMS Cardiff, have been built and are currently being fitted out at a second BAE shipyard, Scotstoun. They are due to enter service in 2028.
Another three, HMS Belfast, HMS Birmingham and HMS Sheffield, are under construction.
BAE has also licensed the Type 26 design to Canada and is building the warships in Australia under contract.
As part of a £300m modernisation at BAE Systems, a new shipbuilding hall – dubbed the “frigate factory” – was opened earlier this year.
The Janet Harvey Hall, named after a pioneering female electrician, is large enough for two frigates to be built simultaneously.
The Royal Navy is also buying 5 new Type 31 General Purpose Frigates – which are being built at Rosyth.
The FTSE 100 was in festive mood on Tuesday, closing higher after a report showed improved UK business confidence and the US economy grew more than forecast in the third quarter.
The FTSE 100 index closed up 23.25 points, 0.2%, at 9,889.22. The FTSE 250 ended up just 6.83 points at 22,349.55, while the AIM All-Share closed down 1.67 points, 0.2%, at 758.81.
UK business confidence increased to 47% in December, rising five points from last month and standing 10 points higher than the start of 2025, according to the latest Lloyds Business Barometer.
In addition, optimism towards the wider economy reached a four-month high, up 11 points to 42%. The renewed economic optimism offset a slight dip in firms’ expectations for their own trading prospects, which decreased by one point to 52%.
“It is great to see business confidence ending the year on a higher note,” said Hann-Ju Ho, senior economist at Lloyds Commercial Banking.
Construction saw the sharpest improvement, up 22 points to 61%, its highest level seen this year.
Manufacturing also was up five points to 49%, while retail firms edged higher to 47%, likely reflecting seasonal demand.
In European equities, the CAC 40 in Paris closed down 0.2%, while the DAX 40 ended up 0.2%.
In Copenhagen, Novo Nordisk jumped 9.2% after the US Food and Drug Administration approved its once‑daily Wegovy pill, the first oral glucagon‑like peptide‑1 therapy cleared for weight management.
“As the first oral GLP-1 treatment for people living with overweight or obesity, the Wegovy pill provides patients with a new, convenient treatment option that can help patients start or continue their weight loss journey,” said Novo chief executive Mike Doustdar in a statement late on Monday.
The company expects to launch the Wegovy pill in the US in early January 2026.
Stocks in New York were higher at the time of the London equity market close. The Dow Jones Industrial Average was up 0.2%, while the S&P 500 and the Nasdaq Composite were both 0.3% higher.
The yield on the US 10-year Treasury was quoted at 4.18%, widened from 4.17%. The yield on the US 30-year Treasury was quoted at 4.84%, stretched from 4.83%.
Figures showed US economic growth accelerated in the third quarter of the year, markedly outperforming expectations.
According to Bureau of Economic Analysis data, US gross domestic product expanded 4.3% on an annualised basis quarter-on-quarter in the three months to September 30, easily beating the 3.3% growth predicted by consensus cited by FXStreet, and accelerating from a 3.8% expansion in the second quarter.
ING said the figure was “eye-popping”, primarily due to a strong performance from net trade with exports rising 8.8% and imports falling 4.7%, while consumer spending grew a robust 3.5% versus the 2.7% rate expected.
But while it was a “fantastic outcome”, ING noted fourth-quarter GDP is likely to record growth that is considerably slower, thanks in part to the effects of the month-long government shutdown.
“We also can’t see the net trade component continuing to make such a strong contribution while consumer spending is also set to slow,” ING added.
Other US data was mixed, with industrial production beating expectations, but consumer confidence and durable goods orders falling short of hopes.
The pound was quoted at 1.3481 US dollars at the time of the London equities close on Tuesday, up from 1.3452 on Monday.
The euro stood at 1.1777 dollars, higher against 1.1759 dollars. Against the yen, the dollar was trading lower at 156.37 yen compared to 156.95.
Back in London, Metlen Energy & Metals was the best FTSE 100 performer, rising 6.8%.
It said it has completed the sale of a portfolio of solar farms and co-located battery energy storage systems in Chile to a subsidiary of Glenfarne Group at enhanced terms.
Metlen is an Athens-based aluminium producer and electricity generator. Glenfarne is a New York and Houston-based developer, owner, operator, and industrial manager of energy and infrastructure assets.
In April, Metlen had said Glenfarne unit GAC RS Chile II Spa would pay 815 million dollars (£606 million) for the assets.
On Tuesday, Metlen said the final price to be paid is 865 million dollars (£643 million), reflecting the “value creation opportunities emerging in the Chilean market”.
Videndum plunged 56% as the provider of broadcasting hardware and software said a planned refinancing will, if successful, see current shareholdings “very significantly diluted”, while completion is also not guaranteed.
The firm said the main components of a refinancing proposal have now been agreed in principle with the revolving credit facility lenders and its two largest shareholders.
But the firm warned any share issue would be “very significantly below” their current nominal value of 20p per share.
Gut Gulf Marine Services fared better, climbing 11% after reporting a new contract award that covers two of its large-class vessels in Europe.
Neither the name of the client nor the financial terms of the contract were disclosed, but Gulf Marine Services said the award increases its contracted backlog to 540 million dollars.
Brent oil was quoted at 62.09 dollars a barrel at the time of the London equities close on Tuesday, up from 61.87 dollars late on Monday.
Gold traded at 4,462.05 dollars an ounce, up from 4,440.54 on Monday.
The biggest risers on the FTSE 100 were Metlen Energy & Metals, up 2.80 euro cents at 44.00 euro, Anglo American, up 88.00 pence at 2,993.00p, Antofagasta, up 67.00p at 3,235.00p, BT, up 2.80p at 185.05p and Airtel Africa, up 4.80p at 337.80p.
The biggest fallers on the FTSE 100 were Diageo, down 29.00p at 1,588.00p, Ashtead Group, down 78.00p at 5,192.00p, Convatec, down 3.20p at 238.60p, Burberry, down 16.00p at 1,261.50p and easyJet, down 6.29p at 506.80p.
Wednesday’s economic calendar includes US weekly jobless claims data.
There are no significant events scheduled in Wednesday’s UK corporate calendar.
– Contributed by Alliance News
Business
Tariff jitters: US consumer confidence slips in December; inflation and jobs worries deepen – The Times of India
US consumer confidence weakened in December, sliding to its lowest level since President Donald Trump rolled out sweeping tariffs earlier this year, as households grew more anxious about high prices, trade levies and job prospects, according to a survey by the Conference Board.The Conference Board said its consumer confidence index fell 3.8 points to 89.1 in December from an upwardly revised 92.9 in November, AP reported. The reading is close to the 85.7 level recorded in April, when the Trump administration introduced import taxes on key US trading partners, AP reported.Consumers’ assessment of current economic conditions saw a sharper drop. The present situation index fell 9.5 points to 116.8, reflecting growing unease about inflation and employment conditions. Write-in responses to the survey showed that prices and inflation remained the biggest concern for consumers, alongside tariffs.Short-term expectations for income, business conditions and the labour market were little changed at 70.7, but remained well below 80 — a threshold that can signal a recession ahead. This was the 11th straight month that expectations stayed under that level.Perceptions of the job market also weakened. The share of consumers who said jobs were “plentiful” fell to 26.7% in December from 28.2% in November, while those who said jobs were “hard to get” rose to 20.8% from 20.1%.The softer sentiment follows recent labour market data showing mixed signals. Government figures released last week showed the US economy added 64,000 jobs in November after losing 105,000 jobs in October. The unemployment rate climbed to 4.6% last month, its highest level since 2021.Economists say the labour market is stuck in a “low hire, low fire” phase, as companies remain cautious amid uncertainty over tariffs and the lingering effects of high interest rates. Since March, average monthly job creation has slowed to about 35,000, down from 71,000 in the year ended March. Federal Reserve chair Jerome Powell has said he suspects those figures could be revised even lower, AP reported.
Kate WhannelPolitical reporter
PA MediaGovernment proposals to tax inherited farmland have been watered down, with the planned threshold increasing from £1m to £2.5m.
The climbdown follows months of protests by farmers and concern from some Labour backbenchers.
At last year’s Budget, ministers said they would start imposing a 20% tax on inherited agricultural assets worth more than £1m from April 2026, ending the 100% tax relief that had been in place since the 1980s.
In an announcement put out after MPs had left Parliament for the Christmas recess, Environment Secretary Emma Reynolds said: “We have listened closely to farmers across the country and we are making changes today to protect more ordinary family farms.”
“It’s only right that larger estates contribute more, while we back the farms and trading businesses that are the backbone of Britain’s rural communities, ” she said.
Head of the National Farmers’ Union Tom Bradshaw welcomed the change, telling BBC Radio 5 Live it “takes out many family farms from the eye of a pernicious storm”.
Gavin Lane, president of the Country Land and Business Association, said: “The government deserves credit for recognising the flaws in the original policy and changing course.
“However, this announcement only limits the damage – it doesn’t eradicate it entirely.
“Many family businesses will own enough expensive machinery and land to be valued above the threshold, yet still operate on such narrow profit margins that this tax burden remains unaffordable.”
Ben Ardern, a farmer from Derbyshire, told the BBC said it was “a step in the right direction”.
He said the government should “drop it [the tax] for family farms… and just tax the people who have got the money to tax.
“The big corporations who have just buried money into land – they’re not farmers, they have just done it to avoid tax. Farmers haven’t bought land to avoid tax, we’ve bought land to farm it and grow food.”
In the 14 months since the initial proposal was announced, there have been regular protests by farmers outside Parliament.
Some Labour MPs in rural areas have also expressed concern. At a recent parliamentary vote on the plan, a dozen backbenchers abstained and one, Markus Campbell-Savours, voted against.
Campbell-Savours was subsequently suspended for voting against the government, meaning he now sits as an independent MP.
Conservative leader Kemi Badenoch said in a post on social media: “This fight isn’t finished.
“Other family businesses are still affected by Labour’s tax raid, and we will keep pushing until the tax is lifted from them too.”
Liberal Democrat spokesperson Tim Farron MP said: “It is utterly inexcusable that family farmers have been put through over a year of uncertainty and anguish since the government first announced these changes.
“We demand that the government scraps this unfair tax in full and if they refuse to, Liberal Democrats will submit amendments in the new year to bring it down.”
Reform UK deputy leader Richard Tice said: “This cynical climbdown – whilst better than nothing – does little to address the year of anxiety that farmers have faced in planning to protect their livelihoods… with British agriculture hanging by a thread, the government must go further and abolish this callous farms tax.”
In her first Budget in 2024, Chancellor Rachel Reeves announced she would be reversing the 100% inheritance tax relief on agricultural assets that had been in place since the 1980s.
The move would have seen inherited agricultural assets worth over £1m taxed at 20%, half the standard inheritance tax rate, raising an estimated £520m annually by 2029.
The government had argued that the change would protect smaller farms while stopping wealthy investors from buying farmland as a tax loophole.
However, it has now stepped back from the original proposal raising the threshold level to £2.5m.
Coupled with an exemption which allows farmers to pass on assets to their spouses tax-free, this new government concession means a couple could pass on up to £5m in qualifying assets, without paying tax.
Above the threshold, a 50% relief will be applied to the remaining assets.
According to the government, the number of estates in the UK expected to pay more inheritance tax in 2026/27 will be reduced from around 2,000 under the original plans to 1,100 under the new proposal.
The climbdown is the latest in a series of U-turns the government has made since being elected in July 2024.
Earlier this year the government eased cuts to winter fuel payments and backtracked on plans to make £5bn of cuts to the welfare bill.
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