Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Is a Greek tragedy being whipped up? Last week Chobani, known for its thick Mediterranean yoghurt, sold $650mn of new CCC+ rated junk bonds. The money was not for an acquisition or to fund new investment. Rather, It was a so-called dividend recap where the money paid off preferred stock held by a single investor, Healthcare of Ontario Pension Plan.
The notes would have cost perhaps 15 to 18 per cent a year or two ago. Chobani instead sold them with a cash coupon of just 8.75 per cent (the company can also elect to pay bondholders with more debt, instead of cash, at a slightly higher rate).
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Abating inflation and steady economic growth have proved powerful enough that fixed-income investors have switched to risk-on, at historical levels no less. The spread between risk-free US Treasuries and investment-grade bonds has fallen to just 83 basis points, the smallest gap since 2005. Junk-bond spreads have similarly tightened, to a spread of under 3 percentage points.
Because base interest rates are higher — the 10-year Treasury yield, for example, is just above 4 per cent — absolute borrowing costs came in lower during the era of zero interest rates. Still, some companies today are aggressively accessing debt markets knowing that capital is eager to be put to work amid limited opportunities in the deals downturn. A CCC-rated benchmark — a pool of the riskiest borrowers — is up 16 per cent this year.
If there is a company worthy of handling a low credit rating it may be Chobani. The new debt is replacing preferred stock, so its leverage ratio of nearly 7 times will remain unchanged. But Chobani’s group revenue — for yoghurt, creamers and grocery items from its La Colombe brand — is growing in the teens. As such, the company is taking in hundreds of millions of dollars of positive cash flow. The new debt is cheap enough that the cash raised is taking out more expensive preferred stock, immediately creating value for common equity holders of the privately held Chobani.
But what if it goes wrong? The new debt is the most subordinated piece of credit that Chobani has issued and S&P projects that it will get no recovery in a hypothetical bankruptcy. A 9 per cent annual yield is apparently enough to compensate for that possibility.
Harrods has told the BBC it is in the process of settling more than 250 claims for compensation brought by women who allege historical sexual misconduct by Mohamed Al Fayed.
The department store said the women have come forward since the release of a BBC documentary more than four weeks ago. The investigation exposed decades of serious sexual abuse allegations against the former Harrods owner.
Harrods has previously said it has already settled a number of claims.
Fayed owned Harrods between 1985 and 2010. Its new owners have previously said they are “appalled” by allegations of sexual abuse by Al Fayed and have been investigating since last year whether any current members of staff were involved.
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The company said it would not provide a “running commentary” of its internal review.
Harrods has a compensation scheme for ex-employees who say they were attacked by Al Fayed, which is separate from a legal case against the luxury department store being brought forward by several different law firms.
Justice for Harrods Survivors group, who represent the accusers of the former Harrods boss, said their lawyers were working with 147 women. It is unclear if there is some overlap between the women seeking compensation from Harrods and those pursuing legal action.
The billionaire businessman, who died last year aged 94, is accused of multiple counts of rape and attempted rape by several women who worked for him – many of whom felt unable to report what had happened until recently.
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At the time of many of the alleged attacks, Fayed was the owner of Harrods, the Ritz Paris hotel and football club Fulham FC.
He was a well-known public figure who had links to senior figures in Parliament and courted royalty and celebrities alike.
The BBC heard testimony from more than 20 female ex-employees at Harrods during its investigation for the documentary and podcast – Al Fayed: Predator at Harrods.
The documentary, which aired last month, found that during Fayed’s ownership, Harrods not only failed to intervene but helped cover up abuse allegations.
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Responding to the investigation, Harrods’ current owners said they were “utterly appalled” by the allegations and that his victims had been failed – for which the store sincerely apologised.
AN iconic high street retailer will start selling vinyl records again after thirty years off the shelves.
WHSmith said it will begin restocking the vintage disc in response to growing demand from shoppers.
As part of the roll-out, music buffs will be able to snap up records from new talent such as Taylor Swift alongside 80’s icons like Queen.
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Over 80 sites across Canterbury, Chester, Edinburgh Gyle and York will stock the records – you can see the full list below.
The newsagent, which has over 1,000 stores across the high street and travel locations, has not sold records at its sites in over three decades.
Collecting vinyl records has become trendy among music fans, as they seek tangible ways to connect with music amid a rise in streaming sites such as Spotify.
Records also come with larger packaging and can include freebies such as posters or clothing.
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Sales for the product grew for the 16th year in a row in 2023, with nearly six million units sold, according to data from the British Phonographic Industry.
Demand for records also helped turn around the fortune of struggling high street retailer HMV.
HMV shut the flagship store in 2019 after the retail chain tumbled into administration and was forced to axe stores and jobs.
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It sells popular culture merchandise lines, some 20,000 vinyl albums and CDs, in excess of 8,000 4kUHD, Blu-rays and DVDs, as well as music technology products.
The record store was once a staple of the UK high street from the early 1970s until 2004.
Shoppers can browse the catalogue online for now only, owners have not ruled out the return to physical stores at some point in the future.
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Ourprice.com stocks around 20,000 vinyl, t-shirts and a range of hi-fi and audio equipment.
Emma Smyth, commercial director, WHSmith High Street said: “After thirty years vinyl is back at WHSmith,
“I’m sure there are many customers out there who remember spending hours in record shops browsing the latest vinyl LPs and the artistic record covers.”
She added: “It’s no surprise that vinyl is growing in popularity again, and we are very excited to be bringing back record selections to more than 80 different stores across the UK for both seasoned fans and new listeners alike.”
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The full list of locations where you c an pick up the latest records are:
Berkhampstead
Bromley
Canterbury
Chester
Crawley
East Kilbride
Epsom
Exeter
Gloucester
Gyle
Henley
High Wycombe
Kingstonis:
Lichfield
Marlborough
Monks Cross
Preston Deepdale
Romford
Salisbury
Watford
White City
York
Jersey
Perth
Stafford
Weston-super-Mare
Northallerton
Douglas
Scarborough
Buxton
Argyle Street
Beeston
Brecon
Brent Cross
Broughton Parc
Bury St Edmunds
Carlisle
Cirencester
Cribbs Causeway
Darlington
Bluewater Park
Deal
Dumfries
Elgin
Ely
Exmouth
Grantham
Great Yarmouth
Hamilton
Harpenden
Haslemere
Hastings
Havant
Haywards Heath
Hempstead Valley
Hereford
Honiton
Leighton Buzzard
Lewisham
Liverpool
Llanelli
Marlow
Monmouth
Morpeth
Newport (Isle of Wight)
Petersfield
Sevenoaks
Meadowhall
Southport
Southsea
Swanage
Taunton
Teesside Retail Park
Temple Fortune
Twickenham
Uckfield
Wallington
Warrington
Wimbledon
Witney
As for WHSmith, the introduction of records will be the latest move from the business to revamp its product line.
Since last year, shoppers have been able to purchase Toys ‘R’ Us products in a number of its stores.
The American toy retailer collapsed in 2018 and closed all of its 100 UK branches, but announced plans for a relaunch in October 2021.
A total of 76 WHSmith sites will have a Toys ‘R’ Us section by the end of the year.
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The iconic British brand has struggled on the high street following the aftermath of the pandemic, but its travel arm has been booming.
Despite this, WHSmith has announced plans to open 110 new shops this year in airports, railway stations and hospitals.
Retailers making a comeback
It has been a tough time for retailers since Covid and the last few years have seen many vanish from our high streets.
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The rising cost of living and expensive rents have all been playing a part in the demise of some of our much-loved high street names.
Last year much-loved retailer Wilko fell into administration and closed all of its shops in September 2023, leaving Brits heartbroken.
However, a glimmer of hope was given when the brand name was scooped up by The Range, in a £5million deal – meaning that the name would live on.
Customers were overjoyed after learning the store was being relaunched online, and even more so when in a surprising turn of events, physical branches started to open up again.
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Elsewhere, Paperchase is now available to purchase at Tesco stores following its collapse almost three years ago.
And there has been talk that Topshop could return to the high street after a nearly four-year hiatus.
Owners ASOS said last month it would sell a 75% stake in the brand to Bestseller, a Danish retail group that owns Jack & Jones.
José Antonio Ramos Calamonte, chief executive of ASOS, told reporters that the deal would make Topshop “more accessible”.
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Retailers opening stores
IT’S not all bad news on the high street as several retailers are bucking the trend and opening shops.
German discounter Aldi has announced it will open 35 new UK stores this year. The openings form part of Aldi‘s long-term target of operating 1,500 stores in the UK.
Purepay Retail Limited , the parent company of Bonmarché, Edinburgh Woollen Mill (EWM) and Peacocks, Purepay Retail Limited, has said it wants to open 100 new high street stores over the next 18 months.
IT’S nearly time to get on board for the festive season – with a Christmas markets cruise.
Need to stock up on presents? Fancy some yuletide treats?
Or how about admiring some of the best seasonal lights in Europe?
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Sophie Swietochowski brings you some crusies that will invite you to do all of that and more . . .
BEST FOR FESTIVE VARIETY – COLOGNE
COLOGNE in Germany, with its majestic cathedral, pictured, has long been a top European destination to visit for Christmas markets.
And there is more than one of these in the city.
But one of the best is Heinzel’s Winter Fairytale, which has its own ice rink, and is one treat that revellers setting sail on Emerald Cruises’ Rhine voyage should definitely add to their bucket list.
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Emerald’s eight-day river cruise begins in wintry Basel in north-west Switzerland before passing by Strasbourg, where passengers can take a guided tour, then it continues via several German cities including Koblenz.
The itinerary ends in Amsterdam where shops will soon be filled with festive local treats such as speculaas – spicy cinnamon biscuits also called windmill cookies.
The Christmas Markets on the Rhine cruise costs from £1,699pp, including flights on December 14, and transfers, wifi and excursions.
Nuremberg Christkindlesmarkt takes place in the Hauptmarkt, the central square of Nuremberg’s old town.
BEST FOR SOLO TRAVEL – NUREMBERG
UNIWORLD Boutique River Cruises have £1,000 off a host of festive cruises – many charging no solo supplement.
Single travellers can join an eight-day German cruise through so-called Christmas Country, along the River Main from Nuremberg to Frankfurt.
Highlights, aboard the River Princess ship, include a tour of Nuremberg and a visit to the city’s Christmas market – the largest and grandest in Germany, famed for its gingerbread.
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Explore medieval city of Bamberg’s nativity trail, linking churches, museums and more.
The itinerary also includes a walking tour of medieval town Rothenburg, with its timber-framed houses, cobbled streets and tiny squares, plus visits to Würzburg, Wertheim and Frankfurt.
From £2,199pp for eight-day tour, no solo supplement, departures on December 8, 22 and 23.
WHICH yuletide tune instantly reminds you of Christmas?
If it’s The Snowman: Walking In The Air, book a spot on this four-night Cunard voyage.
Welsh singer Aled Jones will be on board to amp up the festive factor, with talks about The Snowman and live performances of carols such as Silent Night and O Holy Night.
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The no-fly cruise on board the Queen Victoria, which can carry more than 2,000 passengers, departs from Southampton in early December, sailing straight to Bruges in Belgium.
This is the place to stock up on chocs, as the Belgians are known for producing the world’s best.
The ship then sails to Cherbourg in Normandy, home to a Christmas where treats include French favourite vin chaud (mulled wine).
The Cherbourg and Zeebrugge cruise costs from £669pp, in a Britannia Balcony room, departing on December 1.
A DANUBE river cruise takes in merry markets crammed with traditional grub such as Austrian grammelknödel (a steaming potato dumpling), as well as celebrating all things Mozart.
The three-night adventure begins in the German city of Passau, after which you’ll cross the border into Austria, ticking off the historic town of Melk, home to an 11th Century abbey where Benedictine monks still live.
Next stop is Bratislava, Slovakia’s pedestrianised capital filled with cosy cafes, before moving on to Vienna – a highlight on the itinerary where passengers can visit Mozart’s home or listen to music in the famous Opera House.
The three-night Christmas Spirit on the Danube cruise on board the Riverside Mozart costs from £1,108pp, departing on December 5.
The Dutch city of Rotterdam takes Christmas very seriously, lighting up the streets in a spectacle of colour.
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It’s also the first stop on the Ambassador line’s ship Ambience, which departs from Essex port of London Tilbury.
Once you’ve sailed down the River Nieuwe Maas and ticked off Rott-erdam, Ambience will head for Honfleur in northern France.
Here, passengers can explore the Christmas markets in the town hall square, with stalls selling everything from stocking fillers to freshly baked treats.
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The final stop is Amsterdam, where canalside trees will be festooned with lights.
Check out festive celebration Sinterklaas, and the Amsterdam Light Festival which features more than 25 specially created works of art.
The five-night sailing costs from £499pp, departing London Tilbury on December 15 and based on two people sharing an inside cabin.
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
The UK has launched a major review of sentencing policy as part of efforts to ease overcrowding in English and Welsh prisons and ensure “no government is forced into the emergency release of prisoners ever again”.
Led by David Gauke, the former Conservative justice secretary, the review will explore “tough alternatives to custody” as a way of addressing overcrowding in jails, which have been at the brink of capacity for more than a year.
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The review was announced on Tuesday by the justice ministry, the same day that a fresh cohort of about 1,100 prisoners will be released under emergency measures to free up cell space.
The early release scheme was initiated by the Labour government after it came into office in July, inheriting a prison system that in the words of justice secretary Shabana Mahmood was “within days of collapse”.
About 1,700 inmates were freed on September 10 under the policy, which reduces the period of time served for some offenders, excluding those serving four years or longer for violent and sexual offences, from 50 to 40 per cent of sentences.
The fresh wave of releases will include inmates who have been sentenced to more than five years in jail. The first round came into force for those serving sentences of less than five years.
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The justice ministry said Gauke would, among other things, look at the use of technology “to place criminals in a ‘prison outside prison’” and community work so that prisons never reach this point of crisis again.
“I believe in punishment. I believe in prison, but I also believe that we must increase the range of punishments we use. And that those prisoners who earn the right to turn their lives around should be encouraged to do so,” said justice secretary Shabana Mahmood.
She added that the review would ensure “there is always a cell waiting for dangerous offenders”.
Gauke, who will submit his findings next year, said he would explore how to move the justice system out of crisis and towards a more sustainable future.
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“Clearly, our prisons are not working. The prison population is increasing by around 4,500 every year, and nearly 90 per cent of those sentenced to custody are reoffenders,” he said.
The prison population in England and Wales has roughly doubled in the past 30 years to 87,000, as successive governments have introduced longer sentences.
Conditions in prisons have steadily worsened over the period, with the independent inspectorate of prisons warning in recent reports of surging levels of drug use, violence and failing rehabilitation.
The ministry of justice has committed to building an additional 14,000 prison places in England and Wales, up from 87,900 in July. Mahmood has indicated that the number of women sent to jail could also be sharply reduced.
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Charities welcomed the launch of the review, saying it signalled a recognition that the government cannot build its way out of the crisis.
Both short sentences, which prison charities have long warned are often counter-productive, and longer sentences for more serious offences, will come under scrutiny by the review.
“We hope that the government will accept that to have a safe and sustainable prison system, the sentencing has to be brought in line with the resources available,” said Andrew Neilson, campaigns director at the Howard League for Penal Reform, a charity that advocates for changes to the prison system.
He added that there was a quantitative crisis in prison, due to the pressure on cell space, but there was also a “qualitative” one due to the erosion of rehabilitation and training behind bars.
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“Prisons are not doing anything to rehabilitate people — they are actively making people worse,” he said.
Overall, about 5,500 inmates are expected to be released under the emergency measures. But because of an influx of about 400 new inmates since rioting in the summer, the Prison Governors’ Association has said the early release programme would only buy the government around a year’s leeway at best.
Mark Day, deputy director of the Prison Reform Trust, called the review “a vital opportunity to reset the dial on decades of failure in penal policymaking”.
Placing your airer in the wrong part of your house can extend the drying process, meaning you have to run the appliance for longer and at greater cost.
In fact, according to USwitch this could mean spending an extra 38p a wash load – pushing your bill up by as much as £90 across the year.
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Energy spokesman Ben Gallizzi told The Sun: “It’s worth thinking about where to place your heated dryer in order to maximise its efficiency.”
“Try to avoid large, cold rooms that will slow down the drying process.”
He said that the appliances can cost different amounts to run depending on the amount of kWh, but under the new energy price cap can cost anywhere between 7p and 29p per hour.
This is compared to a tumble dryer which uses 2.5kWh of energy per cycle and costs 61p.
Laura Court-Jones, Small Business Editor at Bionicshared her tips.
1. Turn your heating down by one degree
You probably won’t even notice this tiny temperature difference, but what you will notice is a saving on your energy bills as a result. Just taking your thermostat down a notch is a quick way to start saving fast. This one small action only takes seconds to carry out and could potentially slash your heating bills by £171.70.
2. Switch appliances and lights off
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It sounds simple, but fully turning off appliances and lights that are not in use can reduce your energy bills, especially in winter. Turning off lights and appliances when they are not in use, can save you up to £20 a year on your energy bills
3. Install a smart meter
Smart meters are a great way to keep control over your energy use, largely because they allow you to see where and when your gas and electricity is being used.
4. Consider switching energy supplier
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No matter how happy you are with your current energy supplier, they may not be providing you with the best deals, especially if you’ve let a fixed-rate contract expire without arranging a new one. If you haven’t browsed any alternative tariffs lately, then you may not be aware that there are better options out there.
How else you can save on energy
One important energy-saving tip to know is to never dry your clothes on the radiator, as this stops it from heating your home efficiently.
As a result, up to £55 could be wasted across the year.
The exact wastage depends on the size of your house and how much energy you use.
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Heat can also escape your home through your chimney – The Sun recently wrote an article on how newspaper can be used to stop it from escaping.
By filling a bin bag with newspaper and stuffing it inside of your chimney, you could save as much as £90 across the year and reduce bills by 5%.
You could also buy a damper, which is designed to seal your chimney by blocking the flue system.
However these cost anywhere from £21 on Amazon, and as much as £84 from TLC Electrical.
As Americans prepare to vote for their next president, Canadians and Mexicans are watching on nervously.
For some Canadians living next to the US border, politics isn’t a topic often discussed.
“You don’t talk politics and you don’t talk religion,” says 85-year-old Ernie, who lives in the Canadian town of Fort Erie, just across the Niagara River from Buffalo, New York.
Yet for others in Fort Erie, Ontario, politics can come up, especially after a few beers, and with a US presidential election fast approaching.
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A short walk from the Peace Bridge that connects the two countries is Southsides Patio Bar & Grill, where US-born bartender Lauren says she frequently has to break up political arguments.
“It happens, especially after a few drinks. Everybody’s voice is heard here,” she laughs while shaking her head.
Some 2,000 miles (3,200 km) southwest in the Mexican border city of Juarez, Sofia Ana is in the Monday morning queue of cars waiting to cross to El Paso, Texas for work.
“There’s better employment opportunities in the US, there’s better benefits,” she explains.
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Ana is one of an estimated 500,000 Mexicans who legally cross the border into the US every week day.
It is in their interest that relations between the two countries remain cordial. “It affects us deeply… it is very intense,” adds Ana from her car window.
With more than 155 million Americans due to vote in the US presidential election on 5 November, it is fair to say that the outcome will be felt well beyond the US. No more so than its largest trading partners Canada and Mexico.
The two-way trade of goods between the US and Mexico totalled $807bn (£621bn) last year, making Mexico the US’s biggest trading partner when it comes to physical items.
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Meanwhile, the US’s goods trade with Canada in 2023 was in second place on $782bn. By comparison the figure for the US and China was $576bn.
Mexico and Canada’s future trade with the US could be impacted if Donald Trump wins the US election. This is because he is proposing to introduce substantial import tariffs. These would be 60% for goods from China, and 20% on products from all other countries, apparently including Mexico and Canada.
By contrast, Kamala Harris is widely expected to maintain the current more open trade policies of President Biden. This is despite the fact she voted against the 2020 United States Mexico Canada Agreement (USMCA) free trade deal, saying it didn’t go far enough on tackling climate change.
Trump and Harris have “starkly different visions for the future of US economic relations with the world”, said one study in September.
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Back in Juarez, shop owner Adrian Ramos says that US political instability is something business owners like himself have had to get used to. “We’ve seen it all,” he says.
Mr Ramos adds that the result in the US on 5 November will likely impact on his business whoever wins. “If Trump wins, it’s going to take longer to cross over to the States, if Harris wins, it may not, but there will be changes depending on who wins.”
In the rural Canadian township of Puslinch, Ontario, beef farmer Dave Braden is definitely more concerned about Trump returning to the White House.
“The worry with Trump is that he’ll introduce a policy [such as tariffs], and just say ‘get on with it’ and that is threatening,” says Mr Braden, standing between hay bales in front of one of his cattle fields.
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“I think with Harris, we have the assumption that she will recognize the relationship between the two countries and we will work together.”
The Canadian Chamber of Commerce is also concerned about the possibility of a second Trump presidency introducing new tariffs. It calculated that tariffs of 10% on Canadian imports (a level that Trump has previously suggested), would cost each Canadian and American $CA1,100 ($800; £615) per year.
The Canadian government has reportedly been talking to Trump’s camp to try to exempt Canada in the event that he does win the election.
Not every Canadian has such fears about Trump though. One Ontario farmer who is supporting him didn’t want to speak on the record, but says he believes the former president is stronger on the economy, which would benefit Canada.
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For Georganne Burke, the Republicans Overseas chapter leader for Canada, it’s no surprise that some Trump supporters don’t speak publicly about him. She says that backing Trump is “not a popular position to be in”.
Recent polling suggests that Harris is significantly more popular than Trump among Canadians.
The USMCA, which was negotiated in 2018 under Trump’s presidency, is up for renegotiation in 2026.
With that on his mind, Canada’s Minister for Innovation, Science and Industry Francois Champagne tells the BBC he is checking the US election polls daily.
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“Because this is such a valued relationship. It’s why I call it this indispensable relationship, because when you look at everything, you realise how indispensable we are to each other,” he explains.
In the run up to the election Mr Champagne is spending time meeting American counterparts of both parties. In his words “connecting the dots”.
“For example, when I meet the governor of South Carolina, which has a plant in the auto sector, I remind him that a lot of the critical minerals are coming from Canada,” he says. “So, it’s making sure that everyone understands that we are joint at the hip in terms of security, supply chain, but also a growth agenda for North America.”
Lila Abed, an expert on US-Mexico relations, says that whatever November’s outcome, “there will be three essential topics on the bilateral agenda with Mexico that are going to have to be dealt with immediately” – migration, security and trade.
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“It is telling that [new Mexican president] Claudia Sheinbaum hasn’t designated Mexico’s ambassador to the US,” adds Ms Abed, who is director of the Mexico Institute at the Washington-based Wilson Centre think tank.
“I don’t believe that will be announced until after the US presidential election, because she wants to take into consideration what kind of individual she wants in Washington after the result.”
Looking ahead to 2026, Ms Abed believes the USMCA renegotiation will focus on US efforts to stop increased Chinese investment in Mexico.
“Where Republicans and Democrats actually coincide is on trying to stem or trying to stop Chinese investment in Mexico, which is something that both political parties in the United States are very concerned about,” she says.
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“While I believe that, you know, the tone and the policies will naturally differ depending on who wins the White House, I do believe that the main issues on the bilateral agenda will remain.”
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