Thursday. 28/7/2022

The Monocle Minute

Image: Alamy

Opinion / Natalie Theodosi

In the lap of luxury

This week the fashion industry’s largest publicly listed companies announce their second-quarter financial results. These numbers come at a difficult time, with supply-chain disruptions, lockdowns in China, the war in Ukraine and surging inflation sending tremors through the global economy. Yet the appetite for luxury fashion doesn’t appear to have lessened. Leading the way is LVMH. This week the group reported €36.7bn in revenue for the first six months of 2022, a 28 per cent increase on the same period last year. Its fashion and leather goods recorded the highest growth but its wine and spirits also performed well.

A significant factor behind LVMH’s success is the way in which it nimbly refocused on markets such as North America and the Middle East to make up for the slowdown of trade in China and Russia. Another is the enduring value of its brands. Luxury consumers tend to look for familiar names and smart investments, and few can cater better to those demands than the fashion stalwarts that LVMH has skilfully added to its portfolio.

Fuelled by the popularity of its handbags and leather goods, Louis Vuitton remains the world’s most profitable fashion brand. Dior isn’t far behind, having transformed from a small couture house into a €10bn brand since LVMH acquired full control in 2017. With two giants in its stable and its investment in Tiffany & Co – bought in 2021 for $15.8bn (€15.6bn) – starting to show returns, the group is entering the second half of the year optimistic that it can retain its position as the world’s largest luxury group.

Natalie Theodosi is Monocle's fashion editor.

Image: Getty Images

Diplomacy / Saudi Arabia

Oil change

Saudi Arabia’s de facto leader, Crown Prince Mohammed bin Salman, is in Europe this week. It is his first visit to the continent since the 2018 murder of journalist Jamal Khashoggi inside the Saudi consulate in Istanbul. MBS, as he is colloquially known, and Greece’s prime minister, Kyriakos Mitsotakis (pictured, on right, with Bin Salman), signed an agreement on renewable energy in Athens on Tuesday, while the state-run Saudi Press Agency reported that he will meet Emmanuel Macron later this week. These meetings, following a visit to Riyadh by Joe Biden earlier this month, are further evidence that Western leaders are keen to forge closer ties with the energy-rich Gulf state. US intelligence implicated MBS in the Khashoggi killing, a charge that he denies, but a global energy crisis, exacerbated by the war in Ukraine, appears to have changed the calculus. As the West divests from Russian oil and gas, it is now throwing its lot in with another regime with a questionable human-rights record.

Image: Alamy

Infrastructure / India

Road to war

India’s government announced this week that it has created more than 2,000km of road along the country’s vast border with China over the past five years. The news comes at a delicate time in relations between the world’s two most populous nations. Deadly flare-ups, such as those in the mountainous Ladakh region in 2020, have increased the need for the Indian army to send supplies and military assistance to the border at short notice.

“China has been constructing highways and building permanent infrastructure along its side of the border for years and India has been forced to play catch up,” says defence analyst Sajjan Gohel, a guest teacher at the London School of Economics and Political Science. “Recent skirmishes have certainly focused minds in New Delhi, as well as in the capitals of the other Quad nations, and there are genuine fears that there could be a full-scale military confrontation between these Asian powerhouses,” he tells The Monocle Minute. The hope is that such conflicts can be avoided and that this infrastructure can be used for more peaceful purposes.

Sajjan Gohel will have more on this story on today’s edition of ‘The Briefing’.

Image: David Powell

Migration / Spain

Place in the sun

A shift to remote working has led many to seek a sunnier place to perch their laptops but some are making their relocation last longer than just the summer. Coastal regions in Spain, such as the Catalan city of Girona, are seeing some of the largest influxes of foreign-born residents. What the new arrivals gain here, other than sunshine, is a slower pace of life and more time surrounded by nature.

Former residents who left in search of opportunity abroad are also feeling the pull. “It was the quality of life that made me want to move back,” says designer Genís Carreras, who runs his studio from co-working co-operative Cooking. “Most of the people here are in design, architecture and the cultural world.”

Find out more about the cities in the European sunbelt that creatives are flocking to in the latest issue of ‘Monocle Mediterraneo’, which is out now.

Image: Alamy

Business / Japan

Chips off the old block

A global shortage in semiconductor chips since 2020 has stymied the production of everything from cars and consumer electronics to robots. While a number of companies reported last week that the supply of semiconductors is finally increasing again, Japan is taking no chances. The country’s Ministry of Economy, Trade and Industry plans to spend as much as ¥92.9bn (€669m) in subsidies on Japanese chip-maker Kioxia and its US partner Western Digital, shouldering about 30 per cent of the cost of a new manufacturing facility in Yokkaichi city in Mie prefecture.

It’s part of a ¥600bn (€4.3bn) government fund to help ensure that Japan has a stable semiconductor supply in future. Both China and Taiwan are big producers; part of what has prompted Japan to hedge its risks, boost domestic manufacturing and incentivise foreign companies to open factories is the region’s uncertain geopolitics. When the next semiconductor crisis comes, Japan hopes to be ready.

Image: Spark Creative

Monocle 24 / Monocle On Design

Tosin Oshinowo, Commune, Faye Toogood

Architect Tosin Oshinowo discusses material development in Nigeria and we visit the new offices of design studio Commune in Los Angeles. Plus, we meet designer Faye Toogood in her London studio.

Monocle Films / Lisbon

Meet the Photographers: John Balsom

The Jogos da Lusofonia are an Olympics-style sporting event for people from the world’s Portuguese-speaking nations. We dispatched John Balsom – a photographer known for his powerful portraits – to the 2009 games in Lisbon. In our latest film, Balsom shares his memories of the assignment and how he captured such a fast-paced sports story on vintage film cameras. Discover more with The Monocle Book of Photography, which is available to buy today.

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