Bad week in prospect for Kazakhstan, chancellors and Kingfisher

The economic situation is looking bleak in Britain, France – and even in the booming commodities sector

There's a cracking old tale about the FTSE 100 miner, Kazakhmys, involving it paying a £30,000 bill for the Kazakh president, Nursultan Nazarbayev, after he spent five nights at London's swanky Lanesborough hotel during 2006.

That fuelled theories that the company is really run by the Kazakh state, and while that speculation refuses to subside, the share price has been less stubborn, slumping by about 60% since those glory days.

There will be more bad news this week when the company reports its 2012 results, which will see it write down the value of assets – the effects of soaring costs and its 26% holding in another struggling Kazakh miner, ENRC, which cancelled its dividend last week.

All of which seems to be signalling some sort of major shake-up this year, as Nazarbayev is unlikely to be too amused about the declining value of his country's stakes in these businesses.

Still, the old autocrat is not without a sense of humour. The Lanesborough bill shows the president spent £9 on having "Spectator Magazines" delivered to his suite – at a time that coincided with the magazine publishing a substantial Kazakhstan feature entitled "Who needs Borat?". The author? One N Nazarbayev.

Is Osborne in line for a new dressing down?

Newspapers were filled last week with the obligatory case studies carrying headings such as "married couple, two children"; "couple, pensioners, state pension"; or "couple, no children" – all under the heading of "what the budget means to you".

This week we get a similar exercise looking at how the annual financial showcase affected a married man with two children living at 11 Downing Street, as the Treasury select committee hears from a pack sent over from the Office for Budget Responsibility, as well as Osborne himself.

Chairman Robert Chote, plus his sidekicks Steve Nickell and Graham Parker, will be dissecting the chancellor's latest offering – which should prove an interesting exercise, as Chote has just ticked off the prime minister over the latter's false claim that the OBR is "absolutely clear that the deficit reduction plan is not responsible" for the UK's lack of growth.

Still, he might soon change that view. The Office for Budget Revisionism has just slashed its 2013 growth forecasts (again) and is quickly gaining a reputation as the world's dodgiest economic forecaster – in a strong field.

Even B&Q can't stop the money leaking away

Bad weather, weak consumer confidence, unfavourable foreign exchange rates – these are just some excuses companies love to invoke to explain weak performance.

Investors in the DIY retailer Kingfisher will be handed all of the above this week and asked to assemble them into a robust-looking outlook for the company, as the firm attempts to put a layer of gloss on its tired-looking results. The worry is that, like some poor chap struggling to fix his own plumbing, shareholders might eventually conclude that it's not worth the effort.

UK sales – effectively B&Q, but also a small amount of Screwfix – will be down almost 6% on a same-store basis but there seems to be even worse news in the pipeline. France accounts for 48% of the group's profit, and while same-store sales will fall by about 2.4%, there are plenty who fear the country's finances are set to implode.

All of which translates to pre-tax profits falling by around 11% and analysts fretting that a so-called "self-help plan" that was supposed to deliver an extra £300m of annualised retail profit by its fifth year will simply get absorbed by the financial crisis.

That's the problem with these do-it-yourself efforts – often they simply paper over the cracks.

Contributor

Simon Goodley

The GuardianTramp

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