Welcome to November's issue of Credit Management News Digest. This issue is sponsored by Chubb.

Index
 
UK Economy & Brexit
The UK economy could be 3.5% smaller under the latest Brexit deal. The National Institute of Economic and Social Research (NIESR) has cautioned that it would not expect UK economic activity to be boosted by the approval of the government’s latest proposed Brexit deal and estimate that, in the long run, the economy would be 3.5% smaller with the deal compared to continued EU membership. Furthermore, with the assumption that chronic uncertainty persists and the terms of EU trade remain unchanged, NIESR forecasts economic growth of under 1.5% in 2019 and 2020, though the forecast is subject to significant uncertainty. Overall, NIESR estimates that the economy is 2.5% smaller now than it would otherwise have been as a result of the 2016 Brexit vote. To read NIESR's news release go to https://www.niesr.ac.uk/media/niesr-press-release-uk-economy-35-cent-smaller-under-latest-brexit-deal-13975.
UK GDP growth over the last year has slowed to its lowest rate in almost a decade. Latest Office for National Statistics (ONS) data has indicated that UK GDP grew by 0.3% in Q3 2019 after contracting by 0.2% in Q2. When compared with the same quarter of 2018, GDP grew by 1.0% - the lowest rate of growth since Q1 2010. An ONS Statistician said: “GDP grew steadily in the third quarter, mainly thanks to a strong July. Services again led the way with construction also performing well. Manufacturing failed to grow as falls in many industries were offset by car production bouncing back following April shutdowns. Looking at the picture over the last year, growth slowed to its lowest rate in almost a decade." To see the ONS' news release go to https://www.ons.gov.uk/economy/grossdomesticproductgdp/bulletins/gdpmonthlyestimateuk/september2019. Licensed under the terms of Open Government. Licence v3.0.
The UK is forecast to experience the lowest growth figures since the financial crisis in 2008-09. Dun & Bradstreet has published its latest UK Economic Outlook which contains insights on the UK's economy, an analysis of trends in corporate liquidations and payments performance, as well as recommendations from D&B's economist team. The report predicts that although recent monthly UK GDP data has significantly reduced the likelihood of the UK having fallen into a recession, forward-looking indicators leave little room for optimism. As such, D&B now forecasts that real UK GDP growth will expand by around 1.0% in 2019, followed by 1.3% in 2020 (assuming a managed exit from the EU). These would be the lowest growth figures since the financial crisis in 2008-09. To download a copy of the report go to https://www.dnb.co.uk/perspectives/finance-credit-risk/uk-quarterly-industry-report.html.
A third of British businesses are concerned about Brexit supply chain impact. According to new research from R3, 11% of UK businesses have reviewed the potential impact of Brexit on their suppliers and customers and are ‘very concerned’ by what they had found. A further 22% were ‘somewhat’ concerned, and 16% of businesses said they had yet to review the potential impact of Brexit on their supplier and customer network. Duncan Swift, R3 President, warned: “Businesses which don’t understand how Brexit will affect their supply chains are at risk of sleepwalking into trouble.” To read R3's news release go to https://www.r3.org.uk/index.cfm?page=1114&element=34002&refpage=1008.
How companies in the UK, France and Germany are preparing for Brexit. HSBC has advised that its latest Navigator report, a survey of more than 9,000 companies around the globe, has found that a comparison of the UK, France and Germany shows that UK businesses are, unsurprisingly, the most prepared for Brexit (83%), with France (79%) and Germany (75%) following behind. HSBC notes that UK companies are focusing on reviewing contracts and checking internal policies and procedures. Meanwhile, the French are mainly opening businesses outside the EU and expanding their supply chains to non-EU markets, whereas the Germans are reviewing contracts and renegotiating terms with suppliers.  For more information go to https://www.business.hsbc.com/navigator.
UK Trade Sectors
UK retailers report record-high stock levels. According to the latest monthly CBI Distributive Trends Survey, against the backdrop of a continuing decline in sales, UK retailers’ stock levels in relation to expected sales were at their highest on record in October. The latest spike in stock adequacy (the highest since the survey began in 1983) followed another large peak seen in August. According to the CBI, a combination of the proximity to Christmas and ongoing Brexit uncertainty is likely to have driven stocks higher, particularly with retailers stocking seasonal products earlier than usual. To read the CBI's news release go to https://www.cbi.org.uk/media-centre/articles/retailers-report-record-high-stock-levels-as-brexit-deadline-looms-cbi/.
UK in-store sales plunge in the final week of October. According to the BDO High Street Sales Tracker (HSST), total like-for-like in-store UK sales only managed a marginal +0.7% increase in October and failed to offset a negative base of -2.0% in October 2018. While the first three weeks of the month saw a boost for in-store like-for-like sales despite poor footfall and challenging weather conditions, the final week saw total in-store like-for-like sales decrease -6.45% from a base of -0.30%. Meanwhile, in contrast, away from the UK high street, non-store like-for-like sales grew by +17.4% from a base of +10.5% last year, suggesting that shoppers still took some advantage of the deeper discounts and earlier seasonal promotions than last year. To read BDO's news release go to https://www.bdo.co.uk/en-gb/news/2019/high-street-to-be-hit-by-perfect-storm-this-christmas.
Amid a gloomy outlook for UK manufacturers, investment plans hit a post-financial crisis low.  According to the CBI’s latest quarterly Industrial Trends Survey, UK manufacturing output continued to fall in the quarter to October, primarily driven by a significant decline in the motor vehicles and transport equipment sub-sector. The survey also showed that prospects for the next quarter are downbeat. Tom Crotty, Group Director of INEOS and Chair of CBI Manufacturing Council, said: “With Brexit reaching a critical crossroads, these gloomy results are unsurprising yet still very concerning. Most tellingly, manufacturers’ investment intentions across buildings, machinery, and skills are at their worst since the dark days of the financial crisis." To read the CBI's news release go to https://www.cbi.org.uk/media-centre/articles/amid-gloomy-outlook-for-manufacturers-investment-plans-hit-post-financial-crisis-low-cbi-industrial-trends/.   
UK Exports
UK exports contracted for the first time in four years in Q3 2019. BDO has reported that its latest Export Growth Index indicates that the UK's EU export growth declined to 93.9 (where 95 shows zero growth ) in Q3 2019. This shows that British exports to Europe contracted year-on-year in Q3 – the first time since 2015. Furthermore, BDO notes that with growth on a downward trajectory across all key UK export markets, a marked recovery in Q4 appears unlikely. Europe’s largest economy, Germany, experienced an even more significant annual contraction of exports in Q3 – with the Index falling by 3.7 points to 90.9. France, Italy and Spain performed better, but also saw growth deteriorate in Q3, with the rate of export growth now below the long-run trend in all three countries.  To read BDO's news release go to https://www.bdo.co.uk/en-gb/news/2019/eu-export-growth-crashes-to-two-year-low.  
The EU as a bloc is the UK’s largest trading partner. According to a new House of Commons Briefing Paper, 'Geographical pattern of UK trade', the EU as a bloc is the UK’s largest trading partner. In 2018, it accounted for 45% (10% less than in 1999) of UK exports of goods and services and 53% of the UK’s imports. However, looking at individual countries, the US is the UK’s largest trading partner, with the UK exporting £121 billion of goods and services to the US in 2018 - 19% of all exports. This was more than double the value of exports to Germany, the UK’s second-largest export market (£56 billion). Overall, in 2018 ten of the UK’s top twenty-five export markets in 2018 were EU member states, as were 12 of the top 25 countries from which the UK imports. To read The House of Commons Briefing Paper go to https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-7593.
Half of EU business leaders expect trade with the UK to decline post-Brexit. New research by BDO has found that half of the EU business leaders it surveyed expect trade with the UK to fall post-Brexit, while 40% of UK business leaders expect a reduction in trade with the EU. The countries anticipating the highest decrease of their country’s trade with the UK include Spain (81%), Denmark (67%) and Italy (53%). However, BDO also notes that the outlook for non-EU markets could be positive, with a quarter of EU businesses and a third of UK businesses expecting Brexit to accelerate their trade with markets outside of the EU. Analysed by individual country, the US is technically the UK’s largest trading partner, accounting for 15% of total goods and services. To read BDO's news release go to https://www.bdo.co.uk/en-gb/news/2019/uk-businesses-confidence-lowest-of-major-eu-economies
UK services businesses plan international push amid UK uncertainty. According to a new Lloyds Bank survey, almost half of UK large services firms are planning an export push over the coming year. The UK Services bosses surveyed say that, in spite of current uncertainty, the EU (44%) continues to offer the most potential, followed by the Far East (32%) and China (31%). Nine in 10 (86%) of those pushing overseas are doing so via mergers or acquisitions, while two in five (38%) expect to remain UK-focused. Although half (48%) say a no-deal Brexit is a risk to growth, most UK services firms are optimistic, with 74% forecasting a rise in their turnover in the next five years. To read Lloyds Bank's news release go to https://www.lloydsbankinggroup.com/Media/Press-Releases/2019-press-releases/lloyds-bank/uk-services-businesses-plan-international-push-amid-uk-uncertainty--lloyds-bank-survey/.
UK Insolvency, Late Payment & Business Distress
489,000 UK businesses are in significant financial distress – a 40% increase since the EU referendum. New research from Begbies Traynor has indicated that the number of UK businesses in significant financial distress has increased by 40% in the three years since the EU referendum, affecting 489,000 UK businesses. Over the past year, significant financial distress has risen in 20 out of the 22 sectors monitored by this research, with the real estate and property, construction, retail and travel sectors the most severely affected. There was also a marked increase in the number of businesses in critical financial distress during the same period – often a precursor to formal insolvency – with a substantial 8% year-on-year rise, To read Begbies Traynor's news release go to https://www.begbies-traynorgroup.com/news/firm-news/489000-businesses-in-significant-financial-distress-a-40-increase-since-the-eu-referendum
UK business insolvencies increased by 1.6% in Q3 compared to a year earlier. Latest data from the Insolvency Service), has indicated that underlying corporate insolvencies rose by 0.4% in Q3 2019 compared to Q2, and rose by 1.6% compared to Q3 2018. In addition, the number of administrations have increased by 20% since the last quarter, and are now at their highest since the first quarter of 2014. Duncan Swift, president of R3, commented: "Uncertainty and stop-start stockpiling are among the factors hitting recruitment, investment, and wider business health, and we’re seeing more businesses worrying about their cashflow levels and their order books over the next quarter and the next year." To read R3's news release go to https://www.r3.org.uk/index.cfm?page=1114&element=34055&refpage=1008.
Twenty more UK businesses are penalised for failing to pay suppliers on time. The Chartered Institute of Credit Management (CICM) has announced that twenty firms – including AstraZeneca, IBM, Diageo, GlaxoSmithKline, Kier and Unilever – have been suspended from the Prompt Payment Code (PPC) for failing to honour the code's commitment to pay 95% of all supplier invoices within sixty days. All of the businesses have already now submitted action plans towards achieving compliance. A further nine businesses – including Interserve Construction, Centrica and Kellogg Brown & Root – have been reinstated to the PPC code having demonstrated compliance for at least the last two consecutive months. Of the thirty-five signatories suspended in April and July, eleven have now been reinstated. To read CICM's news release go to https://www.cicm.com/20-businesses-penalised-failing-pay-suppliers-time/.
Late payments: buyers leave SME suppliers to last. The Fintech Times has reported that new analysis released by Previse shows the extent to which the problem of slow payments is concentrated among small suppliers. Previse has released the findings of an analysis of over 10 million invoices (representing more than £24 billions of spending by some of the UK’s largest buyers). The figures show that, while late payments are rife throughout the supply chain, the smallest suppliers are paid 30 days late while firms charging the biggest fees are paid, on average, less than a day late. Suppliers invoicing for a value less than £10,000 are sometimes not even processed by buyers until 35 days after being received on average, ensuring that payment, usually due within 30 days, is late before the invoice has even been approved. To read The Fintech Times' article go to https://thefintechtimes.com/late-payments/.
The cost of late payment to health and happiness. In its latest report 'Late Payments: The Cost to Business and Our Health,' Hitachi Capital UK has found that 111% of the freelancers it surveyed have been diagnosed with a clinical condition due to clients failing to pay invoices on time. This figure equates to over 200,000 freelance employees in the UK, with the most common conditions anxiety (61%), stress (45%) insomnia (41%) and depression (27%). Overall, two-thirds (65%) of respondents have experienced at least one instance where a client has failed to pay within an agreed payment period. To read Hitachi Capital's news release go to https://www.hitachicapital.co.uk/news-media/late-payments-causing-major-mental-health-issues-among-freelancers/.
Credit Management News and Resources
Paul Uppal is no longer the UK's Small Business Commissioner. A recent UK government news release has reported that Paul Uppal has "stepped down" as Small Business Commissioner. According to The Times, a conflict of interest with the yet-to-operate Business Banking Resolution Service may be behind his departure.  Fiona Dickie, the Deputy Pubs Code Adjudicator, will provide oversight in the Small Business Commissioner role until early November, pending the appointment of an interim Commissioner. An assessment panel of three professionals was used in 2017 to appoint Mr Uppal to the role. To read gov.uk's news release go to https://www.gov.uk/government/news/small-business-commissioner-stands-down.
The Prompt Payment Directory helps suppliers tackle the challenge of late payment. The Prompt Payment Directory is a searchable database for current and historical payment notices all of which are posted and updated by its membership. Users can post payment notices relating to either late or timely payment of invoices. Importantly, users are encouraged to supply the reasons given for invoices that are paid late. The Directory seeks to reveal the context around individual instances of late payment and by doing so enables suppliers to make better informed decisions when considering new contracts and avoid writing off new business opportunities for the wrong reasons. Users are able to anonymously share their insight in return for free access to the Directory. They can also update and remove ratings that they have given. For more information visit www.thepromptpaymentdirectory.co.uk.
Plan ahead to avoid missing important payments in 2020. Bacs has advised that a new free-to-download processing calendar has been published by Pay.UK which outlines all of the UK public holidays throughout next year. The calendar also highlights the dates when Bacs payments should be submitted in order to avoid non-processing days. To download a copy go to https://www.bacs.co.uk/resources/pages/processingcalendar.aspx.
Free UK company information. Companies House has a free search mechanism which enables businesses to obtain free information about a company. This includes: company information, for example: registered address and date of incorporation, current and resigned officers document images, mortgage charge data, previous company names, insolvency information. Users can also set up free email alerts to be notified when a company updates its details (for example, a change of director or address). For more information go to https://beta.companieshouse.gov.uk/?_ga=2.243724357.1196942104.1573411164-730570528.1565358152.
Free trial: Database containing unsecured and unpaid creditors from insolvent UK companies. InfolinkGazette's service offers trade credit insurance brokers, debt collection agencies, asset-based finance, factoring & discounting professionals instant access to an up-to-date database of over 1,000,000 unsecured trade creditors. Unsecured creditor data can be searched by key search parameters, such as size of debt, geographic location or by debtor and/or users can view all the unsecured creditors of a single debtor. Free 30 day trials of the system are currently available at https://www.infolinkgazette.com/?pid=4.
European & World Economy
The World Economy is set to experience its slowest annual growth for a decade. The National Institute of Economic and Social Research (NIESR) has reported that it has lowered its forecast for global GDP growth this year from 3.25% to 3% - the slowest annual growth for a decade. NIESR expects similar growth of 3% in 2020, with a slight pick-up in 2021 to 3.25%. Overall, global GDP growth this year is now expected to be around 0.75% slower than NIESR anticipated a year ago. NIESR notes that the imposition of tariffs by the US on goods from China and other protectionist measures have been a disruptive force in the global trading environment. To read NIESR's news release go to https://www.niesr.ac.uk/media/niesr-press-release-prospects-world-economy-13976.  
The outlook for the world economy indicates a synchronised slowdown and precarious outlook. The IMF has advised that the global economy is in a synchronised slowdown and that it is once again, downgrading its assessment of global growth for 2019 to 3%, its slowest pace since the global financial crisis. The IMF notes that growth continues to be weakened by rising trade barriers and increasing geopolitical tensions and estimates that the US-China trade tensions will cumulatively reduce the level of global GDP by 0.8% by 2020. Looking ahead, the IMF's project a modest improvement in global growth to 3.4% in 2020. However, unlike the synchronised slowdown, the IMF warns that this recovery is not broad-based and remains precarious. To read the IMF's news release go to https://blogs.imf.org/2019/10/15/the-world-economy-synchronized-slowdown-precarious-outlook/.
The European economy is heading towards a protracted period of subdued growth. The European Commission has noted that although the European economy is now in its seventh consecutive year of growth and is forecast to continue expanding in 2020 and 2021, the external environment has become much less supportive and uncertainty is running high. This is particularly affecting the manufacturing sector, which is also experiencing structural shifts. As a result, the European Commission suggests that the European economy looks to be heading towards a protracted period of more subdued growth and muted inflation, with Euro area GDP forecast to expand by 1.1% in 2019 and by 1.2% in 2020 and 2021. Compared to the Summer 2019's predictions, this is a 0.1% downgrade for 2019 and a 0.2% downgrade for 2020. To read the European Commission's news release go to https://ec.europa.eu/commission/presscorner/detail/en/IP_19_6215.
Stable below-trend growth momentum anticipated in the OECD area as a whole. The OECD has reported that its latest composite leading indicators (CLIs) continue to anticipate stable below-trend growth momentum in the OECD area as a whole. Within OECD economies, stable growth momentum remains the assessment for France and Canada and is now also anticipated in Japan and Italy, with similar signs now also emerging in the euro area as a whole. On the other hand, the CLIs for the US and Germany continue to point to easing growth momentum, which is now also the assessment for the UK - although the OECD notes that large margins of error persist due to continuing Brexit uncertainty. Among major emerging economies, the CLIs continue to signal stable growth momentum in China (for the industrial sector) and Brazil and now, also, in Russia. In India, easing growth momentum remains the assessment. To read the OECD's news release go to http://www.oecd.org/newsroom/composite-leading-indicators-cli-oecd-november-2019.htm.
New Zealand continues to top the World Bank's Ease of Doing Business rankings. The World Bank has published the latest annual ease of doing business ranking and has again ranked New Zealand and Singapore in the first and second place. Hong, Kong, Denmark, Korea, the US and Georgia precede the UK (ranked in eighth position) in the top ten. The ten economies where business climates improved the most were Saudi Arabia, Jordan, Togo, Bahrain, Tajikistan, Pakistan, Kuwait, China, India, and Nigeria, the study found. China and Togo appear among the top ten for the second consecutive year, while India makes the list for the third consecutive year. To read the World Bank's news release go to https://www.doingbusiness.org/.
Events & Offers
GTR Africa London 2019, 13 November 2019. London
GTR’s well-known annual African-focused conference, GTR Africa London, will return once again to London this Autumn. It has quickly become a key annual gathering for domestic and international trade, as well as export and project finance professionals focusing on growth and sustainability within Africa.
Over 300 delegates are expected in attendance on November 13, with a dual-stream conference agenda covering a broad range of topics focusing on creating a sustainable vision for the future of African trade. Delegates will explore these topics through multi-format sessions which will include; case studies, interactive panel discussions, break-out sessions, and a new ‘fire-side chat’ format, as well as our famous networking opportunities.
GTR Africa London will look at the pros of ECA’s, supporting infrastructure development and tech innovation and how it can benefit the European region in the global trade race for Africa as well as using the benefits of common European languages in negotiations for a sense of trust through language. The conference will also dive into the risks involved in investing into Africa alongside Chinese and UK government policies while exploring the “in’s and out’s” of the AfCFTA.
As supporting partner, we have secured a limited amount of free Corporate Rate passes to attend the event, normally £849. Corporate Rate passes are only available to those who are exporters, importers, manufactures, distributors, traders & producers of physical goods and are not valid in conjunction with other discounts and available for new registrations only.
To check your eligibility, and to register on a free Corporate Rate pass, please contact Tanya Naysmith at tnaysmith@gtreview.com.
All others, including bankers, insurers, solution providers etc., can receive a special 15% partnership discount when booking online with code: CIN15.
For more information on GTR Africa London 2019, visit 
the event website or download the event brochure.
Alternative & Receivables Finance Forum, 14 November 2019. London
Alternative & Receivables Finance Forum tracks the transformation of receivables and invoice finance; showcasing the most successful new entrants to the market, examining the future of technology-enabled funding models, and driving the conversation on alternative finance for SMEs. This is a unique gathering, where you can network with established receivables finance providers and ‘alternative’ SME funders and find out how the competitive landscape for commercial finance is changing.
The comprehensive programme provides insights into the priorities influencing SMEs’ financial choices and showcases the latest technology-enabled distribution models.
As event partners, Credit Insurance News can offer their members a 10% discount on a delegate pass rate. To register please follow this link https://bcrpub.com/events/alternative-receivables-finance-forum-1. The Credit Insurance News delegate discount code is CIN19 – please utilise the code upon booking. Alternatively you can contact yongmei.he@bcrpub.com quoting your discount code for payment via invoice.
GTR Nordics, 19 November 2019. Stockholm.
GTR Nordics 2019 will return to Stockholm on November 19. 
With an expected attendance of over 450 of the region’s top trade finance experts, insurers, bankers, ECAs, technology innovators, government bodies and corporates of all sizes. 
With the Nordic business community maintaining its position at the forefront of global innovation, 2018’s gathering provided the ideal forum to discuss the latest trends and strategic developments across key trade sectors, and their impact on trade and export financing requirements. 
Insight was provided on the impact of growing global protectionism on trade and the innovative business models developing across key exports sectors, from Volvo’s provision of ‘Equipment as a Service’ to the importance of Turkish EPC contractor Yapi Merkezi’s financial offering when bidding for large infrastructure contracts. 
The digitisation of trade and trade finance was highlighted as a fundamental requirement for future development, posing a challenge to the trade finance market’s incumbents. 
With preparations for the next GTR Nordics event already underway, ensure you join hundreds of your market peers in Stockholm in November 2019 to gain business-critical insight, create crucial contacts and get ahead of the game. 
We have secured a limited amount of free and discounted passes for more information contact bhemmings@gtreview.com or click here.
Trade Credit, Bond, and Political Risk Insurance Dinner, 21 November 2019. The Tower of London. 
Gordon’s Alive! 
Book your tables for the London 2019 Trade Credit, Bond, and Political Risk Insurance Market Dinner and Charity Auction, hosted by Marsh. 
 This year’s event will be held on Thursday 21 November in the spectacular Winter Pavilion at The Tower of London. 
Our master of ceremonies will be actor and adventurer Brian Blessed. Proceeds from the charity auction will go to The British Red Cross. Tables are available seating ten people, and the ticket price includes a sparkling wine reception, a three-course meal, coffee, and petits fours for each guest. House wines, beers, and soft drinks are also included for the duration of the evening. 
TXF Trade Credit and Political Risk Insurance 2019, 4 December 2019. Institute of Directors, London.
The place for banks, corporates and traders to meet the CPRI market and forge new and deeper partnerships for distribution and risk mitigation.
Book your place on 4 December in London for the most interactive private insurance forum around. With insurance and reinsurance brokers as well as underwriters all in attendance alongside CPRI product users, this is the forum for anybody looking to meet the market to explore how to maximally leverage the private insurance product.
Book your place here.
Limited bank, corporate and trader passes available. Please contact tom.pycraft@txfmedia.com to check your eligibility.

Supply Chain Finance Summit, 30-31 January 2020. Amsterdam
The fifth annual Supply Chain Finance Summit is a great opportunity to learn about the latest trends, ideas and developments transforming working capital and supply chain management, as well as a chance to network with leaders in the industry.
This in-depth event tracks the transformation of supply chain finance (SCF); showcasing the latest innovations within the industry for both domestic and cross-border financing, examining the future of technology-enabled supply chain models, and driving the conversation on increasing access of SCF for SMEs and emerging markets.
As event partners, Credit Insurance News can offer their members a 10% discount on a delegate pass rate. To register please follow this link https://bcrpub.com/events/supply-chain-finance-summit-1.
The Credit Insurance News delegate discount code is CIN20– please utilise the code upon booking. Alternatively you can contact yongmei.he@bcrpub.com quoting your discount code for payment via invoice.
About the Sponsor: Chubb
Chubb Global Markets (CGM) is the London Market wholesale and specialty division of Chubb European Group, part of the Chubb Group the world’s largest publicly traded property and casualty insurer. 
CGM has twenty years’ experience in underwriting Excess of Loss trade credit policies, providing non-cancellable cover to companies with well-established credit management procedures, ultimately providing certainty during uncertain political and economic times.
CGM’s trade credit underwriters are experienced in all aspects of the client relationship ensuring a single point of contact and quick decisions. 
Chubb’s core political risk and credit underwriting expertise and their ability to provide bespoke wordings delivers a flexible underwriting approach meeting the changing needs of clients.
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