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A perfect storm

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is fast approaching this spring when unwinding currency hedges will leave retailers exposed to a steep jump in dollar import costs. At the same time, quarterly rent bills will land, the national living wage and apprentice levy will kick in, and retailers will face a jump in business rates in April. Mary Portas, retail guru and former adviser to the Government, told The Sunday Telegraph she believed that the business rates system was the most catastrophic element the retail industry faced and would mean the loss of shops. High street retailers will collectively have to fork out an additional 125m over the next five years to cover the hike in business rates, according to business rates specialists CVS. In exclusive analysis for The Sunday Telegraph, CVS found that small shops will see their bills rise by 1.6bn, with the smallest shops having to fork out an extra 3,663 in rates over the next five years. Meanwhile, Asos, Amazon and Boohoo will receive a further tailwind as rates bills on their distribution centres come down, exacerbating the gap between struggling high street retailers and their fast-growing online rivals. Asos is benefiting from the shift online from stores The shift to online retail is continuing at an unrelenting pace, to the cost of high street stores, said Sanjay Bailur, managing director at consultants Alix Partners. Just having strong online operations will no longer be enough. Retailers are having to make their shops work better if they are to continue to chew up profits in the form of rents and rates. And as inflation and a weaker pound take their toll, the traditional chains are being forced to evolve more and more quickly as spending threatens to weaken. Sir Charlie Mayfield, chairman of the John Lewis Partnership , said emphatically: Sterling is a dog that hasnt barked yet. The multibillion-dollar question is what happens next and how much is passed on to the customer. Quite a lot will be absorbed by retailers. Primark has

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committed to taking a hit on profit margins in order to keep

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its prices low, while Next has warned that prices will rise by as much as 5pc. Primark has committed to not pass on the costs from a weaker pound With a variety of pressures looming, it will get harder to justify having a plethora of stores. Marks & Spencer has announced 30 shop closures. Meanwhile, other retailers are exploring new ways to lure shoppers back to their stores by adding services such as cafes. Nexts Lord Wolfson has frequently complained about the shift from retail spending to leisure and entertainment, and now retailers are attempting to corner that market too. Increasingly, department stores such as House of Fraser and Debenhams are ramping up investment in their beauty halls , adding services such as brow grooming and blowdry salons.

For the original version including any supplementary images or video, visit http://www.telegraph.co.uk/business/2017/01/14/high-streets-festive-sparkle-gives-way-darker-days/amp/

The Palestinian leader held a private meeting with Pope Francis before inaugurating the diplomatic mission, located in a building facing the Vatican that also houses the embassies of Peru and Burkina Faso. Speaking briefly to reporters, Abbas reiterated his opposition to the possible transfer of the US embassy from Tel Aviv to Jerusalem as President-elect Donald Trump had indicated he might do. "We cannot say anything yet because it has not happened, but if this does happen it will not help the peace process. I hope it will not happen," said Abbas, speaking in Arabic. In a separate English-language statement, he hailed the Vatican's hosting of a Palestinian embassy. "We are very grateful about the role that the Holy See has played for a just and lasting peace in the Holy Land, and for having opened an embassy of Palestine in the Vatican for first time," he said. But Abbas expressed concern about Trump's pledge during the election campaign to recognise Jerusalem as the capital of Israel and move the American embassy there. - 'Fuel extremism' - Such a step would be a historic break with US policy, and with most of the international community, over the status of Jerusalem, also claimed by the Palestinians as capital of their future state, an issue to be settled by negotiation. "Any attempts at legitimising the illegal Israeli annexation of the city will destroy the prospects of any political process, bury the hopes for a two-state solution, and fuel extremism in our region, as well as worldwide," Abbas said.