29/06/2016 BBC Business Live

This is Business Live from BBC News with Ben Thompson

Out in the cold - European leaders meet

in Brussels to discuss the UK's role outside the EU

but without David Cameron.Live from London, that's our top story

It could be his final trip to Brussels, but David Cameron says

freedom of movement is a central part of being in the single market.

We will assess the new relationship as the EU prepares for divorce!

Also today, telecoms giant Vodafone considers moving its London

headquarters away from the UK, warning that access

Markets are up sharply after a bumper session yesterday too. So

have the fears really gone away? Or is it just a temporary reprieve?

And we continue our special series speaking to the businesses preparing

But what impact will Britain's exit from the EU mean

The boss of Italian coffee giant Lavazza will be here.

And we'll assess how the world's press are covering the fallout

of Brexit including this story a new dating app that aims

to connect people who share the same view on Britain voting to leave!

The British Prime Minister left out in the cold.

European leaders are meeting today in Brussels without David Cameron.

The leaders of the remaining 27 member states will have informal

discussions over the implications of the UK's vote to leave.

Last night Mr Cameron gave what was probably his last press

conference in Brussels, and outlined some of

The European Union sees the single market as capital, goods and people

and these things go together. And indeed, the European Union sees that

the structural fund payments that are made through the European Union

are again, part of the single market. I think sometimes in Britain

we think of these things as separate options. Very much the sense here is

these things all go together and that if you want the full benefits

of the single market then you need to be involved in every part of it.

Now, that's obviously going to be a huge challenge to try and get that

right for the future. As I said, a challenge for Europe. A challenge

for Britain. Meanwhile German Chancellor,

Angela Merkel, said there would be no negotiations based

on cherry-picking Now yesterday, we discussed

the implications for Germany and its role in shaping

any future trade deal. Remember, the UK is Germany's third

biggest export market. It will be a key player

in any negotiations and compared with Germany it has

a lot less to lose if It exported fewer goods to the UK

last year - $35-billion worth Britain's vote has also given

a boost to far-right parties including France's National Front

which are now demanding their own The National Front's president,

Marine Le Pen, said the UK vote And on economic policy,

France is often seen as an advocate for protectionist measures,

not least the common agricultural policy which provides

billions of dollars Anne-Sylvaine Chassany

is the Paris Bureau Chief Ann thank you for taking time out to

be on Business Live. Just talk us through how Francois Hollande will

try and get his influence in the negotiations. What is France hoping

for, trying to get out of this divorce? Well, I think first of all,

the economic impact on France will be moderate. I think that's the

consensus here. Economists estimate that a UK recession could hurt the

economy by 0.2% or 0.4% on the GDP. So it is modest. It will be

negative, but modest. The political impact will be probably bigger on

French politics. As you mentioned the impact on Marie Le Pen and what

she is going to do in the next presidential elections And that's

next year, it is not far away at all and we are aware of the difficulty

Francois Hollande has got in terms of his popularity, but trying to

push through labour reform, many changes in policy that are not going

down well in France at all. Yes, but in a way, he sees this as an

opportunity, I saw him last night at the EU Summit, he sees an

opportunity to show French voters who are sceptical about the EU and

the euro that leaving the European Union as Marie Le Pen is pushing for

would have disastrous effect on the economy, on you know, on the people

itself when you see, you know, young people, you know, rebelling against

their parents or complaining about an exit. It doesn't look good, it

doesn't help Marie Le Pen down the line and he sees that opportunity to

settle the question of the EU once, you know, for good during the

presidential elections despite, as you said, his abysmal approval

ratings. As you say, the economic impact is expected to be marginal,

but from some points of view, France can benefit. Many are arguing that

investment bankers could be headed to Paris to relocate because of

course, London will no longer be able to work effectively in some

areas of business? Yes, Francois Hollande mentioned that last night

saying that the City of London will now be able to do the clearing, the

euro trade clearing and it is a pretty big activity for the City of

London. So he also, you know, sees an opportunity, an economic

opportunity to strengthen Paris as a financial centre. Obviously, you

know. He is going to have competition with, you know,

Frankfurt and Dublin, but indeed, he is really trying to capture that

part of that fall-out. I'm sure he is.

Thank you so much. The Paris bureau chief at the Financial Times.

Vodafone has warned it could move its headquarters from the UK,

depending on Britain's negotiations to leave the European Union.

In a statement, the telecoms giant says it's important to retain access

to the EU's free "movement of people, capital and goods"

but warned it was too early to "draw any firm conclusions

China's first home-grown airliner has landed in Shanghai

The Comac plane has been in development since 2002

and is China's attempt to break into the aircraft market dominated

China is likely to become one of the world's biggest aircraft

Sally, I'm glad we didn't put the full name in there. The full name

was in an hour or two ago and I stumbled on it! More information on

Vodafone, I'm failing to find more information. That is a big, big

story in the UK. There are more details on the home business page

for the BBC site, on the Business Live page we have got other stories

including how markets in Asia fared today. There is another big story

breaking in Asia today. Now on to Asia, one of the world's

largest car manufacturers, Toyota is recalling 482,000 hybrid

Prius and Lexus cars because of a possible

airbag inflator defect. Explain this recall. It seems we've

talked a lot about it, airbags, recalls, car makers, explain the

latest one? Well, Toyota is recalling more than four million

cars this time. Over two separate flaws. The first has to do with

leaking fuel tanks and the second has to do with airbags that may

crack and injury the car occupants. The airbags involve inflators in

cars which have been parked and unoccupied for a period of time it

is the Prius and Carolla. Toyota didn't specify as well who made the

defective parts of the car, but they said they are not from Dakar ta.

They are the ones responsible for the car industry's biggest ever

recall following multiple deaths and injuries with deadly airbags.

Thank you very much. And frankly

Take a look at the markets at yesterday's close and this

morning's open and you'd think there wasn't a lot going on.

Even, something to get excited about.

There was a strong rebound yesterday helped by the reassessment

that the risks might not be as bad as many had feared.

No immediate rush to trigger that Article 50 that would kick-start

So that could mean that, in the short-term at

That said, longer-term, there's still a huge

But it does mean markets have a bit more time to assess

what's actually going on, rather than the knee-jerk volatility

The FTSE up 1.5%. In the longer term there are still risks.

We will assess that in more detail in a moment.

We'll assess that more in a moment, but here's Michelle with a look

There are a couple of big names reporting earnings. Month Santa

turns in its third quarter results later this Wednesday. For

shareholders, the focus will be on a German take-over which it turned

down last month. If any deal went ahead, it would be the third seed

and chemical industry merger this year. Changing consumer habits are

expected to dent profits at General Mills. Healthier eating habits are

expected to have hit sales at the maker of cheer yos cereal and

Yoplait yoghurt. And encouraging economic news boosted US financial

markets on Tuesday. This Wednesday, watch out for May's pending home

sales and consumer spending data. Global Market Strategist

at JP Morgan Asset Management. Before we talk about the States,

give us your take on this, up and up and up. It is good to see a bit of

green on the screens after the past few days have been very bad for

markets. I would say this is probably not a big sign of massive

rebound. The Brexit uncertainties will still remain, we have been

seeing through the news things keep developing politically and

economically in term of trade negotiations and how it all works,

it is good to see a bit of recovery after the bad Friday and Monday, but

I wouldn't say we're out of the woods yet. That's Europe. Let's look

at the US because we're looking at the global implications of this and

one thing that may or may not be related, let's talk about US

interest rates, we get excite about what the Fed thinks? It is tough for

the Fed because they are supposed to look at the US economy in term of

employment and inflation and those two aspects are doing well for the

US, it is the big global concerns, a massive amount of volatility and

markets selling off which makes the Fed pause for breath. We have seen

actually in the past few days interest rate expectations for the

Fed to start hiking rates be pushed back further and further. Now, they

are all data dependant, they will be looking at the world to see if

they're ready, but in time we have to see what Janet Yellen and her

team think. For now, thank you. She will be back soon to talk

through the papers. Still to come, wake up

and smell the coffee. As Britain and Europe adjusts

to idea of life outside of Europe, the boss of Italian coffee giant

Lavazza will be here to discuss the implications for business,

exports and our love of coffee. You're with Business

Live from BBC News. Before the referendum,

we heard that the price of electrical goods would go up

if we voted to leave the EU. That's what the boss of electrical

and mobile phone retailer Well, what does he

think after the vote? Sebastian James, the Chief Executive

of Dixons Carphone has been speaking Well, it is very hard to say, it is

obviously early days and my view is I think pretty straightforward,

which is we need to be grown-ups and we need to carry on. I think in the

last five days, we haven't seen any material change in the way customers

are behaving. So no decline in spend on the weekend? No, so far we are

up, soap so far so good and in our view it is very important that we do

everything we can to remain in the market and service customer survey

continue to buy for us. And opening new stores, life goes on?

Absolutely, we have huge plans ahead and we have just come out of the

year where we reported 17% earnings growth, record profitability and we

are an incredibly strong placed on which to build. Whatever the market

throws at us, we have an incredibly good track record in the market of

weathering storm is coming out of them stronger. So no change to your

investment plans? We have to keep an eye on what is going on in the world

but at the moment, absolutely no plans to change anything we are

doing. We have lots of investment here and in the US and in

continental Europe and we will continue to do those things. We have

seen when the markets fell, a rush to safe havens like the yen, you

import from Japan... Alice is different, it is different to other

industries, televisions that cost ?1000 less year can cost you ?,500

this year. It is emerging all the time. I don't know if it will feel

different, because we can't compare with what it would be like if Brexit

hadn't happened and my job is to work with suppliers and all of our

stores and pay costs as tight as we can so we continue to give the best

deals to our customers. That was the boss of Dixons Carphone

speaking to our business editor. I promised more information on

Vodafone on the website, then it is, read all about it.

Our top story today, European leaders are meeting in Brussels.

They are discussing the implications of a UK

outside of the EU, but without

The relief rally on financial markets continues today, this is how

Europe is trading right now. How long will it last? We will be across

every twist and turn. We've heard from British

businesses about how leaving the EU could impact them -

but what would happen Lavazza is Italy's best

selling coffee brand. It was established in 1895

in the city of Turin, and it has been owned by the same

family for four generations. It's the world's sixth biggest

coffee roaster by sales and has operations in more than 90

countries around the world. Last year, it had

a turnover of $1.6 billion. It is a brand that many know very

well indeed. Giuseppe Lavazza, the vice chair

of Lavazza Group, joins us now. He said that beautifully. Bidder

Sally get that right? Yes, very well, perfect.

We must talk to initially about the situation with regard to the UK's

decision. The UK market is very important to your company, isn't it?

Absolutely, one of the most important countries and we

established our subsidiary a long time ago. I personally established

it in 1990 and it is one of the top markets for Lavazza. So what does it

mean for your business? In the short term, we have to try and mitigate

the impact, for example the immolation of the pound, but in the

long term, the Lavazza company is very committed to carrying out

business as usual, of course, investing in the country, the

relationship with the British market is very strong, we are investing in

a lot of big brands in the UK, the product is very successful. We want

to grow much more in the UK and of course, we are launching new

products, so the plan has a different scenario and we have do

try to adapt as usual. What do you think about day-to-day? We talk

about big issues and there are still a lot of unknowns and uncertainty in

the long term but what you do on a practical level? Are there things

you can do to mitigate this? First of all, we have to implement our

contingency plan to mitigate the event of the devaluation of the

pound, because it will have an impact. So we have to risk protect

the initiative and keep the business sustainable long-term and keep

continuing to invest. So we need the reserves. It is a family business,

we are not listed, we have do use our own resources. So we have to do

that first. Secondly, we have to follow very carefully the

development of the negotiation between the UK and Europe Anne Fine

if there is some potential risk in the trading relationship -- and

five. For the food and wine industry, Italian and UK, is a very

important market. It is about 2.8 billion of exports in 2015 and the

potential cost of this renegotiation for our system could be around 3

billion euros. Is one strength for you the fact that you are so

diversify as a company in terms of weight you export to and who drinks

your copy? The US is a very important market, France, Germany,

Italy is of course your key market but interestingly, China doesn't

feature at all. Apparently they haven't got a taste for coffee. You

are right. The big issue for a company like Lavazza which is very

linked to copy is to try and adapt the copy to the local needs --

Coffey. More and more, you need a more personal individual kind of

product for different consumers. So Asia is very different from Europe

and the US, because the taste is different. We have an operation for

example in India, that we started in 2007 and the coffee over their is

not so strong, not growing quite a lot, but China is a different

scenario, you need a very specific product to be successful there and a

good route market. There is talk briefly about you, the fourth

generation to lead this company. Was there pressure on you to do this or

has it been your lifelong love? No pressure, it is an absolute free

choice. This was not the same story for the second generation, the third

generation, they were forced to join a company. For me, it was different.

I had a different attitude. I wanted to help my father in the business,

to have a try and after two or three years, I totally fell in love with

the company, with the coffee, with the business, so I decided to say.

What is your favourite drink? The short espresso. Will you come back,

we have run out of time? Absolutely. Thank you so much for coming in. So

much more to discuss, but we have to move on.

We do and we will stay with that theme.

The UK's vote to leave the EU has been greeted with shock by many

Some warn the UK's departure could lead

to the disintegration of the EU itself.

Others have seen it as a signal that far-reaching reforms

He's the former chief economist of the European Central Bank

and seen by some as one of the architects of the Euro itself.

and seen by some as one of the architects of the euro itself.

He spoke to our colleague, Theo Leggett.

I think the idea of a two speed Europe never died

and the UK was always, let's say, half in and half out

in the past and this cream skimming has some attractiveness.

So against this background, I really don't understand why the UK

has not gone the way to exploit this situation to their advantage.

But they are thinking, I think, this is needed,

but it would be more than a nightmare, a catastrophe,

if this would be the start of the collapse of

Very interesting to get his take on what is going on at the moment.

Let's have a look at the papers. Lots of good stories about the

implications of the Brexit Road. Let's talk about what we stalked

Mike Berry about at the start is -- talked about at the start of the

programme. Backdating app, it is about sharing that feeling of loss

and bringing like-minded people together. The Brexit debate, whether

you were on either side, in the canteen, the pub, on the chut, it

has sparked a lot of vibrant discussion and so to have people

feeling the same way about things are connecting people... I think

this is just an excuse to launch another dating app.

Maybe it is an integral thing, your political views will dictate your

choice of partner. I wonder if people who voted differently in

couples, it could be interesting... That is a whole debate. Families

have been on polar opposite sides of this debate and the divisions it has

created, people would never have assumed before and that is

interesting. Can we move on? Let's talk about

Rolls-Royce. Familiar territory to me. Let's talk about the

implications, this article in the Telegraph. It is a bit of a balance

for companies like Rolls-Royce, when you have slower global growth and

slower UK economy at the Brexit and thinking about that a man feel

product going down, it is a challenge for profits. Then you have

the pound which has fallen ten plus percent in the last few days, making

what you are selling to the rest of the world as much more competitive

and when you translated back into pounds in the UK, you have a pretty

good profit situation. The article does point out a couple of

challenges and a couple of benefits of Brexit and says Rolls-Royce might

be obeyed. Challenges the you add JP Morgan? -- might be OK. Every day,

we monitor and we have very intelligent management teams figured

out the next state of play. It has been good having you, Nandini. It

really is that issue for businesses around the world to assess what it

means for them, what their plans next and how they can deal with

them. In the short term, we have seen markets rising pretty sharply,

the FTSE still up in early trading. We are back this time tomorrow,

thank you for being with us today and we will see you then.