07/09/2016 BBC Business Live


07/09/2016

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This is Business Live from BBC News with Ben Thompson and Sally Bundock.

:00:00.:00:10.

London retains its top spot as the best place

:00:11.:00:17.

in the world to do business, but New York slumps to sixth place.

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Live from London, that's our top story on Wednesday, 7th September.

:00:21.:00:39.

Holding onto their crown a post-Brexit world.

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London takes the top spot as the world's best city,

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but how much longer can it expect to be top dog?

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Also in the programme - the wonder Down Under.

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The Australian economy has now been growing continuously for 25 years.

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The European trading day has been going for half an hour. The price of

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oil is up by over 1%. We will talk you through the winners and the

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losers. Voyage SNCF sells tens of millions

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of train tickets across the region. And we speak to the head

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of a business that has been keeping Europe's tourism industry on track

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during a turbulent year. Voyage SNCF sells tens of millions

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of train tickets across the region. Their boss will be

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with us a little later. And, as Apple prepare

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to unveil its new devices, rumours are rife that it's ditching

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the headphone jack on its iPhone. So we want to know -

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good move or bad? Where's the best

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place to do business? It's a question every major boss

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faces as they look to expand The financial services giant PwC has

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today published its list of the top spots around the world to live,

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work and do business. Well, for the second time in a row,

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London has taken the crown as a result of its strong

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intellectual capital, sense of innovation

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and technological readiness. That will, of course, reassure many

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in the city, as the UK looks It's not all good news

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for the UK capital though, as the report also warns that Brexit

:02:32.:02:35.

could affect the movement of talent into the city as well as London's

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ability to encourage So watch this space as far as London

:02:39.:02:41.

is concerned. The city-state Singapore

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takes the second spot, and was particularly praised

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for its transportation systems, infrastructure

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and the ease of doing business. The big faller in the list

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is New York which has gone from first place in 2012

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to sixth place now. The city performed poorly

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on sustainability and cost, but still comes second

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when measuring economic clout. He's a partner at

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PricewaterhouseCoopers. David good morning. Welcome. Talk us

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through some of this because what struck me is there are so many

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things that you look at when you're assessing which cities are in the

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league table and it is some unusual things, things we might not take

:03:32.:03:35.

into account? Yeah, I mean the things that you would expect like

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economic clout, ease of doing business, transportation, but we

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wanted to cover a broader range of measures which include things like

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you know cultural vibrancy, preparedness for natural disasters.

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You know, all the sorts of things that affect living and working in a

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city. We're looking here at pictures of London that's retained the top

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spot. Tell me what London is doing right. It scores really highly on

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things you might expect, economic clout, the number of global

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headquarters that are located in London. Ease of doing business. The

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ease of which you can set-up a business, recruit people, employ

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people, and those sorts of things it scores really well. It scores things

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well with cultural vibrancy. There is a tremendous history to the city.

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London holding on to the top spot, but a lot of other cities snapping

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at its heels particularly in the wake of Brexit perhaps trying to

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steal a lead on financial services, but there is no evidence that's

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happening yet? The survey was done prior to Brexit, but if you were to

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do it now, there would no change so far. Four of the top ten are

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European cities. And changes ahead with Brexit. It is too early to say

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what. But I think the thing for me is London is proven to be a very

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adaptable city. It is a very agile city. One we expect to be high is

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New York, falling into sixth place. So I suppose the reverse is true.

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You've touched on what London is doing well. What's New York not

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doing well? It suffers from cost of living issues. There is a lot of

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competition within this across the broader measures and whilst New York

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continues to score well with traditional things, it doesn't do

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well with cost of living and sustainability, those things. I

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suppose ultimately, businesses that are looking around the world and

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where to locate will be weighing up the things you've talked about. What

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can cities do to try and attract more business? They need to consider

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the broader measures and not focus on the financials. People want to

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experience good living within a city and I think it is important that

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cities look across all the sorts of broad measures we cover in this

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report. David, thank you. In other news, Australia's Trade

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Minister says it will be at least 2.5 years before his country can

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arrange a new trade He said Australia would negotiate

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with the EU before starting formal talks with Britain,

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and they could begin only once Swiss Banking Group,

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UBS, says up to 1,500 of its jobs in London may

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be moved abroad once the UK leaves The bank has previously said that

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a "significant percentage" of its London workforce would be

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moved if Brexit became a reality. The bank employs around 5,000 staff

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at its offices in London. French car-maker, Renault, may stop

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offering diesel engines in most The move is a reaction

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to the cost of ensuring that diesel engines comply

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with tighter emissions regulations. Last year saw a huge diesel

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emissions scandal involving German Renault's move was reported

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by Reuters and has not yet been The Business Live page dominated by

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one story. It is Sports Direct. It is under fire for its treatment of

:07:14.:07:18.

its staff. Some conditions have been described as a Victorian workhouse

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because they weren't paying staff according to more traditional

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contracts, it is their annual general meeting today. The boss is

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expected to come under fire. Lots of details about what might happen. The

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chairman offering his resignation but it was not accepted by the board

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of directors at Sports Director, Mike Ashley is the controversial

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figure that's been in the papers a lot, Mike Ashley. He told the BBC he

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plans to keep the company publicly listed. So lots of different bits of

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information coming in ahead of that AGM that's later on today. Yesterday

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they said they would offer their retail staff, those in stores, fixed

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hours contracts rather than the zero-hours contracts. So perhaps

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pre-empting the criticism that they are likely to face later.

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Australia has managed 25 years of continuous GDP growth.

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That's despite the slowdown in China.

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Phil explain this. 25 years of consecutive growth. It is a good

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figure to have, how have they done it? Well, it is a great result, 3.3%

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Australia's annual GDP growth, that's more than double the United

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States managed to garner during that period. And to explain this, you

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have to look at Australia's response to a fading mining boom. For the

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last decade-and-a-half, Australia has relied on exports of natural

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resources, most notably iron ore and coal to places such as China and

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India for its economic growth. That natural resource is fading and when

:09:05.:09:08.

you drill into the latest GDP figures this shows that Government

:09:09.:09:12.

investment and spending on infrastructure projects such as

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roads and other transport links are really propping up the economy. They

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economists are saying in Australia economists are saying in Australia

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that without that public spending Australia's growth would be a lot

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weaker. So ministers in Australia say these are very, very good

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results, but they do acknowledge that there are challenges ahead. You

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have to remember too that interest rates in Australia are at a record

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low. So that shows that the reserve bank wants to inject more money into

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the economy because it has worries about certain sectors of Australia's

:09:47.:09:50.

economic performance. So the headline result is very, very good

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for Australia. No recession since for Australia. No recession since

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the early 1990s and of course, the Australian Government is crossing

:09:58.:10:01.

its fingers that this miraculous economic run continues. All right,

:10:02.:10:05.

we'll watch this space. For now, Phil, thank you very much indeed.

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Phil Mercer. The Australian dollar weakening today. That's after a

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five-day run of a 2.4% gain. A weakening in the Australian dollar

:10:17.:10:19.

in reaction to that growth number that came through.

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Japan, its five day of run of gains came to a halt today. The Bank of

:10:29.:10:34.

Japan is not going to be initiating more stimulus measures there in the

:10:35.:10:37.

near future. That hit sentiment in Japan. Across Asia we saw slight

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falls, that's the night before in the United States. Let's look at

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what's going on in the UK. Among the events happening today, we have got

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slight losses on markets in Europe. Nothing too dramatic, but Mark

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Carney, the governor of the Bank of England, will be before committee

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later. That will be interesting. He will be getting a grilling about the

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Bank of England's recent action post the Brexit referendum. So a lot to

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go on in Europe. We will talk about that in detail.

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Here's Samira with what to watch on Wall Street today.

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It's holding its annual media event in San Francisco,

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where it's expected to unveil the new iPhone7.

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Now, these days the big challenge for Apple is to bring some growth

:11:29.:11:31.

The economic slowdown has pretty much slammed the brakes

:11:32.:11:34.

on what was once seen as Apple's next big market.

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Separately, PlayStation will be holding its own

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Now, think of the PlayStation as Sony's most important

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The Japanese company will likely be announcing

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a higher-end PlayStation 4, better equipped to handle VR,

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And it is also expected to show a slimmer, less expensive version

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of the PS4 that people have in their living rooms right now.

:11:59.:12:09.

Richard Hunter, head of research at Wilson King Investment Management.

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Richard nice to see you. As Sally touched on in the markets, it is all

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about central banks? Yes, apart from what we heard about with Japan, we

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have the ECB meeting later in the week as well and perhaps more

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pertinently in terms of the Bank of England, there is Mark Carney's

:12:35.:12:37.

potential grilling this afternoon as well. Is there an issue with Mark

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Carney? There is a lot of economic data that suggests that things are

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better than they might have forecast, he is perhaps willing some

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bad data to come through, they have cut interest rates and they have

:12:52.:12:54.

launched a stimulus, they may have launched a stimulus, they may have

:12:55.:12:56.

done that too soon? It is a good point. The excuse after Brexit is we

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have only had two weeks worth of data so they left it a month. Even

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then we have only had six weeks worth of data and the subsequent

:13:06.:13:08.

economic numbers that have come through, you could probably make an

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argument that there wasn't a need for an interest rate cut for further

:13:13.:13:16.

monetary easing as we saw. On the other hand, I suspect the reply from

:13:17.:13:22.

the bank will simply be that one of the central banks duties is to be

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ahead of the curve and to anticipate what we're coming into as opposed to

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what we might see. Richard, thank you. Nice to see you.

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The inside track on keeping things on track!

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The boss of French rail giant Voyages SNCF will be

:13:42.:13:44.

here to tell us how me navigates not one train network,

:13:45.:13:46.

but lots of them, right across Europe.

:13:47.:13:49.

You're with Business Live from BBC News.

:13:50.:14:00.

Sports Direct is in the spotlight again today at their

:14:01.:14:02.

Annual General Meeting, when bosses are expected

:14:03.:14:06.

to come under fire over how it treats its workers.

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It pre-empted the criticism yesterday, announcing that it

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would offer store staff fixed-hour contracts rather than the

:14:16.:14:17.

So what are we expecting from today's AGM?

:14:18.:14:20.

Theo Leggett is in our Business Newsroom.

:14:21.:14:25.

Talk us through what we are expecting today and we've had some

:14:26.:14:33.

movement? Let me take you to the share price of Sports Direct. This

:14:34.:14:38.

is between yesterday's close and where the share price is today.

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Steep fall this morning. More than 7%. Now the reason for that is that

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Sports Direct has said that its earnings next year are likely to be

:14:48.:14:52.

around the ?300 million mark as opposed to ?380 million which the

:14:53.:14:56.

markets were expecting and which is the figure we have seen for

:14:57.:14:59.

2015/2016. That's something else that Mike Ashley and his fellow

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directors will be grilled about at the meeting later on today. But it

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is about more than just the profit forecast. It is also about corporate

:15:08.:15:12.

governance. A number of institutional shareholders are

:15:13.:15:15.

unhappy with what has been going on at Sports Direct. There has been a

:15:16.:15:19.

major scandal over conditions at its warehouse in Derbyshire. 4,000

:15:20.:15:23.

people work there. There have been allegations of bullying, allegations

:15:24.:15:26.

of abuse in the way that the six strikes and you're out system is

:15:27.:15:31.

used for discipline so if people spent too long going to the toilet

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or took too many water breaks, they could be fired. Yesterday, we had a

:15:35.:15:41.

report from Sports Direct admitting to serious shortcomings in the way

:15:42.:15:46.

it treated its staff. Mike Ashley has said that's unsuitable and there

:15:47.:15:50.

have been promises that things will get better. Workers at the company's

:15:51.:15:56.

stores will be able to opt-out of zero-hours contracts and gain

:15:57.:15:59.

guaranteed 12 hours minimum hours a work. That said there will be a lot

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of pressure from shareholders at meeting today and a lot of that is

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likely to fall on the head of the chairman. There will be a vote to

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try to oust himment Thank you.

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We will keep you across that. You can refer to our page, which is

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across the story. The AGM gets under way, and it will update all the

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time. Check it out online.

:16:29.:16:33.

London has been crowned as the world's top city

:16:34.:16:38.

of opportunity for the second year in a row, but faces major

:16:39.:16:41.

challenges from the Brexit vote, according to a a report by financial

:16:42.:16:45.

Singapore and Toronto make up the rest of the top three,

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while New York slips from second place to sixth.

:16:53.:17:02.

We should do a survey among the BBC correspondents. We know who is

:17:03.:17:08.

where, but what they think! A quick look at how

:17:09.:17:10.

markets are faring. Europe is quite mixed, very flat, to

:17:11.:17:16.

be honest. The price of oil is up again.

:17:17.:17:34.

Keep your comments in about what Apple might announce this week. We

:17:35.:17:41.

will talk about it later. Running a railway is

:17:42.:17:44.

notoriously difficult. Not least here in the UK,

:17:45.:17:45.

where train services are heavily subsidised,

:17:46.:17:48.

but still criticised for late running, overcrowding

:17:49.:17:54.

and expensive tickets. So imagine trying to run a business

:17:55.:17:59.

that brings together lots of train Voyages SNCF is a subsidiary

:18:00.:18:02.

of the French national railway firm SNCF, and sells railway tickets

:18:03.:18:12.

to destinations all over Europe. It is a key player in the tourism

:18:13.:18:19.

industry, employing up to 1,000 Last year, the group sold 83 million

:18:20.:18:22.

tickets from around 15 European rail operators, with revenues of more

:18:23.:18:30.

than four billion euros. And now, new technology means that

:18:31.:18:35.

passengers can change their journey, adapting to delays and changes

:18:36.:18:38.

across different countries To make it clear, you have brought

:18:39.:19:03.

in this beautiful train to illustrate what we are talking

:19:04.:19:09.

about, but your company is just about ticketing, so when it comes to

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the trains, how they operate, but they are on time or not, that is not

:19:16.:19:22.

to do with you. , business is the digital selling of rail, we are the

:19:23.:19:26.

leader in Europe in selling rail on the web. I should talk about mobile

:19:27.:19:38.

and tablets, since this business is shifting that way, have to buy it at

:19:39.:19:48.

which Price, 60% purchase on smartphones. My business is to have

:19:49.:20:02.

these beautiful trains, it is growing fast, since it is much

:20:03.:20:06.

easier, with these new tools. Talk us through the logistics. Even in

:20:07.:20:12.

one country, such as the UK, it means the different companies have

:20:13.:20:15.

to speak to each other to share the cost and to take a train from, say,

:20:16.:20:23.

London to Scotland, you might have to use different operators, so how

:20:24.:20:26.

do you get everybody talking to each other? We need to bundle the

:20:27.:20:32.

different operators' tickets to show the easiest way to go. As a

:20:33.:20:40.

distributor, we are the ones making the travel easy. You don't need to

:20:41.:20:45.

see which company you will take, you just need to say, I want to go from

:20:46.:20:55.

there to there. I want to get it easy, the cheap price, and we will

:20:56.:21:00.

sell it to you, to make you happy. We are the happy travel factory,

:21:01.:21:05.

this is what we succeed in doing. We sell a million tickets each year in

:21:06.:21:09.

the UK, 80 million tickets are around the world, and we are present

:21:10.:21:14.

in more than 100 countries, through technology, through the knowledge of

:21:15.:21:18.

the customer, and through the knowledge of why a customer will

:21:19.:21:25.

take this train. For leisure, for the purpose of discovering new

:21:26.:21:32.

landscapes, new cultures. How has your business been affected by what

:21:33.:21:35.

has been going on in France? The majority of your business is there,

:21:36.:21:40.

people passing through into the rest of Europe, or just around France.

:21:41.:21:45.

With all of the offence going on, Euro 2016, lots of terrorist

:21:46.:21:51.

attacks, that have hit key areas that are very popular with tourists,

:21:52.:21:55.

those travelling by train, talk us through that. We had two different

:21:56.:22:02.

events, the positive one, the European Championships, was a great

:22:03.:22:08.

success. For each match we had sold 20% of the capacity of the stadium

:22:09.:22:13.

through our system, so that is great. After, there were sad events.

:22:14.:22:23.

But overall, we have to cope with that and show what the situation is

:22:24.:22:29.

in France. We lodged a campaign where we can see tourists in Paris

:22:30.:22:35.

visiting and living a good experience. Did you see a fall in

:22:36.:22:44.

sales? There was a small fall since the attacks, but when we showed how

:22:45.:22:51.

the situation is, people understand that and they are keen on travelling

:22:52.:22:57.

again with us. It is nice to see you, thank you for coming in, and

:22:58.:23:01.

thank you for bringing the train we play with it later!

:23:02.:23:11.

The business life page is where you can stay ahead, with all of the

:23:12.:23:17.

day's breaking news. We will keep you up-to-date with the latest

:23:18.:23:22.

details, with insight and analysis from the BBC's team of editors

:23:23.:23:24.

around the world. We want to hear from you. It involved on the web

:23:25.:23:34.

page. We are on Twitter, and you can find us on Facebook. On TV and

:23:35.:23:45.

online, whenever you need to know. Do get in touch. You have got in

:23:46.:23:50.

touch about Apple's new iPhone this week, rumours suggest they will lose

:23:51.:23:57.

the headphones jack. Let's get to some of the tweets. Then says, if it

:23:58.:24:04.

makes the phone better, I am for it. Somebody is says, I love the

:24:05.:24:08.

headphones I have, the Apple I is rubbish in comparison. There is a

:24:09.:24:12.

suggestion you might have to purchase different headphones. There

:24:13.:24:17.

was says, nothing wrong with the humble jack plug, just a chance to

:24:18.:24:22.

corner the market again. It is not good for musicians either. Maria

:24:23.:24:29.

says, it might make me leave Apple. Richard, do you care? I imagine a

:24:30.:24:36.

lot of people don't. I have not got an iPhone. They have got a bit of

:24:37.:24:42.

previous on things like this. In terms of changing the hardware to

:24:43.:24:47.

the cost of the consumer. I suspect there will be a bit of feedback and

:24:48.:24:53.

social media. People have been talking about this for months, the

:24:54.:24:58.

fact that the jack will be changed. For those who have bought fancy

:24:59.:25:03.

headphones, it is a nightmare. It would mean the phone can be

:25:04.:25:06.

thinner and they can put in a better battery. That is what people moan

:25:07.:25:11.

about. So it is a trade-off. What if you have a wireless headset, you

:25:12.:25:18.

will not be affected. Amazon's new 30 hour working week, they say it is

:25:19.:25:23.

a great idea. They are trying to improve productivity. One of the

:25:24.:25:29.

week economic feeds in the state is not so much an implement, it is

:25:30.:25:33.

productivity, so you will get a 30 hour working week and 75% of your

:25:34.:25:38.

salary, and certain pockets of the workforce... You are just going

:25:39.:25:45.

part-time. It is not a new idea. It should also free up the ability to

:25:46.:25:49.

bring more people in. You are a Londoner, we can tell by your

:25:50.:25:54.

accent, the top spot, according to the PWC. The surprising thing was

:25:55.:26:01.

New York going down to sixth place. Thank you for your company, we will

:26:02.:26:04.

see you soon, goodbye.

:26:05.:26:09.

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