16/12/2016 BBC Business Live

We start in Japan where Prime Minister Shinzo Abe is hosting

Russian President Vladimir Putin at a summit in Tokyo.

He's the first G7 leader to host Mr Putin since

sanctions were imposed over the Ukraine conflict.

That's not the only reason it's a big deal.

The two countries have never signed a peace treaty formally

ending World War Two because they are still

in dispute over four islands in the Western Pacific,

which Soviet forces occupied at the end of the war.

But the reality is they have a serious business relationship

Trade between Russia and Japan has soared in recent years.

It is now worth more than $33 billion a year.

That's three times what it was ten years ago.

Japan is cash-rich and Russia is desperate for investment,

particularly to its far eastern region.

Russian officials say some 68 deals have already been signed.

There are reports that its huge state gas company Gazprom

is exploring partnerships with Japanese conglomerates

Basically, Japan needs all of its energy brought in.

At the moment it relies on the Arabian Gulf -

but Russia has huge amounts and is on its doorstep.

It also wants help with issues like cyber security.

Chris Weafer is the co-founder of analysts Macro Advisory Partners.

Welcome to the programme. Darren Cave is that background, but in the

headlines we have also heard that Barack Obama, still US president,

has said they will tackle the hacking situation that came from

Russia. We have heard also that EU leaders want to extend sanctions

against Russia for another six months. None of this seems to

concern Shinzo Abe? Know, and it is not concerning investors. The

markets are strongly this year, just this week we heard that German

companies have invested more in Russia this year in the first nine

months than in all of 2015. People are beginning to look beyond the

Obama administration so it will end Obama administration so it will end

in January when Donald Trump comes in with a different agenda, it is

also clear that the EU struggles more and more each meeting to get a

consensus to end sanctions. The view that business and investors take is

that we are nearly at the end, provided nothing bad happens in

2017. As Aaron points out, the

relationship between Russia and Japan makes a lot of sense, Japan is

energy poor and cashrich, Russia has a lot of energy. These energy deals

could be worked through? Both countries were talking about energy

cooperation before sanctions, we are getting back to that agenda again.

They say there is a lot of energy in Russia and it is very close to

Japan. Japan is looking at the fact that its neighbour, South Korea, has

been raising investment quite substantially in Russia and Central

Asia and does not want to lose out. From the Japanese perspective there

is either the issue of China and Chinese dominance affecting Russia,

perhaps they can act as a moderating influence, rather than if it was

entirely sided with China, which is a great fear.

You look at the picture of Russia and President Putin and you go, what

is going on? Cooperation with the Saudis, a deal with Qatar, deals

with Japan, Putin has this... More of a global vision today? We have

seen that evolving, particularly since 2014. President Putin bemoaned

the fact that what he saw was Russia had moved too closely to the west,

it was going to put all its eggs in one basket. In 2014 there was almost

a knee jerk reaction to the China pivot, that has not worked out.

China has not invested much. Since the last year we have seen Russia

adopting globalisation, diversification, trying to do as

many deals as possible for the Kremlin. That is good business and

good politics. I think globalisation will be the way forward.

Looking forward briefly, how does that tell you about trade deals and

how they will go in the future, we are looking at more bilateral

country to country and putting aside these big multi-country deals? The

belt this is a discussion about globalisation -- this is a

discussion about globalisation and there is thought that it is coming

to an end. If the Trump administration follows through, it

will mark the end of the old-style globalisation. Bilateral deals, I

think bartering is as good a word as any. Russia has always been good at

that and that is the intention, we have energy or whatever rocks, in

return we want investment political support. Bilateral deals,

old-fashioned bartering is where we are heading.

Thank you very much for your time this morning. Have a good weekend.

Pressure on Yahoo has continued to grow after the internet company

revealed that it was the victim of another huge hacking attack

in 2013 - in which 1 billion user accounts were accessed.

The hack was done in 2013, that was revealed yesterday, that it was 1

billion people. The company's shares closed down

more than 6% on Wall Street on fears that a planned $4.8 billion sale

to telecoms firm Verizon According to reports in the US,

Verizon is now trying to persuade Yahoo to amend the terms

of the acquisition agreement The Greek parliament has defied

international creditors providing its bailout funds

and voted through a one-off Plans for the 617 million euro

pre-Christmas handout were opposed by European bodies negotiating

Greece's financial lifeline. A deal agreed earlier this month

to provide the next tranche of debt Prime Minister Alexis Tsipras said

Greece would not be blackmailed. US authorities have accused six

pharmaceutical firms from the US, It is alleged the companies

conspired to raise the price of the antibiotic doxycycline

and diabetes drug glyburide. The civil lawsuit has been

filed in 20 US states. It follows criminal charges being

brought against former executives Figures from the US Treasury show

that Japan has overtaken China China has been selling its foreign

currency reserves in a bid to prop John Sudworth is in our Beijing

bureau and can tell us more. Good to see you, happy Friday. Japan

holds more debt, US debt, than any other country in the world?

That's right, it has taken the crown back, if you like, as the biggest

holder of US debt. It is not because of what it has been doing but what

China has been doing, selling off US Treasuries. What China wants at the

moment, basically, is dollar assets to use them to prop up the value of

its currency, which isn't a huge amount of pressure. All of the

debate we heard in the US election cycle about China devaluing its

currency, the truth is that all the action is focused on trying to prop

up the value, because China fears a rapid and uncontrolled devaluation,

and the more likely it looks that US interest rates will rise further,

the more pressure it puts on the Chinese UN and the more that has to

be done to stem the tide of capital rushing for the exit. What does it

mean for the rest of us? Good question. China is burning through

its foreign currency reserves for the same purpose, added some point

China may need to consider either a devaluation or putting in place

stringent capital controls. But, of course, would send a shocking signal

to the rest of the economy and indeed be likely to have an impact

on us all elsewhere in the world. John, I am glad you raise the

question and answer that, because I was opposed to! Bet I was supposed

to. Asian stocks struggled for traction

on Friday as global markets continued adjusting to the idea

of higher US interest rates. Remembering a lot of those emerging

economies are holding US dollar debt and higher interest rates in America

- makes that debt more Europe - pretty much the same story

- still digesting the FED decision and looking to Wall Street -

which I must say had its worst day in two months or put it this way -

four stocks fell for every one that Talking of the US - let's pop over

and see what should be making the biz headlines

today, here's Samira. Investors will be looking for more

fallout from the revelation that Yahoo faced a massive data breach

affecting 1 billion customers. How is the US housing market herring

these days? The commerce Department is expected to say that housing

starts fell in the month of November.

Building permits are expected to slip for the month. With the recent

rise to US interest rates, many will be paying attention to the housing

market and how higher borrowing costs may impact that sector.

Finally, error parts maker Honeywell International is scheduled to

announce its financial expectations for the year 2017 before US markets

opened for trading. Joining us is Jane Foley, Senior

Currency Strategist at Rabobank. Thank you for coming in. We wanted

to start with sterling, it has rallied recently? Looking back to

October, we had a sharp fall in sterling on top of what we had after

the referendum in June, that is because the market was very fearful

of hard Brexit. That just means Brexit without access to the

European single market. Since then, the market has taken a different

tone and has begun to think that there might be access after all,

sterling has a very binary relationship with talk about hard

Brexit, soft Brexit. Since October, sterling has performed better. This

year has been very political, Trump, Brexit, the Italian referendum. What

will the market to be keeping their eye on next year? Politics? Very

much so, Brexiters very much there, in 2017 we will find out how

complicated Brexit will be, then it is elections in Europe. We have seen

in the US and Brexit lots of protest votes, movement towards the far

right and the far left in some countries, the elections next year

we have the Dutch elections in March, the French presidential

election in the spring and the German election. We are likely to

see more votes cast for the far right, but opinion polls right now

suggest they will not be able to form a Government in the Netherlands

and France, certainly not in Germany, so the euro will be there

Eve Pollard tile, it will have a dominating effect on the markets.

The opinion polls say that the far right will not be able to farm --

for those governments. Will be US dollar continue going up? May before

now, but we are a bit sceptical about the revelations so maybe

things will be looking different by the end of next year. We will see

you shortly for a look at the paper. -- papers.

The US central bank raised interest rates this week -

and said more hikes are probably in the works for next year.

We'll chew over that - and the rest of the week's news

with our economics editor Kamal Ahmed.

You're with Business Live from BBC News.

A few months ago, the future of low-cost airline

Then it secured ?165 million of funds from its shareholder,

Greybull Capital and has just updated the City on its profits.

Joining us from the BBC Newsroom is Andrew Swaffield,

Great to have you want the programme. Let's be frank, a hell of

a year for you guys? Slightly relieved with the numbers today? I'm

pleased with a profitable results, ?48 million EBITDA profit in a

difficult year with a combination of terrorism and the collapse in the

value of the pound, as I'm sure your viewers are aware the British

airlines take most of their revenue in pounds and most of our costs go

out in euros and dollars, sue the exchange rate has a big effect. It

has been a challenging year, but pleased to be profitable and looking

forward we see strong bookings, especially for next summer, which we

are encouraged about. On the point of looking forward, you are going to

have new destinations, but I want to talk about a new fleet, a new fuel

efficient fleet you will bring on board, around 2018? Finnair

introduced the Airbus 350 and now saves a million bucks a year on fuel

on that aircraft, you're looking at 18 of those, a savings of 80

million, these new fuel-efficient planes are important? The Boeing 737

Max eight comes in from March 2018 for us, we expect 24% fuel savings

on an annual fuel budget of ?130 million. That is a phenomenal boost

to the bottom line. It is great for the environment as well and these

are much quieter aircraft. They also have a much more customer friendly

interior as well. Very excited. I'm sure the customers will be

excited. Thank you for joining us. Let's see what is going on live

page. Which? Is bringing a super complaint against the banks, to help

people tricked into transferring money into a fraudster's account but

unfortunately it looks like they will not get them to pay the money

back but they want to give them more assistance. OK.

You're watching Business Live - the leaders of Russia and Japan have

agreed more than 60 trade deals as Shinzo Abe becomes the first G7

leader to host Vladimir Putin since sanctions were imposed

on Moscow because of the Ukraine conflict.

A quick look at how markets are faring.

They are still digestive and what we saw on Wednesday, same old story.

American Central bank, the US Fed, been a long time coming, they

pressed the button, the cost of borrowing rose in the world's

biggest economy but the markets are still digestive that. It's one of

the big stories of the week. It is what we are going to talk to Kamal

Ahmed about. He joins us to talk about that story. The US Federal

Reserve have raised interest rates, the UK Central bank held it steady,

why the different approaches? It is about economic performances.

We are seeing macroeconomic trends that will dominate next year, so if

we look at America and why the Fed raised rates after threatening to

four 12 months, the American economy is strengthening, clearly. -- for 12

months. Unemployment is at record lows, some inflation is coming back

into the system and the world is waiting to see what President-elect

Trump will do on the fiscal side with boosting infrastructure

investment. That compares with Europe, Britain and the Eurozone and

the other members of the European Union where growth is still

relatively weak, there are still fears over the trajectory of travel

for the economies in Europe and the European Central Bank still doing

negative interest rates to stimulate the economy monetarily. And then you

have Asia and the problem of capital flows coming out of Asia into the

American markets because there are higher levels of yield so the Asian

currencies are under pressure. America is going in One Direction,

Europe in the middle and Asia on the other side, this big diversion will

be the big macro trend for next year. What does that mean in real

terms, the US powering ahead and we are back here. It is about

investment money. If you imagined a big investment funds which look

where to put the money in the investment in businesses which

create jobs, they are thinking to themselves, where will I get the

best yield and return for my money? America looks more attractive

because of high interest rates meaning you get better returns and

the banks are operating with better profit margins meaning they invest

more into the economy, lend more to businesses and at the same time as

there are still fears about Europe, talking about political risk on the

programme already. In Asia we have the big issue of what is the

relationship between Japan, China and Russia? If America becomes more

in Schiller how will that play out? The Asian economies have these

issues are very connected to America. If capital flows to America

how will the Asian economies perform? We can now talk about EU

sanctions, as we hear they have been extended against Russia for another

six months. Not all EU countries were in favour, they wanted it

easing slightly because of the impact on their economies. Germany

is the country that has the strongest links in trade terms with

Russia, but again this is all about the issue around the pivot and where

does Russia now look to for allies. Of course, in the Middle East and

what is going on in Syria will have some effect about the economic

relationships with the rest of the world. America may now have a more

friendly President in President-elect Trump than it has

had under President Obama. And also, what will the relationship be

between China, Russia and Japan in Asia? And at that stage, the

European Union is worrying, to an extent, given the rise in commodity

prices. Russia still produces a third of commodities exported around

the world. What will Europe's relationship be with Russia if we

have this aggressive sanctions regime at the time Russia is looking

to increase its economic activity with other countries around the

world. I thought we would have 20 seconds, I was going to ask about

the Fox and Sky deal, they tried five years ago and failed. They are

looking for a bigger content platform to take them from Europe,

India and America and bring all of those bits of the business together.

It's part of the picture, we are seeing content providers hooking up

with distributors. Kamal Ahmed, thank you for your time

this morning. Venezuela's most popular

banknote is no longer The 100 Bolivar note is worth

less than two US cents. And the country's economic crisis

has meant extradordinary They will introduce new coins and

banknotes. The International Monetary Fund

estimates that next year's prices And this latest move

is already causing even more Joining us is Jane Foley, Senior

Currency Strategist at Rabobank. We are going to talk through the

papers. Starting with the story we mentioned at the top, these flatpack

apartments, flats being used as one way to tackle the UK's housing

crisis, they are being used around the world and also in the UK. These

are in south London in the picture. I think it looks amazing.

Is about the size of a shipping container, containing a two-bedroom

flat. It says in the article, it had something that cost. So much for the

highlighting! What do you think of these? The cost is 20% cheaper than

a traditional house and this particular product in Luton the

article says will be sold off, so these flats are temporary but the

beauty is they can be taken down and rebuilt somewhere else up to five

times. Just take them off and pop them like Lego. They are timber

framed and I am trying to build a timber framed house myself so I can

confidently say I would live in one of these. They are timber framed and

in the factory big kitchens and washing machines are put into them

and they are dropped in place from the back of a lorry already done.

The lift and stairs must be put in afterwards that they have a fairly

fast completion time. I must say, the reports from the residents here,

people who have been moved into them, are very positive. I think

they are a great solution. If it works.

Given the prices of London property. This report size 120,000 children

homeless at the moment and they also cite that although we are building

more houses we are nowhere near building as many as we need to at

the moment. Let's talk about the big hacking

story. Yahoo, they came out and said they had 1 billion accounts hacked

in 2013, apparently didn't know about it. This is the thing, we

didn't know about it, we knew about a scandal in 2014, 500 million

accounts, and this is something we hadn't heard about and it happened

before and it was 1 billion accounts hacked. Did they really know or not?

They have been negotiating this near $5 billion deal with Verizon, the

former boss walked away with a nice big paycheque. They are talking

about having to walk away from the steel or maybe discount it and the

discount is reported in here today are up to 3 billion, so 3 billion

potential discount on a deal worth 4.8 billion is huge. Verizon's

concern is that Yahoo will lose users and they will lose the

valuable customer base. Yes, this is why they want to buy Yahoo to rival

the likes of Facebook and Google. They want consumers' information to

help them with advertising. That is what they want and if consumers walk

away there is nothing there for them. Grace Dove, Jane. Merry

Christmas, have a wonderful time off. That's it. You are off for

Christmas as well. I am, so lucky. That is it for

today. More business news on Monday. Hi, it has been a cloudy week and

today will be a cloudy day again. Weather front across western areas,

you can see on the satellite picture coming across the Atlantic and

stalling and becoming slow-moving. This streak of cloud is a front