19/12/2016 BBC Business Live


19/12/2016

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

:00:00.:00:09.

Panic buying and looting in Venezuela as the currency

:00:10.:00:11.

Live from London, that's our top story on Monday, 19th December.

:00:12.:00:31.

Venezuela's President Nicolas Maduro has been forced to delay

:00:32.:00:34.

the withdrawal of the country's most widely used banknote

:00:35.:00:36.

Also in the programme, can the EU strike a trade deal

:00:37.:00:44.

with Japan amid fears of growing protectionism?

:00:45.:00:55.

The market for looking like this. The Santa rally isn't happening.

:00:56.:00:59.

More details later. And as Christmas fast approaches

:01:00.:01:01.

we'll be getting the inside track Our very own Santa's little helper

:01:02.:01:04.

is somewhere in London. Guess where I am. I am at the

:01:05.:01:17.

world's oldest toy shop, Hamleys in London. Christmas is days away and

:01:18.:01:21.

Father Christmas is pretty busy. Are you excited for Father Christmas?

:01:22.:01:29.

Yes. We will be taking a look at this near $90 billion global

:01:30.:01:32.

industry. And the question today, what was your favourite Christmas

:01:33.:01:37.

toy? You know what to do, use the hashtag, hello, elves! Hello!

:01:38.:01:49.

I wonder if Hamleys know what they have let themselves in for. More

:01:50.:01:56.

later. And keep your comments coming in on what your favourite toy was.

:01:57.:01:58.

Troops are patrolling cities where looting and protests have

:01:59.:02:07.

erupted over the government's plan to withdraw the country's

:02:08.:02:09.

largest denomination bank note from circulation.

:02:10.:02:12.

A partial curfew is in place in the southern city

:02:13.:02:16.

of Ciudad Bolivar, which has been most affected by the disturbances.

:02:17.:02:22.

President Nicolas Maduro says more than 300

:02:23.:02:29.

He has now postponed the withdrawal of the 100 bolivar

:02:30.:02:32.

note until January and, seeking to calm nerves,

:02:33.:02:34.

has said a first batch of replacement notes had arrived

:02:35.:02:36.

So how did the country get to this state?

:02:37.:02:42.

Venezuela's economy has been struggling for a long time now.

:02:43.:02:44.

By the end of this year it will be producing more than 20% less good

:02:45.:02:48.

One of the driving factors is the reliance on oil.

:02:49.:02:56.

The black stuff accounts for 96% of exports but even before

:02:57.:02:59.

the price collapse of the last two years the economy was shrinking.

:03:00.:03:04.

That along with the way the government has managed

:03:05.:03:07.

the economy with price and currency controls mean the International

:03:08.:03:12.

Monetary Fund is predicting inflation of nearly 500%

:03:13.:03:14.

And that's why the 100 Bolivar note which was supposed to have been

:03:15.:03:19.

withdrawn on Friday is worth less than 2 US cents.

:03:20.:03:27.

It was the most common banknote accounting for almost 48%

:03:28.:03:29.

Diego Zuluaga from the UK based think-tank the Institute

:03:30.:03:32.

-- as Ben outlined there, this is just the tip of the iceberg in

:03:33.:03:52.

Venezuela, isn't it? But was it actually a good idea to get bigger

:03:53.:03:56.

denominated notes on stream, but it has just been purely executed --

:03:57.:04:05.

poorly executed? You have inflation, so you need to change the

:04:06.:04:09.

denomination. The 100 Bolivar was becoming useless. It is 50% of the

:04:10.:04:16.

money in circulation in Venezuela. And most people rely on cash to make

:04:17.:04:20.

bank accounts. It isn't poorly bank accounts. It isn't poorly

:04:21.:04:24.

executed, it is just the wrong way to approach the problem. If

:04:25.:04:31.

something isn't done zero 's will just keep being added to the

:04:32.:04:36.

currency. Interesting to hear the government's reason for doing this.

:04:37.:04:41.

They were trying to stop money-laundering and gang activity.

:04:42.:04:46.

Many were bemused by that. It is an issue of scapegoating. It is about

:04:47.:04:52.

finding the external enemy. Colombia has been blamed many times for

:04:53.:04:57.

holding the currency abroad. But if people are hoarding currency, taking

:04:58.:05:02.

even more out of it does not seem to be a remedy. How is the economy

:05:03.:05:06.

fairy, how are people getting along, because there was a lot of

:05:07.:05:10.

discontent about the current government? Talk us through what is

:05:11.:05:14.

going on and what might happen in the New Year. The economy of

:05:15.:05:18.

Venezuela has been in chaos. Increasing chaos for the better part

:05:19.:05:22.

of the past two years. The decline in the oil price, its main export,

:05:23.:05:27.

has compounded problems. Venezuelan need something like $150 per barrel

:05:28.:05:36.

to meet the market price. There is escalating unrest. Supplies are

:05:37.:05:40.

short. There are no medical supplies. The productivity of the

:05:41.:05:44.

economy has stalled. That is a result of the mismanagement which

:05:45.:05:46.

has been taking place for the past two years. When do you think we

:05:47.:05:53.

might see some political change? The main issue is economic change. The

:05:54.:05:57.

government to change direction completely. Removing price controls.

:05:58.:06:04.

And stop harassing private activity, which is at the heart of this...

:06:05.:06:08.

Will we see that before political change? It is difficult to tell. The

:06:09.:06:14.

government is set in its ways. It has established a network of favour

:06:15.:06:18.

granting to particular groups in society. It's difficult to reverse.

:06:19.:06:23.

The heart of the problem is economic and it is a direct consequence.

:06:24.:06:27.

Unless that changes, problems will only escalate, and things will only

:06:28.:06:30.

get worse on a political plane, as well. Thank you. Interesting

:06:31.:06:34.

scenario and a difficult one, as scenario and a difficult one, as

:06:35.:06:37.

well, we shall keep across it at the BBC.

:06:38.:06:39.

Talks aimed at averting a strike by cabin crew at British Airways

:06:40.:06:43.

Members of the Unite union are due to walk out on Christmas Day

:06:44.:06:48.

and Boxing Day in a row over pay and conditions.

:06:49.:06:51.

The industrial action, if it goes ahead, could

:06:52.:06:53.

Apple plans to appeal against the European Commission's

:06:54.:07:01.

ruling that it pays up to E13 billion to

:07:02.:07:03.

EU regulators ruled Apple's controversial tax deal was illegal,

:07:04.:07:06.

Ireland is also contesting the decision, claiming EU

:07:07.:07:11.

regulators were interfering with national sovereignty.

:07:12.:07:16.

Rogue One: A Star Wars Story has taken nearly $291 million around

:07:17.:07:19.

North America accounted for about half of the total

:07:20.:07:26.

for the Star Wars spin-off - making $155 million.

:07:27.:07:30.

That gave the film the second-best December opening weekend on record

:07:31.:07:33.

Will you go and see it? No, I have heard mixed reviews, I

:07:34.:07:49.

might just wait... I am pretty sure I will be going,

:07:50.:07:52.

because I have three young boys. Yeah, you don't have a choice.

:07:53.:07:54.

Finance leaders from Japan and the EU want to reach

:07:55.:07:57.

an agreement on a free-trade pact this week.

:07:58.:07:59.

It comes at an uncertain time for international trade,

:08:00.:08:01.

as US President-elect Donald Trump speaks of protectionism

:08:02.:08:03.

and the UK's decision to split from the European Union Mariko Oi

:08:04.:08:06.

Bring us up to date. It's a fascinating issue because of all of

:08:07.:08:21.

those things we've heard elsewhere. Trump, Brexit, really weighing on

:08:22.:08:27.

all of this. That's right. Just as we thought free trade deals are

:08:28.:08:31.

totally out of fashion, Asian countries have been pursuing their

:08:32.:08:35.

own deals. If you remember recently it ratified their partnership, which

:08:36.:08:41.

includes 12 countries, including the United States. -- especially Japan.

:08:42.:08:50.

Trump said he would kill the deal on his first day in office. Canada and

:08:51.:08:57.

the EU have been trying to reach an agreement. There has been talk on

:08:58.:09:01.

the Tokyo side, whether there will be political pressure, just like the

:09:02.:09:05.

EU Canada deal faced, but it seems that they are getting close to an

:09:06.:09:10.

agreement. And that is a big thing over here in Asia. Thanks very much.

:09:11.:09:17.

We will check with Singapore as we approach Christmas. I would like to

:09:18.:09:20.

stay in Asia... Nintendo tumbled 7%

:09:21.:09:21.

with investors underwhelmed Its new game Super Mario Run

:09:22.:09:23.

received tepid reviews, a far cry from the global phenomenon

:09:24.:09:26.

that was Pokemon Go Shares also hit by profit taking

:09:27.:09:29.

and a stronger yen on concerns about China-US tensions

:09:30.:09:35.

after Beijing seized a US Navy drone in international waters

:09:36.:09:37.

in the South China Sea. In Europe, as we head

:09:38.:09:43.

into the Christmas week, you'd think it might be quiet,

:09:44.:09:48.

but amid industrial relations disputes and the threat of strikes

:09:49.:09:53.

it's going to be anything but quiet. Joining us is Jeremy Cook,

:09:54.:10:02.

Chief Economist at World First. Nice to see you. Then there's

:10:03.:10:28.

touching on what is going on in a brand-new trading week. BP doing

:10:29.:10:38.

well. Its shares our up half a percent, doing deals with Abu Dhabi.

:10:39.:10:44.

It is no coincidence after those deals that we will see more

:10:45.:10:47.

investment in the oil market and oil sector by big players, for example

:10:48.:10:52.

BP. They've taken a 10% share in the Abu Dhabi all company. -- oil. This

:10:53.:10:59.

will add access to the Emirates oilfields. It is a pretty shrewd

:11:00.:11:03.

manoeuvre. And Abu Dhabi get 80% stake in BP. Around 2.2. They are

:11:04.:11:09.

still wheeling and dealing even though we are heading towards the

:11:10.:11:12.

Christmas week which tends to be quiet. It does tend to be quiet. But

:11:13.:11:16.

the long-term scenarios for oil suggests prices will pick up. BB

:11:17.:11:21.

stand to benefit from that. Oil is a low marginal cost per barrel at the

:11:22.:11:27.

moment. No Santa rally yet. A couple of days still to go. -- BP stand to

:11:28.:11:33.

benefit. The US have had an amazing run. You

:11:34.:11:40.

sound disappointed. Everybody is still talking about Dow Jones. The

:11:41.:11:47.

FTSE did well on Friday. Yes, and it is a continue of the stimulus from

:11:48.:11:56.

the Trump administration. There has been activity over bonds. That will

:11:57.:11:59.

continue into the New Year until the 20th of January when the presidency

:12:00.:12:02.

of Donald Trump actually starts. And we find out if everything he said on

:12:03.:12:08.

the campaign trail was true. How quickly does that translate? Will

:12:09.:12:14.

the markets do something as soon as he is inaugurated? He said he would

:12:15.:12:19.

do something with China on his first day in office. We will find out

:12:20.:12:23.

whether he is actually going to start playing hardball with China.

:12:24.:12:28.

We were talking about the EU Japan trade. The protectionism, the rising

:12:29.:12:33.

protectionism of the presidency, in a post Brexit environment. These

:12:34.:12:37.

trade deals which people are not really talking about at the moment

:12:38.:12:40.

between some of the largest economies out there will keep things

:12:41.:12:43.

going. What was your favourite Christmas toy? Are used to like

:12:44.:12:50.

getting a new mountain bike -- I used. We always able to go out for a

:12:51.:12:56.

bike ride before coming back for some turkey. Good stuff. Thanks very

:12:57.:12:57.

much. Happy Christmas. You, too. Still to come, Aaron's making

:12:58.:13:03.

himself useful for once I am bringing this back, Pride In

:13:04.:13:23.

The Face for you. -- Pie. We are having a look at Hamleys. We're

:13:24.:13:31.

going to talk about the Christmas trade and find out about their

:13:32.:13:34.

expansion plans in, where else, China!

:13:35.:13:37.

Thousands of Post Office workers are beginning strike action today.

:13:38.:13:42.

The walkout by the Communication Workers Union is the latest move

:13:43.:13:45.

in a dispute over pension changes, job security and closures.

:13:46.:13:47.

Industrial action this week will also affect airports

:13:48.:13:49.

and Southern Rail services as Keith Doyle reports.

:13:50.:13:58.

This last week before Christmas is already busy and stressful.

:13:59.:14:04.

But strikes and industrial action could make it a Christmas

:14:05.:14:06.

On the trains, Southern Rail passengers face more disruption

:14:07.:14:12.

as 400 conductors strike today and tomorrow.

:14:13.:14:16.

It's not expected to cause the same level of disruption as last

:14:17.:14:19.

week's strikes by drivers, however many routes

:14:20.:14:21.

3,500 workers at Crown Post Offices are starting a five-day strike today

:14:22.:14:28.

in a despute over jobs and pensions that may see the closure of larger

:14:29.:14:32.

high street branches, although the Post Office says

:14:33.:14:34.

disruption to the public should be minimal.

:14:35.:14:38.

Airline travellers face double trouble this week as baggage

:14:39.:14:40.

handlers working for Swissport are set to strike on

:14:41.:14:42.

This will mainly affect regional airports.

:14:43.:14:48.

But a strike by 4,500 British Airways cabin crew over pay

:14:49.:14:50.

could also see flights disrupted on Christmas Day and Boxing Day.

:14:51.:14:59.

There are efforts being made to resolve these disputes.

:15:00.:15:02.

BA management and the union Unite will meet today and a meeting

:15:03.:15:06.

tomorrow to resolve the baggage handlers' dispute is due to be held

:15:07.:15:09.

but the Post Office strike is on and there seems little

:15:10.:15:11.

prospect of an early end to the long-running dispute

:15:12.:15:13.

between the RMT union and Southern Rail, meaning 300,000

:15:14.:15:16.

If you are affected by the disruption, keep across the Business

:15:17.:15:38.

Live page. This is the latest on Southern Rail for example.

:15:39.:15:41.

Discussing what's going on there. There is more about what is

:15:42.:15:46.

happening with postmen as well. Who is affected and where? Keep across

:15:47.:15:51.

our Business Live page as we keep you up-to-date with the waves of

:15:52.:15:53.

strikes that are happening across the country.

:15:54.:15:58.

Full details on the website, of course:

:15:59.:16:10.

Our top story, Venezuela's President Nicolas Maduro has been forced

:16:11.:16:16.

to delay the withdrawal of the country's most

:16:17.:16:18.

widely used banknote following a period of public unrest.

:16:19.:16:27.

Rampant inflation means that the Venezuelan 100 bolivar note

:16:28.:16:29.

It is a really tricky situation there.

:16:30.:16:42.

Let's get the Inside Track on a busy period for the toy industry.

:16:43.:16:46.

With Christmas less than a week a way, it's a critical time

:16:47.:16:49.

for the likes of Mattel, Lego and Hasbro.

:16:50.:16:54.

Hundreds of others hoping their toy will be top of the present

:16:55.:16:58.

wish-list. Aaron Heslehurst is at London's

:16:59.:17:02.

world famous toy story Hamleys. What have you found there? Are they

:17:03.:17:13.

for Sally? Ah. Yeah, they're for Sally or they could be for you Ben

:17:14.:17:17.

if you want them. I'm like a kid in a candy shop. I have only been here

:17:18.:17:21.

for 40 minutes and I don't know where to begin. This is the world's

:17:22.:17:26.

oldest toy shop, it is called Hamleys. It was started by William

:17:27.:17:33.

Hamley in 1760. He opened a toy shop in hold burn. You guys said it, it

:17:34.:17:39.

is an important period of time. For all these toy makers, a third of

:17:40.:17:43.

their annual sales are attributed to this Christmas period. It is

:17:44.:17:46.

important they get it right and it seems like things are going well

:17:47.:17:50.

because continued growth around the globe for the toy makers, it

:17:51.:17:53.

continues to grow around the 7% mark. We have got a few of the hot

:17:54.:18:04.

picks. This is the Hatchimals. This is the only one they have. I'm going

:18:05.:18:13.

to try and nick it! No, not really. Lego, big Barbie dolls since they

:18:14.:18:19.

introduced the different ethnicities to reflect our modern life. I'm

:18:20.:18:26.

joined by the CEO of Hamleys. The doors are not open yet. Let's talk

:18:27.:18:31.

Christmas trade. You opened the 100th store? We did. How is

:18:32.:18:35.

Christmas trade going? Pretty positive. Down to three factors.

:18:36.:18:43.

Firstly, we have seen an increase to our store in Regent Street. In the

:18:44.:18:47.

last six months we have doubled the size of our UK portfolio and we are

:18:48.:18:51.

bringing Hamleys to 12 locations throughout the UK. As you referred

:18:52.:18:55.

to, last Thursday, we opened our 100th store in the largest shopping

:18:56.:19:01.

mall in South Africa and our international portfolio continues to

:19:02.:19:04.

trade strongly. I was looking briefly, I was looking at the

:19:05.:19:07.

numbers here, you get five million people a year through the doors here

:19:08.:19:10.

at your flagship store? More than that. Well, I was looking at the

:19:11.:19:18.

tourist numbers, port Rica gets 3.5 million, you get more visitors that

:19:19.:19:22.

countries get tourists. Indeed. I have got to talk to you about

:19:23.:19:27.

Brexit. It continues to be a hot topic. The pound has dropped. It is

:19:28.:19:33.

more expensive for you to buy your goods in? We saw foot fall growth.

:19:34.:19:40.

Wur shoppers are getting a better return against sterling. However,

:19:41.:19:43.

our job is simple. Every customer that visits our store, it is an

:19:44.:19:49.

experience, the magical theatre and ambiance that Hamleys has to bring.

:19:50.:19:58.

We are talking about this Hatchimal. I think it costs about 60 bucks. On

:19:59.:20:06.

eBay, what was it on eBay $800 on eBay! I want to talk about the

:20:07.:20:09.

internet and Amazon. I know it is about the experience. But the likes

:20:10.:20:13.

of online shopping, that's got to give you a hit here and there? Well,

:20:14.:20:19.

to some extent it does, but we don't directly compete with the internet

:20:20.:20:22.

because the internet can't compete with our service proposition.

:20:23.:20:26.

Hamleys is about building experiences, energy, excitement,

:20:27.:20:28.

theatre, demonstrations and interaction with customers and

:20:29.:20:31.

really bringing products to life. The internet cannot compete with

:20:32.:20:36.

that. And can't compete with that, indeed, I was here a couple of years

:20:37.:20:40.

looking at the big Christmas spend and the hot toys and since then

:20:41.:20:44.

you're owned by the Chinese now. China is your market. One of our

:20:45.:20:48.

markets. We operate in 26 different countries and China is a very

:20:49.:20:53.

important market for us. You say one of them, but don't, Hamleys has

:20:54.:20:59.

plans to open, you tell me. Well, since we have been acquired by the

:21:00.:21:07.

Chinese, we opened our first Hamleys store in China. We have two centres

:21:08.:21:13.

toe open in China and we have identified an additional 50 Chinese

:21:14.:21:16.

stores which will open in the next two to three years. Wow. We

:21:17.:21:21.

appreciate your time. Good luck with the rest of the Christmas period. It

:21:22.:21:25.

will be manic today? It is. It is the second busiest trading day of

:21:26.:21:28.

the year. That's what you have sent me down to, the second busiest

:21:29.:21:33.

trading day of the year! Some of the hot toys. I mentioned Lego. Lego

:21:34.:21:39.

continues to be a phenomena, it is one of the biggest, most profitable

:21:40.:21:45.

toy companies in the world. A stark cry from a decade ago when Lego

:21:46.:21:53.

nearly went bust! Barbie has been reinvigorated. She was a doll that

:21:54.:21:59.

was dying, let's be frank until they introduced 23 different ethnicities

:22:00.:22:03.

and the different sizes, double digit sales for the Barbie dolls and

:22:04.:22:14.

the big Nerf gun, I'ming to bring that back! I'm going to take you on!

:22:15.:22:21.

Bring two back. We could have such a good fight with that! That would be

:22:22.:22:28.

the best stress relief ever. We could sell tickets!

:22:29.:22:33.

I don't know how it works. Next time I talk to you I will have sussed

:22:34.:22:37.

that out, OK? I'm sure you could figure it out! See you later.

:22:38.:22:42.

He is having a great time there. Whenever I go there with my

:22:43.:22:47.

children, you cannot move. You get dragged in every direction. And

:22:48.:22:52.

you're trying to watch them so they don't get lost. Heather says a real

:22:53.:22:59.

typewriter when she was 13. Mum refused to buy a toy one. Very

:23:00.:23:08.

useful. That's why you work in tax. Neil Death Star, heavy duty

:23:09.:23:13.

cardboard, it is still in the loft. Morgan says my favourite toy is

:23:14.:23:17.

Lego. Getting more this year! Good stuff. Thank you for your messages.

:23:18.:23:23.

My son gave me his third revision of his list for Santa last night and he

:23:24.:23:28.

expects it to get there in time. You better get it sent. Put it on

:23:29.:23:34.

e-mail. You can send them by e-mail to the North Pole. I will tweet it.

:23:35.:23:36.

If Donald Trump can do it, so can I. The BBC's Dominic

:23:37.:23:40.

O'Connell is with us. Your favourite toy? Lego. A command

:23:41.:23:56.

shuttle. I was a seven-year-old. It is not what I want, it is what they

:23:57.:24:01.

want. Were you into Lego when you were a little boy? Lego was out of

:24:02.:24:05.

fashion when I was growing up. It was boring things like bicycles and

:24:06.:24:09.

stuff like that, but these days, it is all digital, but you still can't

:24:10.:24:20.

to Santa Claus. Financial Times talking digital and Apple, Dublin

:24:21.:24:23.

claims Brussels exceeded powers over Apple tax. We were waiting for

:24:24.:24:28.

there, weren't we? It dates back to August when Europe said that Apple

:24:29.:24:32.

hadn't paid 13 billion euros in taxes and it should pay up. Ireland

:24:33.:24:35.

said this morning it has given the reasons for the legal reasons for

:24:36.:24:39.

its appeal. It says basically that to Brussels it said that Irish tax

:24:40.:24:44.

rulings are none of your business and it says that no Irish tax law

:24:45.:24:48.

was ignored when they toct decisions and also that sovereignty is

:24:49.:24:52.

national, ie, it is Dublin that make the decisions, not Brussels.

:24:53.:24:56.

We expect an appeal from Apple later today. Apple will say the same

:24:57.:25:00.

things with a twist. It will say that tax should be paid in America,

:25:01.:25:08.

not in Ireland. It is holding $2 billion off-shore. It says it will

:25:09.:25:12.

take the money back on shore. It hasn't done so, but it will pay it

:25:13.:25:15.

and pay it in America and not in Europe.

:25:16.:25:19.

Let's turn our attention to food. If you are not looking forward to the

:25:20.:25:32.

turkey and the trimmings, how about take-away, Deliveroo are doing very

:25:33.:25:37.

well. Now we're going to have dark kitchens. Deliveroo are going to

:25:38.:25:47.

build kitchens which restaurants can use. Good stuff. Thank you too for

:25:48.:25:54.

your tweets today. It is very interesting to hear what people got

:25:55.:25:57.

at Christmas, isn't it? See you tomorrow. Same place, bye-bye.

:25:58.:26:07.

We're starting this week off on a quiet settled note thanks to high

:26:08.:26:14.

pressure, but midweek

:26:15.:26:15.

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