16/08/2011 World Business Report


16/08/2011

Similar Content

Browse content similar to 16/08/2011. Check below for episodes and series from the same categories and more!

Transcript


LineFromTo

Now for the latest financial news, with Tania Beckett, and World

:00:03.:00:13.

Business Report. Hello, welcome to World Business

:00:13.:00:16.

Report. Hear are the headlines - fears that

:00:17.:00:24.

the engine of Europe's growth is slowing. German GDP numbers are

:00:24.:00:26.

dropping. Making the eurozone work. France

:00:26.:00:31.

and Germany need to look at the solutions to the region's debt

:00:31.:00:36.

crisis. Rico Hizon in Australia. Qantas is set to overhaul its

:00:36.:00:46.
:00:46.:00:46.

international operations, with 1,000 jobs at risk.

:00:46.:00:51.

Hello, there. More evidence will emerge today about the scale of the

:00:51.:00:54.

economic slowdown in Europe. Germany and Spain are both expected

:00:55.:00:58.

to announce that growth during the second quarter was down on the

:00:58.:01:02.

previous three months. Analysts will be particularly

:01:02.:01:05.

worried about Germany's performance, as much as Europe has been relying

:01:05.:01:09.

on the strength of its economy. They are predicting German growth

:01:09.:01:14.

will be down from 1.5% to just half a percent. Healthy German exports

:01:14.:01:18.

have not only been driving its own economy but powering what little

:01:18.:01:21.

growth there has been throughout the rest of Europe too. But

:01:21.:01:26.

worldwide demand is not what it was, so the German growth story may be

:01:26.:01:31.

changing direction and losing If we have a firm strong euro as

:01:31.:01:37.

well, which is not helping matters at all. When demand slows and the

:01:37.:01:41.

exchange rate remains fairly uncompetitive, that is also going

:01:41.:01:45.

to take the edge off industrial sector demand.

:01:45.:01:49.

Even before today, the Spanish economy was already weak, with

:01:49.:01:52.

little sign that the country's massive unemployment problem is

:01:52.:01:56.

going to improve. The start of the year, many Spaniards kept spending

:01:56.:02:00.

but that can't continue. Many analysts fear the weakness of

:02:00.:02:04.

Spain's export industries could lead it into a second recession,

:02:04.:02:09.

which will make it harder to reduce its debt. Even if it doesn't fall

:02:09.:02:13.

back into recession, it will not see the strong growth that the

:02:13.:02:16.

Government is banking on, which means it will struggle to bring its

:02:16.:02:22.

budget deficit down and calm the market fears. Last week, France,

:02:22.:02:26.

the eurozone's second largest economy, announce growth for the

:02:26.:02:28.

second quarter. But the real shadow hanging over Europe is a

:02:28.:02:31.

possibility of another recession in the United States in which case

:02:31.:02:39.

today's figures have plenty of scope to get worse.

:02:39.:02:43.

German Government is posing a big increase in the centralisation of

:02:43.:02:50.

economic policy across the eurozone. The countrys Finance Minister and

:02:50.:02:54.

vice Chancellor told the BBC there should be a central authority to

:02:54.:02:58.

oversee the economies of member countries.

:02:58.:03:06.

If one member state failed these tests we need to - we need a maybe

:03:06.:03:10.

special institution which has the possibility to make some kind of

:03:10.:03:14.

assumptions to the member states. You are talking about a central

:03:14.:03:21.

government, really, so what kind of powers would it have? My idea of a

:03:21.:03:29.

stability council is not to have a permanent government on economic

:03:29.:03:33.

issues. I think it is only in the situation of a crisis, if a member

:03:33.:03:40.

state is in difficulties because of failing these tests for

:03:40.:03:48.

competitiveness. So - but you are right, you need some instruments to

:03:48.:03:53.

help the member states in difficulties. Maybe you can help to

:03:53.:03:58.

set special rules for the economy or the labour market or so on.

:03:58.:04:02.

German taxpayers have accepted bailout 1, bailout 2. Will they

:04:02.:04:08.

accept bailout 3, 4, 5 - who knows how many? I think the people were

:04:08.:04:16.

asked what do you do in the long term? Will you have a security

:04:16.:04:24.

package, 3, 4, 5, 6 or 7, or will you change the structures in the

:04:24.:04:27.

eurozone in the direction to more stability? I think if they see that

:04:27.:04:35.

we will go to more stability in the eurozone, they will accept our

:04:35.:04:38.

short-term activities, because they see the long-term activities are

:04:38.:04:42.

very good, very good for the eurozone, for Europe and the people

:04:42.:04:48.

in Germany as well. Sus well. Very sure. Will the euro exist in

:04:48.:04:54.

five years' time? Its present form? We will have the euro, stay with

:04:54.:05:01.

the euro, yes and we have to implement the special rules so that

:05:01.:05:10.

we can be sure that we have the union.

:05:10.:05:16.

Well, the French President Nicolas Sarkozy and the German Chancellor

:05:16.:05:19.

Angela Merkel meet in Paris later today to disday to diso make the

:05:19.:05:25.

eurozone work more effectively. Germany's crossed speculation that

:05:25.:05:29.

they will be joining the debts of the 17 eurozone members. The idea

:05:29.:05:35.

is gaining ground, unlikely to go away. It has the support from Italy,

:05:35.:05:41.

Greece, Belgium and Luxembourg. This deepeniis deepenie crisis

:05:41.:05:45.

started off with smaller smaller economies but it got bigger and

:05:45.:05:48.

threatening to involve the second largest country in the eurozone,

:05:48.:05:52.

France. That is why President Sarkozy is keen to end the

:05:52.:05:55.

speculation surrounding his banks and country when he meets Angela

:05:55.:06:01.

Merkel on Tuesday in Paris. Apart from temporary measures such as a

:06:01.:06:06.

ban on short-selling, many people believe the only long-term solution

:06:06.:06:15.

is the creation of euro bonds. IOU - you give me money, I will

:06:15.:06:20.

repay you by at a certain date and rate of interest.

:06:20.:06:23.

Each individual country is responsible for their own bonds in

:06:23.:06:27.

the eurozone, if there was a euro bond, then the 17 countries using

:06:27.:06:30.

the euro would be collectively guaranteeing each of those bonds.

:06:30.:06:35.

It is good for bankrupt Greece, but not so good for prudent and

:06:35.:06:39.

economically sound Germany. Think of it in terms of of a marriage.

:06:39.:06:48.

German has to have asurity not only for its's own debts but partner

:06:48.:06:53.

debts. It didn't sign up to that but now it is finding out about the

:06:53.:06:59.

debts it didn't know about. Euro bonds might only be the start. Many,

:06:59.:07:03.

including Britain's Finance Minister, George Osbourne, fear the

:07:03.:07:08.

eurozone ultimately needs full fiscal union, where even tax rates

:07:08.:07:12.

are decided centrally instead of by individual countries.

:07:12.:07:19.

But the euro bond cannot happen without Germany, whose Finance

:07:19.:07:22.

Minister ruled out until either eurozone countries gave up control

:07:22.:07:28.

of their own taxation and spending powers. It would be a political hot

:07:28.:07:33.

potato, a dilemma ruffling featers around the continent.

:07:33.:07:37.

If a messy break-up of the euro is the alternative, who knows what

:07:37.:07:40.

monumental decisions will be taken and soon.

:07:40.:07:43.

Major job losses have been announced at the Australian airline

:07:43.:07:50.

Qantas. For the details, rick co is in the BBC's office, Singapore.

:07:50.:07:54.

This is a move to the East? Yes, that is right, right here in the

:07:54.:07:58.

backyard. The carrier plans to undertake a

:07:58.:08:02.

wide-ranging shake-up of its international business operation

:08:02.:08:08.

and to change its Qantas - it could put up to 1,000 jobs at risk, which

:08:08.:08:13.

will basic involve the retirement of older planes, major changes to

:08:13.:08:18.

the international networks and acquisition of jets. The airline

:08:18.:08:21.

faces a possible escalation of industrial action over this plan,

:08:21.:08:26.

with trade unions opposed to any move by Qantas to relocate its

:08:26.:08:30.

international operations off-shore. To keep the international

:08:30.:08:35.

operations viable, Qantas plans to set up basically two new Asia-

:08:35.:08:41.

folked airlines, one is a premium Asian carrier, based either here in

:08:41.:08:45.

Singapore, Kuala Lumpur or in China. The other is the creation of a

:08:45.:08:50.

Japanese low-cost carrier. Well, Australia's aircraft engineers

:08:50.:08:56.

union reacted swiftly at this news. Threatening industrial action

:08:56.:08:59.

within two weeks and considering a court challenge on grounds that

:08:59.:09:06.

Qantas's plan is in breach of terms of its privatisation plans in the

:09:06.:09:11.

early 1990s. You have the markets cheering this news of Qantas

:09:11.:09:17.

reorganisation, which has shares up more than 4% in Sydney trading.

:09:17.:09:21.

Let's take a look at the markets. Certainly, now, the Wall Street has

:09:21.:09:25.

had three days of gains. Some of that volatility appears to be

:09:25.:09:29.

coming out of the markets at the moment. This is what is happening

:09:29.:09:32.

at Asia. The German growth figures - lack

:09:32.:09:36.

thereof, really, half a percent - are going to influence the markets.

:09:36.:09:38.

Everybody at the moment is looking for further evidence that there

:09:38.:09:42.

will be a slowdown later in the year. That is the big concern. That

:09:42.:09:52.
:09:52.:09:59.

is what is happening. Now for a look at some more news

:09:59.:10:02.

from across the UK. Following the riots across England, Prime

:10:02.:10:05.

Minister, David Cameron, has declared war on gangs and says

:10:05.:10:08.

stamping them out should be a national priority.

:10:08.:10:11.

As Jenny Hill reports, many groups have been working with young people

:10:11.:10:16.

for years to try to steer them away from violence.

:10:16.:10:20.

Violence on the streets of West Yorkshire. These pictures were

:10:20.:10:25.

taken last week as rye tkwrooting and looting continued in London,

:10:25.:10:29.

Birmingham and Manchester. 30 people were arrested in Manchester

:10:29.:10:32.

and Huddersfield. The part played by young people in

:10:32.:10:36.

last week's riots is the focus of intense debate. Why were they

:10:36.:10:42.

there? How can they be stopped from doing it again?

:10:42.:10:44.

At this conservation centre in Leeds, they think they have at

:10:44.:10:50.

least some of the answers. We met Danny here, cleaning the pond he

:10:50.:10:53.

helps to build. His antisocial and criminal behaviour meant he was

:10:53.:10:58.

repeatedly excluded from school. Several years on, he is unemployed

:10:58.:11:02.

but he is gaining skills, confidence and inspiration.

:11:02.:11:09.

It gives you something to do to. Do it inspires people as well.

:11:09.:11:13.

Not far away, they will tell you that sport can make the difference.

:11:13.:11:16.

We joined a training session for these youngsters - it is about

:11:16.:11:19.

football, but also about keeping them off the streets and away from

:11:19.:11:24.

gang culture. And if the Government has its way,

:11:24.:11:31.

you are likely to see more of this. Project Matrix in Manchester was

:11:31.:11:35.

set up to tackle criminal gangs. It has had success and secured major

:11:35.:11:39.

convictions. But it is only likely to form part of policy to deal with

:11:39.:11:42.

street crime. It is more than a week since the first riots broke

:11:42.:11:46.

out. Communities have cleared up, offenders are being punished. But

:11:46.:11:56.
:11:56.:12:05.

the task of tackle the root causes You are watching BBC World News.

:12:05.:12:11.

The headlines - the French President, Nicolas Sarkozy, and

:12:11.:12:14.

Angela Merkel, are preparing for a crucial meeting to discuss the

:12:14.:12:20.

ongoing eurozone debt crisis. The difficulties in the

:12:20.:12:24.

communicating the agreement to the markets and for the citizens. I

:12:24.:12:29.

think experience has really shown that we need to stand ready to

:12:29.:12:35.

adapt our crisis management tools to preferably ahead and to be

:12:35.:12:38.

credible and effective. A man has been arrested in the United States

:12:38.:12:41.

in connection with an incident in the Australian city of Sydney

:12:41.:12:46.

earlier this month, when a fake bomb was fastened around the neck

:12:46.:12:51.

of an 18-year-old girl. The victim, Madeline Pulver, had to wait ten

:12:51.:12:54.

hours before the experts removed the device. Thousands of angry

:12:55.:12:58.

protesters have gathered in Canberra to demonstrate against

:12:58.:13:05.

Government proposals for a carbon tax to kerb Grecian emissions. The

:13:05.:13:10.

plans would - kerb greenhouse gases emissions.

:13:10.:13:15.

Indian police have detained a man to stop him starving to death.

:13:15.:13:18.

The Prime Minister promised to crack down on corruption, which has

:13:18.:13:24.

become a major issue in the country. It is time for our newspaper review.

:13:24.:13:28.

We look at the stories making headlines around the world. Le

:13:28.:13:34.

Figaro, and the upcoming eurozone crisis summit in Paris. The two

:13:34.:13:38.

leaders are meeting to try to safeguard the euro. Both say they

:13:38.:13:41.

Download Subtitles

SRT

ASS