22/12/2011 World Business Report

A those are the headlines. For the latest financial news, it is time

for World Business Report. Welcome. Slowly but surely. Figures

out later will confirm the US economy is showing signs of

recovery. But the eurozone crisis poses a risk.

Those concerns over Europe's debt crisis are affecting markets in

Asia. Russia's state of the Union. Dmitry

Medvedev gives his final address later amid disappointment about a

lack of economic reform in the country.

Despite growing evidence that Europe is slipping back into

recession, all the signs are the world's biggest economy, the US, is

recovering. Final figures out later are expected to confirm GDP growth

in the three months to September at 2%. Some positive signs for the 4th

quarter. Stronger Christmas shopping, a slight upturn in the

housing market are some reasons. But there are still challenges at

home and abroad. The US economy is picking up speed, but it is slow

going. At this high end car service, bookings are up in at this season

of holiday parties. But it is still looking uncertain. We are just

getting to the end of high season. It has been a good season, not an

amazing season. We are up about 10% from this time last year. It is

just that we do not know what is going to happen in January and

February. The US economy has been improving steadily, if slowly, over

the past year, thanks in part to small businesses like this one.

There are still plenty of obstacles that could get in the way of a

recovery in 2012. Europe's debt crisis could mean the eurozone

recession or a credit crunch and here at home, it could be a jump in

taxes. This is a concern for this man's clients. The President has

put forward a whole lot of proposals. He has to act on them.

This man is more positive, focusing on the success of many businesses

in the last year, and predictions of even stronger growth in 2012.

Privately-held companies make up the vast majority of economic

activity in the US. There is about 27 million privately-held companies.

Over the past year, they have grown between five and 7%. They drive a

lot of economic impetus and they are growing. But the US needs to

keep the momentum going. They need to stay on the road to recovery.

More concerned on the markets over the eurozone debt crisis after the

ECB lent record amounts to the region's banks on Wednesday. Let's

get everything from an Asian perspective. How are the markets

today? Not so good this Thursday. All

markets are down, which means they are ending the rally that we saw

over the last few days. One of concern that everybody has is what

is happening in Europe. We saw lenders seeking to borrow more cash

than what was expected from the ECB. That is affecting the currency

market. The Euro is weakening as well as all of the Asian currencies

against the US dollar, which is still seen to be a safe haven. But

in the equity market, one market has been hit hard. That is in China.

The Shanghai Stock Exchange is trading at the lowest level in two

matches. That is also because banks there are seeming to keep cash

instead of lending to companies. Analysts say that demand for cash

will rise ahead of the Chinese New Year holiday, which could

potentially mean a credit crunch. That is why the Shanghai shock --

Shanghai Stock Exchange has been hit.

The Russian President Dmitry Medvedev will make his last state-

of-the-nation address later today. Over the weekend he warned Russia's

political system has exhausted itself and need for modernisation.

He is expected to spell out detailed in his address. For many

investors this underlines how resistant to change the country has

turned out to be. Corruption is widespread and the gap between rich

and poor is wider than ever. The economy is too dependent on oil and

gas. Thank you for joining us. Looking at Russia and the way it is

today for, how the foreign investors view the country? Russia

has an image problem with investors. Corruption, red tape, uncertainty,

bad political stability are still concerns that foreign investors

have. The President will try to address some of these concerns in

his speech today. How much importance is given to foreign

investment in Russia? Government highlights the

importance, but at the same time, judging by their actions, it seems

they are also struggling. On the one hand they have revenues coming

from the energy sector. In some ways there is not that much

pressure on the government to bring in investors. Demand for oil and

gas from Europe is not going to stay strong forever. What kind of

other options, or how his Russia diversifying its economic plan?

Modernisation, emphasis on the IT sector, emphasis on innovative

sectors will all dominate the agenda in the coming years. But we

will have to wait to see how they implement these projects. I think

in the long run, Russia will try to basically invest in sectors that

are not based on natural resources. But this will take a wider

political agenda to root out the corruption. The key is to

strengthen the judicial system. We have to see how Vladimir Putin and

Dmitry Medvedev will deal with the problem. How much of an impact do

you think the polarisation of wealth is having on Russian

society? I need to draw your attention to the results of the

last parliamentary elections. It was not the Liberal parties that

won the vote, the people who were disappointed with the ruling party.

These were the communists. The main message from these parties was the

message of anti-corruption and the pledge to deal with this new class

of people. This means that people are very sensitive to the fact that

the world from the energy resources is not trickling down. This is a

serious issue. Plenty of things to think about. Thank you very much

indeed. Italy's parliament is set to give

approval to a package of its -- of austerity measures. Protest erupted

in the Senate on Wednesday as the Prime Minister asked for a vote of

confidence over the plan which includes tax increases. Figures on

Wednesday showed Italy's economy contracted in the three months to

September. Borrowing costs have been rising over concerns it will

not be able to manage its debt. Belgian is set to be paralysed on

Thursday by a national public sector strike over pension reform.

Its three main labour unions started a walkout at nine o'clock

on Wednesday involving workers in public transport, hospitals,

schools and government believes. Belgium's new government is trying

to raise the effective retirement age.

The European Commission has given temporary approval starting today

for the Belgian, French and Luxembourg governments to give loan

guarantee to struggling back Dexia. The commission says the guarantees