23/04/2012 World Business Report

Orthodox Church. In February an all-female punk group burst into a

cathedral to perform a song criticising the Church's close ties

with the Kremlin. Now it is time for World Business Report. You are

with World Business Report. I'm Sally Bundock. Nicolas Sarkozy has

just two weeks to persuade French voters the economy is safe in his

hands. Argentine ministers hold high-level talks with the world's

biggest oil companies as the row with Repsol escalates. $3.7 billion

debt write off for Burma and development aid for Japan. French

voters have just two weeks to decide who they trust most to turn

around France's ailing economy. Front runner Francois Hollande is

proposing change - a 75% tax on the rich and policies to create jobs.

One in ten French people are out of work. Nicolas Sarkozy says he will

rein in spending and balance the budget for the first time in 30

years. It granted a second term, he promises a strong France and a

dynamic economy. Francois Hollande is that -- in the lead at the

moment. You can see the votes on the extreme are virtually equal at

the moment. The issue with Francois Hollande, although Sarkozy is not

generally popular, Francois Hollande is seen as Dahl and his

policies are untested and untried. -- seen as dull. France has lost

its AAA credit rating, growth is seen as anaemic and it has a debt

end deficit situation that is difficult to get out off. -- and

deficit. He does not have a great amount of experience when it comes

to finance and the economy. Given what has happened in France with

politics over the years, very few socialists do. Equally, Nicolas

Sarkozy does not have a great deal of credibility was at having been

in power, he is now saying he is going to change. It is very typical

French politics. Nicolas Sarkozy now has to get the right wing votes

of Marine Le Pen. They will be stepping away from the connection

with Chancellor Angela Merkel and calling for a strong France. For

most of his term, it has been about protecting French banks, rescuing

the financial system, working with Europe - it has been a term

dominated by that. And not being able to make any fundamental

process. France is a very proud nation. Where are the strengths in

terms of its own internal culture and its standing in the world? He

has been seen as a leader that is focused on himself and his wife and

not France. Both of them have said they will introduce a tax on

financial transactions in France, hoping that will go beyond France

and across the EU. This is another form of income. Whoever wins needs

more cash. Will it be a real winner for France? No. It will push more

financial-services elsewhere. We will talk some more about friends

when we look at the headlines later. Executives from Exxon and Sheron

are meeting Argentina's Planning Minister today for high-level talks

on their investments in the country. This follows last week's decision

to appropriate Repsol's stake in National oil producer YPF. The

issue will also top the agenda for foreign ministers meeting in

Luxembourg on Friday. On the streets of Buenos Aires, there

seems to be widespread support for reclaiming YPF. There is still no

indication of what sort of compensation shareholders may

receive. The European Union has already condemned Argentina's

action but the question is whether foreign ministers' meeting today

can really do anything further. Trade sanctions are already being

ruled out in favour of diplomatic pressure and possible legal action.

Simply because Argentina or, for that matter, any country should

ever take a knee-jerk action does not mean, logically, that the EU

should respond with a knee-jerk reaction. We work in a measured way.

We work through the rule of law and through legal frameworks. Using its

own legal framework, Argentina is already threatening to sue

companies of -- involved in oil exploration around the Falkland

Islands. The risk is international investors may now boycott Argentine

altogether. If we look at shale gas deposits that Argentina has, the

government would be keen to open these for investment. The question

is, "Who would be willing to go to Argentina after what happened with

YPF?" Spanish companies are the biggest investors in Argentina but

experts believe neither they nor European diplomats will easily get

through to politicians in Buenos Aires. There is good news for

hundreds of Burmese firms and Burma's government. For more on

that, Sharanjit -- Sharanjit Leyl is in Singapore. More sanctions are

likely to be lifted? We are waiting for that because the European Union

is expected to announce the lifting of some sanctions later today

according to diplomatic sources. Along with having several other

sanctions lifted from the US and elsewhere, Japan has also forgiven

Burma $3.7 billion worth of debt. The Japanese have also agreed to

resume development aid to the country. All this comes following

talks in Tokyo between the country's leaders. They agreed to

plan a special economic zone near Rangoon, which will help a lot of

Burmese businesses. Burma has begun a lot of economic reforms in the

past year after the civilian-led government ended 50 years of

military rule. Burma is a country rich in natural resources but its

people remain fairly poor. This could give Japanese firms something

of a head start in winning business, seen as one of Asia's Last Frontier

markets. The Burmese President introduced a whole number of

reforms since coming into power. We are awaiting this announcement from

the EU on a lifting of sanctions later today. The Dutch Prime

Minister will hold crisis talks with the cabinet after a right-wing

party rejected plans to raise VAT, cut spending and freeze civil

servant pay. Mark Rutte are warned he may have to call -- Mark Rutte

to warn he may have to call snap elections to win the mandate needed

to push through the budget cuts. An Icelandic court delivered its

verdict in the trial of the former Prime Minister. He faces up to two

years in jail if found guilty. The market is digest the news from

China today - HSBC's manufacturing surveys showing further

contractions for the 6th month in a row. More official surveys from

China show that manufacturing has expanded just slightly. This is one

survey, not the complete picture, but it is influential. That

dampened sentiment today. These markets were stronger in Asia today.