21/01/2013 World Business Report

BBC World News. What are America's economic prospects over the next

four years? Now for the latest financial news with Sally and World

Business Report. Hello and welcome to World Business

Report. I'm Sally Bundock. President Barack Obama's second

term begins and the economic challenges remain immense. We

assess what another four years of his leadership will bring for the

worlds largest economy. The world's second largest

equipment maker reports a 30% decline in its profits.

The increasing importance of rare earth minerals. How Japan is trying

to free itself from its dependence As you have been hearing, President

Barack Obama took the official oath for his second term on Sunday at

the White House in a small, private ceremony. Later today, he will be

sworn in publicly in Washington. When Obama first came to office in

2009, the economy of the United States was in a shambles. Things

have picked up since then but the recovery in the world's largest

economy remains fragile. So what will President Obama's second term

do to help boost the US and aid On election night in Chicago two

months ago, a victorious President Obama pledged to fight for the

middle class. I believe we can keep the promise of our founder. The

idea that if you are willing to work hard, it does not matter who

you are all will you come from. ritual of the inauguration can't

disguise how difficult it is to live up to that promise. Struggling

to make ends meet, more Americans are dipping into their retirement

savings to pay the bills. They are basically robbing the future,

rubbing their retirement years, to get through to pay their bills

today. And the problems are too real. The middle class are poorer

today than when President Obama first took office, even though the

actions he took helped save the economy. You made the necessary,

the hard, the politically perilous choices that saved the American

people, saved American industry, saved the global economy. A view

reflected in the performance of the stock market. But the Dow Jones

industrial average is 60% higher today than four years ago. While

Americans continued to struggle to reduce their household debt,

President Obama faces a similar budget challenge. But coping with

the country's ballooning debt, more than 16 trillion dollars, will not

be easy. The motion is adopted and laid on the table! This was the

moment in early January when Congress reached a last-minute deal

to avoid automatic tax increases. But the battle doesn't end there.

Hard spending cuts go into effect in March, unless there is another

deal. America will heed its borrowing limit around the same

time. He is confronted with and will be preoccupied with this

fiscal problem. -- hit its borrowing. Debts are enormous and a

clear disagreement between the President and members of his party

and the Republicans in Congress over what to do with it. His first

inauguration to massive cheering crowds. The second will be a more

muted affair. He is no longer a single of hope but in the middle of

a messy struggle to salvage America's economic promise.

Japan is set to begin a survey of the Pacific sea bed today for

potentially large deposits of rare- earth minerals. Widely used in

electronic devices, securing their supply is seen as increasingly

Hayes reports from Tokyo, the motivation is not purely economic

but is political as well. Japan's new search for where earth

is taking place around the tiny little island, which is actually

part of Tokyo city but nowhere near I am standing here today on the

edge of Tokyo Bay. Actually, 2,000 kilometres from here far out in the

Pacific. Last year, Japanese scientists took samples from the

seabed year that Ireland. Nearly 5,000 metres below sea level. They

found what they think our deposits of a rare earth. They think they

could be up to 200 years' supply of there could be. It is difficult to

get to. Why is there so much fuss? Rare earths are very valuable and

useful in many high-technology products, particularly in the

production of mini-tour high production magnets used in things

like hybrid cars, the electrical cars. Very valuable to Japanese

industry. The other reason is because at the moment one country

controls 95% of the world market in rare earths. That country is China.

This is creating a monopolistic position for China and can set the

prices and control supply. Many countries including Japan are

concerned by that and it is setting off something like a gold rush all

mad rush in the search for rare earths elsewhere in the world. --

or marred -- might rush. And Japan and China are locked in a

territorial dispute over these islands. Back in 2010, the last

time they had an argument over those islands, China did in fact

without warning cut off the supply of rare earths to Japan for several

months and caused a lot of problems for Japanese industry. And so Japan

understandably wants its own supply of this very valuable product.

Sharanjit Leyl is in our Singapore bureau and has got results from

telecoms equipment giant Huawei. Tell us more. How did they do?

They did pretty well. This is a company that has been in the

headlines quite a lot but this time for good reason. It posted a net

profit of rise in some 33% in 2012 from the previous year, all thanks

to new telecom projects and smartphone sales, they say. Of

course it is privately held and ranks behind Eriksson in telecom

equipment sales. It had some 66% of overall revenue coming from outside

China. Amongst overseas markets, Europe, the Middle East and Africa

accounted for the largest share, with China ranking second, followed

by the Asia Pacific and the Americas accounting for the least.

The controversy surrounding the headlines is the perception that it

is seen to be too close to the Chinese government. It was founded

in the 1980s by a former Chinese military officer and has run into

many problems in countries, including the US and Australia, due

to a lot of national security concerns and cider espionage

worries as well. -- side their espionage. It has repeatedly said

it has no links with the Chinese government and has been known for

trying to raise sales in the telecoms sector by edging out

rivals. In fact, it results follow China's second largest telecoms

maker which warned of a net loss of just under 500 million in 2012.

Thank you. Other business stories. Japan's All Nippon Airways says the

worldwide grounding of Boeing's Dreamliner has forced it to cancel

335 flights up to next Sunday affecting nearly 48,000 passengers.

ANA said the cancellations have affected its domestic business the

most and 43 international flights have been cut. With 17 Dreamliners

in operation, it is Boeings biggest 787 client. Last week the Japanese

airline was forced to make an emergency landing in Western Japan

sparking a global alert. In New Zealand, fugitive internet

tycoon Kim Mr Dotcom has launched a new file-sharing business just a

year after he was forced to close a similar website. His previous

venture Megaupload.com once accounted for over 4% of the

world's internet traffic and US authorities claim he used it for

racketeering, money laundering and copyright-infringement. Dotcom

denies any wrongdoing. The original Batmobile from the

1960s television show has sold for an impressive $4.2 million. But you

do get a lot of car for your money. It is almost six meters long and

features an oil squirter fashioned from lawn sprinklers, perfect for

giving your archenemies the slip in a car chase. The man who bought the

car is a collector from Phoenix, Arizona who goes by the rather

Arizona who goes by the rather unlikely name of Rick Champagne.