29/07/2013 World Business Report

Benghazi. Those are the latest headlines.

Now it is for the latest financial news.

Plugging into the electric car market. BMW launches the i3,

complete with what it calls its revolutionary ownership model. It

will eat charge enthusiasm among the carbuying public?

Signing on the dotted line. We'll regulators balked at the $35 billion

merger between Publicis and Omnicom, that creates the world's largest ad

agency. A very warm welcome. You are with

World Business Report. Also in the programme: China is to start a

nationwide audit of government debt this week.

Electric cars have been around for more than 100 years, but have failed

to catch on in a big way. At BMW is saying that it plans to change that,

with the introduction of the i3, its first fully electric car. It is made

entirely from carbon fibre reinforced plastic . It will also be

offered with a new ownership model. It will be a bit like the deals with

a mobile phone, where a monthly fee will cover rental of the car,

charging costs and servicing, as well as upgrades to bigger vehicles

if you need to, for the longer trips.

I am joined by Ian Robertson, global head of sales and marketing at BMW.

Tell us how much this car is going to cost. In the UK, it is just under

30,000. With government support, it is just under 26,000. It will be

�369 per month. It covers the cost of the car, the charging of the car,

the rental of the car, just be a bit more specific wish to mark you will

charge from your charge points at home, but we can also provide you

with that and include that within your lease fee. You can have the

flexibility of that. You can have a different guy if he wanted to travel

a longer distance, such as on holiday. -- a different car.

does the charging points work at the users and work? What we wanted to do

is to overcome people's anxieties. The offering of a charge points,

which could be faster, for example, the offer of putting in

infrastructure as well, maybe actual work, but we see there is more and

more charge points at the UK. It has 6000 charging points already. In

London, there is great infrastructure already. Over time,

this will not be the real issue. People want to know, what happens,

can I do this, will I had the support? How long can go for without

being charged again? 100 my ills. 160 kilometres. That really does

cover most people's commute. More than enough per day. Over and above

that, you can have a range extender. It does not drive the wheels, it

provides electricity on the way. charge your car at home, your work,

there is no tax on electricity. What will it cost me to charge my car to

drive for 100 my ills? The current price is somewhat up to �2 50. That

is significantly less than gas. about your main competitors? There

is the Nissan Leaf, a product from Renault, but the market is really

mature. There were 7000 electric cars globally sold. We think this

year the number will be 150,000, so a multiple of 20 times in just three

years. We are at the tipping point. It will pick up very quickly.

The electric car, very interesting indeed. Send us your thoughts and

questions about that. Let's now look at China, because it

has called for an audit of all government debt as concerns grow

over official liabilities in the world's second largest economy.

Fill us in on what China is doing and why it is doing this.

Essentially they want a national audit of local government debt,

specifically, trillions of dollars were borrowed after the financial

crisis of the last couple of years to try to sustain China's growth

rates, but now the economy is growing a bit more slowly, and

thereon lots of fears that some local authorities will not be able

to repay their debts. The last all debt that was done showed that they

had $1.7 trillion worth of debt by the end of 2010. That is a quarter

of GDP. This is the second ever audit that they are doing. It may

threaten China's growth. Lots of fears about local governments that

are suffering under the debt. It says that it has stopped lots of

projects to conduct the all debt. They did not give any details about

the timeline. A lot of government borrowing was taken up after the

global financial crisis. Local governments took about 80% of total

bank lending in China at the end of 2010. A lot of the borrowing has

been sent on infrastructure, such as road and rail. -- has been spent.

There are lots of fears that these projects may not be financially

viable in the long run. Two of the world's biggest

advertising groups are to merge. Omnicom and Publicis revealed on

Sunday they are to form a giant, responsible for promoting brands is

colluding Adidas, Guinness, Starbucks will employ more than

130,000 people. It will share the chief executive role between the two

heads of the company for at least 30 months.

This was quite a surprise announcement. It had all the pomp

and circumstance that you expect when two at agencies an ounce

getting together in Paris. Tell us your thoughts. There is a lot of

excitement and also some surprise that the deal was announced. A lot

of pomp, a lot of razzmatazz. They took to the rooftop of the

Publicis's headquarters. The big question with this deal, will it

stick at all? Will investors actually warm to it. It still has to

go through approval on both sides of the Atlantic . One of these two, why

they want to do this deal, they say they are hoping to achieve $500

million in cost savings. The question is whether clients will

warm to it. Will the French government warm to it? Francois

Hollande he has not got a great track record in terms of approving

this kind of multinational matured -- mergers. It is a sign of the

change in the industry. They have been very dominant for a very long

time. That in the world of Facebook and Google and other organisations,

where they are not necessarily using these huge operations, some of them

are just trying to push out their brands and that owned way, they had

to change and become a different organisation in this day and age.

This deal is about trying to make more money from digital advertising.

Revenues are quite low but they have a lot of potential to grow

exponentially. So the question is whether they can do that. It is also

around making sure they have got consistency. The growth potential in

emerging markets is huge. We will see how it works over the next six

months. The story that we had just been talking about is all over the

front page of the Financial Times and the business section of most

papers. We will talk a bit more about that in a moment.

China and the European Union have resolved a long-running spat over

solar panels. The agreement which was reached after six weeks of talks

which -- will see China's solar products regulated to a minimum

price. It has also staved off a war over other products. EU solar panel

manufacturers had accused Chinese companies are dumping products and

selling below cost. A brand-new trading week. Let's look

at how the markets are faring. As you can see, quite a significant

fall in Japan. The story about China auditing debt does increase fears in