25/06/2014 World Business Report

appearing to bite Chiellini. It happened at the end of their 1`0 win

in Natal, that saw Italy exit the tournament. Those are the latest

headlines from the busy world and. Now for the latest financial news

with Sally. `` from BBC World News. First they were up, then they were

down. Why the latest data on US growth could make dismal reading. No

oil, no gas, no cash. The conundrum facing Libyans as they go to the

polls. Hello and a very warm welcome. You're with World Business

Report. I'm Sally Bundock. Also calls to overhaul Boeing's flood

controls after last year's Asiana Jet crash. It was a tough winter for

the world's biggest economy, the weather stopping many people

spending. Output fell by 1% at the start of the year as a result. But

things could actually be worse than originally thought. Final data on

Wednesday could show the economy shrank by 1.7%. How worried should

we be? This man designs and manufactures

children's furniture. For this small Brooklyn company, the start of the

year was bleak. Orders didn't return after the usual dip over the

holidays. The drop in sales was pretty drastic and normally it picks

up again mid`January, but this year it took until April. The US economy

shrank in the first three months of this year, hurting businesses like

this and raising fears the US recovery was fading. Still many

economists say it is misleading to suggest America is close to

recession. Yes, it was a surprising slowdown but it did reflect the fact

that in the second half of last year we saw a strong pickup in growth

that was driven more by businesses restocking than it was necessarily

final demand, and that inevitably meant you had to have some slowdown

at the start of the year. But even if the optimists are right and

America is bouncing back, economists from the IMF to Wall Street have

been forced to lower their growth forecasts for the year. For many

Americans this report will feel like they've taken one step forward and

two steps back. But there are signs that the world's largest economy is

making progress, not least because of the improvement in the US labour

market. Still it is a reminder that the path to recovery doesn't always

follow a straight line. When we get the number for the US

growth we will let you know. But let's talk about what's happening in

Libya because they do go to the polls there to elect a new

parliament today, conflict between militia groups and the government

mean Libya is now earning next to nothing from its main sources of

income, oil and gas. The government debt is ballooning and the huge

number of bank robberies by militia has started a cash crisis. Can a

newly elected Congress do anything to repair all of this?

In September 2011, only weeks after the overthrow of Colonel Gaddafi,

Britain's air force flew into Triple`E hundreds of millions of

dollars in bank notes. Estate reserves which Libya had been

holding abroad `` Triple`E. Now the government is burning through all

this cash. Since militias closed the oil export terminals on the east

coast of Libya, government revenues have fallen almost two zero. But

payoffs to armed factions have pushed government spending to over

$50 billion a year. `` to zero. When the militias demand payment the

government is left with little choice but to comply. We have seen

the militias surrounding the General Congress, kidnapping the Prime

Minister, they can impose whatever spending they want on the

government. There are no fewer than 1700 militia groups in Libya, and

they need to fund their operations. To do this many rob banks. Nowadays

the central bank is scared to send out money to bank branches in the

provinces. This has led to acute cash shortages, affecting both

households and firms. This is leading to a state of financial

paralysis at a working level. Companies, even quite large ones,

are asking their import used to stay at home, not only because they can't

play them but they can't do the normal business transactions they

need to do `` asking their employees. The elections on

Wednesday are meant to produce a new government that can make a

settlement with the militias and restart oil exports. But a low voter

turnout would make its mandate very questionable.

A terrible plane crash that killed three schoolgirls and injured dozens

of others has prompted a review of flight controls. Sharanjit Leyl is

in our Singapore bureau with the details. Tell us more about what

this means for the airline. That's right, Sally. US investigators

essentially have concluded their 11th month investigation into that

crash last delight of as Jana's treble seven. They said pilot

errors, inadequate training and confusion about the airport a

plain's automated controls were all to blame. The NTSB said the speed

protection system on the Boeing 777 200 ER should be studied and mainly

redesigning. That crash in San Francisco last July killed three

people and injured more than 180. The NTSB is making about two dozen

recommendations to Asiana, Bahrain, the federal aviation agency, the

firefighters, and the San Francisco city and county, they have called

mismanagement as the cause of the crash but Boeing and Asiana should

revise flight training manuals to better explain the auto throttle

functions. All of this is likely to have a negative impact on the

fortunes of the South Korean airline, South Korea's largest

carrier. Its shares are down marginally today. Asiana has

acknowledged the aged PSV has recognised the factors that

contributed to the accident, including the complexities around

the auto throttle system `` NTSB. Boeing is likely to see some fallout

in its business, but it respectively disagrees with the findings about

the automated system. Boeing's shares closed down with the broader

market by over 1%. Thanks very much. Let's have a look at some other

business stories and South Africa's longest and costliest strike is over

after five months. Platinum miners are returning to work after the

three biggest firms, Anglo American Platinum, Impala Platinum and

Lonmin, signed a three`year wage deal with the miners union. After so

much time away from the job, the miners will have to undergo training

and health checks before the mines can return to full production. Like

a Rolling Stone gathered no Moss at an auction in New York on Tuesday.

Bob Dylan's handwritten lyrics for the classic rock song fetched $2

million in a Sotheby's rock memorabilia sale. The new owner is

said to be a fan from A new regulation aimed at stubbing

out smoking comes into effect in Indonesia this week. It forces

manufacturers to put graphic health warnings on cigarette packets.

Indonesia is a major tobacco producer, and there are more than 50

million smokers there. And it appears that the new laws are yet to

have an effect on demand for cigarettes, as reporter Kiki

Sriregar found out when she spoke with smokers on the streets of

Jakarta. If you are a smoker in Indonesia,

you can light up just about anywhere. You can smoke on the

streets... In parks, and public places. Even in some government

offices. In Indonesia almost half the male population spoke everyday.

The Indonesian government has tried to decrease the number of smokers

but they haven't been successful. From this week Indonesian cigarette

makers have to start warning smokers of just how unhealthy their habit

is. Cigarette packets will be required to have graphic warnings

which cover at least 40% of the package. But there was little

evidence of those images at stalls in Jakarta today. The smokers here

have no idea about the new rules. TRANSLATION: I don't think it will

make a difference as long as people still sell single stick cigarettes,

because the majority of Indonesian smokers are from poor backgrounds

and they tend to buy single sticks and not packs. I know a bit about

this new rule but those images won't have an impact because smoking is an

addiction for me. I would rather go hungry than not smoke. When I don't

smoke I can't think so it won't make a difference to me. Cigarettes are

extremely cheap in Indonesia because tobacco taxes are so low income

Paris and to other countries in South East Asia. Activists say

Indonesia needs to raise taxes on cigarettes, but that's challenging

because the tobacco lobby is one of the most powerful in the country.

The markets, a flat day I have to say, slightly down in Asia so far.

Japan down by 0.6%. To the close in the United States and the oil price,

oil creeping up slightly but Brent crude down a little bit, the

situation in Iraq keeping investors busy. I will see you soon.

Thanks to Sally for that. The papers in a moment but first, the