08/09/2014 World Business Report

treatment on Monday. Those are the latest headlines from

BBC World News. Now for the latest financial news with World Business

Report. The US Treasury fights back against

tax inversion, when companies move their headquarters outside of the US

to escape the high American corporation tax.

Japan's economy contracts by the largest amount since 2009. So what

does this tell us about the efficiency of Abenomics?

I'm Sally Bundock. Also in the programme: How is

Polish economy coping with the continuous flood of workers

overseas? We will take a look at that. But

first, it's called a tax inversion. Few will have heard of it, but

US Treasury Secretary Jack Lew. The practice has been around for years.

But its popularity has grown in recent months and

controversy surrounding it. The BBC's Michelle Fleury has more from

New York. Burger King made headlines when it

said it was shifting its headquarters across the border. All

part of its deal to buy Canadian coffee shop business Tim Horton, so

why all the fuss? Burger King's move is part of a cat strategy known as

an inversion, when a US firm buys a foreign company

headquarters abroad. One incentive is that America's corporate tax rate

is 35%, the highest in the industrialised world. Tax

inversions are not new, but they are back in the spotlight. The

multinationals are leading the charge on this. Financial consultant

Benjamin Alderson said it's not just be companies trying to take

advantage of this loophole. It is something I am increasingly asked by

clients, what can we do and what would we recommend? I think it is

very much something that is in the bad right now. The most powerful man

in America isn't a fan. Even calling the practice unpatriotic. You don't

get to pick which rules you play by all which tax rate you pay and

neither should these companies the White House wants the loophole

outlawed. The White House has asked Jack Lew to look into ways the

administration could take action. It is unclear what available remedies

there are. He has also asked Congress to look for long`term

solutions through tax reform. Barbed with mid`term elections looming,

many have written off any chance of reform happening soon.

The latest news from Japan about the economy is not good at all and

raises fresh doubts about the effectiveness of so called

Abenomics. Revised data shows the economy shrank 7.1% in the three

months to the end of June, compared to the same period a year ago. Rico

Hizon is in our Asia Business hub in Singapore. He always puts these

things into perspective for us. Master see you, Rico Hizon. The last

more. The contraction was the largest since January`March, 2009,

five years ago. Household and corporate spending slumped the most

as Japanese consumers stop spending on appliances prior to this tax

jumped from 5` 8% in April. The consumption tax is a double`edged

sword, it could be a problem short term, but on the flipside, this

reduces the government's ballooning public debt, which is one of the

world's biggest. Many economists hope that future public spending

will jump start economic growth. This, coupled with wage increases

and a additional economic reforms from the Prime Minister will

hopefully put the economy back on track `` and additional. This

revised economic indicator is, indeed, as we can see, a lagging

indicator and what everyone is looking out for is this quarter's

later. The Bank of Japan last week later. The Bank of Japan last week

held off on a monetary policy change and more stimulus as they believe

the economy will indeed grow this quarter. Expertss forecast more than

a 3% expansion. Thank you very much. Good to see

you. We will look at the markets later in the show to see how it is

impacting the story. Let's squeeze in this one.

Unlike most of its neighbours in Europe, Poland has avoided falling

into recession over the past decade. But that hasn't stopped a rising

tide of the country's most ambitious young workers leaving to work

elsewhere. Many of them don't return. So how can Poland sustain

its healthy growth? Nigel Cassidy reports from Warsaw.

With well over 2 million young Polish people are brought, it is

hard to find anyone who has come back to apply what they have learnt

and start up a business. Poland's ubiquitous plumbers and builders are

still away. This fully certified translator is one of the few who is

back at the age of 30. She worked in a British sandwich factory and an

Irish publisher. She thinks it is only those experiences and contacts

which set up to find well`paid work she can do back at home. Not only

did I improve my language skills, but also I learned a lot about the

publishing business, about advertising, about customer service.

And, that collection, which is very... The last few things are very

useful for me in my current job. Until now, the Polish economy has

kept growing in spite of the continuing tide of young people who

leave their country looking for work, but don't come back. Now,

there is evidence that can maintain this fast growth, the economy needs

to innovate and businesses say they are finding there is a shortage of

younger people with experience to help them do that. Poland badly

needs to build up its digital service sector. That's according to

this 40`year`old recent return who has drawn on his senior programme

experience with Microsoft in the US to establish a software business

that enables hotels to adjust their room rates in line with demand from

online booking sites. We started selling our services all around

Europe but also we started going outside Europe, the United States,

the Canada, to Mexico, to Thailand. So, instead of exporting labour, we

could export software, sophisticated services to countries like the UK,

the US or anywhere else in the European Union. Until now, Poland

has kept on the right economic track, growing faster than many of

its flatlining neighbours in the euro currency zone. But if its

brightest and best day a way and keep `` putting down roots, it might

need to look elsewhere for experienced workers.

In other news: China has posted its trade numbers for August, with a

nine point 4% rise on the year. It follows a record trade surplus in

July as there were signs the government stimulus measures to stop

the economy slowing down have generated a rebound in exports.

We will look at those in a moment. Before we do that, let's mention a

few corporate stories. The Japanese online retailer,

Rakuten, is reportedly in talks to buy Ebates, the US cashback shopping

site operator. If the sale goes ahead, it would be the Japanese

firm's fifth major overseas investment over the past year. The

acquisition price for a majority stake is said to be about $950

million. The UK's objection to the European

Union's plans to cap bankers' bonuses is set to be heard in the

bloc's highest court today. The UK Treasury wants to overturn the cap

which it says was rushed through without a proper impact assessment.

The cap limits bankers' bonuses to a year's basic salary, or double their

salary with shareholder agreement. So, let's have a look at the

financial markets with quite a lot of the minds of investors at the

moment as we have already mentioned. The Japanese revised growth number,

which of course was worse than originally thought, however that

isn't wobbling markets too much. You can see Japan is flat today. Hong

Kong is down by one third of 1%. In China, we had the number, we also

have other data from China, the imports falling by 2.4% in August.

Mixed news about the Chinese economy. Let's have a look at the

pound. Howedes that pound trading? `` how is. It has lost open 6% of

the value, weakening off the back of the poll that was in the Sunday

Times showing that with two weeks to go before the Scottish referendum,

the yes vote is now in the lead just slightly. That is causing markets to

wobble a little and people are pulling out of the pound, the pound

weakening there versus the dollar. Also weakening versus the euro as

well. That is all from me. I will be back to look at the papers. Stay

with us here on BBC World News. There's growing concern over the

number of young British Muslims who being radicalised