25/07/2016 World Business Report

a blanket ban on the Russian team over the country's doping scandal.

Those are the latest headlines from BBC World News.

Now for the latest financial news with World Business Report.

It's time for European airlines to fasten their belts.

The region's largest, Ryanair, will tell us if it's flying the same

course as Lufthansa and Easyjet - both hit hard by all

Shares in the company behind Pokemon Go tumble in Tokyo.

We're going to find out why Nintendo's investors have cooled.

Now we go. Bring it down. Sorry about that. Hello, we have got a

cracking programme. In under an hour's time

the budget airline Ryanair will report its latest set

of financial results. Last week, fellow budget carrier

Easyjet reported a drop in profits following the UK's decision

to leave the European Union. The referendum result has seen

a 10% drop in the value This has made it more expensive

for UK-based airlines to buy fuel. The weak currency also raises prices

for British holidaymakers who decide And it's not just the exchange rate

which has been affected At present, British airlines benefit

from the EU's single aviation market, giving them

unrestricted access to cities The referendum could potentially

make it more difficult for companies like Ryanair to fly to Europe

from its London-based airports. All of this has taken its toll

on Ryanair's share price. The company has lost around 20%

of its value in the last month. Let's get more on this. Peter

Morris, chief economist at Ascend, joins us now. Thank you for coming

in at this horrible time of the morning. A couple of weeks ago we

were talking about easyJet's potential problems with exit. EU

airlines as I have just said have that point to point access. EasyJet

is a UK airline. When we leave the EU it will be a UK airline, it will

not be able to do that point to point. But Ryanair is based in

Ireland, still part of the EU. So it should have no problems? You have to

look at the proportion of Ryanair routes that fly to and from the UK,

which is nearly 40%. It was planning to increase year-on-year. 40% of its

flights originate out of the UK? Either they fly into the UK, or they

fly out of the UK. As a consequence, there is a dependence on UK

travellers and the value of the British pound. OK. That could be a

big potential problem. We will see what Ryanair says about that, when

they release these numbers. But Ryanair does have an advantage on

its side of the fact that it has a flexible model, right? Yes. So it

sees a downturn in one area, it simply moves the plane somewhere

else. Is that right? Well, whereas Lufthansa would fly at virtually

everything to and from Germany, Ryanair has the advantage of ink

spread all the way over Europe. It can rebalance its network to a

degree, depending on the strength of individual currencies, depending on

the strength of the economy, and so on. It has got that Flex ability.

Nonetheless, it is now so big and operator that if you start to reduce

the power of the UK market, it will have an impact. Let's talk about the

drop in the pound sterling, which is around the 10% mark. It certainly

has an impact on easyJet, as you know, but when airlines buy fuel

they use dollars. They also use dollars to buy planes. Is that

having an impact on the likes of Ryanair as well? You have to look at

the shape of the UK market. Something like two thirds of that

market is outbound. So the attraction of going from Marseille

to Liverpool is not, perhaps, the same as going from Liverpool to

Marseille. There is a natural flow. It does not mean that just because

the pound is cheaper that everybody flows back to the UK to get the

advantage of the pound. There is a north- south tourism development.

Peter, short and sweet. We appreciate your time. That was Peter

Morris. Shares of Nintendo tumbled as much

as 16.5% in early trade this morning after the company said the smash-hit

mobile game Pokemon Go would have only a limited impact

on its earnings. Mariko Oi is in our Asia

Business Hub in Singapore. Good to see you. I am not too sure

that was the smartest thing for Nintendo to say, also very limited.

The potential could be huge, but Nintendo were saying, not quite?

That is right. I think that is the big question investors have had,

whether people can continue chasing Pokemon Go Rector 's for that much

longer. -- Pergamon characters. -- Pokemon. The statement did affect

the company's share prices, but I should add that its shares have

jumped by some 60% since the launch of Pokemon Go, so be company is

still doing OK. But it is important to remember that Pokemon Go was not

actually developed by Nintendo. It gave the rights to an American

start-up company, to use the characters, to create this game.

That is why the statement came out saying that its impact on the

earnings might be somewhat limited. Indeed. Well, we will keep across

it. Have you played it? No. No? It is not available in Singapore! Well,

there you go. I have not played it either. It is available here, isn't

it? Of course it is. Finance ministers together

with central bank governors have been meeting in Chengdu

in China this weekend. The members of the G20 pledged

to support global growth and improve The meeting in Chengdu was somewhat

dominated by the impact of Brexit, Also at the summit, Britain's

finance minister Philip Hammond said the UK is keen on a free

trade deal with China. Guy Foster is and economist and head

of research at Brewin Dolphin. Guy, great to have you with us.

Let's begin with that deal, because a lot of the pro- exit campaigners

during the lead up to the referendum, that is what they were

talking about, these sorts of things. "We Can do a deal with

China, with the United States". It would be a great deal to get done,

but let's be frank. The UK cannot you any deals until it has

officially left. Absolutely right. It is not in a position to start

negotiating deals while it is still an EU member, and that is one of the

things that people found distasteful about membership of the European

Union, really. I think the issue with China, obviously it is one of

the best economies in the world, so aesthetically it looks very

positive, if you can do a trade deal with China. It and the United

States, they are still a long way geographically from the UK, so in

terms of trade in goods there are going to be challenges to overtake

Europe, where we are already very established in our trade

relationships. That said, we keep talking about how China will be an

attractive offer, but the UK is an attractive offer as well, right?

China still wants access to the UK's economy, the fifth biggest in the

world. It does, and there have been a lot of areas in which China and

the UK have co-ordinated, most notably in things like clearing and

the administration of the Chinese currency, the plan for which is that

it will become a much more significant vehicle within global

trade. It's just hasn't been the case, -- it just has not been the

case over the past few years. It has actually been diminishing, it is a

less important currency than the pound sterling. We are running out

of time, but I will ask you this. After the G20 get together they

issue a letter, a communique. Talk about boring. It is always the same

stuff, we want to do this, we want to do that. The fact is, they have

really done nothing, and there is nothing that they can do, or are

prepared to do, that will boost global growth. Yeah, well, the

communique is always something of a sort of wish list. It would be great

if we could co-ordinate more to reduce environmental damage, if we

could co-ordinate more to support growth, most notably, if we could

co-ordinate more on things like taxation. That is the big story that

the Chinese are trying to push. Then you have these individual topics of

interest. At the moment it is Italian balance sheets. Well, they

don't mention Italian banks by name, but everybody knows that is what

they are talking about. And the statement that they would like to

see, everybody would like to see, the UK to continue to have a close

relationship with Europe. That was the other topical issue in question

at the moment. OK. I wish I had more time on the programme, but we

appreciate your time. US telecoms giant Verizon

Communications is to buy Yahoo's search and advertising

operations for $5 billion, US internet firm Yahoo announced

in February that it was looking at "strategic alternatives"

for its core internet business. Verizon declined to

comment on the reports. A formal announcement is expected

later on Monday before US markets Japan's latest trade figures showed

a 7.4% drop in June exports from one year ago, as a strong

yen made Japanese goods Don't go anywhere. I am staying

right here to take a look at some of the newspapers from around the

world, coming up. See you shortly.