26/09/2016 World Business Report

that attracted 10,000 pilots and some strange aircraft.

with Aaron and World Business Report.

Watch out for a hard landing in China.

Yes, one of the world's leading economists tells us,

the BBC, that he's worried about a slowdown in China.

In fact, he tells us it's the great threat to our global economy.

And as India prepares to launch its latest satellite

with five other countries piggy-backing on the same lift-off,

we're asking could rockets like this one be money-making machines

If you're tuning in for the first time, stay where you are because I'm

only asking for about eight minutes. This is a bite-size exciting

snapshot of the latest in business and money with lots going on. We

will talk about the India launch and oil and OPEC, does OPEC have any

power left? I don't know, we have an expert in the studio waiting right

over there. The former chief economist

of the International Monetary Fund has said that a slowdown in China

is the greatest threat Ken Rogoff said that a calamitous

hard landing for one of the main engines of global growth could not

be ruled out and that China has been slowing down faster

than official fugures suggest. So what is happening

with China's economy? China's borrowings hit $25.6

trillion at the end of 2015. This figure includes government,

corporate and household borrowings. China's debt is now nearly 250%

greater than the value of what it produces

every year, or its GDP. This is due to Beijing's

repeated use of cheap credit This has unleashed a huge,

debt-fuelled spending binge. Ken Rogoff has been speaking

to our economics editor, There's no question it's really

China. China has been the engine of global growth, the US is picking up

but China has been really important and China is going through a big

political revolution, there's no question about that. The economy has

slowed down much more than the official official figures show and

if you want to look at a part of the world that has a debt problem, look

at China, they've had a credit fuelled growth and these things

don't go on forever. Everyone says China's different, the state owns

everything, they can control it but only to a point. I definitely worry

about China, a hard landing in China. We're having a pretty sharp

landing already and I worry about China becoming more of a problem.

We've taken it for granted that whatever Europe's doing, Japan's

doing, at least China is moving along and there isn't really a

substitute for China. I think India may come along some day, it's doing

better but it's fallen so far behind in size that it's not going to

compensate. That's definitely the area of the world I worry most

about. What could mitigate the risk of a Chinese hard landing, what

could China do and what could the rest of the world do? That's a

really tough question! Ideally you would like to regenerate growth and

be more on your feet when this happens so that when China starts

slowing down, Europe's doing better, the US is already doing better,

maybe some emerging markets doing better. You would like the rest of

the world not to be so dependent on China. But the IMF has marked down

its forecast of global growth nine years in a row, and certainly the

rumour is they are about to do it again in this forecast. In the early

stage it was the advanced countries, but for some time now it's been

China. And there are limits to what you can do when a country that big

is slowing down, and it can slow down a lot when it's growing that

fast, so there are limits. Ken Rogoff, one of the world's

leading economists. The world's top oil producers must

take a decision to stabilise prices according to Algeria's

energy minister, Members of the oil cartel OPEC

are in Algiers today for an energy conference,

ahead of informal talks I think it could be happening

tomorrow. Not too sure but we think. This gathering is significant,

because the last time members of the organisation

of Petroleum Exporting Countries met in Doha in April,

they failed to reach Oil prices have generally been

depressed after two years of oversupply, thanks in part

to deep disagreements between OPEC There are concerns that failing

to agree on a production freeze Colin Smith is the director of oil

and gas research at Panmure Gordon. Great to have you in, thanks for

coming in at this ungodly hour. OPEC, we keep hearing about the

gathering, they are having a sideline meeting of a sideline

meeting we keep hearing. My point is OPEC, who are they any more? It's

almost an organisation that was once mighty and powerful but has no power

today. OPEC could have the power but the policy was changed in 2014 in

November and there's no sign of that changing. While that stays the same

and OPEC isn't active then that's a problem. Remind people, why did

Saudi change the policy? They are the biggest member and they produced

the most. They are a third of OPEC production and they are the most

important member. They changed the policy because they could seek non-

production rising rapidly and they thought they had to take a stand.

I'm no expert, you are the expert, but didn't they get a bit miffed

about the Americans doing fracking and producing cheap oil in the

States and they wanted to price out the Americans? America was the

largest piece of incremental oil supply. Choosing a lower oil price

path was certainly intended or expected to put pressure on the

Americans and it has. US oil production is down about 1 million

barrels a day year-on-year, but one of the things causing OPEC some

banks at the moment is this loss of OPEC production is slowing down and

perhaps we will see an increase next year. The whole idea the market

might come in to balance this year now looks like it is fading into

next year, and that splitting extra pressure on the organisation,

especially the weaker members. And they are suffering, Russia,

Venezuela, because oil is in the price it used to be when they were

living off the land on it -- there's nothing going to happen in this,

they can't get to an agreement, can they? The Saudis, who took Iran...

Correct me if I'm wrong, when Iran was blacklisted, the Saudis came in

and they were happy to take Iran's market share, now the Saudis are

saying we will cut production if Iran does. Poor old Iran, they just

got back into the picture and they need to build up their economy.

Saudi Arabia isn't offering to cut production. Sorry, freeze it. What

we possibly got is a freeze but you're right, it's difficult to see

the policy conditions have changed but the big differences are that

Iran will be present at this meeting, it wasn't present at Doha

so when the Saudis effectively renege on what everybody thought was

going to be a reasonably common central outcome, Iran is here this

time around and on top of that, you have oil prices continuing to stay

very low -- consensual. We are down $10 year-on-year on average compared

to last year and it looks like market rebalancing will take another

year and there's more pressure in OPEC to see something done. I agree,

it's very hard to see a deal coming out of this. We will wait and see

but don't hold your breath. Colin, always a pleasure. Thank you, my

friend. Let's talk about this, putting

satellites into orbit. We know it's expensive but in India, India is

doing it cheaper than any other country. Their space agency ISRO has

found a way to make money by allowing followed, or in satellites

to piggyback off its launch vehicles. This is going up, five

other countries are piggybacking off the back, it's amazing how cheaply

they can do it but this is a bit of two of a money now? Yes. I spoke to

the head of India's space agency a month ago and he says they plan on

having one launch every month. -- bit of a moneyspinner now. We had

five foreign satellites go up today along with the main Indian

satellite. But in June there were 17 foreign satellites that went up into

space along with three other Indian satellite. What the space agency is

saying is that at the moment they've made more than $120 million from it.

They are trying to make their operations cost effective so

obviously there is a national requirement to send satellites to

space for Indian purposes, whether it is mapping walking indications,

but they're trying to make those operations more cost-effective and

that's good news for a country that's often been criticised for

spending money on a space programme when it's got so many other

problems. Short and sweet, I wish I had more because I've got lots of

other questions. That's it for now, though. I will be back with Adnan to

talk about the newspapers from around the world. Goodbye.