27/10/2016 World Business Report


27/10/2016

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Now for the latest financial news with Sally and World Business

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Last chance saloon: The EU battles to save its free trade deal

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with Canada and rebuild its credibility.

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Plus, how deep is the black hole at Deutsche?

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We await news of massive losses at the bank the IMF has called

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Also in the programme: Samsung's smartphone earnings plunge.

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We'll have the latest from Rico in Singapore.

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So we start in Brussels, where this man, the Prime Minister

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of Canada, Justin Trudeau, was due to sign a major free trade

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That was the plan, the reality is that as of last night the deal

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was still being blocked by regional parliaments in Belgium and talks

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to break the deadlock will resume shortly.

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It's hugely embarrassing for the EU, which has been struggling to show

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unity and restore its credibility after Britain's Brexit vote.

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Let's just remind you what's at stake with this deal and it's

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called the Comprehensive Economic and Trade Agreement,

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or CETA for short, and it aims to eliminate 98% of tariffs

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That could save EU exporters more than $500 million every year.

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Supporters say the deal would increase trade by some 20%,

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However, critics say it would give too much power to big business.

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They are worried EU regulations on product standards would be

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weakened and that multinationals would be able to sue governments

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It's taken seven years of talks to get to this point and 27

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out of 28 EU governments want to sign the agreement.

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But Belgium cannot back the deal because three of their regional

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parliaments in French-speaking parts of the country are blocking it.

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The row demonstrates just how hard it might be for the UK to do

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a post-Brexit trade deal with an EU that has

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On Thursday Canada's trade minister could scarcely hide her frustration.

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Today, 27 and half of the member states of Europe do support CETA.

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As we have said on many occasions, and as I am very happy to repeat

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today, this is an excellent agreement.

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It's an agreement that as the Prime Minister has just said

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in the House of Commons, we made significantly more

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progressive since we came into office.

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I am not - I'm going to disappoint the journalists here -

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I am not at this time going to deal in hypotheticals.

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As of this moment, the summit remains on Europe's agenda

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If there is a deal to sign tomorrow, Canada will be there.

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But as we have said, the ball today is in Europe's court.

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Charles Lichfield covers Europe for the political risk consultants

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Good morning. What you think will happen? There are still negotiations

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going on and you can imagine we will wait for the deal is to be signed.

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They could also decide not to sign the deal and the negotiations go on

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for the next two months. But it is quite likely that Europe manages to

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get the CETA deal. Question for me is now whether any other partners

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will be willing to engage in serious negotiations, knowing that every

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single parliament will have a say and be able to bring in their local

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politics. That is the big question now, given the experience Canada has

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had. What does this mean for future trade agreements with the EU? It

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will be difficult. The fashion for trade agreements is to have

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complicated agreements that don't have the removal of tariffs, but

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also remove a number of nontariff barriers and also have a

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concentration on investment and providing assurances to investors.

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That's what is at stake here. In the future I don't think the Americans

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are going to be especially confident. Similar for what will

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happen with UK- EU relations. There will have to be a comprehensive

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trade deal eventually wants the UK has left and I don't think

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Parliament will be completely sidelined on this. TTIP has been

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under discussion for a long time and there has been a lot of protest

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about that as well, certainly in Brussels and elsewhere. How does

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Brussels move forward? How does the European Commission and European

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ministers go forward? If they have this kind of situation every time

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they try to broker a trade deal if -- it will take them years if not

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longer and it will be very difficult. I think the commission is

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learning that they can't just argue trade is good and therefore we must

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sign the deal is, they are starting to learn that the need to provide

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more assurances and offer some protections for Europeans. We

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already saw on Thursday and Friday a conversation about not just free

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trade but also protection measures, or tariffs that are specially

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targeting other countries which have managed to use price dumping. So I

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think they will try to be more flexible and rapid free trade with

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policies that protect some European businesses. Thanks for your time

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this morning. When we get news of any movement with that today we will

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keep you across it on the BBC. We are also looking

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at the bank the IMF called Germany's biggest lender

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Deutsche Bank announces results Analysts think it could have

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lost some $660 million, that's a third of $1 billion,

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in the past three months. Deutsche bank results are due to be

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released in just over half an hour. We will update you when we get the

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numbers and we will have expert analysis as well. The other company

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out with its latest earnings is Samsung.

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Samsung Electronics has vowed to recover quickly

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after the disastrous set of financial results.

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It has reported a 30% plunge in operating profits in the past

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three months, in line with the warning it gave

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It's no surprise of course, after the company was forced

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to recall its flagship Galaxy Note 7 smartphones following a spate

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Those images went worldwide and all but wiped out its pockets from the

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mobile phone division, which has been the main driver of its success

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in recent years. Rico Hizon is following this

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for us in Singapore. We knew the news was going to be

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bad, this is pretty grim, isn't it? It is. Samsung's what online has

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been somewhat burdened by the Galaxy Note 7 scandal and it has written

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off about $5 billion in recall expenses and lost sales, but the

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company says it is confident things will pick up in the next quarter and

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if you take a look at the stock price it seems the market agrees. It

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is up today by almost 2%. We spoke to someone from the company grew --

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Quest Factory and he said it was almost behind them, except for one

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issue. We don't really know what happened and Samsung haven't said

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what happened, which implies to me they don't know exactly what

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happened. Beyond that I think of of this is behind us, based on what we

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currently know. They've done the recall, they've taken the charge.

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The uncertainty is that there are some notes seven customers who are

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holding out for a better deal and have asked for a roadmap. They want

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to stay with the Note family, so it will continue. Samsung has said

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that. They say they will re-examine every aspect of the Galaxy Note 7,

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hardware, software, to determine what led to the phone's

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cancellation. Thanks a lot. Good to see you. If I

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say goodbye, the chairman of India's Tata Group warns the company might

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have to write off investments worth some $80 billion. This is in a

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letter to the board. -- $18 billion. He said he became a lame duck

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chairman due to constant in -- interference. Tata said it currently

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had no response to these allegations. We will be deeper into

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these allegations in a few minutes. There are a lot of stories I haven't

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been able to mention today. Kessler making progress and Snapchat may go

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into flotation next year. -- Tesla. Goodbye for now.

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Sally will be joining me lately for the papers full -- joining me soon

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for the papers. Scientists say every child should be

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screened for an inherited form of heart disease when they

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have their routine jabs.

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