27/11/2015 BBC Business Live


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This is Business Live from BBC News with Aaron Heslehurst and


Russia prepares to crack down on trade with Turkey.


But is it in danger of doing more damage to its own economy?


Live from London, that's our top story


Russia prepares for wide-ranging economic sanctions


against Turkey after they downed one of their military jets


And have you got that Black Friday feeling?


From toasters to TV's, retailers are slashing prices today


in a bid to get your cash, but is it worth the hype?


As markets across Europe open we have the latest on the winners


holiday but will open for a shorter trading day later.


And we'll be getting the inside track on some of the biggest


stories of the week, with our Business Editor Kamal Ahmed.


the markets including the biggest merger in pharmaceutical history.


Today we want to know what you think of Black Friday -


Welcome to the programme. of time and money?


It hopes to put in place sanctions against the country in the next few


days - if the sanctions go ahead it's likely that both countries will


lose out economically. The countries do $33 billion worth of trade each


year - until events of this week that number was


Now Prime Minister Dmitry Medvedev has called for a range


of economic sanctions to be drafted within 2 days.


There are fears the TurkStream gas pipeline project,


which would supply Europe via Turkey, could be under threat.


Russia has already advised its people not to travel to Turkish


tourist resorts - normally the top destination for Russians.


.5 visited Turkey last year. -- 4.5 million.


It's already stepped up checks on Turkish food products - and


It's also putting pressure on Turkish businessmen.


39 delegates at an agricultural exhibition have been deported


Sir Andrew Wood, a Former British Ambassador to Russia and now an


Associate Fellow with the Russia and Eurasia Programme at Chatham House.


Thank you for coming in. We are talking about bans and restrictions,


they could hit joint investments between the countries, including


that people in. Do you think that Russia is in danger of cutting off


its nose to spite its face? Certainly. It is developed a habit


of sanctioning everybody. They are very unhappy with the Russian


population because the main seem trivial but depriving yourself of


tomatoes altogether, that is a blow to people. We looked last year at


the bands and the sanctions on food from the EU. Turkey had come in and


had been filling that Hall and feeding effectively the Russian


population. Are the in a situation where we might see popularity fall


for the Russian leader because of this? I think this is a temporary


phase. It is silent noise without having the long-term significance


yawned making the idea of the close Russian Turkish alliance rather


promote. The Turkish pipeline was a periodical idea. -- theoretical. It


did not have a great future. The trouble is both countries are ruled


by similar types of people. People who are easily insulted making the


decisions. It is difficult to find any kind of face-saving formula? The


Russians are accusing the Turkish Prime Minister of corruption.


Biggest temptation for the Turkish people to return that compliment. On


a day-to-day basis, which could put a dent in the economy, that is


energy. Correct me if I am wrong, 57% of Turkey's gas comes from


Russia. Turkey also buys energy like steel, wheat, if Roger was to turn


off some of its gas, they might start with 20%, what does Turkey do


with its energy? There are other countries in the region that have


gas and oil to spear. -- to spear. There is the potential for gas in


the Mediterranean. It would be get another one mistake on the part of


Russia. I do not see either country having a real interest in taking


this too far. I wonder how unique this situation is. Two countries


backing the opposite sides of the Serbian war but they are of huge


economic importance to each other. -- Syrian. From the respect --


perspective of most of us, Russia will back President Assad and in


this case to attack Turkish cousins just over the border. It was


careless of the Russians to go so close to the border whether you


accept if they went over it. They were asking for trouble and behaved


with arrogance towards Turkey. The Turks are not prepared to put up


with that and neither is the Turkish president. We should not be


surprised by what happened. Thank you very much for coming in and


talking as through that. The publisher of Hong Kong's South


China Morning Post has confirmed it In a filing to the stock exchange it


says it has received a 'preliminary The BBC understands that Chinese


e-ecommerce giant Alibaba is Mining giants BHP Billiton and Vale


have rejected a UN report which says mud released


in the Brazilian mine disaster A village was engulfed and


at least 13 people were killed when a dam burst at the San Marco


iron ore mine. UN experts earlier said there was


evidence the flood contained "high levels of toxic heavy metals


and other toxic chemicals". BHP though says


the debris poses no danger. Consumer goods giant Unilever


says it will switch to using Its also pledged to stop using


coal for energy within five years. The announcement comes ahead of the


global climate summit which begins in Paris on Sunday - where almost


200 countries will try to agree It is Black Friday today. Ben is out


at an electronic store. It is not curry as in the food. This is a very


unscientific poll about who is shopping today. There is nobody in


the shop he is in. It is not the scenes that we saw last year where


people were pouring in and fighting each other over flatscreen


televisions. He says are braving the coast today, 91% of the people he


has surveyed have said, no. We've only really had one year of Black


Friday. I was going to talk to you about something else. Let us move


on. Let's take a look round the world


at what business stories are making In China stocks have fallen sharply


- closing down more than 5%. Let's get more on this from Rajeshni


Naidu-Ghelani who is in Singapore. There is a series of reasons. If you


are events have shaken the investor confidence in the mainland market


today. First we had disappointing data which showed industrial profits


fell 46% and it over from one year ago. Igniting concerns of the


economy slowing down. 4.6%. And then a crackdown by regulators on


leveraging. And the biggest security firms saw big losses because


regulators said they were investing major brokerages. We know there is


increased pressure on the trading firms since the dramatic sell-off of


Chinese shares in the summer. It is a first batch that would make a


debut next week which will draw more liquidity from the market. Investors


in China have quite a bit to worry about today. Thank you very much.


You have a good weekend. The big drop in Chinese industrial


profits plus the lower value of China's yuan appear to have set


off a wave of selling And the bigger concern is certainly


the potential for China to steadily Also a fairly disappointing range


of Japanese data released today, Europe - the euro continued to


falter, hovering near 7month low. Europe - the euro continued


falter, hovering near a 7 month On expectations that the European


Central Bank could announce further Now in the US the markets have been


closed because of Thanksgiving. Today people will be trying to work


off some of that turkey dinner as they hit the high street and hunt


for some Black Friday bargains. Black Friday is now slowly beginning


to spread around the world with European shops increasingly


embracing the sales day. Here's a little look at what it


means in the US, the UK and China. The United States for Black Friday


as the day before buying is given, it traditionally marked the holiday


shopping season. Last year, 87 million people rushed to the stores


shop online for the chance to save money, spending $9 billion. Whether


you can call it the most famous shopping day is up for debate. Each


year retailers are bringing your sales earlier and earlier to out


competitors. British retailers decided to get in on the act. One


major credit card company reckons we will spend nearly $3 billion in the


UK today. One third more than last year. The question is could this be


the peak, fights broke out last year and some retailers are scaling back.


Asda, owned by Walmart, are not taking part. Here in Hong Kong, the


big day for discount shopping has already passed. China does not


celebrate Black Friday, instead it has what it calls single speed,


we're on the 11th of November, online retailers offer discounts of


up to 70% off regular prices. The online shopping giant Ali Bacher


run-up purchases of more than 14 billion US dollars. Making single


state a much bigger sales stayed on Black Friday.


Joining us is Mike Amey, managing director


James Newman said, the reduction should be 80% for Black Friday, not


25%. It is not worth it, I is spending the day at Chatsworth


house. If you want to know where James Newman as he is at Chatsworth


house. Have a lovely day. The ongoing concerns that Chinese


currency could be devalued, explained to us by the IMF is set to


include the Chinese currency as part of its standard drawing rights in


the Baskett by the 30th of November. What does that mean? The IMF is the


entity that lends to countries that nobody else will lend money. They


are the lender of last resort. It is the question of what cash will be


IMF want to lend to a country. You have to lend them cash which has


value in all markets. They define that as including the standard


drawing rights. Dollars, euros, Stirling and again. The benchmark of


the global trading currencies. Being in that gang is a good gang to be


in. -- the Japanese currency. That is official confirmation you are in


the top tier. The euro is having its worst run in history against the


Chinese currency, what is going on? Is it to do with policy decisions?


The Japanese and the Europeans have been trying to print cash to keep


the economy is going. The Japanese have tempered down their enthusiasm


for printing cash and the Europeans are going in the opposite direction.


As the Europeans start printing more cash and the Japanese hold fire, the


natural response is the value of the usual has to go down due to the


amount in circulation against the yen. We will see that next week. Do


come back. We have got lots of papers to get through.


Still to come we look back at the weeks biggest business


stories, including the biggest pharmaceuticals deal in history.


The US drugs giant Pfizer sealed a deal to buy the Botox-maker


Allergan for $160 billion at the start of the week.


The takeover could allow Pfizer to escape relatively US corporate tax


rates by moving its headquarters to Allergan's Dublin base.


You are with this is live on BBC News. Let us take a look at some of


the UK stories. Earlier this morning, cut-price deals were put


online overnight, Black Friday, we have heard about the expectations,


and our very own Ben Thompson, last week we talked to you. He was in


Salford and now you are in an electric store, Currys, on your own.


What have you done to everybody? Welcome to Brentford and it is Black


Friday, no repeat of those big crowds that we saw last year, you


remember those pictures fighting over this sort of stuff, it was


televisions, laptops, washing machines, to try and get their hands


on some of this. Nonetheless, it is Black Friday so that means that


retailers are trying to get more people through their doors to get


more money through. All of those scenes of people fighting last year,


retailers are very keen not to see a repeat of that because it was not


good for business and Black Friday actually cost businesses money, in


terms of extra security, opening their doors earlier. There is also


the issue of all of those orders that coming at the last minute


whether they can get to people on time. We have got somebody from a


credit card company, what is in this for retailers, because it strikes me


that there is a lot of added cost, do they make money? It is a very


good question, it is yet to be proven as a concept, this is a


concept that came through several years ago. Last year it only read it


came in, it is only going to work if you get value for the customer. The


deals, that you had to wait after Christmas for, we are now seeing


some of those in the period before Christmas. Thank you very much


indeed: More from you later, that is the issue, expected to be the


biggest shopping day of the year, ?1 billion, many people choosing to do


it online, no reports, of websites going down online, more from us a


bit later, I will see you soon. STUDIO: There are more BBC people


down at that store than apparently shoppers! It will be me later. You


are watching business live, Russia is preparing wide ranging economic


sanctions against Turkey after Turkey downed one of its military


jets on the border with Syria, the Prime Minister Dmitry Medvedev says


that the measures will be drafted within days and it could also hit


multibillion-dollar gas and oil investments. Let us get the inside


track on some of the big stories that had been hitting the headlines


this week. Our business editor joins to take us through lots of things,


but we are going to start with the big drug steel, I was on air that


day. We are talking about the maker of Viagra, bought the maker of


Botox. There is a joke there somewhere, we will not


repeat it at this time of the morning. Pfizer is taking over


another one, the Chief Executive of Pfizer remains the chief executive


of the increased size to business if it goes through, and it will be


called Pfizer. But technically it is a reverse takeover, the smaller


businesses actually taking over Pfizer, that allows for this taxing


version which is a key for Pfizer, in terms of the wider deal. It can


move its domicile from New York where the corporation tax rate is


35%, to Ireland where the corporation tax rate is 12.5%, you


do the maths. That is why Pfizer thinks it is so important. Has the


US not being trying to crack down on this? Yes but if it is a reverse


takeover the rules are different? They have tried to tax down -- they


have tried to crack on this type of taxing version, but there is


gridlock between Democrats and Republicans so despite Obama wanting


to rain this in, on what critics say is avoiding American taxes on


profits globally, there has been no agreement about it. But I think


there is quite a high chance that politics will intervene on this deal


and maybe change some of the terms of the deal because the break fee


which is usually put at billions of dollars for this, is only $400


million if there is a political reason why the deal does not go


through. It looks like the deal will not complete until the end of next


year, Hillary Clinton, presidential candidate, has already said that she


does not like the has Bernie Sanders. There is quite a high level


of political risk in the deal, investors are worried about that


because both share prices fell immediately after the announcement.


We did see that. The other big story was the spending review, although


the latest round of cuts are shallower, the British State looks


like it is taking on quite a different shape in the future?


Absolutely there is a feeling that the British economy is growing


faster than expected, interest rate payments on UK debt will be lower


giving George Osborne Finance Secretary some room for manoeuvre.


What was very interesting of course, this has dominated western economies


across Europe, is the question security being so important. The


British government announcing increased funding for the security


services, no cut in the police services domestically. I think it


shows how much, countries like Turkey and Russia, Paris, France,


the UK, the economy is now have to be assessed with the issues of


security and that is dominating really the economic discussion. We


are going to have to leave it there, I'm afraid that we have run out of


time but we will have you on the show I am sure in future as always.


In a moment we will take you through the business pays is but first, a


video that has been doing very well on the BBC website, it is about the


Dulwich picture Gallery in London, one of the first to offer a reality


tour of the collection. The very first visual visitors were young


patients at the nearby Kings College. Take a look.


Della mac it is an art gallery with pictures everywhere, it feels like


you are everywhere. I have been to quite if you are at galleries, it is


quite realistic, you do get the feel of being there and seeing all of the


paintings, it is really cool. It is not as good as the actual thing, it


is not as good as a proper art gallery. You can definitely tell kit


is fake but for a little person they probably think it is the most


amazing thing in the world. That was a very Joe Mattock end to


the peace and you can see many more videos on our website. What other


business stories have been taking the media by storm? We just want to


start with this one, this is in the Wall Street Journal, this is all


about South Korea and being able to do a bit of a U-turn when it comes


to its Asian problem, too many men? That is


right, this is a great story, for a number of years, there is a


challenge of too many men, male births compared to female births,


150 to 120. Thankfully, Korea has led some movements to address that


and normalise things and issue than Korea, if you look at


things like China, the one child policy, if career can make this turn


and great news. And in one generation?


Yes. Speaking of population control, an astonishing story in China daily,


Beijing is vowing control over population growth, 21 million people


and they want a ceiling of 23 million. How will they do it? In a


controlled economy thereof ways that you can do that. In reality, the way


that you do it is that you move parts of the state out of ageing,


whether it be state enterprises, if you say, for any particular


department, it is going to move out, I think that is how they will do it.


People want to go to Beijing because it is the centre of the action. I


don't know how much time we have got. Eddie Jones, joins, he is now


the England rugby coach commie was the Japanese rugby coach, Japan


famously beat South Africa in the Rugby World Cup. He has got a very


big thank you courtesy of the private sector, joining the board of


Goldman Sachs in Japan. If he was short of incentives, there is yet


another want to encourage him. There you go. That is it I'm afraid, thank


you very much. You are going off to a shop to do some broadcasts. Will


you pick me up something. That is it from business live, goodbye.


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