02/12/2015 BBC Business Live


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This is Business Live from the BBC with Ben Thompson and


The war on Islamic State as the UK votes on air strikes in Syria.


We'll assess why coalition forces haven't cut off the terror group's


Live from London, that's our top story on Wednesday, 2nd December.


Coalition air strikes have so far, failed to choke off Islamic State's


main source of revenue, the oil fields in Syria that generate more


We'll look at attempts to cut off the supply.


Facebook founder Mark Zuckerberg and his wife will give away 99%


of their shares in the company to good causes - the stake is


This is how the European markets look in early trade ahead of


eurozone inflation data due within the hour, with prices set to see


The first lady of motor racing will be with us later.


Claire Williams is the Deputy Team Principal at Williams Formula 1 and


she's here to talk fast cars and the highs and lows of the billionaire


Also we want to know what you think of Mark


Zuckerberg and Priscilla Chan's decision to give away 99% of their


What do you think the kid will think when she gets older?


Pressure is mounting to choke off the biggest source of revenue


The United States says it is the best funded terrorist organisation


Later today the British Parliament is due to vote on whether it too


The United States estimates oil revenue generates about $40 million


a month for so-called Islamic State, or nearly $500 million a year.


Jihadists control vast swathes of territory in Syria and Iraq


It is estimated one-third of ISIS' oil revenue comes from fields


But so far security forces have been careful not to irreversibly


damage the sites, so they can be used again in the future.


But Islamic State engineers have been able to repair damage quickly,


and keep the oil and funding is flowing.


So the new goal of the coalition forces is to knock out


specific installations for up to a year, but will this strategy work?


Crispin Hawes is Managing Director, Middle East and North Africa


It is great to have you with us. Let's start on that. I mean, can you


bomb so specifically that you knockout an installation just for


six to 12 months. It sounds like a hard task? You can certainly bomb a


specific installation, recovering that installation, nobody will be


able to tell you when and how they can do it unless you put a reservoir


engineer on the ground after the explosion. The timing of recovery, I


think, is somewhat suspicious. We are talking about the fields that


were once productive in Syria. We are talking about 25,000 barrels a


day against Syria's pre-war production of 330,000, even if they


destroyed the well head installations that are producing


oil, there is still potentially the vast majority of the fields still


ready to be recovered in a post-war scenario. We see it from the air,


images of the transportation, the oil has got to go somewhere to the


buyers, right? We see, you know, vast columns, miles of these tanker


trucks. I'm wondering why they are not more of a target or at least


start looking at the buyers. Who is buying the oil? Well, first of all


the US-led coalition has been in the last couple of weeks bombing the


transport networks themselves. They talked about 116 trucks being hit


the week before last. They are targeting. Of course, that involves


an expansion of the target pool because the majority of people


driving or managing this flow of crude are not members of IS as if


this was a situation that had a membership card, but they are, for


want of a better word, civilians who are associated with the organisation


through trading. So by bombing them, you are extending the target pool


beyond terrorists as it were, to civilians co-operating trading with


them. Who buys the oil? A wide range of people down to civilians in


Syria. The oil that is being produced here is very high sull far,


very sour, heavy crude. It is refined poorly to produce a heavy


diesel. It is then burned in generators across Syria. So when you


cut off this source of revenue to Daesh, you will also cut off one of


the few remaining sources to parts of the Syrian population.


Unfortunately, we're going to have to leave it there. It is interesting


stuff. We will see how this progresses. We appreciate your time.


Five corporate sponsors of football's world governing body


Fifa are demanding what they call "independent oversight" of reforms.


Fifa has been engulfed by allegations of corruption


since US authorities indicted 14 officials this summer.


The letter was sent from Adidas, McDonald's, Coca-Cola, Visa and the


Lufthansa management and unions are to meet today to discuss jobs and


Strikes have plagued the German airline over the last 18 months,


last month the carrier suffered the longest strike in its 60-year


A US court has ordered that the Bank of China pay


a fine $50,000 each day for refusing to turn over information on Chinese


customers accused of selling fake luxury goods.


The bank has been held in contempt of court


and will have to start paying the daily penalty from next week.


The Bank of China is planning to appeal against the fine.


Let's look at the tablet. I think I've got it under control. I found


this very interesting. This is papercuts for Le La scas Rue. Some


-- De La Rue, the issue is plastic banknotes. A number of countries


around the world are considering that. They are hard wearing. They


last longer. They survive a trip in the washing machine. Good news!


Australia has plastic notes. We have had plastic notes for a long time.


We have had plastic notes for a long time. Talking of Australia, did you


do that? You did that! First of all, let's go straight over to Singapore.


Sharanjit Leyl has the details in our Asia Business Hub in Singapore.


Growth better than expected and they think it is down to me, to exports!


Aaron, it is your native land and just like you, it is an economy


that's full of surprises! It grew 2.5% in the three months to


September from the previous year. That was compared to under 2% the


previous quarter and of course, despite the huge slowdown that we


have been talking about, its biggest trading partner is China and you


have got falling commodity prices and exports, of course, all of that


despite all of that, exports actually rose. They jumped about


4.6% in the quarter and this in part actually due to the weaker


Australian dollar which means exporters reaped bigger benefits and


profits when they bring a lot of the profits back home, when the exchange


rate is taken into account. The Australian dollar dropping 9% on


record low interest rates and analysts we have been talking to


saying the effects are unlikely to last as the global economy


many don't expect trade can off set a declining mining investment for


instance. Mining a years, but it is falling as China's


demands start to fade. You were seeing on the screen the


Sydney stock market or one variation of it. Down, despite the better than


expected figures for growth. economic data ahead of what's likely


to be a big month for the US when the long touted, much anticipated


rise in interest rates comes. It was European data that was


more upbeat, dispelling fears that the migrant


crisis could force a sharp spike European manufacturing also came


in strongly, an 18 month So could the ECB's offer some more


stimulus at tomorrow's meeting? Is a rate rise on


Street is watching later today. offering her economic outlook this


Wednesday at the Economic Club in Washington DC. She will be


lawmakers. Investors are going to keep an eye on the latest jobs data


US Labour department due out on course, comes


US Labour department due out on Friday. Most economists believe


companies added 190,000 workers in November. Separately, the Federal


Reserve issues its so-called beige book which offers a snapshot of the


health of the economy and two clothing makers report earnings with


I noticed a big story today, talking of Telegraph Media Group.


I noticed a big story today, talking of Brazil, saying it is facing its


worst recession since the 1930s? Data out overnight suggesting


contraction. India and China are growing strong and Russia, not at


all. The brick story is starting to unravel. It is interesting how that


starts to unravel as the more developed economies, we start to see


the growth. That's right. What is interesting the growth isn't robust.


It is not like we are seeing a big spike in developed economies that's


cancelling out the growth elsewhere. It is all still very tentative, yet


we are seeing a big sell off in emerging economies? In developed


markets, the focus really this week is on the ECB. What they do and


whether there is more quantitative easing, we have got inflation out


across the eurozone today. That doesn't really suggest we are into


the boom times yet in the west. It is going to be pretty flat,


indeed. Lots of stuff for Mr Marrow Draghi to contemplate. Indeed. Are


you going to come back and talk about the papers and talk about Mark


Zuckerberg. We are going to be speaking to the First Lady of motor


racing, Clare Williams, the deputy team principal of Williams. She will


be here to talk about fast cars and the highs and the lows of the


billion dollar industry. You're with Business Live from BBC


News. Morrisons is about to fall out of


the index. It has gone. Out of Britain's top 100 companies. It is


one of the victims of the regular shake-up. Victoria is looking at who


is in and who is out and why any of this matters. She is in Salford.


Vic, talk us through where are we, who is in, who is out? Good morning,


boys. This is the FTSE 100, it is the 100 most valuable companies that


are listed on the London Stock Exchange and every three months or


so they take a look at this list and they try and work out whether or not


it actually represents all the companies true value. So at the


moment we've got three that come out and three that are looking like


they're going to come in and Morrisons is one of the ones that's


going to be dropped and it matters because both big and small investors


alike. Well, they are keen on something called tracker funds and


they buy a little proportion of each and every company listed on the FTSE


100. So if you fall out of the list, lots of investors are going to sell


your stock. Listen to this. This is a markets experts and she z this is


what she thinks it means for a company like Morrisons. When a


company loses its place in the elite list that makes up the FTSE 100,


they stand to lose a bit of market value. The other thing that happens


is a lot of fund managers, a lot of tracker funds which are products


that track markets such as the FTSE 100, and they look to replicate


every single company in that market by buying or selling it, now if they


know that a company is going to fall out of the index, they will sell


that company and that's going to weigh on the share price which is


the last thing a company like Morrisons needs right now. Of


course, once you're out, it is difficult to get back in because the


value of your entire portfolio has fallen and this is not good news for


a company like Morrisons. We heard today from the British Retail


Consortium that prices had been falling for 31 consecutive months.


If you do the maths, that's under three years of prices falling. Not


good news for the supermarkets because they are struggling from


online, people buying their shopping online and also from big supermarket


price wars as well. It says a lot that a company like Particled Pay,


an online payments processor is joining.


Thank you. From the boys in the studio to the girl in Salford,


goodbye. A quick look at the stories. England cannot build enough


homes. You're watching Business Live,


our top story. The British parliament is expected


to give its backing today to UK air strikes directed against


Islamic State militants in Syria. The pressure has been growing


on coalition forces whose air strikes have, so far,


failed to choke off Islamic State's main source of revenue, the oil


fields in Syria that generate more Staggering amounts of money. Stay


tuned to the BBC for full coverage of that vote taking place later.


That's how today's guest describes the powerful, multibillion dollar


and often dangerous world of Formula 1 racing.


Probably the most powerful woman in the world of motor racing


at the moment, Claire Williams is deputy team principal at


She is the daughter of Frank Williams, founder


Despite her connections, she had to fight to get to the top.


After graduating with a politics degree,


she started out as press officer at Formula 1, eventually moving to


a job in the communications team at Williams, despite her father's


disapproval, where she then spent the next decade working her way up.


Williams is one of the world's leading Formula one teams coming


in third in this year's Formula one constructers' championship.


While it's a sport that generates more than a $1.5 billion a year


in revenues, it's a tough industry to be a part of.


On average, a team needs an income of at least $350 million to have any


realistic hope of winning races, so, unsurprisingly, some smaller teams


And, guess what? She's here. Great to have you with us in the studio.


We want to start knowing more about too. I know what we just said but


many people would say, the child of somebody who owns the company, they


are in a good position, handed to you on a silver platter. The truth


is, your dad didn't want you in the company. They didn't, neither of my


parents did. So it was an interesting start for me in life.


Neither of my parents wanted their children to have the expectations


they would one day take over this amazing Formula one team. They


wanted us to make up own way in the world and that is what I wanted to


do anyway but life didn't really take that course for me. What does


the job involve? There is a tendency to think of sport is something that


doesn't need to make money or be commercially successful but it is


that. You have to generate revenue, otherwise the team doesn't make


sense. We are one of the few independent teams in Formula one 's


so what keeps us going is the money from sponsorship and the Formula one


organisation. My dad was very successful, he did that 40 years, he


has kept the team racing through some of the greatest partnerships,


and my role is to get the money in. Who does the money come from? So, we


have about 20 partners in our community of sponsors, ranging from


the likes of Martini, who joined us at the start of last year, then the


second-largest resourcing company in the world, we have a whole raft of


partners which means we can do what we love to do. That is their


generosity but what about the impact of the actual races themselves? Am I


right in saying that apart from Monaco, every other country you have


to pay to host Formula one. What is the economic impact on that


community, that economy on each of those countries? At obviously costs


a lot for these countries to host a Formula one race but you think about


the number of people that go and watch every Grand Prix we racing, we


have next year 21 races on the calendar and invariably for a lot of


countries Formula one is the jewel in their crown. You can imagine how


many people are staying in hotel rooms, going out to restaurants in


the evening to eat, and all the other economic benefits that can


bring, having 100,000 people coming watching your race. What effect does


money have no sport? You have some tough opposition against other


teams. Is there a direct correlation between funding and success? I


think, as a team, we have always proved that we can, on a much


smaller budget, beat the smaller -- beat the bigger teams. We are seeing


in Formula one nowadays the costs of going racing escalating


significantly and is now looking at the Sadie 's who have won the world


championship, they did that on at least 300 million sterling, not


dollars. We are operating on 110 million sterling this year. Money,


of course it is important. It has an impact on success but it isn't


everything as we have proved in the past. It is about what you do with


your money. It is like any business with the right people in the right


jobs, that is going to drive you toward success. Are you a car lover?


A petrol head? Yes, I like cars. I like somehow fall road cars, brute


cars. That's the great thing about Formula one. These amazing machines,


the most technologically advanced machines in the world, designed by


some amazingly bright people, and these heroes that get into them and


drive 300 commenters are now every Sunday, it is a sport I love. Have


you ever driven one? Net-mac, my dad would never let me. It is about the


brains and money of the operation. My driving skills are not up to


much, I'll stick to the road. He said there are 21 races. Anything


happening in the development of F1? Any exciting developments for next


year? Next year, it is status quo, but Formula one is fantastic and we


have some amazing races, but 2017 is the evolution of Formula one where


we will see some amazingly different race cars, very futuristic, lovably


to be five seconds a lap faster than they are. New tyres, new engine for


Miller, said 2017 is the year to look out for. One to watch. Really


good to see you. Thank you very much and good luck for the next one.


In a moment, we'll take a look at that Facebook story, but, first,


as part of the BBC's 100 Women series, we've been meeting young


Melanie Goldsmith's mantra is "You're only worth what someone will


pay", how her alcoholic sweets are being


My biggest moment of joy was hiring our first full-time employee.


And they've come out of nowhere, you know, they're not


We make deconstructed edible cocktails,


Business success is so encompassing and who's behind it.


My name is Melanie Goldsmith, I'm 26 years old, I am the Director


How about this for generosity? Mark Zuckerberg and his wife, they have


pledged to give away the vast majority of their tech giant to good


causes. They made an announcement in a letter to their new daughter.


The couple say they will give away 99% of their shares to causes


which advance human potential and promote equality.


At the moment, that share value equates to about $45 billion.


The couple say they'll give more details on the donation when they


Well, certainly Mark's case. Maternity leave for Priscilla Chan.


Our tech guru is here with us. I'm wondering if this raises the bar in


terms of philanthropy and all the other billionaires in the tech


world. I think it is obvious from the letter. They put this letter on


Facebook. Somebody said to me, following Mark Zuckerberg on


Facebook is like following any of your mates. It is like they are on a


gap year, go around the world and do stuff, talk about their philosophy,


then post baby photos. The differences he has used the platform


in a different way, expressing what him and his wife want to do with


their money, which is to give it away. There is a reply at the end of


the letter from Melinda Gates from the Gates foundation and praising


what they want to do. The Gates foundation is a big contributor to


health and education charities. Mark Zuckerberg and Priscilla Chan have


now had to decide how that money is going to be spent. Not all in a


rush, it isn't going to be sold immediately but over many years.


James, this is interesting because you had to be 70-75, you are a


billionaire, you gave away your fortune. Now you're doing it in your


mid-30s. He is the first of his generation. It puts pressure on his


rivals in Google and other big tech companies we have had some follow


the wake of Bill and Melinda Gates. One point, I've just looked back on


interview I did with Mark Zuckerberg in 2000 81I told him he was idiot


not to have sold up the year before. Why are we even talking to


you? Last year, Facebook paid in corporation tax $7,000. That was


it. They posted a loss of 28 million. We won't get into that. It


is legal, some people are raising that. Nice to see you, gentlemen.


That is it from us. Same time, same place tomorrow. Goodbye.


Dry and mild, wet and windy, light and


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