09/02/2016 BBC Business Live


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This is Business Live from BBC News with Ben Thompson


As the biggest mining conference in the world gets


underway today in South Africa - the big players are there -


what will they decide at this critical time?


Live from London, that's our top story on Tuesday 9th February.


Digging deeper - leaders from the world's top mining


companies gather in South Africa as their industry faces its biggest


Also in the programme, more market turmoil as jitters


about global economic growth batters Japanese stock markets.


Investors across Europe are on alert - we'll make sense of the turmoil


connecting with our teams in Asia and on Wall Street.


And there's been another big selloff on global markets -


we'll get the expert view on all you need to know.


And we'll be getting the inside track on one African


company that's riding the commodities rollercoaster


and finding fertile ground to grow a business.


And as the UAE appointed its First Minister of happiness, we want to


know what other government jobs should be created. What do you want


to be a minister of? Let us know. We're starting with commodities


today as the global It's down to a slowing world


economy, not least China, where demand for


commodities is falling. As the biggest mining conference


in the world gets underway in South Africa they're assessing


the jobs cuts and falling You can see here just how


the price of copper, gold and platinum all fared


in the last 12 month. The industry has had


to dramatically cut costs. South Africa - the world's largest


platinum and manganese producer - could lose as many 32,000 jobs,


according to the country's mining Not welcome news when


the unemployment rate And mining firms have had


to make huge write downs. South32, the mining group spun


out of BHP Billiton, plans to write down $1.7 billion


on the value of its assets everywhere from Australia


to South Africa and Brazil. And it's also had a knock-on


effect on currencies. As commodity prices slid in 2015,


so did the currencies of most of the commodity


producing countries. Take Brazil's Real, down 33%


and the South African Rand, But one mining executive says


there are opportunities to be had. Like everything in this modern


world, there is always opportunities now to reposition, consolidates.


These are times when new companies emerge, a new bunch of


entrepreneurs, people with different ideas. That is the marvel of


capitalism, when it is broke, there is always somebody who will come and


fix it. That was Mark Bristow, the chief executive of one mining


company. Neil Dwane, a mining analyst


from at Allianz Global Investors, Nice to see you. Mark has reason to


be cheerful, his company is doing very well. Does he have a point, in


this type of environment, that is how capitalism is? There are great


opportunities to be had? Yes, and I think because he is in the gold


sector and there is little additional supply, he is in a unique


position. If you are in the iron, copper or coal markets, like most of


South Africa, you are computing in a global environment, your currency is


very important to the competitiveness of your product. He


is kind of saying, these are not my problems. We would expect the strong


to get stronger. He is the boss of Arundel mining, he has been on this


company many times. South Africa is in a particularly difficult session


and in Cape Town, where the mining embargo is happening at the moment,


it is very much on government minds that they get the right sentiment


and the right deals during the conference? What we have seen in 20


years has been a global boom in mining, people have not had to worry


about making themselves attract because they wanted to supply China


and the rest of the world with resources. Now the world has


changed, it has become competitive. Many of the companies and many


people like Mark Bristow, who are investing, with thing, what would


Brazil or Australia offer us? They had to find the right balance


between social stability and employment and making their economy


attract for inward investment. I discuss job losses, the cuts in


investment and the effect on mining firms. Will there be much sympathy


for mining firms? They have had it so good for so long, we have seen


record prices of most commodities in the last decade. You might say they


should put rain away -- money away for a rainy day? Most companies have


been well resourced, but the challenges up until 18 months ago


were, of course, with the difficulties everybody wanted their


share of the pie, the government, employees and shareholders all


wanted it. But it now transpires that was the top for the industry


and there is not enough money to go around. Capitalism in theory has a


destructive as well as a creative side, when you build assets lasting


25 or 30 years you can change your mind once you have made it, you are


stuck with it for the disabled future.


It is long-term investment. Thank you so much for coming in and giving


as your opinions. We have a team in Cape Town, so when we hear anything


more, we will tell you. Global markets have fallen


again on persistent fears In Japan the main market -


the Nikkei 225 - was down Shares in Australia


are also down nearly 3%. It follows heavy losses


on Wall Street and in Google's chief executive


Sundar Pichai has become the best Last year, he earned stock


options worth $199 million, taking his personal stake


in the company to $650 million. Mr Pichai took the position as chief


exec as part of the company's A public inquiry into fracking


in the North West of England opens today after Lancashire Council


rejected proposals by energy firm Cuadrilla to drill for shale gas


at two sites in the county. But with oil prices falling,


experts say the venture won't be In the US, many fracking companies


are still struggling to make money with oil prices


at just $35 a barrel. Lots of stories on Bbc Business Life


online. This is a bit more detail on how things went in Japan. A very


unusual day for market in Asia, most of them closed for the lunar New


Year break. Only Japan and Australia were trading, they make a close down


5.4% lower. Among the big losers were the big financial companies.


But also clashes in Hong Kong as part of the lunar New Year


celebrations, some local vendors decided to sell goods and did not go


down well. As our Hong Kong corresponded points


out, normally they would turn a blind eye to illegal traders in the


streets, but this year they are getting tough and have cracked down,


which sparked protests. And just a reminder, we want to know


whether you have any thoughts about what government ministers should be


created after the United Arab Emirates -- Emirate created a


Minister for happiness. One said that he wanted a Minister for


slashing and burning this size of government! Ministry without


portfolio! Keep your comment is... Comments coming in at BBCBizLive.


Our team in Singapore is looking at the twists and turns in Asia. Tim,


tell us more about what went on in Japan? Virtually no share was


unaffected as the benchmark Nikkei plummeted. It reflects broad


concerns about the local economy, banks and rock ridges copied a


severe beating. It also has to do with the yen, which investors tends


to buy as a safe haven in times of uncertainty, today it went to its


highest level since the -- against the dollar since 2014. Japanese


government bonds were affected, yields sinking below zero for the


first time. Much of the region is closed for Chinese New Year, but the


indexes that are open tended to follow Japan peers lead and also


fell, Australia, Thailand and the Philippines all closing down today.


The Hang Seng is closed, the Nikkei file.


-- fell. Those persistent worries in Europe about the global slowdown are


affecting markets. A lot of debate about whether it is founded in any


reality or if it is just the usual knee jerk reaction to any little bit


of information? We will assess that in a moment with our guest Jeremy,


that first what will make headlines in the United States?


Let's get the latest from the US markets with Michelle Fleury.


Wall Street will be jittery on Tuesday morning after the near


router which took place on Monday, at one point the Dow Jones was down


almost 401 points. Will betide any company that reports disappointing


earnings, and there are lots of companies to look out for this


Tuesday, among them Coca-Cola, which reports its full-year profits.


Strong sales in the US are expected, but so is some weakness overseas


caused by, you guessed it, the strong US dollar, the culprit that


keeps coming back to haunt American companies. What Disney will get its


first chance to feel the force in its accounts, I am talking Star


Wars. Its first-quarter revenues are expected to get a boost from the


latest Star Wars film, which took record amounts up the time of its


release. The force continues to awaken!


Joining us is Jeremy Cook, chief economist at World First.


Jeremy, what a 24, 48-hour with yet again? A really, really bad start to


the week. We thought with the lunar New Year, China being closed and a


very good jobs number at the US on Friday that things on Monday morning


would be quieter. After about an hour it just continue to get worse


over the course of the day. The year of the monkey, I was talking to a


colleague in Singapore, he said people are saying that the year of


the monkey means volatility, lots of bugs and downs, twists and turns, it


is happening? What is interesting yesterday was that the focus was


firmly on the banks, particularly on Deutsche Bank. What is going on?


There are lots of hallmarks of 2008? European banks were in focus,


Deutsche Bank were right in the cross hairs. Investors might be,


rightly or wrongly, believing they might not be able to repay some of


their more volatile that is. We know the European banks in the UK have


been hit quite hard from a litigation point of view over the


last couple of years, income is also quite low at the moment, people are


looking at the balance sheet is and going, can they stay in this? Hence


the fears yesterday. Jeremy will look at some of the stories in about


five minutes. Fertile ground to grow a business -


African mining giant Cominco makes its money mining phosphates


used around the world as fertiliser. We'll ask how easy it is to do


business in Africa - and how technology is changing


the way they operate. You're with Business


Live from BBC News. Let's focus on the UK housing


market. Housebuilder Redrow says profits


jumped 14% in the last six Chairman Steve Morgan says


it was an outstanding six months. Joe Lynam is following


this story for us. Joe, we are all struggling with


rising house prices but, once again, good news for those who build them?


Pretty true. They are one of the big house-builders in the UK, Redrow,


they had a record set of profits for the financial quarter we have just


had, around ?104 million in pre-tax profits. They said they completed


2178 homes, the completions are really important because that


indicate how many homes they are able to build. In written it is a


lot to do with planning permission, getting the land, getting it


approved and developing a -- in Britain it is a lot to do with. The


boss says he faces the problem of skills, getting the brickies,


plumbers and construction experts on site to build these homes, as well


as getting the land approved. Then there is the issue of affordability.


There is a report from the Lib Dems political party claiming that the


average price of a property in the UK by 2032, and we will all be a


good bit older, will be over ?1 million. It is around quarter of ?1


million now. It gives you an idea of how expensive properties will be. I


spoke to chairman Steve Morgan today, he says the demand is huge


and he can see the affordability issue coming into play for his


company yet. This chart shows you that the company has done pretty


well over the last year, but so have many home-builders as the helped to


buy scheme comes into play. So you might think we are headed for


a recession. The signs certainly suggest in some respects that we


could be, but Goldman Sachs, the US investment bank, says no. There is a


near zero risk of UK recession. This is a story in The Telegraph this


morning. And it says, "Well, the stock market and credit tremors are


sending off false signals." The Goldman Sachs report talks about the


fact that the UK economy in the developed world at the moment is one


of the strongest economies in terms of the fundamentals and how the


economy is performing. So some positive news about the UK economy


from Goldman Sachs. Global economic jitters fuels


the worldwide sell-off. We look at the damage being wreaked


on the mining industry. Now, we've talked already


in the programme about the slump The African commodities giant,


Cominco, is making money from mining And it's in demand from


the agricultural industry, but can only be mined in the US,


Africa and the Middle East. But with supplies in the US


dwindling, and the Middle East frequently rocked by political


tensions and security issues, Africa is the main


focus for the firm. He's the Chief Executive


for the African Company, Cominco that operates


in the Republic of the Congo which neighbours the


Democratic Republic of Congo. It is important we get that bit of


ge geography right. You are from Australia slam and this particular


company has been around for six years and it is specific to what


you're doing in that part of Africa, but your history is mining in


Australia, isn't it? Yes, I've built five mines in Australia and saw that


the opportunities in Africa were much bigger and greater. So just


tell us about your, how you dot to this point where you are now. I


understand you were given a map and from that map, you kind of figured


out there might be this massive phosphate opportunity... You're


right, Sally. Talk us through it? Well, I was shown a hand drawn map


six years which had a couple of dots on it where phosnate was known to


occur. I thought if this is one large deposit under soil cover, it


could be 50 kilometres long. The chances of that doing the case, are


fairly slim, but it turns out to be true. We have used some amazing


technology, built big databases using this software and able to


quickly and cost effectively prove up the largest deposit of phosphate


in the world. So in a six year period, since getting that hand


drawn map, you have invested $50 million already? Yes. And now you


are at the point where you can start digging up the stuff? Yes, that 50


million, it sounds like a lot of money and it is, but for what we


have got for it, it has been cost effective because we have done so


much hi-tech work and this is the key for modern exploration and mine


development now. It is big science and we've used this software to pull


together satellite data, remote sensing and we have done aerial


surveys which culminated in a precise geolocation. The first drill


hold hit deposits and we have got the biggest deposit in the world. We


look at pictures and we think of these huge mines with big mining


machinery. That's changing and you're able to be more clever about


how you do it. A long time ago, minerals occurred on the surface.


These days, all major, there is few new discoveries of minerals because


they are concealed by soil cover. You need to narrow the search using


technology and if you try to find a worm under the field by sticking a


knitting needle in the soil hoping it could come up covered in blood,


you could wait a lifetime. We use imagery to look for geological


structures and when we fin those we do surveys, the geophysical means


can narrow the search down so by the time you come to do the expensive


groundwork, you already know what you're looking for. So you've got,


you know it's there, you've got the investment, you're a private company


getting on with this, but you have to work with the Government, don't


you? And you're going to create a village, becauser' going to hire


1,000 people from the region, some of whom have never had That's


On tomorrow's programme, Arnaud Vaissie will be here.


He's the co-founder, chairman and Chief Executive


of International SOS, the world's largest medical


It provides medical and security services to staff working overseas


He'll give us his take on the changing political


and security landscape around the world.


The travel group TUI says Turkish bookings have slump by 40%


for this summer after the terror attacks in Turkey,


Travellers are instead switching to less risky destinations


Tui normally reports a loss in the winter months and makes most


of its money in the summer, but in the last three months of last


year it actually saw growth, as travel expert


Egypt, and you could say the same about Turkey, a number of these


destinations that have really come to prominence, a lot of investment


into good quality hotel stock. So, they are a cheap destination for


winter sun and a company like Tui need those destinations. For those


destinations to be shutdown like Tunisia and Egypt or to suffer a


drop of the kind of scale that we have seen in Turkey, 40% down,


that's a huge drop. Let's take a quick look


at the stories making business The Wall Street Journal looks


at tech firms like Apple, Alphabet current push on technology


that turns phones into digital keys. The National reports


on the latest government shake up by Sheikh Mohammed bin Rashid,


the ruler of Dubai, to prepare UAE It includes a Minister for


Happiness. The Guardian quotes the UK's


Transport secretary saying new runway will be built


at Heathrow or Gatwick by 2030. The Telegraph reports


Goldman Sachs' latest assessment of the UK economy saying the country


is unlikely to face a recession Jeremy is here. A Ministry of


Happiness? A fun place to work. Bean bags and sweets for everyone. It


sounds Harry Potter. The Ministry of Happiness and minister of happiness.


They have pioneered something talked gross national happiness as a way of


seeing how the economy was looking and maybe this is a Harkining back


to a more sentiment driven economy. We were asking you for your comments


and you were suggesting a Minister for Speech. I was thinking about


that, but I wasn't going to say it out loud. Now we have been outed.


Wall Street Journal, tech world pushed towards a future without


passwords. This would be fantastic. It drives me around the twist. We


have to change ours every three months. It has to be lower case and


a number. It is all the retailers, you maybe using, and all the clubs


your kids are in and all the different things. It goes on and on.


It happens as a kind of waterfall when you change devices, if you get


a new phone, you get a new iPad and you have got to look into your


Twitter, your Facebook, your John Lewis account, your Sainsbury's


account. How will it work? Some phones, the newest iPhone, my new


Sony, it is about the fingerprint. Does it work though? It does. Mine


doesn't work. I have got a smart device that's supposed to recognise


by thumb and it doesn't. What's wrong with your thumb? I do too much


washing up, I think! A new runway, where will it be? It will be built


by 2030, but that's so late. We are falling behind in the ranking of


super powers. There was an interesting article over the weekend


about how Istanbul is likely to become the new Dubai as far as a


hub. We know how many flights now go through Dubai if they are going into


Asia. The UK continues to sit there and not build then we're not going


to be challenging that any time soon. Injury ram yu, thank you for


being on the show. Good to have you with us. That's it from us. We will


see you soon. Bye-bye. Hello there. Good morning. In those


areas are that clearing up after Storm Imogen yesterday, today should


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