25/02/2016 BBC Business Live


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This is Business Live from BBC News with Ben Thompson and Sally Bundock.


Sales at brewing giant AB InBev lose their fizz in China and Brazil


as economic worries force consumers to cut back on beer.


Live from London, that's our top story on Thursday 25th February.


Profits are not as frothy as hoped from the world's biggest


It's been hit by economic woes in Brazil and China.


So will its mega takeover of SABMiller help it thrive again?


Japan's struggling electronics firm Sharp is rescued at last,


but Foxconn of Taiwan is an unlikely white knight, and it marks the first


foreign takeover of a major Japanese tech firm.


We'll hear from our correspondent there.


And, the rollercoaster ride on financial markets continues.


Today we are seeing gains across Europe but the pound


We'll have more on our globe-trotting mission to find out


how Britain could fare outside the EU.


We'll head to another island, Singapore, to find out what the UK


can learn from this small but mighty Asian hub.


And what's the toughest question you've ever been asked


It's reported that Facebook asks candidates, what did you do


Send us your best and worst interview questions.


The world's biggest brewer AB InBev warns economic challenges in Brazil


The maker of Stella Artois and Budweiser saw profits rise


by 6.6% to $4.31 billion in the latest quarter.


It's on course for a $106 billion mega takeover of rival SABMiller,


which owns Grolsch and Peroni, a big shakeout of the industry


But even with a slowdown, China is already the world's biggest


beer-drinking country, guzzling a whopping 47.5


Well ahead of the US, in second place with 17.7 billion


Established brands, like Budweiser, are being challenged


by the craft-beer phenomenum, as the micro-brewery craze spreads


from Europe and the US to China, Brazil and Russia.


Craft makes up not even 0.5% of the total beer market.


Jonny Forsyth is global drinks analyst at Mintel.


Sally running through the issues, what I want to pick up on is they


blame the slowdown in China and Brazil, it is a common complaint, a


lot of businesses warning that the slowdown is hitting their bottom


line. Is it fair, as an excuse? No, because they have small coverage in


China. A China slowdown is not good but it is not necessarily a


disaster. It points to how reliant these brewers are on the emerging


markets. We have talked about those markets and what growth potential


they give to big firms. With a slowdown they are looking for


alternatives, where are the alternatives? The big one is Africa.


So much potential growth. It is a continent where a lot of people like


to drink beer, huge potential to bring people into a retail market


who have not been in before. Craft beer is a big issue. It is funny,


because we see that beer companies are getting bigger, but they are


telling us it is all about Craft beers. They don't seem to go


together. There is a disconnect. It is a threat for the company. It is a


long-term threat. It is more of a bubble in Western markets at the


moment, people are turning against big brands, but in a decade or so it


will be a big problem in emerging markets as well. We can see by the


big firms are doing it, they make efficiency, the bigger they get, but


that is the thing that consumers do not want, they want local beers,


craft beers, they are not necessarily getting it from the big


firms. But not everybody drinks Craft beer. It may have amazing


growth potential, but even in America it is still only around 11%


of all beer sold. It does have exponential growth, but a lot of


people are interested in mainstream beers as well. What does it tell us


about the power of marketing? They are huge conglomerate but they are


trying to portray an image of a niche luxury brand. It is the


marketing. It shows the susceptibility of consumers to


lifestyle marketing. A lot of these major brands, there is not a lot of


difference in taste but it is selling a dream of how people like


to see themselves. It has worked well in Western markets, and it


works in emerging markets as well. French authorities have demanded


Google pays $1.7 billion The figure is substantially more


than the $180 million the search engine agreed to pay in back


taxes to UK authorities. But reports suggest Google


is to negotiate and may not pay The IMF says the global economy has


weakened further and is vulnerable It says that's a result of increased


financial turbulence The IMF's report comes before


a meeting of G20 finance ministers and central-bank governors


in Shanghai later this week. The South African rand has slumped


further after the country's finance minister warned the


economy is in crisis. Pravin Gordhan cut the country's


growth forecast, warning that the economy is struggling


with shrinking growth, 25% unemployment and


widespread poverty. The South African currency has


halved in value over To Japan now, where struggling


electronics giant Sharp says it has accepted a takeover


bid worth $4.3 billion from the Taiwanese


multinational Foxconn. We will talk about BT, they are


subject to a review from the regulator. The result was sent


through this morning, they must open up its network to competition, but


the regulator has stopped short of demanding a full spin off of the


Openreach broadband business. Lloyd say profits are up 5%. A 9% stake


owned by the Government as a result of the bailout in the financial


crisis. Profits are up, but it is putting in provision for mis-selling


of PPI, largely in the UK. That is costing the big bounce the -- the


big banks the. Shares are up 9% in a moment, we


will explain why. To Japan now, where struggling


electronics giant Sharp says it has accepted a takeover


bid worth $4.3 billion from the Taiwanese


multinational Foxconn. Foxconn is the biggest


supplier to Apple and makes, It's the biggest foreign buyout


of a Japanese firm in its Shop has been struggling for some


years with massive losses and it has been cutting thousands of jobs, so


it has been looking for a saviour. It had two options, one possibly


Japanese state backed fund and the other was Foxconn. Many people


thought the company would go with the Japanese fund, because the


industry is known to be reluctant to accept foreign takeovers. But


Foxconn's offer was more attractive, double the amount, and the board


accepted it. The company will raise more than $4 billion by selling two


thirds of its shares to Foxconn. The deal still has to be approved by


shareholders, they are not impressed, shares were down 20% at


one point, they ended the day 14% lower.


Sharp's shares fell significantly. They closed down over 10%. But Japan


is up, on the speculation. The Government will do more to boost the


economy. Elsewhere, a mixed picture. The market up slightly in the US.


Lloyds Bank shares up 9% on the FTSE 100. That was after announcing the


earnings, which were pretty solid, and they announced a special


dividend, which is good news for shareholders. Therefore, people


would buy the shares. We have trouble showing give those numbers,


but when we can bring them to do, we well. Also, Zodiac aerospace, shares


down 34%, it issued a profits warning. Maybe we will get the


European numbers in 80 minutes, but in the meantime, this is what is in


store in the United States. It is earnings season, we will hear


results from a bunch of companies, including many retailers, including


cols. They said their sales and profit were hurt by unusually warm


weather during the holiday season. Likewise, Sears is expected to


announce the loss, and Weight Watchers International seems to have


been boosted by Oprah Winfrey, who signed on as a stakeholder and


spokesperson. The company is coming off 11 straight quarters of


declining revenue. The commerce Department's durable goods report


for January is due out. The numbers will be pored over for signs of the


sector's resilience. These are the European numbers, they


are green. Joining us is Lawrence Gosling,


editor-in-chief of Investment Week. A lot of financial data due today.


Eurozone inflation, what are we expecting? Not a large number.


Things are muted in the Eurozone, as most people would expect. Syrup with


one, 0.2%. When you strip out the energy and a bed, prices go up by


around 1%, but because energy is going down so sick of the conflict,


it keeps pulling the number down. Absolutely. People looking for


inflation as a positive sign of economic growth, that 1% number is a


good sign that things are gradually going in the right direction. Let's


talk UK. It is the second estimate for the first quarter of GDP, it


should give us an indication about a slowdown in the world economy are


born out in the figures. We are not expecting a very large number, it


will be positive, which is good news. The sign of weakness that


people will look at, retail sale is beginning to drop off, which might


make people nervous. It is interesting, the IMF is all over the


business pages today, various comments coming from Christine


Nygaard. One of their suggestions to global Finance minister's and


central bankers meeting tomorrow in Shanghai is, club together, let's


come up with a strategy to help the global economy. Your thoughts? She


has argued for an coordinated approach, but that is whistling in


the wind, because the economies are moving at different speeds. You


cannot get the central banks or the finance ministers getting their


heads together, because they cannot do the same thing. I would like to


be a fly on the wall, especially with George Osborne and Mark Carney


there, given the whole scenario of Brexit. Yes, that will dampen growth


a bit in the next couple of months. We had Mark Carney teasing the


market about interest rates, suggesting there could be a cut,


which is an interesting scenario to play with. You will be back later,


we will look through the papers. Still to come, can the UK thrive


outside the EU? As the debate continues as friend of


the referendum, what can Britain learn from Asia's trading hub


Singapore? More about the UK telecoms regulator


of calm, just told BT to open up its cable network to allow competitors


to connect more homes and offices to superfast Internet.


Openreach provides and maintains the cables that deliver connections into


consumers' homes but the regulators stopped short of demanding a


complete rake up of BT. Some damning comment from the


regulator, not least about the so-called jewel divide. Absolutely,


a big point in this report is this notion of a digital divide. Fast


swathes of Britain do not get the service that people in the big


cities enjoyed when it comes to things like superfast broadband and


mobile. This morning's disappointment for BT's rivals, they


say the way to solve this divide problem is to break up BT. Relief


from BT itself that Ofcom has not gone the extra mile and said that BT


should be broken up. If you look at the share price, investors in BT


pleased that the Chief Executive has not gone as far as many expected her


to go, she says there has to be proven, the share price affected by


the volatility at the beginning of the year, and it has picked up this


morning. The Chief Executive of BT has said they will improve the


service, but has also said that investment depends on certainty.


Ofcom has said, yes, the voluntary agreements will still be in place,


they must improve, but break-up is still on the table. Although there


is this major report, they are still saying that at the moment BT can try


to keep its own house in order, but if it doesn't, break is still on the


cards. Investors will still have that concern to content with.


Thank you. Good stuff, as always. Now have a listen, and watch this.


WHISTLE. Don't you just love it? This is Britain's most famous steam


train, the Flying Scotsman, setting off this morning from King's Cross


heading to York. Thousands of spectators expected along the 200


mile route. It was built back in 1923.


Our top story: Challenges brewing for the beer industry.


The maker of Stella Artois and Budweiser, AB InBev,


see profits hit by economic problems in Brazil and China.


We have been discussing whether it is fair to blame that slow down when


they have small exposure to those markets but it is a common excuse we


are hearing from many firms with falling profits, the slow down in


China. As the UK contemplates a possible


life outside the EU, there have been a number


of scenarios of what could happen One theory suggests it could become


an Atlantic Singapore, an outward-looking trading nation


with a large financial sector. Our Asia Business Correspondent


Karishma Vaswani looks at what lessons the UK can learn


from Singapore's success, From third World to first. In just


50 years since independence, Singapore has turned into one of the


world's richest cities. Not too long ago this was a sleepy fishing


village. On the banks Indian and Chinese merchants used to haggle


over goods but now the icons of global finance tower over the


horizon. Trade has always been at the pulse of this place. This


transformation has not been repeated anywhere else in the world but


Singapore's leaders knew that this tiny island could not survive by


itself, so it has used its neighbours to chart its own course


of success. Just look at where Singapore is in the region. A tiny


dot in a sea of bigger, more powerful countries. That is why in


1967 it was one of the founders of the association of Southeast Asian


nations also known as ASEAN which is now an economic block of ten member


states. They have also signed 21 free trade agreements with everyone


from America to China. Looking beyond its shores is what has helped


Singapore thrive according to the boss of the country's largest bank.


S benefits enormously from the free capital and Labour movement. Frankly


I don't think Singapore would be able to survive let alone thrive


without access to this. With a small population, this country has looked


elsewhere to fill its workforce. Today four out of ten people here


are foreigners. This has brought with its own problems and the


Government is trying to address them, but Singapore can pick and


choose who it wants to let in. If you look at the situation in


Singapore and in ASEAN, they have a single market. Not as deep as


Europe's but there is a free-trade agreement that covers almost all the


trade within ASEAN's borders but there is no free movement of labour.


There are efforts to introduce it in some skilled professions but they


have not gone very far. In a sense, Singapore now has what Britain


wants. As you have seen, Singapore has benefited from being part of the


ASEAN grouping. It has been able to sell its products to its neighbours


and make use of the workforce in the region. Although ASEAN certainly has


its limitations, at its core there is a belief that member states


should not get involved in each other's business and currently that


is an option the UK does not have. From Singapore to Iran,


and one of the biggest deals Tehran has made since sanctions


were lifted has been to upgrade its aging


fleet of aircraft. The opening up of Iran's economy


helped seal the $25 billion It includes 45 A330 jets and 12


A380 super jumbos. Speaking to the BBC's Theo Legget,


Airbus's chief executive says financing is an issue which needs


to be resolved for the What we concluded as a first aid


agreement, memorandum of understanding, and in our business


you need a purchase agreement to fill it up. When you have a purchase


agreement, predelivery payments flow, so yes, we hope to get this


agreement, this memorandum of understanding into a firm purchase


agreement in the coming months. Financing is obviously one of the


big issues we have got to deal with. So where is the money coming from?


This is what we are currently discussing. A lot of other companies


and industries are in the same situation. This is not easy. I am


hopeful that we will find a solution but we will nevertheless comply with


all the restrictions and sanctions and regulations that are still in


place with respect to Iran. The boss of Adas there. Let's have a look at


the other stories making the headlines around the world.


The Business Insider asks - China's GDP growth has slowed


while its debt has increased so is China heading


A regular question and we will look at the detail.


The Washington Post has details about the daunting job interview


On your very best day at work what did you do that day?


This seemingly simple question was conceived to help assess


And the FT reports on the CEO email scam that has cost


Apparently more than 12,000 people around the world have fallen victim


We will explain this particular scan in a minute. Let's talk interview


questions, Lawrence, because it has got everybody animated this morning.


Keep your questions coming in. If you go for a job at Facebook, they


touch on this question, trying to assess a candidate's usefulness to


the business. You interview people. What do you ask them? I always ask


at the end, tell me the most memorable thing about Hughes said


that we will know you over the other candidates. One guy said to me that


he learned to drive a steam train before he learned to drive a car,


which was great! It revealed him as a railway enthusiast. Khatami one


your daughter had to answer yesterday. She went to an interview


and in the job they asked her what your best friend and worst enemy


would say about you in the workplace. It threw her. You end up


focusing on your worst enemy and to did not get the job unfortunately.


It is about standing out. Christopher says that his worst


question was whether his knowledge was deep or broad. To me that means


nothing. You cannot say both. It is about coming up with something


original. Say whatever you want it to be if you want the job! Fabrics,


thank you for getting in touch. The toughest question is why do you


think you are the right person that we need? It is tricky, controversial


and stressful. It is addressing what you can do versus what the business


needs. Everybody has identical CVs these days and trying to find


something personal that makes them stand out is difficult. Let's get to


this email scam, an issue for cyber security. The story here, it is


costing companies $2 billion and you think the email comes from your boss


asking you to transfer money but it is from a fraudster. You feel sorry


for people that have fallen for this. If my boss asked me to wire


him money, I would worry, about him and about the business. But these


are clearly plausible emails. This is a large amount of money and the


police have made some arrests around the world so it is genuinely global


fraud. Some businesses need to take this seriously but I do wonder. You


see the cost to business, $2 billion, and they are now investing


even more to make sure they are prepared. It is about the cost


benefit thing, putting the money up now so they are not at risk. We have


talked about the threat of cyber crime, which is


becoming a huge amount of company's spent that they cannot grow their


businesses and hire more people. Thank you for being on the show and


talking through the newspapers today. If you have a job interview,


the best of luck. If your boss asks you for money, say no. Top tips from


as! We will see you soon. Goodbye. Good morning. Another day where we


are starting off in a deep freeze with widespread frost. Temperatures


took another dive last night, similar to the previous


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