06/04/2016 BBC Business Live


06/04/2016

Similar Content

Browse content similar to 06/04/2016. Check below for episodes and series from the same categories and more!

Transcript


LineFromTo

This is Business Live from BBC News with Ben Thompson

:00:00.:00:00.

Despite plunging oil prices, investment in shale gas

:00:00.:00:14.

Live from London, that's our top story on Wednesday 6th April.

:00:15.:00:34.

The price of crude has slipped back below $40 a barrel as supply

:00:35.:00:38.

So why are investors still piling their cash into shale?

:00:39.:00:44.

A $160 billion deal goes up in smoke.

:00:45.:00:49.

US drugs giant Pfizer scraps its takeover of Botox maker

:00:50.:00:53.

Allergan, as President Obama gets tough on tax inversion.

:00:54.:00:59.

And European markets are higher despite Greece's debt saga

:01:00.:01:03.

The global beauty industry is worth more than $110 billion a year,

:01:04.:01:13.

but how do you make your brand stand out?

:01:14.:01:17.

We sit down with the boss of skincare giant Rodial.

:01:18.:01:20.

It's a hit with celebrities and the rest of us, but is it

:01:21.:01:23.

And as Paypal scraps plans to create 400 jobs in North Carolina

:01:24.:01:29.

after the state recently passed anti-gay laws we want to know,

:01:30.:01:33.

is big business right to get involved in social issues?

:01:34.:01:37.

And is this corporate activism the way to change the law?

:01:38.:01:42.

Oil has been particularly volatile over the past couple of days

:01:43.:01:58.

But despite the uncertain outlook for producers,

:01:59.:02:03.

America's fracking fever continues, because new figures suggest

:02:04.:02:06.

investors still have their faith in the US shale story.

:02:07.:02:11.

According to research from the Carbon Tracker Initiative,

:02:12.:02:14.

investors are piling back into the sector, investing

:02:15.:02:22.

an incredible $8.9 billion in the first quarter of 2016.

:02:23.:02:25.

That's the highest level of investment in the industry

:02:26.:02:27.

on a quarterly basis since 2011, and a tenfold increase

:02:28.:02:30.

It's a surprising figure, considering Carbon Tracker forecasts

:02:31.:02:35.

that fracking companies will suffer 10% lower output this

:02:36.:02:38.

Investors are apparently betting that the price

:02:39.:02:42.

of oil can't go any lower, and that now the only way is up

:02:43.:02:47.

We have been talking about how billions of investment money has

:02:48.:03:18.

been withdrawn or put on hold, we are seeing a lot of investment, is

:03:19.:03:26.

this investors betting that the US shale oil and gas has hit rock

:03:27.:03:29.

bottom? That is the inspiration I would say, because oil was below $30

:03:30.:03:35.

in January, so the first quarter of this year, that is the lowest. We

:03:36.:03:44.

have had forecast of $10 by some banks, but the perception had been

:03:45.:03:47.

that this is the bottom, and from now on the prices would gradually

:03:48.:03:53.

recover. That is the only explanation I can see. It is all

:03:54.:03:59.

about nothing, they are taking risks, and I doubt if those putting

:04:00.:04:10.

money in two huge analysis, they go by ear, feelings, and they take

:04:11.:04:16.

positions. It is like playing at the casino. If you look at the US

:04:17.:04:22.

fracking picture, it is fragmented, you have big players, little

:04:23.:04:28.

players, they each need a different price to break even. There is a lot

:04:29.:04:34.

of the smaller guys that are suffering. Did you think this is

:04:35.:04:40.

right for consolidation, the guys sucking up the little ones? That has

:04:41.:04:44.

been the expectation for the oil industry in general. But it has not

:04:45.:04:53.

been as much as people expected. The costs vary. The range of different

:04:54.:05:01.

companies, each company has its own break even price. The cost of

:05:02.:05:11.

operations has fallen, there are now less than 500 bricks, there had been

:05:12.:05:21.

2000. The costs have come down, which might make the investors say,

:05:22.:05:27.

they can not be as bad losers, maybe profit makers. It is unusual. We

:05:28.:05:36.

always appreciate your time, thank you for explaining that.

:05:37.:05:39.

Germany's Angela Merkel has warned that it's not legally possible

:05:40.:05:42.

for Greece to reduce its debt burden while remaining in the EU.

:05:43.:05:46.

Talks have resumed this week between Greece and its creditors

:05:47.:05:49.

The IMF has long argued for Greece to be given debt relief.

:05:50.:05:55.

Ford says it plans to build a new $1.6 billion

:05:56.:05:58.

It says the move will create 2,800 jobs, and will focus

:05:59.:06:04.

But Republican presidential candidate Donald Trump has called

:06:05.:06:10.

The instant-messaging service Whatsapp says it will be encrypting

:06:11.:06:20.

So-called end-to-end encryption scrambles messages,

:06:21.:06:25.

making them only readable by the sender and

:06:26.:06:29.

The firm, which has a billion users around the world,

:06:30.:06:32.

says file transfers and voice calls will also be encrypted.

:06:33.:06:44.

I sent a message to a friend last night and I got that message. Have a

:06:45.:06:51.

look at the Business Live website, talking about the Swedish fashion

:06:52.:06:59.

retailer, pre-tax profit for three months down, although sales in March

:07:00.:07:06.

were up by 2%. This is one of my favourite subjects, aviation, and

:07:07.:07:12.

easyJet. This is a tweet from our colleague. Not a bad number of

:07:13.:07:23.

passengers. That percentage is also important,

:07:24.:07:26.

because it is about getting those planes full and being able to charge

:07:27.:07:28.

more for them. The temperature is rising in Mumbai

:07:29.:07:33.

and the heat has been on the UK's Business Secretary Sajid Javid over

:07:34.:07:38.

the last few days. He's been accused of not

:07:39.:07:40.

doing enough to protect He'll arrive in Mumbai today

:07:41.:07:42.

for talks with Tata Steel over In a couple of hours in that

:07:43.:08:11.

building behind me the Tata chairman will meet Sergei Javad. I have

:08:12.:08:19.

spoken to Tata, they are sending out an assurance that the process of

:08:20.:08:23.

sale they will follow for their UK operations will be thorough and

:08:24.:08:26.

transparent. The Business Secretary is hoping to get an agreement that

:08:27.:08:30.

whatever deal they strike for the takeover of those operations, it

:08:31.:08:36.

would result in mass job losses in the UK -- won't. They employ 15,000

:08:37.:08:43.

workers in its steel operations in Britain. The Business Secretary met

:08:44.:08:45.

with a potential buyer yesterday, the Chief Executive of liberty

:08:46.:08:51.

house, a commodities firm. He has told us he might be interested in

:08:52.:08:56.

purchasing the UK steel operations, and if there was an offer on the

:08:57.:09:01.

table that he made yesterday, that is something which we are expecting

:09:02.:09:04.

to be discussed in this meeting here today. We will be back with you if

:09:05.:09:15.

we hear any more. An important day, not only for Tata in India, but also

:09:16.:09:18.

for those here in the UK. Japan's Nikkei ended lower again

:09:19.:09:20.

today, marking its longest losing It's more than three years

:09:21.:09:22.

since Prime Minister Shinzo Abe launched his three-pronged

:09:23.:09:26.

stimulus-and-reform plan to revive the stagnant economy,

:09:27.:09:29.

but it's had limited impact. Elsewhere, European markets

:09:30.:09:35.

are higher today despite the fact that Greece is dragged back

:09:36.:09:42.

into the headlines by the IMF. We'll hear from Christine Lagarde

:09:43.:09:47.

on those comments over Greece later And later today we'll get the most

:09:48.:09:50.

recent minutes from the US Fed, where there could be some detail

:09:51.:09:54.

on any divisions on the committee. We will keep a close eye on those

:09:55.:10:03.

numbers. US drugs giant Pfizer has decided

:10:04.:10:08.

to kill off its planned $150 billion takeover of rival Allergan

:10:09.:10:16.

after US authorities launched a clampdown

:10:17.:10:19.

on so-called tax inversion. The deal would have moved

:10:20.:10:25.

the biggest drug company in the US to Ireland to lower its taxes,

:10:26.:10:28.

but that deal is now off. It is not confirmed, what we are

:10:29.:10:50.

expecting it to be off. Great to have you with us. It is fascinating.

:10:51.:11:02.

As a lay man, you would go, hang on, perhaps Pfizer were not interested

:11:03.:11:10.

in the product, it wanted lower tax? That was a key part of the deal,

:11:11.:11:14.

they were going to save $1 million a year. The tax rate in Ireland is

:11:15.:11:23.

12.5%, in the US it is 35%. The challenge now, if the deal is off,

:11:24.:11:30.

what they do next, but also it is interesting from the US

:11:31.:11:32.

administration point of view that this is their headline act, that

:11:33.:11:36.

they wanted to stop this happening, to send a message. Yes, and the boss

:11:37.:11:43.

of Tata tried to buy AstraZeneca in 2014, that was predicated on taxing

:11:44.:11:49.

version, partly, that did not work either. The Administration bringing

:11:50.:11:58.

in these antique inversion rules, purely aimed at Pfizer, with

:11:59.:12:05.

language relating to the way this deal was structured. He did not

:12:06.:12:10.

specifically mention Pfizer, but on top of that, multinationals will be

:12:11.:12:16.

looking at it. Multinationals operating in the US are up in arms.

:12:17.:12:24.

It is an expensive end to the deal, they will have to pay a break fee.

:12:25.:12:30.

Bankers were due to earn money on the deal. They will get some of it,

:12:31.:12:37.

but not all of it. It is part of a movement to get tough on tax, we

:12:38.:12:41.

have seen it, who is paying tax where. That continues apace. Yes,

:12:42.:12:48.

Bernie Sanders has mentioned it, as has Donald Trump, in the wake of the

:12:49.:12:53.

Panama papers being released, it is more relevant than ever. We will

:12:54.:12:58.

keep our eye on that, and you will talk through some stories later.

:12:59.:13:12.

The global beauty industry is worth $110 billion a year,

:13:13.:13:20.

but how do you make your brand stand out?

:13:21.:13:22.

If you thought snakes, dragons and super stem cells

:13:23.:13:24.

were the stuff of fantasy, think again.

:13:25.:13:26.

The cosmetic brand Rodial used flashy-sounding names

:13:27.:13:28.

to capture a corner of the market, treating skin conditions.

:13:29.:13:37.

When you arrive at work in a morning, ever spare a thought

:13:38.:13:39.

for the teams of overnight workers who keep our schools,

:13:40.:13:42.

An army of contract cleaners work overnight

:13:43.:13:45.

to look after two thirds of offices and schools in the UK.

:13:46.:13:48.

The cleaning sector is worth ?8 billion to the British economy.

:13:49.:13:51.

Steph is at the British Cleaning Council's trade

:13:52.:13:53.

Good morning, yes, this is one of the companies being exhibited, you

:13:54.:14:13.

have failed their! I am on one of the ride on bits of kit. It is an

:14:14.:14:19.

end street worth to the UK economy. It employs 450,000 people, which

:14:20.:14:23.

will increase by 3% in the next year. It is one that is growing. It

:14:24.:14:30.

is changing a lot. Often, cleaners would be the people you did not

:14:31.:14:35.

really see in the office, because they would be the people working

:14:36.:14:40.

when you are not there, but that is changing. Because of that, the kit

:14:41.:14:45.

is changing as well. A lot smaller kit, although this is not

:14:46.:14:51.

representative! That is so they can actually make sure they can get

:14:52.:14:55.

round the offices. They were telling me something that has had a big

:14:56.:14:58.

impact is the increase in the minimum wage, because this is an

:14:59.:15:03.

industry that pays around the minimum wage. That has made an

:15:04.:15:08.

impact. The company you saw earlier were telling me that they have had

:15:09.:15:13.

to put up prices in order to cover this. Jackie is racing me this

:15:14.:15:21.

morning! A lot of innovation here, it is changing the way the industry

:15:22.:15:25.

is working. If you look at the types of people employed in the sector,

:15:26.:15:31.

one in three in England is a migrant, so the EU referendum could

:15:32.:15:35.

cause uncertainty. And I think I will finish this by racing Jackie,

:15:36.:15:40.

so I will see you later. Big industry, but what is more important

:15:41.:15:41.

is I win this race. Of good stuff. I hope she is not

:15:42.:15:59.

trying to get back to the office. The website, the place to find the

:16:00.:16:05.

latest revelations. The price of crude slips back below

:16:06.:16:06.

$40 a barrel as supply But despite this, investors

:16:07.:16:16.

are still piling their cash into shale, as they bet

:16:17.:16:24.

on a recovery in energy prices. Even though production is expected

:16:25.:16:36.

to be down on last year. Beauty may well be in

:16:37.:16:40.

the eye of the beholder. More people watching, would probably

:16:41.:16:46.

agree! But it's also a billion dollar

:16:47.:16:48.

industry. Skin care is an especially important

:16:49.:16:50.

part of the picture - with latest figures suggesting it's

:16:51.:16:53.

worth more than $110 That there is a lot of money, for

:16:54.:16:55.

cream, stuff for your face! So do you distinguish yourself

:16:56.:17:10.

in such a crowded market place? That's a question for our next

:17:11.:17:13.

guest. Maria Hatzistefanis

:17:14.:17:16.

is the founder of Rodial. The company specialises in helping

:17:17.:17:19.

deal with a range Maria started life as a journalist -

:17:20.:17:22.

but spotted a gap in the market It's grown a lot since then -

:17:23.:17:32.

and now operates in 35 It's said to count celebrities

:17:33.:17:37.

amongst its fans - Unfortunately, we could not get Kim!

:17:38.:17:40.

So we got Fritzy! Victoria Fritz sat down

:17:41.:17:55.

with the founder of the company and asked her whether Rodial's

:17:56.:17:57.

claims that its fancy ingredients fix skin complaints

:17:58.:17:59.

were medically proven. With all our products,

:18:00.:18:01.

we use ingredients that have gone Everything we use, backed

:18:02.:18:03.

up by research. At the same time, we want them

:18:04.:18:11.

to be exciting, fun, we want the customer to get involved

:18:12.:18:16.

with the lifestyle. Your range includes snake serum,

:18:17.:18:21.

dragon blood, stem cell superfoods. I assume you have neither snakes,

:18:22.:18:27.

dragons, in your products! So do you not feel

:18:28.:18:34.

you're misrepresenting? When we started, we were really

:18:35.:18:38.

small, so I needed to come up with names to make

:18:39.:18:42.

the range stand out. One of the first

:18:43.:18:47.

products, snake serum. When I came up with the idea,

:18:48.:18:52.

I thought shall I call it anti-ageing, or use

:18:53.:18:55.

the main ingredient, I thought, how much more exciting

:18:56.:19:04.

to call it snake serum, Of course, people love

:19:05.:19:12.

the name, some hate it. But what we got, a lot of buzz,

:19:13.:19:18.

people talking about the brand. And when you do not have a huge

:19:19.:19:24.

advertising budget, it takes your company

:19:25.:19:27.

to the next level. You first worked as a beauty writer

:19:28.:19:32.

so you've been on both sides. You know how many freebies

:19:33.:19:36.

these magazines get. How unbias is the advice

:19:37.:19:47.

from beauty editors? When it comes to magazines,

:19:48.:19:51.

I think we know most journalists are unbias,

:19:52.:19:56.

at times we would send products, they wouldn't cover it

:19:57.:19:58.

unless they liked it. If they are not an advertiser they

:19:59.:20:00.

do not have an obligation to cover. Win it comes to celebrities, unbias

:20:01.:20:14.

recommendation of the products, but sometimes. Anybody can be a beauty

:20:15.:20:24.

blogger. How concerned are you about controlling the brand online? You

:20:25.:20:31.

cannot control it. What we do as a business, we make sure that whatever

:20:32.:20:36.

content we produce, whatever the message, we take it across

:20:37.:20:41.

platforms, Instagram, YouTube, e-mail databases, making sure that

:20:42.:20:47.

everybody gets the same message. How people take that message,

:20:48.:20:53.

interpreted, that is something that we cannot control. What does the

:20:54.:20:58.

future hold? Do you plan on expanding? I want to develop social

:20:59.:21:07.

media, even further, that could be with the YouTube channel, we also

:21:08.:21:15.

launched a docu-series, behind-the-scenes, a project. And

:21:16.:21:19.

that would enable us to communicate with everyone, grow the brand. And

:21:20.:21:30.

on the other hand, physical stores, grow in the UK with Harvey Nichols,

:21:31.:21:39.

and I want to take this internationally, New York, Hong

:21:40.:21:42.

Kong, and take this spatial, flagship business globally. That was

:21:43.:21:47.

the boss speaking. Her name? Maria Hatzistefanis

:21:48.:21:54.

is the founder of Rodial. Sorry if you're watching for that!

:21:55.:22:18.

Quickly moving on, James is back. Taking a look at the newspapers.

:22:19.:22:28.

Prince Andrew stepping in with Tata. Beijing. He has been critical, China

:22:29.:22:34.

has been said to be part of the problem? Prince Andrew was in China,

:22:35.:22:41.

speaking to the president, we do not know what the response was, but as

:22:42.:22:47.

we were talking about, Russia is another huge issue, in terms of the

:22:48.:22:52.

amount of steel, it is not just China, so presumably Xi give him a

:22:53.:23:03.

robust response. And Lithuania also exports about 95% steel. Is it

:23:04.:23:08.

correct that the royals get involved? We have even been told,

:23:09.:23:14.

they could get involved, with the EU debate, should they be getting

:23:15.:23:24.

involved, using any clout? Prince Andrew, he was involved, with her,

:23:25.:23:33.

-- the trade envoy, he clearly would have been bruised, Dell must --

:23:34.:23:42.

briefed, it is not going to change policy but it does add some

:23:43.:23:50.

pressure. Clearly, this widens it to an audience. Royals getting

:23:51.:23:59.

involved. Raises the profile. Do you think that he has been raising the

:24:00.:24:05.

profile, more than Business Live? I doubt that. And PayPal. PayPal, not

:24:06.:24:14.

going to tolerate North Carolina discrimination. They have been

:24:15.:24:22.

calling this the bathroom law. It has been targeting the transgender

:24:23.:24:33.

community, using public bathrooms lined with the gender on their birth

:24:34.:24:38.

certificate. Yes, PayPal weren't going to be opening an office, and

:24:39.:24:42.

North Carolina, but do note, business and action, not going to

:24:43.:24:47.

this day because they do not like the stance on the issue. We have

:24:48.:24:51.

been asking people, a people think this was correct. Christina has

:24:52.:24:57.

said, yes, it is the only way to hit the bottom line. Businesses should

:24:58.:25:01.

be free to take decisions, according to ethos. But Jack says it raises

:25:02.:25:14.

questions for Nissan. At Mississippi. It raises the question

:25:15.:25:18.

is, does business have an active role to play, or just an observer?

:25:19.:25:25.

That is correct, and American tech businesses have been on the front

:25:26.:25:29.

foot, then some more traditional companies, when it comes to social

:25:30.:25:40.

activism, money where the mouth is. Funny place, the States! So

:25:41.:25:48.

different, between the coasts. It is difficult to believe it is 2016.

:25:49.:25:51.

Good on you James.

:25:52.:25:58.

Download Subtitles

SRT

ASS