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This is Business Live from BBC News with Alice Baxter
China's mighty engine is losing steam - the Asian giant
reports the weakest growth since the financial crisis in 2009.
Live from London, that's our top story on Friday 15th April.
China's economy expanded at an annual rate of 6.7%
in the first three months of this year - better than many
developed economies - but too weak for this Asian might.
the fallout from BP's dramatic shareholder revolt as a $20 million
pay package for the boss Bob Dudley is rejected.
But will it change the way executive pay is agreed?
And we'll keep you up to speed with the markets.
Global stocks pretty mixed on Friday as investors await the outcome
And we'll be getting the inside track on a pact to share
information by the five largest economies in the EU in the wake
of the Panama Papers leak with our guest editor Andrew Walker.
And so on that note, we want to know, do you think Russia
and France will play ball and share their
Would you share your tax information?
We start in China with the slowdown in the world's number two economy.
The latest growth figures show the weakest growth
numbers since 2009 - since the financial crisis.
In the first three months of this year,
China's economy expanded at an annual rate of 6.7%.
That's down from the 6.8% we saw in the last three months of 2015.
This chart shows growth since the 1980s.
From 2000, you can see the boom which boosted
the whole world's economy - followed by a sharp slowdown.
China's facing an array of challenges.
From weak global demand for its products
But at home, it's become too reliant on huge,
inefficient state run firms, often called Zombie Companies.
Some six million jobs will need to be cut over the next few years.
This week the International Monetary Fund called China one
of the biggest threats to global financial stability.
In particular, Chinese firms that are struggling to pay their debts.
That could be a huge ticking time bomb.
The IMF says loans worth almost $1.3 trillion
I'm joined by Jinny Yan, Chief China Economist at ICBC
Standard Bank and also by our Asia Business Correspondent,
Thanks for coming in. Karishma, you have been looking at this over
there. And every time we get numbers out of Beijing, the big question is,
can we trust those numbers? That is what everyone always asks, as you
say, when these sorts of figures come out of Beijing. And certainly,
it is very much in line with what the market was expecting. Analysts
said that growth should come anywhere between 6.6 and 6.8%.
Even the Chinese Communist Party, the National People's Congress, when
they laid out their plans for the economy, they said that growth
should come in between 6.5% and almost as if these figures have been
plucked from the minds of Beijing officials themselves. But a lot of
questions being asked about how real these figures are and whether there
is a more protracted slowdown on the ground and how sustainable this sort
of growth is for the Chinese economy.
where you are. Jinny, can I ask you this, is China addicted to stimulus?
I think the world is addicted to China.
To China having high growth. I think the world very much needs China to
be strong at the moment. The reason for growth in the rest of the world
is not very clear at the moment. think a strong China is very good
for the rest of the world, particularly emerging economies. So
it is not very clear what is behind the growth for the rest of the
world? What is behind the growth in the numbers for China? What we see,
the real news is not really the headlines. 6.7%, everyone was
expecting that. That is not the story, the story is that other
official statistics, investment and production, those beat economic
forecasts. That is actually a very strong trend. What we need to be
concerned about is what lies beneath that. And of course we are going
back into the traditional model of growth, pumping credit from the
banks, and also infrastructure, government spending. This is how
China grows and this is how they know to grow their economy. But
China is very much trying to rebalance that towards consumption.
But that seems to be taking a bit of a back
seat for the moment. Jinny, is trying on
toll of 6.5%? -- is China on course. How big a problem is corporate debt
answer, 6.5% is achievable. I think the government will do a lot and the
government has a lot of physical power to be able to achieve that
growth. On the corporate debt story, that is a key
This is a problem that China is trying to solve. A lot of that
corporate debt, 160% of GDP, is sitting on banks' balance sheets.
them, and if the government needs to step in with a capital injection, it
may ultimately have to. And some of those state owned enterprises... Can
I just bringing Karishma back in? On the debt, we
talked about this could be a possible default. Can
China handle that kind of some? Well, what we have been witnessing
is a 30 year miracle of economic growth in China, and that proves
that China can pretty much handle whatever it says it wants to handle.
Don't forget, Beijing officials always points to the fact that China
has a massive that is one of the big buffers to
these problems. It also points to the fact that it is trying to reform
the economy, as Jinny points out, but this level of debt, pumping
money into the system and creating this economic growth figure that we
have seen, how sustainable is that going forward? Because it can only
produce growth for a period of time. And that is the big concern over the
next couple of years. But Karishma, with growth still the
China, very briefly, might we see that a rebalancing within the
economy taking a back-seat? Indeed. And I think we are seeing
sides of that. This is a difficult political issue
for the government. Don't forget, a lot of what the Chinese economic
on is that stability, the idea that people will not have massive job
losses. We have been hearing about the massive
steel and coal services... Industries. Thank you very much to
you both. In other news, the five largest
European economies have agreed to work together to try
to combat tax evasion - urging other countries
to follow their example. The UK has joined France,
Germany, Italy and Spain in agreeing to share information
about the secret owners of businesses and trusts who hide
behind so-called 'shell companies'. The deal, announced
at the International Monetary Fund meeting in Washington,
comes in the wake of the tax Microsoft is suing the US government
over the right to tell its users when federal agencies want access
to private data. It says keeping access requests
secret is against the US constitution, which states that
individuals should be made aware if the government searches
or seizes their property. BP shareholders have rejected
a pay package of almost $20 million for chief
executive Bob Dudley at the oil Just over 59% of investors rejected
Mr Dudley's 20% pay increase - which came despite record losses
and thousands of job cuts. It is one of the largest rejections
to date of a corporate The vote is non-binding on BP,
but the company's chairman has We are having a quick look at the
BizLive website. Car sales up across Europe, not a good story.
Volkswagen, if you read the tablet, is down. Down by 1.6%. Despite the
UK buying the highest number of VW cars
since the uproar over that scandal. And the other one you
wanted to highlight? Sales are up at the world's
retailer, Carrefour, after robust sales in Spain and Italy.
Let's take a look at what is happening around the world,
kicks off its spring meeting on Friday. Finance
leaders have been gathering in Washington, DC this week.
High on the agenda, concerns over the global economy as well as
possible risks of the UK exiting from the EU, known as a Brexit.
Meanwhile, we will also find out how American
consumers have been feeling lately when the latest figure for April
gets released. And it is expected that they have been feeling slightly
better thanks to steady hiring in the labour market. And of course the
earnings season continues, with another banking
giant, Citigroup, reporting its results for the first three months
of this year. So far its rivals, such as JP Morgan
and Bank of America, have all managed to surprise the market with
slightly better-than-expected results. But you have to remember
that investors have been expecting the
worst quarter since the financial crisis, so it is the case of under
promising and over performing. Well, let's move to Asian now
where stocks are fairly subdued on Friday as investors digest
China's slowing but relatively upbeat GDP numbers,
which were in line Meanwhile here in Europe,
after a buoyant few days lead by a surge in crude prices,
markets have opened pretty flat - holding their breath before a key
weekend meeting of oil producers - lead by Saudi Arabia
and Russia to discuss The FTSE 100, fairly flat at the
open. We are joined by Jane Sydenham,
Investment Director, A familiar face to us all. Let's
stay with the subject of oil and the
markets. Not so much today but oil has had a bit of a surge and the
markets have been that upward swing. It has had quite
an effect. The oil majors have had a good run this week, feeling that
perhaps finally the market is stabilising.
This meeting at the weekend is going to be quite interesting though I do
not think we are expecting that it will make a huge difference to the
supply of oil. But for the first time in months and months, we might
have a sense that maybe there is some discipline
coming back into the market. That is what we are looking for. Can
we switch gears? Nice little entry there, by the way. Every mistake
that goes on here, I pick it up! I was just going to mention, crude
prices, we saw this spike in equity earlier this week. Was that a case
of markets taking their lead from what we saw happen to the crude
price? Definitely. It was a downward force
over the last few months, the sense that maybe to some extent it is
good for consumers, if the prices for oil, but it is bad for stocks.
-- if the prices fall. There is less demand in China for
crude and commodities, so the sense of stabilisation is quite important.
Mariko was mentioning it, but boy, what a difference a
years can -- a year can make. 2016, pretty
dismal, although 2015 was cracking. What is behind the change? To some
extent, China. China is affecting growth around the world and the
manufacturing part of most economies is performing brulee, even though
services are doing well. That has affected all the major economies, we
have seen a lot of for European companies coming down.
A lot of those companies, to some extent,
are under promising. 2-wood will be interesting to see if the earnings
are as bad as expected. To some extent in the US, the strong dollar
has been a worry because companies will be affected by that to some
extent. If we see slightly better earnings, that would be good for the
markets. Still to come, spring
is in the air, the cherry blossom is in full bloom -
so why such glum faces at the IMF and World Bank
meetings in Washington? We'll tell you why -
global economic jitters, headwinds from China
and the damaging fallout You're with Business
Live from BBC News. He's a game changer on the pitch
and is now hoping to change Arsenal footballer turned
entrepreneur Mathieu Flamini has been pioneering research
into an alternative to oil With his business partner
he co-founded GF Biochemicals, which is the first company to mass
produce Levulinic Acid, which is said to be able to replace
oil in all its forms - it could potentially
be used as a bio fuel or to make pharmaceuticals,
plastics, cosmetics and even Tanya Beckett began
by asking how it works. It is acid which reacts
exactly like oil. That means you can substitute oil
in traditional products. And obviously you have
patented the technology We have appropriate technology
that we developed eight years ago. The company was created eight years
ago in Italy. We started the production in 2015
and today we are entering the market, increasing our
production to 10,000 tonnes. That is obviously a relatively small
amount compared to the whole market. How is it that you got started
in investing in this business? I moved to Milan eight years ago
to play for AC Milan. At the time we were already very
interested in climate change. So we created this opportunity
by meeting with a scientist and together we developed
this bio technology. What skills do you
bring to the table? For the operation we have a very
strong team on the field. I'm more focused on the
strategy of the company. Also what helps a lot is my business
partner who is on He is dealing with the day-to-day
operation. How have you managed to get sport
and business to mix? I want to make clear something,
my priority is football, But as you can imagine,
all players have other interests outside the pitch
and my interest is the bio economy. You're watching Business Live -
our top story - China's economy grew at an annual rate of 6.7%
in the first three months of this year -
better than many developed economies And now let's get the inside
track on a busy week Our economics correspondent
Andrew Walker joins us now. But let's start with a story making
headlines at the IMF and World Bank. They are going to share sensitive
information, these five countries? Yes, I think so, if they can
establish the owners of these so-called shell companies who are
used to hide their high earnings from the tax companies, they say
they will share that information with each other. It is five
countries. They want the rest of the G20 to take up the baton and do the
same thing. This is a battle with the tax authorities? Yes, where they
have the information about who benefits from a company whether they
are the formal legal owner of it, they will share that information
with each other. Was this on the agenda? Or is this because of the
Panama leaks? The IMF meetings, there is much going on in the
sidelines, this was not formal IMF business as such, but no question
there is a desire to be seen to be doing something rapidly in response
to the panama papers. We have spoken about the impact of rising prices on
crude oil, there is the key meeting of oil producers this weekend, and
key people not attending, as well. We have two very large oil producers
not there, the United States and China, although they are producers,
they also very large importers, so on balance they tend to do better
from a low oil price. They would not want to be seen to be propping the
price up, but there is no question we have got Opec, probably all of
Opec, which includes Saudi Arabia and Iran, but some suggestion the
Iranian minister will not be there in person, sending one of his
officials instead. Russia, Kazakhstan, Mexico. If they can
agree to do something, that is a substantial chunk of the world oil
market. Two points I want to make. We hear that may be they will freeze
production at January levels, those levels were already record high.
Iran is just back and it would like to build its output up to the
pre-sanctions time of something like four million and it needs the money.
They do, they feel very strongly that they are entitled to reclaim
the market share they lost as a result of sanctions. There have been
conflicting signals from Saudi Arabia about whether they would not
be prepared to do some sort of freeze without Iran taking part. The
deputy crown prince said that they would not, but I think Mosby both
think that is not the last word from them on it, and the signs are that
they will be prepared to make an exception for Iran -- but I think
most people think. It would be no more than a phrase, as you said, but
the prize is now 50% above the low it reached in January -- no more
than a freeze. It is about $43, something like that, for Brent,
compared to 27, in January, and the high reflects the expectation that
there might be at least a freeze agreed, but the longer-term context,
it was less than two years was $115, so a good deal less than
half the peak it reached. Andrew, thanks for joining us.
In a moment we have the business pages.
But first here's a quick reminder of how to get in touch with us.
We can keep you up-to-date with all the latest details with insight and
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us on Twitter and Facebook. Business live, on TV and online, whenever you
need to know. What other business
stories has the media been Joining again us is Jane Sydenham,
Investment Director, We have found this story. In the
Financial Times. We could not avoid it. The fallout of this shareholder
revolt of BP shareholders, voting in huge numbers against Bob Dudley's
20% pay rise. It is a complex issue, it is true that he can't be blamed
for the level of the oil price and BP went into loss last year because
it was paying out in relation to the deepwater horizon disaster. On the
other hand, the absolute level of his pay and the multiple compared to
the average pay for a BP employee. The force of this vote against this
kind of pay package, does this mark a turning point? I think it does,
actually. 60% vote against is quite something and in the past we simply
have not seen that kind of level of protest and I think shareholders are
becoming more activist and they are thinking about shareholder
responsibility, it is a good thing. We only have 30 seconds. Microsoft
suing the Justice Department? Another Civil Liberties action on
behalf of tech companies, Apple are doing the same, Microsoft are
concerned that the bar for what is a reasonable request for privacy is
just too low. Consumers should know if their phone is being looked at by
the government? Absolutely. There is a big increase, the US Justice
Department looking at this. Yes. Jane, thanks for joining us.