:00:14. > :00:18.An impeached president and an economy mired deep
:00:19. > :00:20.in recession, how does Latin America's largest economy,
:00:21. > :00:43.Live from London, that's our top story on Wednesday, 1st June.
:00:44. > :00:45.Laden with debt and a shrinking economy, can Brazil's interim
:00:46. > :00:47.president drag the country back into growth?
:00:48. > :00:50.And from one commodity rich country to another but it's a very different
:00:51. > :00:53.Its latest growth number is surprisingly good news,
:00:54. > :01:01.boosted by exports and consumer spending.
:01:02. > :01:07.A quick look at how the European markets begin the day. Lots of red
:01:08. > :01:14.on the board. We'll tell you why later. Aaron.
:01:15. > :01:18.And we'll be talking to entrepreneur Lloyd Dorfman who opened one small
:01:19. > :01:25.bureau de change shop in London back in 1976.
:01:26. > :01:27.It's called Travelex and today it's the world's biggest
:01:28. > :01:36.And we're looking at how a British retail institution.
:01:37. > :01:39.Marks Sparks is turning off the music in its stores - why?
:01:40. > :01:45.Because its ageing customers are complaining about the noise?
:01:46. > :01:51.But hang on - what about us youngens,
:01:52. > :01:54.But hang on - what about us youngens, what about younger people?
:01:55. > :02:02.Latin America's biggest economy, Brazil, it's got soaring government
:02:03. > :02:04.debt, rising inflation and escalating unemployment
:02:05. > :02:07.and just to add to the mix it's also mired in political scandal.
:02:08. > :02:10.It's due to report its latest growth figures and it looks like it is only
:02:11. > :02:15.The interim president, Michel Temer, is proposing a raft of economic
:02:16. > :02:19.measures, but can they rescue Brazil's economy?
:02:20. > :02:21.The government has a huge deficit and needs to make savings
:02:22. > :02:28.Mr Temer wants to create constitutional spending limits,
:02:29. > :02:37.reducing the growth of health and education spending.
:02:38. > :02:40.He also wants to reform the country's pension system,
:02:41. > :02:44.making Brazilians work longer and retire later.
:02:45. > :02:47.Opening up the oil sector to foreign firms is also on the agenda,
:02:48. > :02:53.making the industry less reliant on government investment.
:02:54. > :03:01.Edward Glossop, emerging market economist at Capital Economics.
:03:02. > :03:07.Edward great to have you in the studio with us. You know, you go
:03:08. > :03:11.boy, where do you start with Brazil? No, seriously, there is so much to
:03:12. > :03:16.do to try and bring it back from the brink. The $50 billion saving a
:03:17. > :03:22.year... Yes. Where is that going to come from? Well, it is a good
:03:23. > :03:26.question. 90% of spending is mandated and earmarked by the
:03:27. > :03:32.constitution or fiscal rules and so that spending is going to be
:03:33. > :03:36.extremely difficult to cut. He has got his work cut out getting that
:03:37. > :03:42.through Congress for sure. The more an economy cuts, an economy that's
:03:43. > :03:48.already, right, you know, soaring unemployment, inflation, is up
:03:49. > :03:52.nearly 11% the last time I looked, the currency has taken a hammering.
:03:53. > :03:57.The more you cut, the more it will hurt the other stuff, isn't it?
:03:58. > :04:02.Absolutely. That's going to exacerbate the recession. When the
:04:03. > :04:10.commodities boom was, commodity prices were high and rising, now
:04:11. > :04:14.that the commodities boom fizzled out it overspent in the boom and how
:04:15. > :04:20.it is having to cut back when times are tough. We've got this
:04:21. > :04:22.impeachment. It is a six month investigation, it is an impeachment
:04:23. > :04:26.trial. Is that still putting off investors? There is still
:04:27. > :04:30.uncertainty, right? Of course. That's putting off investors
:04:31. > :04:34.investing in Brazil and probably making it one would imagine hard for
:04:35. > :04:39.Brazil to go to the foreign money markets and raise money? Of course.
:04:40. > :04:42.What does it do? This is an interim Government. This week he had two
:04:43. > :04:51.members of the Cabinet resign. So it is not a good start for Temer. It is
:04:52. > :04:56.in a difficult place right now. The Olympic Games. A small shot in the
:04:57. > :05:02.arm, a boost to the economy, yes? Well, typically for these economies,
:05:03. > :05:05.especially for large economies like Brazil the Olympic Games don't have
:05:06. > :05:09.a huge boost to the economy. For what it is worth we don't expect it
:05:10. > :05:13.to have a significant boost or have any significant impact in terms of
:05:14. > :05:18.dragging the economy out of recession. We think the boosts are
:05:19. > :05:25.overdone. Edward short and sweet, but we appreciate it.
:05:26. > :05:29.You can keep that cup now since you've drunk out of it.
:05:30. > :05:40.Japan's Prime Minister Shinzo Abe is expected to announce a delay
:05:41. > :05:44.The tax is one of the key planks of Mr Abe's promised
:05:45. > :05:46.reforms, aimed at boosting the country's inflation rate.
:05:47. > :05:54.The move is expected to be delayed until 2019.
:05:55. > :06:00.Tourism spending has outpaced global trade for the fourth year in a row.
:06:01. > :06:05.The US followed by China, followed by France and Spain. Figures
:06:06. > :06:10.released this month show international tourism grew by 4% in
:06:11. > :06:13.2015 generating $1.5 trillion. Japanese telecommunications giant
:06:14. > :06:16.SoftBank have said it will sell at least $7.9 billion of its shares
:06:17. > :06:18.in Chinese ecommerce SoftBank is the major
:06:19. > :06:31.shareholder in Alibaba and its stake will fall to about 28%
:06:32. > :06:34.of the Chinese firm. Softbank shares climbed
:06:35. > :06:46.3.5% on the news to The tablet is working today. We're
:06:47. > :06:52.looking at the Business Live page. You and I touched on the plastic
:06:53. > :06:57.money. The Brits. Us Aussies had plastic money for a long time. We're
:06:58. > :07:00.playing catch up. Is the new ?5, does it survive in the washing
:07:01. > :07:05.machine? Yes, it should. It's plastic. The key is in the word! I
:07:06. > :07:13.want to just do this here. The world's longest tunnel. Oh yes. It
:07:14. > :07:17.is about to open, isn't it? Today. Longest, deepest rail tunnel.
:07:18. > :07:28.Switzerland, isn't it? This is like a quiz. Am I winning? How long is
:07:29. > :07:31.it? 25 miles. It is de-Seend to make easy connection between the ports of
:07:32. > :07:35.Northern Europe and Southern Europe. The Europeans love their tunnels.
:07:36. > :07:43.Just in time for the school holidays as well. 25 miles!
:07:44. > :07:45.I haven't lived there for a long time, but the Aussie economy is
:07:46. > :07:49.growing. Australia's economic growth
:07:50. > :07:51.is at its fastest since 2012. It grew at a better-than-expected
:07:52. > :08:02.1.1% in the first three The Aussies are selling more stuff
:08:03. > :08:07.abroad, but the Aussies are buying stuff on the ground in Australia?
:08:08. > :08:13.That's right. They're doing a bit of both and of course, we know this is
:08:14. > :08:16.an economy known as the Thunder from Down Under, that's not you Aaron,
:08:17. > :08:20.that's your economy we're talking about here! It is a surprise because
:08:21. > :08:25.we know how all regional economies have been hit by a slowdown in
:08:26. > :08:29.China. Australia counting on China as its largest trade partner,
:08:30. > :08:36.growing better than expected. So up 1.1% in the first quarter. It was up
:08:37. > :08:39.3.1% annually, a pace of growth that Australia hasn't enjoyed since late
:08:40. > :08:42.exports you talked about and thanks exports you talked about and thanks
:08:43. > :08:45.to a boost in household spending and we know that Australia's been
:08:46. > :08:50.struggling for growth since the mining boom tapered off mainly due
:08:51. > :08:56.to that slowdown in China. But this time, we're seeing service based
:08:57. > :08:59.industries, finance, retail, trade industries all contributing to
:09:00. > :09:04.growth and natural gas and the commodity exports that we saw a
:09:05. > :09:07.slowdown in. Economists saying the latest growth figures should reduce
:09:08. > :09:12.the need for further interest rate cuts and it might help boost the
:09:13. > :09:15.chances of current Prime Minister Malcolm Turnbull who is trying to
:09:16. > :09:21.defend his Government against the Labour Party ahead of an election in
:09:22. > :09:25.a month's time on 2nd July. Thank you very much indeed.
:09:26. > :09:27.Looking at the Asian markets - the Nikkei ending Wednesday
:09:28. > :09:31.Doesn't seem to have been boosted by that expected delay
:09:32. > :09:33.to the increase in sales tax in Japan.
:09:34. > :09:35.Of course that hasn't yet been officially announced.
:09:36. > :09:42.Perhaps the Asian markets tracking the weakness
:09:43. > :09:47.of shares on Wall Street which were down on Tuesday,
:09:48. > :09:51.as investors in the US brace for a possible rise in interest
:09:52. > :09:57.Michelle Fleury has the details about what's ahead
:09:58. > :10:07.As one trader told me me, this Wednesday is all about the Ms. Wall
:10:08. > :10:11.Street will be paying close attention to China's manufacturing
:10:12. > :10:14.index as they try to get a fix on global economic conditions. Closer
:10:15. > :10:20.to home, investors will be keeping an eye on the institute for supply
:10:21. > :10:23.management's manufacturing index. In spite of tepid demand from abroad
:10:24. > :10:30.and a strong dollar, the report is expected to show the sector expanded
:10:31. > :10:34.for a third straight month in May. The ought owe industry has been a
:10:35. > :10:38.bright spot for the economy, ranging up record sales in the US last year
:10:39. > :10:43.and it continues to do well. Sales for May are expected to total 17.3
:10:44. > :10:49.million for the month, but analysts suggest that the rate of increase in
:10:50. > :10:51.sales is starting to slow and that car-makers are beginning to rely on
:10:52. > :10:55.higher discounts to boost demand. Maike Currie, investment director
:10:56. > :11:11.at Fidelity International. Maike. Good to see you. He will
:11:12. > :11:15.delay the increase from 8% to 10%. It was supposed to come in next
:11:16. > :11:20.year, right, he will delay it two years, late 2019. That's a market
:11:21. > :11:24.story. I was looking at factory activity in ash yasmt it is not good
:11:25. > :11:28.news. All these countries, the factory-driven economies if you
:11:29. > :11:33.will, churning up stuff around the world we buy, down for the month of
:11:34. > :11:37.May again. China, world's second largest economy, barely improved
:11:38. > :11:44.last month. It ain't looking pretty, is it? No, lots of market attention
:11:45. > :11:48.is focussed on the UK's EU referendum and of course, the Fed's
:11:49. > :11:52.decision on interest rates. It is easy to forget about the other big
:11:53. > :11:56.concern which, of course is China. In light of this, the Chinese
:11:57. > :12:03.figures coming out later this week are really important. Of course...
:12:04. > :12:11.The PMI. These are forward looking numbers. That's right. That should
:12:12. > :12:22.give us an idea how confident Chinese manufacturers? Yes. Still in
:12:23. > :12:26.deflationary terry. This is a number the ECB will probably reference
:12:27. > :12:30.tomorrow when it makes its announcements on interest rates. The
:12:31. > :12:34.expectation is for no change, but Japan, Europe still in deflationary
:12:35. > :12:38.territory and the question is how do we kick-start the economies? We're
:12:39. > :12:42.going to leave it there. I know you're coming back for the papers.
:12:43. > :12:45.The European Central Bank, a key function of a Central Bank is to
:12:46. > :12:51.control inflation, right? That's right. They should be more on to
:12:52. > :12:54.that, some say! Still to come: And we'll be talking
:12:55. > :12:57.to entrepreneur Lloyd Dorfman, who founded the firm,
:12:58. > :12:59.Travelex, back in 1976. It's now the world's biggest
:13:00. > :13:10.foreign exchange retailer. It's the first day of trading for
:13:11. > :13:18.the new owners of Tata Steel's Long The plant was under threat
:13:19. > :13:22.of closure before Greybull Capital stepped in and agreed to buy it
:13:23. > :13:25.for ?1 a few weeks ago. Rob Young is in our business
:13:26. > :13:35.newsroom. Rob good to see you. Rob, a new
:13:36. > :13:39.brand, but surely many are asking really, is it a new dawn for British
:13:40. > :13:42.Steel? Well, this is a rarebit of good news for an industry which has
:13:43. > :13:46.been in crisis for the past couple of years. We have had thousands of
:13:47. > :13:53.job losses in the UK steel industry. The SSI steelworks on Teesside
:13:54. > :13:56.closed as well. And this, part of Tata Long products division which
:13:57. > :14:02.makes railway lines for Network Rail for example was bought by a turn
:14:03. > :14:08.around company for just ?1. It says it will invest ?400 million and says
:14:09. > :14:12.that its plan to turn around the business is bearing fruit. They say
:14:13. > :14:16.over the past couple of months, the company made a profit at an
:14:17. > :14:21.operating level, that's down to the recent rise in the steel price which
:14:22. > :14:24.we have seen, but also the fact that the 4800 workers agreed to take a
:14:25. > :14:29.pay cut and accept a reduced pension contributions as well.
:14:30. > :14:31.Rob, thank you for that update. We appreciate it. We'll talk to you
:14:32. > :14:43.soon. Rob Young there. You have not been buying enough
:14:44. > :14:50.Lycra. Apparently not. Sales of cycling kit have fallen. Bikes,
:14:51. > :14:57.pumps, Lycra outfits. It is the weather. It is a technical British
:14:58. > :15:04.story! House prices edging higher for the
:15:05. > :15:08.month of May. Up 0.2%. The average price of a house, what do you think
:15:09. > :15:18.it is? It is right there. About 200,000. Good guess! Funny that!
:15:19. > :15:23.That is according to nationwide. This is the business life page we're
:15:24. > :15:28.looking at. We have British Steel, of course. It does have a story we
:15:29. > :15:32.are going to touch on shortly, M, stopping the music.
:15:33. > :15:38.People have been complaining about the noise. Distracting while you are
:15:39. > :15:46.trying to make a purchases. Is it a nail in the Coffin for M?
:15:47. > :15:53.You're watching business life. Our top story, laden with debt, a
:15:54. > :15:57.shrinking economy, can Brazil's interim president dragged that
:15:58. > :15:58.country back into growth? We are expecting the latest figures
:15:59. > :16:02.to be released in a few hours. It's the age of the disruptor -
:16:03. > :16:07.from AirBnB to Uber - all challenging established norms,
:16:08. > :16:11.and in some cases turning One entrepreneur who's been
:16:12. > :16:20.particularly good at spotting market changes and providing people
:16:21. > :16:23.with a service they didn't know In 1976, he launched the first
:16:24. > :16:27.Travelex bureau in London. Forty years on it has
:16:28. > :16:29.become the world's biggest In 2010, he brought a stake
:16:30. > :16:35.in The Office Group, which provides flexible work space
:16:36. > :16:37.to thousands of start-ups And in 2014, he co-founded Doddle,
:16:38. > :16:42.which lets customers have online packages delivered to their location
:16:43. > :16:46.rail station where Businessman and philanthropist
:16:47. > :17:02.Lloyd Dorfman joins us. I was reading some of your
:17:03. > :17:06.background. This is your words. You said at school you are quite
:17:07. > :17:12.mediocre. You are not a genius but you were not an idiot. You failed
:17:13. > :17:18.economics, you did not go to university, in 1976 you opened a
:17:19. > :17:23.pure discharge. How do you go from that? A lot of hard work, a lot of
:17:24. > :17:28.persistence, a lot of self belief. And it was a time when I think the
:17:29. > :17:33.big banks traditionally provided these services. This was not a core
:17:34. > :17:38.business for them. The euro came in and they were less interested. We
:17:39. > :17:44.always saw the euro as -- an opportunity than threat.
:17:45. > :17:51.Is there anything at the moment, a niche that has not been to -- that
:17:52. > :17:56.has not been filled... Obviously you are not pretty tell us what it is!
:17:57. > :18:03.Is there something at the moment that someone is not doing? Not at
:18:04. > :18:05.the moment. But we are looking at some new businesses. Some
:18:06. > :18:12.interesting new photographer the Rio Grande to launch it the next few
:18:13. > :18:20.months. Watch this space. Click and collect is not really new. Nobody
:18:21. > :18:25.has cracked the problem. This is Doddle we are talking about. One of
:18:26. > :18:36.my bugbears. Most of us consumers are big online purchasers. It is a
:18:37. > :18:40.pain to send it off. You are a co-founder of this, right? You got
:18:41. > :18:44.together and you thought, there is a little hole? This was originally an
:18:45. > :18:49.idea being looked at by Network Rail. They came to me to partner
:18:50. > :18:55.with them. I bought them out about six months ago. And we are building
:18:56. > :18:58.and developing as a business. The real inside here as far as the
:18:59. > :19:02.retail network is concerned is for people to be able to do this at
:19:03. > :19:06.convenient commuter locations. On your way to work you can return
:19:07. > :19:13.things. On your way to work you can collect things. Doddle is growing
:19:14. > :19:17.into quite a powerful IT capability, to really drive click and collect
:19:18. > :19:21.for retailers as well as consumers. Your other businesses the office
:19:22. > :19:26.group which provides space for start-ups and new companies. How was
:19:27. > :19:31.the climate for people starting out? Easier or harder than when you
:19:32. > :19:35.started? Think it is easier, principally through technology. You
:19:36. > :19:38.can start a business from your bedroom. Last year we had a record
:19:39. > :19:45.number of businesses started in this country. People used to refer to us
:19:46. > :19:49.as a nation of shopkeepers. Perhaps it is a nation of entrepreneurs now.
:19:50. > :19:56.It is technology. You do not need bricks and mortar snout. No, you can
:19:57. > :20:05.sit at home and do it. I am curious about your background. In 1973 you
:20:06. > :20:12.went into an investment bank with no experience, no qualifications. 73.
:20:13. > :20:19.Can you remind viewers around the world and those perhaps here in
:20:20. > :20:24.Britain, what happened in 73? Within three months we had a quadruple in
:20:25. > :20:27.the oil price overnight, strikes, three-day working weeks, the
:20:28. > :20:34.collapse of the stock market, the property market, the collapse of the
:20:35. > :20:41.government, strikes... A baptism of fire. Absolutely. I went to do this
:20:42. > :20:46.to get as much commercial experience in a short time. But it was an
:20:47. > :20:53.incredible apprenticeship. I would going to meetings were not only the
:20:54. > :20:55.borrowers were in trouble, the bank was in trouble, the Bank of England
:20:56. > :21:00.was trying to hold things together. It was a great apprenticeship.
:21:01. > :21:10.Quickly, that is what is giving you the tools to go forward? Yes, it was
:21:11. > :21:14.a great insight for me. I have is -- I have always loved business. When
:21:15. > :21:18.you have been through that -year-old Frannie Challis. What was it about
:21:19. > :21:25.the exchange market that piqued your interest? We were coming into 1977,
:21:26. > :21:33.I thought it would be an interesting thing to do. It became a global
:21:34. > :21:43.business. We appreciate your time. Thank you. An honorary Australian,
:21:44. > :21:55.by the way. He loves Australia, don't you? I do. You have got to
:21:56. > :21:58.sponsor the cricket team. In a moment, the business pages. First, a
:21:59. > :22:00.quick reminder of how to get in touch.
:22:01. > :22:03.The business life pages where you can stay ahead with the breaking
:22:04. > :22:08.business news. We will keep you up-to-date with the latest details,
:22:09. > :22:13.with insight and analysis from the team of editors around the world.
:22:14. > :22:15.And we want to hear from you. Get involved on the bees -- -- BBC
:22:16. > :22:41.business life page. We got about one half minutes. M
:22:42. > :22:49.Music. Thank you for tweeting in. Don says music is the least of the
:22:50. > :23:00.problems for M Bring back good womenswear. Sally in France saying
:23:01. > :23:07.music is for a start. A big turn-off. Rubbish is what it
:23:08. > :23:11.generally is. It is an interesting story in light
:23:12. > :23:16.of the insolvencies we have seen on the high street with Austin Reed,
:23:17. > :23:19.BHS. The retailers are under tremendous pressure. They are either
:23:20. > :23:26.going to have to compete on price, like the discounters, primer, Lidl
:23:27. > :23:32.etc, or they have to compete on experience, like the Apple Store.
:23:33. > :23:36.M is doing neither this moment. The problem a lot of customers have
:23:37. > :23:41.is that it had not -- has not changed in 22 years. An interesting
:23:42. > :23:48.decision. They will save some money. Is this rarely what customers want?
:23:49. > :23:52.If they want to appeal to a younger customer base... When you are
:23:53. > :23:56.listening to music time seems to go more quickly. If you are in a shop
:23:57. > :24:01.and the music is playing, you lose track of time. Yes, I think it adds
:24:02. > :24:08.to the experience. I enjoy the music. One of our producers said
:24:09. > :24:14.they do not have clocks in shops. You lose track of time. They do in
:24:15. > :24:18.the homeware department but they are set to different times. It is like
:24:19. > :24:25.pumping fresh air into a Las Vegas casino. What is next? Are you
:24:26. > :24:34.interested in oil? Let's talk about it. The Opec meeting is on Thursday.
:24:35. > :24:39.Investors will be keeping a close eye on this. It is all about supply
:24:40. > :24:42.and demand. Supply has been corrected with things like the
:24:43. > :24:49.wildfires in Canada and military action in Nigeria. The discovery of
:24:50. > :24:54.new oil wells, which is dropped off immensely. The consensus is there
:24:55. > :25:00.will be no co-ordinated cut. No surprises there. That is presumably
:25:01. > :25:07.until the shale companies realise the price has gone up. We will not
:25:08. > :25:10.see oil passing the $100 mark again but we could see at stabilising at
:25:11. > :25:18.$60 per barrel, a far cry from where it was earlier this year. Very
:25:19. > :25:25.quickly, that last newspaper story. It seems that in 2015, the world
:25:26. > :25:31.loved to travel. We like to travel more than we like to buy stuff? That
:25:32. > :25:34.is right. The two main markets are the US and China. The amount of
:25:35. > :25:40.Chinese tourists travelling the world has increased since 2004,
:25:41. > :25:44.which is a remarkable number. Just last year alone they increased their
:25:45. > :25:52.spending by 25%. That is a major factor driving the economy.