:00:00. > :00:07.This is Business Live from BBC News with Ben Thompson
:00:08. > :00:15.Out in the cold - European leaders meet
:00:16. > :00:18.in Brussels to discuss the UK's role outside the EU
:00:19. > :00:20.but without David Cameron.Live from London, that's our top story
:00:21. > :00:41.It could be his final trip to Brussels, but David Cameron says
:00:42. > :00:46.freedom of movement is a central part of being in the single market.
:00:47. > :00:50.We will assess the new relationship as the EU prepares for divorce!
:00:51. > :00:55.Also today, telecoms giant Vodafone considers moving its London
:00:56. > :00:57.headquarters away from the UK, warning that access
:00:58. > :01:10.Markets are up sharply after a bumper session yesterday too. So
:01:11. > :01:16.have the fears really gone away? Or is it just a temporary reprieve?
:01:17. > :01:18.And we continue our special series speaking to the businesses preparing
:01:19. > :01:22.But what impact will Britain's exit from the EU mean
:01:23. > :01:25.The boss of Italian coffee giant Lavazza will be here.
:01:26. > :01:28.And we'll assess how the world's press are covering the fallout
:01:29. > :01:30.of Brexit including this story a new dating app that aims
:01:31. > :01:46.to connect people who share the same view on Britain voting to leave!
:01:47. > :01:52.The British Prime Minister left out in the cold.
:01:53. > :01:56.European leaders are meeting today in Brussels without David Cameron.
:01:57. > :02:01.The leaders of the remaining 27 member states will have informal
:02:02. > :02:03.discussions over the implications of the UK's vote to leave.
:02:04. > :02:06.Last night Mr Cameron gave what was probably his last press
:02:07. > :02:07.conference in Brussels, and outlined some of
:02:08. > :02:25.The European Union sees the single market as capital, goods and people
:02:26. > :02:30.and these things go together. And indeed, the European Union sees that
:02:31. > :02:32.the structural fund payments that are made through the European Union
:02:33. > :02:36.are again, part of the single market. I think sometimes in Britain
:02:37. > :02:41.we think of these things as separate options. Very much the sense here is
:02:42. > :02:45.these things all go together and that if you want the full benefits
:02:46. > :02:49.of the single market then you need to be involved in every part of it.
:02:50. > :02:52.Now, that's obviously going to be a huge challenge to try and get that
:02:53. > :02:53.right for the future. As I said, a challenge for Europe. A challenge
:02:54. > :02:57.for Britain. Meanwhile German Chancellor,
:02:58. > :03:00.Angela Merkel, said there would be no negotiations based
:03:01. > :03:01.on cherry-picking Now yesterday, we discussed
:03:02. > :03:07.the implications for Germany and its role in shaping
:03:08. > :03:10.any future trade deal. Remember, the UK is Germany's third
:03:11. > :03:15.biggest export market. It will be a key player
:03:16. > :03:23.in any negotiations and compared with Germany it has
:03:24. > :03:26.a lot less to lose if It exported fewer goods to the UK
:03:27. > :03:40.last year - $35-billion worth Britain's vote has also given
:03:41. > :03:46.a boost to far-right parties including France's National Front
:03:47. > :03:48.which are now demanding their own The National Front's president,
:03:49. > :03:52.Marine Le Pen, said the UK vote And on economic policy,
:03:53. > :03:56.France is often seen as an advocate for protectionist measures,
:03:57. > :04:00.not least the common agricultural policy which provides
:04:01. > :04:02.billions of dollars Anne-Sylvaine Chassany
:04:03. > :04:21.is the Paris Bureau Chief Ann thank you for taking time out to
:04:22. > :04:25.be on Business Live. Just talk us through how Francois Hollande will
:04:26. > :04:29.try and get his influence in the negotiations. What is France hoping
:04:30. > :04:35.for, trying to get out of this divorce? Well, I think first of all,
:04:36. > :04:42.the economic impact on France will be moderate. I think that's the
:04:43. > :04:51.consensus here. Economists estimate that a UK recession could hurt the
:04:52. > :04:57.economy by 0.2% or 0.4% on the GDP. So it is modest. It will be
:04:58. > :05:03.negative, but modest. The political impact will be probably bigger on
:05:04. > :05:08.French politics. As you mentioned the impact on Marie Le Pen and what
:05:09. > :05:11.she is going to do in the next presidential elections And that's
:05:12. > :05:15.next year, it is not far away at all and we are aware of the difficulty
:05:16. > :05:20.Francois Hollande has got in terms of his popularity, but trying to
:05:21. > :05:27.push through labour reform, many changes in policy that are not going
:05:28. > :05:32.down well in France at all. Yes, but in a way, he sees this as an
:05:33. > :05:36.opportunity, I saw him last night at the EU Summit, he sees an
:05:37. > :05:43.opportunity to show French voters who are sceptical about the EU and
:05:44. > :05:49.the euro that leaving the European Union as Marie Le Pen is pushing for
:05:50. > :05:55.would have disastrous effect on the economy, on you know, on the people
:05:56. > :05:59.itself when you see, you know, young people, you know, rebelling against
:06:00. > :06:04.their parents or complaining about an exit. It doesn't look good, it
:06:05. > :06:09.doesn't help Marie Le Pen down the line and he sees that opportunity to
:06:10. > :06:14.settle the question of the EU once, you know, for good during the
:06:15. > :06:19.presidential elections despite, as you said, his abysmal approval
:06:20. > :06:24.ratings. As you say, the economic impact is expected to be marginal,
:06:25. > :06:29.but from some points of view, France can benefit. Many are arguing that
:06:30. > :06:34.investment bankers could be headed to Paris to relocate because of
:06:35. > :06:39.course, London will no longer be able to work effectively in some
:06:40. > :06:43.areas of business? Yes, Francois Hollande mentioned that last night
:06:44. > :06:49.saying that the City of London will now be able to do the clearing, the
:06:50. > :06:55.euro trade clearing and it is a pretty big activity for the City of
:06:56. > :07:00.London. So he also, you know, sees an opportunity, an economic
:07:01. > :07:04.opportunity to strengthen Paris as a financial centre. Obviously, you
:07:05. > :07:09.know. He is going to have competition with, you know,
:07:10. > :07:14.Frankfurt and Dublin, but indeed, he is really trying to capture that
:07:15. > :07:19.part of that fall-out. I'm sure he is.
:07:20. > :07:22.Thank you so much. The Paris bureau chief at the Financial Times.
:07:23. > :07:25.Vodafone has warned it could move its headquarters from the UK,
:07:26. > :07:29.depending on Britain's negotiations to leave the European Union.
:07:30. > :07:32.In a statement, the telecoms giant says it's important to retain access
:07:33. > :07:35.to the EU's free "movement of people, capital and goods"
:07:36. > :07:37.but warned it was too early to "draw any firm conclusions
:07:38. > :07:44.China's first home-grown airliner has landed in Shanghai
:07:45. > :07:52.The Comac plane has been in development since 2002
:07:53. > :07:54.and is China's attempt to break into the aircraft market dominated
:07:55. > :08:03.China is likely to become one of the world's biggest aircraft
:08:04. > :08:20.Sally, I'm glad we didn't put the full name in there. The full name
:08:21. > :08:25.was in an hour or two ago and I stumbled on it! More information on
:08:26. > :08:31.Vodafone, I'm failing to find more information. That is a big, big
:08:32. > :08:35.story in the UK. There are more details on the home business page
:08:36. > :08:39.for the BBC site, on the Business Live page we have got other stories
:08:40. > :08:41.including how markets in Asia fared today. There is another big story
:08:42. > :08:48.breaking in Asia today. Now on to Asia, one of the world's
:08:49. > :08:50.largest car manufacturers, Toyota is recalling 482,000 hybrid
:08:51. > :08:53.Prius and Lexus cars because of a possible
:08:54. > :09:03.airbag inflator defect. Explain this recall. It seems we've
:09:04. > :09:06.talked a lot about it, airbags, recalls, car makers, explain the
:09:07. > :09:10.latest one? Well, Toyota is recalling more than four million
:09:11. > :09:14.cars this time. Over two separate flaws. The first has to do with
:09:15. > :09:21.leaking fuel tanks and the second has to do with airbags that may
:09:22. > :09:26.crack and injury the car occupants. The airbags involve inflators in
:09:27. > :09:37.cars which have been parked and unoccupied for a period of time it
:09:38. > :09:43.is the Prius and Carolla. Toyota didn't specify as well who made the
:09:44. > :09:53.defective parts of the car, but they said they are not from Dakar ta.
:09:54. > :09:57.They are the ones responsible for the car industry's biggest ever
:09:58. > :10:05.recall following multiple deaths and injuries with deadly airbags.
:10:06. > :10:07.Thank you very much. And frankly
:10:08. > :10:13.Take a look at the markets at yesterday's close and this
:10:14. > :10:15.morning's open and you'd think there wasn't a lot going on.
:10:16. > :10:17.Even, something to get excited about.
:10:18. > :10:19.There was a strong rebound yesterday helped by the reassessment
:10:20. > :10:22.that the risks might not be as bad as many had feared.
:10:23. > :10:25.No immediate rush to trigger that Article 50 that would kick-start
:10:26. > :10:32.So that could mean that, in the short-term at
:10:33. > :10:37.That said, longer-term, there's still a huge
:10:38. > :10:41.But it does mean markets have a bit more time to assess
:10:42. > :10:43.what's actually going on, rather than the knee-jerk volatility
:10:44. > :10:58.The FTSE up 1.5%. In the longer term there are still risks.
:10:59. > :11:02.We will assess that in more detail in a moment.
:11:03. > :11:05.We'll assess that more in a moment, but here's Michelle with a look
:11:06. > :11:12.There are a couple of big names reporting earnings. Month Santa
:11:13. > :11:19.turns in its third quarter results later this Wednesday. For
:11:20. > :11:22.shareholders, the focus will be on a German take-over which it turned
:11:23. > :11:26.down last month. If any deal went ahead, it would be the third seed
:11:27. > :11:31.and chemical industry merger this year. Changing consumer habits are
:11:32. > :11:36.expected to dent profits at General Mills. Healthier eating habits are
:11:37. > :11:47.expected to have hit sales at the maker of cheer yos cereal and
:11:48. > :11:51.Yoplait yoghurt. And encouraging economic news boosted US financial
:11:52. > :11:54.markets on Tuesday. This Wednesday, watch out for May's pending home
:11:55. > :11:58.sales and consumer spending data. Global Market Strategist
:11:59. > :12:08.at JP Morgan Asset Management. Before we talk about the States,
:12:09. > :12:12.give us your take on this, up and up and up. It is good to see a bit of
:12:13. > :12:16.green on the screens after the past few days have been very bad for
:12:17. > :12:20.markets. I would say this is probably not a big sign of massive
:12:21. > :12:24.rebound. The Brexit uncertainties will still remain, we have been
:12:25. > :12:26.seeing through the news things keep developing politically and
:12:27. > :12:30.economically in term of trade negotiations and how it all works,
:12:31. > :12:33.it is good to see a bit of recovery after the bad Friday and Monday, but
:12:34. > :12:37.I wouldn't say we're out of the woods yet. That's Europe. Let's look
:12:38. > :12:41.at the US because we're looking at the global implications of this and
:12:42. > :12:47.one thing that may or may not be related, let's talk about US
:12:48. > :12:51.interest rates, we get excite about what the Fed thinks? It is tough for
:12:52. > :12:54.the Fed because they are supposed to look at the US economy in term of
:12:55. > :12:59.employment and inflation and those two aspects are doing well for the
:13:00. > :13:07.US, it is the big global concerns, a massive amount of volatility and
:13:08. > :13:10.markets selling off which makes the Fed pause for breath. We have seen
:13:11. > :13:13.actually in the past few days interest rate expectations for the
:13:14. > :13:20.Fed to start hiking rates be pushed back further and further. Now, they
:13:21. > :13:25.are all data dependant, they will be looking at the world to see if
:13:26. > :13:33.they're ready, but in time we have to see what Janet Yellen and her
:13:34. > :13:35.team think. For now, thank you. She will be back soon to talk
:13:36. > :13:37.through the papers. Still to come, wake up
:13:38. > :13:41.and smell the coffee. As Britain and Europe adjusts
:13:42. > :13:44.to idea of life outside of Europe, the boss of Italian coffee giant
:13:45. > :13:47.Lavazza will be here to discuss the implications for business,
:13:48. > :13:49.exports and our love of coffee. You're with Business
:13:50. > :13:58.Live from BBC News. Before the referendum,
:13:59. > :14:03.we heard that the price of electrical goods would go up
:14:04. > :14:06.if we voted to leave the EU. That's what the boss of electrical
:14:07. > :14:08.and mobile phone retailer Well, what does he
:14:09. > :14:13.think after the vote? Sebastian James, the Chief Executive
:14:14. > :14:26.of Dixons Carphone has been speaking Well, it is very hard to say, it is
:14:27. > :14:29.obviously early days and my view is I think pretty straightforward,
:14:30. > :14:34.which is we need to be grown-ups and we need to carry on. I think in the
:14:35. > :14:39.last five days, we haven't seen any material change in the way customers
:14:40. > :14:46.are behaving. So no decline in spend on the weekend? No, so far we are
:14:47. > :14:53.up, soap so far so good and in our view it is very important that we do
:14:54. > :14:58.everything we can to remain in the market and service customer survey
:14:59. > :15:03.continue to buy for us. And opening new stores, life goes on?
:15:04. > :15:08.Absolutely, we have huge plans ahead and we have just come out of the
:15:09. > :15:12.year where we reported 17% earnings growth, record profitability and we
:15:13. > :15:15.are an incredibly strong placed on which to build. Whatever the market
:15:16. > :15:21.throws at us, we have an incredibly good track record in the market of
:15:22. > :15:27.weathering storm is coming out of them stronger. So no change to your
:15:28. > :15:30.investment plans? We have to keep an eye on what is going on in the world
:15:31. > :15:33.but at the moment, absolutely no plans to change anything we are
:15:34. > :15:36.doing. We have lots of investment here and in the US and in
:15:37. > :15:43.continental Europe and we will continue to do those things. We have
:15:44. > :15:50.seen when the markets fell, a rush to safe havens like the yen, you
:15:51. > :16:00.import from Japan... Alice is different, it is different to other
:16:01. > :16:05.industries, televisions that cost ?1000 less year can cost you ?,500
:16:06. > :16:07.this year. It is emerging all the time. I don't know if it will feel
:16:08. > :16:12.different, because we can't compare with what it would be like if Brexit
:16:13. > :16:15.hadn't happened and my job is to work with suppliers and all of our
:16:16. > :16:20.stores and pay costs as tight as we can so we continue to give the best
:16:21. > :16:23.deals to our customers. That was the boss of Dixons Carphone
:16:24. > :16:27.speaking to our business editor. I promised more information on
:16:28. > :16:34.Vodafone on the website, then it is, read all about it.
:16:35. > :16:43.Our top story today, European leaders are meeting in Brussels.
:16:44. > :16:45.They are discussing the implications of a UK
:16:46. > :16:47.outside of the EU, but without
:16:48. > :16:54.The relief rally on financial markets continues today, this is how
:16:55. > :16:58.Europe is trading right now. How long will it last? We will be across
:16:59. > :17:00.every twist and turn. We've heard from British
:17:01. > :17:02.businesses about how leaving the EU could impact them -
:17:03. > :17:04.but what would happen Lavazza is Italy's best
:17:05. > :17:07.selling coffee brand. It was established in 1895
:17:08. > :17:09.in the city of Turin, and it has been owned by the same
:17:10. > :17:15.family for four generations. It's the world's sixth biggest
:17:16. > :17:18.coffee roaster by sales and has operations in more than 90
:17:19. > :17:22.countries around the world. Last year, it had
:17:23. > :17:30.a turnover of $1.6 billion. It is a brand that many know very
:17:31. > :17:32.well indeed. Giuseppe Lavazza, the vice chair
:17:33. > :17:41.of Lavazza Group, joins us now. He said that beautifully. Bidder
:17:42. > :17:47.Sally get that right? Yes, very well, perfect.
:17:48. > :17:51.We must talk to initially about the situation with regard to the UK's
:17:52. > :17:55.decision. The UK market is very important to your company, isn't it?
:17:56. > :18:00.Absolutely, one of the most important countries and we
:18:01. > :18:06.established our subsidiary a long time ago. I personally established
:18:07. > :18:11.it in 1990 and it is one of the top markets for Lavazza. So what does it
:18:12. > :18:16.mean for your business? In the short term, we have to try and mitigate
:18:17. > :18:19.the impact, for example the immolation of the pound, but in the
:18:20. > :18:26.long term, the Lavazza company is very committed to carrying out
:18:27. > :18:28.business as usual, of course, investing in the country, the
:18:29. > :18:34.relationship with the British market is very strong, we are investing in
:18:35. > :18:40.a lot of big brands in the UK, the product is very successful. We want
:18:41. > :18:49.to grow much more in the UK and of course, we are launching new
:18:50. > :18:55.products, so the plan has a different scenario and we have do
:18:56. > :18:59.try to adapt as usual. What do you think about day-to-day? We talk
:19:00. > :19:03.about big issues and there are still a lot of unknowns and uncertainty in
:19:04. > :19:08.the long term but what you do on a practical level? Are there things
:19:09. > :19:12.you can do to mitigate this? First of all, we have to implement our
:19:13. > :19:18.contingency plan to mitigate the event of the devaluation of the
:19:19. > :19:27.pound, because it will have an impact. So we have to risk protect
:19:28. > :19:32.the initiative and keep the business sustainable long-term and keep
:19:33. > :19:37.continuing to invest. So we need the reserves. It is a family business,
:19:38. > :19:42.we are not listed, we have do use our own resources. So we have to do
:19:43. > :19:45.that first. Secondly, we have to follow very carefully the
:19:46. > :19:51.development of the negotiation between the UK and Europe Anne Fine
:19:52. > :19:56.if there is some potential risk in the trading relationship -- and
:19:57. > :20:03.five. For the food and wine industry, Italian and UK, is a very
:20:04. > :20:07.important market. It is about 2.8 billion of exports in 2015 and the
:20:08. > :20:15.potential cost of this renegotiation for our system could be around 3
:20:16. > :20:19.billion euros. Is one strength for you the fact that you are so
:20:20. > :20:24.diversify as a company in terms of weight you export to and who drinks
:20:25. > :20:29.your copy? The US is a very important market, France, Germany,
:20:30. > :20:32.Italy is of course your key market but interestingly, China doesn't
:20:33. > :20:38.feature at all. Apparently they haven't got a taste for coffee. You
:20:39. > :20:41.are right. The big issue for a company like Lavazza which is very
:20:42. > :20:49.linked to copy is to try and adapt the copy to the local needs --
:20:50. > :20:54.Coffey. More and more, you need a more personal individual kind of
:20:55. > :20:58.product for different consumers. So Asia is very different from Europe
:20:59. > :21:04.and the US, because the taste is different. We have an operation for
:21:05. > :21:09.example in India, that we started in 2007 and the coffee over their is
:21:10. > :21:13.not so strong, not growing quite a lot, but China is a different
:21:14. > :21:18.scenario, you need a very specific product to be successful there and a
:21:19. > :21:22.good route market. There is talk briefly about you, the fourth
:21:23. > :21:27.generation to lead this company. Was there pressure on you to do this or
:21:28. > :21:32.has it been your lifelong love? No pressure, it is an absolute free
:21:33. > :21:35.choice. This was not the same story for the second generation, the third
:21:36. > :21:40.generation, they were forced to join a company. For me, it was different.
:21:41. > :21:45.I had a different attitude. I wanted to help my father in the business,
:21:46. > :21:49.to have a try and after two or three years, I totally fell in love with
:21:50. > :21:55.the company, with the coffee, with the business, so I decided to say.
:21:56. > :22:04.What is your favourite drink? The short espresso. Will you come back,
:22:05. > :22:09.we have run out of time? Absolutely. Thank you so much for coming in. So
:22:10. > :22:11.much more to discuss, but we have to move on.
:22:12. > :22:13.We do and we will stay with that theme.
:22:14. > :22:16.The UK's vote to leave the EU has been greeted with shock by many
:22:17. > :22:19.Some warn the UK's departure could lead
:22:20. > :22:20.to the disintegration of the EU itself.
:22:21. > :22:23.Others have seen it as a signal that far-reaching reforms
:22:24. > :22:28.He's the former chief economist of the European Central Bank
:22:29. > :22:31.and seen by some as one of the architects of the Euro itself.
:22:32. > :22:34.and seen by some as one of the architects of the euro itself.
:22:35. > :22:39.He spoke to our colleague, Theo Leggett.
:22:40. > :22:42.I think the idea of a two speed Europe never died
:22:43. > :22:45.and the UK was always, let's say, half in and half out
:22:46. > :22:48.in the past and this cream skimming has some attractiveness.
:22:49. > :22:54.So against this background, I really don't understand why the UK
:22:55. > :23:00.has not gone the way to exploit this situation to their advantage.
:23:01. > :23:04.But they are thinking, I think, this is needed,
:23:05. > :23:08.but it would be more than a nightmare, a catastrophe,
:23:09. > :23:11.if this would be the start of the collapse of
:23:12. > :23:24.Very interesting to get his take on what is going on at the moment.
:23:25. > :23:28.Let's have a look at the papers. Lots of good stories about the
:23:29. > :23:35.implications of the Brexit Road. Let's talk about what we stalked
:23:36. > :23:39.Mike Berry about at the start is -- talked about at the start of the
:23:40. > :23:44.programme. Backdating app, it is about sharing that feeling of loss
:23:45. > :23:49.and bringing like-minded people together. The Brexit debate, whether
:23:50. > :23:53.you were on either side, in the canteen, the pub, on the chut, it
:23:54. > :23:57.has sparked a lot of vibrant discussion and so to have people
:23:58. > :24:04.feeling the same way about things are connecting people... I think
:24:05. > :24:07.this is just an excuse to launch another dating app.
:24:08. > :24:12.Maybe it is an integral thing, your political views will dictate your
:24:13. > :24:18.choice of partner. I wonder if people who voted differently in
:24:19. > :24:25.couples, it could be interesting... That is a whole debate. Families
:24:26. > :24:28.have been on polar opposite sides of this debate and the divisions it has
:24:29. > :24:31.created, people would never have assumed before and that is
:24:32. > :24:37.interesting. Can we move on? Let's talk about
:24:38. > :24:40.Rolls-Royce. Familiar territory to me. Let's talk about the
:24:41. > :24:44.implications, this article in the Telegraph. It is a bit of a balance
:24:45. > :24:48.for companies like Rolls-Royce, when you have slower global growth and
:24:49. > :24:52.slower UK economy at the Brexit and thinking about that a man feel
:24:53. > :24:56.product going down, it is a challenge for profits. Then you have
:24:57. > :25:00.the pound which has fallen ten plus percent in the last few days, making
:25:01. > :25:09.what you are selling to the rest of the world as much more competitive
:25:10. > :25:11.and when you translated back into pounds in the UK, you have a pretty
:25:12. > :25:14.good profit situation. The article does point out a couple of
:25:15. > :25:17.challenges and a couple of benefits of Brexit and says Rolls-Royce might
:25:18. > :25:25.be obeyed. Challenges the you add JP Morgan? -- might be OK. Every day,
:25:26. > :25:28.we monitor and we have very intelligent management teams figured
:25:29. > :25:34.out the next state of play. It has been good having you, Nandini. It
:25:35. > :25:38.really is that issue for businesses around the world to assess what it
:25:39. > :25:42.means for them, what their plans next and how they can deal with
:25:43. > :25:46.them. In the short term, we have seen markets rising pretty sharply,
:25:47. > :25:52.the FTSE still up in early trading. We are back this time tomorrow,
:25:53. > :25:54.thank you for being with us today and we will see you then.