18/07/2016 BBC Business Live


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Hello, this is business live from the BBC. Turkey into a mile, the


government tries to reassure investors after the failed military


coup. We ask what's next. Live from London that's the top story today on


Monday 18th July. In an emotional speech, the


president of Turkey has vowed to cleanse the fibres from the Turkish


state, despite strong words investors are concerned about his


role as leader. We will get an expert outlook on the Turkish


economy. Also Japan's should go ahead, despite concern


over Britain's decision to leave the EU. We don't have the numbers for


you, they are all heading high in Europe, shares in ARM Holdings


jumping by a Ford is explicit. Also in the programme, what is it like to


drive one of biggest car companies in the


UK as a woman. We will be hearing from Linda a little later. And one


British firm is trying to find out why a high proportion of people


living in Sardinia live to over 100. They have bought the genetic data.


We would like to know if you would like to live till over 100 or is


this just research for the I am nearly 100, it's the incredible


make-up team that fools you! The military coup had failed in key


dominated headlines this weekend. The government is trying to reassure


investors that the country is under control of the government and the


economy and the outlook is sure. Yet the reaction was swift on Friday


when this emerged, the Turkish lira tumbling by almost 5%. It has


recovered a little since then. This was the biggest one-day fall for the


Turkish currency since the financial crisis of 2008. Also the central


bank was swift to promise unlimited liquidity for banks and the Deputy


Prime Minister has taken to social media, trying to reassure investors


that the economy's fundamentals are strong. And of course there is


concern about the Turkish economy with the tourist industry, key to


economic growth, having had a tough year. If you look at the way things


have been since May, the all-important tourist sector


slumping by one third on the previous era. That's foreign


arrivals continuing to fall. What is the outlook?


Joining me now in the studio is Cornelia Meyer, chief executive


of Meyer Resources but also on the advisory board


A very warm welcome, lovely to see you. We heard about the measures


that the government is trying to use to reassure investors,


is it enough? I don't think it will do the trick.


Let's look at the two dish economy as a whole. Manufacturing is


important as well. 3% of global oil supply goes through


the Bosporus and another 2.15% comes


from pipelines from the Caspian Sea, from Russia and Iran, into


Europe. It is a crucially important country.


What gives me hard is that it has strong middle-class, a typical


middle-class economy, 12,000 dollars a year per capita.


It is a strong middle-class which means strong


consumer 's but definitely they need to arrests and arrivals. We should


be heartened by the fact that the Bosporus was only closed for a


couple of hours and then opened again although it is important to


Europe what happens there. It's an important time to Europe that we see


is stability because you say there is a strong middle-class yet


it is polarised. Some are for the government and then there's a strong


group which is against it. And add to that the problem with what


happened over the weekend, we have had the terrorist


attacks in Turkey this year, several in


several key locations. Absolutely. What we have to see if that Turkey


is the furthest east and post of Nato, the furthest east output


have in surgeons but you also have Isil. You never


There's a lot of people with guns don't mean well around. And that is


difficult. Yes, the government will crack down quite heavily and you


know that in Europe we have a very democratic view, but on the other


hand we do need to Turkey to be stable. We really do. It is the most


We mention that you are on this advisory and the stumble summit.


What will you be advising them to deal with the challenges


they faced -- the Istanbul summit. We've already had a lot of talks.


Our key topic will be geopolitics. We'll do a big


panel to look at how geopolitics affects Turkey, but then we will


have our usual panels and financial markets where we have London and


Frankfurt, all the financial markets, seeing how they interact.


with a strong focus on geopolitics, to help investors get a handle on


what is going on. Thank you for joining us.


We will keep an eye on the situation on Turkey, updating you on what


develops. Now some other business stories.


The new minister in charge of Brexit says the UK should be able


to formally trigger its departure from the EU "before


David Davis called for a "brisk but measured" approach,


with a likely exit around December 2018.


The head of Tesla - Elon Musk - says he's optimistic a software


update can improve the firm's autopilot system on its cars.


The electric car company has been working on changes since May,


after one of its sedans failed to detect a tractor


trailer in bright sunlight and crashed into it.


Mr Musk hasn't given any details on when the update might happen.


We can look at what is on the live page on the website, at the top,


Brexit may lead to property caution. Expect occupiers and investors to


take a more cautious approach after the referendum result, it says. And


the story we have mentioned, arms shares


soar -- shares in ARM Holdings are soaring. It really is dominating the


UK business News today because it is such a big story. It has been the


jewel in the crown of British technology for


quite some time. Let's look at it in more detail. The


Japanese bank agreeing to buy one of the UK's biggest tech companies.


We've been following the story. Karishma Vaswani has been


following the story. A pricey punt, as one analyst said


to me, and also a big bet on the future, the CEO of the Japanese bank


is known for his crazy ideas and with this acquisition it looks as if


he is betting on the Internet of things. That means, it's a future


where your fridge, your washing machine, even your hairbrush,


basically turns into a computer. Everyday objects transformed into


intelligent analytical machines. ARM Holdings


does not make the chips that power these devices but it does design


them, and that is what Softbank is buying, the technology behind the


Internet of things. Since Brexit the value of the pound which was been


talking about on the channel for the last couple of weeks has fallen and


the Japanese yen has strengthened. ARM Holdings may be cheaper. Bank to


buy than it was one month ago. While we have seen shares of ARM Holdings


in the UK soaring, it is not clear how the Japanese and's shareholders


react. Remember that Japanese stock markets are closed today because of


a national holiday. The bank is in $100 billion worth of debt and an


expensive acquisition may not be what shareholders want now. How do


you think this will be food there, is it a vote of confidence in


post-Brexit Britain, or just trying to strike while the pound is weak --


how will this be viewed? I think it is very much about what the Japanese


bank sees its business strategy as in the future. I do not think this


decision by the CEO of Softbank was taken because of Brexit alone. I


think it may be cheaper than it was just before Brexit because of the


weakness in the British band that may have factored into the


ultimate decision that has come through -- in the British pound.


Thank you for your thoughts. action in Tokyo today, given that


ARM Holdings story, we will see a reaction in Japan when it reopens.


Hong Kong up slightly. This is the way that Europe is


trading now. The big winner today is ARM Holdings, up Ford is


exposing to be open. -- up 46%. The offer that came


through from Softbank was around ?17 a share. Markets reacted


immediately. We are seeing gains


across-the-board. We'll talk you through some of the reasons why, in


a moment, first, let's get the text to Wall Street in what we can expect


in New York as we start the trading week.


Donald Trump is scheduled to accept the nomination from his party as


president on July 21. Banks will continue reporting this week,


kicking things off on Monday will be the Bank of America followed by


Goldman Sachs on Tuesday and Morgan Stanley on Wednesday. Because of


market volatility and ultra low US interest rates, banks have been


under pressure. Investors are keeping expectations low the coming


quarters. A few other companies reporting this week, America's


largest car maker, General Motors, Microsoft, Novartis and family


streaming service Netflix. Joining us is Trevor Greetham,


Head of Multi Asset Good morning. A bit of excitement.


It is worth bearing in mind that ARM Holdings is a massive American


dollar earner and its share price already went up after Stirling


depreciated. about the currency angle, it is more


that the Japanese yen has been the Gijon's strongest currency


over the year and we are about to see this


long awaited bazooka from the bank of Japan


and the government, the fiscal manager is diminished.


Softbank is thinking, let's get in there while the yen is strong


pound is low. It seems that timing is everything, in terms of


timing while Theresa May is our new Prime


Minister, her thoughts about companies taking over other


companies? She has only said they will be scrutiny of


this morning Philip Hammond has tweeted


that Britain is open for business and has lost none


of its allure. When it comes to selling the


family silver presence and jobs in the UK!


Interesting point, some of the overdue as they are making, they


plan to double the UK workforce and keep


ahead, presumably sensitive to the concerns that might follow?


Bear in mind that ARM Holdings employ 4000 people so it won't


change much in UK unemployment although it


is a positive story. In general, your thoughts, we are


waiting for news on how the UK economy is doing after Brexit.


So far it hasn't been great, housing surveys, consumer confidence, other


things Nirvana stayed where they've had a


lot of stimulus talks thrown at them and we


haven't yet seen the bad data, it's like coming to A E and getting an


injection and you feel good to start with, I feel we will see worse


economic data. The Bank of England can offset the


shock value structural hit and they will not be


able to offset that damage. We should see a slow is


economy. I welcome the fact that fiscal austerity is over. I think


the Brexit Again it would be easier to reverse


austerity if we stayed in the EU because we want have more


money to share! It would seem that we are not!


I don't know about when you have had injections but I always get a


arm to begin with! Lovely to seal. Travel will be back soon.


He's got more to do. Still to come, what


is it like to be a woman in a man's world? We'll be speaking to the only


female ever to become the boss of a French car company later on.


The financial and economic implications of Brexit


Two reports out today paint a fairly gloomy picture.


Joining us from the Business Newsroom is Andrew Walker,


Well, we have got the ITEM Club which is economists that put


together forecasts. They are predicting a mark slowdown in growth


in the British economy in the aftermath of the referendum vote,


1.9% for this year, not so bad, but down to 0.4% in 2017, and then


picking up a bit to 1.4% the year after. They do note that there will


be some benefit for exporters sart of the decline in the value of


sterling, but they expect to see some significant slowdown in


business investment. The other report picks up on that theme of


business investment. And that is from the accountants Deloitte. They


have been doing a survey of chief financial officers at some of the


companies in the FTSE 350 index and large privately owned companies and


they found that 82% of the finance chiefs that they surveyed are


expecting to cut back on capital investment spending in the near


future. That's up from a figure of 34% when they did it a few months


ago. So, not entirely down to the referendum result, but Deloitte


think that's the major factor in the pronounced increase in people


planning to cut back on investment spending. We get the information now


given the fact that the Bank of England chose to do nothing last


week? Yes, isn't it just? The EY item forecast is very much the Bank


of England will cut interest rates and we have had strong indications


that it is likely to happen in August. Also worth mentions that the


survey of chief financial officers was done at a time when uncertainty


was at its greatest after the vote, but before we knew who the new Prime


Minister was going to be, there is a bit of political stability comeback


which could affect the view that some of the finance chiefs take


going forward. Andrew, for now, thank you very much indeed. Two


interesting surveys out today, that he highlighted there.


There is more details on the website or the app. You can look at the live


page. Our top story, the Turkish lira


has recovered ground in the Asia trading session


following a failed military coup. The country's president has vowed


to "cleanse the virus" Lots more information on our


website. It is changing rapidly. So we will update you.


Let's get the Inside Track on an industry which is


attempting to "jump-start" its stalled reputation.


The diesel emissions scandal has rocked the motoring sector and now


manufacturers are looking towards electric as an


The French car giant, Peugeot Citroen, has unveiled


an ambitious five-year plan which will see the company develop


seven plug-in hybrids and four electric vehicles.


The group has also become the first carmaker to publish "real-world"


Despite this, like many other European manufacturers,


Brexit poses a threat to Citroen's business.


Britain is the French carmaker's third biggest market.


Citroen's CEO is Linda Jackson, an industry veteran who's worked


Recently, she was voted the most influential British woman


Earlier, the BBC's Victoria Fritz caught up with the boss of Citroen.


She started off by asking whether a slowdown in Europe


and China posed a threat to the company.


Of course, we look at the size of the markets,


but if we take China, for example, yes, it slowed down it is not


the double digit increases that we were seeing two or three


So there is still a market there and I think it is about for us,


it is about making sure that we are flexible as a company,


to be able to profitable and to produce vehicles that people


will want to give them an experience that they want,


recognising that the world is chaothic, that's the way


the world is now and Europe is stable in terms of the of


it is not double digit, but it is single digits,


there is lots of places that we as a company are not present


so for example in parts of South East Asia where we're not


present so there is plenty of opportunities so I think


it is about you accept the market is like that.


I don't think there is going to be a sudden drop completely in


How much has the diesels emissions scandal really


You need to be careful because before anything blew up


in term of the Volkswagen issue, we had already seen the diesel


market going down slightly and it is a steady trend.


For me, in the future, what will change in terms


of that is what legislation comes out because at the end


of the day for me it is not manufacturers certainly not,


but it is going to be what government legislation,


We have some towns and cities declaring there will be no cars


by 2025 there will only be electric cars, we're saying OK,


we're going to have many options for our customers so we can react


whatever the legislation maybe and that means that we have very


clean diesel and petrol engines, new generation, award winning ones,


we have electric strategies so we have electric vehicles.


We will have electric vehicles even more by 2019,


and we have what we call plug-in hybrid electric vehicles


so the customer will have a choice depending on his circumstances


Do you think your industry is sexist?


I don't think it is sexist, but do we have enough


I'm often asked this question and I don't have the answer for it


as to why they are at not, why are there not more women?


When you look at who buys cars, 50% of my customers are women.


When you look at who is behind the decision to choose the car,


Because we choose all those things. So why are women not interested in


entering the automotive industry? It probably goes back historically to


be, it was seen as a macho world, very engineering led. And it is not


anywhere? I'm not an engineer and you know I understand how a car


works, but I am not somebody that's going to open the bonnet and tinker


around and really get into that. I see more women coming up through


younger women coming up, but there is still a lot of work to do in


terms of, you know, at the end of the day, why are there not more


women? Well, one of the reasons, it is about trying to find the life


balance. Do you think you manage your work-life balance personally?


Have I personally? Well, I have step-children, I don't have a


family, I didn't have any children of my own and that was a choice and


that's about basically I don't think it is fair and I don't think it is


possible to be able to do the job I do right now, it is an enormous job,


you know, it is 180% of your time and you have to make those choices


and you know, I always congratulate people and I encourage people who


are trying to do both, but it is very, very difficult.


That was Linda Jackson there the boss of Peugeot Citroen.


Let's see what other stories are being talked


What other business stories has the media been


Trevor Greetham Head of Multi Asset at Royal London Asset Management,


Let's talk about Tata Steel. This is a story we plucked from the Sunday


papers. It is the Sunday Telegraph talking about the sort of


negotiations and failed negotiations going on between Liberty Group which


really wanted, it was very interested in Tata Steel's


operations in Port Talbot. Now it looks like Tata are doing a deal


with a German company. Again, Tata Steel is a foreign currency earner


from Theresa May's point of view, she will be desperate to keep steel


capacity open to earn foreign currency. So any deal that's struck,


there will be a lot of scrutiny and politically it is a hot potato and


interestingly, it seems what Tata are saying is well, maybe we'll hang


on to this asset and go into a joint venture rather than selling it. This


could be a pretty profitable facility later on. It is quite an


interesting turn around isn't it? When you think about in March of


this year when Tata Steel were put up for sale and it looked desperate.


It looked like thousands and thousands of jobs were about to go


and now here we are, where we are. A big currency devaluation helps in a


commodity industry like steel. Let's move on to this one. The secrets of


living to over 100. A British Biotech firm is trying to discover


that will. There was gathered the data of 13,000 residents in


Sardinia. What do you think? I have a view on this. There is a


difference between mortality and more bidity which when you are


alive, but can't do much! People are living longer and they have got to


be healthy and more active and there is evidence that people are healthy


and more active and I wonder whether or not after looking at the gene


pool in Sardinia, they will find out that people walk a lot and exercise


and diet were more of the issue. Gosh, exercise and diet. I nearly


brought my gym kit, but I left it at home!


Thank you for coming in. And thank you for your company. That's another


Business Live. We will see you tomorrow. Bye-bye.


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