:00:00. > :00:00.compensate for the plummet in the value of the pound. We want to know
:00:00. > :00:14.what we can do as consumers to fight those price
:00:15. > :00:20.rises? A warm welcome to the programme. We start in Brussels,
:00:21. > :00:23.where European leaders are meeting to try and save a free trade
:00:24. > :00:29.agreement with Canada. The comprehensive economic and trade
:00:30. > :00:34.agreement has put -- has caused a public backlash and is being blocked
:00:35. > :00:38.by a Belgian regional Parliament. The row has called into question the
:00:39. > :00:43.credibility of the EU when it comes to agreeing a major trade deals. A
:00:44. > :00:46.far bigger deal, the Transatlantic Trade and Investment Partnership
:00:47. > :00:50.partnership with the United States, has yet to be concluded. And there
:00:51. > :00:57.is the issue of a future trade deal with the UK following Brexit. CITA
:00:58. > :01:02.aims to eliminate 98% of tariffs between Canada and the EU and to
:01:03. > :01:06.boost the economy is by billions of dollars, but critics say a treaty
:01:07. > :01:10.will weaken European consumer rights. This is the problem,
:01:11. > :01:15.Belgium's government supports the deal but it cannot be signed off
:01:16. > :01:19.without the agreement of the country's regional parliaments as
:01:20. > :01:25.well. The mostly French-speaking region of loonie voted against CITA
:01:26. > :01:29.and last night refused to compromise despite new concessions. There are
:01:30. > :01:33.wider implications, the row demonstrates how hard it will be to
:01:34. > :01:44.do a post-Brexit trade deal with the UK, in the words of the EU's trade
:01:45. > :01:52.Commissioner... A big story is the situation with
:01:53. > :01:58.Petrobras, the state oil dried in Brazil were for two years, Petrobras
:01:59. > :02:03.has been at the centre of one of the's biggest corruption scandals.
:02:04. > :02:08.The new Chief Executive is the man now responsible for salvaging the
:02:09. > :02:11.company, no small task, he is selling assets and striking
:02:12. > :02:16.partnerships with foreign firms to bring in vital investments as Brazil
:02:17. > :02:20.has some of the largest offshore oil reserves in the world. He told our
:02:21. > :02:25.correspondent that in five years' time, Petrobras could be back to its
:02:26. > :02:30.former glory. We have just announced a new
:02:31. > :02:37.strategic plan, this is a plan for 2017 opted 2021. However, it was the
:02:38. > :02:41.easiest part because the most important one is to deliver the
:02:42. > :02:49.plan. I think that after this period, we will see the company back
:02:50. > :02:53.to its best days. You'd think foreign companies are willing to
:02:54. > :02:56.partner up with Petrobras? The company still has the image of
:02:57. > :03:00.corruption it is trying to shake off and there is the question of very
:03:01. > :03:03.high levels of debt and there is nothing to guarantee you will be
:03:04. > :03:09.here after two years because a new President will be elected in 2018.
:03:10. > :03:14.It is not a good idea to depend only on one person although I don't think
:03:15. > :03:19.it is work done just by one person, it is worked on by a team, working
:03:20. > :03:26.very hard to really see the company at the levels I mentioned before. So
:03:27. > :03:31.this two years, your work is to improve the institution, the
:03:32. > :03:35.organisation of the company. Can you give an example? Two years from now,
:03:36. > :03:40.a completely new political group comes into power in Petrobras and
:03:41. > :03:45.the company still runs with a state mindset, it appoints political
:03:46. > :03:52.people to key positions, but that's not happen again in 2018? What is
:03:53. > :03:57.important to know is we have changed a lot of internal rules related to
:03:58. > :04:00.the decision-making process. For instance, in the past, during the
:04:01. > :04:06.days in which the problems happened, you could take a very important
:04:07. > :04:10.decision to buy or to hire or to sign a contract by just one person.
:04:11. > :04:17.It is not possible any more. You need at least two Executive
:04:18. > :04:22.directors signing of this contract, you need at least five different
:04:23. > :04:26.committees assessing this operation. We do believe that these measures
:04:27. > :04:31.will make it very difficult for anyone that would come in the future
:04:32. > :04:39.to try to break up and do whatever they want. As it was in the past.
:04:40. > :04:44.That was Pedro Parente speaking to the BBC in South America.
:04:45. > :04:48.Other news now and a big breaking story today, British American
:04:49. > :04:53.Tobacco which produces things like Rothmans and Dunhill cigarettes, has
:04:54. > :04:57.made a merger of the two American company Reynolds that makes Camel
:04:58. > :05:04.cigarettes, the biggest deal by a British company in recent years,
:05:05. > :05:08.valuing get at over $47 billion. It already owns 42% of Reynolds and
:05:09. > :05:14.this offer is for the remaining 58% it does not. Sorry huge deal.
:05:15. > :05:18.Microsoft shares have gone up more than 6% to hit an all-time high
:05:19. > :05:23.after it reported better earnings than expected. It has been boosted
:05:24. > :05:27.by soaring sales from Cloud computing business as more companies
:05:28. > :05:30.shift away from owning their own hardware and storing data in the
:05:31. > :05:36.Cloud. Mobile telecom equipment maker
:05:37. > :05:40.Ericsson says North American sales have declined in the third quarter,
:05:41. > :05:43.highlighting the depth of the crisis it announced with its profit warning
:05:44. > :05:49.last week. It said it would introduce further cost-cutting in a
:05:50. > :05:57.deal with the weaker broadband market for its business as well.
:05:58. > :06:02.I just want to bring you this story, you might remember the dam that
:06:03. > :06:08.broke in Brazil, prosecutors in Brazil have charged 21 mining
:06:09. > :06:13.executives over that dam bursting which killed 90 people and polluted
:06:14. > :06:15.hundreds of kilometres of rivers. The men were charged with
:06:16. > :06:26.manslaughter and other environmental crimes. This is some Arco Valley
:06:27. > :06:31.Brazil, this was a huge scandal -- son Marko. It costs people, 90
:06:32. > :06:36.people, their lives, and it has caused huge amounts of consternation
:06:37. > :06:38.for those mining companies, so huge story.
:06:39. > :06:46.And you like this story! Yes, I was listening to this on the
:06:47. > :06:51.way in, the suit company must brass, school promise taking off in the UK,
:06:52. > :06:55.they have been shipped in for the United States -- from the United
:06:56. > :07:02.States, and schools here, the rise of the Proms has boosted Moss Bros
:07:03. > :07:10.because of people hiring suits and increasingly buying them.
:07:11. > :07:17.Glee has a lot to answer for that! Let's talk about what is going on in
:07:18. > :07:24.the Philippines, the President is in Beijing for talks on what he calls a
:07:25. > :07:28.new commercial Alliance with China. Yesterday, he announced a separation
:07:29. > :07:31.from the United States, the huge concern in Washington. The trade
:07:32. > :07:36.Minister of the Philippines has been trying to minimise the damage caused
:07:37. > :07:41.by the President, saying the company will maintain its economic ties with
:07:42. > :07:44.the United States -- the country. Our correspondent is in Singapore.
:07:45. > :07:50.Do you think there is support for the President's move to veer away
:07:51. > :07:55.from the US and towards China? I think it has generated more raised
:07:56. > :08:02.eyebrows than support because the Philippines and the US historically
:08:03. > :08:06.have strong partnerships which has stretched more than seven decades.
:08:07. > :08:09.The statements he made a mistake visits to China about time to say
:08:10. > :08:14.goodbye to America, they were separating, has caused a bit of
:08:15. > :08:19.shock in diplomatic circles. Rodrigo Duterte is known to be the Filipino
:08:20. > :08:24.version of Donald Trump who is also known for his controversial remarks.
:08:25. > :08:31.But this is quite a shock and we have has to see his top aides do
:08:32. > :08:35.some damage control, the Finance Secretary, the trade Minister,
:08:36. > :08:38.downplaying and contradicting his remarks, said the -- saying they
:08:39. > :08:42.will not break ties with the US but will maintain their trade and
:08:43. > :08:46.economic relationship. They are looking for stronger integration
:08:47. > :08:53.with neighbours like China. Mr Duterte signed a $13.5 billion worth
:08:54. > :08:56.of deals on state visits so he is forging strong integration with his
:08:57. > :09:04.neighbour. From Singapore, thank you.
:09:05. > :09:08.We have got the markets, the Asian markets were mostly lower on Friday,
:09:09. > :09:12.partly because of the dollar climbing to a seven-month high
:09:13. > :09:16.against a basket of currencies, dragging down the price of crude
:09:17. > :09:22.oil. The Hong Kong market closed because of the approaching typhoon.
:09:23. > :09:28.Let's check in with Europe and European markets, all of them higher
:09:29. > :09:33.in early trading. The FTSE 100 climbing in London. One of the big
:09:34. > :09:38.winners is British American Tobacco, that has gone up more than 2% in
:09:39. > :09:42.share prices after a merger with Reynolds. Talking about all things
:09:43. > :09:47.American, the details of what is ahead on Wall Street today.
:09:48. > :09:52.The world's largest fast-food chain will report earnings on Friday.
:09:53. > :09:56.McDonald's has been struggling as consumer tastes move away from fast
:09:57. > :10:01.food in favour of healthier options. And lower food at home inflation is
:10:02. > :10:05.hurting the golden arches as more diners stay away. Investors want to
:10:06. > :10:10.hear an update from McDonald's on the company's turnaround campaign,
:10:11. > :10:16.pricing and the impact of wages. Also reporting earnings on Friday,
:10:17. > :10:20.General Electric. Adomah is feeling optimistic about its earnings this
:10:21. > :10:23.quarter, saying it expects possibility in its flagship luxury
:10:24. > :10:29.car division, and many will look to the results of industrial giant
:10:30. > :10:38.General Electric. It is seen as a barometer for the overall economy.
:10:39. > :10:42.Joining us now is the editor in chief of Investment Week and a
:10:43. > :10:55.regular on the programme. Shares in both the UK's tobacco companies up,
:10:56. > :10:58.claiming after this offer to buy out the rest of Reynolds, what does this
:10:59. > :11:04.say about the state of the tobacco industry? It is ripe for
:11:05. > :11:09.consolidation. When you see a mode of the site, you have two companies
:11:10. > :11:14.with strong brands and they will get rid of weaker brands, and there is
:11:15. > :11:19.difference in their geographic penetration. You talk about creating
:11:20. > :11:27.a truly global tobacco business. Reynolds the second biggest tobacco
:11:28. > :11:31.business in the US. But volumes of falling and we have a situation like
:11:32. > :11:35.that, and we are getting tobacco companies squeezed by new regulation
:11:36. > :11:39.including things like packaging and product placing where you have the
:11:40. > :11:43.health warnings, this is not a great time to be in the tobacco industry,
:11:44. > :11:48.some might say. Deals are cheap to do because interest rates remain
:11:49. > :11:53.low. And again if you look at their sales geographically, there is still
:11:54. > :11:58.growth in emerging markets, Latin America and parts of Asia, China,
:11:59. > :12:04.those parts of the world. As you say in the US and Europe, we have been
:12:05. > :12:08.on a 20 year decline in the appetite for smoking. It is more about the
:12:09. > :12:11.long-term growth prospects in some of those other countries and shoring
:12:12. > :12:17.up their revenues in developed markets.
:12:18. > :12:21.This is something that was talked about, and appetite for mergers and
:12:22. > :12:24.acquisitions, partly helped by a weak sterling.
:12:25. > :12:29.And as I said, low interest rates. A lot of big deals going on because
:12:30. > :12:34.companies think they have to do it now before they see this uptick in
:12:35. > :12:42.interest rates in the early part of this year. There is $2.5 trillion
:12:43. > :12:49.less worth of deals than in 2015 so it feels like that on more deals in
:12:50. > :12:53.terms of deal-making, but lower in terms of value. One thing from BAT,
:12:54. > :13:00.they ping is on the increase, which has taken off in Europe and they are
:13:01. > :13:03.trying to expand this. It would make sense because it is taking the
:13:04. > :13:08.appetite for cigarettes out of the market. These are big companies,
:13:09. > :13:12.they are not stupid and they see the trend for vaping. They are moving
:13:13. > :13:17.into that as well. We will leave it there, you are back to talk about
:13:18. > :13:21.the papers and all things including the Kit Kat, we will try not to eat
:13:22. > :13:23.this. It has survived so far into the
:13:24. > :13:29.programme! See you later! Still to come, how
:13:30. > :13:35.economic is editor is waiting in the wings, he is loitering! He will talk
:13:36. > :13:36.about the foot -- fluctuating pound as China's consistent economic
:13:37. > :13:46.growth. More than 5.5 million people
:13:47. > :13:53.regularly log onto gambling websites. It is a ?4 billion market
:13:54. > :13:55.would you believe. But now the Competition and Markets Authority is
:13:56. > :13:58.investigating the sector, highlighting examples are
:13:59. > :14:06.potentially unfair treatment of customers including firms misleading
:14:07. > :14:13.promotions. The senior director for consumer enforcement joins us now.
:14:14. > :14:18.Good morning. What are you doing this? Because we have had a number
:14:19. > :14:22.of concerns, people tempted into promotions that look good on the
:14:23. > :14:25.surface but they come attached with hidden and context terms which means
:14:26. > :14:30.that people don't understand the deal they are getting into and we
:14:31. > :14:34.think it makes it really hard for them to achieve any winnings and get
:14:35. > :14:38.a pay-out. We are concerned that companies are exercising too much
:14:39. > :14:41.tax at it over when they might give pay-outs and when they don't and we
:14:42. > :14:47.are concerned that they are making it very difficult for people to
:14:48. > :14:52.complain. A lot of problems in this sector. This is an industry that is
:14:53. > :14:57.trying hard to change with the times and to come under new regulations.
:14:58. > :15:01.Is it fair to be giving it such a hard time when they have so much
:15:02. > :15:04.going on at the moment? We think it is critical that we look at this
:15:05. > :15:08.sector and investigate it. The gambling commission came to us with
:15:09. > :15:13.these concerns a couple of months ago, asking us to look at it because
:15:14. > :15:18.5.5 million people are playing online. This is a growing market and
:15:19. > :15:20.those people need to be treated fairly. They need the right
:15:21. > :15:25.information to make the right choices and they need to know that
:15:26. > :15:31.the odds are not stacked unfairly against them. It is really important
:15:32. > :15:35.that we investigate this now. That is a really good pun if nothing
:15:36. > :15:40.else! Thank you very much. You could also see on our web page, you can
:15:41. > :15:43.see the response from the gambling industry. They say there is no
:15:44. > :15:48.reason to believe there is widespread failings but they will
:15:49. > :15:51.cooperate with the CMA. They say it would be wrong to prejudge the
:15:52. > :15:57.outcome of an enquiry that has only just begun. There is also a story
:15:58. > :16:02.about Homebase, the retailer Laura Ashley is to close its concessions
:16:03. > :16:05.within the outlet after the takeover of it by an Australian company. The
:16:06. > :16:10.company says most of the business in the concessions will shift to nearby
:16:11. > :16:19.stores and websites. That is all on our website on the BBC website.
:16:20. > :16:30.You are watching Business Live. A tiny region of Belgium plucks a
:16:31. > :16:34.massive trade deal for reasons that Canada and the EU are finding to
:16:35. > :16:43.understand -- hard to understand. You can go online and have a look at
:16:44. > :16:48.the package about that. Will only is the place that has blocked this
:16:49. > :16:52.massive trade deal. Plenty more on that story including a lot of
:16:53. > :16:56.pictures of cows. And we don't know if the cows are involved in the
:16:57. > :16:57.blocking, to be fair to them! Let's have a look at the market this
:16:58. > :17:16.morning. Wigan have a quick look at the
:17:17. > :17:24.economic week with a tale of 2-mac with very different economies. We
:17:25. > :17:29.had the curious Case of China's income growth and the fluctuating
:17:30. > :17:33.pound. Also the health of the coming after the vote to leave the EU. We
:17:34. > :17:36.have also had the last of the presidential debate in the US
:17:37. > :17:44.elections. Joining us is Kamal Ahmed. Let's start with the US. For
:17:45. > :17:47.the first time it seems that we have had perhaps some comments about
:17:48. > :17:53.policy. We also had an extraordinary comments from Trump about the job
:17:54. > :17:57.report in America, saying it was anaemic and terrible and the country
:17:58. > :18:03.was losing its businesses. Is that a fair assessment? The American
:18:04. > :18:06.economy in comparison to other Western economies has actually been
:18:07. > :18:13.performing relatively well. The mood in America, businesses and markets
:18:14. > :18:16.are all looking at whether the head of the Federal Reserve will raise
:18:17. > :18:22.rates by the end of the year will stop they have signalled a rate rise
:18:23. > :18:29.many times but then not followed through. Inflation is still very
:18:30. > :18:39.weak. There is no sign of any real inflationary pressure. The dollar is
:18:40. > :18:44.Tambe strong for exports, not up people think -- too strong. It is
:18:45. > :18:48.maybe not anaemic but not as positive as some may have expected
:18:49. > :18:56.but in comparison to what is going on in Europe, America is in a better
:18:57. > :19:03.position toward normalisation of monetary policy. European leaders
:19:04. > :19:07.are trying to rescue this deal with Canada. There is a lot riding on it.
:19:08. > :19:13.We have been talking about Canada plus as the model for the trade
:19:14. > :19:17.deals but it is something they cannot do overnight. This is the
:19:18. > :19:22.most important issue for the EU. We have had Mario Draghi, the head of
:19:23. > :19:26.the European Central Bank, talking about asset purchases and how long
:19:27. > :19:34.they will continue for but the real worry is this Canadian deal. Justin
:19:35. > :19:37.Trudeau is due in Europe next week. This is to show that the EU is open
:19:38. > :19:42.for business and that it can do deals but suddenly a small regional
:19:43. > :19:48.parliament in Belgium that represents 3.5 million people says
:19:49. > :19:55.it does not want to do it. That shows the difficulty. This is
:19:56. > :19:59.overlaid with the American transatlantic trade and investment
:20:00. > :20:02.partnership also not going ahead. Europe had a real challenge. If
:20:03. > :20:06.these deals are seen as good for the EU economy but don't happen, the
:20:07. > :20:11.argument is that the European economy is going to suffer. At the
:20:12. > :20:18.time of low growth in Europe more than in America, it is a real issue.
:20:19. > :20:25.Let's talk about China. Their GDP economic growth came in on target
:20:26. > :20:28.yet again! But Beijing is seeking to cool its property sector and the
:20:29. > :20:32.worries about corporate debt level are not going away and in fact have
:20:33. > :20:40.been exacerbated by these figures. The big issue in China, as they make
:20:41. > :20:44.this transition to a consumption led economy, can the Chinese authorities
:20:45. > :20:51.keep the faith of the public in economic growth which has been very
:20:52. > :20:54.strong in China for many years? And at times of stress, and at the
:20:55. > :21:00.beginning of the year there were big worries about growth, the
:21:01. > :21:07.authorities' response is to flood the market with credit, whether it
:21:08. > :21:14.is business or consumer credit. And these have led to these incredible
:21:15. > :21:19.numbers. $18 trillion of corporate debt in China, that is over 100% of
:21:20. > :21:23.GDP. These are big worries because if there is a real slowdown in
:21:24. > :21:28.China, that debt becomes unmanageable and it becomes a big
:21:29. > :21:30.problem and their credit growth is far faster than their economic
:21:31. > :21:35.growth and that always lead to tension. We can't let you go that
:21:36. > :21:42.talking about inflation rising here in the UK and that seems to be
:21:43. > :21:45.pushing through. There is not a lot of evidence yet that the weaker
:21:46. > :21:50.sterling has sped through the prices because businesses are trying to
:21:51. > :21:53.soak up the increased costs but consumers are negative about price
:21:54. > :22:02.rises. We have seen this week the first increase in inflation posed
:22:03. > :22:07.the referendum, and distilling drops, import prices for the UK, we
:22:08. > :22:13.import a lot of energy and fuel and food that will become a problem --
:22:14. > :22:17.as sterling drops. As soon as inflation goes above wage inflation
:22:18. > :22:20.there is a problem because people begin to feel worse off and that
:22:21. > :22:26.becomes a political problem. Thank you very much. We'll take a look
:22:27. > :22:31.through the business pages in a moment but first a reminder of how
:22:32. > :22:33.to get in touch with us. The business life page is where you can
:22:34. > :22:37.stay ahead of all the breaking news will stop we will keep you
:22:38. > :22:42.up-to-date with all of the latest details with insight and analysis --
:22:43. > :22:45.business live. And we want to hear from you as well, get involved on
:22:46. > :22:58.our web page. We are on Twitter macro and Facebook
:22:59. > :23:03.as well. Business live on TV and online, whenever you need to know.
:23:04. > :23:11.So what other stories have the media been taking an interest in? Lawrence
:23:12. > :23:17.Gosling is back to talk to us about those. We have at a chocolate bar
:23:18. > :23:21.sitting on the desk the whole programme! We were talking about
:23:22. > :23:29.inflation and this is the practical effect. This goes back to the
:23:30. > :23:33.Marmite story of last week. The boss of Nestl was saying they were
:23:34. > :23:39.mulling over price rises of one of the iconic products in the market.
:23:40. > :23:46.We are back to the weakness of sterling but also some of the core
:23:47. > :23:52.commodities that go into eight chocolate bar like this, chocolate
:23:53. > :23:56.cocoa, they have been going up. We were talking of air about how much
:23:57. > :24:03.one costs, none of us quite remember! It cost me 65p in the
:24:04. > :24:09.canteen upstairs! BDD go to a petrol station, you would pay more than
:24:10. > :24:17.that. Some of these retailers are pushing through price rises almost
:24:18. > :24:24.without us knowing it. Depending on the outlet that you buy from. The
:24:25. > :24:28.one person says we can eat well for less. Lovely to hear from you, that
:24:29. > :24:40.is it from us, thank you for watching. Goodbye.
:24:41. > :24:47.Good morning, it is a slow start for many of us, quite a lot of low cloud
:24:48. > :24:52.and patches of fog which at its most dent in the west of the UK can make
:24:53. > :24:53.visibility up and