20/12/2016 BBC Business Live


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This is Business Live from BBC News, with Sally Bundock


Are we seeing the green shoots of recovery for the world's


The Bank of Japan speaks of better times ahead following a fall


Live from London, that's our top story on Tuesday 20th December.


Could the shock election result in the US provide a boost


Cyrus Mistry finally steps down from the boards of Tata companies,


Markets in Europe hold steady despite the geopolitical concerns,


intensified by events in Berlin and Ankara. We will tell you all we need


to know. How do online retailers compete


when a new start-up can set up We'll be speaking to the founder


of a fast-growing fashion And if you'd like to get in touch


about any of the stories covered in today's show,


we'd love to hear from you. 2017 is looking like a brighter


year for the world's The Bank of Japan says the recovery


is now a moderate trend in a sign of better times for the rest


of the world. At the central bank's last policy


meeting of the year, they kept interest rates


at minus 0.1%. The upbeat message was because of


a weaker yen and a pickup in demand from abroad,


which offer fresh hope for an economy that's been


stagnating for more than a decade. In November, the value


of the Japanese yen fell by over 9% as investors speculated that the US


central bank would raise interest rates at its policy meeting this


month, which it did. The weaker currency has been a boost


to Japanese companies, Despite this, there are question


marks over the so-called Abenomics programme designed


to kick-start the economy. It means the central bank


is currently buying around $680 billion worth of financial


assets every year. The latest official data saw


inflation come in at 0.1%. It's better than it was


but still far below the Bank of Japan's target of 2%,


and is why the banks says "powerful And there are also concerns over


the longer-term "structural reforms" promised by Prime Minister Shinzo


Abe. These include measures


to improve employment rates Takashi Miwa is chief economist


at the Japanese bank Nomura We have got inflation at just 0.1%,


and we still have negative interest rates. There is not a lot to


celebrate, is there? The weaker yen is a factor. As far


as the governor mentioned, the bank of Japan must stay on hold for a


while to get the benefit of the depreciation of the currency to get


higher inflation in the future. Something that we continuously talk


about when it comes to Japanese economic 's is structural reform,


like an overhaul of your jobs market, when will Japan accept more


immigration to balance the ageing population and workforce? Did you


think you will get the reforms under Abe? The Prime Minister is being


urged to make structural reforms in the Labour market. Higher wages are


crucial, higher growth and higher inflation. What about the effect of


Donald Trump in the New Year? He said he wants to pull out of the


transpacific partnership, which was imported for Japan, but it looks


like Japan could get a boost from his policies? We are expecting


something positive will be coming out from Donald Trump. The situation


is uncertain at the moment, whether he will have a protectionist


approach or not. Japanese businesses are still waiting to make business


president to come in the next year. president to come in the next year.


In a nutshell, what shall outlook for 2017 for Japan? We expect that


the Japanese economy will go on a gradual recovery. The uncertainty is


quite high. The risks are from the US and from China and Europe.


One other story we're keeping an eye on is the events in Berlin.


The authorities there are questioning a man they believe


intentionally drove a truck into a crowded Christmas market.


At least 12 people were killed, and nearly 50 have been injured,


The truck crashed into people gathered around wooden stalls that


were serving mulled wine and sausages at the foot


of the Kaiser Wilhelm church in west Berlin.


Police are now describing the incident as a "suspected


We have a special page on our website for what is going on in


Berlin. It covers any new developments, any information


regarding that particular event. To take a look at our website, we are


updating it all the time. German TV says special forces have


searched an airport hunger at the temple Hof airport. They says they


have had their first hot leader following the incident.


Keep across everything as when we receive it.


There's been another twist in the Tata saga in India,


with the ousted chairman of Tata Sons, Cyrus Mistry,


resigning from the boards of all Tata Group companies.


His move came ahead of several extraordinary general meetings,


which had been called to remove him.


What is the latest on that? His decision to resign from all Tata


companies, ahead of these meetings, has come as a prop's surprise, but


they are still going ahead with the meetings. There was one scheduled


for the hospitality company, they are holding their meeting today.


Tomorrow Tata Steel will hold one. Tata don't want him to have the


final word, there want to put forward the reasons why they took


the decision, and they want to show that shareholders are on their side.


It will give a chance for shareholders to come forward and


express their point of view. There have been concerns about the way the


battle has played out in public. Tata has a very good image when it


comes to the public, but given that the warring factions put so many


allegations in the public domain, it has tarnished their reputation. We


will rely on you in Mumbai to keep us a cross that. The markets in Asia


wobbled a bit due to what is going in -- on in Berlin and Ankara.


Hopefully my team can fix the black screen. The markets in Europe


slightly up, we will hopefully bring the numbers to do. Holding steady.


The big movers on the FTSE 100 is the Lloyds Banking Group, up 1%,


they are buying a UK credit card company. They are wheeling and


dealing, and that stock is on the move.


Joining us is Trevor Greetham, head of multi-asset


I want to talk about the Italian banks, they have been in the


spotlight for some time, they are sitting on $400 billion of bad debt.


might have to step in, they are might have to step in, they are


talking about passing a vote to raise 20 billion euros. Is that a


bailout? It is nationalisation? They are trying to navigate the EU rules


on state capital injections. If they inject capital into the bank, they


have to share the pain with some of the bondholders. The Italian


Government stuck between a rock and a hard place. If they were to let a


bank fail, there would be depositors losing money, if they bail a out,


bondholders lose money. That is a bail in. A lot of the bondholders in


Italy in particular or individuals. They make themselves unpopular with


savers or savers. They have a tricky situation. They are trying to


encourage private sector capital to come in, but so far, since 2009, the


bank has had 4 billion euros of public money and 8 billion euros of


private money, it is looking for another five, and it is touch and


go. What Italy needs is some growth and inflation. And some structural


reform may be? That would help, but getting growth and inflation going


when you cannot weaken your currency is fickle. You could see the


political tension. We had the bank of Japan meeting, the last of the


central banks to meet this year. China releasing its growth figure


that it expects to hit next year. 6.5%. It is always 6.5! The Chinese


economy grows rapidly and slows down, there are interesting things,


but the official numbers never seem to change. Last year, when we kicked


off, there was a panic about China having a hard landing and the


currency was weak and oil prices were collapsing, but now if anything


the issue is the other way around, the economy is strengthening,


housing market is booming. We have seen a shift, which is what Beijing


has wanted to do. It has not been the factory floor, it is the


services. The housing market. A lot of stimulus was thrown at China over


the last couple of years, including currency weakness, and they have


turned inflationary for the world, and that is why will see interest


rates going up and bark -- bond market selling off. If the interest


rates go up, that could be a problem.


Have a Merry Christmas, it is the last time we will see you before the


New Year. How do online retailers compete


when a new start-up can set up We'll be speaking to the founder


of a fast-growing fashion You're with Business


Live from BBC News. At this time of year,


many of us will be stocking up on drinks and going out


for Christmas parties, but what we're choosing


to buy is changing. Sales of gin and rum are up by more


than 10% in the last year. Steph McGovern is in Warrington


at one of the UK's oldest gin distilleries to find out how they're


keeping up with demand. Hello. This is one of the UK's


oldest distilleries, and they have been making gin here for 250 years.


We are here because sales of gin have been increasing, it is really


popular now, up 10% over the last year. Joanne is the master


distiller. Tell us what goes into gin. It is made of three building


blocks, spirit, British wheat, water, a local water, and


botanicals. The only botanical we have to put in is juniper berries.


They come from the Toscana region in Italy. We also have coriander from


Morocco and lemon peel from pain. -- Spain. It is hand peeled, sitting


around in the Spanish sun and peeling those are. It has got eight


different botanicals, we will put them in pots. Replace everything in


there with water and spirits, heat everything up. At 80 degrees that


alcohol boils and the vapour travels up the column and goes over the Lion


arm, it's the condenser and into the receiving tanks.


Why do you think gin is so popular? It is a versatile spirit. It lends


itself well to cocktails. It smells lovely in here today. That's it from


me here at one of the UK's oldest gin distilleries.


That was Steph, of course, who looks completely sober. I'm glad I didn't


do that OB! There is a lot of detail on the


website. Second day of strikes. Hundreds of workers on strike again


today for the Post Office and Southern Rail guards as well. Keep


up-to-date. The poor people that rely on Southern Rail, I tell you


what, tough times. Our top story, 2017 is looking


like a brighter year for the world's The Bank of Japan says


its recovery is now "moderate" The upbeat message was attributed


to a weaker yen and a pick up A quick look at how


markets are faring. Holding steady given events going on


in Europe at the moment. There is talk of the Santa rally which is


historically a period of time where markets head higher in the run-up to


Christmas and in the funny week between Christmas and New Year when


some markets are open for short periods of the there is a lot of


distortion on markets because of thin trade. But that's how they are


at the moment. For a boutique fashion retailer -


trying to expand by opening new outlet stores can


be incredibly expensive. The costs of new leases,


staff and additional merchandise can One website trying to make it easier


is Farfetch, but for a price. The firm sells goods from almost 500


boutique stores to customers Last year it saw sales rise by 70%,


reaching more than $0.5 billion. Its clients don't mind splashing


the cash with customers on average Jose Neves is the Chief Executive


and founder of FarFetch. Good morning. Welcome to Business


Live. Can I start with this? What are you? Are you a retailer or are


you like a software tech company? We are a platform. We are an E-commerce


platform. We are not a retailer. You don't hold any goods. You don't have


any stuff in terms of infantries sitting in warehouses? No. We


connect the most beautiful stars around the world to a digital


platform and that allows customers around the world to shop the streets


of London, Paris, Milan, Tokyo and Calais. The logistics of this, like


getting it to the, all the items could be in one country and I order


from a boutique. The logistics of getting the goods must abnightmare?


We ship from 40 countries to 150 with no surprises. Through Customs


clearance and local currencies and local payment systems. We have 12


offices that we have local teams. So we have local teams in all key areas


and they are taking care of our customers and making sure all these


logistics are spotless and impeccable. As far as you're


concerned, you were coding at the age of nine and you grew up in a


fashion world, didn't you, really? You designed your own shoes


initially which are still selling today, aren't they? The brand is


Swear? Yes, I started programming computers. It was my passion since I


was a little kid and at the age of 19 I started my own business. Being


from the north of Portugal there is a big fashion cluster. It is close.


One hour drive from the largest fashion company in the world. My


actual customers, when I was a programmer were fashion businesses


that got me close to fashion and fell in love with that industry and


came to London in 1996 to design and start my shoe label and that's it.


We often use the word because it is banded around quite a bit, unicorn a


company that's valued at $1 billion before it goes to the markets.


That's you guys are. Is that a help or a hindrance? Obviously, it is


good for media. It gets media attention. It gets some media


attention and quite frankly it is good for recruitment because if


you're trying to recruit someone that doesn't necessarily know about


your company, they Google it and see there was significant valuation


event throughout the company. But that's it. That's not what we care


about. Just briefly, you're Portuguese. You lived in the UK,


well in London for over 20 years and you employ many overseas, but in the


UK alone 300 odd people. Yes. You're wondering if you will be able to


stay, aren't you, depending on how Brexit goes? Well, the worry is more


long-term. So 50% of our workforce here in London is not British. Not


by design. It is because we found the best dofrles or the best fashion


merchandisers or from Sweden or from the West or from Spain or wherever


they are. That's the key concern. I often joke I wouldn't have, if there


was a points system I wouldn't be given a visa package! Surely you


would get the points if you employ 300 people. At the time, I wouldn't.


Back then, you wouldn't. You're here 20 years, you are part of the


furniture! You would hope so. Say merry Christmas in Portuguese.


In a moment we'll take a look through the Business Pages but first


here's a quick reminder of how to get in touch with us.


The Business Live page is where you can stay ahead. We will keep you


up-to-date with the latest analysis from the BBC's team of editors


around the world. We want to hear from you too, get involved on the


BBC Business Live page. On Twitter we are at:


You can find us on Facebook at: Business Live on TV and online


whenever you need to know. The BBC's Dominic


O'Connell is with us. This result in France regarding


Christine Lagarde and allegations when she was Finance Minister and


they have decided she was in the wrong. There was a criminal case. No


fine and no sanction. No sanction at all. The IMF said, "We are sticking


by her." Not long ago she took over from Dominique Strauss-Kahn. He left


under a cloud. He was not convicted of anything. She has bvenlt after


allegations of assault against a New York hotel maid. There is something


about IMF and French politicians, but you can understand why the IMF


have done it, the Trump presidency, they don't want to be looking for a


new managing director right now. Is she regarded as somebody who does a


good job? She is a good figure head for the IMF, she is instantly


recognisable and very, very quotable. She is great on media. All


these things make her a good head for the IMF, you might say the IMF


hasn't covered itself in glory over the last few years, but she is


regarded as a safe pair of hands. It would have been a surprise if they


had to get rid of her. A conviction is a conics even if there is no


penalty. Monopoly set-up a helpline to stop bust-ups at Christmas time.


We play it our home. Do you have bust-ups? It can cause real dos. Do


you play it? This is a PR stunt. It is open for two days. Which two


days? It opens on Christmas Eve and finishes on Boxing Day. But really


it is just a PR stunt, Hasbro who makes Monopoly would love if people


play it. These days they are more likely to be on digital games. Is it


not so popular just like Lego. It goes on and on, Monopoly? There is a


kids version of Monopoly which doesn't have the nasty little rules


and it is over in 15 minutes. The key is you want the yellow ones, the


green ones and the dark blue ones. Yeah. The most expensive. Purple


then! Park Lane. I like coming off when


you come around the purple and the orange. You are the dog. Don't you


have a free parking rule, every time you pay a penalty? This is one of


the biggest bones of contention. The biggest thing was people stealing


from the bank! 13% of people admit to stealing from the bank! The other


thing is what is a free parking rule. I wonder what Christine


Lagarde's rules are when she plays? Sally, I wouldn't even go there!


That's it for another day. Bye-bye. Bye-bye.


We're seeing a change to our weather starting today across Scotland and


Northern Ireland. Wet and windy weather moving in here


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