20/01/2017 BBC Business Live


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Live from London, that's our top story on Friday the 20th of January.


Slashing taxes, talking tough on trade and ripping up


America's President-elect promises double the growth


Plus his arch rival China confirms its weakest growth since 1990,


with fears of even tougher times ahead.


And given the inauguration today, one word dominates the markets,


that's caution. And we'll be getting the inside


track on the mining industry. The founder and chairman


of one of the world's largest mining companies -


Vedanta Resources - will join us. We'll get his thoughts


on the Trump presidency, and likely drivers for


commodity prices this year. And we also want to


know your thoughts - Are you optimistic or pessimistic


about the new leader of the free Or dump! Welcome to the programme.


Lots going on, we've got that Friday feeling.


Later today Donald Trump will be sworn in as the 45th President


The billionaire businessman has gone from long-shot candidate


to the leader of world's biggest economy in just a year and a half.


His supporters will now be hoping that he can shake up the US economy


in the same way the he shook up the presidential race.


Let's take a look at some of the details that we know.


He has promised to create 25 million jobs over ten years,


and to double the annual rate of economic growth to 4%.


He's promised to take a tough line on trade -


and on countries he sees as undercutting US workers


He's threatened to slap a 35% tariff on Mexican imports and a 45%


tariff on products from China, raising fears he could


One thing at the top of the list that we know he has said:


the North American Free Trade Agreement.


He also says he'll cut America's high corporate taxes -


which have pushed big US firms to offshore a lot


Critics say this is too expensive, and will help big companies rather


And he also promises... A lot of promises!


He promises to free up business by ripping up red tape -


he says 70% of all federal regulations can go.


He hopes that will encourage firms to keep more jobs in the US


The markets certainly like the approach, and the so-called


Trump Rally saw the benchmark Dow Jones industrial average rise


Laura Tyson, Professor at Haas School of Business,


University of California Berkeley and former Chair of the US


President's Council of Economic Advisers joins me


Thank you for joining us. 25 million jobs in ten years. Can he do that?


25 million jobs over ten years is actually an estimate that I think


probably keeps up with the demographics of the labour supply,


and is not a number that is out of range given a 10-year time horizon.


There were something like 22 million jobs, I believe, during the Clinton


Administration, I think. So that number is not the number I would


look at. I would look at the growth rate number, which I think is not


believable, the 4% growth rate. Talking about jobs, we saw some


figures saying the US has lost about 5 million jobs since 2000, but 80%


of that is due to automation rather than jobs being outsourced


elsewhere. That's right. And I don't think people really understand that


point. I do think the voters understand that. I think that any


reassuring that occurs in the United States -- re-shoring that occurs.


While they might have 20 workers to do a job abroad, they only need five


in the United States because of automation. Typically after a 2-term


president, typically a recession follows after that. I don't think


that there is any theory which would suggest that to be the case. In the


US economy, we have had a long period of economic growth, we have


brought ourselves back in many parts of the country to follow employment.


We still have the secular problem of employment creation that we talked


about in terms of technology. I do think that is going to continue, but


the economy is not right now, there are not obvious imbalance is, which


would suggest that there would be a recession, so I don't buy the notion


that there will be a certain period of years before you go into


recession, whether or not there is a period of change in administration.


I think you look for in balances in the economy. He has also suggested


major tax cuts for corporations, will be enough to bring offshore


back to the US? I do think one thing with certainty, thinking about the


economy over the next year and several years, we will start with


what we know for sure. We know for sure that the Republican Congress


with the president will introduce significant tax cuts, personal tax


cuts and corporate and business tax cuts, and there will be a need given


the tax cuts to make sure that there are not large differentials between


various forms of business taxes like pass through taxes for corporations,


and corporate tax, so all these rates will come down. The president


has proposed a very aggressive cut in corporate tax to 15%. Businesses


have been looking for rates in the mid-20s, so 15% is a very low rate.


One thing I would say about all of this is that there really is a


tremendous reduction in the source of revenue for the Government, and


that then is associated with lots of cuts in various spending programmes,


so I do think that you are going to see for sure significant cuts in


taxes. A cut in the business tax rate, the corporate tax rate, will


almost certainly bring more investment into the United States,


more capital investment, so one of the things that has been true about


the economy is weak capital investment. Thank you very much your


time this morning. It looks cold! Good snow. Says the lady who just


got back from skiing! Let's look at some of the other stories making


headlines all around the world. President-elect Donald Trump's


choice for Treasury Secretary, Steven Mnuchin, has faced strong


criticism during a Senate Mr Mnuchin is a former Goldman Sachs


banker-turned hedge fund boss He faced accusations


that his former bank, OneWest, ruined lives during the US property


crash by foreclosing But he told the Senate Finance


Committee "I have been maligned". Uber is paying $20m to settle


allegations that it duped people into working


for its ride-hailing service. The US Federal Trade Commission said


Uber offered false promises about how much drivers would earn


and how much they would have The agreement covers statements Uber


made from late 2013 until 2015 while trying to recruit more drivers


to expand its service and remain You are sitting down, you are doing


it! I am doing the tablet. It is all about Trump today. We asked you


start if you are optimistic or pessimistic about the impact you


think trouble have the global economy. Already have some! This


reader says, I am cautiously optimistic, another one is


pessimistic. Some others also saying that they are very pessimistic.


Let's wait and see. I'd lots on the tablet from both sides, as well. Now


let's talk about the second biggest economy in the world. Official


growth figures out of China. And they confirm that last year


China's economy grew at its slowest pace in more


than a quarter of a century. The growth rate hit 6.8 per cent


in the last three months of 2016 - but that gives an overall rate


of 6.7% for the year - The figure is in line with Beijing's


official growth target Robin joins us from Shanghai. Do we


trust the numbers, and what I really want to ask you is, if Trump sticks


to his promise and causes a trade spat with China, that is probably


the last thing the Chinese economy needs? Yes, on that first point, do


we trust the numbers? There is always scepticism, but let's set


that to one side for now. These numbers are bang on what the Chinese


government have predicted. The trend of the slowdown continues, it is a


managed slowdown in growth that the Chinese government want, and that is


their overall aim. Looking to next year, we can look to see something


in the low 6%, perhaps. But the bigger picture here as you say is


that China is preparing for a Trump administration where it doesn't


quite know what he will do. We have had the rhetoric, but there is fear


about a trade war and possibly about a physical, military confrontation


in the South China Sea. The main concern for the Chinese government


is domestic, it is about trying to transform the economy here away from


being one reliant on government money on exports, we saw a big drop


in exports in those figures, and make it instead an economy driven by


domestic and consumer spending. Robin, have a good weekend, we will


talk to you soon. Let's stay with the markets.


Caution is the key word on the markets around the world


as we all await for the 45th president of the US to be sworn in.


Even China's economic growth which beat expectations and Federal


Reserve Chair Janet Yellen who toned down her earlier hawkish policy


stance hasn't been enough to give a real boost.


They are waiting to see what Trump and his team put together in terms


of economic policies. So on that note - I wonder


what'll be making the biz US financial markets have been


jubilant ever since Donald Trump's surprise election win, hitting a


series of record highs. Now that he is about to be sworn in as the 45th


President of the United States, will Mr Trump continue to make markets


great again? Stocks initially rallied on the hope that the


incoming administration would deliver an campaign promises to


rollback regulations, cut taxes and spend on infrastructure. Lately they


have been trading in a narrower range, someone in investors have


been too focused on the upside, and haven't given enough thought to the


potential negatives. At present, Wall Street doesn't seem to be


anticipating problems either with Mr Trump was my trade policies or in


terms of delays by Congress. Will that view change once he takes


office? And on the corporate front, watch out for earnings from the


likes of General Electric and doctor and Gamble.


Thank you, Michelle. Joining us is Lawrence Gosling,


editor in chief at Investment Week. Thank you for coming in this


morning. The husband a lot of noise around the markets, Theresa May


outlining Brexit, the Chinese president in Davos, Trump's


inauguration, but underneath all of that, how other markets doing? There


is an outbreak of what you call a traditional business cycle but


economists look like that starts with a recovery in the US which we


have had for the last couple of years, filters over to the UK and


moves across the world. The UK is hungry -- the UK economy is healthy,


there are signs that Europe is beginning to pick up, and a lot of


people perhaps confused by China, Brexit, an interesting time for the


markets. I will take a sharp turn and talk about, we just mentioned


that Trump and his team will look at the North American Free Trade


Agreement, lots of criticism to Mexico, but Mexico provides United


States with about 80% of their avocados, and I can tell you what


they love, they love guacamole in America! Particularly on Super Bowl


day which is coming up! The avocados were banned a hundred years ago from


going from America into the US, Nafta brought them back, and the


Americans have been gobbling them down. We could see and do that, it


would be a very small thing and it sounds trivial, but it is a piece of


populist protectionism that might make Donald Trump unpopular. We will


see! Do come back and take us through the papers. My father in


Australia had an avocado tree in his backyard.


Still to come: We'll find out what the head of one of the world's


biggest mining companies is expecting from


You're with Business Live from BBC News.


The Association of Convenience Stores is calling upon


the government to do more to support the UK's 19,000 rural shops.


Hit by rising costs, a lack of high speed broadband


and business rates - they're struggling.


More than half of rural shops operate on their own,


with no other retailer close by and are therefore essential


Well let's find out more with Chris Noice,


We heard what the issues are, what do you want the government to do


about it? The report is highlighting the concerns we have about the


viability of some rural shops, they are absolutely providing an


essential service to communities across the UK. We want them to look


at rural petrol stations, many of them are fully serviced convenience


stores and they are not receiving the same rate relief that there are


other rural counterparts are, as well. Many rural stores are


disadvantaged by slow broadband speeds and slow mobile coverage.


With many things going online it is important that these stores have a


level playing field when making investments. Regarding investment,


stores that are improving their business, spending money to make


businesses better and more appealing, they are actually being


dis- incentivised and we want to see that being changed. With Brexit, and


what that has done with the value of the pound, it makes things more


expensive for these shops to bring their goods in, are they telling you


that? They don't have the buying power like the huge supermarkets.


You are right. The buying power is different, but I think it is more of


a secondary impact for the convenience sector because many


stores source their goods locally and we have done research and the


impact of Brexit is not hitting yet. It will be interesting to see how


this changes in the next year. We appreciate your time. Thanks.


There is a story on the tablet. Royal Mail, cost cuts ahead, tough


times could be coming up again, because of a fall in the amount of


letters we are sending. Send us some letters! There is an 11 month low


for the share price. You're watching Business Live -


our top story - later today Donald Trump will be sworn


in as the 45th President The billionaire businessman who has


gone from long shot candidate to the leader of world's biggest


economy - is promising to bring A quick look at how


markets are faring. The word is cautious today. They are


waiting to see what Donald Trump will do when he act she gets into


office. -- he. He has promised infrastructure investment and low


tax rates, which could appeal to businesses, but they are holding


their breath. Trump and China are likely


drivers for commodity Meaning the future for


natural resource companies But Vedanta Resources,


one of the world's largest mining companies is unafraid


of potential protectionist policies. But has he largely


ignored the negative possibilities of tit-for-tat trade


wars with China and other countries? Anil Agarwal founded the Group in


1979 and is the Executive Chairman He joins us now from


the World Economic Forum in Davos. Can we start with this, global


companies like yours, you need free trade to create jobs and boost


growth, what is your message to Donald Trump? Yeah, we have a very


good relationship with America and India. Our companies, our company is


1% GDP of the country, we produce oil, zinc, aluminium, and I've been


hearing about his speech and to support his country for more jobs. I


think Brexit is doing the same. India are doing the same. Trump is


doing the same. Everyone has to hold onto their people and create more


jobs I think he will look at that. He will look at this as a win-win


situation where everybody can win, but as far as our country is


concerned, we have a very good alignment with America. I want to


ask you this. I will give you a break so you can swallow.


Responsible leadership has been a big theme at Davos and we have got


to ask you, your company has come under scrutiny, you have been


criticised about your environmental impact. A team of top analysts in


your country in India have described the data as being in total contempt


of the law. No, this is absolutely incorrect. We are one of the world's


best. We ranked one of the best. When you are in the resource


industry you have got to be very careful and we use technology today.


We are a new company and we can't do anything which is not right. Our


environmental norms. India hardly produces anything and India has only


done anything, about 10%, compare to the world, 90%, we import most of


our oil and this government is completely looking to how we reform


and make more oil and gas in the country and more copper in the


country and how to open up the resources sector and how to do the


start up. And create a phenomenal jobs, and for the world to come and


invest. This is a huge market. It's a huge market. We are going to leave


it there. We appreciate your time, as always. Stay warm. We are joined


again by Laurence. We are going to talk about our paper


stories. We have that tweet, what you think about Donald Trump?


Optimistic or press mystic. Story here about his Treasury Nonna --


treasury nominee who contradicted the president. -- optimistic or


press mystic Donald Trump says he would like a


weaker dollar. But this is a conflicting view. The treasury


nominee is saying a stronger dollar is better. Well, the treasury


nominee is going to get more respect because he has an economics


background. The Treasury Secretary would hopefully understand the


direction the country needs to go. The dollar needs to stay strong


longer term. This is a good thing, they are having a discussion, these


are the checks and balances will stop people are worried Donald Trump


will do what he wants, but these are the checks and balances. Yes, the


nation is not schedule challenging. Exactly. Sticking with that theme.


Here goes the tablet. Inauguration ball. Michael Flatley to perform at


the inauguration ball. Not quite perform, he has rickety knees, but


he will lead his dance troop out and perform. He is most like the last


man standing who actually wanted to agree to appear at this ball. What a


comparison to the Obama ball. Yes, but I'm sure they will have fun,


watching Michael Flatley. Being British, we go for Marmite. It is


wonderful. Anyway, that you might is back in the hands of the Aussies.


They will try to rebrand it, so it is not just for breakfast, you can


have it all day long. You can have it with cheese in sandwiches, I have


that at school, lettuce is very good with vegimite. Always a pleasure.


There will be more business news throughout the day on the BBC Live


webpage and on World Business Report.


Good morning. It is a big day on the other side of the pond in Washington


and we're expecting to see cloud thickening up and likely to bring




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