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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