14/03/2017 BBC Business Live


14/03/2017

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This is Business live from BBC News with Ben Thompson and Sally Bundock.

:00:00.:00:00.

The historic move by UK Parliament to pass the Brexit bill.

:00:00.:00:10.

Theresa May is now on track to trigger the formal process

:00:11.:00:12.

of taking Britain out of the EU in the last week of March.

:00:13.:00:16.

Live from London, that's our top story on Tuesday 14th March.

:00:17.:00:39.

historic vote last night? We look at historic vote last night? We look at

:00:40.:00:48.

this milestone moment that set the stage to unwinding 40 years of close

:00:49.:00:50.

cross-channel ties. Also in the programme,

:00:51.:00:54.

in Tokyo Toshiba shares plunge as it delays its results announcement

:00:55.:00:57.

for a second time. And in Europe markets are mixed as

:00:58.:01:08.

political risk is firmly back on the agenda. Plus, will a winter storm

:01:09.:01:13.

affect the meeting of the Federal reserve? We will tell you all you

:01:14.:01:15.

We will tell you all you need to know.

:01:16.:01:18.

Later in the programme we'll hear from one of the world's leading

:01:19.:01:22.

board game manufacturers about the threat from computer games

:01:23.:01:24.

And as Levi's launches a smart jacket that can

:01:25.:01:29.

control your smartphone we want to know is it one step too

:01:30.:01:32.

Get in touch with your thoughts about the smart jacket, Brexit,

:01:33.:01:56.

whatever we are discussing this morning. We love to hear from you.

:01:57.:01:58.

We begin with the historic move on the part of the UK Parliament.

:01:59.:02:03.

Late last night it passed the Brexit bill, paving the way

:02:04.:02:05.

for the Government to trigger Article 50 so the UK formally can

:02:06.:02:08.

We expect formal negotiations to begin before the end of March.

:02:09.:02:12.

And that brings with it a period of uncertainty

:02:13.:02:15.

Last year, despite the surprise outcome of the June referendum on EU

:02:16.:02:25.

membership, Britain recorded growth of 2%.

:02:26.:02:29.

According to the International Monetary Fund it will slow to 1.5%,

:02:30.:02:36.

though this is actually up from their previous

:02:37.:02:38.

And in 2018, growth is expected to come in at just 1.4%.

:02:39.:02:48.

The ongoing uncertainty has also impacted the currency.

:02:49.:02:55.

Since the referendum last June, the value of the pound has fallen

:02:56.:03:01.

Our economics editor, Kamal Ahmed, is with me.

:03:02.:03:14.

Nice to see you. Running through some of the economic growth

:03:15.:03:21.

forecasts. Let's start at the beginning. Where are we now? Where

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does it leave us this morning? The government has got through the

:03:29.:03:31.

legislation in the UK Parliament, that means they can now write the

:03:32.:03:37.

formal letter to the European Commission, triggering the exit

:03:38.:03:41.

process. From that moment, which is likely to be the end of this month

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they have two years to negotiate, not only Britain's exit from the

:03:47.:03:53.

European Union, which is the technical issue that needs to be

:03:54.:03:57.

done there, but for the British Government they also in parallel

:03:58.:04:00.

want to negotiate a new trade deal with the European Union. A lot of

:04:01.:04:06.

people say that is a big stretch in two years, but that is the way the

:04:07.:04:10.

government wants to approach it. It has made it clear Britain does not

:04:11.:04:14.

want to be in the single market and it is unlikely to be in the customs

:04:15.:04:19.

union. Whatever the trade deal is with the European Union, it will

:04:20.:04:24.

have to be reformulated. But this is different from Canada trying to

:04:25.:04:27.

negotiate free-trade deal with the European Union because there is a

:04:28.:04:32.

free trade deal in place which will be unpicked. The government's

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argument is we are starting from a position of no tariffs and it is a

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question of adding in tariffs and they believe that is an easy process

:04:42.:04:46.

than the eight or nine year process that Canada went through to get the

:04:47.:04:48.

free trade deal with the European Union. The next couple of years will

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be defined by certain landmark moments. Triggering Article 50 is

:04:55.:05:00.

the first one. That gives business uncertainty in some respects because

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we have got a timetable, but it raises so many other uncertainties.

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Economically what do we expect to happen? The most important thing

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will be what news flow do we get in that two-year period? We may not get

:05:17.:05:20.

much, but what we will get is news about the arguments and that is

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where the Treasury is concerned. You get the rows, the conflict over what

:05:26.:05:30.

tariffs might exist in the automotive sector, the

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pharmaceutical sector. That leads to pressure on sterling. Sterling has

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lost value and it goes down and it introduces inflation into the UK and

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that affects consumer confidence. The UK economy is driven by consumer

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confidence and that could dissipate. The UK economy could slow. That is

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the worry in the Treasury's mind. It is not that we will not get a good

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deal at the end of the process, but anyone dealing with Europe knows

:05:59.:06:00.

there is often a long period of negotiation and then an

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absolutely eye watering final five days when everyone stays up all

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night and they get a deal at the very end. In that situation that

:06:20.:06:21.

two-year process is devoid of real substance and that leads to economic

:06:22.:06:24.

uncertainty. It keeps us all in a job for a while!

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So much analysis and information on our website. We have not mentioned

:06:32.:06:35.

the Scottish curved ball as well which introduces even more

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uncertainties. Have a read and dig deep. We will keep you in touch with

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every twist and turn on the BBC you can guarantee.

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14 million could loose insurance coverage in 2018 under

:06:47.:06:52.

the new Republican health care plan, according to the

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The nonpartisan group of budget analysts and economists claims

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the added number uninsured would rise to 24 million by 2026

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and reduce federal deficits by $337bn over the ten-year period.

:07:06.:07:12.

Facebook has banned software developers from using its data

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to create surveillance tools, closing off a process that had been

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used by US police departments to track protesters.

:07:19.:07:21.

The social media network says the change will help build

:07:22.:07:29.

a community where people can feel safe making their voices heard.

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And the Brokerage, Charles Schwab, has becomes the latest company

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to launch a part human, part robot financial advice service.

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It's part of a wider shift among the big banks to offer digital

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products to customers on more routine transactions.

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The service combines its automated investment management technology

:07:47.:07:48.

We are all human here, but we are trying to get the technology to

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work. I think it knows very well we are human. We have got the situation

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regarding that decision in Parliament yesterday and that is

:08:13.:08:15.

dominating the business live page. But we have got the Fed beginning

:08:16.:08:20.

its closely watched meeting. Our next guest will talk about that. I

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was a bit concerned about the winter storm and the impact that would have

:08:27.:08:29.

on Janet Yellen and and her team gathering in Washington. Their snow

:08:30.:08:35.

boots will be on. They will trek through to talk about interest

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rates. Let's go to Singapore because we are talking about Toshiba and it

:08:40.:08:41.

has missed its earnings deadline. about Toshiba and it has

:08:42.:08:42.

missed its earnings deadline. First, Karishma Vaswani

:08:43.:08:44.

is in Singapore... Explain the significance of this. It

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is the second time it has delayed its earnings announcement and it is

:08:54.:08:59.

a major embarrassment for an already troubled firm. It asked for the

:09:00.:09:03.

extension, one month this time around, until April the 11th, to

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sort out what it says are auditing problems. We have heard this before

:09:09.:09:11.

and this was the reason it gave in the previous set of announcements

:09:12.:09:18.

when it was expected to make the announcement in March. In the last

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hour there has been a news conference that Toshiba has held and

:09:23.:09:26.

the president has repeatedly said it is planning to sell its stake in its

:09:27.:09:31.

troubled American nuclear business. Nuclear is a third of the company's

:09:32.:09:35.

revenues. That division has not made a profit for the last few years. The

:09:36.:09:42.

president has also said he is hoping the company will return to growth in

:09:43.:09:47.

2018 and 2019, but the market and investors are not holding up much

:09:48.:09:51.

hope and the shares fell by 7% with that news. That was one of the big

:09:52.:09:59.

movers in Japan today. You can see that the UK index is down slightly

:10:00.:10:03.

in anticipation of an interest rate hike coming from the Federal reserve

:10:04.:10:09.

the United States. In the Chinese economy on the whole growth is on a

:10:10.:10:14.

firm footing. Hong Kong was boosted a bit by that, although it closed

:10:15.:10:20.

flat, down by one point. Let's have a look at Europe which is trading at

:10:21.:10:24.

the moment to give you a sense of how things are going. Again Europe

:10:25.:10:29.

is fairly flat. Political risk is very much on the mind of Europeans

:10:30.:10:34.

because that Brexit boat went through. Also as well we have got

:10:35.:10:39.

voters going to the polls in the Netherlands tomorrow which kicks off

:10:40.:10:43.

a year of general elections in Europe. We cannot bring you the

:10:44.:10:47.

European numbers right now, but the main markets in Europe are slightly

:10:48.:10:52.

up and slightly down. I will hand you back to bed and hope the

:10:53.:10:57.

technology will catch up with us. The European numbers are here and

:10:58.:11:01.

Richard Fletcher is here with us. Let's pick up on what Sally was

:11:02.:11:06.

talking about. We have got some clarity on Brexit last night. It is

:11:07.:11:10.

going to happen. The markets are taking it in their stride. Yesterday

:11:11.:11:15.

the pound closed up on the day despite we had the Scottish

:11:16.:11:21.

referendum news and overnight it has given up those games and some. The

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pound is at an eight-week low at $1.21. It has been a bumpy morning

:11:28.:11:31.

and we will see how that goes throughout the day. Let's talk about

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the Federal reserve. There could be a snow day. We still expect them to

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me, but the snow could get in the way. We expect some numbers to dial

:11:42.:11:48.

in by a conference call. There was a storm in 2016 and they still managed

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to meet the next day. Only a few weeks ago everyone saw another rate

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rise as unlikely and yet now it is an odds-on certainty, and 90% chance

:11:59.:12:04.

of arise. What people are looking for now is the language from them.

:12:05.:12:10.

They have said they expect to raise rates three times this year and some

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people are forecasting it could be four times. It is really about the

:12:16.:12:19.

language of the rate rise and the markets believe it is odds-on. We

:12:20.:12:23.

should be clear on the snow. They are expecting a lot. Ten inches

:12:24.:12:29.

in Washington and 20 inches in New York. Thousands of flights are

:12:30.:12:33.

cancelled, schools have closed. If that happened in London, it would be

:12:34.:12:40.

a major disaster. Let's have a look at the G20 finance

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ministers meeting in Germany. There is a lot going on. This is the first

:12:45.:12:51.

post Donald Trump G20 meeting. In the draft communiques some of the

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language has changed. We have lost that we will resist protectionism on

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all fronts, that line has gone. That appears to be a change of tone. What

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happens in the two days of the meeting, we will have to wait and

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see, but they will be a change of tone. We have got the Bank of

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England as well, so there are lots of issues for the markets to face

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this week. We appreciate you coming in. It is a very packed week.

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Come on! Give us a demo. I cannot do it. I have got some playing cards.

:13:29.:13:38.

Still to come... Keep talking, it is live TV.

:13:39.:13:40.

Playing his cards right, we meet the man behind the firm that

:13:41.:13:45.

makes cards for some of our most popular board games -

:13:46.:13:47.

and tells us how new technology is changing the oldest of businesses.

:13:48.:13:50.

You're with Business Live from BBC News.

:13:51.:13:57.

I was so impressed with that. There are so many things you do not know

:13:58.:14:02.

In the UK, Fashion retailer French Connection has

:14:03.:14:06.

Those losses narrowed to ?3.7 million,

:14:07.:14:16.

an improvement on the 4.7 million pounds it lost the year before.

:14:17.:14:19.

David Shaw is a business writer on Fashion Buying.

:14:20.:14:23.

Once it was the darling of the high street and it is now struggling.

:14:24.:14:31.

Everybody has been watching this and this once great British brand seems

:14:32.:14:35.

to have lost a great deal of traction with its original brand

:14:36.:14:40.

followers. Reading the results this morning it is on what appears to be

:14:41.:14:44.

a downward spiral which is a great shame because this brand has great

:14:45.:14:53.

potential. What is the outlook? How will it turn itself around? They are

:14:54.:15:00.

doing all the right things. I have had a look at the accounts and the

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statements and they are closing loss-making shops and they are doing

:15:04.:15:07.

quite well on Internet trading. They seem to be doing the right things,

:15:08.:15:11.

but they do not seem to be able to get people back in love with the

:15:12.:15:16.

brand. Whether they can pull the rabbit out of the hat as they did

:15:17.:15:21.

with the famous SC UK, we will have to wait and see. This business has

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been around for 50 years and everybody is hoping it will hold on

:15:26.:15:26.

and do something pretty quick. The issues to be a separation on the

:15:27.:15:40.

high street, the winners and losers are becoming clear.

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If you look at all fashion retailers they are rather limited. If you have

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a shock, you're competing with an intranet business with an infinite

:15:54.:15:56.

range. How can you hope to satisfy them? I think French Connection will

:15:57.:16:05.

have difficulty competing with this. The other issue is the problem of

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huge foreign investment, these people are on a massive scale so it

:16:16.:16:21.

is being pitched everywhere. That is another problem. People feel French

:16:22.:16:35.

Connection are overpriced. Top story, the UK Parliament has passed

:16:36.:16:43.

the Brexit Bill. Theresa May has the formal process of taking Britain out

:16:44.:16:47.

of the European Union. Let's have a look at how markets are faring. We

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have had problems with the graphics today for some reason but just to

:16:53.:16:58.

say the value of sterling went up slightly and then has been falling

:16:59.:17:04.

back today. The sheer markets are pretty flat. Treading water.

:17:05.:17:15.

Elections are expected to change this in the Netherlands tomorrow.

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You all probably owned some phone mood by next guess.

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Belgian-based Cartamundi is one of the worlds biggest manufacturers

:17:28.:17:29.

of playing cards and board games - making family favourites including

:17:30.:17:33.

and the firm has manufacturing facilities all over the world,

:17:34.:17:48.

including in Germany, Poland, Mexico, the US and India.

:17:49.:18:07.

That is where it all started. The ancestry of the company goes back to

:18:08.:18:26.

1765. It is the reason why they were so expensive, and why the cards

:18:27.:18:34.

still detect the kings and queens and Jackson jokers who used to play

:18:35.:18:47.

with cards. Tell us how you got from the humble playing card to this sort

:18:48.:18:51.

of stuff? The way that people play obviously progresses. To stay

:18:52.:19:00.

relevant we have to keep our factories busy with products that

:19:01.:19:05.

are relevant, great experiences for people to play with. The purpose of

:19:06.:19:10.

the company is to share the magic of playing together. Talk us through

:19:11.:19:15.

how the relationship works. You make the games we've all heard of. But

:19:16.:19:24.

you don't actually sell it in the stores. Other companies do that.

:19:25.:19:31.

Talk us through your competitors. The Lubbock we have games

:19:32.:19:43.

manufacturing services. We make electrical card games, that is the

:19:44.:19:51.

business of games manufacturing services. You have shifted where you

:19:52.:19:57.

make things from China to the United States because of your relationship

:19:58.:20:03.

with Hasbro, four example. When the game market grew by 15% last year.

:20:04.:20:12.

It has been growing exponentially in core markets, one of them being the

:20:13.:20:19.

United States. In order to capitalise, you need to manufacture

:20:20.:20:27.

the products closer. You would imagine something that is

:20:28.:20:34.

traditional is suffering from computer game. I want to show

:20:35.:20:41.

viewers this. Explain what this slightly high-tech thing inside the

:20:42.:20:48.

card is about. This is a printed intelligent near Field communication

:20:49.:20:52.

card. It is a new form of electronics which can be printed.

:20:53.:20:57.

Traditional electronics are silicone but that is metal oxide. It enables

:20:58.:21:04.

electronics to be able to integrate into everyday paper-based items. In

:21:05.:21:09.

the future your cards will be intranet enabled, your board game

:21:10.:21:15.

will be able to connect and give you a different game experience than

:21:16.:21:18.

before. Taking all technology and making it very new. Yes but still in

:21:19.:21:25.

a fast, fun and easy way. At the end of the day it is the game experience

:21:26.:21:31.

that matters. Thank you so much for coming in. I love playing with these

:21:32.:21:33.

cards. We like you to get in touch with the

:21:34.:21:45.

stories we are covering and one of them is about this smart jackets

:21:46.:21:57.

that tells you what's going on. It is a jacket attached to your

:21:58.:22:01.

smartphone and it can tell you the time, let you listen to music...

:22:02.:22:21.

The goal for Google is to provide access to their favourite services

:22:22.:22:29.

and information from everywhere and anywhere at any time. Whether they

:22:30.:22:33.

are biking walking or cycling, they should be able to access their

:22:34.:22:43.

favourite services. Tell us what is here. This is integrated into a

:22:44.:22:49.

portion of the cuff material. The thread that capture your gestures

:22:50.:22:55.

integrate and are transferred to the little tag. You have the destination

:22:56.:23:07.

and it tells us this. You can control the music from the cuff of

:23:08.:23:09.

this sleeve. That would drive me insane.

:23:10.:23:27.

Everybody else around you as well. Dominik is with us. That jacket,

:23:28.:23:35.

would you wear it? It would drive me insane. Imagine being on a train.

:23:36.:23:41.

What about when it malfunctions and you're in a meeting. One person

:23:42.:23:52.

says, not so smart, give the not so smart something new to play with.

:23:53.:24:01.

Jasper says I'm not convinced wireless signals are safe so I would

:24:02.:24:08.

not wear it. We've had quite a few people talking about it but nobody

:24:09.:24:16.

has said they want to wear it. Wearable tech was going to be the

:24:17.:24:20.

next big thing. It has not taken off. A lot of people are wearing it

:24:21.:24:25.

on their arrest. That is wearable tech. It is but it's not a jacket.

:24:26.:24:32.

Let's talk about oil prices. We thought they were going back up.

:24:33.:24:44.

They'd finally agreed production cuts but it has gone down. Last week

:24:45.:24:50.

it went down 9%. It was $55. Now it is down to 48 dollars. Not just

:24:51.:24:58.

because it is having difficulty maintaining this but also the second

:24:59.:25:05.

she'll revolution in the states. The biggest ever oilfield discovered.

:25:06.:25:12.

The numbers are out from the US Department of. They are on course to

:25:13.:25:18.

produce an extra million dollars -- million barrels of oil a year. It's

:25:19.:25:24.

an astonishing new source for production. That has a huge impact,

:25:25.:25:39.

economically. Oil is important for everything we buy. Transport costs,

:25:40.:25:43.

driving the world economy. It is going down. Most to see you. Thank

:25:44.:25:50.

you. Sally is going to teach me more card tricks. I am. Thanks to your

:25:51.:25:54.

company. Goodbye. For the next couple of days it looks

:25:55.:26:13.

pretty settled. Things

:26:14.:26:14.