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This is Business Live from BBC News with Ben Bland and Aaron Heslehurst.
International investors go cold on South Africa,
as one of the continent's biggest economies moves from political
Live from London, that's our top story on 12th April.
As South Africa's battered economy tries to recover
from a double downgrade, protesters are heading
We're live in Johannesburg for this developing story.
Also in the programme, the BBC understands that the head
of security at Barclays is now facing an internal disciplinary
probe over his part in a whistle-blowing inquiry.
We will get all the news from the markets.
And we'll be getting the inside track on one start-up
that is taking used batteries and giving them a second life.
As the boss of United Airlines, we want to know when have you wished
you'd apologised sooner? As South Africa's president
Jacob Zuma celebrates his 75th birthday, the festivities may be
rather more low key than usual. In less than a week,
the country's members of parliament are scheduled to hold a vote of no
confidence against the president. It comes after he ousted some
of his key political opponents Today, members of the public
are expected to take to the streets in protest at the move,
but Mr Zuma's decision also has South Africa has been downgraded
to "junk status" by two of the leading debt ratings
agencies, Fitch and S They argue that the reshuffle
will hamper the country's efforts The government's debt pile continues
to grow and the loss of its "investment grade" status
could have a significant impact on South Africa's ability to borrow
money on international markets. It means that major institutions
such as pension funds and hedge funds may be prevented from buying
the country's debt. Viv Govender is in our
Johannesburg studio. She's a senior Analyst
for Rand Swiss. What is president Zuma up to with
all of this? Why the moves? Is he to blame with what's going on at the
moment? Yes. Look, if you had to go and
basically do a prediction of why he's doing this, I think the general
conspiracy theory is he is going to be out of power by December. He
wants to put his ex-wife into his position, both at the ANC and in
Government afterwards and those basically would be in order to
protect him from any kind of criminal prosecution thereafter. In
order to achieve that goal of actually bringing his wife into
power, you may need to indulge in patronage for his supporters and
that could not be done with a Finance Minister in place because he
would prevent some of the irregular expenditure that would be required
to basically convince the supporters for both him and his wife in the
coming election. So he's prepared to do all of that at the threat of
hammering the South Africa's economy. Unemployment is 25%. I mean
that's a whooper at the moment. Could that go higher of the back of
what we're seeing at the moment? And 25% by the way is just the official
number. If had the people who were already employed, it is probably in
excess of 40%. The problem that we have in South Africa is that some
people have been unemployed for a long period of time that the number
of discouraged workers is probably 15% and maybe 20% of the total
workforce, people that are sitting at home for two or three years and
have given up the search for a job. If you included them, it would be in
excess of 40%. This would be a major impact on those workers. Over the
last couple of years the only real source of long-term or formal sector
employment in the country has been the public sector. If you look at
the public sector pay rolls they have been increasing over time.
Things such as social work and other things come out as one of the top
categories when we look at the employment numbers coming out. The
private sector hasn't been as strong especially the mining sector has
been under a great deal of pressure losing hundreds of thousands of
workers over the last couple of decades. If you had the Government
unable to borrow money, firstly they couldn't spend as much as they would
have to reduce the amount of workers in the public sector which would be
quite difficult and the private sector as well is not out there
really looking at employment opportunities. They are looking at
cutting down on the number they have because of the regulations around
labour, etcetera. Viv, we appreciate labour, etcetera. Viv, we appreciate
your time. Thank you for joining us. And no doubt we will talk to you
soon. The BBC understands that Barclays's
head of security is to face an internal investigation
over his part in a Troels Oerting allegedly assisted
the bank's boss, Jes Staley, in his attempts to unmask the author
of an anonymous letter, which questioned the past conduct
of a senior recruit. UK financial regulators
are investigating the scandal and we will be getting more on this
from our markets guest, Toshiba shares are down by nearly 2%
in Tokyo trade this morning. The Japanese conglomerate could face
delisting after it finally But it was done without
the endorsement of its auditor. Toshiba is trying to sell
its its crown jewel, the chip business, to offset huge
losses from its US nuclear The head of United Airlines has
apologised for what he now describes as "the truly horrific removal"
of a passenger from CEO Oscar Munoz at first told
staff he stood by them, but with United's stock market
valuation plummeting, he issued another statement saying
he was disturbed by the incident. We are looking at the Business Live
page. Check it out. We will talk about Tesco later on. There is more
on the Barclays story. There is a full write up by Simon Jack
explaining this line that the bank's head of security now faces
investigation over this trying to unmask a whistle-blower. I want to
do paint. I bought five meters of paint, ?96 of that's about $140 for
five litres! It says tensions are rising between
the owner of Delux and Elliott Advisors.
Changes to a stamp duty loophole in Hong Kong have sent
Well, as you said Hong Kong, the Hong Kong Government slapped a 15%
tax on first time homeowners who are purchasing more than one flat at a
time. So, what was happening was investors were coming in, snapping
up multiple units in one go to qualify for lower tax rates. These
buyers were using one legal contract and they only had to pay 4% tax duty
so now they are being charged the same 15% as someone buying a second
property. There has been a lot of Chinese capital snapping up some of
the Hong Kong's best plots of land and at record-breaking prices and it
has pushed home ownership out of the reach of many people who live there
and the Government hopes that closing this loophole will help the
average buyer, but of course, Hong Kong is one of the most expensive
real estate markets in the world. Sarah, thank you very much indeed.
Investors ducked for cover on Wednesday as a drumbeat
of alarming geo-political news sent the safe-haven yen and gold
to five-month highs and yields on top-rated sovereign bonds
Gold climbed as far as $1,280.30 at one stage, its highest
The unease has tarnished an otherwise brightening outlook
for global economic growth and has kept equities restrained.
Japan's Nikkei feeling the pressure as a rising yen weighed
Shares are down in Tesco and WH Smith.
That's despite Tesco reporting profits better than analyst expected
and WH Smith reporting a rise in profits as well. Barclays shares
recovering after their slight fall on Tuesday. That's all to do with
the news that the investigation involving the Chief Executive and
how he handled a whistle-blowing situation. The BBC now understanding
that the head of security at Barclays faces an internal
disciplinary probe over his part in that inquiry.
Here's what's ahead on Wall Street Today.
United Airlines has been getting a lot of attention recently,
but it will be another carrier that will be in the spotlight
Delta Airlines will be reporting earnings, but don't expect them
The number two US airline by passenger
traffic for the second time in less than a month has
lowered its forecast for passenger revenue.
Now Venezuela is due to make a $3 billion payment on its debt
by Wednesday and this would be yet another test for the country to stay
solvent in the face of political unrest and low oil prices.
And finally, the New York Auto Show kicks off with a media
This comes as car sales in the US have gone flat
after two consecutive years of record-breaking vehicle sales.
Maike Currie is investment director at Fidelity International.
Great timing. You're South African. We want to ask you about this - junk
status by Fich and Standard and Poors. That's what they have issued
to South Africa. Junk status, just to explain, junk will make it
awfully expensive for South Africa to service its debt and to borrow
more money? Absolutely. What investors demand they want a higher
return to actually lend to a country. Now, what has been
interesting from an investment point of view is that despite the junk
status investors have been piling into South African bonds so that's
pushed up the price, the yields and the income return has fallen. Now
the question is whether this is about the political reactions in
South Africa or whether this wb short-lived which I doubt. I think
it is more symbolic of a broader optimism around emerging markets. So
what would be interesting if you look at the performance of emerging
markets since the beginning of the year, they're up over 10%. They've
performed twice as well as the US and Wall Street which has performed
twice as well as London and the general consensus was a Trump
presidency would be bad news for emerging markets and the tightening
by the Fed would be bad. So it is interesting times. Yes, indeed. I
want to turn our attention to Barclays. The BBC understanding that
the head of security is facing an internal probe. The shares have been
on a roller-coaster. They seem to be recovering today? The interesting
thing about the banks more generally is with inflation rising and the
prospect of interest rates going up after years of record low interest
rates, that's good news for a bank's business model. That will bode well.
Of course, the whole whistle-blowing scandal is another cloud hanging
over Barclays. Are you going to come back and take
us through the papers? The United boss gets around to saying the S
word. Charging into the future,
we speak to the CEO of a company that's pioneering a way to make
money by squeezing new life out You're with Business
Live from BBC News. Food sales has helped push
supermarket giant Tesco to record Like for like sales are up 0.9% -
it's the first full year of growth since 2010 but profits
are down after settling an accounting scandal
with the Serious Fraud Office Maureen Hinton is from
retail analysts, Verdict. Hey, Maureen, do you think, it is a
good number, but Ben and I were looking at the share price of Tesco,
did you say 1.8% down? Down nearly 2% of the what's investors thinking
here? I don't know to be quite honest. I
think it is perhaps because the operating profit wasn't as high.
They were hoping perhaps that it would go up to 1.3%, but the
business is doing really well. It is improving. The customer experience
has improved. It is winning customers back. Better availability.
Availability. The operating margin is improving. It doesn't make sense.
It might be because of the Booker acquisition, but I think there is a
lot of growth opportunity with that because they're wholesalers and they
can supply where all the growth is going at the moment which is through
food service, through take-aways, we're changing our eating habits so
they have got a good growth story there as well. It is the same
actually. It tends to go down and go back up again the share price.
It's facing some challenges, its reputation, it was dealing with that
fine over the accounting scandal. It has potentially got a battle with
suppliers over the increased costs being passed on because of the
weaker pound. Yes, it had a couple of battles with Unilever and
Heineken more recently. Because it has such big buying power, and
perhaps because CEO Dave Lewis comes from a supplier background, it has
good negotiating skills. Thank you very much indeed, Maureen from
retail analyst Verdict. HSBC plans to become dementia
friendly. I think this is a cracking story. They are outlining their
plans today to becoming more dementia friendly bank. HSBC says it
gets 3000 calls per month regarding power of attorney, which is a big
issue for people suffering from dementia and their families.
Our top story - South Africa's president Jacob Zuma is facing
increasing political and financial turmoil as the country's economy
It may be his 75th birthday today but that won t stop huge protests
against his leadership that are expected to take place today.
A quick look at how markets are faring.
A firmer start to the trading day across Europe. The main indices all
in positive territory. That follows on from a more cautious day of
trading in Asia where investors responded to geopolitical moves with
stuff going on around North Korea and tensions between America and
Russia. The Korean peninsular. That's sent goals to higher levels
and safe haven bonds as well. Currencies, the Japanese yen, going
into the Swiss franc as well. Japanese exporters don't like that.
And now let's get the inside track on the business of batteries.
Nearly every one of us uses lithium ion batteries every day -
they power our smartphones, gadgets, and now even some electric cars!
In fact, one report says the market for lithium ion batteries
is expected to exceed $33 billion by 2019.
But what happens when you get rid of your old phone or gadget?
One start-up firm, called Aceleron, takes these
end-of-life batteries, and turns them into
second-life battery packs for other applications.
Aceleron says its technology helps to reduce waste
by re-using these batteries, and produces low cost energy
Let's find out more, Carlton Cummings is co-founder of Aceleron.
I love this idea, great to have you here. For us dummies, like me! How
does this work? Do you take a laptop and electric batteries? That's
right. We take batteries from consumer electronics, laptops and
stuff like that. We can also manage batteries all the way up to the
electric vehicle. Most of the time the batteries, even though the size
or scale might be large, that chemistry is the same, so that's why
we can work on small scale with laptop batteries and batteries all
the way up to the electric vehicle. We identify the good ones, repackage
them into batteries for other things, devices you would put your
phone or tablet into, all the way up to a battery that plugs into your
home. Using examples, I found this fascinating when we spoke before
coming on air, these batteries still have charge in them. Explain that. A
great example is the battery in your remote control. When it doesn't work
for the remote control, you can put it in a clock and it works just
fine. Batteries don't die, they degrade. We need to know where they
are in their cycle and what they can be used for. The tragedy where we
are right now, we take batteries when they are not good for their
first application and we throw them away. The worst part is we don't
have the recycling capacity to do that, so we have to export it, and
it's very expensive. Why would you export something that still has
value, and that's where Aceleron comes in the. If you have batteries
that still have charge in them, why haven't manufacturers done something
about this to make sure you can use the battery right up until when it
is completely empty? Typically that's when you get into the science
of battery. You don't want to use the lithium battery all the way down
to empty for its application. You could liberated from a laptop when
it's done there and put it into a power bank and its fine. But we are
stepping down the ladder. That's why a battery from a car would be at
home power in your house. Mobility is one of the hardest things to do
with a battery, so you could free up the battery. We have developed the
technology to test it quickly and find what it can be used for. That's
one of the reasons the industry hasn't done it, identifying the way
to do it quickly. We developed the technology to do that. So that's
what you've done? I like the phrase, "Powered down to knackered" that
must be a Barbadian quote! I have been inspired by a lot of things
going on. I come from a background in engineering. I worked as an
engineer for a motorcycle racing team. I also worked in renewable
energy, coordinating solar installations. I had the insight
from both worlds so I saw the opportunity with the electric car.
When some of the cars are no longer useful, or when some of the
batteries are no longer useful for the car, there is still energy in
there to power a home. Why wouldn't we use that? You have been listed on
the Forbes Magazine 30 under 30 list. It's a very high-profile
thing. You also the Shell entrepreneur of the year. Have you
had interest from investors? We had quite good interest. We always are
happy to engage a couple of other persons and are happy to bring
others into the team. The major thing is that a lot of these events
and stuff have been able to get us the owners we need to do the job we
want to do. -- the onus we need. This interview has now powered down
to knackered! You are only a very early start-up, it's a pleasure to
meet you. You registered in August last year, so great stuff and best
of luck, Carlton Cummings. In a moment we'll take a look
through the usiness 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 with all the day's breaking business news. We will keep
you up-to-date with all the latest details with insight and analysis
from the BBC pars team of editors right around the world. We want to
hear from you. Get in touch on the BBC live web page. We also on
Twitter and Facebook. On TV and online, wherever you need to know.
Sorry seems to be the hardest word. The United airlines boss has finally
said it. We can start with that one. It was a PR disaster. It was. It's a
lesson in poor public relations and the power of social media. We had
every man and his dog watching this video of the horrific incident. Then
we saw the letter the chief executive sent to employees backing
up the behaviour of the crew being circulated. In China there was a
report distributed by millions of Chinese readers saying the man was
targeted for being Chinese. All of this, the chief executive has only
just come out now with a statement. It's a sorry piece of paper, when he
should have been out there immediately with a genuine apology.
This type of thing can destroy a big company's brand within seconds.
Because of the power of social media. The chief executive needs to
be out there with a bold and genuine apology across channels. I was
hearing, apparently last year this Chief Executive was named
communicator of the year. The irony couldn't get worse. It is quite
ironic. We have a couple of tweets. We asked if he would regretted not
apologising later. Barry says he will immediately apologise and he's
afraid it doesn't come across as sincere as it is.
I want to talk about another executive change at Uber. Yet
another one. What's going on? It ties nicely into the issue of how
damaging negative publicity can be to a company. Uber has struggled
with a string of bad publicity disasters. Its top PR person, who
they recruited from Google, has now left. What has happened at Uber is
that it has struggled to attract employees because of its reputation.
Only joined in 2015 as well. Thank you for coming in as always. Time to
wrap it up. We are out of time. More business news throughout the day and
on the website.