20/04/2017 BBC Business Live


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Hello, you with business live. Campaigning in the UK in action gets


under way today. Antonio to Johnny will meet with


Theresa May at 10 Downing Street this morning. The European


Parliament made it clear what its so-called red lines are in the


negotiation process. And we will talk you through what is at stake.


Also in the programme, Emirates reduces its flights to the US. And


looking at the European markets, they are treading water and


relatively mixed. Of course, that first round in the election on


France is on Sunday. Traders are gearing up for that. We will take


you through the markets a little bit later. Now, it might taste good, but


could it also do good? We will meet the woman behind the chocolate brand


which is co-owner and by farmers in Ghana. Also, as Facebook begins work


on mind control technology, we want to know, is mind control and social


media a risky combination? Just think of the havoc it could cause.


Let us know what you think. A very warm welcome to the programme. So,


once again we start with our focus on what's going on in Downing


Street. In less than an hour, the head of the European Parliament is


due to meet with British Prime Minister Theresa May. That's Antonio


Tajani, who is visiting as the UK prepares for an election which will


be dominated by Britain's exit from the European Union. The European


Parliament has a vote on the final Brexit deal, but is not involved in


the process. However it has set out a series of what it describes as red


lines, that it will not compromise on, something Antonio Tajani will no


doubt discuss with the reason may later. Let's tell you what we know


about those. So, the European Parliament wants the final agreement


to make sure the UK continues to comply with a range of EU policies


on various issues, such as the environment, tax evasion and


competition. It also stresses the United Kingdom


must honour all its legal and financial obligations to the EU


- including its agreement to pay That could mean a hefty exit bill -


a figure put by the European And one that's bitterly


disputed by some in the UK. Notably by the so-called Brexit


secretary David Davis. And it insists two major EU


regulators currently based in London - the European Banking Authority


and European Medicines Agency - will also have to move


to the continent. Some in financial markets are now


betting that getting the election out of the way in June will allow


the UK to be much more flexible in agreeing to these demands -


and avoid a so-called "hard We can now get the view of a


political analyst from King's College London. In one sense it


makes her life easier because she will have to pass a lot of


legislation to make Brexit happen. With a bigger majority, which


pollsters expect, that will be easier. I don't think it will affect


the European Union lose position, though. They will not care one way


or the other what size her majority is in parliament. I think they will


fair negotiating position, and that fair negotiating position, and that


won't change. How important is today's meeting? The European


Parliament is not involved in the negotiations, but it does have to


sign it off at the end of the two years? Yes, it is curious, we are


not negotiating with the European Parliament but we need to keep them


on site. The worst of all worlds is that the European Parliament says,


we don't like this, we going to vote it down, which they can do. So


keeping them on side is important. They have described some of these


things as red lines which can't be crossed. The divorce bill of 60


billion euros, already, David Davis says it is nothing like that. Yeah,


that figure has been bandied around by the European Commission as a


possibility. I think the first stage of negotiations will be to figure


out what we should be including in our bill and what we shouldn't. I


don't think that figure is set in stone, but I think the EU is making


it clear that whatever figure they arrive at, we have to pay, we cannot


get around it. Emirates will reduce flights to five


US cities from next month, after new security rules targeted


travellers from the Middle East. According to the Dubai-based


airline, "recent government relating to the issuance


of entry visas, heightened security vetting and restrictions


on electronic devices in aircraft cabins have had a direct impact


on consumer interest and demand Consumer goods maker Unilever


reported better than expected first-quarter sales on Thursday,


helped by pricing growth. Underlying sales rose by 2.9%,


beating analysts' estimates of 2%. The results could boost investor


enthusiasm for Unilever, whose shares have remained higher


since February, when it received, and then quickly rejected,


a $143 billion takeover offer Premier League football clubs


posted record revenues of ?3.6 billion in 2015-16 -


according to research by Deloitte. Manchester United topped


the earnings table for the first time since the 2003/4 season -


with revenue of ?515 million. Still, the top 20 English clubs made


an overall pre-tax loss after two seasons of profit -


hit by higher player wages, operating costs


and other one-off charges. Japanese exports saw


their biggest gain in more than two years in March -


a sign of optimism for the world's third-largest economy,


which also boosted Asian markets. Let's go to Sharanjit Leyl, who's in


our Asia Business Hub in Singapore. A real boost for exports? That's


right. Exports in Japan growing 12% in March led essentially by a strong


demand for auto parts, optical instruments such as mobile phone


parts and tools to make semiconductors. While imports were


also up nearly 16%, which is mainly to buy all the coal, oil and energy


needs to fuel the economy. We also heard from the International


Monetary front, they have just rooted Japan's economic forecast,


projecting a 1.2% annual expansion this year. And there was a key bank


of Japan business confidence survey, which pointed to rising optimism


among big manufacturers. All in all, really good for Japan, although I


should say, the Newquay ended fairly flat, with worries about the French


elections and north Korea. We have also seen the Japanese Prime


Minister who has been trying to achieve this economic growth for


years and end what has been a long period of on and off deflation


through a policy blitz of easy money stimulus as well as reform. So,


despite that great news about exports, as we heard, the Nikkei


ended pretty flat. The Dow Jones was down. Quite a lot of earnings


stories out of the US also which did not impress. IBM and eBay among


them. In Europe, all eyes on France, as we


head into the weekend, with voters deciding who they want to be the


front runners in the presidential race in France. That's how things


are going in Europe right now. We'll talk some more about trade in a


moment. But first, let's look ahead to the day in the United States.


And Michelle Fleury has the details about what's ahead


The SNP 500's losing streak stretched into a fifth day. Doubts


about Donald Trump's ability to fulfil his progress promises are


behind that. Investors are hoping that first-quarter earnings will be


strong enough to justify those lofty valuations. Of the more than 50


companies in the SNP 500 that have turned in their report cards so far,


75% have done better than it did, according to data from Thomson


trend continue? Among those trend continue? Among those


reporting quarterly profits come visa, cigarette maker Philip Morris


and toymaker to picky. The number one US wireless carrier is expected


to decline for a fourth straight quarter. Investors want to know how


it will respond to rival AT's move into TV and content.


Joining us is Alix Stewart, Fixed Income Fund Manager, Schroders.


Good morning. We have been talking all week, and tomorrow is a big one,


with a lot of the manufacturing news come can you explain the


significance of these manufacturing PMIs? Well, obviously we have seen


strong economic both through a lot of the world. And on the other side


of the political stuff that has been dominating everything, we will be


focusing back on what is actually happening in the economy is. We get


that focus back, as you say, during the week, when the IMF upped its


growth forecast for the UK, for Japan, for many economies, actually.


And so it is quite interesting how the news coming through about


various economies in the world seems to be getting better, even the


inflation figures in the Eurozone yesterday were not as robust as


people had feared, with worries about petrol going up etc? Yeah, we


seem to be in quite a nice phase at the moment many we're getting a


cyclical upswing globally perhaps for the first time since the


financial crisis. And inflation is not a worry at the moment. Speaking


of prices going up, let's talk retail sales. We will get the


figures tomorrow. We have had results from Debenhams this morning.


That is a big department store chain here. But it is interesting because


ten stores are up for closure, a big warehouse and distribution centre


potentially at risk. This is being replicated around the world, these


big department stores really struggling? Well, you've got three


things going on. You've got the fact that consumers are being squeezed as


prices go up, if income is don't keep pace with that. We have seen


here in the UK that people are dipping into savings to keep


consumption going. So there are big question marks specific to the UK.


But globally, we have got this issue with department stores, people are


shopping in a different way now. We will talk more about Debenhams a bit


later. For now, thank you very much. We meet the woman behind


the chocolate brand that says it can make a difference for


cocoa farmers in Africa. You're with Business


Live from BBC News. Sky and HBO have announced


a co-production deal worth ?195 million, and have also promised


a "ground-breaking" virtual reality experience in partnership


with Sir David Attenborough The announcement comes as Sky


reports sales up 11% to ?9.6 billion It also comes a few weeks


after the Culture Secretary, Karen Bradley, referred 21st


Century Fox's bid for Sky Let's get more with Alex De Groote -


media analyst at Cenkos. Nice to have you on the programme.


Skype coming out with so many different bits of news, what is your


take on the HBO deal? They have a long-standing arrangement with HBO


whereby probably half of the output that you would see on sky at


Atlantic already comes from HBO. In a way, this development cements that


pre-existing relationship. Sky in the UK for some time now has been


going down the path of higher quality, more expensive drama.


Primarily through sky at Atlantic also through some of their other


channels. So, this is more of the same but it is a big commitment and


should be seen as a real positive for HBO as well. And also, it is


what these companies have to do, they have to have that content that


viewers want to tune in for, that's what it's all about, isn't it? It


is, this is the golden age of TV, maybe the second golden age of TV.


One reason for that is the amount of money which is being put into this


high end drama by the likes of Sky. If you go back 10-15 years, a lot of


based around paying up for the footy based around paying up for the footy


and hoping to draw in subscribers on that basis. That has kind of come to


the end of the road now, so this is about trying to get perhaps a


slightly different democratic, with pretty high end drama, starring guys


who previously would only have worked in film. Boyd thank you for


your time. As promised, a reminder, much more on the Debenhams story. It


is part of a plan already being announced but clearly there are now


implications for some stores. Ten hour before potential closure, one


of those is loss-making, the other given some sense to prove


themselves. You are with Business Live, our top


story today, we are focused on the head of the European Parliament. He


is at Downing Street today meeting with the British Prime Minister to


discuss of course the Brexit negotiations. We will have more on


that story in a moment. Quick look at the numbers for you. After a


pretty volatile week, calling off the snap election, markets and


occurrences not sure I'd one point what to make of it. You can see as


the FTSE 100 is finally back in positive territory after a week of


losses so far, on the back of that. But the FTSE 100, because most


many of you may have been indulging over the weekend regardless of where


you live in the world on chocolate. Many of us enjoy a sweet treat -


but how do you combine that urge Well, our next guest


believes you can do both. She's the boss of the Fair Trade


chocolate maker, Divine. It's co-owned by a co-operative


of cocoa farmers in Ghana and exports to more


than ten countries. Last year, it had a turnover


of around $15 million - not bad, when you consider it's


a social enterprise. Sophi Tranchell, is Group


Chief Executive and MD And she has brought lots of slabs of


the staff as well, over the studio. We had the out of the hands of a


floor manager and manager and directors and various others to give


it in the studio. Nice to see you, welcome. Let's start with the


product, because I think it is really interesting. Defoe got


involved in this, you had no experience of retail, no experience


of chocolate, and yet you are now running this global chocolate


business. Tell us your story. I had a tin chocolate, so I did know what


it was! I was running a film distribution company and a cinema


group in London, and we were distributing foreign films, so we


brought in that in America films, and the early Almodovar films. We


were getting people to watch subtitled films and back in the 90s


young people didn't do that so that was quite a challenge. I saw an


advert in a newspaper, a very little advert, because they were recruiting


a team to run Divine chocolate, they already had the name, the recipe of


the first buyer and the ownership structure, and I just thought it was


a great project. The idea that it was owned by a cooperative of cocoa


farmers in Ghana that would get the benefits from the money that


chocolate lovers spend on the chocolate was just an irresistible


combination. My thought it was a great idea and inner way I had


nothing to lose, because I had no experience in retail at know how


difficult a task I was taking on. I hadn't really recognise that you are


entering into a category dominated by enormous Tom Preece la global.


It just seemed a lovely idea, why wouldn't you want to lead chocolate


that tasted great that would give benefit to farmers? When you think


of the big names in chocolate, it is almost David Empoli of, Nestl and


Cadburys and all those dominant chocolate brands but the less about


how this company works because it is very unusual. Even people like Anita


Roddick have been involved, the founder of the body shop. It is all


about ethical shopping and consumption. Yes, it is about


offering people all over the world who like chocolate a genuine choice


to buy something that taste nice, a big range of products, but also they


know that the farmers really benefit because they own 44% of the company,


which means they have a seat on the board. They also get a share of the


profits. It puts them much higher up the supply chain. Farmers who grow


cocoa trade it on the international market, and that is very volatile.


So the idea that they actually have a share in the chocolate company


means they get a share in the world they are hoping to create. We are


looking at pictures in Ghana, the fair trade logo is there. How has


that changed, because I imagine when you started out doing this, there


was a lot of education, but fair trade mean, have that affect farmers


in Africa? People are more aware about where things come from the is


there still an education involved? When we first started, people didn't


know where chocolate came from, when you ask them, of course it comes


from Switzerland or Belgium. That idea that cocoa comes from West


Africa, 70% of the world's, and it makes a difference to the plight of


the people who grow at how much you pay for it was completely foreign.


So we were changing the narrative of the industry and fair trade was a


nice way to do it. We had now people expect to behave properly


to people in their supply chains, but there are companies that are


turning a better and more thoroughly than other companies and there is


now a whole range of products you can buy. Lots of things like clothes


and stuff. Time is up, sadly, I could talk all day, but Sophi thank


you. Lovely to see you. Let's return to the top story. We explained that


the head of the European Union Parliament is meeting with Theresa


made today in Downing Street. Vicky Ford is a member of the European


Parliament in the UK's governing Conservative Party. She joins us now


from Cambridge in her is to Viglen constituency. Thank you for being on


the programme. Tell us about this meeting and how important it is,


given that the European Parliament won't be involved in the negotiation


at all. The European Parliament is important because it has a vote on


the outcome of negotiations. Santonio the journey is a new


president of the parliament, dresses beginning of this year, quite a


practical and pragmatic person and he clearly wants to find an ally


couple relationship with the UK, post the negotiations as well, so


this is very good that he is coming to Downing Street -- Antonio Tajani.


The Parliament's position as set out in a vote that we had just before


Easter is quite in line with the UK Government position on a number of


issues. I am interested in the story on the front of the FT, Brussels


starts to freeze Britain out of EU contracts. You might expect this of


course, the UK leaving the European Union so maybe we are not entitled


to have an active role in some of those contacts, but how worried


should business be? It uses very specific examples are saying that


Britain should not be invoked if it is not a member of the club. I am


very interested in that, because Parliament's position is very clear


that until Britain leaves the EU, we haven't left, so they should not be


pre-emptive conditions like that. Key priorities like making sure that


British and European citizens rights expected, both sides agree on that.


Key issues on financial contributions, the European


Parliament does not put a number on the ball, but they say that Britain


should pay its commitments and the Prime Minister has said we are


prepared to pay our commitments. So again there should in principle be


an agreement on these issues, and then we need to start working on


those long-term relationship issues, like what should be the likes of


British businesses trading into Europe. Thank you very much. Alix


has rejoined us in the studio, most CEO, Alix. Let's took on this one in


the Financial Times. Emirates cut back on flights to the United States


after heightened security. This is so interesting, because when it was


announced at the time there was a lot of speculation that this was US


airlines lobbying the president and therefore he would get tough on


those Middle Eastern airlines, that they do not like, because they think


they get unfair state aid. Yes, it has come at an interesting time of


these airlines because they have been expanding capacity and growth


is slower in their home countries because of the slow in the oil price


so quite a good time to get competitive with them. They have


talked about the security measures and the ban on electronics on the


plains. And the Visa regulations changing as well. A lot of


headwinds, to pardon the pun. But at the same time you have big carriers,


the legacy terraces -- carriers in the US, the company they complain


about the Gulf carriers, United airlines getting such bad press.


Indeed, these guys have been winning a lot of market share, they have


been growing very fast, the Gulf airlines, so it is putting a big


tent and that is part of the policies of Trump to try to fight


back on trade with these guys. Talk us through the story from Facebook,


it is fascinating. Your thoughts activating computers to change


things. There is this optical neuroimaging system which is


supposed to be able to read your brainwaves, and mean that you can


actually type with your mind. So scary! Interesting stuff, Alix,


thank you very much.


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