05/05/2017 BBC Business Live

This is Business Live from BBC News with Rachel Horne

The chief executive of the world's second

largest investment bank - Goldman Sachs - has warned

that London will stall because of the risks

Live from London, that's our top story on Friday 5th May.

Yep, the big boss of one of the world's largest banks,

Goldman Sachs, tells the BBC about his preparations

for a world after Brexit - that's coming up in an exclusive

A new rival to Airbus and Boeing takes to the skies.

China's first home-grown C919 passenger jet has taken

off on its maiden test flight in Shanghai.

Europe is open, it's all about oil, elections and US jobs figures.

It's been an election campaign that's turned French

politics upside down - now is the last chance for the two

Presidential candidates to appeal for voters before the polls

We'll get the inside track on the last week of the contest

and ask how much the winner can achieve when they get into office.

No specific question today. Just letters know what you think of the

programme. Be nice! The head of the American

investment bank Goldman Sachs, has warned that Britain's financial

centre - the City of London - will stall when the country

leaves the European Union. Lloyd Blankfein told the BBC

that the bank had contingency plans to move staff to mainland Europe,

depending on the outcome At the moment Goldman Sachs employ

6,500 people here in the UK. The bank is due to move

into a new premises in 2019 as it tries to bring all its London staff

into the same building The stakes It has around 34,000 staff

worldwide. As one of the world's most

successful investment banks it made a $7.4 billion profit last year

with the UK operation Our economics editor

Kamal Ahmed is with me. Good to see you. Let's start. There

he is. I will go of script, this is his first interview in the UK for

years? A number of years. Lloyd Blankfein used the words London

could stall. Will stall. Will stall, sorry. How strong is that from the

people you know and we'll talk to? It is a strong warning, it is his

most substantial take on the risks of Brexit, and not just to the

United Kingdom as Britain leads the EU, but also to the European Union.

He does not really want to talk about his own profits and his own

bank, he knows nobody really cares about Goldman Sachs and the billions

of dollars they make every year, but he talks about the businesses that

use the banks to raise money to invest, and governments that use the

banks to raise money for the debts they are carrying. He says if there

is a poor deal, it means the system of funding becomes less efficient

and less secure. I asked him if the UK was less attractive for banks

like Goldmans and others outside the European Union and the single

market. A lot of people elect to have their

European business concentrated in a single place.

for the biggest economy in the world to concentrate would be the UK -

the culture, the language, the special relationship,

If you cannot benefit from access to the EU from the UK,

and nobody knows what those rules and determinations will be,

then the risk is there will be some adjustment that will cause some

people to have a smaller footprint in the UK.

He talks about possibly having to move some people, they play 6500 in

the UK, did he give any indication as to how many that means? They are

being incredibly careful. Britain does not officially leave the EU

until 2019, Lloyd Blankfein said if there was not an implementation

period of at least two years they might have to move more people than

presently. No numbers on that yet but he said he had had discussions,

or the bank had, in Frankfurt, Dublin and other centres where they

could move to. I pushed him on how far they were on planning to move

jobs away from the UK. Without knowing how things will turn

out, we have to plan for a number of contingencies, and our hope is that

we don't have to implement anything until we know what we have to

implement. But if there is no period of time to implement whatever

changes are brought about in negotiations, we might have to do

things prematurely and a range of things a precaution.

Did he mention any other place around Europe that could fill the

shoes of London? If you look at places like Frankfurt and Dublin,

where they have operations already, they have operations across Europe,

in Lloyd Blankfein's words we do not have the legal and regulatory heft

that London has. London is a global financial centre and I think,

frankly, the big winner if London loses some of our financial services

trading into Europe, will actually be New York. Lots of people might

move to New York rather than on to continental Europe, because they do

not have the breadth. The big message was we want to stay

committed to London and Europe, it is better for both sides if the

trade deal between Britain and the EU is as close to what the single

market provides that the moment. Cool. Kamal Ahmed, thank you. Much

appreciated. A great weekend. Let's take a look at some of

the other stories making the news. The oil price has fallen

to a five-month low as investor concerns re-surface

about a worldwide glut. During Friday trading in Asia,

Brent crude dropped to just It means the gains made since last

year's supply cut by the influential Opec group of oil producers have

been largely wiped out. The owners of British Airways

and Iberia - IAG - has reported better than expected

operating profit for the first three months of this year

of almost $187 million. That was before one-off items

and amounted to what the chief executive Willie Walsh said

was a record performance US airline Delta has apologised and

offered compensation to a family who say they were kicked off a flight

for refusing to give up a child's seat. Individual of an incident, a

crew member is film is warning the parents that if they do not get off

they will be committing a federal offence, they will go to jail and

their children will be taken into foster care. It comes after the

incident last month were a passenger was injured after being taken off a

flight. This is my favourite it is all our

lines! I would love a weekly show about our lines!

Shares in the Australian airline Qantas have hit a nine year high

after it said it expected profits for the current financial year to be

In the year to the end of June expects to make $1 billion as demand

It is the flying kangaroo. Guess what, we have more aye lines. I will

start and then I will do is the question. -- lets you ask the

questions. China's first home made big

commercial jet has just landed safely after making

its maiden flight. The plane has been almost ten

years in the making. It is designed to challenge

Airbus and Boeing in Robin, good to see you. We will talk

about what this could mean for Boeing and Airbus, but nearly ten

years in the making, this is a big deal in China? Yes, this is a moment

of national pride. It is a moment for China to prove its technical

proficiency to people here and the outside world. It is politically

important because China's leader, President Xi Jingping, has called

for a growing domestic aviation industry that he says can reflect

the new capabilities of the world's the new capabilities of the world's

number two economy. China is focusing on strategic industries in

its effort to show technical proficiency and expand production

abroad. Part of that is the nuclear and is to, part of that is

high-speed rail, aviation is one of those. This particular jet was first

announced in 2008, we got the Maytin take-off and a safe landing in

Shanghai today, about nine minutes ago. There will be sighs of relief.

The key thing is to develop it and sell it not just in China where, to

be honest, domestic airlines are very much on board, there are 570

orders and options, but how will they do abroad? Make no mistake,

selling domestically is important because the Chinese domestic

aviation markets has the potential to be huge. You have pretty much

answered me, whether abroad or not it is one of the fastest-growing

aviation markets in the world. The country builds an airport what seems

like every year or two. In China alone, Abbas and Boeing looked

towards China for their future order books. This plane and its success

could dent those companies? Boeing has an assembly plant due to open in

Beijing in the North next year, I think. They are trying to move on to

the domestic market. Every time we fly in this country it is an Airbus

Ora Boeing, similar to everyone around the world. This is an effort

to show that China has a burgeoning industry and can take on

particularly those were courses, the 737 and the A320 made by Abbas. --

take on those workhorses. There are about 15 foreign suppliers on board,

the engines and systems are made by foreign suppliers. Getting

international safety approval, there have been issues with aeroplanes

made by this maker and that will be huge test of international

acceptance, which is a crucial part of art for China. Thank you.

Stock markets on the way down today - a plunge in oil prices pulling

down energy companies right around the worls and we'll be talking more

about that with our markets guest Maike Currie in a moment.

Also investors looking ahead to US jobs figures due out later today.

It is children stay. ... Children's day. In Europe, markets are down.

Investors have seen a good run of company results -

almost half of European companies have reported their earnings so far

with 74 percent beating analyst expectations and 6% meeting them.

Samira Hussain has the details about what's ahead on Wall Street.

If it's the first Friday of a new month it can only mean one thing for

business and economic news from America, non-farm payrolls. The

employment rate is expected to have risen slightly to 4.6%, with

analysts expecting the US economy will have added around 185,000 jobs.

Investors will be laser focused on the jobs report and looking for

clues on the US Federal Reserve's interest-rate hike trajectory

through the end of the year. In earnings news, the conglomerate run

by billionaire Warren Buffett will be reporting. The results of

Berkshire Hathaway reduce the date -- announced the day before its

annual shareholder meeting. As of market close on Thursday, one share

in the Oracle of Omaha's company will cost you about $249,540.

There you go. Joining us is Maike Currie,

investment director for personal A familiar face, good to have the

withers. The black stuff, oil, around $47 a barrel. -- good to have

you with us. Google will fundamentally is a case of supply

and demand. As soon as Opec brings in production cuts, the US shale

producers romper production and there are always the other

prejudices, Russia. They are producing at record levels.

OnDemand, a year ago we saw the oil price languishing in the first

quarter of 2016 at around $30 a barrel, there was global growth

slowing, concerns around China, lots of that has disappeared so it is

constantly the balance between demand and supply. We had results

from BP and Royal Dutch Shell, good results, but now the oil price is

starting to slip, what impact could ban have? It is cast a shadow over

those really good results. Shell reported a 136% rise in profits,

share prices up over 30%, but they cautioned times would be tough and

cost-cutting is key. We want the oil price to stay between $50 and $55,

$60 a barrel, that is the golden locks scenario where oil is that

A-level but it is low enough that global growth can continue but high

enough that the oil producers can make money. What about Opec, people

seem to be losing faith in them? There is a meeting on the 25th of

the month, there is an idea that they will cut and people go, are

you? Have they almost lost power? Opec has been disciplined in pushing

through those cuts, but the market is losing faith. They have been

resilient to the fall in the oil price and nimble and of course

Russia... Indeed. You are going to come back and we are going to go

through the papers. Still to come, we'll

get the inside track on the French Presidential

election before voting gets You're with Business

Live from BBC News. International Airlines Group,

which includes British Airways and Iberia, has posted a record

first-quarter performance in what is usually the weakest part

of the year seeing a profit of just Our business Correspondent Theo

Leggett joins us now. Not only is he a redhead, but is

also a bit of an aviation that, like me. You have to take your hat off in

some ways in terms of making money. They have done a job in a

three-month period, so what's behind it? Lower oil? Fuel prices is

certainly part of it. It went down about 10%. There's also a resurgence

in confidence. The industry has been under the cosh lately with the

political uncertainties in the case of International Airlines Group,

including Rex it's because BA is a large part of its business but

there's also been terrorism fears and that sort of things which have

been weighing down on passenger numbers. These numbers this morning

are pretty good. Operating profit, 170 million euros, up from 155

million from the same period last year. These are positive figures.

There are some downsides. The effect of the weak pound, the get their

profit in euros, a lot from British Airways. The currency difference, it

has cost the group as a whole about 32 million euros. Passenger

revenues, also decreased, down by 4.2% although the company said it's

partly due to the timing of Easter holidays which was in March last

year. This year it was in April. The net profit figure was down by

non-operating costs, basically re-evaluating derivative contracts

which means a profit after tax was down by 75% but that's an accounting

gesture. The markets like what they see and their profits are up more

than 4% this morning. Good on you. You can talk, can't you? I had other

questions but you have covered it all. Good on you. We have our

business life page. When the airline is going to learn about PR and

customer service? Picking on a two-year-old! OK.

The chief executive of the world's second largest investment bank

Goldman Sachs has warned that London will stall because of the risks

A quick look at how markets are faring.

We can see they are all down and the big story is oil, it's pulling down

energy stocks and impacting across the world.

The two candidates battling for the French presidency

are spending their last day on the campaign trail

The frontrunner, Emmanuel Macron, is in the southern city of Rodez.

His rival, Marine Le Pen, is campaigning in northern France.

And the state of the economy has been a key concern

Emmanuel Macron wants spending cuts of 60 billion euros.

That's $66 billion over five years with a 50 billion euro stimulus

He also wants to lower taxes and extend the welfare state.

Marine Le Pen has been very critical of austerity.

She has pledged to cut taxes for households and increase welfare

She also argues quitting the Euro would give France the flexbility

The French unemployment rate is stubbornly high at 10%.

Emmanuel Macron wants to invest in training and apprenticeships,

He also wants flexibility on overtime and the

On the other hand Marine Le Pen wants to maintain the 35-hour week,

make overtime tax-free and lower the retirement age from 62 to 60.

They want to lower it. Everybody else's raising it.

Dr Ittie Lotem from the University of Westminster here in London

is an expert on France and joins us now.

Great to have you with us. Can I pick up on one thing straightaway?

Both want to increase the welfare state. France has a deficit problem,

meaning they spend more than it earns in taxes. They want to

increase it? France can't afford it, can it? But as a whole different

question but one of the things, the big problems in France is how to

actually make the economy work, how to this is a take the economic model

whilst retaining some kind of welfare level comfort. One of the

things of course people in France are very proud of is the French

model which has come through after the 2008 crisis, when actually

poverty levels have remained extremely low compared to what's

happening in the UK and the USA, so this is something France is aware of

in terms of maintaining the welfare state. Maintain it, but it doesn't

mean it works. They can't afford it. Their poverty levels are there

because the government is throwing because the government is throwing

more money than they actually earn at its. That's not sustainable. Is

it? The question of sustainability in France always comes down to

unemployment. Just trying to get unemployment down, trying to get

enough people into the labour market, into a working cycle in

order to maintain the welfare state. Of course, one of the biggest

problems in France is unemployment, which has remained stubbornly high

at around 10% for the last 40 years. It is the big building stumbling

whatever they say, the big problem whatever they say, the big problem

is how to get unemployment down. Being realistic, these are two very

different candidate but whoever gets elected they got to try to get these

changes through the legislative into law. What are the chances of that

happening? We have elections coming up in June. Well, your guess is as

good as mine. One of the issues here is of course the French election

system. One will be elected as president, probably Emmanuel Macron

looking at the polls right now, but that doesn't mean they'll have a

working majority. They will have to come through from the legislative

elections in June where any kind of majority is still up in the air. OK,

so we will know the president on Sunday, who is the President of

France but we wait until June to see if they can do anything. If they can

make any reforms, OK. An absolute pleasure to have you with us. Have a

great weekend. In a moment we'll take a look

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have a story from a Financial Times about Obamacare. Is more than 100

days since his election and it looks like he's finally starting to

achieve his objective is but this is not even definite, is it? No, it

needs to go through the Senate. It's important because the first 100 days

have been a disappointment. He went into office with ten key promises

and has not delivered on any of those. There has been a torrent of

executive orders and minor tweaks but most are been focused on

reversing some of Barack Obama's things he brought in. The key thing

is why does Trump want to push through health care reform? He wants

to get his tax reform through and out of those three things he has

promised, tax reform, infrastructure and deregulation, that's the one the

market is focused on and a lot of the optimism is around that. We've

got 30 seconds, so explain the dead mark oysters of China. Denmark has a

glut of oysters on its coastline and it has gone to the Danish embassy in

Beijing and said, could we sell these oysters to you online? And

they got ten days from when they are picked? They can live up to two

weeks but they are trying to expedite the customs process. The

last thing you want is a dodgy oyster, right? And a great weekend.

I appreciate your time. There will be more business news

throughout the day on the BBC Live webpage and on World Business

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