08/06/2017 BBC Business Live

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

Turning up the heat - Qatar's credit rating is cut

Live from London, that's our top story on Thursday the 8th of June.

Who will blink first in this dispute, and how damaging could it

be for Fatah-- Qatar's economy and the region?

Also in the programme: Countdown to Comey.

The former FBI Director will offer testimony

about Trump and Russia, but could it damage

And investors worldwide are watching the UK election, the European

Central Bank meeting and that James Comey testimony in Washington.

We meet the woman with a remarkable career that began on a farm

in rural Illinois and has taken her all the way to the shining

And with polls now open in the UK general election, we promise

So let us know what you make of the stories we're covering today.

When we say politics free, we do refer to the UK election and not the

politicking going on at the moment in the Middle East.

We start in the Gulf state of Qatar, where concerns are growing

about the economic fallout after neighbouring Arab states cut

off diplomatic and trade ties over its alleged support

of terrorist groups, something Doha denies.

Late Wednesday, top credit rating agency Standard and Poors cut

Qatar's credit rating, with a warning it could

Its stock market is down almost 10% in the last three

days, and its currency is at an 11-year low.

Qatar is a tiny nation, but it's a very important

It has one of the world's largest reserves of natural gas.

It has seen exports of its liquefied natural gas or LNG

That's made the state phenomenally wealthy.

It has built up one of the world's biggest sovereign wealth funds,

It's used that money to buy assets across the globe.

They range from Paris Saint-Germain football club to big

stakes in Volkswagen, Russian oil giant Rosneft

and commodities trader Glencore to Britian's Barclays Bank.

Not to mention millions of square metres of London,

including Canary Wharf, the Shard and Harrods.

The success of Qatar Airways has made it a major aviation hub.

But more than 50 flights a day have been grounded

And it's a huge employer of migrant workers, many of whom are working

Families from India to the Philippines depend

There are half a million workers from India alone in Qatar.

Zeynep Kosereisoglu is practice leader, Middle East,

North Africa and Turkey at Frontier Strategy Group.

nice to see you. Let's start with some background to this. How are we

in this position, and why is Qatar looking increasingly isolated? This

is because of long years of tension between Qatar and its neighbouring

countries, like Egypt. We started seeing these problems that in 1985

when we had an attempted coup. We have been watching a lot of these

tensions over the last few weeks increase over the foreign policy,

through mostly soft power but of course the fact that these measures

are taking place today, and to such an extent that it shows us that

maybe a change from a US Per Spett with to the region could also have

been the main trigger for such a large move from these countries. I

remember in 2014 there were some similarities with hot what happened

then, but it strikes me that this time it is more severe. We have had

a lot of talks between these countries about Qatar's foreign

policy, that was more of a short-term spat, but this time we

are seeing unprecedented levels of measures, so different in terms of

the extent and the pressure they will put on the economy. So what

does it mean day-to-day for the economy and people living in Qatar?

A few factors are important. The first one, you have seen already

some shortages within the economy, it is very much import dependent so

we will see domestic prices increasing, but also economic

activity in the country depends on imports as well so we will be seeing

a halt in the construction activity. Qatar Airways as you have mentioned

as well. But most importantly we will see precious on the peg to the

dollar. -- we will see pressure on the peg to the dollar. They do have

reserves to maintain the peg, but as this conflict last longer, we will

set pressure on liquidity within the banks. And as Sally outlined, so

many investments from Qatar around the world, it has been active in

spreading the wealth around the world so it has a diverse economy.

How long does this crisis last? No one really knows. But what are those

ripple effects around the world? It is going to be very hard for the

Qatari authorities to prove to these countries that there will be a

change in policy. They are asking for a very big change, so you have

to make a big move to showcase and prove that the foreign policy is

going to change and that will be quite difficult from Qatar's

perspective. So this might last a little longer than we saw in 2014.

You mentioned some of the investments within the world, but

also a lot of investment in the region, from Turkey to Egypt, so

some of them are in projects that can't be moved out, but the liquid

ones that are mostly in stocks can be pulled, and we could see that if

this lasts much longer. Zeynep, it is good to here your thoughts on

that. For now, thank you very much, Zeynep Kosereisoglu, thank you for

coming in. Let's take a look at some of

the other stories making the news. China's imports and exports were up

strongly last month. Exports in May rose 8.7%

compared to the year before. The latest official trade figures

gave the country a trade surplus Sony says it has sold more

than 1 million virtual reality The PlayStation VR headset

was released in October, and its relatively low price has

seen sales grow faster than rival The headset is designed to work

with the PlayStation 4 rather Three events are keeping traders

transfixed today. One is the UK election, and of course we won't

know the outcome of that until maybe this time tomorrow or earlier. The

other one is the European Central Bank meeting happening at lunchtime

today. No policy change expected, but what will be said at the press

conference afterwards is critical. And then there is that James Comey

testimony taking place today. What does that mean for the Trump

administration? That is playing a part in markets worldwide, we are

seeing a lot of caution in terms of trade. Data out of Japan as well,

about its growth figures. The final figures showing growth at 1%. But

missed estimates by quite a distance, so that the pressure on

stocks in Tokyo. Let's have a look at Europe right now, so a sense of

how things are going. The FTSE 100 pretty flat, sterling still bubbling

along. A slight gain for Germany, and that is the state of play here.

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

All eyes will be on Capitol Hill, James Comey will testify to US

lawmakers. This will be his first public appearance since he was fired

by President Donald Trump. Any damaging revelation in his testimony

could dampen already flagging momentum for Trump's pro-business

fiscal agenda. In earning the series, James maco will be

reporting, and they have warned that four-year sales will be lower than

previously thought. It faces treasure from rising competition and

commodity costs. And a little bit of economics news. The jobless claims

dipped slightly to 240,000 from 248,000 in the week previous. Thank

you. Joining us is James Hughes,

Chief Market Analyst, at GKFX, Let's talk about ECB, because we

haven't talked through at least two days since we talked about the

time this is happening, Greece is time this is happening, Greece is

rearing its ugly head again in terms of the debt crisis, but let's talk

debt first of all. There is no change expected, and this has been

the case for a long time. It is not necessarily the rates we are looking

at now, it is the quantitative easing which is extending to

December this year, but there is so December this year, but there is so

much discussion at the moment about the fact that the German economy is

overheating, the German economy is performing well and this is having

stimulus pumped into it. So much pressure coming from Germany to the

EEC beta start to take that back, but it is getting a balancing act,

Germany much stronger than the other countries. And you have Germany in

that position, you have Greece in a really dire position still.

Yesterday we had banks bailed out by Santander, the whole banking support

system kicking in, and then you have this weekend, Parliamentary

elections in France. It is just a mess, isn't it? It isn't a mess, but

it is complicated! But it is a mess, as it has been for the last ten

years, and we have known this story for such a long time. You call a

spade a spade! We talked about Greece tenures are going exactly the

same situation, and they said, but the IMF said, we will deal with your

debt later. That doesn't work, because later eventually comes

around. Yes, at the time we talked about them kicking the can down the

got to the can, and what will they got to the can, and what will they

do? There will be a few more measures, a few more statements from

Germany about what they will do, and it is a mess, unfortunately, and it

doesn't show any signs of changing. We will talk more about that a

little later, you will talk as though the papers, but for now,

thank you. Let's go to Australia now,

where Special K is a special name. You may think of it as a serial. But

in Australia, it is all about tennis star who is becoming well known. The

top 100 tennis player Thanasi Kokkinakis is trying to use the name

commercially. We have seen this sort of row before, but not often between

a serial provider and a tennis player!

It really is a different type of court case the Thanasi Kokkinakis!

It is over intellectual property. The 21-year-old is known as Special

K, and what he would like to do because he is trying to bank on his

fame and his good health at the time being is to create a special tennis

line of clothing, and all the stuff that can come with it, Kellogg's is

saying that Special K is one of its best selling cereals, and they are

taking him to court in Adelaide. Lawyers on both sides of decided not

to say nothing, but they just showed the crying emoji with the sad words

on his account. Don't cry over spilt milk, that is

what I say. Thank you for your input. Still to

come, we will meet the woman who started out counting cows and now

runs her very own tech firm. It is an accounting software company, it

has gone from strength to strength. We will hear that story very

shortly. You are with Business Live from BBC News. First, let's focus on

some more corporate stories. Flybe, Europe's largest regional

airline has announced a pre-tax loss of ?20 million,

compared to a ?2.7 million The airline recently created

an alliance with Eastern Airways to operate its scheduled route

network under the Flybe brand. Theo Leggett has been

looking at the figures - We have talked about fly be before,

a UK regional airline, it does all of those routes you don't

necessarily want to get a train for but it has not managed to make it a

success this year, big turnaround. We knew this year would be bad

because in March the company put out a profits warning, saying that there

were issues. Some of the problems are beyond its control. For example,

bad weather which has forced flight cancellations, strikes among air

traffic controllers in France, that has had an impact. You say they do

routes that people won't necessarily take trains for but some of the

routes they do, there are rail alternatives and the rail companies

have been discounting so that has had an effect as well. But to a

certain extent, Flybe has also been a victim of its own actions. When

things looked better if you years ago it ordered a lot of planes. It

has renegotiated some of those contracts, but other planes had to

be brought into the fleet and it had to find something to do with it.

That has left it with a problem of overcapacity. It has not been able

to fill up the planes quite as well, not been making so much money and

there is a lot of competition in this market. That is where some

other problems have been. It has been insulated from other issues

because it mainly flies of the UK, it hasn't had many problems as other

airlines with a fall in the value of sterling. They does have the pay

aircraft leasing products in dollars but it has hedged against those in

done rather well from those hedges. It is struggling at the moment in a

broad brush. It thinks it will be able to reduce the size of its fleet

when leases come up for renewal later in the year so that should

help sort itself out. So it is saying things should get better in

the future, on the other hand there are big cost involved as well

because it is revamping its IT systems and expect over the next

year to have ?6 million worth of costs associated with cancelling

existing contracts. So a mixed picture but the past year has not

been particularly good. Thank you very much. A reminder of course, in

case you had missed it, it is the general election today. A reminder,

BBC coverage begins on BBC One at five to ten this evening, the first

results around midnight. Qatar has had its rating cut.

Reuters reporting that Qatar's central bank has asked commercial

banks to provide it with details and frequent updates on their foreign

exchange trading. Lots of people scrabbling to get hold of US

dollars. We are also hearing anecdotal evidence of just quite how

this rift is affecting people. We have heard women the last half-hour

that the Emirates Postal service is stopping all Post a Qatar, and says

if the posters midway there it will come back. -- all post-to Qatar.

Let's remind you how market are doing in Europe, trading has been

underway for nearly 15 minutes. Pretty flat really. Rent crude up

nearly 8%, but at $48.43 a barrel. The FTSE 100 fairly flat. Keep an

eye on the pound, tomorrow, in the wake of the vote of the UK general

election. And now let's get the inside track

on coding - an industry that's often Therese Tucker runs a financial

software firm - black line - and is one of only a handful

of female tech entrepeneurs Originally from a farming town

in Illinois, she took one of the first ever programming

courses offered by Apple In 2001, she founded BlackLine,

funding the business herself. She's had to battle sexism

in the tech industry - some funding for the business

was only offered on the condition that she was replaced

as Chief Executive by a man - but she's seen off these

challenges and joins us now. Still the boss. Quite an achievement

just to be here given all of that, welcome to the programme, good to

have you here. Let's start with the business. We said during the

programme, your background was very rule, talk us through this course.

You went to university and you took the Apple course. That is when you

fell in love with coding and that is pretty where you are. Focus through

that. The beautiful thing about programming is that you can direct a

computer to do something for you, and you can then run that on a

million computers. The power is amazing for what you can do for

business with that, and I fell in love with it. And I have spent my

entire career doing that. Take me back to the 1980s, and that Apple

course. We all see at full a certain way now and we see what it has done

an transform the business, what was apple-like back then? It was

radically new. At that time, most of the computers were still mainframes

with cards, and is terrible to work with. Apple was this amazing new

innovation that actually made it fun. Not that different from today,

in many ways. Tell us about the journey, it sounds like it has been

pretty tough. Any journey is tough. But if Nutley in the tech industry.

It is very male dominated, and that is true, starting in university. I

would be in classes weather might be -- where there might be one other

woman in the class of 500. It has not held you back, have you heard

had to overcome certain things or have you just ploughed ahead

regardless? How have you tackled it? I believe it has both a good and bad

side. If you were the only woman in the room, you absolutely get

noticed. You do have to have a bit of a thick skin however, so that

certain things just don't bother you, you just move on from them. You

have also got to be pretty persistent. I'm just looking at some

of your journey. You drained your bank account, emptied your pension,

second mortgage to your home, and you maxed out your credit cards and

baked your friends. That is quite a gamble! It is a little scary at

times, I had many sleepless nights. The funny thing about being an entry

to nor is when you are doing people think you are crazy, and when you

are successful they think you're brilliant. And they love you. But

you are exactly the same person throughout the entire journey.

Putting all of that money on the line, your livelihood on the line

from your friends, family, it could have gone the other way. I could

have been completely poor, starting over in my 40s, it was terrifying.

And put this into perspective as well, you were facing a woman with

two children at that time as well. Yes, it was terrifying. So you must

have just absolutely believed in this company you created, which is

still black line. Yes, it is still black line. Being an entrepreneur,

you have this overwhelming desire and drive to build something. I knew

that if I gave up that six months later I would be thinking about the

next company. When you were looking for venture capital funding and the

U approach said yes, we are interested but we want this man to

run the company, not you, what was your reaction? I wanted to evaluate

it, I was the new CEO, I wanted to do what was best for the company, so

I did have a meeting with him, and was not terribly impressed. So you

didn't go ahead? We didn't go ahead, and we did not go ahead with that

venture capital. I have since found many people that are quite

supportive, regardless of my gender, and that was the right move at that

point in time. Time is really tight but I'm interested in your view, I

have a bit of a perspective on this. Are things changing, are more women

able to succeed in the tech industry? No. Enrolments in

university in technology courses is at an incredible low, it is hard to

find women programmers and subsequently there are less people

promoted, less women technology entrepreneurs. Why is that? I don't

think they teach it correctly, they need to teach it with much more of a

will real-world perspective so that it reaches out to women who like to

solve problems. Sounds like another venture for you. It could be.

Therese, thank you very much. President Trump's plans to ease

regulation on US banks will have dire consequences -

that's according to the former Congressman who orchestrated major

reforms after the financial crisis. Barney Frank helped

introduce the Dodd-Frank Act But the US House of

Representatives will vote later Mr Frank has been speaking

to the BBC's Mariko Oi. What they are talking about undoing

are the rules that keep large inch oceans from getting so indebted that

the government is faced with a choice between paying taxpayer's

money to bailout their debts or letting them go under and causing a

crisis. But do you agree with some of the proposals made by the choice

act? You yourself said there were some mistakes in the Dodd-Frank law

you would like to change. I do believe that the $50 billion level

we set to be in the super jurisdiction was too low. That was a

mistake we made of the time. There is a bipartisan coalition ready to

raise that. I think the smaller banks and the 10 billion should get

some explicit relief. There were rules we didn't think would apply to

them. In fact they are concerned about them, they spent about of

money showing they are affected by them, so I think there would be a

consensus to do those two things. Beyond that, everything that the

Republicans pill verse, the rules we put in place to prevent

irresponsible behaviour. I would argue for any of those. Barney Frank

of the Dodd-Frank act. Ken Dodd, a of the Dodd-Frank act. Ken Dodd, a

comedian in the UK, let's not go there.

Joining us again is James Hughes, Chief Market Analyst, at GKFX.

This is an interesting story from our transport correspondent on the

BBC website today, does BA's explanation stack up? This is to do

with their delays. Their explanation has some people worried a little

bit. The explanation being it was human error? Yes, someone

messed up the reboot and fried the messed up the reboot and fried the

circuits, and that is the language that was used, it was like me saying

to my dad what happened, that is the kind of excuse I would have for

smashing the TV or something like that, not bringing down a

multibillion-dollar company. James, thank you, thank you for your

company, sorry it was so brief. Goodbye.