30/06/2017 BBC Business Live


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Live from London, that's our top story on Friday June 30th.


Scores of flights will be cancelled over the 16-day walkout,


with many asking if the cost-cutting is worth it.


as the week draws to a close, we assess the fallout of the major


cyber attack that hit businesses around the world.


And the markets? Yesterday, Europe had its worst day for about nine


months and today, not looking quite so bad but the FTSE is still down.


We will be looking at the figures. And we'll wrap up the tech stories


with our guru Rory Cellan-Jones - Also, as packets of Weetabix are


fine for Google. Also, as packets of Weetabix are


inhabited New Zealand, we want to know what you can't live without


when you go on holiday. Is it your pot of Marmite


or your tea bag? Let us know.


Just use the hashtag BBCBizLive. We start with more problems


for British Airways. Thousands of passengers


are learning that their flights have been cancelled


because of an unprecedented 16-day strike by some cabin crew,


which begins tomorrow, July 1st. On Thursday, BA said most flights


will operate as normal, but it has cancelled a number


of long-haul departures Short-haul and flights from other UK


airports are unaffected. The Unite union says cabin crew


who have taken industrial action over pay in the past


have been "blacklisted" losing benefits like staff travel


concessions and bonuses. BA estimates around 8% of its total


cabin crew will walk out. To limit the damage,


the airline is merging some It is also talking to other carriers


such as Qatar Airways, which owns one-fifth of its parent


IAG, about using their services. Well, upsetting its customers again


is the last thing BA needs after a major IT crash last month


stranded 75,000 passengers. The financial cost


was some $100 million - but the cost to BA's reputation -


possibly much greater. Alan Bowen from AGB


Associates is with me. He is an airline analyst. This has


really become a very entrenched stand-off, hasn't it? And it is more


than just pay which is at stake. Yes, it started with pay. It relates


to cabin crew who began work after 2010 and they are on a very


different and much lower pay scale than staff who were there before.


But that has been resolved but BA took the view that because they went


on strike, they would lose all the additional benefits they are


entitled to. What will happen now? This is coming right in the middle


of the holiday season, really, at the start of it, anyway. How much


disruption is there going to be? Interestingly, BA seems to have


leased aircraft from Qatar airlines. Interesting choice. Indeed, we are


aware they are bringing in nine aircraft to operate flights which


they might not be able to operate themselves. The number of staff


going on strike maximum appears to be about 1400 and they have a total


of 15,000. Their intention is to operate as many flights as possible.


They have promised but we will have to wait and see whether it happens,


that they will get everyone everywhere they want to beat but


they've cancelled about six long-haul flights in the next seven


days. On short-haul, their aim is to ensure they operate at least one


flight per day on all routes so you may have to fly at a different time


but their intention is to get everyone to their destination.


Interesting choice of Qatar airlines given that they have been isolated


in recent political events. Indeed, Qatar has its own problems at home


and it is also a shareholder in IAG, the holding company of BA and for


the Middle East, this is low season because temperatures are very high


and people are not travelling. It is a win-win from that perspective.


Let's talk about BA's reputation because it was traditionally seen as


the flagship carrier, a step up those budget offerings but it feels


like all the recent headlines have been about cost-cutting and its


consequences. How the airline being viewed? Orange Mackreth a lot of


people are beginning to wonder whether it has still been the


world's favourite airline, it cut food and drink from short-haul


flights so you have to buy a sandwich on board if you want it. It


has upset most of the travel agents in Europe with an announcement they


are going to charge additional fees for travel agents to book them from


the 1st of November. And obviously, we had the disaster on the bank


holiday weekend. It is not looking great. Thank you for joining us.


Let's take a look at some of the other stories making the news.


Deutsche Bank has again rejected demands by US


House Democrats to provide details of President Donald Trump's


Deutsche Bank has loaned the Trump organisation millions of dollars


The European Union is appealing a recent World Trade Organisation


ruling in favour of the US over its state aid for Boeing.


Earlier this month, a WTO dispute panel found the US had dealt


with all but one of the instances of illegal subsidies


Two Montessori schools in New York won't let parents


pay by credit card - but they will now accept Bitcoin.


The schools added the option after a growing number


The decision comes as more and more places -


including universities in London and Greece -


no longer accept the digital currency as payment.


Have you ever paid for anything with bit groin? I certainly haven't. Me


neither, I would not know where to start. Let's take a look at some of


the stories on the business Live page and let's talk about rasp


reply, the computer. I thought you were bringing in pudding! It is a


microcomputer and the company behind it said they had no idea it would be


so big. It has sold 14 million of these tiny microcomputers, mainly


aimed at schools but they have now gone into a number of businesses and


industry as well and rasp reply has just won a top innovation prize from


the Royal Academy of engineering. -- Roseberry pie. Rory is going to


bring us in one. But not edible, sadly.


A Chinese bank and a shipping firm have been hit with sanctions


by the US over allegations of support for North Korea.


Let's get more with Tim McDonald who's in Singapore.


Tim, this is a real ratcheting up, perhaps in relations with China by


the US? Well, it is interesting you say that. In fact, the US has kind


that it not really so much about sending a message to China as just


focusing on the entities involved. In this case, as you've mentioned,


two Chinese citizens, a shipping company and the back, which the US


says are connected to North Korea's weapons programme, the bank of


Dandong which the Treasury Department has zeroed in on is for


all intents and purposes just a local Chinese bank, not well-known


beyond the city of Dandong itself but it's on the border with North


Korea and one of the few places where there is significant traffic


into and out of the country and the US says about 17% of its


transactions are with entities that have US or UN sanctions on them for


connections to North Korea's weapons programme. The US once again says


this is about sending a message to China, as well as the entities


involved. They continue to work with John on this. -- this is not about


sending a message to China, just the entities involved. They are


continuing to look at the entities which may be helping North Korea.


Thank you for joining us. The markets in Asia followed


the mood of Europe and Wall Street yesterday,


trading down - why? Those signals from the world central


banks that the almost decade-long era of low interest rates,


cheap money, is slowly and, given that the markets


are susceptible to sentiment, you might expect the optimism


to have a positive impact, but some investors are concerned


that the world economy might not be able to take the


interest rate rises. Europe yesterday had its worst day


for about nine months, and the Dax. A few months ago but it is down and


the FTSE is down. Let's go to Wall Street and see what is happening


there. US markets should be quiet on Friday


ahead of what is likely to be a long weekend giving the 4th of July


public holiday on Tuesday. Still, there is some economic data for


investors to consider. The University of Michigan consumer


sentiment index is released and the last reading this index showed


consumer sentiment at its lowest level since the presidential


election in November. Economists are not expecting it to have risen


significantly. There are no big company earnings out but that does


not mean you should not keep an eye out on energy stocks. On Thursday


afternoon, President Trump gave a speech boasting of the strength of


America's energy industry and claiming new initiatives would be


coming to boost power, natural gas and oil production. Maybe that will


bring some cheer to investors in those industries.


Michelle Fleury in New York. Joining us is Jeremy Cook,


Chief Economist, World First. Rachel was talking earlier about the


impact on the financial markets, particularly European indices and


Asian indices and the US, the fact it looks like it is the end of the


era of easy money but what is happening to the currency? It is and


some currencies, the euro and sterling, normally during the summer


doldrums, everything trades sideways but this is the time where central


bankers around the world have decided to inject a bit of


volatility into the markets. Sterling and the euro have both


gained in the past week as the bank of England and the ECB respectively


have said we should be getting prepared, or certainly policymakers


at the central banks are saying getting prepared for rate rises.


They are happy with where rates are at the moment but they want to say


rate rises are coming soon. Explain why that is. If the dollar is more


in demand? The best way to think about currencies is like savings


accounts. Where are you going to put your money? If I gave you both


?10,000 now, I'm a generous guy, and said you could put it in a savings


account, savings account that pays you 2%, or 4%, you will put it in


the one that pays 4% but if they both pay 2% and you think the second


one will hike in interest rates, more money will flow into that so


investors are looking at it that way. Excellent interest -- excellent


explanation. And data coming out of China as regards to factory output,


what is that showing? Manufacturing PMI rising a bit so this is


sentiment in the manufacturing industry in China, the largest in


the world, the second largest economy in a while and if they are


doing well, that should flow through the rest of Asia and Manufacturing


is normally the first thing to roll higher in a new input or spurt of


economic growth. If China is doing well, hopefully the rest of Asia is


doing well and a lot of the economic centre of gravity has shifted there,


given the pick-up of Southeast Asia in the past ten or 20 years. Thank


you for joining us. And I know you will come back to talk through some


of the other stories in the papers. Some interesting ones. What can't


you go abroad without? Have a thing. Still to come - record


fines and cyber attacks - it's been a big week


in the tech world. We'll make sense of it


all with the man in the know, our technology correspondent,


in a few minutes. You're with Business


Live from BBC News. A survey of UK consumer confidence


suggests it has fallen to the lowest level since last June's referendum


on European Union membership. Researchers at GfK,


which conducted the research, found that the biggest drop


was in people's willingness And later today, we find out


the final figure for economic growth in the first quarter of this year,


which was revised down to 0.2%. Well, let's get more with our


business correspondent Theo Leggett. Let's start with the growth figures.


Remind us what figure we were given initially at where we stand at the


moment. The figure we were given initially for the first quarter was


0.3% compared to the previous quarter. That has since been revised


down as more information comes in, to 0.2% and we are expecting it to


be finalised at about that level and that is a significant slowdown from


the tail end of last year when the figure was 0.7%. Any indication that


consumer confidence is declining is worrying because it suggests that


could weigh on growth in the future. That is true, the consumer


confidence... But are there other indications of why that is? Several


factors could be at play. One of them is clearly uncertainty caused


by the general election. If you compare this survey with another one


that came out earlier in the week from YouGov, that suggested that


consumer confidence was reasonably stable up until the election and


then declined quite dramatically afterwards but you have to factor in


other matters as well. The decline in the value of sterling since the


referendum last year, that is starting to feed through to


inflation. One thing we are seeing in this survey is that people are


becoming more reluctant to spend on big-ticket items like washing


machines and pieces of furniture. The simple reason is, those things


are becoming expensive. If they are imported, they will certainly be


more expensive. There's pressure on wages as well, wage growth is not


what it once was. The combination of things getting more expensive and


people not feeling they are going to get any wealthier, that may be


suppressing consumer as well. -- consumer confidence. Thank you for


joining us. Another story we want to tell you


about on the business page, Trinity Mirror has allocated more money to


phone hacking claims, setting aside an extra ?7.5 million to cover


claims related to the hacking of phones which adds to the ?26 million


it had already earmarked to pay for that. It has settled cases with


dozens of celebrities, the newspaper group.


Our top story - British Airways prepares for a major walk-out


by cabin crew that will ground some of the carriers' scheduled flights.


It comes only weeks after an IT glitch caused chaos for the airline.


A quick look at how markets are faring.


It is red across the board at the moment. The FTSE 100 down and there


are concerns about the era of easy money coming to an end that has


affected the stock markets and the currencies.


And now let's get the inside track on tech.


This week, Google was slapped with the EU's


largest ever fine for distorting the market.


The European Commission fined the tech giant


$2.7 billion after it ruled the company had abused its power


by promoting its own shopping comparison service


And a large-scale cyber attack involving malicious software


disrupted firms' computer systems, hitting Ukraine especially hard,


but spreading to countries as far apart as Norway and India,


Let's find out more with our technology correspondent


Let's start with this cyber-attack, it seems as though it was mainly


targeted on Ukraine, but spread out. When glitches, the patches weren't


put in places that's right? When it first happened, we thought is it a


repeat of that attack we saw around the world. It does appear to be


similar, but different in crucial ways. Yes, it appears to have been


targeted at Ukraine and there is suspicion being thrown at Russia,


but the technique is different. It looks like the other one. But it is


actually wiping data. It is not actually they think about gaining


money, it is a malicious attack which indicates it could be


state-sponsored. But it hit a Russian airline. Once the attacks


are out there, their effects can be unpredictable. Now that Google fine,


higher than many people expected. Yes it was a real marker for how


determined the European competition is and it has opened up a split


between Europe and the United States. Europe says we are complying


competition law. Voices from America saying, you're biased against our


successful company. All the company has done is be the best in its field


and used its skills to conquer a market. Europe believing that Google


is abusing that dominance in one area to spread into other


businesses. Remind us what they did? It is about shopping services, put a


name of a product into Google, put in leather shoes and a box comes up


with adverts and when you click on one advert, Google earns money.


Other price comparison sites are available, but you will struggle to


find them in a Google search. I spoke to companies who say their


businesses have been affected and other search companies, by the


practices. It is difficult to get back into the market. Could it lead


to more innovation in Europe. The argument from America is the


opposite, it is punishing innovation and the European commission doesn't


understand how business works. Google says people have a choice and


they say their big rival is Amazon and you go there. Perhaps there


could be more competition do you think in certain areas of the world


where the dominance of Google has been reigned back. The bigger


picture, experts say this is possibly the wrong target and there


is the dominance of three or four American technology giants and


concern around the world the regulators need to do something to


hold that back, to attack that, otherwise we won't see the


innovation we expect. Thank you. We are going to be talking about


Raspberry Pis. It is not a dessert. It is a tiny computer launched in


2012 in an attempt to change the way children understood computers and to


get them programming. It has had a bigger effect than expected, the


reason we are talking about it is last night it was awarded the


biggest annual prize for engineering, the prize that has been


won by Rolls-Royce and lots of huge projects, it has won it, because it


has gone beyond being an educational tool and it is ending up in


factories, the 40 million that are sold are ending up in factories. It


started off to encourage children to get into coding. Yes it had modest


ambitions and they expected to sell tens of thousand, it is a charitable


aim, the bigger project is encouraging kids around the world to


get into coding. So just a great example of how something can snow


ball, a bit of engeneral youty, came from -- ingenuity. Have you coded


with it? Yes I'm very inexpert, but I did manage to make a radio with


this. I was very proud of myself. So you're never too old to learn. That


is what I'm told. Thank you. In a moment we'll take a look


through the Business 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 the business news and all the latest details with


insight and analysis from the BBC's editors around the world. We want to


hear from you too. Get involved on the BBC Business Live web page.


Jeremy is back to look through the papers.


We will start with that cyber security story, this is is an


innovation that happened to bark cards in -- bank cards in France,


where the three little numbers on the back, there is a computer screen


on the card. That is incredible and the numbers will change on an hourly


basis, if somebody finds your card there is a number that is always


static. So this is to try and cut down the online fraud, which has


boomed, as we have decided to shop more and more online, I think, it is


something like 28% of all US commerce is online at the moment. So


imagine the size of the Amazons and that when it gets to 50%. But the


fraudsters are taking advantage. Interesting this has come from


France, actually chip and pin was first developed in France you go to


France and think what is this? And it took us a few years. You go


around the world and chip and pin which we treat here in the UK and in


Europe as de facto and contactless, in the United States for example,


you still have to sign for things. There is a long way for the security


protocols to become the same. But this is fighting the fraudsters. Now


Weetabix has been seized in New Zealand. In a breakfast bowl battle.


Post-Brexit relations with New Zealand are already fraught. We


asked our viewers to tell us what they can't go without. This has been


shipped to New Zealand to be sold in a ship in Christchurch. Alan said,


HP Sauce, crumpets. One said my lap top. One said, are they impounding


Weetabix to try and stop The British Lions. Yes we will need all the help


we can get on Saturday. This is about Weetabix and Weet-bix that is


the New Zealand version. There are hundreds of packets. 300 boxes not


being served into this small business, A Little Bit of Britain,


that sells things to ex-pats there. This is a portion of just, I'm


looking at it through t kaleidoscope of Brexit. We will have to sign


deals to stop this. There will be trade marks that exist any way. Yes,


but in the grand scheme of things, these businesses don't just exist in


New Zealand, there is a very big one in New York which I pop by and you


see people buying 12 pound boxes of Yorkshire tea. One says, when I go


abroad, I must are a a packet of digestive biscuits. . I have to have


cheese and onion crisps. Don't eat them on the plane. Thank you for


coming in. There will be more business news


throughout the day on the BBC Live web page and on World Business


Report. It has been very wet for some of us


and in Edinburgh you have had more rain in


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