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This is Business Live from BBC News with Jamie Robertson
Trading on an established relationship - as diplomatic
allegiances shift around the world China and Russia look to each other
Live from London, that's our top story on Monday 3rd July.
Today Xi Jinping is in Moscow to meet the Russian
Trade is set to be top of the agenda as China looks to push its vision
Would you buy a smartphone that had parts taken
We're going to have the latest on Samsung's move to salvage
Galaxy Note 7 parts for a new device.
And China is opening up its $9 trillion bond market
to foreign investors - we have the latest
from the markets on how they are reacting to that news.
And we'll be getting the inside track on augmented reality -
after the failure of Google glass could the future of the technology
Elsewhere, as tents go up outside Wimbledon with tennis fans desperate
to get their hands on tickets, we want to know -
what would you queue through the night for?
Chinese President Xi Jinping is in Russia for talks
with his counterpart Vladimir Putin today.
Trade is set to be top of the agenda ahead of the G20 meeting of global
The visit will be Xi's sixth tour to Russia
And their meetings seem to be bearing fruit -
according to China, trade between the two increased by over
26% in the first four months of the year, reaching nearly
Russia will be a key component of China's 'Belt
and Road' initiative - an ambitious multi-trillion dollar
project that will link Europe and Asia via the historic silk
As part of the project - and as a symbol of this
close relationship - Beijing has even agreed to help
finance a high speed rail link within Russia itself: linking Moscow
Joining me now is Dr Yu Jie, Head of China Foresight, at LSE Ideas.
thank you for coming in to Doctor us. This is a charm offensive that
just keeps going, because we have seen six of these meetings already,
and not just Russia, but China forging links all around the world,
to boost its profile, not just economically but politically? That
is exactly what China are trying to do, by using China's economic
muscles and trying to extend the spheres of political influence over
the world. As you just mentioned, the road, including not just rush
about 68 member states allowed to join the initiative and Russia is
obviously Big E member. If Xi Jinping would like success on this
initiative -- obviously the biggest member. Why is the initiative called
the belt and roared initiative? The new Selt Road, the economic belt,
and the road, which is the new economic silk, so there is a land
route going through Central Asia, and end point would be Venice, in
Italy. Looking at the map, Russia does not have to be part of this,
does it? The entire route could actually go south of Russia. How
important really is Russia in this relationship, regarding the root?
Not exactly economically, but I think it is more geopolitically that
Russia is vital, to have Russian support in this case. Russia,
obviously the backyard is Central Asia, or it used to be, but now
would like to win the hearts and minds -- now Xi Jinping would like
to win the hearts and minds. And it is essential for him, for himself.
Politically, is this a kind of centring of powers as a hedge
against the powers, the partnership between the USA and Europe, a kind
of China and Russia relationship? I wouldn't say it is hedging
necessarily. I think it is partially because the diplomatic language.
When the rest speak of Russia it tends to be much harsher, whereas
the Chinese offers more toned down language towards Russia is what
China is trying to do is gather more and more powers and a balance
towards the United States. Doctor Yu Jie, who do you think is in the
driving seat in this relationship? It depends on what you look at.
Certainly economically China is the driving seat here, but I think in
the political sphere both China and Russia play an equal part. Doctor Yu
Jie, thank you very much for speaking to us. Doctor Yu Jie from
LSE Ideas. Let's take a look at some of the other news stories today.
China has for the first time given foreign investors access
to its bond market - a $9 trillion trading
system which is the third largest in the world.
The scheme, which offers investors access via Hong Kong,
got off to a busy start, with nearly $300 million'
worth of bonds purchased in the first 20 minutes of trading.
Iran says the French energy giant, Total, is to sign a contract worth
almost $5 billion to develop an offshore gas field.
It's Iran's biggest foreign deal since most economic
sanctions against the country were lifted last year.
Total said it had planned to sign the contract several months ago,
but had decided to wait and see if the Trump administration would
India introduced a landmark reform to its tax system over the weekend.
The "Goods and Services Tax" replaces hundreds of individual
state-based levies, and is expected to transform the nation
of 1.2 billion people and its $2 trillion economy
Looking at some of the stories in newspapers... Japan's second biggest
bank is setting up a new branch to ensure it can continue offering
disruption to clients with no disruption was the UK leave the EU.
And the bank said it would expand its office in London to achieve
greater flexibility. So putting a foot in both camps. Samsung is to
salvage parts from its catastrophic to make a new phone for the South
Korean market. Leisha Santorelli is in Singapore. This new phone, will
it inspire confidence if it is made from parts that blew up? Well, just
going on social media it is getting mocked online already, but that is
not the aim of Samsun with the new release. They have brought the
Galaxy Note 7, famous for its exploding batteries, back from the
grave, but in South Korea it is being called the fan edition.
Samsung says 400,000 pieces will hit stores on Friday costing around 610
US dollars, about 30% cheaper than the original As you mentioned it
will be made up of unused parts from the recall to which was axed because
of these faulty batteries. Almost 3 million handsets in total have been
recalled, costing Samsung billions of dollars. It is possible selling
these refurbished phones is one way Samsung is looking to soften the
financial blow. They are also looking to minimise the
environmental impact of that big recall, so instead of throwing the
phones away they will reuse parts of it. Most importantly for consumers,
I think they are looking to see that this new phone will have a safer
battery. Samsung says it does and that the battery will be smaller as
well, so we will just have to see what the demand is when it goes on
sale on Friday. Leisha, thanks very much for that. Let's have a look at
the markets. This is the Asian market overnight. Although deemed
reasonably positive. The Hang Seng and the Dow numbers here. The Nikki
is up one tenth, and a similar amount up here in the trading
system. The Nikkei up largely on the back of reasonably good economic
figures out of Japan, but looking forward to the week ahead, Michelle
has the details about Wall Street's future. Americans celebrate
Independence Day on Tuesday, so while the US markets may be open for
a shortened trading session this Monday, or will they be choosing to
stay on? Plenty of economic data to digester for those heading into the
office. Early estimates on car figures suggest an annual rate of
16.6 million vehicles sold. Given if there is an important element of
consumer spending, investors will look at the details for any evidence
the US economy may be running out of steam. For a snapshot of the
manufacturing sector, the Institute for Supply Management has released
its figures for June. It is expected to have increased to a reading of
55.1 from 54.9 in May. That was Michelle in New York where the --
well the European markets have opened half a percent up. Kathleen
Brooks from City Index is here. We will talk about more normal market
at the minute but first let's talk about is opening up of the bond
market in China. How significant is this? Certainly it is a step towards
financial normalisation, I suppose. China's bond markets or trillion. It
is no small chunk of change -- they are multitrillion. It is interesting
because some fund managers that might hold off, the Met control our
pension funds, for example, and they could start investing in bonds in
China for the first time. Haven't they been a bit worried about debt
in China for the last year and so? A good point. This concern about the
debt bubble. However opening things up to the debt markets can sometimes
allow more scrutiny. Fund managers have strong vetting process in place
before they invest. So companies that are not perhaps selling the
best kind of debt, supply and demand will mean people will not buy it.
Let's talk about what has been happening today. We have seen
European markets rise slightly. The financial is not doing too badly at
the moment, but we also have today four former Barclays executives in
court. Do you think this will have any impact on share prices in the
medium to longer term for Barclays, for example? We don't think so,
certainly not of the share price. Barclays have suffered in other
ways, for example, their book value, how much essentially investors want
to own Barclays. And there is a big discount to that, so people are
saying, they are kind of... They have been avoiding Barclays during
this whole process but forgetting to court stage is almost the last steps
we would expect some financials to do quite well now including Barclays
and actually for them to ignore the actual outcome. We have had a lot of
scrutiny, this case has been building up for over five years, so
now the horse has bolted, if you. Potentially if there is no other
regulatory concerns in the way... We have seen the regulatory glare
turned more towards tech than financials which could be good news
for financials down the line. Kathleen Brooks, as usual, thanks
very much for that update on the markets. Thank you. Still to come...
Science fiction becoming science fact. We will be looking at how
augmented reality could be coming to a business near you in the not too
distant future, if it is not there already. You watching business Live
from BBC News. Boris Johnson has become the latest senior Cabinet
minister to put the Chancellor and the -- to put pressure on the
Chancellor and Prime Minister to end the public sector pay cap. Sources
close to the Foreign Secretary made it clear that he wants better pay
for public service workers. Theo Leggett is in our business newsroom
- what's the row about? Policy introduced when George Osborne was
Chancellor and maintained under Philip Hammond has been to keep the
cap on public sector pay, part of the austerity measures designed to
reduce the budget deficit, reduce spending. Since 2012 annual rises in
public sector pay have effectively been capped at 1% for millions of
workers. For that there was a pay freeze as well. The problem is no we
are in an era of rising inflation, at 2.9% at the moment, -- now we are
in an era of rising inflation. In the wake of the election result, the
Government is pretty well aware this is an unpopular policy, and so we
have this line up of senior ministers, Michael Gove, Jeremy
Hunt, Boris Johnson, or suggesting now is the time to relax this policy
and let public sector workers have a little more. If they manage to do
that, it is more pay for everybody, how can they afford it? Everything
has a price, doesn't it? The options are you could increase taxes, and
that is one way potentially of increasing revenue, but there are
problems with that. If tax rises are two great it can dampen economic
growth and you end up taking in less tax than you started with. It is
also politically quite unpopular. The Government could borrow more and
finance its spending that way, but that goes against a flagship
Conservative Party policy which is to reduce the budget deficit,
Ridgers overspending. So that is a couple of ways, or it could just cut
back on other Government programmes. We are talking about a very
significant amount of money here. The Institute for Physical Studies
is lose the figures that were, the political price, and again people
don't like to see cuts. Theo, thank you very much
Our top story; Chinese President Xi Jinping is in Russia for talks
Trade is set to be top of the agenda ahead of the G20 meeting of global
The Conservative manifesto was absent
A quick look at how markets are faring.
Now let's get the Inside Track on augmented reality; it's growing
technology where computer-generated images can be superimposed
Some estimates say the industry could be worth around
Our next guest DAQRI has been using this technology in industrial
settings like oil rigs, water treatment plants
Users wear a special helmet that allows them to view a piece
of machinery such as an oil pipe which has an engineering diagram
with us here is Brian Mullins, founder and CEO of DAQRI.
You have brought the helmet and smart glasses with you. We should
try them on. Unfortunately, we haven't got the software so we can't
show you what the image looks like but we can show you what we look
like! There we are. The whole idea is
there. My head is too big. I tried on the glasses earlier and I
couldn't get them on at all! There we go, look. Is it meant to go up
like that? Yes. Many various diagrams will arrive in front of
your eyes? Yes, that is right. You can take them to work with you and
you can see really complicated instructions boiled down in front of
you in 3D and it can help you learn faster and remain more. One of the
most interesting things about augmented reality, although it talks
a lot today about the context of consumers in enterprise, it's
already here today. So what applications are you using it for at
the moment, which companies are you working with and how is it being
used? Customers are using it in the field today to service very complex
and expensive equipment like gas turbines and power plants, wind
turbines and energy. Places where workers have to go out in the field
and have to know how to understand and service and keep running very
complex equipment. How much does this thing cost that I couldn't get
on to my head? So the prices are usually part of larger package with
channel partners. You could expect to pay list price of $10,000 and
that allows a worker though to do more in those environments than they
could possibly do before. In fact, the economics often pay for
themselves very quickly when an expert in Austria no longer has to
get on a plane, two to Brazil and service a piece of equipment. What
interests me about this is, you buy the kit and software, but are there
then ongoing costs as you keep the programme going on, and I assume
that's what could be good for you? Part of our business model is
helping customers to do what they do better. We have worked with
companies like Siemens and case studies we have done together shows
drastic reductions in the time it takes for workers to learn
activities that may have taken four or five hours to learn in the past
can be done in less than 40 minutes. So you know that? We have a study
that we published with multiple workers specifically in the context
of a power plan. Other companies and universities like Iowa state have
published independent research that shows that workers can learn faster,
retain more and reduce the time it takes to learn by over 90% and...
90%? That's right. And have a significant impact on the way that
workers can move throughout their career. It's a very competitive
market place isn't it. You have Google and other big tech firms
launching all of their own brands. Won't you get swallowed up? It's a
competitive space. We see augmented reality is not a one-size-fits-all
application. A loft what we do, whether in a helmet or in your
glasses, is about helping AR to adapt to the business needs of
customers. One of our fastest growing applications is augmented
reality for automobiles where our partnership with Jaguar Land Rover
has our technology on the road in hundreds of thousands of vehicles
today. That's probably where consumers will see augmented reality
first. Thank you very much indeed. Do you want to try this on? I've
already done that in the green room! They didn't fit me!
Now it's time for the latest in our CEO secrets series.
A lot of successful bosses started out very young, forging businesses
while still in university or high school.
That's right, but the CEO of icoolKids takes things to a whole
new level.Jenk Oz is just 12 years old but he first came up
with the idea when he was, wait for it, just eight.
The most important thing is to form what I call an idea board of
directors. This is about five to six people who have varying different
backgrounds and different life experiences. They have to be great
listeners, completely impartial. I think you should always have someone
who is adult and always have at least one person who is a bitter
younger than you and help you expand on your ideas that you already have
and having someone to tell you who is good and could possibly go wrong.
You keep going with your ideas. Social media - likes don't matter,
followers don't matter. Keep going and engage with your community.
The BBC's Dominic O'Connell is with us.
Let us start with this story about Saudi's oil company. The story is
not about what it says on the tin. Everyone knows they do chemicals.
Saudi is looking at floating on the western stock exchange. Probably
right here in London with a two trillion dollar estimation, but it
probably won't be anything like that. The reason this story is
appearing is to show that it's not just oil, it makes other chemicals.
It's about driving up their valuation ahead of the pricing. Let
us move on to what our next stories are. It's about floating of
valuations, a huge one penneltially on the cards for Deliveroo. It's
been a unicorn, it's a term for normally an online company that
doesn't make any money but which is valued at more than a billion
dollars by investors. If they are doing a funding round, you work out
how much the total company is worth. This latest funding is around 1.5
billion dollars. That is a number people just make up isn't it?
Unicorns are also, when they stop being unicorns, they're uni-corpses.
This business model and working in this economy... It's another example
of an economy which says all its riders ride with their big boxes on
their backs, most young kids riding for a few hours a day, they are not
all employed by Deliveroo, they're self-employed and don't have any
rights which is a bone of contention for all these types of economies.
Are you thinking of queueing up for Wimbledon? I can't think of anything
that I would line up for. You had a good idea? I would queue through the
night to buy a house but Joey tweeted to say he'd queue through
the night for a ticket to see that Don that that. Matt says -- Madonna.
Matt says Bruce Springsteen for a ticket at the front row.
This happens year after year at Wimbledon. If you two to Wimbledon,
normally you walk past the queue in the park and it's not just a small
queue, this is a queue that goes on, 600, 700 metres, even more. The
pictures are like Glastonbury actually. Camping. A very smart
Glastonbury. Fantastic. Dominic, Good morning. We started off July on
a decent note across most