22/08/2017 BBC Business Live

This is Business Live from BBC News with Ben Thompson and Rachael Horne.

Trading with Trump South Korea steps up to the table

to negotiate a new trade deal with the world's largest economy.

Live from London, that's our top story on Tuesday 22nd August.

South Korea and the US may be staunch allies when it

But today the two sides will face off on a trade deal that

And mining big returns, BHP Billiton bounces back

from losing billions to making billions in just one year.

And that's because commodity prices have soared but why and what else

is moving the markets; we'll get the expert opinion

And we'll be getting the inside track on the growing

demand for getting big sound from digital speakers

Rising house prices in the UK have lead to a sharp rise in homes little

So today we want to know would you or do you live in a Micro Home?

Do you think at 6'6" I could riv in a microhome? Probably not! Get in

touch with us with your stories. The importance of trade deals

between big economies is back Hot on the heels of Canada

and Mexico - now it's the turn of South Korea

to renegotiate its trade President Trump has already

described that pact as 'horrible' South Korea is America's sixth

biggest trading partner. Since the deal came into effect,

the US says the trade deficit has doubled from $13 to $27 billion -

it's importing much more from South Korea than it

sells to the country. But some experts say that mismatch

could be even greater That deal eliminates 95 per cent

of tariffs on consumer and industrial products -

as well as creating And they also highlight

how much South Korea's is investing in America -

up from $4.8bn in 2011 Joining us from Beijing

is Miha Hribernik, a senior Asia analyst at global risk consultancy

firm, Verisk Maplecroft. Thank you very much for joining us

on the programme, Miha. Donald Trump has a problem with this growing

deficit. He thinks they affect manufacturing jobs in the US,

something that is very important to him. Is there any evidence this

trade deal with South Korea has damaged jobs in the US? Well,

unfortunately, any free trade agreement will have a negative

impact on jobs, particularly in manufacturing and other industries

that are unable to compete either in terms of cost or in terms of quality

with goods and services coming from abroad. Now, that does tell only

part of the entire story. If we only look at the automotive sector for

example, it's frequently cited as one of the biggest victims when in

fact the tariffs on imports of Korean cars were at 2.5% even before

Corus came into effect and remained at that level until last year when

they were abolished. So the US auto industry has a lot of problems, this

Free Trade Agreement doesn't tell the whole story. I would go back to

the figures you cited earlier, looking at job creation, there's

evidence that suggests that tens of thousands of jobs created as a

result of the agreement, if we are just looking at the impacts of

direct foreign investment in companies, that figure is about

45,000. What about South Korea? How that is this trade deal been for

them? They are not calling for it to be axed like Donald Trump is? Well,

for the South Korean side, these calls for renegotiations come at an

unfortunate time, at a time of increased tensions tonne Korean

peninsula when President Trump and President Moon need to coordinate as

closely as possible and essentially having a trade dispute will make

this very difficult. There was a pole published by a research centre

recently suggesting that more South Koreans trust Vladimir Putin to do

the right thing in International Affairs. They trust him more than

they do Trump and so the perception of the US President essentially

forcing renegotiation of a trade deal on one of the US's closest

allies is not going to win him any friends. As far as the government

and negotiating tactics are concerned, it seems like they'll try

to delay negotiations as soon as possible. They see the deal as

mutually beneficial and they have stated that any renegotiation will

need to be preceded by a come preheroin sieve study of the impact

of Corus since 2012, including on job creation. Briefly, Miha, last

weekend's negotiations were inconclusive for NAFTA. What would

be seen as a successful outcome of the negotiating talks there? It

depends on which side you were to ask. Obviously, the key goal of the

United states is to bring the deficit down, as well as South Korea

seeing the deal as essentially win-win, as they frequently describe

it. So I think there'll be a very difficult and protracted process

ahead. Thank you very much. Let's take

a look at some of the other Johnson Johnson has been ordered

to pay more than $400m to a woman who says she developed ovarian

cancer after using products Johnson Johnson has defended

the products' safety The British Airline Pilots'

Association says it's backed a strike by Thomas Cook pilots

in a row over pay. The dispute comes after nearly eight

months of negotiations over a pay Pilots will walk out

on September the 8th. Shares in Great Wall Motor Company

have been suspended The company admitted on Monday

that it was interested in making an approach

to Fiat Chrysler Automobiles, The mining giant BHP has

returned to profit - making almost $5.9bn over

the past twelve months. It got a big boost from

higher commodity prices, and that helped it bounce back

from a big loss last year. It's interesting because we have

talked a lot recently about falling commodity prices and therefore the

direct effect on companies like BHP is that they struggle. We have seen

exactly the reverse this last few months? Absolutely, after doom and

gloom across Australia which has benefitted a lot over the last

decade from commodities, it could be back to the good times for companies

like BHP who've made nearly $6 billion in profit, driven by the

demand from China for prices being up 32% and also products like the

coal and oil, the traditional commodities BHP sells across the

world. A good day for them, especially considering last year's

losses. Maybe not quite reaching as high as the analysts expected.

Certainly the profits for Rio Tinto suggested the whole sector is in a

boom time and still good enough to triple the dividends to the BHP

shareholders. You can see on the screen there, the BHP share price up

32%. We find out whether the Central

Bankers will give anything away later.

The chair of the US Fed and the President of the European Central

Bank later will have their say. We heard one bright spot for Asian

markets was the performance of the mining sector, all metals doing

well. Let me show you what is happening in Europe. There'll be

that interest later in the week in what Mario Dragi has to say. Any

indication that the European Central Bank is thinking about cutting back

with tapering, that may come later. Michelle has her assessment now on

what matters on Wall Street today. Investors will be watching Cote's

results, the perfume maker expected to announce a rise when it posts its

results. Second quarter results out for other companies. Revenue at the

Cloud based software firm is expected to go up despite increased

opposition from Oracle. The housing market will be in the Spotlight this

week, Toll Brothers turns in its results for the third quarter.

Profits and revenue likely rose. The US federal housing agency is

expected to increase housing price index for June.

Joining us is Kathleen Brooks, research director at City Index.

Thank you very much for coming in. Let's start with commodities, Ben

and Hywel were talking about that with the BHP results. We are seeing

a surge aren't we? Yes. The steel price has tone really well and the

copper price. These less top tier commodities you don't hear about.

All has been floundering a bit. If you dig deeper, there are things

going on. When the fundamentals are doing well, that's when we should

see the share price doing well. That's very good for the FTSE 100.

The iron sector is worth about 20% of that. Where is that demand coming

from? Traditionally it's been China popping it up, we have seen that

slowing down in China and anecdotal evidence suggests it's not coming

from China this time. Who is buying this stuff? You are seeing a

mixture. When demand slows or growth slows in a big market like China,

you see the commodity companies immediately start to ramp down

production, so that leads to a bit of a supply issue in those commodity

markets because it means there's not enough. So when growth starts to

pick up again, like in Europe and the US growth is ticking along

nicely, European growth is very strong and nice and broad-based as

well, when you see that pick up, all of a sudden, there is a massive

demand for the metals, shooting the price up. It's not as smooth as you

think it would be. This morning I said what should we talk about and

you were saying, there's nothing, it's quiet. Everybody's waiting a

little bit for this Jackson Bank talks. What are you expecting them

to say? Not much. You have different authorities, none of them want a

strong currency husband we are in a Le inflation environment, high

equity prices and strongish growth. The risk is, if you say something,

say Mario Dragi says yes, we are going to taper, stocks will fall and

the house of cards come down. It's a race to the bottom, no-one wants

that to happen. We may talk about this again as the week goes on, if

there's nothing else to talk about some times in August! For now, thank

you very much. Still to come...the

sound of success? Would you spend big money

on posh, high end speakers? We meet the man behind one

of France's audio success stories who's just secured 100 million

euros in funding. You're with Business

Live from BBC News. Supermarket sales in the UK

grew 4% year on year, despite a bad summer

hitting seasonal sales. Each of the top four supermarkets

increased market share for the 5tgh quarter in a row, according

to latest figures from Kantar. Theresa Wickham

is a retail analyst. You have been looking through the

numbers. Good morning. It's a familiar tale isn't it, that the

supermarkets are all vying for the same customers but interesting

they've managed to increase share? Yes, they have. They've tackled the

point of the discounters very clearly by having less promotions

and more regular prices. That's what customers want. Also they're growing

their online sales, so they've had good growth this time. When we talk

about the competition between the traditional supermarkets and the

discounters, you're right, what a lot of customers have told us is

just keep it simple, stop confusing us with all the offers. That

message, you are suggesting, has got through now? Definitely it got

through on the regular things people buy every week. They've tried to

keep the prices low there and also advertise the fact, that this is a

regular price, it won't change. Other prices have gone up, food has

gone up and it's bound to go up, partly because of the weak pound.

What are we spending our money on because we saw sales of ice-cream

down 9%, burgers down 25%. That's a sad reflection of the summer we have

had? Yes, we'll be buying a lot of fresh produce this time of the year.

Fresh produce sales have gone up, strawberries, raspberries, that sort

of thing and of course, once the schools are out, families are

looking for big bulk buys and shop for value.

If we look on the BBC News website one of our tops Tory tizz about the

Ford scrappage scheme. Scrappage scheme for pre-2010 cars. They are

also accepting petrol cars, but cars registered before 2010. This is

really to do with all those manufacturers coming together trying

to do something about the clean air issue and moving towards electric,

towards hybrid. Just a month ago we reported the UK Government said by

2040 we would be looking towards all new hybrid and electric cars, no

more petrol or diesel. Full details on the website.

Our top story - South Korea and US began talks on possible revisions

to a five-year-old free trade agreement, as the US

Administration seeks to follow through on President Trump's

pledge to cut deficits with trading partners.

There is a big trade deficit. America importing more from South

Korea than it sells. President Trump does not like that.

A quick look at how markets are faring.

Not a huge amount of movement. The FTSE and the Dax up about half

percent. Lots of investors waiting to see what happen? Towards the end

of the week, waiting to hear from the central bankers. She believes

will not get any big headlines. We will keep talking about the market

spooling through this. Now, how do you listen

to your music? Or with super hi-tech,

top notch speakers? Well apparently the market for high

end, expensive audio Devialet makes them,

and has just received one of the biggest funding

rounds in French history, raising over $100

million from companies, Devialet's co-founder

and chief executive, Quentin, thanks for coming in. Tell

us why you got involved with this in the first place? You talk about

sound being about emotion. Where does that, from? It is coming from a

dream when I was very young, 40 years ago. My dream was to create a

company in audio. One day, ten years ago, my friend called me and he had

found a guy who had invented a wonderful technology to amplify the

sound. This technology can change everything. We founded it together

and said up the company in 2007. From this time, what we are going to

do is put out technology step-by-step in any device providing

sound. This is the kind of device we are doing with the Devialet brand.

The plan is to put the technology in your car, your TV, your smartphone,

and provide the sound of the future, more emotion. You are trying to put

it in these different devices. It strikes me like -- that devices like

these are getting smaller and televisions are getting flatter.

Speakers need space to move the air and make the sound. How do you do

that? It is already what we are doing with this product. This

product should be 30 times bigger to provide the sound it is providing.

Our technology, because we are using hybrid technology, our technology is

changing the way that we are providing the signal to the speaker.

With this technology we can reduce the size of the audio equipment. It

is a big advantage. With this product we reduce the size. This

product is providing 14 hertz. You don't need that kind of sound in

your smartphone. Step-by-step we will provide this technology. We

will provide a great sound in a tiny space. Just like your smartphone.

You say you can do it better than anybody else. What is different

about the sound that you create and is it -- do you have to be a sound

engineer to hear the difference? No, everybody can feel it. When we are

talking about someday, a lot of people say they are not experts,

physicians, but switch off the image in your TV and when you are watching

a movie a lot of the emotion is coming from the sand. And everybody

is able to feel it. What we are providing is sound without noise,

without distortion, the pure sound of the reality. You are able to feel

it. We are very skilled. We have wonderful abilities to recognise a

very pure sound. You talk about putting such technology in things

like cars. It strikes me if you are driving in a car, you have got

traffic noise, sirens, horns, people around you. It is not that pure

environment. It's not like you are sat in your lounge with a big-screen

TV and cinema. It would be noisy. Is it necessary? We love that because

there are a lot of problems to fix. The kind of application in your car

is different to what you can have in your TV and your living room. In

your car you have sound insulation. You have to deliver a different

sound for the driver. Safety information, routing information

access. The driver can listen to one thing and the passengers something

else? Yes. At the same time the car is autonomous, electric. You are

saving kilometres. You are able to deliver a car that can go further.

That is the purpose of our technology. To be smaller and to be

lighter, and in a car to fix many problems you have delivering with

the sound in different places in the car. Quentin, thank you for your

time. 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 businesslike pages where you can

stay ahead with all of the days breaking news. We will keep you up

to date with insight and analysis from our team of editors around the

world. We want to hear from you. Get involved on the Business Live web

page. You can find us on Twitter and Facebook. Business Live on TV and

online whenever you need to know. We are joined now by Dominic

O'Connell to talk smack through all of the business news happening

today. You picked up the Ford scrappage scheme story. Any car you

take them that is older than February 2009, they will give you a

?2000 incentive. It is about air quality, that is what they are

claiming. Really it is about political heat on car-makers over

diesel, I think. Volkswagen in Germany is offering you 10,000 euros

to buy a new diesel car. The one difference with Ford, they are

scrapping old cars. This applies to petrol cars as well? Yes. It has

just been diesel before that. Previous scrappage scheme -- schemes

have been from governments. Getting the wheels of the economy turning.

Excuse the pun! Car sales are reducing. It is about clean air

quality. The Trumps bar Lago club losing its ninth big charity event

this week. It is interesting. This is Donald Trump's main resort in

Florida. A local charity has said it will not hold a dinner dance there.

$240,000 worth of business has passed Trump by. They say they can't

book it. There are negative effects on Trump's business. He will know

that. You will think about it. That is quite a personal thing. When he

goes down there in the winter, the ballrooms will be empty. Absolutely.

It was thought that he would use the presidency to further his business

interests. He didn't think it would harm them. I would imagine that

O'Connell Towers is a vast palatial mansion. We are talking about

microforms today. House prices soaring in the UK. Some people

living in smaller houses. A lot of people getting in touch saying the

problem with cities, we have some e-mails. Caleb says house prices

have allowed these hot property prices to bloom to nonsensical

figures. It is a problem, isn't it? It is a problem of urban

concentration, rising house prices. Microforms are a feature of the

Japanese market. They have been in London for a while as well. It is

not particularly new. What is interesting about this story is it

is spreading to the Midlands. Some of the smallest properties they

found were in Leicester. They found one which was one square metre

larger than a prison cell. That was in Greenwich in London. No thank

you. Thank you. Macy says she has just

moved to the country. Live with nature, you get a bigger house.

Oscar says his student house was perfect for one person. Thank you

for your comments. There will be more business

news throughout the day on the BBC Live web page,

and on World Business Report. Good morning. We have got a lot of

tropical air sitting across many parts of the UK at the moment. That

is bringing a muggy start. Temperatures widely into the mid to

high teens. Also, a lot of tropical moisture