22/08/2017 BBC Business Live


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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


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