:00:08. > :00:10.This is Business Live from BBC News with Ben Bland and Jamie Robertson.
:00:11. > :00:13.The White House says President Trump will talk tough on trade with China
:00:14. > :00:17.when he visits Asia next week, we look at what's at stake.
:00:18. > :00:36.As China's Party Congress draws to a close -
:00:37. > :00:38.Washington says it plans to tackle Beijing's "predatory
:00:39. > :00:43.Also in the programme - the United States is imposing
:00:44. > :00:45.limited measures against Myanmar in response to the treatment
:00:46. > :01:00.This is how the markets are doing. Not much movement in London and
:01:01. > :01:04.Not much movement in London and Frankfurt.
:01:05. > :01:07.A bright idea in renewables - one of the leaders in
:01:08. > :01:10.storing solar energy - Sonnen - will be here to discuss
:01:11. > :01:12.taking on rivals Tesla and setting up projects in hurricane-hit areas.
:01:13. > :01:15.And as a car finance firm issues a profit warning
:01:16. > :01:18.because of falling new car sales - we want to know -
:01:19. > :01:45.Would you boy a new car not a used one, especially not from Jamie.
:01:46. > :01:47.Today marks the last day of the five-yearly Congress
:01:48. > :01:50.in China, which has confirmed Xi Jinping a second
:01:51. > :01:56.Xi will even have his name inscribed in the party's constitution,
:01:57. > :02:02.placing him alongside Mao in the Chinese pantheon.
:02:03. > :02:05.But as Xi consolidates his power, America is ramping up the pressure.
:02:06. > :02:13.On Monday, the White House said that on his forthcoming
:02:14. > :02:16.trip to Asia next week President Trump will press China
:02:17. > :02:20.to cease what the White House calls its "predatory trade practices".
:02:21. > :02:22.And he will do that by addressing the "problem
:02:23. > :02:32.So far this year, the US has imported goods worth over
:02:33. > :02:43.$319 billion from China, but only exported $80 billion worth.
:02:44. > :02:50.But here's the question - will China be in any mood to listen?
:02:51. > :02:51.We're joined by Sarah Fowler, International Economist,
:02:52. > :03:08.Sarah, what is America trying to get, what is it trying to do? So,
:03:09. > :03:12.Trumps team has this impression that the goods deficit has caused a lot
:03:13. > :03:18.of job losses in the US manufacturing, research over the
:03:19. > :03:25.last 20 years since China ranked up its trading shows technology is much
:03:26. > :03:32.more the cause than trade. So Trump's narrow focus is on narrowing
:03:33. > :03:38.this goods manufacturing deficit with China, but actually the
:03:39. > :03:41.services surplus, the US runs quite a bit services surplus which has
:03:42. > :03:52.risen very fast over the last decade. Is he not ignoring the
:03:53. > :03:57.services? He is. It, the services surplus is much smaller than the
:03:58. > :04:04.goods deficit, which is why it is perhaps not noticed so much. Is it
:04:05. > :04:07.growing quite fast? Yes, the way the Chinese economy is rebalancing, the
:04:08. > :04:11.services sector in China is growing faster than the goods manufacturing.
:04:12. > :04:17.So how do you think, how, what does China feel about this? China
:04:18. > :04:23.obviously, in terms of its service sector, wants to see it developed,
:04:24. > :04:29.does it feel kit do that still with an open services trade with the US?
:04:30. > :04:38.Yes. Services trade is absolutely crucial to China as it rebalances
:04:39. > :04:43.its economy, so earlier in year, the US started an investigation, a probe
:04:44. > :04:47.into China's intellectual property because what has happened US tech
:04:48. > :04:55.firms have struggled to make progress in the Chinese market. So
:04:56. > :05:01.Donald Trump may be perhaps looking for a legislative win before the
:05:02. > :05:08.midterm elections, because policy progress has been somewhat slow, and
:05:09. > :05:10.so on the intellectual property side China could make some modest
:05:11. > :05:16.concessions. The elephant in the room is going to be North Korea, how
:05:17. > :05:23.does the North Korean situation play into trade relationships between the
:05:24. > :05:32.US and China? Well, so, I think they both effectively want the status quo
:05:33. > :05:37.with North Korea, for the US, imposing more sanctions, would hurt
:05:38. > :05:41.its own economy because North Korea trades with about 80 country, the
:05:42. > :05:47.Treasury, the US Treasury has the power to impose sanctions on any
:05:48. > :05:52.multiculturals or banks that do business in North Korea, but that of
:05:53. > :05:57.course would hurt the US economy as much as every other economy. From
:05:58. > :06:03.the North Korean perspective, while more sanctions would hurt their
:06:04. > :06:09.living standards, the elites could protect from that, and quell any
:06:10. > :06:14.social unrest in the population, buzz for North Korea, it would
:06:15. > :06:17.eventually raise the cost and the risk of the more nuclear
:06:18. > :06:19.development, so the US is likely to keep that threat there and stop
:06:20. > :06:23.them. OK, thank you very much. Let's take a look at some of
:06:24. > :06:35.the other stories making the news. Google's new flagship smartphones,
:06:36. > :06:38.the Pixel 2 and Pixel 2 XL, have received complaints
:06:39. > :06:40.about the quality of the screen. Tech reviewers, who have had
:06:41. > :06:42.the device for about two weeks, noticed "burn in" on the display,
:06:43. > :06:45.while others noted "muddy" Google said it was investigating
:06:46. > :06:48.the issue, which it A court in New York has found
:06:49. > :06:52.a former HSBC trader guilty of defrauding a British energy
:06:53. > :06:54.company in a $3.5 billion US prosecutors accused Mark Johnson
:06:55. > :07:00.of exploiting confidential Investors have been selling off
:07:01. > :07:11.shares of toymaker Hasbro. Its stock price tumbled by 10%
:07:12. > :07:13.after the firm warned that Toys'R'Us The fall came despite
:07:14. > :07:20.better-than-expected earnings. Hasbro saw quarterly profits rise
:07:21. > :07:24.to 266 million dollars due to strong sales of its Transformers
:07:25. > :07:38.and My Little Pony franchises. The United States has announced
:07:39. > :07:42.limited measures against Myanmar in response to the treatment
:07:43. > :07:44.of its Rohingya Muslim minority. It is considering targeted economic
:07:45. > :07:46.sanctions against certain individuals it believes
:07:47. > :07:48.responsible for the violence. First, Karishma Vaswani
:07:49. > :08:05.is in Singapore. What kind of sanctions are these
:08:06. > :08:10.they are thinking of bringing in? Jamie, the sort of first indications
:08:11. > :08:14.we are seeing or early indications of how seriously the US State
:08:15. > :08:20.Department is taking this issue, it says it is gravely concerned with it
:08:21. > :08:24.and added in the statement from the State Department its imperative that
:08:25. > :08:27.individuals or any entities responsible for the atrocities in
:08:28. > :08:35.the state should be held accountable. The US decided won't
:08:36. > :08:38.allow any Burmese officers is to participate in US assistance
:08:39. > :08:42.programmes, that means it is cutting off military assistance to them, but
:08:43. > :08:46.with regards to economic sanctions, the things they are considering
:08:47. > :08:50.against targeted individuals associated with the violence would
:08:51. > :08:54.allow for visa bans and asset freezes of this individuals, so
:08:55. > :08:57.serious considerations with regards to sanctions in Myanmar. OK. Many
:08:58. > :09:19.thanks indeed. And the markets. We don't talk about
:09:20. > :09:23.the New Zealand dollar very much, with the incoming Labour Government
:09:24. > :09:28.coming in it could prove negative for the New Zealand dollar. Let us
:09:29. > :09:35.look at Europe. Not a huge amount of movement. Some political tensions,
:09:36. > :09:39.of course the rumblings continue in Catalonia, the issue of whether they
:09:40. > :09:45.want to break away from Spain, and also the far right party AFD taking
:09:46. > :09:50.their seats in the German Bundestag later today. The other thing
:09:51. > :09:53.investors are watching is the meeting of the European Central Bank
:09:54. > :09:57.which happens this week and the Bank of England and what they might do on
:09:58. > :10:02.interest rate, that meeting is happening next week. First let us
:10:03. > :10:04.take a look at what is happening on Wall Street.
:10:05. > :10:07.Several companies will be reporting earnings on Tuesday.
:10:08. > :10:09.The recovery in the construction city will help Caterpillar's profit
:10:10. > :10:12.The heavy machinery manufacturer which has been battered
:10:13. > :10:17.in the last few years by a slurp slump in oil and commodity prices,
:10:18. > :10:20.as well as weakness in China, but is seeing a rise in construction
:10:21. > :10:26.equipment sales in China specifically, because of increased
:10:27. > :10:35.It has been trying new menu items to try and
:10:36. > :10:37.Things like fresh beef quarter pounders and
:10:38. > :10:46.But it seems that its $1 drinks drove up traffic.
:10:47. > :10:48.And while we are talking about fast food,
:10:49. > :10:50.we should talk about Chipotle, which has also reported a rise
:10:51. > :10:55.The chain has been trying to recover from a few food safety lapses.
:10:56. > :10:57.Most recently one restaurant had to close because of an outbreak
:10:58. > :11:04.David Bloom, Global Head of FX Strategy at HSBC joins me now.
:11:05. > :11:14.Street. Receive We were talking before we came on the programme,
:11:15. > :11:18.about why people aren't concerned is about politics, they, the thing that
:11:19. > :11:23.is concerning markets is the central banks and round the world and what
:11:24. > :11:32.they will be doing, can you take us through that is the The financial
:11:33. > :11:35.crisis in 20062007 and wait for the first-rate rise in 2015, and they
:11:36. > :11:41.have been raising rate bus the next wave has started. We saw the
:11:42. > :11:46.Canadians couple of months ago do their first hike, this week we are
:11:47. > :11:50.look for the ECB to reign back and next week the Bank of England is
:11:51. > :11:55.going to drop the clanger by raising rates in the UK for the first time,
:11:56. > :11:59.I think, before some of your viewers were even born! It is interesting
:12:00. > :12:04.the way you talk about it. You talk about they will do this, they will
:12:05. > :12:09.do that, we were discussing that about how there is very little
:12:10. > :12:15.uncertainty now given the way a lot of, although it is not over until
:12:16. > :12:21.they published it. I am saying they will it is what they have told me to
:12:22. > :12:25.tell you. The fed has said, here, December, is that OK with you? The
:12:26. > :12:29.Bank of England said next week? But you are referring to the hints and
:12:30. > :12:36.tips. It is more than that, it is more, it even more overt than that,
:12:37. > :12:41.you know, in the old days waiting the central bank would come with a
:12:42. > :12:45.decision and markets would flash, now we have like six, eight weeks to
:12:46. > :12:50.prepare ourself, so by the time it happens it is like a ship that
:12:51. > :12:54.passes in the night. You think the bulk of the moves happens before?
:12:55. > :13:00.Absolutely, if you look at the dollar, 2014 rose 25% before the fed
:13:01. > :13:07.raised rates, some two years later, this year we had the euro going from
:13:08. > :13:11.1.05 to 1.20 and we had sterling going from 1.25 to 1.32 because the
:13:12. > :13:18.Bank of England is going to raise rates. It is done. It is baiting the
:13:19. > :13:22.cake. You will go through The Papers with us later.
:13:23. > :13:25.Harnessing the power of the sun - we'll be speaking to a leader
:13:26. > :13:28.in renewable energy batteries to find out how they
:13:29. > :13:41.You're with Business Live from BBC News.
:13:42. > :13:49.Whitbread, the owner of Costa Coffee and Premier Inn,
:13:50. > :13:51.has announced pre-tax profits of ?316 million.
:13:52. > :13:53.However, the results at Costa were more disappointing,
:13:54. > :13:55.with the chain reporting a 10% fall in half-year profits
:13:56. > :13:57.to ?59 million, partly due to coffee imports
:13:58. > :14:05.Theo Leggett is in our business newsroom.
:14:06. > :14:14.How well placed are they then to weather this drop? Whitbread has a
:14:15. > :14:21.group seems to be doing remarkably well, its profits are up by about
:14:22. > :14:26.10% on an underlying operating basis its headline figure is up 26%. It is
:14:27. > :14:29.expanding rapidly. Look at the share price this morning. Down 5%. Now the
:14:30. > :14:35.reason for that is concerns about one of the two main divisions of
:14:36. > :14:39.this group, Costa Coffee the so we have Premier Inns doing very well.
:14:40. > :14:44.It is expanding rapidly, and does seem to be benefits from an increase
:14:45. > :14:51.in tourism due to the weakness in the value of the pound. Costa Coffee
:14:52. > :14:55.profits are down nearly 10%, more than that, on an underlying basis,
:14:56. > :15:00.to looking at what is happening in the existing outlet, stripping out
:15:01. > :15:04.the growth, underlying sales have only grown by 0. 6%. This is a
:15:05. > :15:08.coffee maker struggling to generate growth in its existing store, that
:15:09. > :15:12.maybe partly because consumers are moving towards more sophisticated
:15:13. > :15:16.products. On top of the fact imports are more expensive because of the
:15:17. > :15:21.weak pound, people aren't so keen on that product any more and maybe they
:15:22. > :15:24.are going elsewhere. As we see investors aren't that impressed.
:15:25. > :15:32.Tell me about the third wave of coffee. Costa said this today, this
:15:33. > :15:37.what is the UK is entering, the third wave of coffee. It sounds
:15:38. > :15:45.ominous. Yes, it means consumers have gone from drinking
:15:46. > :15:50.unsophisticated freeze-dried muck we had a year year ago to going for
:15:51. > :15:57.posher coffees and now they're moving into niche products and
:15:58. > :16:05.specialist summer coffees. Costa is moving into those things and it has
:16:06. > :16:13.new coffees. But other people are doing that better. Go and relax and
:16:14. > :16:23.have a cuppa. Or have a coffee. We are back in just a moment.
:16:24. > :16:26.You're watching Business live - our top story - there's tough talk
:16:27. > :16:29.on trade ahead of President Trump's trip to Beijing next week.
:16:30. > :16:38.Last year, world leaders signed a landmark agreement to keep global
:16:39. > :16:41.And with car-makers already making a transition
:16:42. > :16:43.to greener technologies - many companies are moving
:16:44. > :16:46.Globally, our ability to capture solar energy increased
:16:47. > :16:49.by 50% in 2016 alone, but some of this electricity can be
:16:50. > :16:56.One company hoping to change this is the renewable energy firm Sonnen.
:16:57. > :17:01.The business installs batteries in people's homes and it's claimed
:17:02. > :17:03.that the system can provide three-quarters of your
:17:04. > :17:15.Christopher Ostermann is Founder and CEO of Sonnen.
:17:16. > :17:24.Tell us how the system works. The system is storing solar power until
:17:25. > :17:30.the point in time when you need it. For example in the night. It can
:17:31. > :17:38.cover the energy need for an entire night and manage the energy in your
:17:39. > :17:45.house, meaning improving our consumption, by switching electric
:17:46. > :17:50.devices. You're northern Europe and it would be possible to be cynical
:17:51. > :17:59.and say there is not enough to keep my washing machine going at night.
:18:00. > :18:06.In northern Europe you have sun light and it is enough to power a
:18:07. > :18:22.house. How much do you need. An average is a four or five kilowatt
:18:23. > :18:26.teak. The storage and installation is around 10,000. That is a lot. A
:18:27. > :18:31.lot of people won't be able to afford that. The key for your
:18:32. > :18:36.business is getting developers to install these as standard? Yes as
:18:37. > :18:41.well. It is developers and individual home owners. And if you
:18:42. > :18:45.imagine that you save 75% of your electricity bill from day one and
:18:46. > :18:49.this system lasts 20 years you have a fairly well pay back. The real
:18:50. > :18:57.market for you must be in new build I imagine. That must be where you
:18:58. > :19:02.can... Organise it so with the developers to get all the roofs
:19:03. > :19:07.facing in the right direction and the infrastructure in place, how
:19:08. > :19:13.much of your stuff is new build or is it retro fitting? 80% of the
:19:14. > :19:21.business is newly installed installations, not necessarily on
:19:22. > :19:31.new homes. New homes is maybe 50% of the business. What you need is
:19:32. > :19:37.regulator tos or s to say we are going to build revery new house with
:19:38. > :19:43.this. Yes this is happening around the world, people understand cleaner
:19:44. > :19:46.energy is a main issue. Where is it happening and where is not
:19:47. > :19:50.happening. Needless to say in the United States it is not happening
:19:51. > :19:57.for several reasons, but it is happening all over the world. The
:19:58. > :20:03.energy market it getting decentralised and this is supporting
:20:04. > :20:13.what we do. We solve the problem of renewable energy. You never know
:20:14. > :20:19.when the sun is shining and storage over comes this problem. How big are
:20:20. > :20:24.these things. Is it the size of a boiler. No it is like the shelf for
:20:25. > :20:30.shoes. It is 60 centimetres wide. That gives you enough power from the
:20:31. > :20:38.time the sun goes down until it comes up Yes. You don't use use your
:20:39. > :20:42.own battery. How does that work. We are sourcing battery sales from
:20:43. > :20:47.different suppliers, high quality sales that last 20 years and we are
:20:48. > :20:55.building the rest around that and the main part of what we are doing
:20:56. > :20:59.is the software part. It is do with what you call communities of
:21:00. > :21:05.batteries. Yes we invented this community and this means that we
:21:06. > :21:10.interconnect thousands of residential systems into a virtual
:21:11. > :21:18.power plant and what this does is supply customers from grid powers
:21:19. > :21:23.from other users, and secondly it supports the grid, by giving balance
:21:24. > :21:30.to the grid. Do I have to be close to the other users? No, you can use
:21:31. > :21:35.the public grid, you're paying a fee for that. We are using obviously the
:21:36. > :21:39.asset of the grid. But we can use the grid. So it is a national
:21:40. > :21:41.concept and no matter where you live you can be part of the community.
:21:42. > :21:47.Thank you very much. In a moment we'll take a look
:21:48. > :21:51.through the Business Pages but first here's a quick reminder of how
:21:52. > :21:59.to get in touch with us. The business live page is where you
:22:00. > :22:03.can stay ahead with the day's breaking business news. We have
:22:04. > :22:07.insight and analysis from the BBC's team of editors around the world.
:22:08. > :22:18.And we want to hear from you too. Get involved on the BBC business
:22:19. > :22:25.live web page. And we are on Twitter and Facebook.
:22:26. > :22:30.David is back to look through the papers.
:22:31. > :22:38.We will start with the story in the Hill, the political web-site based
:22:39. > :22:43.in Washington, the president very close to picking the next chair of
:22:44. > :22:49.the Federal Reserve? Yes the story is he wants to pick it before he
:22:50. > :22:54.goes on his tour of Asia. There is a lot of speculation. But the
:22:55. > :22:58.institutional framework of the Federal Reserve bank of America is
:22:59. > :23:03.bigger than any individual. So I'm not particularly worked. You don't
:23:04. > :23:08.think it will make a difference? No, people are speculating and traders
:23:09. > :23:13.love this kind of thing, when you have an esteemed institution, if I
:23:14. > :23:23.was to ask the difference between Eddie George and her Mervyn King and
:23:24. > :23:28.Carney, you would say you can't pick them out. It is an institutional
:23:29. > :23:33.framework. But of course I'm intrigued. There is a difference
:23:34. > :23:39.between the hawks and doves. I know he is the chairman and he has to go
:23:40. > :23:46.with the committee, but he still has a lot of weight. Yes, but to be
:23:47. > :23:51.honest once these people get in the job, it is job that makes them or
:23:52. > :23:55.they make the job. When you have a powerful institution it difficult to
:23:56. > :23:58.come and chop and change it. They will make a difference on the
:23:59. > :24:03.margin, but I'm not particularly worried over the next five years
:24:04. > :24:11.that whoever he picks will be a massive change in policy. Now back
:24:12. > :24:15.closer to the UK and in some respects people wouldn't see this as
:24:16. > :24:20.important, but it is a car dealer which has a profit warning. There is
:24:21. > :24:27.more to that about what is going on in cars and car finance. It is not
:24:28. > :24:31.just cars, people are worried about the credit growth in the United
:24:32. > :24:35.Kingdom and people earn money from financing deals and we are worried
:24:36. > :24:41.about consumption, but the Bank of England is talking of raising rates.
:24:42. > :24:48.And we think they will raise rates again in March. So we have discord.
:24:49. > :24:52.Because car sales are not doing well and consumers are struggling and the
:24:53. > :24:58.Bank of England say we want to raise rates. We have been asking for
:24:59. > :25:04.tweets on this, whether you would buy a car. Darren said buying a new
:25:05. > :25:09.car is like chucking a third of the money in the river. Always buy
:25:10. > :25:16.second hand. He says if I could afford it, yes. Helen said always
:25:17. > :25:23.buy a three-year-old vehicle. It might be difficult for everyone to
:25:24. > :25:31.buy second hand cars. You can buy them too old and you have to pay
:25:32. > :25:37.higher taxes to drive into London. But making the air cleaner for us
:25:38. > :25:42.all. That is one argument not to buy a second hand vehicle. Or you can
:25:43. > :25:47.buy no vehicle. I gave my car away. Maybe for the sake of the economy
:25:48. > :25:52.you should buy a car. I don't know how devoted to the economy you have
:25:53. > :25:54.to be to do that. Thank you very much.
:25:55. > :26:01.There will be more business news throughout the day on the BBC Live
:26:02. > :26:03.webpage and on World Business Report.