24/10/2017 BBC Business Live

This is Business Live from BBC News with Ben Bland and Jamie Robertson.

The White House says President Trump will talk tough on trade with China

when he visits Asia next week, we look at what's at stake.

As China's Party Congress draws to a close -

Washington says it plans to tackle Beijing's "predatory

Also in the programme - the United States is imposing

limited measures against Myanmar in response to the treatment

This is how the markets are doing. Not much movement in London and

Not much movement in London and Frankfurt.

A bright idea in renewables - one of the leaders in

storing solar energy - Sonnen - will be here to discuss

taking on rivals Tesla and setting up projects in hurricane-hit areas.

And as a car finance firm issues a profit warning

because of falling new car sales - we want to know -

Would you boy a new car not a used one, especially not from Jamie.

Today marks the last day of the five-yearly Congress

in China, which has confirmed Xi Jinping a second

Xi will even have his name inscribed in the party's constitution,

placing him alongside Mao in the Chinese pantheon.

But as Xi consolidates his power, America is ramping up the pressure.

On Monday, the White House said that on his forthcoming

trip to Asia next week President Trump will press China

to cease what the White House calls its "predatory trade practices".

And he will do that by addressing the "problem

So far this year, the US has imported goods worth over

$319 billion from China, but only exported $80 billion worth.

But here's the question - will China be in any mood to listen?

We're joined by Sarah Fowler, International Economist,

Sarah, what is America trying to get, what is it trying to do? So,

Trumps team has this impression that the goods deficit has caused a lot

of job losses in the US manufacturing, research over the

last 20 years since China ranked up its trading shows technology is much

more the cause than trade. So Trump's narrow focus is on narrowing

this goods manufacturing deficit with China, but actually the

services surplus, the US runs quite a bit services surplus which has

risen very fast over the last decade. Is he not ignoring the

services? He is. It, the services surplus is much smaller than the

goods deficit, which is why it is perhaps not noticed so much. Is it

growing quite fast? Yes, the way the Chinese economy is rebalancing, the

services sector in China is growing faster than the goods manufacturing.

So how do you think, how, what does China feel about this? China

obviously, in terms of its service sector, wants to see it developed,

does it feel kit do that still with an open services trade with the US?

Yes. Services trade is absolutely crucial to China as it rebalances

its economy, so earlier in year, the US started an investigation, a probe

into China's intellectual property because what has happened US tech

firms have struggled to make progress in the Chinese market. So

Donald Trump may be perhaps looking for a legislative win before the

midterm elections, because policy progress has been somewhat slow, and

so on the intellectual property side China could make some modest

concessions. The elephant in the room is going to be North Korea, how

does the North Korean situation play into trade relationships between the

US and China? Well, so, I think they both effectively want the status quo

with North Korea, for the US, imposing more sanctions, would hurt

its own economy because North Korea trades with about 80 country, the

Treasury, the US Treasury has the power to impose sanctions on any

multiculturals or banks that do business in North Korea, but that of

course would hurt the US economy as much as every other economy. From

the North Korean perspective, while more sanctions would hurt their

living standards, the elites could protect from that, and quell any

social unrest in the population, buzz for North Korea, it would

eventually raise the cost and the risk of the more nuclear

development, so the US is likely to keep that threat there and stop

them. OK, thank you very much. Let's take a look at some of

the other stories making the news. Google's new flagship smartphones,

the Pixel 2 and Pixel 2 XL, have received complaints

about the quality of the screen. Tech reviewers, who have had

the device for about two weeks, noticed "burn in" on the display,

while others noted "muddy" Google said it was investigating

the issue, which it A court in New York has found

a former HSBC trader guilty of defrauding a British energy

company in a $3.5 billion US prosecutors accused Mark Johnson

of exploiting confidential Investors have been selling off

shares of toymaker Hasbro. Its stock price tumbled by 10%

after the firm warned that Toys'R'Us The fall came despite

better-than-expected earnings. Hasbro saw quarterly profits rise

to 266 million dollars due to strong sales of its Transformers

and My Little Pony franchises. The United States has announced

limited measures against Myanmar in response to the treatment

of its Rohingya Muslim minority. It is considering targeted economic

sanctions against certain individuals it believes

responsible for the violence. First, Karishma Vaswani

is in Singapore. What kind of sanctions are these

they are thinking of bringing in? Jamie, the sort of first indications

we are seeing or early indications of how seriously the US State

Department is taking this issue, it says it is gravely concerned with it

and added in the statement from the State Department its imperative that

individuals or any entities responsible for the atrocities in

the state should be held accountable. The US decided won't

allow any Burmese officers is to participate in US assistance

programmes, that means it is cutting off military assistance to them, but

with regards to economic sanctions, the things they are considering

against targeted individuals associated with the violence would

allow for visa bans and asset freezes of this individuals, so

serious considerations with regards to sanctions in Myanmar. OK. Many

thanks indeed. And the markets. We don't talk about

the New Zealand dollar very much, with the incoming Labour Government

coming in it could prove negative for the New Zealand dollar. Let us

look at Europe. Not a huge amount of movement. Some political tensions,

of course the rumblings continue in Catalonia, the issue of whether they

want to break away from Spain, and also the far right party AFD taking

their seats in the German Bundestag later today. The other thing

investors are watching is the meeting of the European Central Bank

which happens this week and the Bank of England and what they might do on

interest rate, that meeting is happening next week. First let us

take a look at what is happening on Wall Street.

Several companies will be reporting earnings on Tuesday.

The recovery in the construction city will help Caterpillar's profit

The heavy machinery manufacturer which has been battered

in the last few years by a slurp slump in oil and commodity prices,

as well as weakness in China, but is seeing a rise in construction

equipment sales in China specifically, because of increased

It has been trying new menu items to try and

Things like fresh beef quarter pounders and

But it seems that its $1 drinks drove up traffic.

And while we are talking about fast food,

we should talk about Chipotle, which has also reported a rise

The chain has been trying to recover from a few food safety lapses.

Most recently one restaurant had to close because of an outbreak

David Bloom, Global Head of FX Strategy at HSBC joins me now.

Street. Receive We were talking before we came on the programme,

about why people aren't concerned is about politics, they, the thing that

is concerning markets is the central banks and round the world and what

they will be doing, can you take us through that is the The financial

crisis in 20062007 and wait for the first-rate rise in 2015, and they

have been raising rate bus the next wave has started. We saw the

Canadians couple of months ago do their first hike, this week we are

look for the ECB to reign back and next week the Bank of England is

going to drop the clanger by raising rates in the UK for the first time,

I think, before some of your viewers were even born! It is interesting

the way you talk about it. You talk about they will do this, they will

do that, we were discussing that about how there is very little

uncertainty now given the way a lot of, although it is not over until

they published it. I am saying they will it is what they have told me to

tell you. The fed has said, here, December, is that OK with you? The

Bank of England said next week? But you are referring to the hints and

tips. It is more than that, it is more, it even more overt than that,

you know, in the old days waiting the central bank would come with a

decision and markets would flash, now we have like six, eight weeks to

prepare ourself, so by the time it happens it is like a ship that

passes in the night. You think the bulk of the moves happens before?

Absolutely, if you look at the dollar, 2014 rose 25% before the fed

raised rates, some two years later, this year we had the euro going from

1.05 to 1.20 and we had sterling going from 1.25 to 1.32 because the

Bank of England is going to raise rates. It is done. It is baiting the

cake. You will go through The Papers with us later.

Harnessing the power of the sun - we'll be speaking to a leader

in renewable energy batteries to find out how they

You're with Business Live from BBC News.

Whitbread, the owner of Costa Coffee and Premier Inn,

has announced pre-tax profits of ?316 million.

However, the results at Costa were more disappointing,

with the chain reporting a 10% fall in half-year profits

to ?59 million, partly due to coffee imports

Theo Leggett is in our business newsroom.

How well placed are they then to weather this drop? Whitbread has a

group seems to be doing remarkably well, its profits are up by about

10% on an underlying operating basis its headline figure is up 26%. It is

expanding rapidly. Look at the share price this morning. Down 5%. Now the

reason for that is concerns about one of the two main divisions of

this group, Costa Coffee the so we have Premier Inns doing very well.

It is expanding rapidly, and does seem to be benefits from an increase

in tourism due to the weakness in the value of the pound. Costa Coffee

profits are down nearly 10%, more than that, on an underlying basis,

to looking at what is happening in the existing outlet, stripping out

the growth, underlying sales have only grown by 0. 6%. This is a

coffee maker struggling to generate growth in its existing store, that

maybe partly because consumers are moving towards more sophisticated

products. On top of the fact imports are more expensive because of the

weak pound, people aren't so keen on that product any more and maybe they

are going elsewhere. As we see investors aren't that impressed.

Tell me about the third wave of coffee. Costa said this today, this

what is the UK is entering, the third wave of coffee. It sounds

ominous. Yes, it means consumers have gone from drinking

unsophisticated freeze-dried muck we had a year year ago to going for

posher coffees and now they're moving into niche products and

specialist summer coffees. Costa is moving into those things and it has

new coffees. But other people are doing that better. Go and relax and

have a cuppa. Or have a coffee. We are back in just a moment.

You're watching Business live - our top story - there's tough talk

on trade ahead of President Trump's trip to Beijing next week.

Last year, world leaders signed a landmark agreement to keep global

And with car-makers already making a transition

to greener technologies - many companies are moving

Globally, our ability to capture solar energy increased

by 50% in 2016 alone, but some of this electricity can be

One company hoping to change this is the renewable energy firm Sonnen.

The business installs batteries in people's homes and it's claimed

that the system can provide three-quarters of your

Christopher Ostermann is Founder and CEO of Sonnen.

Tell us how the system works. The system is storing solar power until

the point in time when you need it. For example in the night. It can

cover the energy need for an entire night and manage the energy in your

house, meaning improving our consumption, by switching electric

devices. You're northern Europe and it would be possible to be cynical

and say there is not enough to keep my washing machine going at night.

In northern Europe you have sun light and it is enough to power a

house. How much do you need. An average is a four or five kilowatt

teak. The storage and installation is around 10,000. That is a lot. A

lot of people won't be able to afford that. The key for your

business is getting developers to install these as standard? Yes as

well. It is developers and individual home owners. And if you

imagine that you save 75% of your electricity bill from day one and

this system lasts 20 years you have a fairly well pay back. The real

market for you must be in new build I imagine. That must be where you

can... Organise it so with the developers to get all the roofs

facing in the right direction and the infrastructure in place, how

much of your stuff is new build or is it retro fitting? 80% of the

business is newly installed installations, not necessarily on

new homes. New homes is maybe 50% of the business. What you need is

regulator tos or s to say we are going to build revery new house with

this. Yes this is happening around the world, people understand cleaner

energy is a main issue. Where is it happening and where is not

happening. Needless to say in the United States it is not happening

for several reasons, but it is happening all over the world. The

energy market it getting decentralised and this is supporting

what we do. We solve the problem of renewable energy. You never know

when the sun is shining and storage over comes this problem. How big are

these things. Is it the size of a boiler. No it is like the shelf for

shoes. It is 60 centimetres wide. That gives you enough power from the

time the sun goes down until it comes up Yes. You don't use use your

own battery. How does that work. We are sourcing battery sales from

different suppliers, high quality sales that last 20 years and we are

building the rest around that and the main part of what we are doing

is the software part. It is do with what you call communities of

batteries. Yes we invented this community and this means that we

interconnect thousands of residential systems into a virtual

power plant and what this does is supply customers from grid powers

from other users, and secondly it supports the grid, by giving balance

to the grid. Do I have to be close to the other users? No, you can use

the public grid, you're paying a fee for that. We are using obviously the

asset of the grid. But we can use the grid. So it is a national

concept and no matter where you live you can be part of the community.

Thank you very much. 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 day's breaking business news. We have

insight and analysis from the BBC's team of editors around the world.

And we want to hear from you too. Get involved on the BBC business

live web page. And we are on Twitter and Facebook.

David is back to look through the papers.

We will start with the story in the Hill, the political web-site based

in Washington, the president very close to picking the next chair of

the Federal Reserve? Yes the story is he wants to pick it before he

goes on his tour of Asia. There is a lot of speculation. But the

institutional framework of the Federal Reserve bank of America is

bigger than any individual. So I'm not particularly worked. You don't

think it will make a difference? No, people are speculating and traders

love this kind of thing, when you have an esteemed institution, if I

was to ask the difference between Eddie George and her Mervyn King and

Carney, you would say you can't pick them out. It is an institutional

framework. But of course I'm intrigued. There is a difference

between the hawks and doves. I know he is the chairman and he has to go

with the committee, but he still has a lot of weight. Yes, but to be

honest once these people get in the job, it is job that makes them or

they make the job. When you have a powerful institution it difficult to

come and chop and change it. They will make a difference on the

margin, but I'm not particularly worried over the next five years

that whoever he picks will be a massive change in policy. Now back

closer to the UK and in some respects people wouldn't see this as

important, but it is a car dealer which has a profit warning. There is

more to that about what is going on in cars and car finance. It is not

just cars, people are worried about the credit growth in the United

Kingdom and people earn money from financing deals and we are worried

about consumption, but the Bank of England is talking of raising rates.

And we think they will raise rates again in March. So we have discord.

Because car sales are not doing well and consumers are struggling and the

Bank of England say we want to raise rates. We have been asking for

tweets on this, whether you would buy a car. Darren said buying a new

car is like chucking a third of the money in the river. Always buy

second hand. He says if I could afford it, yes. Helen said always

buy a three-year-old vehicle. It might be difficult for everyone to

buy second hand cars. You can buy them too old and you have to pay

higher taxes to drive into London. But making the air cleaner for us

all. That is one argument not to buy a second hand vehicle. Or you can

buy no vehicle. I gave my car away. Maybe for the sake of the economy

you should buy a car. I don't know how devoted to the economy you have

to be to do that. Thank you very much.

There will be more business news throughout the day on the BBC Live

webpage and on World Business Report.