23/11/2017 BBC Business Live

This is Business Live from BBC News

with Sally Bundock and Ben Thompson.

A number of uses on the table as we

assess Switzerland and the EU

squaring up over cash.

Very warm welcome to the programme.

We are at the mercy of the robots

today with a few glitches! Will talk

you through what's coming up on

Business Live. In Switzerland

Jean-Claude Juncker will be holding

talks with the government, that's

coming up. Also as well in the

programme, more Japanese companies

seem to be accused of cheating. This

time Mitsubishi Materials is in the

limelight for the wrong reasons. And

for the markets today it will be

quieter with it being the

Thanksgiving holiday break in the

USA. Yet Europe is open and training

and as you can see the markets are

all headed south. And we meet the

man who revived an iconic brand, the

Royal Enfield motorbike, as it

returns to the UK for the first time

since

the 1950s. We will find out what has

driven that decision. And as holiday

shopping season begins is your

budget squeezed, are you planning on

spending more or less or just

cutting back on Christmas. Let us

no, using our hashtag, #bizlive. A

very warm welcome to the programme.

We live, this is Business Live. I

think we have our technical problems

sorted now so let's begin in

Switzerland. European Commission

President Jean-Claude Juncker will

be holding talks very soon with the

government. About trying to get the

strained EU - Swiss relations back

on track. The talks are being

closely watched in the UK not least

because Switzerland is held up by

some as a model for post-Brexit

Britain. Not in the EU yet enjoying

close trade ties all the same. When

it comes to the issues, the big ones

are very familiar. Money. That's one

of the key issues. The Swiss are due

to pay another 1 billion francs,

that's around 1 billion US dollars

to the EU's cohesion fund. That

supports newer members in Central

and Eastern Europe. It is a sticking

point. Another familiar one. This

issue has been on hold since

February 20 14th when this was

narrowly voted, in a referendum, to

bring back quarters for the number

of EU workers that they let in. --

quotas. Some see this as a test case

for Brexit. That can Switzerland get

the benefits of trade with the EU,

that is, access to the single

market, while still controlling its

borders? Many people see it that way

although not Jean-Claude Juncker. He

calls it a Swiss specific situation.

He said last year any deal reached

with Switzerland would not be a

blueprint for the UK. Ben, overdue.

Thank you. Let's speak to image and

folks who joins us from Burma.

Imogen we heard this would not be a

blueprint for the UK but there are

similarities.

Yes, but some

differences as well. We know that

this was narrowly voted to introduce

quotas on EU migrants in 2014. After

that the EU put Switzerland's

bilateral deals, very important to

the Swiss economy, on hold. Since

then the Swiss have found a

compromise, which would mean

introducing quotas only in certain

sectors and only if unemployment

reaches levels that it has not

reached in Switzerland for decades.

So Switzerland 's commitment to free

movement of people remains

unchanged. That is something that

voters in Britain who wanted Brexit.

Want any more. So there's the

difference. In terms of payment, in

2006, this was, in a referendum,

voted in favour of 1 billion francs,

$1 billion, to the EU, what was then

the enlargement fund. Now it is the

cohesion fund. And it looks as if

this was government is ready to pay

up again to preserve what it sees as

the most crucial thing for

Switzerland and that is the trade.

More than half its exports go to the

EU. It can't have tariffs. And once

the single market. It doesn't want

WTO rules. So differences with

Britain -- it wants the single

market.

What is interesting Imogen

is that very concept, if you want

some of the nice things like a

free-trade area or a customs union

and you want to do business with us

you will have to pay a bit, that's

what the Swiss have found.

Yes,

there is a price tag attached.

Switzerland contributes to many EU

programmes. It wants access to

things like scientific research,

creative Europe, which is coming, it

wants access to all those things and

it knows it will have to contribute.

It thinks it gets more out in terms

of its good trade deals with the EU

yet there are sticking points. The

right wing party which proposed the

quotas are used this donation of 1

billion francs to the new EU states

is blackmail. There will be problems

getting it, but ducks as of this was

government will promise it to

Jean-Claude Junker today.

Interesting times, thank you, Imogen

in Burma. No other stories making

the news.

Foxconn, a main supplier for Apple's

iPhone, says it has now stopped

interns from working illegal

overtime at its factory in China.

It comes after a Financial Times

report found at least six students

worked 11-hour days at its iPhone

Ten plant in Henan province.

The US Federal Reserve looks

set to raise interest

rates again next month.

Minutes of its last meeting showed

a majority of committee members

saw the need for a rise

in the "near term".

That's despite concerns

about the weak level of inflation

which has been below the Fed's 2%

target for years.

The taxi app Uber is now facing

investigations in Italy,

the Netherlands and in the UK.

Uber failed to disclose

a hacking attack last year

where personal data from 57 million

customers and drivers was stolen -

and that it had then

paid-off the hackers.

The UK regulator has

said that the incident

raises 'huge concerns".

Now to Asia, there could be more

damage to the reputation of Asian

manufacturing after one company was

found to have been falsifying

quality data figures.

Today, reports say a division

of Mitsubishi Materials has also

been caught cheating.

Leisha Santorelli is following

the story in Singapore....

Leisha, an interesting one because

just after that scandal, potentially

Mitsubishi involved in something

similar.

Exactly Ben. That made in

Japan label seems to be losing even

more of a shine because of this

scandal. This comes from another

famous Japanese name, Mitsubishi,

and according to a report by Japan's

financial daily, a division of the

company called Mitsubishi Cable

Industries has been falsifying

product data for centuries. The

product is plastic seals used by

hundreds of companies in the

aircraft, aerospace and nuclear

sectors. It is no joke. Mitsubishi

has launched an investigation that

no safety issues have been reported

yet. Yet after that quality scandal

at the steel company as well as with

Subaru, which allowed and qualified

inspectors to sign off on their

vehicles, it looks like there's a

lot of soul-searching going on in

Japan as to how they can allow such

lapses to happen among their ranks.

Thank you so much Leisha. We will

keep an eye on that situation as it

develops.

Let's look at the financial markets.

On the one hand and has been quiet

because Japan has a public holiday

today, it had such a stellar day the

day before and in the final hour of

trading dipped dramatically by

nearly one percentage, in China, it

saw quite a big fall in share

markets in Shanghai mainland China.

There is no clear reason why this

happened but the dollar has been

extremely weak, which is not good

news for many markets trading in

Asia. Again for example, you know

you know what that does. In Europe,

no action in Wall Street because of

the Thanksgiving break. They are all

headed lower, we will talk more

about the markets, it was Budget Day

and the UK on Wednesday.

The Chancellor

of the Exchequor has been speaking

to the BBC this morning -

again highlighting how Tory

plans will help young

people in particular.

It is about the future prospects of

Britain and the budget has been

designed to secure Britain's

prospects that the feature, to

assist the next generation, to help

them get on the housing ladder, give

them confidence that they will be

the high skilled high-paying jobs

available for them so they can

prosper in the future and we can

pass on an economy and a nation in

good shape to the next generation.

That was the Chancellor, Philip

Hammond, talking about the details

in his budget yesterday.

Mike Amey is managing director

and portfolio manager at PIMCO.

What did you make of the budget,

some giveaways but some debit

assessments.

Yes, one was an

admission that growth will be slower

than we helped...

Slower than anyone

helped including the Bank of

England!

The Bank of England has

some revisions to do as well, you

would've expected ten or 15 years

ago two and a half would have been a

normal number. On the other hand the

Chancellor is spending some money so

there's a bit of an increase in

spending relative to where we were,

that is what he was alluding to in

that clip about freeing up some of

the purse strings for spending.

Housing was a focus as well

certainly for first-time buyers. In

all of this, until we start building

more houses, nothing will really

change with the housing market.

The

key underlying problem there is if

you don't burden of houses relative

to demand you put pressure on

prices. That's the fundamental

problem. The change is how you

unlock that spending. The government

can make it easier for planning or

they can force home builders one

they've got these so-called land

banks to build housing. They are

trying to build a bit more on

encouragement rather than the

physical spending.

Let's talk about

the United States, the Federal

reserve minutes were released, they

tell us nothing we don't anticipate

for December, that is, a rate rise.

Quite concerned about the lack of

inflation in the US. A problem we

modern experiencing here.

This will

be the fifth time that the US has

raised interest rates. To one point

4%. They have the opposite problem

to us. They have slightly higher

growth, 2% as opposed to our one and

a half but they have low inflation,

and their target is two, the same as

ours. They are approaching it

differently. Raising rates because

they can. The Bank of England is

worried about inflation staying

higher so it's a different dynamic.

The underlying message of this is

that we are getting to the point

where globally interest rates can

come of the lowest levels they have

been.

Mike, for the moment, thank

you, we'll talk about some of the

stories in the papers later and the

cost of Christmas, many of you

getting in touch about whether you

are cutting back on spending for

Christmas, we will go through what

you say. Keep your messages coming.

Still to come...

A revved up homecoming -

after a revival in India,

we meet the man bringing this iconic

bike back to Britain.

You are with Business Live from BBC

News.

Let's talk some more about the

budget.

So as the dust settles

on the autumn Budget unveiled

by the Chancellor yesterday,

what are the key points?

It depends how you die just it. Who

will benefit? We saw some of the key

points -- it depends how you die

just it.

Well, there's the help

for first time buyers,

a big homebuilding programme

and extra spending

on the National Health Service.

But, the independent

forecasting body, the Office

for Budget Responsibility,

says the economy is slowing -

with growth of just 1.5% this year.

That's behind most other major

economies and is making it harder

to cut our national debt.

Richard Jeffrey is Chief Economist

at Cazenove Capital Management.

Nice to see you, Richard.

Good

morning.

What did you make of it?

It

was uninteresting budget. The

Chancellor didn't have much room to

manoeuvre but used the room that he

did have reasonably well. Most of

the attention was grabbed by this

downwards revision to the forecast

for growth and behind productivity.

A lot of evidence suggests that

growth in the economy at the moment

is being and recorded, and that

although not spectacular

productivity is slightly better than

the currently published numbers

suggest. Ironically, this might set

the Chancellor, because I think

growth would be a bit stronger than

the 1.5% that is being projected on

average for the next few years. It

might be one and the quarters, or

even 2%. If that's the case he will

have more room to manoeuvre in

future budgets than people currently

reckon. As I say, there is some

reason to suppose this. If we look

at Labour market data suggesting the

economy is much stronger than the

output numbers are suggesting.

Richard, good to top you. Thank you

for so much for explaining all of

that.

There is lots more on the BBC News

business live website, including a

calculator. And there is also a

story about Christmas fraud,

smartphones and clothing, read all

the detail, keep informed.

You're watching Business Live -

our top story - Switzerland

and the EU square up over cash

and immigration - as the UK looks

on for signs of what might be

to come in a future post-Brexit

relationship with

the European Union.

The UK will be watching with great

interest. We have been discussing

with our correspondence that in many

ways its payment for access to the

Common Market, the European market

and clearly a lot of questions

continue over that funding.

Va va-v-rooom!

It's been more than a hundred years

since the Royal Enfield motorbike

first revved its engine.

First made in 1901 -

it lays claim to being one

of the world's oldest motorcycle

brands still in production.

During the first and second world

wars it supplied bikes

to the British forces.

In 1955 the company partnered

with Enfield India to manufacture

the motorbikes in the east

of the country.

Just over a decade later

the British firm went bankrupt.

But the name Royal Enfield has been

carried on by the India-based firm -

which now has plans to bring part

of the business back to the UK.

Siddhartha Lal is Chief

Executive of Royal Enfield.

He is with us now. Nice to see you

and welcome.

Thank you.

Let's talk about your involvement,

you've been doing this for quite a

file, you did this as a result of

your father's involvement.

Tell us about this.

Royal Enfield

has been through many potential

bankruptcies, it died once in the

UK, nearly twice in India, but it is

a resilient brand, finds its way

back into life and hopefully this

time it is for real. In the 90s, my

father bought this brand, it was a

link about to die, I was 18, I had

the scheming, lovely motor cycle, it

was obvious something really

interesting to me and I started

running the company in the year

2000, it was in a spot of trouble.

I

would imagine at the age of 18 it

was cool for dad to buy a water bike

company, James Dean and Steve

McQueen, famous users of it and

posing on them, but the bikes

weren't selling, the competition was

coming from Asia, extremely tough.

To sell bikes en masse, the markets

there, people want them, especially

in India.

What happened, as in the US, the UK,

Europe in the 60s, 70s, 80s, the

Japanese motorcycles came in they

were more efficient, cheaper, and

they were really good, they

destroyed the industry and the same

happened in India in the 80s, the

joint ventures came in, destroying

all the old-style motorcycle

companies including Royal Enfield

and it took us decades of not making

any money, not growing, the Indo

Japanese players were growing

tremendously and at that point we

found our resilience. We said we

don't want to be in a small

motorcycle market, we want to make

something delightful, fun and

leisurely and that's what you focus

on and we didn't grow for well over

a decade and in the year 2000 we had

a ramp and it's been growing ever

since.

Do you think your growth

story in India is how the Indian

economy has developed in the sense

that more people, they are more

aspirational, they have more money

because your motor bikes are more

expensive than some of the cheap

Asian models that they could easily

opt for to do their commute.

Absolutely, art motorcycle is nearly

double the price but what happens,

around the year 2010, and everything

started working, it was the time

when the IT revolution and the boom

happened in India, people were

earning a lot more, some young chap

at 21 or 23 was earning a hell of a

lot more and he wanted to express

his individuality and difference in

a different way and we expect to be

able to take that to markets outside

India and that is the future of

Royal Enfield.

Global company,

Manufacturing still in India, your

research and development done a lot

in the UK, widespread that?

We set

up a UK technical Centre, the team

we started holding a number of years

ago, that's got around 125 engineers

and it's growing. Over the last

decade when we could not afford so

many engineers we came to the UK,

the Midlands, that is where we found

the people who could resonate with

what we were trying to accomplish,

we came here for consultancy but now

we can afford more we decided to set

up our own bespoke centre and

dedicated team and these are people

who really understand leisure motor

cycling. In India we understand

engineering and manufacturing but

the leisure side of motor cycling is

what we are trying to get out of the

team.

How are you going to grab the

market in the UK and elsewhere

outside India in a significant way

because some see it as a very niche,

kind of like a Rikard Karlberg, cool

bike, not necessarily a bike we will

see on the streets, alongside all

those Japanese manufacturers?

That's

what we are in markets like the UK,

other such markets, we were a bit

more obscure, different, right?

Maybe integer placement but what's

happened as the result of our global

ambitions and the type of work we

do, our brand is still unique and

different and we have this all

school character and I believe a

vintage style looking but with a

modern under ten. And a green one as

well? Will... More than green...

It's very fuel-efficient, compared

to other motorcycles and what's

happening, we have a new range that

we will bring into markets in the

UK, they've been designed right

here.

We will have to leave it

there, we are running out of time

but so good to see you. Thank you

for being on the programme. This is

how to stay in touch. We will keep

you up-to-date with the latest

details, insight and analysis on the

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you. Get involved on the web page.

On Twitter and you can find us on

Facebook. Business live on TV and

online, whenever you need to know.

Mike is back in the studio, lots to

talk about, Black Friday tomorrow,

Thanksgiving today, get out and

spend but many are feeling the

pinch.

Absolutely, two things going

on, Black Friday, historically

retailers go into profit for the

year. The challenge is retailers are

under a lot of pressure and you

certainly see that in the UK.

Further our continual pressure is on

the high street and the split

between Street and the Internet is

the key challenge, making the

transition obviously the one we look

for.

So many retailers doing both,

in tandem and there was a big swing

over the last decade that everything

would go online and we like the

convenience of ordering online and

picking it up at the shop.

If you

are a large retailer you need to

have a presence, people can

physically see the items that you

have to make sure they buy it off

you without going to another

website, that is the challenge for a

lot of retailers.

Are you guilty of

going into a store, you touch it you

feel it, then you go and buy it

elsewhere?

I am not a very good

shopper.

You are probably saving a

lot of money. Let's look at what you

are doing, Stewart says I am cutting

back significantly I cannot afford

it. Sorry to hear that. Anna says

Christmas sucks, I will spend as I

normally do, not feel pressured. I

want to know how Erica does her

budgeting, Lincolnshire, 350 quid

she limited her spending two, hoping

to beat it this year. Well done with

that. Mike, the other story

dominating, Uber, huge hacking

attack, paying off the hackers.

Uber

has been in the news a lot recently,

this is the latest story, do people

stop using the service, is this

enough to tip it over the edge, so

far it does not look like it but the

bad news is stacking up.

Thank you.

So nice to see you. Thank you so

much for your company. We will see

you same time same place tomorrow.

Have a great day. Goodbye.