07/12/2017 BBC Business Live

This is Business Live from BBC News

with Jamie Robertson

and Sally Bundock.

Banking regulation -

will Europe's new financial rules

prevent another crisis or just

choke off investment?

Live from London, that's our top

story on Thursday, 7th December.

It's ten years since the financial

crisis, but up until now,

there's been no agreement

across Europe on how

to stop it happening again.

That could change at a meeting

in Frankfurt later.

We will tell you all you need to

know.

We will tell you all you need to

know.

Also in the programme...

Sins of emission -

a VW executive is jailed for seven

years in the US for his role

in the Dieselgate scandal And we'll

be looking at the challenges facing

agriculture this century.

Markets are recovering from

Wednesday's decline. We will talk

you through the winners and losers.

And we will be looking at challenges

facing agriculture this century.

Could the sea and seaweed provide a

potential solution? As the world's

biggest Starbucks opens in Shanghai,

do you think we have got enough

coffee shops?

Just use the hashtag BBCBizLive.

Hello and welcome to Business Live.

We will be tasting seaweed bacon in

about 15 minutes. Stay with us for

that, if nothing else! Starting with

an anniversary I'm sure you

remember.

It's ten years since

the financial crisis -

but still no pan-European agreement

on how to stop it happening again.

In Frankfurt today that

could all change - we will tell

you all you need to know.

Central bank chiefs are expected

to decide new rules -

on just how much cash banks have

to keep on hand for an emergency.

They are known as Basel 3

after the Swiss city -

but what are the key issues?

Until now, banks have been allowed

to decide for themselves how much

cash they need to stash away.

But under new rules,

there will be what they call

a standard approach

to assess the riskiness

of the mortgages, loans and debt

that each bank holds.

Basically, it will mean many

European banks will need to hold

more cash in reserve.

And the banks argue that means

less money to lend out

which could damage the economy

and it could make them

less competitive.

In the UK, rules have been tightened

up since the crisis,

with banks subjected

to annual stress tests.

Early last week, the Bank of England

said all UK banks passed the latest

tests.

Gonzalo Gasos, Head

of Banking Supervision

at the European Banking Federation.

The bottom line, is this going to

make European banks safer in the

financial crisis?

Of course, but let

me point out first that European

banks have already largely

accomplished the objectives set out

in 2010 by the group of central bank

governors and heads of supervision

of Basel three. What we are

discussing today are some

complimentary details. European

banks have three times more capital

than before the crisis and that

makes us more resilient and more

able to face adversity. That is the

most important piece of news today

and there will be some compliments

to finalise these very long ... From

all regions across the world, the

finalisation of the Basel three

package means the end of the crisis.

It sounds to me as though you are

saying, there is no dramatic change

today because the banks have been

working at this for five, six years

already. If there is not much of a

change, everything carries on just

the same as before, is that right?

Well, my point is that we have

already accumulated much more

capital and liquidity than we had in

the past. Now the new rules have

some details that will need to be

carefully assessed in a European

impact assessment that should be

rigorous enough to understand what

impact will be in certain portfolios

like residential mortgages, trade

finance, project finance.

Do you

think it will make banks less

willing or able to lend?

Well, that

depends on the final details of the

agreement. It will be published

later today. And how we have to

assess that impact in certain

portfolios. At the end of the day,

more capital beyond a certain level

only means a higher cost for banks

and therefore for borrowers who are

the citizens in our European Union.

Thank you very much indeed.

Let's take a look at some of

the other stories making the news.

One of Volkswagen's top

executives has been sentenced

to seven years in prison and fined

$400,000 for his role

in the Dieselgate scandal.

The judge described Oliver Schmidt

as a key conspirator in this scheme

to defraud the United States.

More on that story later. It is all

over the press.

Bitcoin has soared to a new record

high, above $14,000.

The virtual currency has surged

from below $1,000 at the beginning

of the year, despite questions

about its real value and worries

about a dangerous bubble.

Steinhoff International -

the owner of Poundland in the UK -

has seen its shares fall

by another 18% this Thursday.

They plunged by almost two thirds

on Wednesday after the South African

group announced a probe

into accounting irregularities.

Chief executive Markus Jooste has

resigned and the firm has

postponed its full-year results.

Let us have a look at the markets

now.

The International Monetary Fund has

raised the alarm about the high

level of debt in China,

saying it poses a risk

to financial stability.

That hasn't gone down

well in Beijing.

You might think we have heard this

before, the IMF behind the curve,

perhaps.

Let's go to our Asia

business hub where Leisha Santorelli

is following the story.

Quite often the IMF says things many

have been talking about for months.

That is correct but the IMF is not

crying wolf because the risks

China's economy faces from a build

up of debt in the financial sector

does risk triggering another crisis.

The IMF's report actually is another

comprehensive assessment of how

China's financial system has been

since 2011 and examining whether

China is doing enough to address all

of the debt. China has relied on

exports and investment to drive its

economy but many believe the growth

model has reached its limits and the

build up of debt is posing a big

risk. The IMF is arguing China has

to put financial stability above its

pursuit of high-growth or GDP

figures and it is recommending

Chinese banks increase their cash

cushion to protect against an

economic downturn.

Thank you. As far

as markets in Asia, not perturbed by

the news from the IMF whatsoever,

very strong session today. Japan as

well, up over 1%. A really good

session. This follows quite a bit

decline for Asian markets on

Wednesday. Wednesday marked the

eighth day in a row of declines for

Asian markets. There has been a

bounce back today, but behind me,

you can see the Dow down slightly.

You're right now... The markets have

been going for nearly 40 minutes --

the FTSE right now. GDC is

interested in buying Lord --

Ladbrokes Coral. We will talk more

about the movers and shakers.

And Samira Hussain has

the details about what's ahead

on Wall Street Today.

The US Federal reserve on Thursday

is likely to report extended credit

rose to 17.50 billion dollars in

October. In earnings news, discount

store dollar general will be

reporting. The company has been

cutting prices more aggressively as

it looks to try to better compete in

the grocery industry. Amazon's

purchase of Whole Foods is heating

up grocery wars. Companies like

Walmart are ramping up grocery

offerings to compete against the

online retailing giant. And we will

continue to watch lawmakers in

Washington try to get a spending

deal in place to avert a government

shutdown. Congress has until

midnight on Friday to come up with a

short-term spending bill. Without

any legislation in place, the

government will begin shutting down

on Saturday.

Interesting. Perhaps

another fiscal cliff. We remember

that!

Joining us is Maike Currie,

investment director

at Fidelity International.

You wanted to focus on the states,

quite a few issues, jobs report out,

all sorts.

Investors are keeping an

eye on the possibility of a

government shutdown, also Donald

Trump's tax reforms, and tomorrow,

the payrolls are out. Expectations

are jobs will be slightly more

muted. Quite a strong month last

month because the figures were much

better after the Hurricanes had

muted previous figures. This matters

because next week, Wednesday, the

Fed will give its announcement on

whether it will raise interest rates

and expectations are it will go

ahead with the rate rise of 0.25%.

It is interesting because the US has

led stock markets higher, it is

looking quite pricey, investors are

questioning how long it can

continue, but the US is home to the

stocks that are offering growth that

investors need in an era a very

paltry growth. Fundamental good

results coming out from these

companies, very good reporting

earlier, a month ago, so there is

justification for the prices. What

investors really want to do is

wrapped that arms around the gold

standard -- gold standard, in

technology, sustainable growth. The

tech companies are spending a lot,

but they are doing it to invest in

all sectors so they can continue

dominating.

Thank you very much. You

will return later to talk about some

of the other stories. We have more

to come. They say see food and eat

it. Seaweed diet! Do not say that

too quickly! Seashells. That is all

coming up on Business Live. She

sells seaweed...

I am very hungry right now.

The majority of businesses expect

the fall in sterling

to increase their costs.

A British Chambers of Commerce

survey of over 1,000 businesses

found that 63% of businesses

expect their costs to increase

in the next 12 months as a result

of the devaluation in sterling.

A quarter of businesses expect costs

to rise significantly.

In comparison, only 6% of firms

expect their costs to decrease.

Anastassia Beliakova

is the Head of Trade Policy

at the British Chambers of Commerce

and she joins us from the newsroom.

What I find odd is the timing. It

seems we have had the big increase

in inflation as a result of the

devaluation of the pound. That is

last year's story, yet you are

saying they are worried this will

keep on going?

What is striking

about the findings in the survey

with American Express is that

companies, despite the fact they

have been facing pressures from the

fall in sterling over the past year,

they have not been hedging against

currency risks. A number of things

they could do to protect themselves,

half of the firms almost we

surveyed, despite higher costs, they

have not hedged against currency

risks.

I am surprised to hear that.

This is because of lack of

information but also company is not

being proactive in terms of

protecting themselves. There are so

many things they could do, take out

insurance against currency risks,

sign forward contracts to lock in

the particular exchange rate, but

many are waiting and whilst they are

waiting, they are seeing costs rise.

They need to take action to protect

themselves.

Do you think the result

will be they will feed those costs

through into higher prices or reduce

staff levels or cutting costs, how

will they deal with it?

We're not

seeing at the moment this expressed

in higher prices. But a number of

companies are saying this is

something they are considering. This

is worrying of course and it also

highlights the importance of trying

to cut down costs before they are

passed onto consumers and before

they force companies to make quite

significant changes to how they are

run.

Thank you very much indeed.

More detail on that story on the

Business Live page including other

stories like house prices, the fifth

month of rising house prices

according to the Halifax.

You're watching Business

Live, our top story:

Central Bank bosses are expected

to decide new rules later today

at a meeting in Frankfurt.

Known as Basel 3, they would

require many European

banks to hold more cash in reserve.

It is designed to try to reduce the

likelihood of another financial

crisis. Some say it would mean there

would be less money to lend out and

it would damage the economy.

it would damage the economy.

A quick look at how

markets are faring.

They are all heading higher, in the

right direction, not a big jump. I

have got some bags here are my left.

We shall explain about that in a

moment.

We shall explain

about that in a moment.

Agriculture in the 21st century

faces many challenges as a growing

global population puts pressure

on water and land resources.

So with the number of people

on earth expected to hit 9 billion

by 2050, how can we produce enough

food to feed everyone?

Well, one man thinks

he has a solution.

Seaweed needs just sea

and sunlight to grow,

and according to Dutch entrepreneur

Willem Sodderland, it is the most

sustainable food on the planet.

In fact, it's becoming so popular,

that earlier this month the Marine

and Aquaculture stewardship councils

launched a certification scheme

for seaweed to set minimum

requirements for growing

and farming it.

After realising the health

and environmental benefits

of seaweed, Sodderland launched

Seamore in 2015, with a mission

to make seaweed an everyday food.

Joining us now is Willem Sodderland,

founder and CEO of Seamore.

He is here with his various samples.

And some place as well.

I know you are hungry.

I like that one. We have got seaweed

bacon and seaweed pasta. You could

if freshly for us this morning.

Absolutely.

Tell us how and why you

started this.

I was in a restaurant

and ordered a seaweed salad and I

got a plate and I could not find any

seaweed on it and it turned out the

tagliatelle on the plate was the

seaweed. That gave me the idea to

look into it to see if you could

swap carbohydrates for vegetables

which is something we were looking

into in my household.

What do you

think? I like that one. You used

crowdfunding? You'll yes, we did and

we tested the product with

consumers. How much did you raise?

We raised about 100,000 in the

beginning and then we raised more

from banks and also from former

investors.

How do you put it out

there to get all those people

interested? What do you say to them?

You start with a small group of

testers and you ask them to get it

out there. You bring the story to

the media and you create

storytelling basically. Then it is

picked up. Sorry, you ask a

question.

I know you are fascinated. Pass me

the bag of pasta. I could pass that

all the time, I have got three kids

and it is great. This takes awhile

to cook. How much is it? In terms of

price? That is a little bit over £5.

£5 for a bag of pasta, a bag of

seaweed. How do you overcome

people's perception of it?

It is one

of the reasons why we are presenting

it as a healthy good alternative

because people know what to expect

an do with it. Pasta and bacon. If

you give seaweed to people, they

have no clue where to start.

You are

selling it as a luxury item. You

will not solve the world's food

crisis with this.

We have to start

somewhere. With the wraps we are

introducing we are getting close to

normal price.

We must ask about the

sustainability of this. Many people

will be saying do we want the world

food crisis solved by people

harvesting the oceans. What about

the ecosystem of the oceans?

Obviously that is concerned. Firing

of seaweed in a shed space on a

large scale. That is why it is so

good that they came with standards

of harvestable farming. But we have

to get our food from somewhere and

we have more ocean than we have of

land and there is a compelling

reason to look to the ocean for

food.

The sea is closer. It is very

salty. That is sea salt obviously.

That is because it is a replacement

for bacon and bacon is salty and

that is why it makes sense.

We have

run out of time. Thank you for

coming in and cooking for us, we

appreciate it.

It is good. It is delicious. Seaweed

bacon butty with ketchup.

Seaweed bacon butty with ketchup.

The boss of global bank

Standard Chartered has been speaking

to our business editor Simon Jack.

He described contingency planning

for Brexit as "expensive,

complicated and inconvenient".

And he's concerned young people

from outside the UK are already

being put off a career in London.

We have already had some setbacks

for the talent pool in London

through the restrictions of student

visas, that is already a problem.

Some of the best talent that we can

have in the UK marketplace

are coming from students who have

chosen to study here and then stayed

for some extended period afterwards.

And you have noticed

that impact already?

We have noticed that impact already

more through a sense from non-UK

foreigners that this might not be

such a hospitable place any longer.

So it is more psychological

psychological than contractual as it

were, but it is something we might

be really careful about.

The UK has been successful largely

because it has been a welcoming

place for talent from any part

of the world.

I know when I listen

to the government spokespeople

they say that that will continue,

that is the intention,

unfortunately not all of the body

language and references

support the rhetoric.

That interview with the boss of

Standard Chartered is on our

website, so if you want to see it in

full, take a look. Maike Currie is

back as promised.

We have got to mention diesel gate.

One of the top executives in the US

behind bars.

And he has received the

maximum sentence of five years, so

it will be a deterrent. A few days

ago. Wogan reported it had hit its

targets three years ahead of

schedule. Two years on since the big

scandal it is on track and it is on

the offensive rather than the

defensive.

It has managed to say

that was then, this is now. There is

an emphasis also on electric cars.

They will have electric versions by

2025.

Absolutely, it has done a

fantastic job. It used this scandal

as a catalyst for change. There was

a lot of concern about brand image

at the time and they have emerged as

the winner.

Oliver Schmidt has been

put behind bars because of the

diesel scandal. Let's move on to the

scandal in Shanghai. This coffee

shop is huge. Do we need more coffee

shops? Tell us more about their

expansion.

We know China is a

country where T is the favourite

drink, but there is a lot of

interest and Starbucks is reporting

it is opening a new coffee shop

every 15 hours which is staggering.

It is moving into the emerging

world.

Starbucks expansion, there

seems to be no holding back right

now. We asked our viewers if they

think we need more coffee shops.

Jill says it is a shame they are not

combining with other shops.

Especially in villages and remote

locations.

We have too many bad ones

from calling themselves Artisan and

not many good ones. Are you a fan of

a coffee shop?

I am a huge fan of

coffee and coffee takeaways. The

coffee culture in the UK has

exploded and people are a lot more

discerning. They are not going to

big brand names, they are going to

independent coffee shops. Starbucks

in the UK is struggling because of

that, our consumption is changing.

It is more about the experience,

going for coffee and experiencing

something else.

One guy in the New

York Times says, once love has

begun, it never ends. He obviously

likes his coffee estimation mark

somebody says there are coffee shops

and there are coffee shops and there

are coffee flavoured frothy milk

shops. 280 calories. There are also

more coffee shops then you can shake

your beans that.

We have far too many bad ones from

calling themselves Artisan and they

are not very good ones. Starbucks

said they would have one on every

single corner.

That was the ambition. If Shanghai

is the way they are going, they are

not holding back.

I think the more

choice, the better.

Have we got onto

the subject of whether they pay

their taxes?

We have not got time for that. Thank

you so much for coming in, it has

been great having you here. Did you

try that seaweed pasta?

No, I will

try it.

The Green room is even

greener than ever today.

Because it has got some green pasta.

It takes quite a long time to cook.

40 minutes to soak it in cold water

and 20 minutes to cook.

We have got all the instructions

here. 20 minutes to soak and 20

minutes to cook it. But it is £5

about.

That is what I am worried about.

That is all from today, join us

again tomorrow.