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This is Business Live
from BBC News with
Samantha Simmonds and Tim Willcox.
All systems go -
the World Bank says the global
economy is set accelerate this year.
But will everyone feel the benefit?
Live from London, that's our top
story on Wednesday, 10th January.
It's being predicted the global
economy will operate at close
to full potential for the first time
since the financial crisis of 2008.
We'll assess what impact that
will have on real prosperity.
Also in the programme:
Airbus seals a huge deal
with China to supply 184 jets.
We'll assess what this
means for the company.
Here is how the markets are looking.
Today we're bringing
the sparkle to Business Live
we'll be talking Swarovski crystals
with the great, great granddaughter
of the company's founder.
As always, do get in
touch with your thoughts
on any of the stories
we're covering the show.
Just use the #BBCBizLive.
Hello and welcome to Business Live.
Now, after a decade of hardship and
austerity, things are looking up.
The World Bank says global economic
growth is likely to strengthen this
year and that it will be the first
year since the 2008 crisis when the
world will be operating close to its
full potential. Overall global
economic growth is expected to edge
up to 3.1%. That's after a much
stronger than expected 2017.
Advanced economies will be around
2.2%. Emerging economies are likely
to grow by 4.5%. Generally this is
because of increased investment in,
improved confidence and a rebound in
commodity prices. This last one is
especially important for developing
economies. Well the World Bank says
the focus should turn to the
policies needed to boost potential
growth and living standards.
Dean Turner is an Economist
at UBS Wealth Management.
Thank you very much for joining us
on the programme. Any surprises
here, do we think or not?
overall message in terms of global
growth holding up at levels similar
to what we saw last year, there has
been an upgrade, but there is not
much change. It is not a surprise,
but it is an encouraging story.
terms of inflation, looking at the
In terms of
inflation, clearly we have been
through a period of extraordinary
low inflation. It seems that as we
are moving into 2018 the process of
normalisation will continue. In
terms of what we have seen in China
today, I mean, the numbers are
pretty much in line with what the
markets were expecting.
Numbers around 1.8% for CPI in China
which is what the markets was
expecting, but it is important to
remember with inflation in China, it
is driven by housing costs and food
price inflation so it can be
volatile in the short-term.
talking to the author of the report
earlier and she was saying that it
is cyclical and this is to be
expected and it is about time
really, but also to be expected will
be a downturn, she said, what needs
to happen now, everyone needs to
manage their economy to say make
sure that doesn't happen and learn
the lessons of the past, what does
the global economy need to do to
keep this going?
I think what we
have seen so far in this cycle, we
have seen the beginning of monetary
policy, normalisation, we are likely
to see further normalisation take
place this year within Europe. We
are likely to see the quantitative
easing programme slowing, but
perhaps coming to an end this year
as well. The message to take away
from this is we are entering a
period of normality, normal
identitiesation and that can only be
a good thing.
And what about who is
making the money, who is getting the
benefits of the growth, is it the
richer getting richer?
One of the
bigger economies that we have seen
throughout this whole cycle is what
is happening to real wage growth. It
is not just in the UK, but globally
and we have got very tight labour
markets, not just in the UK, but the
US as well and there are signs that
we're getting tight labour markets
in the eurozone as well. We're not
saying wage growth come through yet
and that's going to be the key thing
to focus on this year and that's
going to be the key thing that
improves living standards.
right, Dean good to see you as ever,
thank you for coming in, thank you.
Let's take a look at some of
the other stories making the news.
French officials say China has
placed an order for a 184
Airbus A320 airliners
on the final day
of President Emmanuel Macron's
visit to the country.
Final details of the deal
are in the process of being worked
out with the Chinese authorities.
Boeing says it delivered a record
763 jetliners last year -
which means it's likely
to retain its title as the world's
The firm says it also
received more than 900 net
new aircraft orders last
year worth $135 billion.
Shares in Kodak soared nearly 120%
after it revealed plans
to mint its own crypto-currency.
The US firm says it will be working
with Wenn Media Group
to launch the Kodak Coin.
It has also given details of a plan
to install rows of Bitcoin mining
rigs at its headquarters in the US.
Apple has announced that its iCloud
services in mainland China will be
operated by Chinese company GCBD,
from next month.
It says the partnership will allow
Apple to "improve the speed
and reliability" of iCloud services.
But there are concerns that the step
will give Beijing more opportunity
to monitor its citizens and others
living in the country.
Our China correspondent,
Robin Brant, joins us from Shanghai.
Robin, what can you tell us?
Well, it's another sign of how
important China is to Apple's
strategy. Going forward as it tries
to strengthen even further. We had
confirmation today of an
announcement in the middle of last
year that Apple's iCloud services in
mainland China will be essentially
handed over to a company linked to
the Government down in the south of
China and this company GCBD will run
Apple's iCloud services in China and
that means there is going to be new
terms and conditions. In an e-mail
sent out to iCloud users in China,
those who have Chinese accounts, it
warned them that they should look at
the terms and conditions and said
photographs, documents and any
back-ups will be subject to
different terms and conditions by
the end of February and it said
anyone who might not be happy with
that, could deactivate their account
or change it to a different country.
This is just the latest sign of
Apple having to comply, it says,
with Chinese regulations and the key
regulation here is that any firm
wishing to provide cloud computing
services must have the servers based
in China and they will be subject to
Chinese laws and rules, laws and
rules which some critics say are
different to regulations say in the
European Union or in the United
What do we know about GCBD?
GCBD is a partnership, Apple
describes. It is owned by the
Government. It is a place that wants
to become the big data centre of
this country, but the issue for many
critics this is an entighty of the
Chinese government, the Communist
Party as well and they think it is a
particularly sinister turn of
Another record close in the US,
for the Dow, S&P and Nasdaq.
But that hasn't carried
through to everywhere in Asia
where many markets are slightly down
except for Hong Kong
which has risen slightly,
helped by energy shares climbing
with another surge in oil prices.
Let's look at the European markets,
the FTSE up slightly. The others
Samira Hussain has the details
about what's ahead
on Wall Street Today.
On Wednesday the US Labour
Department will release export
and import prices for December.
Now, these measures show how prices
of a market basket of goods
in international trade change
from one month to the next.
Now, these numbers are used
to predict possible future
inflation, to set fiscal
and monetary policy,
to measure exchange rates,
forecast futures prices and,
of course, to negotiate
Now, the import prices are expected
to have increase by 0.5%
in the month after a rise
of 0.7% in November.
Export prices are likely to have
risen 0.3% in December,
compared to a 0.5% rise
in the month before.
Home-builder, Lennar, will report
higher profits and revenue
for the last three months.
The improving job market has been
lifting demand for housing
and investors will be looking
for comments on the impact of
changes in tax laws on home sales.
is Global Market Strategist at JP
Morgan Asset Management.
Thank you very much for being here.
So you want to talk about
unemployment in the eurozone first
Yes, it was released
yesterday with a significant fall.
If you look at it on the month it
fell 08.1% -- 0.1%. It is the
largest fall in unemployment over
the past 12 months in the eurozone.
That means in real terms that people
are employed more than ever in the
eurozone. Good for consumers, good
for confidence and retail sales, the
more people are in work, the better
the economy does. That's one of the
reasons we like the eurozone.
Something good for France on the
closing day of that Macron trip to
The Airbus deal.
of money on the table there if it
gets finalised. A big, big symbolic
thing as well for France because the
Macron presidency was based on
making France a leader in the
business world and making it more
efficient for global business and if
the deal goes through with China,
the leading economic fire house of
the world then that could be big.
That gift of a horse has really paid
It could be.
Oil prices sitting
at a three year high?
First, we have
to remember that the production has
been cut. So, the reason why the oil
price fell in the past few years
because the producers were pumping
oil into the markets and the price
was pushed down by that over supply.
Now we have the producers pulling
back a bit, we are seeing a higher
oil price and some of the highest
levels we have seen in the past few
years and while that's important for
just the oil price, it is important
for the countries and economies that
export that. They're in a better
position because they can get more
money off the sales, but the people
who buy that. So it will be
interesting to watch.
What do you
make of this World Bank report about
I think it is
emphasising what we have been saying
for a while, growth is looking good
around the world for the first time
since the economic crisis, we are
seeing every economy in the globe
growing and that's huge. In 2009 if
you look at the map, most economies
Good to have you on.
Thank you very much.
Still to come, we'll be
joined by Nadja Swarovski,
the first ever woman to be appointed
to the executive board of Swarovski.
You're with Business
Live from BBC News.
The UK's second largest supermarket,
Sainsbury's, has raised its profit
guidance after record sales
during Christmas week.
Sainsbury's said it now expected
annual profits to be up
to £20 million better than expected
despite supermarkets facing
a "challenging" market.
The chain sold 1.1% more in the 15
weeks to 6th January,
with grocery sales up 2.3%.
Joining us now is
Neil Wilson, senior market
analyst, at ETX Capital.
Welcome to you. So how have they
managed to do it?
Sainsbury's have enjoyed the uplift
from the trend that we saw in
December. We saw the figures showing
that Britons spent £1 billion over
Christmas. Whilst the like for like
sales growth was decent at 1.1% and
ahead of expectation it is lagging
competitors. We saw Morrisons at
2.8% and we have seen the German
discounters Aldi and Lidl, they saw
sales increase by 15%. 16% over
December, so whilst the top end
growth looks decent, there is still
the relative values maybe not there.
But food inflation presumably
playing into the figures in a
significant way as well.
right. I think what we haven't seen
today is the details on margins and
we know in the first-half, the
margins at intoes collapsed from
2.5% to below 2% and I think that's
really something that needs to be
addressed. Clearly, there is a lot
of pressure with food inflation as
you say, and that does flatten the
top line sales. It is easy to
generate higher sales when the
prices are going up, but retail is
all about margins and if intoes
isn't improving its margins it is
not doing as well as the top line
Neil, thank you
very much indeed for joining us.
Govia Thameslink franchise is not
providing value for money. The
largest rail franchise has not
provided value for money. Passengers
have suffered the worst rail
disruption in the UK according to
this highly critical report. It
found the services had been the
worst on the network since Govia
Thameslink took over the route. The
Department for Transport said the
disruption caused a shortage of
train crews and blamed not for
having adequate staffing. It had too
few drivers when it was awarded the
franchise in the first place.
You're watching Business Live.
Our top story:
The World Bank says it expects
the global economy to pick
up speed this year
and to operate at close
to full potential for
the first time in a decade.
For over a century, the Swarovski
name has been synonymous
with luxury crystals -
the Austrian firm supplied crystals
for Queen Victoria's dresses.
It was founded by Daniel
Swarovski in 1885.
His great, great grand
daughter Nadja Swarovski
made history in 2011,
by becoming the first woman to be
appointed to the executive board.
She oversees the brand
strategy of Swarovski's
$3.8bn global business,
working with the fashion industry
and designers to keep
Nadja Swarovski joins us now.
I went to a gallery just before
Christmas and I saw some art using
the crystals, you are branching out.
It is a multifaceted product and I
was proud to see it used in such a
beautiful way. It can go into a
different direction but this is what
we are trying to do, to steer
designers into the right direction
in terms of the use of crystal.
us back, in its heyday it was of
course used by the fashion houses of
the day and then it fell into
decline in terms of its usage there
and became really well-known for
crystal animals in the 70s. What
happened, how did that happen and
how did you resurrect it so
They heyday was the
late 40s and 50s when we saw style
icons experimenting with fashion and
different materials within their
fashion and I have to say it was my
grandfather who work very closely
with them. I heard stories by him of
working with these people and
eventually when I found myself
joining the company you are right it
was all about the crystal animals
which was wonderful because I
appreciate how hard it is to make
those crystals but I felt the
heritage was not properly reflected.
So I think the decline happened
because perhaps there was the
inappropriate use of crystal and as
mentioned it's so important to
implement the crystal in the right
creative way to find the right
creative expression in order to be
How do you contain that
and control something like that
without actually restricting the
obvious growth you looking for?
try to lead with a good example and
the way we brought ourselves back to
the forefront of fashion was by once
again teaming up with people like
Alexander McQueen who brought us
back into the rightful position. You
use people like that to demonstrate
the creative merit of crystal and
hopefully the industry follows and
that was the case with Alexander
McQueen. Our challenge is to
continue to find innovative
designers that inspire the rest of
the industry, whether it's fashion,
jewellery, architecture or art.
have five quite the path in terms of
running the company, when you took
over you had challenges within the
company itself to drag it in the
direction he wanted to go.
It was a
challenge but if your last name is
the name of the company you
certainly feel a strong motivation
to position the product in its
rightful way. I have to say it's all
has been very inspirational to see
how the market responded, not just
creatively but also financially and
we see it very often when we have
standing initiatives that the
financial rewards follow. Therefore
it's important for us to demonstrate
a very good position creatively.
Tell us about your background, did
you go straight in?
Absently not, my
father was in charge for 44 years as
was my grandfather and every
conversation was the business so I
thought I don't want to work in the
business. It wasn't until I studied
art history and find my path in
fashion I actually knew about the
company and I realised what I could
The founding principles
of your great, great, great
grandfather, presumably you have
followed those to keep the
Absolutely, I grew
up in an environment of hard-working
people passionate about what they
have created, my great, great
grandfather was the first to use
electricity to power his machines,
eventually moving to Austria were
used hydro electricity in 1895 which
was so cutting edge. That is what
made the company as big as it was.
This is the challenge today, how do
we keep up the innovation, what do
we do and how do we implement our
technology to create a product which
is totally irrelevant to the
consumer and in powers the consumer?
Tell us about that, you have created
this crystal mesh?
Yes, it was
another material, metal on top of
which we applied the crystals, so
it's like a fabric, it's very fluid,
you can use it in jewellery and
I long does it take to
It is a very tedious process
but in a nutshell, how long does it
crystal mesh? We melt the crystal,
we melt the glass in tonnes and then
it goes into smaller moulds and they
are cut, then eventually they are
sorted out by quality, so it's a
long process and very tedious and
Really good to talk to
you, I actually wrapped up one of
your bracelets last night to give to
as a gift to somebody.
I really hope
that person feels empowered.
you for coming in.
Now, they may be out
of the reach of you and I -
but a report out today suggests
that the market for
superyachts is booming.
One particular winner in the global
race to attract billionaire dollars?
The British yachting industry.
For more, our business
correspondent Kim Gittleson
is at the London Boat Show.
I bet there are some beauties there.
It's quite astounding, I am
surrounded by some of the most
expensive boats and yachts on the
planet. Anything less than 24
metres, around 80 feet is just a
yacht, not a superyacht these days.
One of the biggest benefit trees has
been the British board and yacht
industry, report this morning
suggesting cells in the past year
have increased by 3.4% to £3.1
billion or around $4.2 billion. One
reason is the weaker pound as a
result of Brexit making a lot of the
boats here more to international
buyers. I will be here all day
looking at over 300 exhibitors to
try to figure out what you get if
you buy one of those yachts or
boats. Stay tuned for more.
you very much. I'm not sure what the
cheapest one is. I don't think it
would be in either of our price
Nandini is back to
look at the papers.
We have got a story, I am tried to
get it on the website, it's about 5p
plastic bags at the moment it's only
big shops that do that but they
might extend it to corner shops and
interesting, the government says the
5p charge on bags has reduced usage
It's been huge. In such a
short beaded of time.
I think that
is the key, as an economist you'd
think by P is not as much as what
you are buying but it's the extra
cost which deters people from
wanting it, so I think the logic of
it applies to more stores, different
bags, there could be success is no
Is there any concern
about where all this money goes?
does not seem it's a huge part of
this story. I think the general
sense is it is to reduce waste and
be better for the environment and I
think broadly you could say most
people would be on board with that.
There is a huge backlash about all
this waste, we did a story about
copy cups the other day but I think
people are generally on board.
Everyone wants to do their part.
It's simple if you don't want to
play on a plastic bag take your own.
Or easy cloth bag. Or a trolley.
Toyota and Mazda picking Alabama for
a big investment, 1.6 billion.
are thinking about starting a new
venture in the US state of Alabama,
it would produce 200,000 vehicles
per year which is huge. Definitely a
big thing for a country like the US,
we think about with the UK and
Europe as well, not known for
manufacturing, it's a dying or a
weekend part of the economic space.
Where does this play into Donald
Trump's views about Japanese cars
I think the fact it's
been made in America and
manufactured in America and will
employ 4000 people in a state which
is not always at the top of economic
output lists could be very good for
the campaign promises as well as
just bringing up different parts of
the US economy to catch up with
Bad news for North
Carolina, interesting in terms of
what the states could offer in terms
of supply chains.
Yes a lot of
competition in American states but
on the whole it looks like it would
be good for the US and certainly
symbolises the sense of
manufacturing and global trade
happening more and more.
think big companies do want to play
ball with Donald Trump, they are
listening to what he said?
political or maybe social use a site
he is the leader of one of the
largest economies in the world which
has a lot of manufacturing power. As
well as global presence. People care
about what America does and makes.
was wondering if this would change
any domicile line of companies
bearing in mind the tax reforms
which have gone through.
something we are looking at, which
could boost a lot of American
companies and has been one of the
reasons we like American equities,
it's a complicated tax loss we have
to see how it affects various
companies, if they are domiciled in
America are not, it should be an
interesting year for companies.
the best option is to be stateless
and not pay anything anywhere! Good
to see you, thank you. Goodbye for