18/01/2018 BBC Business Live

This is Business Live from BBC

News with Sally Bundock

and Susannah Streeter.

Full steam ahead for China,

as the world's second biggest

economy beats growth expectations.

Live from London, that's our top

story on Thursday 18th January.

China's 6.9% growth for last year

is the first time the annual figure

has risen in nearly a decade.

We'll tell you why and what it means

for the rest of the world.

Also in the programme:

Bitcoin in the firing line.

Yet again.

South Korean officials

strengthen their attacks

on the cryptocurrency

as its rollercoaster ride continues.

Let's look at markets in Europe,

today is underway. A mixed picture

emerging. Despite more than 300

point climb on the Dow the night

before. We will tell you what is

fuelling the movers and shakers.

And we'll be getting the inside

track on the craftbeer revolution.

We'll find out how BrewDog has used

crowd-funding to move from a small

UK brewery to become

a global player.

Today we want to know.

New research reveals that microwaves

across the European Union generate

as much greenhouse gas as nearly

seven million cars.

If you're environmentally conscious,

can you live without your microwave?

Just use the hashtag BBCBizLive.

Hello and welcome to Business Live.

Hello and welcome to Business Live.

Hello and welcome to Business Live.

Hello and welcome to Business Live.

The programme is packed as ever, as

you can tell.

The world's second-biggest

economy appears to be

firing on all cylinders.

China's economy grew faster

than expected in the last three

months of the year, despite trying

to balance continued population

growth with the challenges such

as cutting pollution and keeping

a lid on soaring debt levels.

The annual growth rate for last

year was 6.9% last year.

That's better than the 6.7% seen

in 2016, which was the weakest

growth in 25 years

and much better than

the government's target of 6.5%.

This is the number that has just

come out.

If we look back, you can

see the trend of slower

growth since 2010.

This was the double digit growth

area. Since then it has been a bit

of a slow decline.

One reason is China has been trying

to rely less on exports

and being the low-cost factory

of the world and more

on its domestic economy.

Consumers spending

by its own people.

Mainland China.

But with that has

come a surge in debt.

A decade ago, Chinese

companies and households owed

some 6 trillion dollars.

Today, despite government

attempts to limit credit -

that has ballooned to

27 trillion dollars.

Last year.

That's prompted dire warnings

of a looming crisis.

Let's get more on this story

from our correspondent

in Shanghai Robin.

Some good growth numbers, but

overall, is their real concern about

this growing debt bubble?

It remains

a huge issue, debt, for the

government, China's political

leaders and commentators and experts

outside of the country. We have seen

moves towards the end of last year

and it continues to try to de-risk

the most vulnerable parts of the

economy and make a corporate lending

more expensive, cut down on mortgage

availability as well. None of that

seems to have affected 2017. Things

have ticked up, things have gone up

for the first time in seven years in

terms of economic performance. They

will be very pleased. The country's

economy continues to grow at a rate

that many outside of China will be

very envious of. Overall, the trend

over the last 25 years is one of

that growth slowing.

Just how

reliant are these figures? They're

always question marks about whether

they really represent the true

picture about what is going on.

They

are two issues in these figures. You

and Sally have talked about it at

the beginning, China is trying to

get away from becoming reliant on

exporting stuff to the rest of the

world and being reliant on huge

amounts of infrastructure investment

by the government, much of that is

debt driven. It appears on the

export side these figures might be

good because the global economy is

improving and China is seeing that

in its figures. It is having to rely

on what it used to rely on, trying

to get away from that. That might

not be good. Can we trust these

figures? We always have this

discussion. In the week leading to

these GDP figures, there have been

several provincial governments, city

governments who have owned up to

making up their GDP figures. It is

unusual to get that kind of hard

evidence. That only adds to the

scepticism, the doubt that many

people have about China's official

GDP figures. Much of that doubt is

driven by the fact that they frankly

tend to be very, very stable.

Thank

you very much.

Let's take a look at some of

the other stories making the news.

Apple says it will pay

about $38 billion in tax on the cash

it holds outside the United States

because of President Trump's

recent tax reforms.

The world's most valuable

company is thought to have

more than $250 billion

held outside the US and hasn't

confirmed how much of that

will be repatriated.

The tech giant also says

its planning to create 20,000

new jobs in the US at a new campus.

UK taxpayers still owe private

contracters $275 billion

for deals signed under

the Private Finance Initiative,

according to a spending watchdog.

The report comes just days after the

construction firm Carillion

collapsed, sending shock waves

through the economy. It was heavily

dependent on so-called PFI

contracts.

The problems from two

recently-announced major

flaws with computer

chips are continuing.

Chipmaker Intel says that patches

for Spectre and Meltdown might cause

some newer chips to reboot more

often than normal.

The affected chips are mainly

used at data centres.

Who is in charge of that, I wonder?

One chip causing another chip to

malfunction.

It's very complex. So

many.

It fries your brain!

They are

so many people trying to race to try

and find good...

A story that is

frying my vain little bit... --

frying my brain.

Bitcoin has been on

a rather frightening

rollercoaster ride this week.

But even tougher times seem to be

ahead for the cryptocurrency

after the South Korean authorities

repeated their intentions

to shutdown local exchanges.

First, Leisha Santorelli

is in Singapore.

She is completely across this, she

is very calm, she hasn't got the

mental struggle like me. Make sense

of this latest news out of South

Korea.

It looks like South Korea's

government, some people within the

government do not have the stomach

for these ups and downs of

cryptocurrency trading. Look at this

week alone. The collective market

lost a third of its value or about

200 billion dollars. A large part of

this has to do with South Korea

considering a possible ban on

cryptocurrency exchanges the

reaction was so strong because South

Korea is the third biggest Bitcoin

market behind Japan and America. It

accounts between five and 15% of

daily Bitcoin trading. If you trade

Bitcoin in Korea, you can traded at

a premium. It is a kimchi premium. I

mentioned this earlier this week. We

will continue to see prices go up

and down, we saw the situation with

China last year when they shut down

local cryptocurrency exchanges.

Fasten your seat belts.

Mine have

been fasten for weeks! I will keep

it on pegs thank you. Let's look at

markets in general. Hong Kong

closing at a record how. The Dow did

that last night. Closing for the

first time ever above 20 6000. But

across Asia it was not a story that

continued. Most markets in Asia were

all higher for most of the day that

profit-taking kicked in towards the

end. The Nico closing down 0.4%.

That was profit-taking going on in

Tokyo.

The FTSE down a bit. Germany and

France up. It is about earnings, the

Bank of America coming out with

better than expected earnings,

Goldman Sachs disappointing in the

US. It had a loss in the last

quarter of last year. The first time

it has done that for six years. It

is talking about calm markets. It is

making less money, which is quite

interesting. It is all about

earnings, lots of companies out with

news. Let's look ahead to the day on

Wall Street.

Earnings continue, Thursday.

Morgan Stanley will be reporting.

It's the last of the big

six US banks to do so.

Now, it's expected to face the same

fate as other banks.

It will be hit with

a one-time charge as a

result of the new tax

rules, but the rest

result of the new tax rules,

but the rest of 2018 is looking

rosy for the sector.

Including for Morgan Stanley.

Rising interest rates

and higher market

valuations will help

the

banks' investment and wealth

management businesses.

Also reporting on Thursday, IBM.

The company's cloud

and analytics are

expected to really drive

earnings for the quarter.

Also helping IBM, Barclays Bank

has raised its rating

for the company.

A sign its efforts to

turn itself around may

finally be paying off.

Joining us is Jane Sydenham from

Rathbones Investment Management.

Nice to see you. Thank you for

coming in.

Let's talk about the Dow

Jones, another record close of

26,000, to what extent would this

due to the news from Apple, not just

be patchy reading all of this money

and given this additional tax to the

US government, but also, its plans

to create 20,000 new jobs.

That is

probably the more important point.

As companies start to announce how

much tax they are paying, how much

money they are bringing back, how

much investment they are going to

make, we are talking about $350

billion of investment over the next

five years. That's a huge sum of

money. Inevitably, that's going to

start making investors think maybe

these tax reforms are going to

affect me.

There has been a lot of

questions raised about whether they

will trickle down, they will lead to

job creation. Here, there is some

evidence at least with one company.

But that is likely to happen.

There

is anticipation that there may be

others. I can see why it is having a

positive effect.

Let's talk about

the pound, I haven't mentioned it

for a while. It is trading quite

well. Talk us through some of the

reasons, highest since June 2016

compared to the done.

1.3 nine. To

some extent it was an expectation we

might get a slightly softer Brexit

-- it is 1.3 nine. Dollar weakness

and Euro strength, quite a lot going

on in currency markets. A general

sense that there may be a softer

Brexit.

The European Central Bank is

trying to talk down the Eurocom I

wonder how successful that is

proving?

It is. The euro has been

incredibly strong relative to the

dollar and the pound. It may be

starting to cause of the European

exporters a bit of pain. If they can

talk it down, I am sure they would

like to do that.

Of course. A weaker

dollar is certainly good for US

exports.

Give us your take on China,

are you excited by the 6.9% figure?

What are your thoughts?

The word is

relieved, we have been worried about

the fact that China is having to

reduce the amount of borrowing it is

making and whether that was going to

cause damage to longer term growth.

At the moment, that doesn't look as

if it is happening on the been quite

positive. But we have got further to

go. Clearly, there has to be some

reduction in borrowing, it might

have some effect on growth later on

this year.

Thanks. Lots of questions

about whether those reforms are

needed getting rid of those zombie

companies in China and those other

issues. Very pressing.

Still to come.

We'll find out how one UK brewery

has used crowd-funding

to become a global player.

You're with Business

Live from BBC News.

There are lots of company results

out today, including

Associated British Foods,

whose brands include

Primark and Twinings.

And the owner of Costa Coffee,

Whitbread, has warned that business

at its high street cafes has

declined and is likely

to remain "subdued".

Michael Hewson, Chief Market Analyst

from CMC Markets joins us now.

What's happening at Whitbread?

Some people used by the cappuccino

lifestyle?

Good morning. On the

headline numbers if fairly decent

update, 6.8% total growth to date.

On course for a fairly decent year.

But, unfortunately, the cost chain

has been suffering a little bit from

a downturn in football. -- the Costa

chain. This will reignite regulation

that the cost of business could get

spun off. About one month ago, the

US hedge fund took a 3.4% stake in

Whitbread. That will prompt

speculation that they will want to

see significant savings within the

business. With Adam Crozier taking

over as Chairman in March, these

disappointing Costa numbers are

going to reignite that debate.

What

about Associated British Foods? Give

us your take on their results.

Slightly bittersweet update from

Associated British Foods. Sugar is

leaving the sour taste, if you will

forgive the bad pun will stop are

the sugar business declined 13%. It

was offset by prime Marco posted a

very decent pre-Christmas week, 7%

increase in sales -- by Primark. The

US tax changes could also have a

significant positive effect on its

US business. All in all, I would say

that it is a fairly average update

despite the fact that the market has

sold off.

Thanks.

Interesting that our appetite for

sugar seems to be falling, given the

government policy and various things

we have had of late. And more focus

on the BBC Live page about what

accounts for these sales growth at

Primark. Apparently it was the cold

weather snap before Christmas that

really boosted sales even when the

weather was unseasonably warm in

October, everyone was buying woolly

pullovers, gloves and scarves before

Christmas. Lots more detail on our

website, take a look when you have

time.

Our top story, the latest official

data from China shows its economy

grew last year, the first time in

seven years that the pace of growth

has picked up. Let's have a look at

how the markets are faring. After

that record close once more on Wall

Street the FTSE 100 is down

slightly, the Dax in positive

territory, no change for the Paris

market.

The beer business in

Britain is booming,

well, relatively speaking,

and the demand for craft beer has

been a key factor behind the trend.

Last year, the number of breweries

rose above 2,000 for the first

time since the 1930s,

most of them small operations.

BrewDog was one of the first -

and most successful -

starting out in a garage

in North East Scotland 10 years ago.

Now it exports to 60 countries

around the world and has 50 bars

showcasing its latest brews

from from London to Tokyo.

Big global expansion plans as well.

With us is James Watt,

the co-founder of BrewDog.

And as

the co-founder of BrewDog.

And as you

the co-founder of BrewDog.

And as you can

the co-founder of BrewDog.

And as you can see

the co-founder of BrewDog.

And as you can see some

the co-founder of BrewDog.

And as you can see some of

the co-founder of BrewDog.

And as you can see some of the

the co-founder of BrewDog.

And as you can see some of the beers

the co-founder of BrewDog.

And as you can see some of the beers

are out there even though it is

early in the morning in the UK!

Thank you for having me.

Tell us how

it all began, you had a tough life

in Scotland and in the evenings you

made beer in the garage.

I worked on

a fishing boat, might hobby was

making beer and in 2007 we could our

jobs, got a bank loan and some

second-hand beer making equipment

and we certain to make others as

passionate about beer as we were.

What spot bad move, when did you

think you had a great product, what

happened that made you go to the

bank and take that risk? We met

Michael Jackson. Not the pop star

but the world-famous beer and

whiskey expert! He tasted beer we

had made, put down the glass and

said, boys, quit your job is and

make beer. So we thought if he says

that, let's

do it. How did you catapult in that

sense? Because in the beginning it

was you and one other guy and a dog,

I understand! Peddling your beer at

farmers markets.

We have gone from

two people and one dog to a company

that employs over 1000 people and it

has been by focusing on making the

best beer we can and being the best

company we can to work for. We have

been dealing with supermarkets in

the UK, exporting, our original

strategy was to send beer to places

we wanted to visit because we

couldn't get any time off. We opened

our first bar in Aberdeen, our

hometown and we are now up to 50.

To

what extent has this punk equity

scheme helped you? It is a kind of

crowdfunding.

It has been so keen to

everything we have done, anyone can

invest and be part of the company,

they get a host of benefits like

discounts on our bars, and online

shops, tickets to events, and the us

at the time of business model

shortening the distance between

ourselves and people who enjoy the

beers we make and we've used that to

fund growth, build a community and

build business.

Lately craft beer

has become very fashionable. You

were around before that but this

must have helped you in terms of

recognition of your brand, not only

in the UK but outside the UK?

It's

been fantastic to see how the beer

scene in the UK and beyond has

changed in the last ten years. We

could never have imagined what craft

beer would be in the UK today. It is

so good to see people making and

shrinking and enjoying it.

Some of

the world's biggest brewers have

tried to break your many times and

you said no. Others have been bought

by companies like SAB Miller. To

what extent do you compete with the

big monoliths in the beer industry?

We firmly believe in independence.

We believe that is important, the

big multinationals have started

buying players in the craft beer

space, we are not a fan, these

companies are responsible for the

commoditisation of beer on a global

scale which is the antithesis of

everything we stand for. It is like

these guys were selling out to them,

like the Little mermaid being

adopted by Darth Vader!

Your current

export market, you are trying to get

bigger in the US and also China.

We

are about to build a place in China,

we've been in the Chinese market for

eight years, our begets export

markets keen to make beer there and

hopefully kick-start the craft beer

revolution in China.

That potential

market is huge.

A lot lot of

potential out there.

Thank you for

coming in to talk about your

experience and what happened after

you started making drinks in the

garage. I bet a lot of people do

that, although I don't.

Social media platforms have been

attacked again about their content.

Facebook, Twitter and YouTube and

Google have all faced criticism and

been answering their critics. At ago

the lawyers and income the company

bosses, but finally despite getting

access to decision makers, senators

achieved little with questioning. It

seems this session was about keeping

up the pressure on the companies

while making fake demands to do more

to stop extremist content and

propaganda.

The basic questions that

we want to ask are, what have we

learned, what are we correcting,

what is going to happen in the

future and how can we get ahead of

it before it does?

Despite recently

missing a separate committee's

deadline for providing information

on its efforts, Twitter like the

other firms did its best to explain

how it was dumping and undesirable

content.

We spot 90% of terrorist

accounts before anyone and we

stopped 75% of them before they can

spread their did or but ideology.

Once again social media bosses have

been dragged to Washington to face

frustrated politicians who say they

must do more to solve the problem.

The Texans are united in the goal to

make sure that more regulation is

not passed to force them to stamp

out the problem. Could they be doing

more?

It's easy to do spot the worst

of the junk news, those you are else

spreading misinformation and they

should be taken off-site, it should

be much tougher to share news that

is full of lies.

Later this year

America will vote in the important

mid-term elections, scrutiny of

these companies and the role they

play in democracy will be more

intense than ever. Dave Lee, BBC

News, USA.

Jane, do you own a microwave?

I do.

I don't have a posh one. Could you

live without it? Some say my grades

in Britain generate as much carbon

dioxide as millions of cars,

although many would say they are

more energy-efficient than a

conventional oven. That is my

understanding and the problem is I

don't think people will give up

microwaves because they are

convenient of our lifestyles. But

whether we ought to keep them for

longer so we use them to their full

potential before throwing them away

as part of the problem.

That is one

highlight of this study, the life of

microwaves is much shorter now.

We

have received a few tweets. One of

viewers says that they so 1980s, he

doesn't use them any more. Another

says, I will get rid of it. Someone

else says, I have not and one in

years and I don't miss it. I would

miss mine. My little nonscientific

survey in the BBC is that we have

all had our microwaves for a very

very long time. Let's talk about

this car in Japan. It has been

invented since this in Army, a car

that can float. -- since this an

army. I gather that the inventor was

worried about his mother and whether

she might have been able to escape

because she found it hard to walk so

he thought if he could develop a car

that floated that would be a

solution to the problem. These have

been around for sometime.

This is

the first electric vehicle. People

will probably only use it once in a

lifetime that it's a start up and

he's hoping for success.

Thank you,

Jane for joining us.