26/01/2018 BBC Business Live

This is Business Live from BBC News,

I'm Alice Baxter in London.

And I'm Sally Bundock in Davos

at the World Economic Forum.

Today the President takes the

podium. He will be delivering his

message about America first. But how

will it go down with the 3000

delegates.

Live from London and Davos that's

our top story on Friday 26th of

January.

The US President was wooing bosses

of the world's biggest companies

over dinner last night

but will his speech be a receipe

for more investment?

Also in the programme:

Both the UK and the US give

us their latest economic

growth numbers today,

we'll look at what we

can expect to see.

Keeping across the latest market

action, in Europe they have opened

up mixed, over in Asia we saw stocks

extend their winning run on Friday,

and also it was a similar story on

Wall Street with a record closing

high. We will get the inside track

on brand Trump. As the White House

hijacked the media coverage of this

year's World Economic Forum? I will

talk to the global Chief Executive

of the media and advertising agency

Dentsu Aegis.

Hello and welcome to Business Live.

In just a few hours' time

the World Economic Forum in Davos

will hear the speech they've been

waiting all week for.

The US President Donald Trump

is expected to repeat his call

for an America First approach

to international trade and call

on businesses to invest

more in his country.

Many of them will be concerned

about the rise of protectionism.

But the Trump administration

says they shouldn't be.

In the words of senior White House

economic advisor Gary Cohn: "America

first is not America alone".

And as the world's biggest economy

picked up last year so did

the rest of the world.

The International Monetary Fund

thinks global growth

jumped to 3.7% last year -

and will do even better this year -

partly because of

President Trump's tax cuts.

However, last year, as talk

of protectionism grew,

the world saw a 16% fall in foreign

direct investment, that's

when companies invest their money

in foreign countries.

In North America the fall

was even bigger at 33%.

Despite that - the US

was still the most popular

country to invest in -

attracting more than $300

billion from abroad.

Sally, over to you.

Thank you, Alice. It's been the talk

of the week, the fact the President

of the United States has come here

and he has come here with the

biggest delegation of any US

President prior to this year at the

World Economic Forum. They have all

come on message. They are all

talking the talk and they are all

making sure that we in the media are

getting it very loud and very clear.

Well, my colleague here, Kamal

Ahmed, economics editor, has been

talking to all sorts of people at

the World Economic Forum, among them

Larry Fink, Chief Executive of the

investment management firm Black

Rock, and they did discuss Donald

Trump's presence here. Let's listen

to what he had to say.

I think he's been good for the US

economy and therefore it's been good

for the global economy.

I may disagree with

many things he has

said and does but unquestionably

the tax reform is going

to add, you know, at

least nine tenths of

GDP to the US economy.

Some of the deregulation that he has

done has created less

burden on companies and companies

have been able to do more things.

Do you worry about some of the more

protectionist noises that are coming

from the American administration,

including the President?

Is that a concern when

you have also got here

the leaders talking

about globalisation and the need for

multilateralism?

So, I'm under the belief that

globalisation has been

good for more human

beings than ever before.

That does not mean that people have

not been left behind in

the UK, or left behind in the US.

For some of them, globalisation

has not been good.

I think this is why we had Brexit,

I think this is why

we have had the election

of Donald Trump.

Donald Trump understood the fears

and needs of people.

Do you hope for a more

conciliatory tone

from the President when

he speaks on Friday?

I'm not anticipating that.

But hopefully he surprises me.

I think the President

believes he has

a mission to make America great

again and I think, you know, if you

look at all of his behaviours,

he's trying to execute on that.

Whether I agree or

disagree he is trying to

execute on that.

That's Larry Fink, the global Chief

Executive of Black Rock. Kamal is

here. It's interesting, almost as if

you didn't know how to answer that

question, he had to think about what

to say.

Interesting talking to

business leaders here, a lot of

people last year when Chinese

premier Xi Jinping was here were

very nervous about Donald Trump when

he had just won. Was he going to

push through tax or regulation? This

year the feeling is similar to Larry

Fink's tone, the economy has been

boosted, tax reforms have been

passed, the regulation reforms are

going through the system and the

whole global economy is starting to

grow more quickly. So, for someone

like Larry Fink and my colleague

Simon Jack who interviewed Lord

Black fine, the head of Goldman

Sachs, they are saying you may not

agree with all of the politics and

controversy but when it comes to the

brute economics President Trump has

been pretty good for these people.

Let's bring in one of our other

colleagues.

Karishma Vaswani joins

us from Singapore.

The reason I bring you in is because

I know you're listening to Kamal

Ahmed and myself and Larry Fink, but

where you are its a totally

different story, the tariffs on

steel products in Asia coming from

the White House and the counter

response from South Korea.

Indeed,

Sally, and all of this has to do

with exactly what you and Kamal

Ahmed have been talking about, the

comments we expect to hear in this

speech from Donald Trump in a few

hours' time, everyone in Asia is

waiting to see whether he makes good

on this America first policy. Wheel

that is or what appears to be the

first salvo in that policy, the

tariffs you were talking about

earlier, Beijing and

South Korea. Many factories in

Malaysia and other parts of Asia

have also been complaining about

these tariffs because they make

products that are assembled in China

and sold to the United States so

with this official line is coming

out of Beijing there is a great deal

of concern in this part of the world

about what Donald Trump will say and

we will have to wait and see for

another few hours from now.

Thanks a

lot, Karishma Vaswani. If I can

bring Kamal Ahmed back in, the

conversations have been about a

smarter way of doing trade, a

different way, the old system not

working as well, many in the world

not feeling the benefit as it were.

All of this global growth, and yet

Donald Trump talking about America

first, but that being a benefit to

the world. It's an interesting

conversation going on.

It is

slightly more nuanced than maybe

this notion that America is

protectionist. As you said he has a

big entourage, he has Steven

Mnuchin, the Treasury Secretary and

Wilbur Ross, the commerce secretary,

and I spoke to them at their press

conference yesterday and they said

it's not about protectionism or a

trade war, is about rebalancing

trade. He says that trade has been

too asymmetric the way it has

worked, so the disadvantage of

America, he is saying I want more of

a level playing field and that's

what they are fighting for. The

message today from Donald Trump when

he speaks later at lunchtime will

be, look, this can help everybody,

let's have fairer trade, not trade

wars, but some of that will mean

extra trade tariffs and that's where

the controversy comes.

Kamal Ahmed,

thank you. We are going to let you

go, he has an extremely busy day

ahead. Back to you, Alice, in the

studio. Thank you, Sally, and your

guests Kamal Ahmed and Karishma.

Let's take a look at some of

the other stories making the news.

Smartphone sales have fallen in

China for the first time ever,

according to analysts who say 450

million devices were sold last year,

4% less than in 2016. Oppo and Vivo

were the biggest losers but Huawei

has the biggest quarter in its home

market.

The computing giant Intel says it

sales hit grew 9% last year to hit

a record $62.8 billion

thanks to strong sales

of chips to data centres.

It's a key growth area as it moves

away from the declining PC industry.

The company also benefitted

from President Trump's tax reforms

but warned that it will be

negatively impacted by the two major

computer chips flaws that

were recently uncovered

in many of its products.

Starbucks shares fell 5% on Thursday

after the coffee chain's first

quarter earnings missed analysts

expectations - for the fifth

quarter in a row.

Starbuck's global same-store sales

rose 2% in the quarter

against forecasts of 3%.

On the upside, growth in China

was robust - it rose to 6%.

Let's look and see what is happening

on the markets. Stocks in Asia

extended their winning run to an

11th day on Friday, the longest

winning streak we have seen their

Sims 2015. However, Japan's Nikkei

bucked the trend to end the session

down 0.2%. -- since 2015.

World equity markets have

rallied over the past year,

buoyed by a synchronised uptick

in global economic growth in a boon

to corporate profits

and stock valuations.

The Dow and SNP 500 ended

at their highest closing

levels ever on Thursday,

although Wall Street

relinquished bigger intraday gains

after President Trump's

strong dollar comments.

They also helped the battered US

currency win back some ground.

The greenback had sunk

to a three-year low on Thursday.

Here in Europe we've seen

markets open higher.

Mostly in London and Frankfurt. In

France they were slightly down but

they have recovered now.

In London the the pound has also

inched some 0.5% higher at $1.42

following its ascent to a one

and a half year high

the previous day.

One company on Wall Street that will

be in focus today is Boeing because

the plane maker expects to hear a

final decision from the US on its

trade with Canadian rival

Bombardier. Samira Hussain has the

details on this. This jet is the

pride of Bombardier's fleet and the

source of one of the most bitter

trade disputes between Canada and

the United States in recent memory.

These workers in Northern Ireland

could end up paying the price. Big

orders of Bombardier's C series

planes from American buyers prompted

cries of unfair competition from US

plane making giant Boeing. Last year

the US commerce Department slapped

tariffs of almost 300% on any C

series plane coming into the US are

basically blocking the fleet from

the American market. Bombardier took

their complaints to the

International Trade Commission,

which will make its ruling Friday.

It's why both UK Prime Minister

Theresa May and Canadian Prime

Minister Justin Trudeau have spoken

personally with US President Donald

Trump about this dispute. And all of

this comes as both the UK and Canada

have an eye on negotiating good

trade deals with the United States.

But this dispute about Bombardier

could be a sign that easy trade

relations with the Trump

administration is anything but

certain. Samira Hussain, BBC News,

New York. Joining me in the studio

is Richard Hunter, head of markets

at Into -- Interactive Investor.

This Bombardier argument has been

around for awhile, what the it is a

politically charged situation, the

US and Canada are having trade talks

anyway, so this is kind of a poster

child for what is going on there.

And at the same time we have just

seen the recent love in between

Theresa May at Trump in Davos,

needless to say there is a potential

impact on jobs in Northern Ireland

in terms of the aircraft building.

So it's a very interesting one and

it seems the Canadians are saying

because this is US jurisdiction we

are not expecting to win but we will

find a very shortly.

Interesting. I

think Sally has a question for us

from Davos.

I have indeed. It's

looking very cosy in that studio.

Nice to see you, Richard. It's

chilly at the World Economic Forum

but it's going together reheated

later, I'm sure, when President

Trump starts to speak. Richard, I

want to ask about some of the

economic news coming out today, US

and UK growth figures, the talk all

week is about the fact global growth

is going gung ho. What began hear

later?

There to say that in terms of the

US, sweet start at the moment, loose

monetary policy unquestioned global

growth of which the US is taking

part, and also, we have that feeding

through, as we have heard, to the

markets, particularly in the States,

described as the Goldilocks economy,

not too hot, not too cold, but

little doubt that in challenging

economic cycles, the US is nearer to

the end, the next year or so is

going to be interesting. In terms of

the UK, doing OK, doing better than

some have suggested after the

referendum result. By the same

token, it is also fair to say that

while we are seeing growth in the

UK, probably not at the sort of

level we would otherwise have seen

without the Brexit vote.

The proof

will be in the pudding, we will get

the fourth quarter estimate in a

little under an hour's time.

Still to come:

President stay on the podium, he

delivers his America first message

and encourages global companies to

invest in the US. We are all waiting

for it.

You're with Business

Live from BBC News.

As your car ever been damaged after

you have hit a pothole on the road,

it has happened to more and more of

us according to the RAC, they have

released a report showing a jump in

call-outs due to poor road surfaces.

Who is responsible for this, whose

responsibility is it to fix

potholes?

Depends where they really

are, so, if you find them in things

like motorways or major roads, then

it is the responsibility of people

like highways England and traffic

Scotland but, if as many of us do

travel on local roads, where most

journeys begin or end, that is the

responsibility of local councils and

here is where the big problem lies,

because although that makes up 98%

of the road network, about one 50th

of the total money spent on road

repairs is actually on those roads.

Local councils have a big job on

their hands. They feel in 2 million

potholes a year, but they say that

cost them 4.4 billion last year but

they say that they would need about

three times that amount in order to

just clear the current backlog they

have, let alone be able to spot

problems as they appear in the

future.

Interesting, you have been

out and about in Essex, they are

trialling a pothole stop the scheme,

what can you tell is about that?

I

have been hanging out with Eddie the

bin man in Essex, as he did his

rounds, this may seem crazy but it

is the new front line on the war on

potholes, in Essex, in Thurrock,

they have cameras on top of the bin

lorries, they take in every metre or

so of the road and are therefore

able to send data back to engineers

to have a look at and see where

potholes are developing, where there

are already problems. This is

happening not just in Thurrock but

also in York, on buses, and

Wiltshire, they have a electric bike

's. They are hoping to cover a large

part of the road network, and be

able to see whether or not this is

possible. Quite a lot going on. The

study is funded by the DST, a quick

look now to see what is on

the BBC website, on the BBC live

page, a lot on Davos, extended

versions of all the interviews we

have been conducting with business

leaders, and also this, Lloyd's wish

list.

Much more on the BBC website.

Top story today: much anticipation

here and in some quarters

trepidation, US president takes the

stage at the World Economic Forum in

Davos, to deliver his America first

message. We are all waiting for

that. As are the markets.

Pound, Stirling, holding strong at

$1 42.

Let's discuss the day ahead in a bit

more detail. One thing that has

happened for sure, the US president

and his team have dominated the

airwaves in terms of the

conversations taking place in the

media about this year's World

Economic Forum. Just to talk through

the management of the message as it

were, I'm joined by Jerry Bullman,

global Chief Executive of the

advertising and media group, Dentsu

Aegis. Good to have you here. What

is your take on Brand Trump and its

dominance this week? -- Jerry

Buhlmann.

Like any brand, what it

needs to do using gate with its

audience, he has created an

environment where for the whole

week, everyone has been talking

about him coming, and on Friday he

has given himself the last word,

that shows the way he thinks about

things. There is some nuance to

brand from as well, clearly, we know

the America first edition in. --

brand Trump. He is now preaching

engagement on a global stage.

America first, but engaging with the

world, that is a nuance on

developing what is brand is and

giving his brand some primacy in the

context of Davos.

Is this a good

thing or a bad thing for the World

Economic Forum, many are saying,

actually, this is all about

everybody being here and being given

a chance, including the Americans.

Five out of the top seven leaders of

the world have been here this week,

that is a level of political

engagement we have not seen in Davos

for many years, British Prime

Minister Theresa May was here, we

saw a manual mock rock and Modi, a

great deal of engagement between

politicians and academics. It is a

good sign.

Another big discussion

has been all about the big tech

names, Sheryl Sandberg is here,

chief operating officer of bass book

and Chief Executive of Microsoft,

and a lot of discussion about the

impact these companies are having on

all of us. -- chief operating

officer of Facebook. Also concerns

about being too monopolistic, George

saw Ross thought about that at his

dinner, give us your take. Being in

media and advertising, are they in a

dangerous place. -- George Soros.

The Digital economy is by far the

biggest opportunity over the next

five to ten years, the broad scope

of things, a lot of these businesses

have a massive amount of utility

among consumers, we see the growth

of e-commerce, the growth of

smartphones, people accessing

better, all of these businesses

contribute significantly to that. We

want a Brand safe environment for

advertisers, which means we need one

for consumers and people, and

government is recognising there is

issues in that regard. We have to

ensure that we can capture the

opportunities of the digital

economy, in the broad scope,

businesses will be here, some will

be gone over the next five, ten, 20

years, we will still have a much

more stable economy.

Google and

Facebook, between them, they

dominate the advertising space in

terms of where people are putting

their ads, do you see that getting

more or less in the near term?

I

think there is a lot of other

players, Amazon are growing rapidly,

and competing, but Alibaba Group, in

China, and we have seen this between

Google and 10c. There is more

engagement, you will see more

competition.

Thank you very much for

joining us. Interesting discussions

going on, back to you. -- Tencent.

All this week we have been asking

about the issue of sexual harassment

and unfair pay and how do you stamp

it out?

No more secrets, get it out on the

table, let's come clean on the

issues, move on, let's be inclusive

for the future.

The most important

thing companies need to do is create

a pure merit based environment so

that the women get confidence that

they will not be discriminated

against just on the basis of gender.

In China, most of us do not know

what sexual harassment is, I think

it is the company 's obligation to

educate their employees, sexual

harassment is wrong.

It is critical

to transform anger into action. And

action has to start at the top.

Some

people have been badly intended but

the real problem is people have

missed things, and we have two miss

less and be better observers of

these things and spied these

inequalities and discriminatory

practices.

Companies need to

remember that women tend to be more

modest, so they need to be lifted

up, to grow in the rights of

companies.

It is very important

companies create a culture where

women feel welcome, safe and

empowered.

Give her the chance to

study anything she wants.

Business

needs to recognise it is a real

issue, talk about it and do

something about it.

Breadth of views there are, what is

Friday got in store for Davos?

Of

course, the big event, we have

talked about it, all about President

Trump, but plenty of other events

going on. The American delegation

has been talking to the press yet

again, and they are talking about

keeping up to agreements and

enforcing international trade

standards, talking trade already.