19/03/2018 BBC Business Live

This is Business Live from BBC

News with Sally Bundock

and Jamie Robertson.

Six more years!

Vladimir Putin is re-elected

as Russia's President.

Live from London, that's our top

story on Monday 19th March.

President Putin is promising

an increase in the standard

of living and big spending

on health, education

and infrastructure.

But can he keep his promises?

We'll get an expert view.

Also in the programme...

The boss of Facebook,

Mark Zuckerberg,

faces a backlash over the company's

use of data during the US

presidential election.

And markets are open

and trading in Europe -

it's another week packed

with Central Bank action.

We'll tell you all you need to know.

Also in the programme, here's

a story to get the heart racing!

We'll be getting the Inside Track

on fighting the flab

with an entrepreneur

in the booming fitness sector.

And following that story

about Facebook, today

we want to hear your

thoughts about how the tech

giants use your data.

Let us know.

Just use the hashtag #BBCBizLive.

Hello and welcome to Business Live.

As usual, it's jam-packed. We begin

in Russia.

Vladimir Putin's re-election

hands him another six years

as Russian president

and extends his grip on the world's

12th biggest economy.

This economy has had a tough time of

late.

As you can see, growth was stronger

when Mr Putin came into office

at the turn of the century -

but the economy has suffered

in recent years as global oil prices

fell, with Russia dipping

in and out of recession.

Russians have seen

living standards fall.

Look at this sharp drop, which has

just disappeared! This is what

happened when international

sanctions were imposed on Russia

when Russia annexed Crimea.

The average income is

now just over $10,000,

a third lower than its peak.

That is a figure from 2016.

But Mr Putin said he wanted

to reverse that gap

with a 50% rise by 2025.

President Putin did pledge

to spend more on healthcare,

education and infrastructure

including about $194bn on roads

over the next six years.

There is some room to spend

because government debt

is relatively low -

just 13.2% of the economy in 2016.

That is something that many around

the world would envy.

Andrew Foxall is director of Russia

and Eurasia Studies Centre

at the Henry Jackson Society.

It's extraordinary that in a country

which has seen declining wealth for

the average person, to get such a

landslide majority. One can say what

one likes about the election, but on

the other hand, he is still very

popular.

He is indeed. It is

important to say that President

Putin's popularity was, during his

first two presidential terms between

2000 and 2004 and 2004-2006, very

much based on Russia's economic

performance. As your graphics are

suggested, these were the boom years

based on oil and gas sales of 9% or

10% GDP growth year-on-year.

And yet

the reverse happens, and his

popularity goes up!

Now his

popularity is based on Russia's

geopolitical status. Since 2014,

Russia's economy has been

stagnating, partly as a result of

Western sanctions, but also because

of a fall in the global price of

oil. But that stagnation predates

the 2014 annexation of Crimea.

How

long can his political popularity be

maintained without an upturn in the

economy? The economy hasn't crashed.

It hasn't crashed. It is struggling,

it's fair to say. GDP growth last

year was 1.7%. That compares pretty

favourably to 2015-2016, when GDP

fell by 4%. Many Russians remember

when the economy was an awful lot

worse in the early 1990s, when it

fell by 40%. So it is all relative.

Since President Putin returns to the

presidency in 2012, he has

demonstrated an inability to

generate any degree of domestic

legitimacy in the context of

economic stagnation without foreign

policy achievements. So that might

be Crimea, it might be Ukraine as a

whole, it might be Syria, MIB the

Fifa 2018 World Cup.

So you're

saying in order to achieve political

legitimacy, he has to go outside

Russia? He has to continue being

aggressive to maintain his political

superiority at home?

Precisely. He

has political superiority anyway

because it is effectively an

authoritarian state. But he has been

unable to generate any legitimacy

without foreign policy goals,

because the economy has been

stagnating.

Andrew, thanks.

Let's take a look at some of

the other stories making the news.

Melrose Industries has stepped

up its fight to snap up UK

engineering firm GKN,

with a promise to pump

around $1.4 billion

into the firm's pension fund.

The hostile takeover bid by Melrose,

worth some $11 billion,

has attracted opposition

from politicians, customers

and some shareholders.

Apple is designing and producing

its own device displays

for the first time at a secret plant

near its California HQ,

according to Bloomberg.

The iPad maker is reported

to be making a big

investment in the development

of MicroLED screens,

which use different technology

to the current OLED

displays, and could replace

those made by Samsung.

The G20 gathering of finance

ministers kicks off

in Buenos Aires against a backdrop

of global trade tensions.

There are concerns over

a potential US-China trade rift

and President Trump's steel

and aluminium tariffs.

Facebook and a US data firm,

Cambridge Analytica,

have been accused of gathering

information from 50 million

profiles without consent.

Although Facebook has

suspended Cambridge Analytica

from its platform, the social media

giant's chief executive,

Mark Zuckerberg, is facing mounting

pressure on both sides

of the Atlantic.

Dave Lee reports

from Silicon Valley.

Facebook may be something

of a tourist attraction

here but for many, this place now

represents something else.

The company that has enabled

the collection of personal

data that was then used

for political propaganda.

Its latest problems

are because of information allegedly

obtained by Cambridge Analytica -

the firm widely credited

with helping Donald Trump

win the presidency.

Reports claim details of around

50 million profiles were gathered

without the users' explicit consent.

Both Facebook and Cambridge

Analytica deny any wrongdoing.

But now prominent lawmakers

are demanding that Facebook's

founder Mark Zuckerberg address

the concerns about his company

in person and not just

through his own Facebook page.

Mark Zuckerberg needs

to testify before the Senate

judiciary committee,

demanded one Democrat,

who said her office was launching

a fresh investigation.

Former presidential hopeful

Marco Rubio had this

to say on Sunday morning.

These companies are

growing very fast.

Within the span

of less than ten years

they have gone from being a novel

idea to a major corporation.

And I'm not sure if the sort

of institutional knowledge

about responsibilities both legal

and ethical that come with that have

kept pace with the growth.

Similar calls have been made

in the UK and investors are perhaps

beginning to show some

signs of concern.

If Mark Zuckerberg hides behind

the walls and is not front

and centre, this has potential

to grow into something a lot more

onerous for the Facebook model.

So it is trying to get ahead

of this storm before it

turns into a hurricane.

Facebook became a multi-billion

dollar industry because it made

advertising more effective

by knowing more about each

and every one of us.

It seems that same innovation

has given added power

to political propoganda as well.

Are you concerned about what

Facebook or any other platform,

Google, Twitter, Instagram is doing

with your data?

Are you worried or

have you got the most incredible

privacy settings?

Are you worried

about them reading what you have to

say?

I just assume what I put out

there is available to everybody must

I don't write much. Do get in touch

and we were so your comments later.

There's a new boss in charge

of the central bank in the world's

second largest economy -

the People's Bank of China has

appointed US-educated economist

Yi Gang as its next governor.

Let's go to our Asia

business hub in Beijing,

where Stephen McDonell

is following the story.

We say he is new in the top job, but

he has been there quite a while.

Well, one of the most interesting

things about the unexpected

appointment of Yi Gang to head up

China's reserve bank is that we

don't really know whether it will be

him or the newly appointed Vice

Premier in charge of China's

economic policy. The vice president

is already powerful. He went to

Washington in a failed attempt to

stave off those US steel tariffs,

but either way, Yi Gang will be one

of two people pulling the levers

here. He is on the record as saying

he was to open up the Chinese

economy to more foreign investment,

especially in the finance sector,

but his other two headaches will be

controlling the ballooning debt in

this country and working out how to

deal with the potential trade war

with the United States. Whichever

way you look at it, he has what is

probably one of the most important

jobs in the world.

Thank you. So

that is one of the central bank

stories which has kick-started a

week that will be dominated by

central bank news, because as

Stephen was saying, Yi Gang has been

appointed as the head of the

People's Bank of China, but we also

have Jerome Powell's first meeting

as governor of the US Federal

Reserve. That takes place tomorrow

and Wednesday. And we have the Bank

of England, so there is quite a bit

going on with central banks. But

also in terms of how markets did

today, you can see that is how

things ended on Friday. This is

Australia and Hong Kong, but it is

important to note that Japan closed

down by almost 1% at the end of

today's trade. A lot of the losers

today our suppliers to Apple. For

example, Samsung shares were hit.

These companies are the companies

which make the displays for Apple

products, the iPhone and the iPad.

That is huge in terms of revenues,

but could be lost if Apple starts to

make their own screens. Let's look

at Europe quickly so you have a

sense of how the European day is

going. I am hoping we will get the

European numbers. We are trying to

change them, but we can't, so I will

hand over to Jamie.

It works over here. The Dax is down

sharply and the FTSE is down

sharply.

Lawrence Gosling is with me -

he's the editor in chief

of What Investment.

Let's start with that Apple story.

It is because of the ramifications

for all the other countries. It is

great for Apple, presumably, but not

for the companies supplying Apple.

No, and a spot of the tariffs are

given we are having as well. Some of

these companies may be subjected to

tariffs into the US. So you can see

Apple shoring up its production,

which will increase its margin if it

can do it cheaply compared to

suppliers from Asia.

Do you think

this has anything to do with the

environment we are in with President

Trump at the helm? If they make

their dispose in California down the

road, it is a lot easier if you have

tariffs going on.

You are spot on.

Politically, it looks very good. We

have seen General Motors doing

similar things. Partly, it is to

curry favour with the presidency.

I

can understand the emphasis being on

the big companies and big

manufacturing, and that is what

Trump's home ground is. Whereas the

tech companies, I feel they have

slightly gone their own way.

We are

in a slightly different environment.

The tech companies are not the

darlings they used to be. People see

them as being more sinister.

Big

week for Jerome Powell.

A very big

week for Jerome Powell, the new head

of the Federal Reserve in the

States. We are looking forward to

listening to him. The market is

pretty much priced in a rate rise on

Wednesday. This is the first of four

rate rises this year.

That is the

prediction, not a given.

Never a

given, but it is the prediction from

the markets. Then we have the Bank

of England, the EU and a new

governor in the central Bank of

China. So if you love central banks,

this is a big week.

I love them. But

I am missing Janet.

I think she

misses you too! On the Russian

election, any thoughts on that?

The

Russian stock market hasn't moved

much in quite a while, ironically.

But the economy is where the big

problem is and President Yeltsin Dr

I did say Yeltsin! I am showing my

age! Mr Putin.

You only read about

him in history books. That is a

blast from the past.

The economy is

back in President Yeltsin's age,

even though it is President Putin

now.

Still to come.

Healthy body, healthy mind!

Later in the programme,

we'll be getting the Inside Track

Still to come.

on the business of staying in shape!

You're with Business

Live from BBC News.

Stay with us.

Travelodge has released

full year results today.

Total revenues grew 6.6%

to £637.1 million in the 12

months to December.

And it has also announced the

expansion plans including something

called the superbly.

Joining us now is Peter Gowers,

the Chief Executive of Travelodge.

Huge expansion, you're going to

employ a lot more people.

Britain is

becoming a nation of hotel budget

travellers. As we have attracted

more and more people it gives us

different kinds of groups to target

and for some of the longer staying

business customers we have

introduced super rooms.

Talk about

costs and employees from the EU and

in particular. Something like 30%

come from the EU. Is that a problem

for you?

Well there are no real cost

pressures right now, the national

living wage, the apprenticeship

levy, these are bigger things but

medium-term Brexit is a factor. We

are taking measures now to try to

protect ourselves against a

shortfall of Labour post Brexit.

Supporting staff to apply for

residency if they are already here

and widening up apprenticeship

schemes. Also attracting back

working parents.

You say in the UK

that we are seeing a build in the

budget hotel industry. How long do

you think that this will continue,

what is your long-term forecast for

Travelodge?

Today in the UK roughly

one in five hotels is a budget hotel

for the friends it is one in four

hotels and one in three in the

United States. So plenty of room for

expansion. We hope to open 100

hotels in the next five years so

future expansion plans focused very

much on the UK.

Thank you very much

indeed. Those results announced

today. One interesting story on the

business page, betting machine wages

are to be cut to £30 alas, that is

the maximum amount you will be able

to bet on these fixed odds betting

terminals. By some thought it would

come down from £100 down to just £2

but it is £30 so somebody for the

bookmakers for top that some relief

for the bookmakers.

You're watching Business

Live - our top story.

Vladimir Putin has won the

presidential election in Russia. So

he is in charge for another six

years. He received more than 76% of

votes in the election on Sunday. He

served as either president or Prime

Minister since 1999 now.

Many of us want to be healthier -

and increasingly there are services

to help us achieve that goal.

The fitness industry in the UK

was estimated to be worth

$6.5 billion last year -

up 6% from a year earlier.

And that's just for people

who go to the gym.

But if you're short on time you can

download e-guides to give

you a bit of support.

London Muscle has sold 130,000

of these guides since 2013.

And the company also

dabbles in clothing,

a supplements range,

and last year they launched

a fresh food delivery arm.

Tom Exton, co-founder

of London Muscle is here.

Welcome to the programme. And that

was used in that video behind us. --

that was you. Just tell us about how

this started. Clearly you are

someone who is really into this, in

the gym and busy trying to get

fitter.

It began as a hobby back in

2012, myself and my twin brother and

some other browsers as well used to

be in the gym all the time. And we

thought that we would set up a

website just as a hobby. And it just

spiralled from there. We did not

really need to start a business.

You

have grown pretty fast. I find this

extraordinary. It must've been a

very competitive market. No one is

going to say to you that is a great

idea because everyone would have the

same idea about doing fitness video

on YouTube. What makes you

different? And getting this

particular growth.

I think when we

started we capitalised on the growth

of twitter back in 2012 and then is

to grant came along and we really

utilise social media. And then

fitness became more and more popular

and social media. We just advertise

our website articles on twitter, we

put on recipes, workouts and answer

questions as well.

Most of the

people who download your health

adviser by, do they also go to the

gym, do you know that kind of

information?

Or maybe just at home.

Well the guides have been gym -based

but recently we have introduced home

work-out alternatives as well so

people can train anywhere they like.

So you could do them at home as

well. The downloads, you pay to

download them. The current guides,

it depends how long, you can choose

up to about 20 weeks. That is in the

region of £60, £80. And basically it

is like having a personal trainer

for about 20 weeks.

A personal

trainer, and give me an idea of what

you get.

They will tell you when to

work-out, what to do, repetitions,

tempo, what movement to do. What and

when to eat. But within a flexible

structure. I could go on and on.

Just one quick answer, what stops

people giving up after one year of

doing this because that is the

problem, but people give up.

It is

motivation all the time and there is

an online community, lots of people

doing the same thing and people

sending in their results. You can

see a letter from down the road has

got amazing results. It is kind of

peer pressure if you like.

Thank you

for coming in, really interesting.

This is how to stay in touch. We

will see in a moment. Stay

up-to-date with all the business

news as it happens. And we want to

hear from you. Get involved on the

BBC business life web page.

Lawrence Gosling has returned and we

have been looking at this Facebook

story. This is extremely interesting

because it has been the concern

about these organisations that are

now huge, 2 billion active monthly

users around the world.

Absolutely

and a piece of legislation is coming

in, the general data protection

regulations and this falls into

this. How these companies use data

and how and if we have given them

permission. This is Europe wide. And

there was a harsh penalty, 4% of the

company turnover. So for Facebook

that could be the story. It is about

how we and our data over to them and

how they then use it.

This is a

political story, or is it business

or both? Where do you think it will

have the maximum impact, politically

or in terms of business.

I think

largely it is a political story but

we could see the Facebook share

price drop later. But really here in

the UK we are driving away the

story, and you can see the kind of

power of the MPs on this.

I tell you

what strikes me about this story,

the idea, how little we as

individuals feel affected by this

because who would say I feel I have

been manipulated by these people. No

one feels that, they do not feel it

is a personal affront to their

abilities.

I think it depends what

the information was, and it could

affect future decisions for example

medical insurance and your data has

been passed on to other companies.

But we must state both Facebook and

Cambridge and Alaska are denying any

wrongdoing at all in this case. -

Cambridge Analytica.

Exactly and I

think we feel upset as consumers is

suddenly someone tries to take

something from us but in this case

there was no suggestion that

anything like that could happen.

Couple of messages, one saying they

need to be made far more

accountable. Another saying I came

off Facebook, best thing I ever did.

Thank you for coming in and thank

you for your company. We are back at

the same time tomorrow. We will see

you then. Goodbye.