:00:02. > :00:12.around the island. They are as are the latest
:00:12. > :00:15.
:00:15. > :00:19.headlines. Now for the latest financial news.
:00:19. > :00:27.Welcome to World Business Report. Here are the headlines: A victim of
:00:27. > :00:31.its own success. Switzerland are battles on the rise of the franc.
:00:31. > :00:37.And Japan's economy are still hit by earthquakes but not as much as
:00:37. > :00:47.many had feared. The president of the World Bank is
:00:47. > :00:50.
:00:50. > :00:53.warning that markets are heading towards a new danger zone.
:00:54. > :00:59.Reports are emerging of a crisis meeting in Switzerland to discuss
:00:59. > :01:08.the relentless rise of the franc. A Swiss newspaper reported that the
:01:08. > :01:13.government and central bank held talks over the weekend.
:01:13. > :01:17.But first we report on the strength of the franc is forcing companies
:01:17. > :01:23.to choose between a making a proper to a losing market share.
:01:23. > :01:28.It may look like business as usual, but the Swiss bank has risen 25% on
:01:28. > :01:33.the row in 18 months. Locals are getting better value elsewhere so
:01:33. > :01:37.local businesses are deserted. Not so long ago companies were actually
:01:37. > :01:42.moving to Switzerland because of the tax advantages of not being in
:01:42. > :01:48.the European Union. But now the height of the franc is causing a
:01:48. > :01:57.problem. Investors are repeatedly having to cut their prices just to
:01:57. > :02:01.keep their customers. This company create designer -- fabrics. The
:02:01. > :02:07.company has already said it has cut prices to the point where it is no
:02:07. > :02:17.longer making a profit. We are looking for new strategies. It is
:02:17. > :02:18.
:02:18. > :02:24.very important that we can survive here in Switzerland. A body
:02:24. > :02:31.representing these was mechanical and engineering industries are
:02:31. > :02:37.saying that one in three companies are now losing money. This goes
:02:37. > :02:43.directly into the margins. We estimate that one third of our
:02:43. > :02:49.members are now on the losses own. It seems that Swiss tourism and
:02:49. > :02:53.exporters are paying the price for their country's safe haven status.
:02:53. > :02:59.Switzerland finds itself in the same boat as a Brazil and Japan. A
:02:59. > :03:09.strong currency it can do little about.
:03:09. > :03:09.
:03:09. > :03:15.For more on the possible solutions to Swiss's franc we are joined from
:03:15. > :03:21.capital markets. Is it likely that Switzerland will try to introduce a
:03:21. > :03:31.limit. This might conform -- compromise its status as a tax
:03:31. > :03:32.
:03:32. > :03:38.haven. The bank has tried to intervene. The problem in doing so
:03:38. > :03:44.is that it would have to give up control over monetary policy.
:03:44. > :03:50.us turn to Italy. There are concerns about Italy's position. It
:03:50. > :03:57.has now passed some sort of measure last Friday. How convincing is it?
:03:57. > :04:03.There is no definitive picture yet until we get all the details. It is
:04:03. > :04:12.a credible measure worth about 45 billion euros. It looks to decrease
:04:12. > :04:18.spending and increased taxes. It is a significant step in the right
:04:18. > :04:25.direction. Given that is what is unsettling the market, could we be
:04:25. > :04:35.in for, a week? The market is exceptionally volatile. We should
:04:35. > :04:38.
:04:38. > :04:44.expect something a little bit. But we are not out of the woods yet.
:04:44. > :04:53.And Nicholas Sarkozy and Chancellor Michel are meeting once again. --
:04:53. > :05:03.Michel. There are no major announcements to come out of the
:05:03. > :05:09.
:05:09. > :05:14.meeting. I think we and can expect support for the Europe. But I'm not
:05:14. > :05:18.sure we will get any specific measures. -- the road. Let us move
:05:18. > :05:24.on to Japan where the economy is recovering from the devastating
:05:24. > :05:31.earthquake and tsunami earlier this year. The economy contracted by
:05:31. > :05:36.0.3%. That is much less than analysts had been expecting. Let us
:05:36. > :05:44.cross over to Tokyo. The response in Japan is pretty good. The growth
:05:44. > :05:54.in Japan -- the recession in Japan is much less than had initially
:05:54. > :05:56.
:05:56. > :06:06.been up feared. We got a decline of 0.3%. Analysts hero had been
:06:06. > :06:06.
:06:06. > :06:10.expecting a decline of a 2%. Production is picking up. The
:06:10. > :06:13.supply chains that were broken when factories making components were
:06:13. > :06:19.damaged or destroyed are being reconnected more quickly than
:06:19. > :06:28.expected. Japanese consumers seem to be getting over their mover of
:06:28. > :06:32.self- -- mood of self-restraint. What is going on in the rest of the
:06:32. > :06:36.world may still pose problems. you compare it to the eurozone and
:06:36. > :06:42.the United States then the underlying dynamic in Asia is much
:06:42. > :06:51.more positive. That is the case. But the critical thing is the
:06:51. > :06:56.dollar - yen exchange rate. Exporters are being relied on in
:06:56. > :07:03.Japan for growth. The issue is how high the end is. It is approaching
:07:03. > :07:13.-- yen. It is approaching its highest levels since the Second
:07:13. > :07:18.World War. Those high rates are really what could harm Japan's
:07:18. > :07:25.progression in the months ahead. A warning from the World Bank
:07:25. > :07:30.president about the state of the market. What did the President have
:07:30. > :07:34.to say? He is concerned about developments
:07:34. > :07:40.that are on going in the global economy. He says that recent events
:07:40. > :07:45.have led a many investors to lose confidence in Europe and the United
:07:45. > :07:51.States. He stressed that policy makers have taken too long to deal
:07:51. > :08:01.with debt issues. Economic recovery is now under threat from a new and
:08:01. > :08:03.
:08:03. > :08:10.different storm. He is referring to the slump in investor confidence.
:08:10. > :08:14.There is concern that Europe's debt crisis may spread. This has
:08:14. > :08:19.basically contributed to double- digit declines in Asian stock
:08:19. > :08:25.markets over the past three weeks. He also talk about China's
:08:25. > :08:34.inflation rate. He said that the appreciation of the currency would
:08:34. > :08:40.reduce pressure. But if the numbers rise to about eight - 10% this
:08:40. > :08:43.would be seen as a very serious problem. It has the potential to
:08:43. > :08:50.disrupt the leadership transition and the growth of the Chinese
:08:50. > :08:53.economy. Thank you. One last a story.
:08:53. > :08:59.Authorities in China closed a chemical plant after thousands of
:08:59. > :09:03.protesters took to the street over pollution fears. 10,000 residents
:09:03. > :09:07.confronted riot police outside local government officers. They
:09:08. > :09:17.have refused to accept insurances that there was no leak at the
:09:18. > :09:21.
:09:21. > :09:23.factory. Looking at the market we have really wild swings.
:09:23. > :09:27.have really wild swings. We saw some dramatic losses for the
:09:27. > :09:37.We saw some dramatic losses for the Dow. Market were able to recoup
:09:37. > :09:59.
:09:59. > :10:03.Dow. Market were able to recoup those losses. That's it from me.
:10:03. > :10:08.Here in the UK, the Prime Minister is to announce a review of every
:10:08. > :10:18.aspect of the government's policy in response to the right across the
:10:18. > :10:18.
:10:18. > :10:22.UK. Mr Cameron spoke of the need for a social fight back.
:10:22. > :10:28.A week after England was engulfed by some of the worst rioting in
:10:28. > :10:34.many decades, David Cameron and L - - Ed Miliband went head-to-head on
:10:34. > :10:38.how to stop the violence happening again. This was Mr Cameron in
:10:38. > :10:42.Croydon last week. In a speech later this morning he talked about
:10:42. > :10:50.the slow motion moral collapse in parts of the country. He said this
:10:50. > :10:57.has been a wake-up call for the country. He promises to meant what
:10:57. > :11:01.he calls a broken society. He adds, I will not be found wanting. Ed
:11:01. > :11:07.Miliband are said to the people he met after the riots want a real
:11:07. > :11:12.change. He said that policies needed to be thought through
:11:12. > :11:16.otherwise they would not solve the problem. He renewed calls for a
:11:16. > :11:21.public inquiry. He also said there has been too much prime -- finger-
:11:21. > :11:25.pointing at the police. Theresa May has been accused of criticising the
:11:25. > :11:29.police and interfering too much in their work. She says that she has a
:11:29. > :11:33.duty to set a framework. We need to ensure that the police have the
:11:33. > :11:39.backing for what they are doing and that we make sure they know what
:11:39. > :11:42.the public expect of them. senior police officers and
:11:42. > :11:48.politicians will need to set their differences aside as they sit down
:11:48. > :11:55.face to face for another emergency committee meeting.
:11:55. > :12:05.Coming up at six o'clock: We will be here with breakfast. They will
:12:05. > :12:05.
:12:05. > :12:09.have all the day's business, news and sport.
:12:09. > :12:14.You are watching BBC World News. Here are the headlines: Syrian
:12:14. > :12:19.government forces have attacked democracy activists. A resident of
:12:19. > :12:29.the town it told us about the army is stormed to residential
:12:29. > :12:36.
:12:36. > :12:43.neighbourhoods. At least 28 people were killed.
:12:43. > :12:47.This has come just after a crackdown that went on in another
:12:47. > :12:53.city the Syrian government is bombarding city and the City again.
:12:53. > :12:58.They are shooting anything that moves. The situation is really
:12:58. > :13:03.critical. We do not have a full information about what is going on.
:13:03. > :13:07.Hosni Mubarak is expected back in a Cairo court shortly. He is accused
:13:08. > :13:13.of corruption and killing hundreds of protesters in the uprising
:13:13. > :13:18.earlier this year. Human Rights Watch has accused Somalia's warring
:13:18. > :13:22.parties of contributing up to the humanitarian catastrophe that is
:13:22. > :13:28.ravaging the country. It is calling for all sides to end abuses against
:13:28. > :13:33.civilians and injuring access to aid.
:13:33. > :13:36.The Norwegian gunman who shot 68 people has been brought back to the