30/08/2011 World Business Report

The eyes of the latest headlines. - - those are the latest headlines.

Now it is time for World Business Report. The headlines: Italy test

the bond markets one day on from dumping key parts of its austerity

plan. Looking for volume, Glory Hole's investors wait to find out

if the world's biggest cut -- cosmetics group can continue its

sales. In Chinese investors plan to buy land in either -- Iceland is

causing controversy. It was always going to be a big

test of the bond markets. Italy is selling between eight and 6 billion

euros of long-term debt. It is the first such auction since the

European Central Bank began buying Italian bonds on the secondary

market earlier in the month in order to force down the interest

rate demanded by investors. The ECB is barred from bright -- buying

directly from the Italian government, the sale is the first

chance to see whether its assets will cause the borrowing costs to

us all. It is unfortunate timing. The government rolled back on its

austerity programme. Ministers dropped a new tax on higher earners,

scaled back cuts to government funding and made no announcement on

the VAT a sales tax. We speak to the head of global research at a

bank. Let's talk about investors' confidence in Italy. Going to the

bond market, rolling back on those austerity measures. That does not

exactly inspire confidence. absolutely doesn't. It was always

going to be in the detail. It suggests it will be a difficult run.

The Italian government has been changing its plans. The plan was

brought together in just a few days. The ECB will be a backstop. The

plan still needs approval. It is not expected to come online until

early October, if at all. In that grand bargain, Italy's side would

be austerity measures. They seem to be reneging on that. It is quite

convoluted. Tax increases will still be 45 billion. It is short on

detail. How will they achieve it when part of it is abolishing

government systems. It requires a two-thirds majority. In some ways

it really is saying that they have to look at the austerity measures.

They were cobbled together. The important thing is to kick the

Government going. Having an election would create more on --

uncertainty. That is true. If you are a business in Italy you have

seen an overhaul three times. That is difficult. Think constructively.

One of the be problems in Italy has been a lack of structural reforms

in the past decade. It would be encouraging if there was some

progress in that area. Talks have not been focused on that. Where

does it put the ECB? It made a deal with Italy. Italy seems to have

reneged on the deal. Where does it put the ECB now? In a difficult

spot. It is dangerous to assume the ECB would just be standing around

every corner. This is the Europe's back. When the heat goes up

massively, they will stand there. They will not let the 4th. But they

are going to facilitate a number of crisis to push Polly's made --

policy makers to take difficult decisions. Do not assume they will

be every where. Thank you. While the eurozone

continues to struggle, Brazil is taking steps to protect itself

against any collateral damage. To do so the government is increasing

the tabards for its budget surplus by $6.2 billion. The savings will

be made by cutting public spending. The finance minister it says it

should make far -- interest cuts possible.

Greece is to name and shame companies suspected of tax evasion.

The Finance Minister says companies accused of failing to pay sums of

over $218,000 will be identified on a website. He says there are plans

to name suspected individuals one's privacy protection officials have

been advised. The effort is designed to cut the spending

deficit as part of the country's bail-out deal.

Indeed a's economy is expected to have grown at its slowest pace

between the months of April and June. The GDP update is due out in

one hour. It dark -- he is expected that it will be expanded by 7.6 %.

That is below the forecast. The shortfall is being linked to a

slowdown in manufacturer gross and lacklustre consumption data.

-- manufacturing growth. Loreal's is expecting a 13% rise

for the first six months. The group has bucked the downturn and with

one minor exception, reported a rise in sales for every period

since 2005. But while the public appear to love its products,

advertising watchdogs are proving harder to please. Cosmetic

companies, the lorry of strategy has been to sell these luxury

brands in the Max market. In the last year, Laurier group saw an

increase in profits of over 10%. Analysts put this down to increase

in sales in emerging markets like East Asia as well as the so called

lipstick affect. People's apparent tendency to treat themselves to

more little items of luxury during a downturn. But in the latest

quarter, growth in sales has slowed to under 5% per annum. Sales in the

luxury end I doing quite well. Sales in the consumer and

professional products are a little bit lower. It feels like, like any

large globally distributed brand, they will be Fokker's of

hyperactivity. -- there will be pockets of hyperactivity. It looks

like it is lower than expected. Last month it had to withdraw to

mac and voter must -- advertisements in the UK. The

Advertising Standards Agency said their images had been overly

airbrushed and were mislaid in. As that damaged the company's

credibility? It would not cause a great deal of worry for them. I am

sure they will find a creative way to deal with the continuation of

that kind of campaign, bearing in mind some of the legislation that

applies. Recently, the billionaire areas to be a lorry our fortune

made headlines by offering to pay more takes to help President

Sarkozy balance the state budget. If the company had lost public

esteem it may have regained some through heard gesture.

One of China's richest property investors is causing controversy

with a plan to buy up 300 square kilometres of Iceland. He wants to

turn it into a tourism resort. We have more from Singapore. Who is

this man and what does he want to do with the land? He is a former

government official. He worked for it China's Central propaganda

department and the Ministry of Construction. He is reportedly

interested in buying the land for $9 million. Some are concerned

about the deal. Because of its close relations to the government,

people are wondering whether it is his personal interest or whether he

is acting on behalf of Beijing. It is a very important location

between North America and Europe. He is buying quite a large part of

ice land. It accounts for about 0.3% of the nation. Some people are

saying that it is way too large for what he is proposing to do with the

man, which is to build it into a tourism resort and golf course.

There have been many Chinese investors with a lot of money

buying up lots of land around the world. But sometimes it seems to

raised some concerns about what their real motivation is. We will

watch closely. The National Bank of Greece, the

country's biggest lender, reported second quarter results. Eyeless

forecast a $40 million loss. Investors will be interested to see

what it has to say about the planned merger of rivals Alfa Bank

and in Europe and, Hamas having failed to take over how far last

year. In the US be much watched SNB home a price index is out for June.

Last month it reported prices in the 20 cities surveyed were down

4.5% on last year. June's number is expected to be even larger. Later

the Fed releases the minutes from its last race setting meeting which

should give us a further insight into the discussion that led to the

promise to keep interest rates at a record low for at least two years.

Let's have a look at the market. These are how the Asian markets are

looking. Investors liked those strong consumer spending as we got

out of the US. They were happy about the merger with the banks in

Greece. They're happy about the appointment off of Yoshihiko Noda.

That's all of the business. A report on home ownership in

England says an entire generation is being locked out of the housing

market. The National Housing Federation says that the proportion

of people who own their own home is set to fall to below 64%, the

lowest level since the mid-eighties. In some parts of the country this

remains a pretty rare sight, a development with planning

commission agreed, new homes actually being built. It took years

for the site in bed for to get to the stage, where prospective buyers

can come to take a look. -- in Bedford. This woman cannot afford

one of these properties outright. She and her boyfriend at just

starting out as teachers, so she wants to buy a share of the house

and pay rent on the rest. The only answer for some trying to get a

toehold on the property ladder. The report describes a slow decline in

home ownership. Ten years ago 70% of people were living in properties

occupied by the owner. That is forecast to fall to wonder 64% by

2021. In London it will be much lower. -- to under 64%. More people

are renting. The authors of the report think owning a property will

only be possible for the wealthy. The National Trust says that

existing sites can meet housing needs without damaging the

environment. But in recent years the system has failed to deliver

anything like enough houses. The question is whether the significant

changes underway it will make a difference.

Coming up at 6 am, Simon and Kate will be here. They will have been

used, business and sport and they will be at a fairy-tale castle

where they are hoping spectacular graffiti will be allowed to stay

You're watching BBC World News. The headlines: Libya's rebel National

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members of the Gaddafi family who have fled to Algeria. The

whereabouts of Gaddafi himself still it is a mystery but Middle

East journalist thinks it is unlikely he will just disappear.

is a maniac. He would like to be in the spotlight. He would like to