:00:13. > :00:19.see widespread antibiotic-resistant bacteria. It is time for World
:00:19. > :00:25.Business Report. This is World Business Report. The headlines:
:00:25. > :00:32.Will Italy avoid a financial bail- out with a promise from Silvio
:00:32. > :00:42.Berlusconi to go? We assess what is at stake. Inflation in China has
:00:42. > :00:45.
:00:45. > :00:51.eased to a five-month live. Food price rises slowed down. -- five-
:00:51. > :00:55.month low. As you have been hearing, he has promised to go. Silvio
:00:55. > :01:00.Berlusconi is saying only after the Italian parliament has approved
:01:00. > :01:04.plans for economic reform. In the meantime, investors have been
:01:04. > :01:10.punishing the country for its high debt. On Tuesday the cost of
:01:10. > :01:20.borrowing for the Italian government hit a record high. 6.67
:01:20. > :01:20.
:01:20. > :01:25.%. It has now fallen back slightly in Asia trade this morning. Thank
:01:25. > :01:35.you for coming in. To a degree, for now, the markets have got what they
:01:35. > :01:37.
:01:37. > :01:41.have -- wanted? It is going to be a very short window of opportunity.
:01:41. > :01:47.We have seen the stock market's rally yesterday and this morning on
:01:47. > :01:51.the back of good news with a new great coalition government in place
:01:51. > :01:56.and now the news that Berlusconi is going to force the Italian
:01:56. > :02:03.parliament to accept austerity. The problem for the euro is a long-term
:02:03. > :02:11.issue. What really changes? We do not even know if Silvio Berlusconi
:02:11. > :02:19.is going. Well he just force another election? -- will he. The
:02:19. > :02:24.reaction of the bond market will be harder than the stock market.
:02:24. > :02:29.have seen the cost of borrowing come down a little bit. One thing
:02:29. > :02:35.I'm hearing over and over again, record highs, if it reaches 7%,
:02:35. > :02:40.that is the point where Ireland and Portugal need a financial bail-out,
:02:40. > :02:45.is that where we are going? That is pretty major because the Italian
:02:45. > :02:49.economy is so large. You are absolutely right. There is nothing
:02:49. > :02:56.written in stone that says when a country gets to a certain level
:02:56. > :03:01.that is the crisis point. I think the market is assuming the worst
:03:01. > :03:07.about Italy and wants to be convinced otherwise. What could
:03:07. > :03:11.convince them that things will get better? What is there to stop Italy
:03:11. > :03:17.it from going to financial meltdown? The main thing is this
:03:17. > :03:24.European bail-out fund. Unfortunately, that is not fully
:03:24. > :03:32.formed yet. It is certainly not large enough. It is a bit like the
:03:32. > :03:38.Titanic, it is sailing into the icebergs with no lifeboats. The
:03:38. > :03:42.markets are saying that is not going to work. If recede the
:03:42. > :03:51.European Central Bank promising unlimited liquidity to the
:03:51. > :04:00.Financial Fund to buy bonds, that may change things around. -- if we
:04:00. > :04:04.see. The key is the financial stability fund having the firepower
:04:04. > :04:10.to see through a meltdown? It is one of the critical aspects. What
:04:10. > :04:15.are the prospects for Italy itself? Italy has had low growth for the
:04:15. > :04:21.last ten years. How do they turn that around? That is a long-term
:04:21. > :04:31.structural change. Thank you for clarifying things. We will see you
:04:31. > :04:33.
:04:33. > :04:38.again and --. Let's take a look at Greece. The make-up of a coalition
:04:38. > :04:43.government will be announced, that will be announced today. No signs
:04:43. > :04:53.of progress yet. Prime Minister George Papandreou has agreed to
:04:53. > :04:59.
:04:59. > :05:05.step down. He will meet the Greek precedent in a few hours' time. --
:05:05. > :05:11.Greek President. China's inflation has eased to 5.5% in October. That
:05:11. > :05:15.is the third month in a road it has calmed down. That shows a
:05:16. > :05:20.reasonably controlled slow down. It is a long way from the official
:05:20. > :05:27.target of 4% for inflation. Let's speak to our correspondent in
:05:27. > :05:34.Beijing. We are looking at some good news this morning. A relief
:05:34. > :05:40.for the authorities? Exactly. It will be welcomed by the authorities.
:05:40. > :05:47.Inflation is down for the third successive month. It is still above
:05:47. > :05:52.4%, the government's target. Food inflation remains above 10%. That
:05:52. > :05:57.is a politically explosive point. Generally speaking, it is good
:05:57. > :06:02.economic news from China on this front. It will allow the
:06:02. > :06:06.authorities more room for manoeuvre to stimulate more economic growth.
:06:06. > :06:13.If that were to happen, it could be a move that would be welcomed by
:06:13. > :06:19.the West. It is looking to China for global economic growth. It is
:06:19. > :06:25.very important for China to have that movement. The European trading
:06:25. > :06:29.market is looking very weak. That is its largest trading partner.
:06:29. > :06:34.That is right. China is the largest exporter in the world. What happens
:06:34. > :06:39.in Europe affects here. Authorities are concerned about that. They are
:06:39. > :06:44.also concerned about the property market. Property prices have
:06:44. > :06:48.started to dip in the last couple of months. There is concern about
:06:49. > :06:55.the extent of bad loans across the country. They were issued by state
:06:55. > :07:00.banks. You are right in pointing out that the Chinese authorities in
:07:00. > :07:05.the long run want to stimulate the domestic consumption. They want to
:07:05. > :07:10.do that because they are so reliant on exports to the West. That is a
:07:10. > :07:17.process that will take many years. Thank you are very much indeed.
:07:17. > :07:25.That story has boosted the markets in Asia today. Let's move on to the
:07:25. > :07:29.international Energy Agency, says gloomy forecast last month, the
:07:29. > :07:35.debt crisis in the eurozone has barely been out of the headlines.
:07:35. > :07:40.We take a look at how the turmoil in some European countries may hit
:07:40. > :07:46.the global energy market. While economic growth remains fragile,
:07:46. > :07:51.particularly with the eurozone's debt crisis, global oil demand has
:07:51. > :07:57.increased at a slow and steady rate. As austerity measures are imposed
:07:57. > :08:02.across the eurozone, economies are slowing. The demand for energy is
:08:02. > :08:06.falling. The question is, to what extent that will have an effect on
:08:06. > :08:11.energy pricing in the long-term? Some experts say even though demand
:08:11. > :08:17.may slay in the near term, the outlook is still one of rising
:08:17. > :08:25.prices and limited supply. -- make it slow. The outlook will depend
:08:25. > :08:30.what happens in China. If China has a hard landing, that could have a
:08:30. > :08:34.significant impact on prices and the future of oil. Most people are
:08:34. > :08:44.anticipating that China will continue to grow at a strong break
:08:44. > :08:45.
:08:45. > :08:49.and we will see oil demand growth. -- strong rate. Investment in oil
:08:49. > :08:57.has to be supported by higher prices because the sources of oil
:08:57. > :09:02.are becoming more expensive to produce. Oil prices hit a 2011 high
:09:02. > :09:08.in April. As the conflict in Libya shut down supplies. Even though the
:09:08. > :09:13.war in Libya is over, prices are expected to continue rising over
:09:13. > :09:19.the long-term. The risk of unrest remains a concern. Especially if it
:09:19. > :09:23.affects major exporting countries. Any unexpected drop in oil supply
:09:23. > :09:33.could lead to a surge in energy prices. That could tip the global
:09:33. > :09:38.economy back into recession. One company is doing well in Europe
:09:38. > :09:48.despite the financial crisis. This company has seen a 37% jump in
:09:48. > :09:51.
:09:51. > :09:57.recurring and -- earnings. Operations in the region are very