:00:15. > :00:22.Korea but has cautioned that any provocation would be dealt with.
:00:22. > :00:30.Welcome to World Business Report. The headlines: China's factories
:00:30. > :00:40.rebounded in December but will this be another year of slow growth?
:00:40. > :00:46.
:00:46. > :00:52.Will 2012 break the euro or make it stronger? 2012 has started up with
:00:52. > :00:58.some encouraging economic news from China. Manufacturing activity rose
:00:58. > :01:02.in December, defying expectations of a decline. The index of
:01:02. > :01:08.Purchasing Managers shows an expansion of business in December
:01:08. > :01:13.after a decline in November, which had added to fears that China's
:01:13. > :01:22.economy was slowing down. Those concerns were exacerbated when a
:01:22. > :01:32.private survey showed that industrial activity was declining.
:01:32. > :01:32.
:01:32. > :01:38.Now, how important is the state had? -- is this information? Quite
:01:38. > :01:44.important. This is an indication that there is still major demand
:01:44. > :01:52.for China's clothing, electronics and other merchandise produced by
:01:52. > :02:00.the country's factories. One factor is that these products were high in
:02:00. > :02:04.demand during the Christmas product -- during the Christmas period. But
:02:04. > :02:11.beyond this month, analysts are not certain if this improvement in
:02:11. > :02:16.factory output can be sustained in the coming months. They say that
:02:16. > :02:21.despite his bounce back in December, China is continuing to be affected
:02:21. > :02:27.by external events like the eurozone crisis and the weak
:02:27. > :02:30.expansion of the US economy. However, if global economic
:02:30. > :02:39.problems continue to persist, the Chinese government has guaranteed
:02:39. > :02:48.steady growth in 2012 and will release was pro-growth policies
:02:48. > :02:54.such as an interest rate reduction. Things are still looking good for
:02:54. > :02:59.the Chinese economy despite 2011's slow down. What are the prospects
:02:59. > :03:04.for 2012? Many economists are still
:03:04. > :03:12.predicting China's economic growth will still be faster than any other
:03:12. > :03:22.Asian economy, however, that growth will be at its lowest level for
:03:22. > :03:23.
:03:23. > :03:28.over ten years. No-one is expecting any kind of difficult landing. From
:03:28. > :03:34.the likes of the Asian Development Bank and global investment banks,
:03:34. > :03:40.the forecast for the Chinese economy will expand between 7.9%
:03:40. > :03:50.and 8.5% in 2012. There is one thing that you can say
:03:50. > :03:50.
:03:50. > :03:56.about 2011 - it was better than 2010. That is how one financial
:03:56. > :04:02.analysts summarised the situation in the eurozone. 2011 was the year
:04:02. > :04:06.in which European leaders stopped the eurozone crisis from spreading
:04:06. > :04:11.further and undermining the entire European project.
:04:11. > :04:19.Europe is coming together amid the crisis. The path to were overcoming
:04:19. > :04:26.this remains a long and difficult but -- to overcoming this remains a
:04:26. > :04:32.long and difficult but at the end, Europe will remain stronger.
:04:32. > :04:42.Some in London's financial district are anticipating some kind of a
:04:42. > :04:53.
:04:53. > :04:59.disintegration of the euro. The party is over for the eurozone.
:04:59. > :05:06.All the signs at his amusement park are that some defaults might lie
:05:06. > :05:11.ahead - ordinary or otherwise. Like the single currency, this place
:05:11. > :05:15.represents a grand and a unified vision of Europe. But no amount of
:05:15. > :05:20.treaty change and fiscal discipline can alter the fact that some
:05:20. > :05:26.countries cannot afford their repayments. 2012 is the year when
:05:26. > :05:31.we should anticipate some countries to leave the euro. According to
:05:31. > :05:35.City of London commentators, this is a continuing horror story.
:05:35. > :05:42.Greece is disappearing as an economy far too quickly for it to
:05:42. > :05:49.be saved and it can only be saved outside of the euro. Will others
:05:49. > :05:56.have to leave as well? It seems unlikely that Portugal will survive.
:05:56. > :06:02.And can they keep Spain and Italy? I am almost at the end of a visit
:06:02. > :06:12.to an amusement park at a time when, like me, the euro is on the edge of
:06:12. > :06:13.
:06:13. > :06:19.a precipice. It is safe to say that it will be a bumpy ride of.
:06:20. > :06:27.I am not a profit but it is safe to say that as soon as one country
:06:27. > :06:32.leaves the eurozone, it will be a threat to the EU. The entire
:06:32. > :06:39.European project is in danger. Everyone is keeping a close watch
:06:39. > :06:49.on Italy, the next weakest link. If it cannot be saved from default,
:06:49. > :06:51.
:06:51. > :06:58.Europe's entire banking system will be in uncharted waters.
:06:58. > :07:01.Now, his 2012 the make or break here for the eurozone? Certainly
:07:01. > :07:08.this is the year for difficult decisions. If 2012 is remembered
:07:08. > :07:18.for anything, it will be that no decision was made. -- If 2011 is to
:07:18. > :07:19.
:07:19. > :07:22.be remembered. Is it that the core members of the
:07:22. > :07:29.eurozone are there but the smaller members will have to operate under
:07:29. > :07:33.a different umbrella? Yes and it will not be an easy transition but
:07:33. > :07:41.it can be done. A country like Greece would benefit from having a
:07:41. > :07:45.devalued currency and would then be able to compete with its neighbours.
:07:45. > :07:50.The is governments have adopted or austerity measures, which on the
:07:50. > :07:54.one hand, are dealing with the issue of spending, but are not
:07:54. > :08:03.helping growth. Are you saying that having their own local currency
:08:03. > :08:09.would help? Precisely. We would end up with the Northern euro, which
:08:09. > :08:16.would be similar to the Deutschmark. That would be starve. Then there
:08:16. > :08:22.are the other currencies defaulting to this the weaker kind of euro.
:08:22. > :08:32.Like Euro light, almost. Then they would be allowed to start regrowing
:08:32. > :08:33.
:08:33. > :08:43.their economies over time. Thank you.
:08:43. > :08:50.
:08:50. > :08:56.Exxon Mobil has suffered a blow, forced to pay a hefty compensation
:08:56. > :09:01.bill to the state of Venezuela. Nigerians are facing a steep rise
:09:01. > :09:05.in the price of petrol after the government put a stop to petrol
:09:05. > :09:14.subsidies. The government says that it will save $7 billion per year.
:09:14. > :09:16.Trade unions want the decision reserved and are calling for
:09:16. > :09:24.strikes. The latest mission impossible movie
:09:24. > :09:30.has been named the top film in America for the second year in --