27/01/2012 World Business Report

BBC World News. Let's bring you right up today with all the news

Welcome to World Business Report. Shaking off the gloom from Europe.

US growth may have hit its fastest I am in Davos. Where the head of

the European Central Bank, Mario Draghi, and also the US Treasury

Secretary Tim Geithner, are due to speak and they will try to persuade

delegates that recovery is just around the corner. And in Asia,

Samsung Electronics have reported Welcome to the programme. Despite

the gloom hanging over Europe where much of the region is in recession,

the world's biggest economy is powering ahead. Figures out later

are expected to confirm US GDP growing at its fastest pace in a

year and a half. Growth in the final quarter of 2011 is likely to

come in at 3%, up sharply on the previous quarter, that has been

driven by a fall in unemployment and stronger consumer spending over

the holidays. But will it last? Sparks are flying at this

manufacturing firm in New Jersey. Here, they make hardware for US

naval ships. They are part of a wave of manufacturers who are

supporting otherwise lacklustre economic activity. In the 4th

quarter of 2011 we were very busy. We worked extensive overtime in

order to make deliveries for our year end. We think the

manufacturing climate in New Jersey and the West is pretty strong.

Manufacturing makes up only a fifth of the US economy but it has been

resilient -- the US. American manufacturing companies have been

at the heart of the economic recovery here since the end of the

great recession. But many wonder whether a strong manufacturing

sector is enough especially given the troubles in Europe, the lack of

confidence of US businesses, and even the continuing problems in the

US housing market. Not to mention struggling US consumers, whose

purchases made up to 70% of US growth. And the burst of activity

at the end of 2011 may well be short lived. We do expect growth to

continue to slow over the cost of the year. We are expecting by the

4th quarter of this year, it will be near 1% -- the course of.

for welder Jason, a manufacturing job is skilled worker with

prospects in an economy with high unemployment and insecurity. It is

not easy work but it is a steady job and steady work. While

manufacturers may be doing well the rest of the economy is still

The US Treasury Secretary is one of the big names speaking at the World

Economic Forum in Davos later today. He will be debating the impact of

the eurozone crisis on the US economy. We will also hear from key

European policy makers including Mario Draghi, the head of the ECB.

Hello, it is all yours... Hello. Thanks very much. It is going to be

a day focussing certainly on the eurozone crisis and the impact it

is having around the world. There are going to be discussions about

the Chinese economy with a very strong message saying that the

eurozone crisis is really having a very detrimental effect on their

businesses and on economies right around the world. They feel now

that Europe is daring to muddle through this rather than make any

dramatic steps to change it -- Europe is going to. We are hearing

from Tim Geithner today and joining me now is and economists, very

eminent economists, and I ask you, how does the US deal about the

eurozone crisis? The US businesses, the politicians, are very

frustrated that this crisis has not been dealt with in a big way in a

final sort of way that it continues to drag on. But as you were saying

things have calmed down quite a bit so in that sense there may be

breathing space here which is good news. From a US perspective on its

economy, at the moment not many people are talking about debt but

that will have to be dealt with after the election. 20 twirl is

going to be a pretty good year for the US -- 2012. But in 2013 they

will have a huge fiscal problem they will have to deal with.

Everybody knows nothing will happen before the elections in November

but after that big decisions will have to be made. The political

climate in the US is still a pretty bad one so I am worried for after

2013. The economy is strong enough, though? We think the Fed might be a

bit too conservative, we are looking towards 2.5% growth, not

great but better than Europe. you think the economy will stall

again next year? I don't think so. A lot will depend on the fiscal

decisions. Will they let the social security tax code back up again?

What about the Busch tax cuts? There is a lot of talk about China

and where they stand economically, what do you think about that?

has had a cook track record of engineering soft landings. Their

housing bubble in -- their housing bubble is beginning to deflate --

good track record. Thank you very much indeed. I had a rather amusing

moment last night when I was talking to some Chinese businessman

and I talk to them about the Euros in crisis, they said they did not

feel it was going to get worse but then it would not get better either

-- eurozone crisis. That pretty much sums things up over here.

Thank you for joining us. Samsung has reported a 17% jump in 4th

quarter profits to $3.5 billion. Let's go to Singapore. If we look

at these figures, pretty good figures on the face of it with

record profits, but they are given to invest $22 billion in new chips,

flat-screen TV is, on a time -- in a time when others are cutting

costs? Indeed, they are investing, they are defined the general trend.

In Davos, it has been said most companies are cutting back over

concerns over the eurozone crisis and the global slowdown. Record

earnings for October to December, the South Korean manufacturer

making a net profit of more than $3.5 billion, almost half of that

coming from its telecommunications business. A 17% jump for the same

period a year earlier. Net profit however was lower for the entire

2011, it was down by around 15%. I must say the outlook is not quite

as good this year due to the lingering uncertainties over the

global economy, which is why they are making to invest so heavily.

They will remain fairly robust mainly on sales of smart phones.

Although this is where it will continue to come up against Apple,

who they have being accused of stealing their patents. Earlier I

was told despite Samson's results they are still behind Apple. If you

count the profits Apple are way ahead and they are doing it on one

business, their computing and mobiles business. They are doing it

without having to invest huge stakes in fixed assets. The winning

business model looks like Apple's at the moment but Samsung is a very

strong and diversified player, and what is interesting is how they

continue co-operating even when they are having to compete and

sometimes going to court together to draw the lines more clearly