:00:10. > :00:19.the city of Homs. -- the UN humanitarian chief. Time for World
:00:19. > :00:23.Business Report. Welcome to the programme. As Greece pores of the
:00:23. > :00:31.biggest sovereign debt will pave the way for a second
:00:31. > :00:37.rescue package. China's inflation rate falls sharply. More evidence
:00:37. > :00:47.of a major slowdown in the economy. Plans for an Asian premier airline
:00:47. > :00:49.
:00:49. > :00:53.collapse for Qantas. Greece is on the verge of clinching
:00:53. > :00:58.a second bail out this Friday after agreeing to the biggest sovereign
:00:58. > :01:03.debt restructuring in history. In 30 minutes, it will be revealed how
:01:03. > :01:13.many of the country's private creditors have agreed to swap their
:01:13. > :01:13.
:01:13. > :01:18.public bonds for new ones are worth 70% less. Reports overnight
:01:18. > :01:27.indicate the deal has been successful, with 95% of debt
:01:27. > :01:31.holders agreeing. Thank you for joining us.
:01:31. > :01:38.It appears that this deal will be going through but not without
:01:38. > :01:47.consequences. It is important to understand that
:01:47. > :01:53.these potential bonds are pricing around 20%. People are expecting
:01:53. > :02:03.that this is a step in the right direction but there will be more to
:02:03. > :02:05.
:02:05. > :02:12.come. The target of 120 % debt-GDP for Greece is for 2020. Are you
:02:12. > :02:17.predicting another bail out? Along the road, it is likely. What is
:02:17. > :02:24.important is to understand exactly how this will be done. What the
:02:24. > :02:31.ratings agencies will say if that is activated and what the impact on
:02:31. > :02:36.the market will be. The market for Greece is quite small but will
:02:36. > :02:45.people stop worrying about Italy and Spain are? This 95% threshold
:02:45. > :02:50.is really important. It was never really all about Greece, was it? It
:02:50. > :02:55.was about ring-fencing the problem so it did not affect Spain, Italy
:02:55. > :03:00.and Portugal. Has that been effective? We are not there yet but
:03:00. > :03:04.we have made a lot of progress, injecting a lot of liquidity in the
:03:04. > :03:09.banking system and alleviating the pressure on those banks. Investor
:03:09. > :03:15.confidence has returned to a large extent. The other thing we are
:03:15. > :03:20.forgetting is that a large part of Europe, like Germany, is doing very
:03:20. > :03:25.well. That will help with European health overall. However, European
:03:25. > :03:29.fragmentation is still apparent. That is, between the south and the
:03:29. > :03:35.north. China has seen a drop in the rate
:03:35. > :03:42.of inflation in February - evidence of a slowdown in the economy. It is
:03:42. > :03:50.lower than what many were expecting. It is the lowest rate of inflation
:03:50. > :03:55.for almost two years. Thank you for joining us.
:03:55. > :04:01.What are we to read into these inflation figures? Is this a signal
:04:01. > :04:05.that the Chinese economy is slowing down?
:04:05. > :04:10.We have got to be careful about the interpretation of Consumer Price
:04:10. > :04:14.Index inflation. In a financially repressed system like that of China,
:04:14. > :04:20.it is fairly standard that rapid monetary growth is associated not
:04:20. > :04:25.so much with Consumer Price Index inflation but asset inflation. To
:04:25. > :04:28.that end, it is good at this inflation has come down. It gives
:04:28. > :04:33.the central bank more room to manoeuvre and we were all expecting
:04:34. > :04:37.it to happen. The distinction between consumer
:04:38. > :04:46.price inflation, what people pay for products in shops, and asset
:04:46. > :04:51.price bubbles. Yes. That is the real concern.
:04:51. > :04:55.Monetary growth has been very rapid, credit growth is slowing but is
:04:56. > :05:01.still quite rapid. We are seeing huge amounts of investment in areas
:05:01. > :05:07.that are probably not economically viable. But with such low interest
:05:07. > :05:11.rates, it is difficult to prevent. What most people seem to be
:05:11. > :05:18.concerned about is the prospect of what people are calling a hard
:05:18. > :05:21.landing - a sudden drop of the growth rate. Is that a possibility?
:05:21. > :05:27.It is obviously a possibility depending on what happens in Europe
:05:27. > :05:32.but it is unlikely, I believe. I am more concerned about a long
:05:32. > :05:35.slowdown of growth over many years, which I think is more likely. If
:05:35. > :05:41.you can predict what will happen in Europe, you will have a better idea
:05:41. > :05:46.of how rapidly growth will slow in China this year and the next year.
:05:46. > :05:52.Thank you. Qantas has called off talks with
:05:52. > :05:59.Malaysia Airlines to set up an Asian premier career.
:05:59. > :06:06.What has happened? As he is said, essentially the
:06:06. > :06:11.talks have broken down. It has had a bad impact on Qantas shares today,
:06:11. > :06:16.falling as much as four descent. Qantas says the two could not agree
:06:16. > :06:22.on commercial terms. They had announced plans to start this joint
:06:22. > :06:27.venture airline in Asia last August and this was an attempt to try to
:06:27. > :06:32.turn around its international arm, which is currently making a loss.
:06:32. > :06:37.This was part of the five years strategy to revive international
:06:37. > :06:43.operations. We know that Qantas lost $200 million in the 2011
:06:43. > :06:48.financial year. The collapse in talks comes just as Malaysia's
:06:48. > :06:51.national carrier announces plans to launch its own premium regional
:06:51. > :06:57.airline in April. That is part of its restructuring plan after
:06:57. > :07:00.suffering its biggest loss in history in 2011. Qantas's chief
:07:00. > :07:05.executive said Qantas would continue to explore opportunities
:07:05. > :07:10.in the region through alliances and joint ventures. The airline's
:07:10. > :07:14.attend to become more profitable by setting up an airline outside
:07:14. > :07:20.Australia had angered a lot of workers, leading to a strike and a
:07:20. > :07:26.grounding of the Qantas fleet. This news is not likely to help Qantas's
:07:26. > :07:30.international operations. America's job market is slowly
:07:30. > :07:36.repairing itself. Companies have added 200,000 workers to pay roles
:07:36. > :07:40.in recent months. The official figures hide millions of workers no
:07:41. > :07:50.longer counted as unemployed and even more who are working less
:07:51. > :07:51.
:07:51. > :07:59.hours than they want. A rich colour suits me best?
:07:59. > :08:05.These sunglasses were created by a couple inspired by the military.
:08:05. > :08:09.The business has taken off and they are adding whole people.
:08:09. > :08:14.We have been expanding nationally. Many people are buying and we need
:08:14. > :08:22.more help with sales. We are bringing on a series of sales
:08:23. > :08:27.representatives to represent us too small boutiques around the country.
:08:27. > :08:32.Small businesses created 50% of all the jobs last month in America.
:08:32. > :08:37.Selling sunglasses to baby might not be an industrial powerhouse of
:08:37. > :08:42.a Business but put together with all the other small companies in
:08:42. > :08:45.America, this will pull the US out of an economic slump. It looks like
:08:45. > :08:49.the unemployment picture is improving.
:08:49. > :08:53.While the headlines look good, or digging deeper and there are
:08:53. > :08:58.millions of Americans who are out of work and no longer officially
:08:58. > :09:06.counted as unemployed. Many remain angry at the job
:09:06. > :09:11.situation like these protesters. Teachers are being fired. We have
:09:11. > :09:17.got to bring money into education, we have got to build a middle class,
:09:17. > :09:21.health companies create jobs. This recruitment expert says there
:09:21. > :09:25.has been a huge change in the labour market.
:09:25. > :09:29.Three it is better than it was but there is still very much a two Tear
:09:29. > :09:34.labour market. People with skills in education and those who do not.
:09:34. > :09:39.Those who do not are being left behind.
:09:39. > :09:46.That is the Disconnect currently in America. The jobs market is
:09:46. > :09:51.improving but millions of Americans remain out of work.