:00:03. > :00:13.They suspect has been taken into custody.
:00:13. > :00:23.
:00:23. > :00:31.This is bold business report. Get a grip and a deficit column Spain's
:00:31. > :00:37.finance minister gets a friendly warning from Brussels.
:00:37. > :00:40.The United States is set to file a complaint against China and the
:00:40. > :00:45.more trench -- World Trade Organisation changing restrictions
:00:45. > :00:55.on exports. Battle lines from over a
:00:55. > :00:56.
:00:56. > :01:01.transaction tax. The Casey's is as an attack on the City of London.
:01:01. > :01:06.Eurozone finance ministers meeting in Brussels have signed off a
:01:06. > :01:10.second bailout Bassett -- package. It enables the first payment of 130
:01:10. > :01:16.billion euros to be made this month. Many fear it will not be the last
:01:16. > :01:25.bail-out Greece needs. For now the country's is off the critical list.
:01:25. > :01:34.The concern has switched to Spain. Spain's budget deficit in 2011 was
:01:34. > :01:41.8.5 % of its GDP. That is of the 6% target. It is 19 billion euros in
:01:41. > :01:44.the red. Equivalent to the entire bailout given to Portugal. Spain's
:01:44. > :01:49.Finance Minister may have been strangled by a chief finance
:01:49. > :01:54.minister in a friendly way but he agreed on Lissa targets for
:01:54. > :02:03.overspending this year. That has triggered alarm bells for some over
:02:03. > :02:06.commitment for tackling the debt crisis. It was nice to see any
:02:06. > :02:11.little bit of you may guess -- yesterday. If you talk us through
:02:11. > :02:16.the timeline now that Greece is looking like it may get its money.
:02:16. > :02:21.What will happen next? It looks like we have some closure and a
:02:21. > :02:30.solution on Greece for the meantime. It is only for the meantime. They
:02:30. > :02:39.may have a whole series of new speed bumps coming up from Europe.
:02:39. > :02:44.The Spain story comes slightly down. Spain is a crisis that is going to
:02:44. > :02:49.happen at some point simply because Spain's economy will not be able to
:02:50. > :02:54.boost growth. It will not be able to continue austerity and cut down
:02:54. > :03:00.budget deficits unless something else changes. The immediate hurdles
:03:00. > :03:05.for the Europe will be Portugal. The market has seen yields in
:03:05. > :03:11.Portuguese debt widen dramatically. We think that Portugal is heading
:03:11. > :03:15.towards some kind of restructuring like Greece has just done. Then we
:03:15. > :03:23.had the French elections coming up. The French elections are very
:03:23. > :03:27.significant. If Sarkozy loses the election and we have deep new
:03:27. > :03:32.French President threatening to renegotiate the fiscal stability
:03:32. > :03:37.pacts it could cause problems for Angela Merkel. She has been using
:03:37. > :03:47.it to persuade German voters to support what she has been doing in
:03:47. > :03:47.
:03:47. > :03:50.keeping the River Wey. After that we worry more about Spain and Italy.
:03:50. > :03:57.They have both benefited dramatically from the government
:03:57. > :04:02.given from the ECB. During this meeting as well they have been
:04:02. > :04:05.rubber-stamping the bail-out for Greece. The battery Affairs
:04:05. > :04:10.Commission has said they hope they will reach an agreement on
:04:10. > :04:15.increasing the size of the bail-out fund this month. That is the keep.
:04:15. > :04:20.If you say it all those elements arrowhead, Portugal, uncertainty
:04:20. > :04:24.about France, Spain, Italy, the bailout needs to be bigger.
:04:24. > :04:28.Everyone says it does need to be bigger. For Germany to agree and
:04:28. > :04:35.had more money to the bail-out fund requires all these other things to
:04:35. > :04:39.happen. Everybody needs to stick to a tight budget agreements. The fact
:04:39. > :04:44.that Spain is able to get a compromise yesterday and the
:04:44. > :04:52.compromise they got was the EU asked them to come in with a 4%
:04:52. > :04:57.target. They said we can make 5.8%. Based at the difference. It is a
:04:57. > :05:07.complete fudge. That is the way the euro works. It will make it more
:05:07. > :05:09.
:05:09. > :05:14.difficult for Angela Merkel to get the approval. We will talk to you
:05:14. > :05:18.in ten minutes for a look at today's newspaper stories. Let's
:05:18. > :05:24.have a look at the other element on the agenda that could cause a
:05:24. > :05:30.problem. The proposed financial transaction tax. The UK has made
:05:30. > :05:35.its position clear. It is expected to stress strong opposition today.
:05:35. > :05:45.He argues that it attacks a vital point of interest in the City of
:05:45. > :05:50.London. The financial sector bears some of the blame for new reports
:05:50. > :05:56.back economic downturn. So we should pay more. That is the
:05:56. > :06:01.argument behind this tax. Britain has been determined to block it.
:06:01. > :06:08.The City of London is the largest financial centre in Europe. In a
:06:08. > :06:14.recent Impact Assessment the European Commission argued that
:06:14. > :06:20.companies are here would pay 71% of all the revenue raised. That
:06:20. > :06:25.compares to 16% from Germany and 17% from France. No wonder the
:06:25. > :06:30.government is opposed to that. They fear that financial institutions
:06:30. > :06:36.would desert London for other continents. They may head to Asia
:06:36. > :06:42.or North America. Financial institutions will be able to bring
:06:42. > :06:48.their prices down to match that. The EU financial institutions will
:06:48. > :06:52.look for other places to do their business. At the meeting on Tuesday
:06:52. > :06:58.it is expected that George Osborne will try and have the tax pushed
:06:58. > :07:03.off EU's agenda. He will argue it has no right to impose fiscal
:07:03. > :07:12.policy on member states. He will say that we do not want this
:07:12. > :07:17.introduced. It could be Ireland, Luxembourg, maybe even some of the
:07:17. > :07:24.others that pulsate it is not a good idea. It introduces a European
:07:24. > :07:29.dictatorship. Member states on the hall a very opposed to that. It is
:07:29. > :07:35.estimated that the tax could raise 57 billion euros a year. That makes
:07:35. > :07:41.it hard for many politicians to get rid of the idea. President Sarkozy
:07:41. > :07:45.has made it a pledge to introduce one for France. In Germany the
:07:45. > :07:55.opposition parties at telling at Angela Merkel to push through the
:07:55. > :07:56.
:07:56. > :08:03.plant. -- plan. A fight over red earth exports has
:08:03. > :08:10.stepped up a gear. China is on a collision course with America,
:08:10. > :08:19.Japan and the youth. The Bramham also used in all kinds of products.
:08:19. > :08:25.Tell us more about this latest in the long saga? It is the latest.
:08:25. > :08:29.Another trade battle between the United States and China. Americans
:08:29. > :08:33.will filed the complaint later today with the world trading body
:08:33. > :08:41.challenging the mainland's restrictions on rare earth exports.
:08:41. > :08:46.The European Union and Japan will pack up United States on this case.
:08:46. > :08:49.Many of these are critical for the manufacturing of hi-tech products.
:08:49. > :08:54.The US his argument that by limiting exports China which
:08:54. > :08:58.produces more than 95% of the red earth metals and the world is
:08:58. > :09:03.driving up prices and giving Chinese companies an unfair
:09:03. > :09:09.advantage by increasing production costs for American companies. There
:09:09. > :09:15.are also concerned that Beijing has implemented these codes to ensure
:09:15. > :09:19.that these elements remain low within China. China says that it is
:09:19. > :09:27.to ensure that There is no environmental damage caused. Thank
:09:27. > :09:33.you. A look at the markets quickly. A slight gain for Japan and
:09:33. > :09:38.elsewhere. Gains across the board. US retail sales figures out today.