02/05/2012 World Business Report

row within the banking rules. Seizing power, Bolivia follows

Argentina's lead and nationalise is another Spanish company. --

nationalise us. Thank you for choosing us. Now, how

much is enough, and who should decide? The amount of money banks

keep on reserve is seen as crucial to averting a repeat of the lean

and Brothers collapse. Today European finance ministers hope to

thrash out new rules on bank capital, which would affect more

than 8,000 lenders, and if the rules are too strict, banks may be

forced to restrict lending Street firms and households. But if they

are too lax, it may not be enough to avert another financial crisis.

This situation is basically the rules that the EU is putting in

place ahead of the international rules coming into play at the

beginning of next year, isn't it? So what are they saying at the

moment that the standard should be in Europe? Well, at the moment, the

basic proposal is simply to implement the basil 3 rules which

come into force at the beginning of next year. That means a 7% capital

ratio for all banks concerned. It also means that we have special

rules for much larger, globally systemically important banks. They

must have much higher ratios. But 7% is the minimum for banks. And is

that double? All these banks across Europe, some of whom are exposed to

very difficult situations, like the Spanish housing market, can they do

this? They have to be able to, because banks certainly need more

capital. The risk taking needs to be in some such as reduced. Where

banks cannot do what, in the private market, it will probably

need to be complemented by public money. A sort of part

nationalisation. So it is certainly possible to do 7%. If it goes

higher than 7%, some countries may face financing needs they cannot

fulfil. Some are calling for more than 7%, big UK and Sweden. And

some are saying that they would be like to -- like to be able to set

rules in their own member countries. So tell us about that argument,

will they be able to solve those disputes? This is a very typically

European argument. Not just in banking, many product markets. We

have on the one hand a tendency that some countries fear that they

need more specific national rules, which are tougher than the general

consensus, and other countries which are saying that we should

have the same rules for all countries, so that our companies

can operate in all countries without having different regimes

everywhere. So now we have the argument between Britain and Sweden,

who have tougher rules, and what these rules to keep that banks save,

whereas other countries have more of a common market -- Common Market

argument, saying that we should all have the same rules. Well, we will

watch this space with interest, to see how they work their way through

this one. Thank you for coming in to give us your take on that event

taking place today. Let's not talk about these crisis

talks that are going on in Madrid, after a second Spanish firm was

seized by a Latin-American government. But Libya's military

seized the facilities of red electric international on Tuesday.

-- but Libya's the Bolivian President said he was nationalising

the power company. This follows a very similar situation of the

nationalisation of a subsidiary of reps or by the Argentine government

last month. As workers on Bolivia marched on

May 1st, that President decided to nationalise the electricity company.

It was owned by the Spanish electricity company Re E. Evo

Morales said Bolivia was taking control of its own resources, and

said that the company's Spanish owners had not invested enough

money back into the Bolivian based company.

TRANSLATION: To clarify for national and international opinion,

this company used to be ours, and we are now nationalising what used

to be ours. APPLAUSE. The two weeks ago, a similar message, from

another South America lead, about another Spanish owned company.

it was Argentina's President. That company looks set to use it -- the

loose 51% of its 58% stake in an oil company. Another Spanish victim,

after another popular national mood in South America. In commercial

terms, Y p f is a bigger loss, but Madrid now has two difficult

diplomatic dilemmas. It will not want to escalate the dispute. It

will be tried to get as much compensation as possible for the

two Spanish companies. It will also, through the European Union and

other allies, want to send clear signals that are of Latin-American

leaders should not follow suit. -- about Latin American leaders.

Ikea is investigating claims it used false lay-by in East Germany

to make its furniture during the 1970s and 1980s. -- Labour. An

investigation by a Swedish current affairs programme, due to be aired

tonight, will unveil secret police files from the East German Stasi.

The Swedish furniture group is the world's biggest furniture sell-off.

UBS is expected to announce more dismal earnings for the start of

the year. Jobs could also go as the group struggles to recoup losses

from last year's to billion-dollar rogue trading scandal. Last Tuesday

the port to reach an arm of the bank paid $27 million to settle

fraud allegations in the US. BSkyB unveils third-quarter

earnings to date. They will be the first set of results since James

Murdoch was forced to step down as chairman following the phone

hacking scandal at sister newspaper, News of the World. On Tuesday, UK

politicians announced that James' father, Rupert Murdoch, was unfit

to run News International, which had made a failed attempt to take

over BSkyB. Facebook has set the date for its

share sale. According to the Wall Street Journal, should be able to

buy a piece of the world's biggest social network from 18th May. The

group will start drumming up support for the share offer on

Monday. Mark Zuckerberg is trying to raise five no -- $5 billion from

the share market debut, which would value the group at $100 billion.

Now, as you have been hearing, the French presidential election moves

into its final stages, and the two remaining candidates are to square

up to one another in a televised debate later on. Millions of TV

viewers will get a chance to see if President Nicolas Sarkozy can

defend his record, while the Socialist challenger and favoured

Francois Hollande explains why he would do things different be. The

economy will be centre stage, but what exactly did the candidates

have they certainly seen as different as chalk and cheese.

At Gabba, flamboyant Nicolas Sarkozy up against Francois

Hollande, a rather grey man with a populist touch. But when it comes

to the -- economic policy, it is Francois have gone to has been

attracting the loudest cheers, and inspiring the greatest fears.

France is at a crossroads. The economy is stagnating and

Employment is nearly 10%. The government is under pressure to

bring the budget deficit under control and contain its growing

debts. It is how they plan to do that which separates the two

candidates. Nicolas Sarkozy prefers the austerity creed preached by

Germany. He put a tight lid on spending and trim to back the

welfare state. It suits for markets, but it is also highly unpopular, as

people worry about jobs and social security. Francois Hollande rejects

that approach. He wants to focus on boosting growth instead. It is a

strategy that seems to be winning votes, but there may be less

difference between the two then meets the eye. There is no big

ideological divide, between a Keynesian policy with Francois

Fillon, and to be near the ball policy of austerity with Sarkozy.

When you look at the figures for spending and the deficit, it is

actually extremely close. perceptions matter, especially when

it comes to France's relationship with Europe. Francois Hollande has

pledged to renegotiate the fiscal compact, and you eurozone treaty

designed to make eurozone members balance their budgets. He wants to

move the officers from austerity to growth. That has not gone down well

in Brussels or Berlin, but it has tapped into a rich vein of anti-

European feeling in France. In today's debate, both candidates

will have a chance to show that they know best for the country.

It will be very interesting viewing, that televised debate, later on

today. These are the markets in Asia. As you can see, they're all

headed in One Direction. Some are stronger than others. All of these

markets were open for trading today. A lot of this is good news on the