24/05/2012 World Business Report


24/05/2012

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Those are the latest headlines from BBC World News. Now for the latest

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financial news with World Business Report. The euro trades at 2-year

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lows after an informal summit of EU leaders emphasises serious policy

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differences. Plastic fantastic - a key ruling on plans to make it

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cheaper and easier to shop by credit and debit card across the

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European Union. It was a case of entente not-so-cordiale. The old

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Franco-German marriage at the heart of the eurozone family is on the

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rocks. At an informal meeting of European Union leaders, French

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President Francois Hollande demanded eurobonds be put on the

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agenda for a full summit at the end of next month. But Germany remains

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opposed to plans to pool eurozone governments' debt in a move that

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would effectively allow indebted nations such as Greece to piggy

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back Germany's superior credit rating. Christian Schulz is a

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former economist at the European Central Bank and is now senior

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economist at Berenberg bank. Let us talk about the Euro bombs Porsche,

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what you feel is the Agenda for that? They want to discuss it at

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the end of June. The thing that is something that to discuss? It is on

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the very long-term agenda of the European Union. If the conditions

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for it are in place, of the country's build credibility, it is

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the German condition. We are not opposed to Euro bombs as a means to

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end the crisis. It could be an end to the crisis of countries like

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Italy if they could start issuing money with guaranteed bonds by

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Germany. There is something Germany will not allow to happen since the

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fiscal tree has not been signed in countries have not done enough yet

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to do down deficits. Some argue the short-term benefits is that it

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would stop speculative action and it is pushing up the borrowing

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costs for Spain and other economies like Greece. What are the long-term

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benefits? It could be good. You would have a bigger bond market for

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Europe. It countries have reasonable debt levels, and a

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history of discipline in budgetary terms, it could be good. Countries

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like Germany could benefit a little bit because of the bigger the

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quiddity of the European bond market. That would take a long time

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to come into place. The European bonds are rather an unlikely

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solution to the crisis. Let his -- let us look at what has been

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achieved in the last 24 hours, your view? Europe is united on the

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position for Greece. Nobody at the meeting said that Greece can be no

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Gays yet the conditions of the bailout. It is your choice, stay in

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or out. That shows a unity and leads us to believe we can prepare

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for a creek exit or have the Greeks vote in favour of it staying in.

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The growth initiative, we would have expected more detail. There is

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an initiative against youth unemployment but it was all a bit

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modest. We will look at this in detail later. Much of the press is

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dedicated to what was going on in Brussels, so the wheel - mark we

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will discuss it further with the papers. The world's biggest

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computer-maker Hewlett-Packard has confirmed it's laying off 27,000

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employees around the world. 1 in 12 of its workforce will go. A company

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spokesman could not give details of where the cuts would come but said

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most sites - including those in the UK - would be affected. Michelle

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Fleury has more from New York. This is not the first time Hewlett

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Packard has cut jobs. This is the largest in their history. The

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reductions will affect 8% of their 350,000 global workforce by the

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time the overhaul is completed, expected in October of 2014. In its

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press release, the company said it hopes it will not have to do too

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many lay-offs because it is offering it retirement packages.

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The question is, why has the company doing this? A clue for

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those of you who have not been following the falling share price

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of Hewlett-Packard comes from what the C O has to say. He says the

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cutbacks are necessary to improve execution and fund their long-term

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health of the company. The problem has, over the years, Hewlett-

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Packard, best known for things like printers, PCs and laptops has

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fallen behind the times. Many analysts say it has too much

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invested in declining businesses. As more of us moved to new services

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like cloud computing and smart phones and Ablett computers. The

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company hopes to save the money it -- invest the money it saves in

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cloud computing and be data and security. It hopes all of this will

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help invigorate one of the oldest names in silicon Valley. It could

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soon become cheaper and easier to shop electronically around Europe.

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A European court is due to rule whether Mastercard should slash its

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fees on cross-border card transactions. At the moment,

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retailers have to pay hefty charges to the world's second biggest card

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operator and Visa Europe when customers from another EU state buy

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goods or services on their cards. The European Commission is keen to

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break down barriers to e-commerce and cut costs for businesses in the

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27 country European Union. The battle between the EU, Visa Europe

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and Mastercard has been rattling on for a number of years. In 2007,

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Commission said Mastercard's flat fee levied on retailers card

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transactions breached EU anti-trust rules and had to be changed.

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Mastercard agreed to reduce its fees but the EU competition

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commissioner said there is no evidence that card transaction

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costs for retailers that come down. When in the long-term, it achieves

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the goal to make credit card payments more attractive and to

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strengthen cross-border payment of consumers and provides them with

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attractive means of payments, is still to be seen. Beazer Europe,

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the largest card network in Europe has cut its debit card charges in

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response to Commission investigation which followed a

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complaint by trade lobby group bureau, owners. That is not only

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the card companies were set to feel the impact of the decision. The

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European retail banks make a quarter of their total income from

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charges made on every card transaction. The commission is

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moving the spotlight on to them. Swiss negotiators are heading to

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Rome today to start talks on a tax deal between Switzerland and Italy.

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It's the latest in a series of agreements the Swiss government has

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reached with its European neighbours in a bid to lose its

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reputation as a tax haven for foreign wealth. At stake, billions

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of dollars of find assets stored in Swiss banks. And revenue hungry

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European governments who want every penny of tax owed to them paid as

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soon as possible. For years, these was resisted calls to hand over

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details of bank accounts, saying he was not their responsibility to act

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as tax inspectors. As austerity -- austerity measures bite, Europe is

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growing impatient and Switzerland has bowed to pressure, agreeing to

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impose holding tax on company accounts. Its famed banking secrecy

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is not ending with a bang but a series of quieted deals. First of

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Germany, then with Britain, and now, the Swiss government hopes with

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Italy. Individual account details still remain private but

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Switzerland will tax each bank account automatically and return

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the money to the country came from. That means that what many regard as

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the chief advantage of banking secrecy, hiding taxable income, is

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gone. But was banks are surprisingly eager to reach

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agreement and not just with European governments. The big prize

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remains the United States, where teams of lawyers continue to

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investigates was banks, among them the biggest and most important to

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Switzerland's economy, none of them want to face to eight -- charges of

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aiding tax evasion. Paying tax upfront has become the only

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realistic option. The markets are very focused on activity in

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Brussels. In Asia we saw losses today after heavy losses in Europe.

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Greece and the eurozone around the minds of investors globally. We had

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a preliminary reading of a survey on manufacturing in China. Chinese

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factories have shrunk for the 7th month in a worry. That is worrying

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