:00:01. > :00:11.Those are the latest headlines from BBC World News.
:00:11. > :00:16.Now for the latest financial news in World Business Report.
:00:16. > :00:22.Welcome to the program. A chance to look at all the latest in the world
:00:22. > :00:25.of business and money. These are the headlines. Clashes at late
:00:25. > :00:30.night protests in Spain as anger mounts against planned austerity
:00:30. > :00:38.measures. And looking for a safe-haven. Why
:00:38. > :00:42.some investors are paying eurozone governments to hold their cash.
:00:42. > :00:52.And a bid for the makers of Tiger beer it may prove to be a bidding
:00:52. > :00:54.
:00:54. > :00:58.war. First, let's talk to eurozone.
:00:58. > :01:01.The terms and conditions of Spain's banking bailout are to be finalised
:01:01. > :01:05.by eurozone finance ministers today. But while they are being thrashed
:01:05. > :01:07.out, there are still fears that the country as a whole will need
:01:07. > :01:11.financial aid. Borrowing costs surged above the dangerous level of
:01:11. > :01:15.7% again. Last night, the biggest demonstrations so far against the
:01:15. > :01:20.latest planned austerity cuts. Thousands took to the streets in
:01:20. > :01:30.more than 80 cities. The protests lasted into the night and ended
:01:30. > :01:30.
:01:30. > :01:35.with clashes between police and some of those protesting. More from
:01:35. > :01:41.Madrid. Once again, thousands on the
:01:41. > :01:46.streets. This is one of the main squares. Full of people. Probably
:01:46. > :01:54.tens of thousands. It stretches right down the avenue. This latest
:01:54. > :01:58.action against the latest austerity measures, the sales tax was going
:01:58. > :02:02.up and public sector pay would be cut. The government hopes austerity
:02:02. > :02:06.measures are part of that agreement with the eurozone over rescuing
:02:06. > :02:13.Spanish banks would alleviate the pressure on markets. But, again,
:02:13. > :02:18.the borrowing rates have gone above the benchmark 7% rate of interest.
:02:18. > :02:22.Many people here seem to be organising themselves as they are
:02:22. > :02:26.unhappy about the latest austerity measures. But the government
:02:26. > :02:30.insists this is a way out for Spain. It needs to reduce spending and
:02:30. > :02:33.balance its budget for Spain to get out of the crisis.
:02:33. > :02:41.For more, I'm joined by Tom Rogers, Senior Economic Adviser to the
:02:41. > :02:45.Ernst & Young. I want to talk about Madrid and what they are trying to
:02:46. > :02:51.do. Certainly how they will get their books back in order. The
:02:51. > :02:55.bail-out was given the green light by German Members of Parliament
:02:55. > :03:00.yesterday. What is it about the bank bail-out that they have to
:03:00. > :03:04.thrash out? One of the things we make it more clarity on today is
:03:04. > :03:09.exactly how much money Spain will need to inject into its banking
:03:09. > :03:13.sector. We know it was agreed that up to 100 billion euros would be
:03:13. > :03:20.made available, which is just an estimate of how much would be
:03:20. > :03:24.required in practice. Some people estimate about 65 billion euros or
:03:24. > :03:29.so. We may therefore get more details on that and more on the
:03:29. > :03:34.interest rate. We may get why the details potentially about the
:03:34. > :03:41.eurozone banking union that was agreed in principle. So, how powers
:03:41. > :03:46.may shift from National bags to the European Central Bank. What's to
:03:46. > :03:49.discuss. -- national banks. Spain will get a bail-out and we know the
:03:49. > :03:53.Government is doing all it can to get its books batting order. But
:03:53. > :03:58.here is the problem - the markets and investors are not convinced.
:03:58. > :04:01.Spain went back to the market to borrow money yesterday and
:04:01. > :04:07.investors forced Madrid to pay high interest rates. They are not
:04:07. > :04:14.convinced? There are two issues. 1, the circularity between the banking
:04:14. > :04:17.sector and problems, struggling with bad debt. And the government
:04:17. > :04:27.would alter that Lee has to backstop the painting sector. But
:04:27. > :04:29.
:04:29. > :04:32.the government is also struggling. -- have to backstop the banking
:04:32. > :04:40.sector. Also, there is the political problems the government
:04:40. > :04:45.is having. But given all of what you have just said, at the end of
:04:45. > :04:51.the day, certain markets and investors are not sure if Spain
:04:51. > :04:56.itself is going to eventually need a bail-out for just its banks.
:04:56. > :05:00.Exactly. The government is aiming to get its deficit down to 3% GDP
:05:00. > :05:04.by 2014. It is currently about 8%. There will be many difficult
:05:04. > :05:09.measures that need to be taken to get there. Thank you. We appreciate
:05:09. > :05:12.your time. Moving on.
:05:13. > :05:16.Lending money to the government has traditionally been seen as a low
:05:16. > :05:20.risk investment and normally an investor gets paid a return for
:05:20. > :05:24.parting with his cash. But now, as the eurozone crisis deepens, there
:05:24. > :05:26.has been a curious development. In some parts of the region, like
:05:26. > :05:31.Germany and Belgium, investors are actually paying the government to
:05:31. > :05:34.lend them money. In other words, interest rates have turned negative.
:05:34. > :05:42.Jeremy Howell explains how the topsy-turvy world of debt has
:05:42. > :05:49.emerged. It is a stark sign of the chasm
:05:49. > :05:54.that has opened between Europe's volatile periphery and its core.
:05:54. > :05:58.The markets are demanding interest at 5% or more after a two-year bond.
:05:58. > :06:03.But they are so keen on holding the German bonds, but the interest rate
:06:03. > :06:07.for them has been negative for the past week and a half. Finish, Dutch,
:06:07. > :06:11.Austrian and French bonds are trading at rates below zero.
:06:11. > :06:21.Investors here in the collapse of the euro are ensuing financial
:06:21. > :06:22.
:06:22. > :06:28.chaos see them as safe a -- and ensuing financial chaos see them as
:06:28. > :06:32.safe havens. With this period of financial uncertainty, uncertainty
:06:32. > :06:36.in the European banking area, it is important for people to feel that
:06:36. > :06:40.there are these areas of safe havens for the money is protected.
:06:40. > :06:44.There may be another reason why the financial markets are keen to hold
:06:44. > :06:49.bonds, even when the return is negative. Euros have collapsed and
:06:49. > :06:54.the countries of Europe have gone back to the old currencies. -- if
:06:54. > :06:58.euros collapse. Then bonds would increase in value as those
:06:58. > :07:06.currencies strengthen. Given the likely strength of the Deutsche
:07:06. > :07:10.Bank if that would happen, you can see a substantial increase in the
:07:11. > :07:19.currency. It is far from clear that the bombs would be leader nominated.
:07:19. > :07:24.They may stay in the euro. -- banks. Analysts say bonds continued to
:07:24. > :07:29.trade at rates below zero. That is until eurozone politicians for a
:07:29. > :07:37.banking union and a fiscal court to restore confidence in the future of
:07:37. > :07:40.the euro. A tussle for control of the company
:07:40. > :07:43.that brews Tiger beer, Heineken, has offered $4.1 billion to buy
:07:43. > :07:49.full control of Asia Pacific breweries, just days after a Thai
:07:49. > :07:54.billionaire and his family bought a stake.
:07:54. > :07:59.Great to see you. What is going on? It seems like everybody want a bit
:07:59. > :08:05.of Tiger. That is right. It does seem like
:08:05. > :08:11.everybody wants a refreshing pint or a bit more than that. Heineken
:08:11. > :08:15.has made a bid to buy stakes. It already owns shares but wants to
:08:15. > :08:22.buy a whole of the Singapore listed company. The bid comes just days
:08:22. > :08:25.after Thailand's biggest brewer offered to buy shares in it, as
:08:25. > :08:28.well as a Asia Pacific Brewery switch actually bruise the beer.
:08:29. > :08:32.This may be something of a pre- emptive move by Heineken to protect
:08:32. > :08:37.its interest in the region. It also wants to continue with its
:08:37. > :08:44.expansion plans and this comes as beer companies tussle for control
:08:44. > :08:50.of Asia's fast-growing market. According to Heineken's chief
:08:50. > :08:55.executive, he said that the nature of the company's partnership had
:08:55. > :08:59.changed due to the structure of the company and the shareholding. He
:08:59. > :09:04.said he is looking forward to the next chapter of its Asian business.
:09:04. > :09:09.Heineken says it will offer about 50 Singapore dollars per share
:09:09. > :09:17.within the current ownership of this company. It is fairly complex.
:09:17. > :09:26.We will wait to see how it pans out. Two. -- thank you.
:09:26. > :09:31.A -- in other news, the worst drought in the US for 50 years is
:09:31. > :09:34.raising fears of a food crisis. The price of corn and soy beans hit new
:09:34. > :09:38.records on Thursday as supplies continue to be hit by the
:09:38. > :09:41.blistering heat. There is little or no rain forecast until at least the
:09:41. > :09:44.end of this month. The US is the world's biggest producer of corn
:09:44. > :09:51.and a major supplier of wheat and soy beans.
:09:51. > :09:53.Google has posted a jump in sales and profit. It rose 11% to $8
:09:53. > :09:58.billion. Shares rose after investors were encouraged by the
:09:58. > :10:01.amount of money it was making from customers clicking on adverts,
:10:01. > :10:04.which of course Google charges a fee.
:10:04. > :10:08.fee. This is what the Asian markets are
:10:08. > :10:13.doing. The mixed bag. Despite the gains we saw overnight on Wall
:10:13. > :10:20.Street, on the back of some upbeat corporate earnings. The Tate in