:00:02. > :00:12.BBC World News. Now for the latest financial news in World Business
:00:12. > :00:17.
:00:18. > :00:20.Report. Hello and welcome to World Business Report. Europe's
:00:20. > :00:25.manufacturing sector is expected to contract further as Greece
:00:25. > :00:28.continues its appeal for more breathing space. The world's
:00:28. > :00:38.biggest drinks maker, Diageo, will reveal how much money its made in
:00:38. > :00:42.
:00:42. > :00:45.the last 12 months in a few hours. Qantas records its first annual
:00:45. > :00:55.loss in a 17 years and due to higher fuel costs to and labour
:00:55. > :00:56.
:00:57. > :00:59.problems. We'll have a better idea of how far and how fast the
:00:59. > :01:03.eurozone economy is sinking when the latest purchasing managers
:01:03. > :01:05.index numbers are released in a few hours time. Economists predict
:01:05. > :01:10.further contraction in the manufacturing sector following
:01:10. > :01:13.signs that even Germany is stalling. That will provide a bit of context
:01:13. > :01:16.for Angela Merkel and Francois Hollande, who are meeting this
:01:16. > :01:21.evening ahead of their respective meetings with Greek Prime Minister
:01:21. > :01:24.Antonis Samaras. At key talks with Jean Claude Juncker on Wednesday Mr
:01:24. > :01:29.Samaras appealed for more time to implement tough austerity measures
:01:29. > :01:32.and warned of deeper spending cuts ahead. Mr Juncker, who is head of
:01:32. > :01:38.the Eurogroup, said he's totally opposed to Greece leaving the
:01:38. > :01:48.single currency and that Greece is achieving greater stability. I'm
:01:48. > :01:48.
:01:48. > :01:53.joined by Christian Schulz, Senior Economist at Berenberg Bank. For
:01:53. > :01:59.the manufacturing data due out today, what are you expecting?
:01:59. > :02:04.are expecting values below is the 50 mark which separates expansion
:02:04. > :02:10.from contraction. It will be in the range for 45 for manufacturing, may
:02:10. > :02:15.be lower than that. Which means significant contraction. It is a
:02:15. > :02:21.slight stabilisation. Recession is not accelerating. It is staying at
:02:21. > :02:26.these levels. How worrying is the situation in terms of the economic
:02:27. > :02:32.news we are getting about the eurozone? It is a worrying. Jobs
:02:32. > :02:37.are lost and competitiveness may be lost in some company and that is
:02:37. > :02:42.not good for the long-term, especially in companies which from
:02:42. > :02:47.a fundamental point of view should not have a recession - like Germany
:02:47. > :02:53.or France. Manufacturing is the most globally integrated and are
:02:53. > :02:59.therefore dependent on the export sector. The services sector is
:02:59. > :03:03.looking significantly is better. Manufacturing is clearly hit. Every
:03:03. > :03:07.time the crisis hits home in Germany, every time there is a
:03:07. > :03:12.threat of recession, the German government seems more active in
:03:12. > :03:19.stopping the euro crisis from spreading. It motivates them to do
:03:19. > :03:24.more. Prime Minister Antonis Samaris is on a real offensive in
:03:24. > :03:31.terms of trying to get what he needs all what he believes is right
:03:31. > :03:35.for the Greek economy. Do you think he will be successful? There seems
:03:35. > :03:39.to be some flexibility on the German side. We have seen several
:03:39. > :03:44.senior lawmakers in Germany that within the amber light there is
:03:44. > :03:51.some flexibility. That also means there is not going to be any extra
:03:51. > :03:55.money. Angela Merkel will not spend any political capital off trying to
:03:55. > :04:01.convince the parliament to put up more money for Greece. She has
:04:01. > :04:05.elections next year. There is going to be a bit of a reality check for
:04:05. > :04:11.Prime Minister Antonis Samaris. It does not seem like they want to put
:04:11. > :04:14.Greece out of Europe. Nobody wants to take that the seizure. There is
:04:14. > :04:21.some flexibility. Prime Minister Antonis Samaris needs to convince
:04:21. > :04:28.the Germans he can use some extra time. Not just the Germans but
:04:28. > :04:35.other Europeans and the IMF which means the Americans. This is
:04:35. > :04:38.proving a very important week for the eurozone and the Greek economy.
:04:38. > :04:42.The world's biggest drinks maker, Diageo, will reveal how much money
:04:43. > :04:46.its made in the last 12 months in a few hours. Its also expected to
:04:46. > :04:48.tell its shareholders a lot more detail on its expansion plans.
:04:48. > :04:51.There's growing speculation the maker of Johnnie Walker Whisky and
:04:52. > :05:01.Guinness beer will add a Mexican tequila producer to its portfolio.
:05:02. > :05:03.
:05:03. > :05:08.Russell Padmore reports. The Diageo struggles with the impact of the
:05:08. > :05:13.region's debt crisis. That has not deterred the company from investing
:05:14. > :05:18.in its Scotch whisky business. In June, it revealed plans to spend
:05:18. > :05:23.$1.6 billion to expand production of a whisky. It takes a long time
:05:23. > :05:27.to distil whisky, but the product will be aimed at American drinkers.
:05:27. > :05:30.The world's biggest market for spirits. While North America and
:05:30. > :05:36.Europe accounts for two-thirds of its profits, the company is
:05:36. > :05:40.determined to concentrate more on emerging markets. China, for
:05:40. > :05:46.example, where foreign wristy -- whisky brands are barely 1% of
:05:46. > :05:53.consumption. Demand for spirits in Africa and Asia will continue to
:05:53. > :05:57.increase according to some. Scotch whisky does have at cachet in
:05:57. > :06:00.emerging markets. With current prosperity in these markets, there
:06:00. > :06:07.will be an increasing amount of people will be able to afford to
:06:08. > :06:14.drink these products. Beer brands produced by its rivals are a strong
:06:15. > :06:20.competition in Africa for Diageo. Brewers in Ethiopia and Tanzania
:06:21. > :06:26.are enhancing its profits. It is also selling Guinness in a Nigeria.
:06:26. > :06:33.Shareholders will be watching for the possible takeover of a Mexican
:06:33. > :06:38.tequila producer. This dark Irish BA is one of the stables. It relies
:06:38. > :06:44.however more on spirit sales. It is two-thirds of the business. Other
:06:44. > :06:48.predictions is that emerging markets will see a golden age of
:06:48. > :06:56.demand as young aspiring businessmen will get a taste for it.
:06:56. > :07:01.No wonder, Diageo is targeting half of its sale to come from emerging
:07:01. > :07:04.markets by 2015. Australian airline Qantas has posted its first annual
:07:04. > :07:14.loss since it was privatised in 1995, amid high fuels costs and
:07:14. > :07:15.
:07:15. > :07:25.growing losses at its international operations. And we know Qantas has
:07:25. > :07:32.had a tough time with labour dispute and all sorts. A reversal
:07:32. > :07:37.of fortune. What a year makes for the nation's flag-carrier. It
:07:37. > :07:44.announced $256 million net loss and that is at a higher for billion-
:07:44. > :07:50.dollar turn around from a net profit at in the previous month.
:07:50. > :07:55.Then driven by the European economic crisis and higher fuel
:07:55. > :08:01.prices, there was also the soaring Australian dollar, the bitter
:08:01. > :08:07.battle with unions about salaries which saw Alan Joyce grounding the
:08:07. > :08:14.entire fleet for 48 hours in October. Despite these crippling
:08:14. > :08:21.factors, its share prices is up. By about 4% up in Sydney trading.
:08:21. > :08:27.Investors, quite pleased and happy with the decision to cancel a major
:08:27. > :08:31.order of 35 Boeing 787 Dreamliner aircraft worth about 9 billion US
:08:31. > :08:35.dollars. At this point, the airline did not offer any forward looking
:08:35. > :08:38.proper guidance but it said that the operating environment and
:08:38. > :08:44.economic outlook remains challenging, volatile and dependent
:08:44. > :08:52.on a number of uncontrollable external factors. We will see how
:08:52. > :08:55.it fears in the next year. -- fares. Uncontrollable external factors -
:08:55. > :08:58.you never like to hear that phrase. Computing giant Hewlett-Packard has
:08:58. > :09:02.announced a monumental quarterly loss of $8.9 billion as it was
:09:02. > :09:05.forced to write down the value of some assets and take hefty re-
:09:05. > :09:09.organisational charges. Still, the world's largest technology company
:09:09. > :09:14.by sales did attempt to reassure investors and said they are "making
:09:14. > :09:16.decent progress despite the headwinds. Egypt has requested a
:09:16. > :09:20.$4.8 billion loan from the International Monetary Fund to help
:09:20. > :09:23.stabilise and revive its ailing economy. The formal request was
:09:23. > :09:30.made during talks in Cairo between President Mohammed Mursi and IMF
:09:30. > :09:32.chief Christine Lagarde. The IMF's technical team will visit Egypt
:09:32. > :09:42.next month to study the Egyptian government's economic programme and
:09:42. > :09:45.
:09:45. > :09:51.discuss possible forms of financial support from the IMF. Markets are
:09:51. > :09:57.up slightly in Asia. Some bad news out of China about its
:09:57. > :10:03.manufacturing factor. A first flash look at numbers - manufacturing has