:00:02. > :00:12.be a step forwards towards democracy.
:00:12. > :00:15.
:00:15. > :00:22.Now for the latest financial news, here is World Business Report.
:00:22. > :00:26.The headlines: Greece's coalition government fights over vital
:00:26. > :00:36.spending cuts. Francois Hollande promises to turn
:00:36. > :00:39.
:00:39. > :00:42.around the flagging French economy in just two years.
:00:42. > :00:49.The leaders of the three parties in Greece's coalition government had
:00:49. > :00:54.failed to agree on Sunday's packages of spending cuts worth
:00:54. > :00:59.$14.7 billion. Prime minister Antonis Samaras is calling the cut
:00:59. > :01:07.crucial to sustaining the bailout funding. The Conservative premier
:01:07. > :01:12.and the two other party leaders, the Socialists and the Democrats,
:01:12. > :01:15.disagree on the across the board cuts to pensions and wages. They
:01:15. > :01:18.insist that Greece's international creditors give the country more
:01:18. > :01:25.time to implement the cuts. The three leaders will meet again on
:01:25. > :01:35.will be speaking to representatives from the IMF today, and on Tuesday
:01:35. > :01:44.
:01:44. > :01:48.with the ECB president. I am joined by head of foreign exchange... We
:01:48. > :01:54.seem to be no closer to Greece hitting targets and getting the
:01:54. > :01:56.extra money they need. That's right. We are back into the diplomacy
:01:56. > :02:02.element where the various politicians are negotiating with
:02:02. > :02:05.each other. The problem is, as time goes on and economies continue to
:02:05. > :02:11.attract, their ability to meet the targets in terms of cuts will
:02:11. > :02:14.continue to diminish. They are hoping to get more time in order to
:02:14. > :02:21.enact some of the cuts, but whether the creditors are prepared to give
:02:21. > :02:26.them that time is still a moot point, that is the problem. What do
:02:26. > :02:33.the creditors want to see in terms of evidence that Greece is
:02:33. > :02:38.deserving of the next tranche of cash? There will be some scrutiny
:02:38. > :02:41.of how aggressive the cuts have been. How they have been
:02:41. > :02:45.implemented. Also the implementation of other measures
:02:45. > :02:50.such as privatisation. It's all very well saying they will sell for
:02:51. > :02:55.the area's industries or sections of assets, without actually moving
:02:55. > :03:01.ahead and doing that the international community will say
:03:01. > :03:06.that it is not really being enacted. We need to see real time cuts.
:03:06. > :03:16.EU think this is a question of these politicians having to bite
:03:16. > :03:19.
:03:19. > :03:24.the bullet? -- do you think. They need to see the politicians or are
:03:24. > :03:31.in a position of strength. Antonis Samaras cannot deliver unless
:03:31. > :03:34.creditors agree. If you're faced with a painful decision, if you can
:03:34. > :03:43.postpone or delay it you will try to do that. That is what the
:03:43. > :03:49.politicians are attending. That is reliant on the creditors plane ball.
:03:50. > :03:53.-- playing. It is quite rational for them to say "we don't want to
:03:53. > :04:02.give you more time" it will not just be more time, it will be more
:04:02. > :04:06.money. There is this issue of a debate between the parties. It will
:04:06. > :04:11.be a case of them trying to push the envelope to try to get the best
:04:11. > :04:16.terms possible. It is a Game of bluff in poker, with the financial
:04:16. > :04:21.markets being the key element. Briefly, Antonis Samaras will meet
:04:21. > :04:25.with the head of the ECB tomorrow. His announcement last week about
:04:25. > :04:30.buying bonds in the financial markets does not help Greece at all,
:04:30. > :04:34.does it? No, that was about economies which still have access
:04:34. > :04:38.to the financial markets, which Spain still does. For those such as
:04:38. > :04:43.Greece which is reliant on funding - they are a separate account. We
:04:43. > :04:51.are talking about two separate strands which overlap, because they
:04:51. > :04:56.are in the eurozone, but we are talking about the head of the ECB
:04:56. > :05:01.having a process that could be helpful to Spain, Ireland and
:05:01. > :05:06.Portugal at this point. French President Francois Hollande
:05:06. > :05:09.has promised to turn the country's stagnant economy around by 2014. He
:05:09. > :05:14.made the announcement in a prime- time television interview on Sunday,
:05:14. > :05:17.it comes four months into his presidency. Critics have accused
:05:17. > :05:26.him of procrastination. He outlined a series of measures including
:05:26. > :05:36.spending cuts, and he said the government would lower its growth
:05:36. > :05:41.
:05:41. > :05:46.forecast for next year to just 0.8%, down from 1.2%. There will be a...
:05:46. > :05:51.We have more on Francois Hollande's controversial tax plans. The
:05:51. > :05:54.wealthy in France promised to raise income tax on the wealthy up to 75%.
:05:54. > :05:59.That was one of his more popular pledges, which helped him win the
:05:59. > :06:05.election. Not everyone thinks the plan is feasible. The problem with
:06:05. > :06:10.this absurd pledge, the 75% tax rate, once you are in power, you
:06:10. > :06:18.more or less have to go by it and abide by it. Now we see the
:06:18. > :06:21.Government considering that it was obviously out rages and done by
:06:21. > :06:26.Francois Hollande to react to some piece of news during the elections.
:06:26. > :06:33.They are trying to water the proposal down now. Of course, they
:06:33. > :06:39.will get the worst of both worlds, because their supporters will say
:06:39. > :06:46.they are betraying them.... Attempts to water down the
:06:46. > :06:50.proposals in Parliament have met with difficulties. France's
:06:50. > :06:55.government needs to raise more tax or cut spending. The new President
:06:55. > :06:58.has made a commitment to balance the budget within five years. He
:06:58. > :07:06.has damaged his credibility on being able to do that on public
:07:06. > :07:15.finances. That acts as a restraint on the government's ability to
:07:15. > :07:22.refloat the economy. There is a limit to how far the government can
:07:22. > :07:27.go. This means Francois Hollande faces a tough act of balancing on a
:07:28. > :07:35.tightrope. He will be watched with intense scrutiny in the lead-up to
:07:35. > :07:41.the Budget. We had had a lot of economic news
:07:41. > :07:51.out of China. The trade surplus has widened to $27.6 billion as exports
:07:51. > :07:56.rose and imports went down. What picture is this painting about
:07:56. > :08:02.China? It's still showing that things are slowing down.
:08:02. > :08:06.Absolutely. The export numbers grew at a slower pace than forecast in
:08:06. > :08:14.the month of August, while imports fell as well, surprisingly. The
:08:14. > :08:20.latest numbers revealed that there is a mounting challenge that
:08:20. > :08:23.Shanghai's policymakers face. The data confirms President Hu Jintao's
:08:23. > :08:31.warning over the weekend of the great challenges posted by the
:08:31. > :08:35.world economy. They could be further stimulus and monetary
:08:35. > :08:39.easing to support the expansion of the economy. We have seen off the
:08:39. > :08:42.August data now from the Trade report, Investment and retail sales,
:08:42. > :08:47.it has become clear that the slowdown is growing and that the
:08:47. > :08:50.government is feeling the need to act. One economist I spoke to is
:08:50. > :08:58.worried on how this might affect the rest of Asia. The region had
:08:58. > :09:03.been hoping China would come up with some sort of stimulus and
:09:03. > :09:09.packages in terms of consumption, but this is not happening.
:09:09. > :09:19.A couple of other business stories: The chief executive of extra Otter
:09:19. > :09:28.
:09:28. > :09:38.is ready to step down after a $36 billion takeover. -- XStrata.