:00:03. > :00:13.electricity. It is now time for the latest
:00:13. > :00:20.
:00:20. > :00:24.financial news with World Business Here are the headlines: As the
:00:24. > :00:28.challenge his mount for China's new leaders, we ask what the changeover
:00:28. > :00:33.will mean for the world's number two economy.
:00:33. > :00:41.Bad loans are on the rise at China's banks. The worst run of
:00:41. > :00:45.figures since records began. And the eurozone's economic slump
:00:45. > :00:55.continues. Growth numbers may confirm fears it is even fizzling
:00:55. > :01:04.
:01:04. > :01:08.Good to have you do this. China's new Premier has been addressing the
:01:08. > :01:12.Chinese people following the announcement of the new leadership
:01:12. > :01:16.in the world's second-largest economy. He said they face serious
:01:16. > :01:21.challengers and strengthening the economy is top priority. New
:01:21. > :01:31.Saturday from China's banks indicates feeling grew that it may
:01:31. > :01:36.be hard. -- fuelling growth. It has been a momentous day for China.
:01:36. > :01:40.This news coming out about loans is not good at all, is it?
:01:40. > :01:45.Absolutely. It is signalling trouble to come for the country's
:01:45. > :01:48.new leadership. These delinquent loans increased for a fourth
:01:48. > :01:54.straight quarter. The longest streak of deterioration since the
:01:54. > :01:59.data became available eight years ago. It highlights growing
:02:00. > :02:07.pressures on profitability as the economy continues to weaken. Non-
:02:07. > :02:17.performing loans rose by a whopping $3.6 billion in the three months to
:02:17. > :02:19.
:02:19. > :02:26.September to about 480,000,000,001. It comes from all financial
:02:26. > :02:31.institutions. Chinese lenders are grappling with rising defaults and
:02:31. > :02:36.we can loan demand after economic growth slowed for a seventh quarter.
:02:36. > :02:46.Combine that income from all these banks -- combined income from all
:02:46. > :02:52.these banks slumped down from 23%. We are seeing a growing downturn in
:02:52. > :03:00.the profitability of the banks. Let's have further analysis now on
:03:00. > :03:10.what the challengers are for the leadership in China. We go live to
:03:10. > :03:10.
:03:10. > :03:17.a bureau in Beijing. We just heard that this rise in bad loans at
:03:17. > :03:21.China's banks is not a good sign. That is certainly not very good
:03:21. > :03:26.news. If we step a little bit back, today is a very exciting moment
:03:26. > :03:32.because we just learned who the captain and the captain's bilby for
:03:32. > :03:36.China's next 10 years. The government will be faced with a
:03:36. > :03:40.whole series of economic and political challenges. Financial
:03:40. > :03:45.reforms is one of the things they will have to target. Apart from
:03:45. > :03:49.that there will be other things they need to look at, which
:03:49. > :03:54.includes more liberation on immigration system. Social welfare
:03:54. > :03:56.is important as well. It is important to remember that the new
:03:56. > :04:01.government will be the one that is sitting on the seat making all
:04:01. > :04:07.these changes. The background is really that China is now the second
:04:07. > :04:10.largest economy in the world and it is going to be an economy that will
:04:10. > :04:15.probably have its lowest economic growth since the night -- late
:04:15. > :04:23.1990s. It is an exciting moment and we have just seen who is in charge,
:04:23. > :04:29.but we knew he would get the top job. But what about the team as a
:04:29. > :04:36.whole? That was shrouded in secrecy. Given that announcement, what can
:04:36. > :04:42.you make of their plans for the economy? Justin Howe were ago we
:04:42. > :04:50.saw through the final seven men are who are making into the important
:04:50. > :04:54.panel. We see that this is a panel that is a mixture of those who
:04:55. > :05:00.embrace the conservative approaches and those who would embrace the
:05:00. > :05:04.liberal ones. If anything, the leader is still the important one.
:05:04. > :05:09.We have not heard a formal work agenda from him yet, but judging
:05:09. > :05:14.from past experience, it is important to know that his work in
:05:14. > :05:19.the coastal provinces tell us that he is someone who is sympathetic to
:05:19. > :05:23.those who advocate for more fresh and open market reforms. That is
:05:23. > :05:31.always a pleasing sign. I'm glad to see you worry and read today. Will
:05:31. > :05:35.we will leave it there. Thank you for your time.
:05:35. > :05:43.As you have been hearing on Wednesday we saw a wave of petty
:05:43. > :05:48.austerity protests and strikes across Europe. -- NT austerity.
:05:48. > :05:53.Today GDP data it will be announced. In a few hours we will start to get
:05:54. > :05:58.a sense of the depth of the slump in the eurozone as a whole. The
:05:58. > :06:03.region's economy is predicted to contract again down 2.2 % when
:06:03. > :06:10.compared to the second quarter. When you look at it conveyed to a
:06:10. > :06:14.year ago, we are seeing a contraction of 0.7%. Some experts
:06:14. > :06:19.are warning that these predictions are wildly optimistic, given the
:06:19. > :06:22.factory surveys for September which prevent --. The bigger slump in
:06:22. > :06:27.almost three years. The big worry is that the stronger parts of
:06:28. > :06:31.Europe no longer hold up against the broader economic crisis. The
:06:31. > :06:36.figures for France come out in an hour. They are expected to show
:06:36. > :06:41.absolutely no growth at all in the third quarter. If we look at
:06:41. > :06:47.Germany, this is even more worrying, they will reveal growth slowing to
:06:47. > :06:54.just 0.2%. Not surprisingly the data is expected to confirm further
:06:54. > :07:02.contentions for the economies of Italy and Spain. We go to a senior
:07:02. > :07:06.economist from Brussels. Are you are in agreement with those
:07:06. > :07:12.figures? Some economists believe the figures will be a lot worse in
:07:12. > :07:16.the third quarter than what I have just spelled out. I more or less
:07:16. > :07:20.agree with the figures. The risk is there that they could get worse.
:07:20. > :07:24.The hall fear is the German economy remains rather stable and issued
:07:24. > :07:31.help the eurozone as a whole to mask the enormous slump in the
:07:31. > :07:34.southern countries. Your outlook, because this week we were focused
:07:34. > :07:38.on Greece with their budgets creeping through the night before
:07:38. > :07:48.in the Parliament. The year ahead for the eurozone will be very
:07:48. > :07:48.
:07:48. > :07:50.difficult, won't it? Obviously the year ahead will be a tough one. In
:07:50. > :07:58.the know at near-term it will probably get worse before it gets
:07:58. > :08:01.better. The German economy could enter a period of contraction
:08:01. > :08:04.towards the end of the year. This means that the eurozone economy
:08:04. > :08:09.will probably and the rebound in the first half of next year at the
:08:09. > :08:14.earliest. This puts enormous pressure on the reform agenda and
:08:14. > :08:20.also on the elections. A are you optimistic or you pessimistic about
:08:20. > :08:23.the outlook? Clearly we have the difficult year ahead and also, with
:08:23. > :08:32.Greece, they have more time and therefore there is a whole
:08:32. > :08:36.discussion going on about debt restructuring for Greece. I think
:08:36. > :08:40.I'm moderately pessimistic. The worst-case scenario, Greece leaving
:08:40. > :08:44.the eurozone or even a break-up of the eurozone, this has been
:08:44. > :08:49.abolished. It means the eurozone will stick together, but at the
:08:49. > :08:53.same time, the reforms that are undertaken in all countries, the
:08:53. > :08:58.slowdown of the global economy, means that the will remain in a
:08:58. > :09:02.very difficult economic environment, therefore growth will not return
:09:02. > :09:07.any time soon, but the worst case is the break-up and that will not
:09:07. > :09:12.happen. Most people would agree with you. When do you think we
:09:12. > :09:22.might see some sort of turning point when it comes to the
:09:22. > :09:25.following eurozone data as a region? And 2013. All we will still
:09:25. > :09:30.need some time to see the structural reforms. Any country
:09:30. > :09:34.like Spain will show some positive signs. At the same time, if the US
:09:34. > :09:39.and Chinese economies would be able to pick up again in the first half
:09:39. > :09:43.of the year, then Germany could benefit and there should also help
:09:43. > :09:52.stabilise the eurozone economy. There is some hope, but in terms of
:09:52. > :09:57.domestic developments, it is hard to see the eurozone countries
:09:57. > :10:03.growing again any time soon. We have third-quarter earnings
:10:03. > :10:10.results coming through, continuing in the US. We will hear from Wal-
:10:10. > :10:16.Mart today. Wall Street is expecting better profits because of
:10:16. > :10:26.a rush of sales on the east coast. It may also give an update on the
:10:26. > :10:26.
:10:26. > :10:30.plus the -- cost of its ongoing investigation into foreign bribery.
:10:30. > :10:34.Results from Dell. The once dominant PC maker is focusing on
:10:34. > :10:39.large corporate customers. The enterprise market. Wall Street will
:10:39. > :10:43.be looking at how hard the PC industry is being hit by the rise
:10:43. > :10:47.of tabloid computers. The markets are quite mixed, as you
:10:47. > :10:54.can see. Japan bucking the trend. Elsewhere we are seeing a bit of a
:10:54. > :11:02.mixed picture emerging. If we take a look at the currencies quickly.