:00:19. > :00:24.financial news with World Business Report.
:00:24. > :00:28.The Chinese balancing act. We look at how the world's second largest
:00:28. > :00:35.economy intend to stay ahead of its competitors by focusing on itself.
:00:35. > :00:45.fastest-growing countries in the world, Nigeria says it is trying to
:00:45. > :00:45.
:00:45. > :00:51.diversify its economy away from oil. Welcome to World Business Report.
:00:51. > :00:59.Also in the programme: The slippery slide of the yen continues today as
:00:59. > :01:04.G7 finance chiefs say they will tolerate the currency's decline.
:01:04. > :01:08.China's growth has steamed unstoppable for four decades. It
:01:08. > :01:13.became known as the factory of the world but then came the global
:01:13. > :01:18.recession. Even the mighty China pause forced to take a hit. It has
:01:18. > :01:21.seen growth drop from double-digit a single digit but the question now
:01:21. > :01:26.is how protracted the slowdown is and what impact it will have won
:01:26. > :01:33.the rest of the world. Our chief business Correspondent has been
:01:33. > :01:37.joining us from Hong Kong. We joined her now. Sorry, first of all
:01:37. > :01:42.we are going to talk to, find out about one of the interviews she is
:01:42. > :01:52.doing for us. Linda has been speaking to the chief economist
:01:52. > :01:54.
:01:54. > :01:59.from the World Bank. I think the Chinese economy, yes,
:01:59. > :02:09.it is slow in its growth rate. Compared to how we used to be. But
:02:09. > :02:10.
:02:10. > :02:20.it is cyclical. The global economy has not gotten over this 2,000
:02:20. > :02:23.
:02:23. > :02:33.bandaid crisis yet. The a lot of your work has extolled... Talk
:02:33. > :02:33.
:02:33. > :02:43.about how China shows the capacity to increase. It has the capacity
:02:43. > :02:48.
:02:48. > :02:54.for 8% growth rate. Compared to advanced countries like the US, it
:02:54. > :03:04.was similar to Japan in the early 1950s. Singapore in the mid- 1960s.
:03:04. > :03:09.
:03:09. > :03:14.And Taiwan and Korea in the mood 1970s. -- the mid. They maintained
:03:14. > :03:21.around 8-9 per cent growth rate for 20 years by tapping into the
:03:21. > :03:27.potential. We know that China's growth model has been similar to
:03:27. > :03:37.the east Asian growth model since the tradition started in 1979. With
:03:37. > :03:39.
:03:39. > :03:46.that potential, it enabled of Japan and others 8-9 per cent growth rate
:03:46. > :03:52.for 20 years. So China should have the potential to grow at around 8%
:03:52. > :03:55.for another 20 years. That is how the Chinese government will manage
:03:55. > :04:05.the economy. And the potential is there.
:04:05. > :04:07.
:04:07. > :04:13.We have got you on standby, Linda. Clearly there is a very important
:04:13. > :04:17.rebalancing change going on in China. It started off with the new
:04:17. > :04:24.leadership at the end of last year. What signs are there that things
:04:24. > :04:29.are changing for the better? One of the key signs is that for the very
:04:29. > :04:38.first time this year, the first few months, the data suggests that the
:04:38. > :04:45.services sector, tourism, financial services, education, shops,
:04:45. > :04:50.retailers, that is more important in China's economy than factories.
:04:50. > :04:53.That is the first time this has been the case since 1979. Whether
:04:54. > :04:58.or not this is sustainable depends on whether the new leadership could
:04:58. > :05:03.be tempted to fuel the easier source of growth which is
:05:03. > :05:07.investment, construction. If they did that there is a danger that
:05:07. > :05:14.they could end up using debt to fuel the growth. As we know in the
:05:14. > :05:18.west, that is not sustainable. If they continue to grow domestic
:05:18. > :05:25.demand and support this and allow the services economy to flourish,
:05:25. > :05:35.that alongside, and by the way factories are still rolling, China
:05:35. > :05:40.
:05:40. > :05:45.can grow in a balanced way. -- factories are still growing. That
:05:45. > :05:55.will be better for China and the world as China is the world's
:05:55. > :05:55.
:05:55. > :06:00.biggest engine. Thank you very much indeed. Linda
:06:00. > :06:10.is with us throughout the day on BBC World News. You can get in
:06:10. > :06:14.
:06:14. > :06:18.touch with her via Twitter. Send her your questions.
:06:18. > :06:22.To Africa, and investors, business people and politicians have wrapped
:06:22. > :06:27.up their gathering at the World Economic Forum in Cape Town. There
:06:27. > :06:31.has been much focus on the recent African boom and what it means for
:06:31. > :06:37.investors and people who live there. One of the countries attracting
:06:37. > :06:41.plenty of interest is Nigeria. According to the World Bank it is
:06:41. > :06:46.now one of the fastest growing economies in the world but faces
:06:46. > :06:51.challenges. Economic growth has not cut poverty and has not created
:06:51. > :06:58.unnecessary jobs. About two-thirds of the population lives on less
:06:58. > :07:04.than one US dollar a day. There is dilapidated infrastructure and an
:07:04. > :07:07.over-dependence on the oil and gas industry. Our correspondent spoke
:07:07. > :07:13.to the Finance Minister and asked about the financial strategy to
:07:13. > :07:23.develop the non-oil sector. The oil sector does not create the jobs we
:07:23. > :07:25.
:07:25. > :07:33.need so we focus on agriculture. It is 40% of GDP. Our target is 20
:07:33. > :07:38.metric tons of food. We are focused on housing because it has many
:07:38. > :07:42.linkages to the rest of the economy. Manufacturing. We believe we need
:07:42. > :07:46.to build an industrial base and have a competitive advantage.
:07:46. > :07:50.Investors are concerned that despite the attractive elements of
:07:50. > :07:55.the economy in Nigeria, this is a country that has major
:07:55. > :08:00.infrastructure constraints, particularly power constraints. It
:08:00. > :08:05.adds to the cost of business. How do you address that? You are
:08:05. > :08:10.absolutely right and we address that, in particular power. Earth we
:08:10. > :08:18.recognise we have not been able to manage this sector are as we should
:08:18. > :08:23.so we have privatised it and liberalised it. We hope the power
:08:23. > :08:30.sector will make more headway and we can provide the power that
:08:30. > :08:36.Nigerians need. Security is another concern. Reports of insurgency, a
:08:36. > :08:41.wave of violence in the north of the country. Let me say this. We
:08:41. > :08:49.are heartened that in spite of this, Nigeria is the biggest destination
:08:49. > :08:53.for investment on the continent now. I think that investors see the way
:08:53. > :08:58.that most of the country is functioning normally. It is Ameen a
:08:58. > :09:05.section of the country being impacted like this. -- it is only a
:09:05. > :09:09.section. Much of the country is functioning well. In the north-east
:09:09. > :09:15.of the country we have a challenge and that is where most of these
:09:15. > :09:22.incidents happened. We have a strategy to deal with it. But it is
:09:22. > :09:27.not just Boko Haram, in the south kidnappings are still going on in
:09:27. > :09:32.the oil-rich region. All of those factors create a situation where
:09:32. > :09:38.people are afraid. Let me respond to that by saying yes there is
:09:38. > :09:43.kidnapping and other issues but it is all over the world. In South
:09:43. > :09:50.Africa there are problems of security. I don't want to comment.
:09:50. > :09:58.In the US, the UK. I think the Boko Haram is a special thing we focus
:09:58. > :10:03.on but the others are criminal things. That is not daunting
:10:03. > :10:07.investors. Nigeria's finance minister there
:10:07. > :10:11.with her interesting take on the future of that rapidly growing
:10:11. > :10:21.economy. The markets in Asia. No surprise,
:10:21. > :10:26.Japan up over 1%. The yen slid again today verses the US dollar.