:00:00. > :00:00.Brazil. Now, it is time for World Business
:00:00. > :00:29.Report. Omnicom and Publicis call off their
:00:30. > :00:39.billion`dollar merger. And, the euro makes a comeback, but not everyone
:00:40. > :00:44.is happy about it. Welcome to World Business Report. In just a moment,
:00:45. > :00:49.more from the World Economic Forum in Abuja, Nigeria, but first the
:00:50. > :00:54.sour, it looked like a marriage made in heaven, but it seems their
:00:55. > :00:59.relationship went sour before they could tie the knot. I am talking
:01:00. > :01:01.about these two chaps. A deal to create the world's biggest
:01:02. > :01:06.advertising company, which has collapsed in the past few hours.
:01:07. > :01:13.Omnicom, which is the biggest ad firm in the US, and French group
:01:14. > :01:15.Publicis, agreed a $35 billion merger last July that would have
:01:16. > :01:23.transformed the advertising industry. Here, you can see the two
:01:24. > :01:29.bosses in a show of transatlantic company. It has emerged that they
:01:30. > :01:36.have broken down, with emerging tensions between the two sides.
:01:37. > :01:43.Michelle, what are the two companies saying about the split? We have
:01:44. > :01:46.heard from Omnicom, saying that essentially this was a breakup
:01:47. > :01:51.they've blamed on difficulties tried to get the deal done in a timely
:01:52. > :01:56.fashion. It was a sentiment echoed also by Publicis. There were also
:01:57. > :02:01.problems with costs that were mounting, problems on the legal
:02:02. > :02:05.side, and issues relating to taxes. Some observers have also been
:02:06. > :02:10.speculating that it was more than that. That there were problems
:02:11. > :02:13.behind the scenes, amongst the personalities trying to merge the
:02:14. > :02:19.two cultures. Weston is being raised about who would lead the agency
:02:20. > :02:30.going forward `` questions were being raised. I heard that the
:02:31. > :02:43.merger was never definite, but there was never a certainty. All along, he
:02:44. > :02:50.has said that, he has been sceptical. The advertising industry
:02:51. > :02:56.is full of larger`than`life personalities, perhaps that was part
:02:57. > :03:00.of this. Also, if you look back at Martin Sorrell, who runs the
:03:01. > :03:05.world's second biggest advertising agency, he has pointed out that if
:03:06. > :03:09.you look at these two agencies, combine together they have many
:03:10. > :03:13.competing clients. For example, one of the great rivalries in corporate
:03:14. > :03:19.America is between Coca`Cola and Pepsi. They were each represented by
:03:20. > :03:22.Publicis and also by Omnicom, so there were questions over how these
:03:23. > :03:26.two accounts will be managed, and the same question again with other
:03:27. > :03:32.clients. The client had yet to be persuaded of the necessary logic of
:03:33. > :03:35.this deal, but of course the advertising industry has changed,
:03:36. > :03:38.the landscape is shifting, you have more and more adverts being placed
:03:39. > :03:42.on sites like Facebook, technology companies entering into the market,
:03:43. > :03:47.so the question going forward will be, what will these two agencies
:03:48. > :03:50.look like in the future? Exactly, I was just thinking as you are
:03:51. > :03:56.speaking, I don't think this is the last we have heard of this.
:03:57. > :04:00.More encouraging economic news from China this morning, with evidence
:04:01. > :04:04.that inflation eased last month. Let's get the latest from Rico Hizon
:04:05. > :04:16.in Singapore. Good to see you as ever. Inflation is easing? Yes, and
:04:17. > :04:21.yet the market here in Asia with the news, prices are coming down a bit.
:04:22. > :04:25.The data gives the government more leeway if needed to stimulate the
:04:26. > :04:33.slowing economy, consumer prices are rising by 1.8% over a year earlier.
:04:34. > :04:40.Down from March's 2.4% increase, and that was led by the politically
:04:41. > :04:45.sensitive food prices. This gives Asia a bit more room for other
:04:46. > :04:54.initiatives to stimulate the economy after growth declined to 7.4% in the
:04:55. > :04:57.latest quarter. In a sign of concern over possible job losses in the
:04:58. > :05:01.weaker economy, Beijing launched in March a mini stimulus initiative,
:05:02. > :05:08.boosting spending on building railways and other public works.
:05:09. > :05:18.Despite this good news, analyst say the economy may have bottomed out,
:05:19. > :05:22.but the recovery will be slow. Over the last three days, we have been
:05:23. > :05:27.reporting from the World Economic Forum, taking place in Abuja,
:05:28. > :05:31.Nigeria. Government and business leaders there were attending the
:05:32. > :05:38.event, known as Africa's Davos, to be a global showcase for Nigeria as
:05:39. > :05:42.a fast`growing economy, full of opportunity. It has been
:05:43. > :05:46.overshadowed by concerns over the stability and security of the
:05:47. > :05:51.country. We put those concerns to the head of Nigeria's largest
:05:52. > :05:59.private energy company. The risk that really affect investments is
:06:00. > :06:03.not in Nigeria. Would you have in Nigeria is challenges, in terms of
:06:04. > :06:10.building a business. The ultimate aim in business is to make a good
:06:11. > :06:13.return, and Nigeria has come at it and returned in many places. There
:06:14. > :06:18.may be challenges where we have to build some infrastructure,
:06:19. > :06:22.challenges with getting licences, soft challenges in terms of getting
:06:23. > :06:28.business started. Once you are up and running, it is a success. If you
:06:29. > :06:33.look at it from the point of view of large corporations and the telecoms
:06:34. > :06:41.industry, where we had in 2000 two problems with the licensing process.
:06:42. > :06:43.Two companies got licences, and we became the largest market
:06:44. > :06:48.eventually, but they had to content with many things. Let's have a look
:06:49. > :06:52.at the euro, because since the US and debt crisis receded in the
:06:53. > :06:55.region's economies began to recover, the single currency has
:06:56. > :07:00.really bounced back. Too strongly in, in fact, for many in France,
:07:01. > :07:06.where business leaders are complaining it is hitting their
:07:07. > :07:13.profits at making their exports unviable. President Francois
:07:14. > :07:19.Hollande is beginning talks with Angela Merkel today. Against the US
:07:20. > :07:26.dollar on Thursday, the euro touched almost 1.40 cents, which is the
:07:27. > :07:29.highest in around 2.5 years. The euro has also surged almost 14%
:07:30. > :07:34.against the dollar since the summer of 2012. That has made things tough
:07:35. > :07:42.for European firms competing with US rivals. On Thursday, the European
:07:43. > :07:46.Central bank boss underlined his own concerns about the strength of the
:07:47. > :07:53.euro. The strengthening of the exchange rate in the context of low
:07:54. > :07:59.inflation is cause that is in view of the governing council. We are
:08:00. > :08:02.speaking to a senior economist at Westpac bank. A cause for serious
:08:03. > :08:07.concern. What do you make of those comments? Think he is making the
:08:08. > :08:11.point that already very low inflation in the eurozone risks
:08:12. > :08:17.becoming even lower, potentially even deflationary, if the euro were
:08:18. > :08:21.to insist on deflating. Your central bank is one of the few that hasn't
:08:22. > :08:26.gone down the quantitative easing path. The Bank of England has, the
:08:27. > :08:32.Bank of Japan, the Fed in the US. That tends to weaken currencies, so
:08:33. > :08:35.with this there is talk about some easing potentially coming through
:08:36. > :08:40.from the ECB potentially next month, could there be some hint of
:08:41. > :08:45.quantitive easing down the path for the ECB? We think there could be.
:08:46. > :08:51.What do you think your reaction could be that? What if the ECB goes
:08:52. > :08:57.down that path? You would think it would weaken the currency, and that
:08:58. > :09:01.is the hope. He has done some pretty awesome things, reversing policy
:09:02. > :09:06.errors in his first two meetings, the long`term refinancing operation,
:09:07. > :09:13.sorting out the banking credit crunch in 2011. Portuguese
:09:14. > :09:19.government bond yields have them down to 3.5%. He has done a lot, and
:09:20. > :09:26.he does something along the lines of quantitive easing, which we thought
:09:27. > :09:32.would not be possible, they can't fight government bonds. There is no
:09:33. > :09:38.asset back market to speak of, but if he manages to come up with a QE
:09:39. > :09:42.plan, he might be rewarded, that is the curse of the courageous. If he
:09:43. > :09:47.gets that sort of a response it could be problematic. Lots for
:09:48. > :09:58.Angela Merkel and Francois Hollande to talk about.
:09:59. > :10:06.Apple is close to paying $3.2 billion for Beats electronics. They
:10:07. > :10:09.are the maker of the trendy headphones, which also runs a
:10:10. > :10:17.subscription music service, and was founded by Doctor dre in 2008. It
:10:18. > :10:23.would be Apple's biggest ever takeover, if it goes through.
:10:24. > :10:30.Analysts say they are puzzled by it. Asian shares slumped on Friday,
:10:31. > :10:42.because of caution from investors about the situation in Ukraine.
:10:43. > :10:57.I will be back in a moment relook at the papers. `` for a look.
:10:58. > :11:03.The government is being urged to make big changes to the way
:11:04. > :11:07.terrorism is tackled in Britain, in order to deal with groups like Al
:11:08. > :11:15.Qaeda. The home affairs committee says the Metropolitan Police should
:11:16. > :11:16.be stripped of its responsibility for counter`terrorism. Just 18