13/06/2014 World Business Report


13/06/2014

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Bowe Bergdahl will remain there for further treatment. Those are the

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latest headlines from BBC World News. Now for the latest financial

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news with Alice and World Business Report. An end in sight to South

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Africa's longest strike, but the nation's problems run far deeper.

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Plus, clicking with confidence. New EU rules to protect the online

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shopper. moment. But let's begin in South

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Africa, where an end could finally be in sight to the longest strike in

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the 130`year history of the country's mining industry. On

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Thursday the three top platinum firms announced they had reached

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in`principle undertakings with union leaders to break the five`month

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deadlock over pay. These pictures show a huge rally of the AMCU union

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on Thursday, where workers appealed to leaders to sign the pay deal. The

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strike has meant huge hardship for them, as well as serious economic

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damage for the mining industry and the country as a whole. Labour

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unrest is pushing South Africa towards recession, and later today

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it could see its credit rating downgraded, an indication that

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international investors are losing confidence. Our Africa Correspondent

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Andrew Harding reports. 20 weeks now, and counting. The miners'

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strike which is pushing South Africa towards recession. Workers are no

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longer willing to accept the status quo, demanding that their basic pay

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should be more than doubled. It is an attitude which is spreading.

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Workers are beginning to get frustrated, after 20 years of

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democracy, things have not changed for them. Things might have changed,

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but if you go to coalitions of employment, salaries of workers are

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getting less. Industrial action now threatens to spread to steel plants

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like this one. The owners are worried that South Africa's

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governing alliance is offering mixed messages, not concrete action. I

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think at some point, the ruling party is going to grasp the nettle

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and say they stand for this and will put people back to work. They will

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make tough and hard decisions, and eventually, sanity will prevail. If

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they do not do that, it will just be an ongoing, steady decline into

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recession. On a continent with plenty of booming economies, South

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Africa has become an increasingly worrying exception. Relations

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between investors, government, and workers, have not been this

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problematic for a long time. That is the challenge. The nature of Labour

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is changing. Trust between Labour and the employers has completely

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been shattered. And it doesn't exist. Trust between workers and

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their leaders within the unions is about to be broken. Here is the

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proof of that. Tensions rising in the Platinum mines. This worker's

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home was torched because he wanted to end the strike and return to

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work. The people are scared because of the violence which is happening.

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People are intimidated when they want to go back to work. Everyone is

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afraid of his life. So for now, mines like this remain closed.

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Resilient but obstinately unequal country slouches towards recession.

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Lebohang Pheko runs the development consultancy, Four Rivers. He is in

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our Johannesburg studio. `` she joins us. Good to see what

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programme. We may be now seeing the end of this longest running strike

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in South Africa's mining industry. But the problems in the country

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spread far beyond this, don't they? Well, I mean, I think there are a

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couple of things. It is way beyond London to Anglo`American mines and

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also to Platinum mines. It has also gone into the quarrying industry and

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the steel and cement industries. It is trickling into manufacturing as

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well, which has seen a recession of about 0.7%. And the quarrying

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industry has seen about 1.3% of lost. Link to that is the decrease

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in capital flows arising from the mining sector, which are still quite

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reliant. There is the risk that will make inflation might also begin to

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creep up again, which is what the Reserve Bank tries very hard to keep

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under control as part of the key monetary and fiscal instruments. So

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I mean, that of course may well have an impact on consumer affordability

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of a whole range of things. And related to this is a crisis in

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electricity and the supply. There is a lot of load sharing taking place

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at the moment which also hampers the activity of the mining sector. So

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there is a trickle`down effect in other sectors and in other realms.

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Indeed, as you say, there are talks of strikes happening in the gold

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industry, the steel industry as well. We saw the economy in South

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Africa contract in the last quarter. There is a risk it could

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happen in the next. Are you worried that the country might enter a

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period of recession? We are also of course awaiting the latest ratings

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from each and Moody 's. What are you expecting from that? `` Fitch. We

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will see. I have found some of the ratings downgrades unfair and

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unfounded. In the last year or two we have been puzzled, because

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certainly countries like for example Egypt, who managed to retain a

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particular rating despite the great turmoil that, so there are some of

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us who might not use that as too much of an index, but certainly in

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terms of our own domestic policy about domestic economic policy

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direction, we need to think about what we want our Labour industry to

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look like and where we want to position it over the next five or

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ten or 15 years. And I think that these strikes illustrate the extent

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to which we can't rely on the mining sector in the same way that we have

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previously. The way that we need to really think about reskilling a

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whole generation of workers. And a way that we really need to

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rehabilitate a very historically fractious relationship, particularly

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in the mining sector, which has been a sight of struggle even pre`

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apartheid. Restoring that issue of trust we heard in the film earlier.

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Thank you for joining us live from Johannesburg. Online shopping has

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seen massive growth in recent years, and from today consumers in Europe

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will get more protection when buying over the internet, as new rules come

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into force across the 27 EU member states. It is called the EU Consumer

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Rights Directive. Here are some of the things it will mean. A 14`day

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cooling off period, in which consumers can return products bought

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online A ban on "pre`ticked" boxes for additional services, a common

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one is travel insurance when buying a holiday. Refunds within 14 days of

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goods being returned. A ban on excessive surcharges for using a

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credit or debit card, for instance when buying flights. And a ban on

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excessive charges for customer service phone lines. Philip Smith is

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from Trusted Shops, a website which certifies online retailers who sign

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up to a code of conduct. He is in our North of England studios. Good

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to see you. These changes to regulations, they are long overdue,

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aren't they? We have all been shopping online for quite sometime

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now. Yes, basically the idea behind the directive is that they harmonise

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these laws across the member states in Europe. So they will be

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effectively replacing the distance selling regulations that we have

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particularly in the UK. So they will be implemented in the UK through the

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consumer contract regulations. So distance selling regulations that we

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have which came into force back in 2000 will basically be replaced by

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this new directive. And how will this new directive be enforced? Will

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all websites that we go to, whether we are buying an item of clothing or

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buying a flight, will they all have to sign up to these new directive

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is? Yes, when you are shopping online, any online retailer is going

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to have to make these changes. So it's really important that they do

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that. And this kind of `` there are kind of four main areas they will

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have to change. One will be the order button, so when a consumer

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reaches the checkout the button will not be allowed to say goodbye, or

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order now, any more. It will have to explicitly inform the consumer they

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are entering into a contract and will have an obligation to pay. So

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some of the rules may seem quite small, just changing the wording on

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a button. If a retailer doesn't change that wording, they are not

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actually entering into a contract with the consumer. It is very

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important retailers make these changes. OK, we can all start

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clicking away with a bit more confidence. Thank you for talking us

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through that new directive. In other business News: The Governor of the

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Bank of England Mark Carney has warned UK interest rates could rise

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"sooner than financial markets currently expect". He was speaking

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at the Lord Mayor of London's annual banquet. UK borrowing costs have

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been at a record low of 0.5% since 2009. The comments sent the pound,

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already at a five`year high, up sharply. Russian gas exporter

:10:15.:10:22.

Gazprom says it will halt supplies to Ukraine, if it fails to pay

:10:23.:10:23.

Ukraine owes some $4 billion for gas, a figure disputed by Kiev. The

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row has unsettled politicians in Europe, which gets half of its

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Russian gas via pipelines that cross Ukraine. But so far EU`brokered

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talks have failed to get the two sides to agree.

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