:00:00. > :00:17.Now for the latest financial news with World Business Report.
:00:18. > :00:19.Businesses make moves to tighten security or face data theft and
:00:20. > :00:23.And as Brazil suffers its worst recession
:00:24. > :00:33.for 25 years what impact will a rise in US interest rates have?
:00:34. > :00:36.Businesses make moves to tighten security or face data theft and
:00:37. > :00:40.And as Brazil suffers its worst recession
:00:41. > :00:43.for 25 years what impact will a rise in US interest rates have?
:00:44. > :00:45.Welcome to World Business Report I'm Sally Bundock.
:00:46. > :00:48.Also in the programme Australia warns its budget deficit will swell
:00:49. > :00:50.by an extra $2.3 billion due plunging commodity prices.
:00:51. > :00:59.2015 has seen a series of high level global cyber security
:01:00. > :01:02.attacks on businesses, so much so that later today British politicians
:01:03. > :01:13.will debate solutions with some high profile Chief Executives.
:01:14. > :01:16.The urgent message to protect against cyber vulnerabilities has
:01:17. > :01:20.But now there is a shift towards the need to tighten security or
:01:21. > :01:22.face data theft and potential financial embarrassment.
:01:23. > :01:24.For example in October phone company, Talk Talk,
:01:25. > :01:27.It lost valuable customer data and business reputation.
:01:28. > :01:30.Hackers accessed personal details of almost 157 thousand customers,
:01:31. > :01:43.including more than 15,000 bank account numbers and sort codes.
:01:44. > :01:46.And they're not the only ones - Paypal, eBay, JP Morgan and Sony
:01:47. > :01:50.Globally, the cost of hacking is on average
:01:51. > :02:03.In the UK alone its estimated that hacking costs firms a total
:02:04. > :02:10.27 billion of that is lost revenues as the
:02:11. > :02:13.result of attacks with the other $24 billion spent on firms defending
:02:14. > :02:23.Mark Brown is Executive Director of Cyber Security at EY UK.
:02:24. > :02:35.Nice to see you. Tell us a bit more about today's Summit. It has been a
:02:36. > :02:41.long time coming in many respects. The UK government is looking at the
:02:42. > :02:47.issue. Businesses are starting to recognise it is not just a
:02:48. > :02:53.technology issue. It has been pushed out by the UK government for the
:02:54. > :02:58.last few years, to raise awareness among executive management, so they
:02:59. > :03:07.cannot just of all this down to technology. -- push this down to
:03:08. > :03:12.technology. They need to look at what is being done. And what needs
:03:13. > :03:17.to be done, given the EU thinks needs to be done, there is a bit of
:03:18. > :03:24.friction with how it is. With and what happens when companies are
:03:25. > :03:30.hacked? There is a legislative question coming from the EU. The
:03:31. > :03:41.European general day to privacy recommendations. -- data. Businesses
:03:42. > :03:48.have, for a long time, probably we are only looking at the tip of the
:03:49. > :03:54.iceberg with what we are searing it makes
:03:55. > :04:04.it will bring, for the first time, real finding power is to
:04:05. > :04:10.regulators. Companies, is 5000 or more customers are that by cyber
:04:11. > :04:15.hacking, the company will have to divulge that publicly and could face
:04:16. > :04:22.potential fines if the EU directive is implemented? Yes. The position
:04:23. > :04:28.from Europe is that national governments will have to implement
:04:29. > :04:35.this. We expect by late 2018 the government will introduce this
:04:36. > :04:41.international statute. It will be a change to traditional approaches in
:04:42. > :04:48.the UK to empower regulators to take punitive action on businesses. In
:04:49. > :04:54.terms of how prepared companies are globally to see how prepared they
:04:55. > :05:01.are, how prepared are they? We as consumers and customers always worry
:05:02. > :05:08.about where our data will end up. Our clients are telling us that most
:05:09. > :05:15.of them are not prepared. We conduct an annual survey, and this year's
:05:16. > :05:17.report issued that 80% of organisations felt their security
:05:18. > :05:25.function was not meeting the needs of the business. Just under 50% did
:05:26. > :05:29.not have the required functions to manage cyber security. Just over a
:05:30. > :05:33.third of organisations felt they would not know it if a certain
:05:34. > :05:42.breach was happening. Those are quite scary. Thank you. Perhaps some
:05:43. > :05:46.EU fines might change some of that. Any news coming out of that meeting
:05:47. > :05:48.today with chief executives and the UK government on such security, we
:05:49. > :05:51.will update you. As the US prepares itself
:05:52. > :05:52.for potentially its first interest raise since 2008
:05:53. > :05:55.- not everyone is cheering. For the past seven years,
:05:56. > :05:57.investors seeking high returns placed a lot of their capital
:05:58. > :06:00.in emerging economies like Brazil, which offered good returns but
:06:01. > :06:02.at considerably high risks. If rates go up in the US,
:06:03. > :06:06.there's incentive to get money out of emerging markets
:06:07. > :06:08.which could impact places like Brazil, which is already suffering
:06:09. > :06:19.its worst recession in 25 years. The BBC's South America Business
:06:20. > :06:33.correspondent Daniel Gallas reports Brazil's economy enjoyed the best
:06:34. > :06:38.seven years of low interest rates in the United States, during most of
:06:39. > :06:43.that period there was an increase in foreign capital from the United
:06:44. > :06:50.States into emerging markets. Brazil had solid growth and received
:06:51. > :06:56.investment grades from credit ratings agencies. But now they could
:06:57. > :07:05.be some trouble in Brazil. The country is already facing its worst
:07:06. > :07:10.recession in two decades with a, -- reduction in commodity prices. The
:07:11. > :07:19.decision from the Federal reserve is not helping. Brazil needs any help
:07:20. > :07:22.it can get from markets abroad. Some believe the Brazilian currency has
:07:23. > :07:31.devalued already and there is not much time the Federal reserve could
:07:32. > :07:34.do. -- harm. Borrowing costs could rise in Brazil and less capital is
:07:35. > :07:37.not good news for a country that needs a lot of help right now.
:07:38. > :07:40.The Australian government has forecast its budget deficit will
:07:41. > :07:42.swell to more than $27 billion in the year to June.
:07:43. > :07:45.It's largely being blamed on falling prices for its resource exports.
:07:46. > :07:49.Despite this, the government is planning to come up with a way to
:07:50. > :07:58.pay for its $800 million initiative to inspire a bolder entrepreneurial
:07:59. > :08:16.People are Australia's greatest resource. The Prime Minister,
:08:17. > :08:21.Malcolm Turnbull, believes future prosperity will depend on their
:08:22. > :08:27.ideas and their ability to innovate. The long-running mining boom he
:08:28. > :08:32.continues to fade. Making Australia's freight network move
:08:33. > :08:41.more efficiently is the driving force behind the new start-up from a
:08:42. > :08:45.mathematician. She is now helping firms buy and sell spare capacity.
:08:46. > :08:51.She is excited by the Prime Minister's plans. We are on the cusp
:08:52. > :08:57.of a huge social change. It is going to be so much better for so many
:08:58. > :09:01.more people. You are building a far more sustainable and exciting
:09:02. > :09:07.culture, I think. Innovation is one of our strengths. But some
:09:08. > :09:13.established companies believe Australia still has some way to go
:09:14. > :09:19.to create a smarter economy. This engineering firm in Sydney exports
:09:20. > :09:22.computer-controlled machines that craft industrial textiles. The
:09:23. > :09:26.managing director says he is often frustrated with the government,
:09:27. > :09:30.which needs to do more to promote the spirit of creativity. We have a
:09:31. > :09:35.culture of innovation in Australia, but we do not have a culture of
:09:36. > :09:41.funding innovation. We are going to have a hard time, I would say. We
:09:42. > :09:45.have to go through a period where there are not enough people thinking
:09:46. > :09:51.innovatively, not enough people going into engineering and science.
:09:52. > :09:54.To become an increasingly clever country, Australia wants to harness
:09:55. > :09:58.the brainpower of foreigners. Those with bright ideas for start-ups will
:09:59. > :10:01.be given the chance to live here permanently and be a part of an
:10:02. > :10:07.innovation revolution. Police forces are on the verge
:10:08. > :10:21.of being overwhelmed by a surge in reports of domestic violence,
:10:22. > :10:25.according to the police watchdog It comes as three-quarters
:10:26. > :10:29.of police forces are judged by the