31/12/2015 World Business Report


31/12/2015

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Those are the latest headlines from BBC World News.

:00:00.:00:00.

Now for the latest financial news with Maryam and the

:00:00.:00:00.

With a new trade deal with the EU coming into effect tomorrow,

:00:00.:00:20.

Ukraine is turning its back on its old partner Russia.

:00:21.:00:23.

But are the Russians taking it sitting down?

:00:24.:00:38.

We'll take a closer look at the art market, where there are

:00:39.:00:41.

signs that the rich may not be as willing to splash out on a bit of

:00:42.:00:45.

Welcome to World Business Report, I'm Maryam Moshiri.

:00:46.:00:51.

In a minute, Mariko in Singapore will take a look back

:00:52.:00:53.

But first: On January 1st a free trade deal comes into effect between

:00:54.:00:59.

Ukraine is ready to pay the price for a trade deal with the

:01:00.:01:04.

European Union, President Petro Poroshenko has said after Moscow

:01:05.:01:06.

moved to restrict its trade ties with Kiev over the accord.

:01:07.:01:14.

Controversy over the trade deal was the initial trigger of unrest

:01:15.:01:17.

in Kiev that culminated in the ousting of a Moscow-allied

:01:18.:01:19.

Russia then annexed Crimea and backed a separatist revolt

:01:20.:01:23.

in eastern Ukraine, in moves that led to Moscow's worst

:01:24.:01:25.

At this juice factory, business is on track for a boost. Come January

:01:26.:01:46.

one, the company and Ukraine will have unfettered access to the new

:01:47.:01:55.

market. If all goes to plan, this juice will satisfy more and more

:01:56.:01:59.

Europeans. Russia says it economy will suffer from the deal. The

:02:00.:02:04.

Kremlin will slap restrictions on Ukrainian goods in the new year. It

:02:05.:02:13.

says that the trade zone will help lessen the pain. Russia is a

:02:14.:02:18.

sufficiently large part of our exports. But we hope to make it

:02:19.:02:26.

bigger. The trade zone cannot come at a more critical time. Ukraine's

:02:27.:02:32.

economy is in deep recession. You can's economic problems actually

:02:33.:02:35.

help the club right now. This juice is relatively cheap to produce, and

:02:36.:02:41.

less expensive than its European rivals. When the markets open up,

:02:42.:02:48.

Ukrainian businesses are going to face a number of challenges --

:02:49.:02:54.

Vitmark. The trade is to weigh. European goods are free to enter

:02:55.:03:00.

Ukraine, and companies must now adapt to European standards, which

:03:01.:03:05.

cost time and money -- two-way. Competition won't be so stiff in the

:03:06.:03:09.

juice business, but it will be in technology and heavy industry. You

:03:10.:03:20.

get the element of, pretty much like those exporters are not in a

:03:21.:03:27.

position to remodel themselves to more sophisticated markets. The free

:03:28.:03:32.

trade zone is more than a decade in the making. If it feels the European

:03:33.:03:41.

dreams of many Ukrainians. Two years ago, they took to the streets to

:03:42.:03:44.

protest its cancellation and drove the then president from power. It

:03:45.:03:51.

remains to be seen if their expectations of a bright European

:03:52.:03:52.

future will be realised. On this the last day of the year,

:03:53.:03:57.

it's traditional to look back Mariko Oi is in our

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Asia Business Hub in Singapore Let's start with a good one.

:04:02.:04:18.

Japan's shares have had a fairly good year. We finished trading

:04:19.:04:25.

yesterday, ending the year higher. More than 9%, and above the 19,000

:04:26.:04:33.

level for the first time in two decades. Shinzo Abe said that

:04:34.:04:40.

economic policies have been working in terms of boosting stock prices.

:04:41.:04:46.

South Korea also ended the year on a high, but only by two and a half %.

:04:47.:04:52.

Australia has had quite a tough year with shares, which ended lower today

:04:53.:04:57.

and down by about 2% of the year. That is mainly because of commodity

:04:58.:05:03.

shares, the mining boom which came to an end because of the slowing

:05:04.:05:09.

growth in China which was the biggest importer. Chinese shares

:05:10.:05:15.

have had an extremely volatile year. We still have a few more hours of

:05:16.:05:19.

trading in Shanghai, they are down slightly today it got up near 10%.

:05:20.:05:27.

And till June, they were up by 150% by losing almost a third of their

:05:28.:05:31.

value in three weeks. The government intervened fairly quickly and shares

:05:32.:05:39.

have recovered by about 25%. Hong Kong shares have been affected by

:05:40.:05:46.

that volatility in China. They seem to be ending the year down by more

:05:47.:05:55.

than 7%. Looking forward to 2016, what kind of sentiment you think

:05:56.:06:01.

investors have within the markets in Asia looking forward to the new

:06:02.:06:05.

year? I think that the interest rate hike in the US, which many people

:06:06.:06:12.

here in Asia have been anticipating for a long time, I think a lot of

:06:13.:06:18.

people will be watching what the Federal bank will do next. The

:06:19.:06:24.

gradual pace that the chair has been talking about, it is being monitored

:06:25.:06:30.

very carefully and how that would affect shares and currencies in

:06:31.:06:36.

Asia. That will be closely monitored. What are your plans for

:06:37.:06:47.

New Year's Eve? Where I come from, we tend to watch a singing

:06:48.:06:50.

competition between male and female singers in Japan. I plan to watch

:06:51.:06:54.

that with my parents who are visiting Singapore tonight. My

:06:55.:06:59.

biggest challenge may be not to fall asleep. Thank you very much.

:07:00.:07:04.

The art market has made headlines this year,

:07:05.:07:06.

So does that mean the art market is back to

:07:07.:07:11.

the boom times of the 2000's, before the global financial crisis?

:07:12.:07:14.

Well, despite these headline grabbing

:07:15.:07:15.

sales, it seems the rich are having second thoughts about splashing

:07:16.:07:18.

their cash around the auction rooms, as Jeremy Howell reports.

:07:19.:07:33.

A December evening at this auction house in London, an auction of

:07:34.:07:46.

famous painters. Most works sold at the lower end of the estimated price

:07:47.:07:50.

range. It is a subdued and to the year. Markets flew higher last week.

:07:51.:07:57.

This painting sold three record-breaking $178 million. This

:07:58.:08:03.

painting sold for $170 million. These aside, the appetite for

:08:04.:08:11.

purchasing at may be waning. China has seen a slowdown in economic

:08:12.:08:17.

growth. At the top of the market, billionaires who are keen to get a

:08:18.:08:22.

great work by a famous artist like the Kiso, there is still a lot of

:08:23.:08:26.

competition. Once you go under that, where we are talking about millions

:08:27.:08:31.

of dollars, people are feeling more squeezed. There is less confidence.

:08:32.:08:37.

Russians are feeling much poorer. People in general are feeling

:08:38.:08:43.

poorer, and that has had an impact. The demand for works by contemporary

:08:44.:08:48.

artists, which had been booming, are now starting to subside. People have

:08:49.:08:58.

been advised by curators of an upcoming artist. They take the word

:08:59.:09:01.

that upcoming means growing in value. What they stop believing in

:09:02.:09:09.

that, they follow their hearts. It is easier to see virtually in an old

:09:10.:09:17.

master. You would think those were a more solid investment. As the most

:09:18.:09:23.

rich veer away from investing in contemporary art, old Masters become

:09:24.:09:28.

a mainstay of the market. In other news: Troubling times

:09:29.:09:36.

for Puerto Rico, the country will default on about $37 million

:09:37.:09:39.

in bond payments due Jan. 1, escalating a conflict with

:09:40.:09:42.

investors as Governor Alejandro Garcia Padilla seeks to

:09:43.:09:46.

restructure a massive debt burden. The amount is just a fraction

:09:47.:09:54.

of the almost $1 billion in interest Garcia Padilla has warned

:09:55.:09:58.

for weeks that if forced to choose between paying creditors

:09:59.:10:02.

and paying for essential services, The Brazilian currency, the real,

:10:03.:10:04.

has weakened again in trading It fell on Wednesday

:10:05.:10:08.

by nearly 2% against the US dollar. So far this year the Brazilian

:10:09.:10:21.

currency has dropped in value by almost 33%, the weakest

:10:22.:10:24.

performance of any of the world's Shares of

:10:25.:10:27.

Weight Watchers International have piled on the dollars, up 27 percent

:10:28.:10:30.

over the past two days after Oprah Winfrey debuted a campaign

:10:31.:10:47.

endorsing the weight-loss program. The celebrity

:10:48.:10:49.

and media mogul posted a video to her Twitter account about using

:10:50.:10:52.

Weight Watchers to lose weight. Winfrey announced her partnership

:10:53.:10:54.

with Weight Watchers in October, saying she would buy 10 percent

:10:55.:10:56.

of the stock and join the board. Asian stock markets were mixed

:10:57.:10:59.

in thin trading Thursday after the latest decline in oil

:11:00.:11:02.

prices pulled Wall Street lower. Markets in Japan and South Korea

:11:03.:11:05.

were closed for the New Year Losses in energy stocks weighed

:11:06.:11:08.

on Wall Street on Wednesday and Oil prices look like they are ending the

:11:09.:11:16.

year how they began, under pressure. Brent crude skid toward 11-year lows

:11:17.:11:19.

after an unusual build in US stockpiles and signs Saudi Arabia

:11:20.:11:22.

will keep adding to More from me throughout the day, but

:11:23.:11:24.

for now, goodbye. Here in Britain, a couple who

:11:25.:11:39.

plotted a terror attack in London Mohammed Rehman and his wife Sana

:11:40.:11:42.

Ahmed Khan, both in their 20s, were convicted of preparing terrorist

:11:43.:11:46.

acts, and will serve a combined

:11:47.:11:50.

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