08/06/2016 World Business Report


08/06/2016

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Now for the latest financial news with Sally,

:00:00.:00:00.

The final super Tuesday and Hillary Clinton claims victory

:00:00.:00:19.

as the Democratic nominee, racing against Trump

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to the White House, so what does this mean

:00:22.:00:23.

And will shareholders take on Sir Martin Sorrell?

:00:24.:00:32.

He is the boss of the worlds biggest ad firm, WPP,

:00:33.:00:35.

Also in the programme: The World Bank slashes

:00:36.:00:47.

Our team in Singapore will have the details.

:00:48.:00:54.

She did it - Hillary Clinton has claimed victory

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as the Democratic Party's presidential nominee.

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As expected she saw a resounding win in the primary election

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in the states of New Jersey and New Mexico, she becomes

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the first female presidential nominee of any major political party

:01:07.:01:09.

It pits her against Republican presidential candidate Donald Trump.

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So what does it mean for the US economy?

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Jacob Parakilas is assistant head of the US and the Americas Programme

:01:19.:01:23.

at Chatham House, the Royal Institute for International Affairs

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So, here are! We talked about this before and we assumed we might get

:01:26.:01:41.

to this point, but we now have arrived. Give us your take on how

:01:42.:01:47.

this will play out. It has been an interesting couple of news cycles.

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There was the surprise announcement by the HP last night that they had

:01:51.:01:55.

tallied up the super delegates and come to the conclusion that Clinton

:01:56.:02:02.

had sealed the nomination. But Bernie Sanders said, hold on, we

:02:03.:02:09.

want to wait until we are at the end. But the numbers seem pretty

:02:10.:02:13.

clear that Hillary Clinton has a majority of pledged delegates, which

:02:14.:02:20.

would make it impossible for Bernie Sanders to gain more delegates than

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Hillary. She has made a big point of the fact that she is the first

:02:29.:02:36.

female to reach this point, but others are quick to point out that

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she would not necessarily be where she is but for the fact that she is

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supported by super superdelegates, and drawing attention to how she is

:02:53.:03:02.

funded, et cetera. She -- Bernie Sanders said, I am the only

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antiestablishment candidate left, come over to my site. I don't know

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that this will make much of the difference in the electorate. Most

:03:14.:03:23.

Sanders supporters... Usually, if there is a left and a right wing

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candidate, most of the supporters will stay on the side that they were

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originally on. Trump and Sanders have a very thin level of policy

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convergence. So, it is hard to see that making a real impact. It might

:03:47.:03:52.

make an impact on the margins in a few States, but I don't think it

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will be a major factor. I know I will speak to you again, there is

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much to discuss between now and November. We will cover every twist

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and turn. The World Bank has lowered

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its forecast for the global economy, saying it will grow by just

:04:06.:04:08.

2.4% this year instead That is quite a reduction,

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so what has changed? Sharanjit Leyl is in

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Singapore for us. A gloomy forecast, fill us in? When

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I spoke to one of the authors of this global outlook, he essentially

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said that the main reason for the revision was the slowdown in global

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trade activity. Essentially, the bank warning that the world economy

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is increasingly vulnerable to a sharp slowdown. Advanced economies

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are struggling to Grove, and they have cut their forecast.

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Essentially, the reason for all of this is commodity exporters

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suffering, with some of the largest downward revisions. They pared their

:04:57.:05:02.

projections for the US economy, the world's largest. They are saying the

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slowing energy sector, the strong dollar, dismal global demand, all

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culminating in a cut for growth expectations to 1.9% for the year.

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They kept the forecast for China at 6.7%, which is really due to ageing

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propelling output with more stimulus, but they are warning that

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Beijing may have oblongs of financial risk that could trigger a

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deep slide in growth. I don't think much of Japan's economy, which they

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revised down by almost 1% for the year.

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Executive pay is once again in the headlines as shareholders

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seek to vent their frustration at bumper pay packets for CEOs.

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Today it's the turn of Sir Martin Sorrell,

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The Chief Executive of the world's largest advertising agency,

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WPP to face investors at the firm's Annual General Meeting.

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Mr Sorrell is the highest paid CEO in the FTSE 100 and is in line

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for a total compensation package of around $102 million

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With me is Dr Hans-Christoph Hirt, executive director and board member

:06:02.:06:17.

It represents more than 40 pension funds, many of whom have WPP shares

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in them. You are speaking at the AGM, what are you going to say? We

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are going to express our gratefulness to Sir Martin for

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creating a lot of value, and one of the greatest issues is his

:06:44.:06:47.

succession planning, and the risk around his succession. We will also

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talk about remuneration and that package, which we regard as

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excessive. What do you think is a fair pay deal for him? I think that

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is for the board to decide, and for the remuneration board to decide.

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But they have decided, they have given him $102 million. Yes, but we

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have concerns about the independence and effectiveness of the board. Is

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it necessary to pay that amount to one person, does a motivate Sir

:07:26.:07:34.

Martin. What are the people think we are working for, the beneficiary of

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pension funds? There are a lot of concern throughout this passage. Is

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very strong in arguing that he is worth it, that without him the

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company would not be what it is today. At the same time, to put it

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in perspective, he is getting around 100 million dollars. The next to

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ours oil majors, and they are getting about $35 million, which is

:08:05.:08:14.

a big difference. It is a big jump. And most of it is shares anyway, the

:08:15.:08:21.

shares go up, so he gets more money. The question is how much is

:08:22.:08:25.

necessary. Governance in the UK is very clear, company should not pay

:08:26.:08:30.

more than is necessary, and they should ask if it really motivates

:08:31.:08:34.

him. Next year his pay is likely to be smaller, does that mean he will

:08:35.:08:39.

leave? It is unlikely from our perspective. These are the questions

:08:40.:08:42.

the remuneration committee should be asking. Thank you for your time

:08:43.:08:46.

today, we will also be watching that AGM closely.

:08:47.:08:53.

Japan's growth rate for the first quarter of 2016 has been revised

:08:54.:08:56.

Markets in Tokyo fell in early trading as the higher GDP figure

:08:57.:09:00.

reduced the chance of further economic stimulus measures

:09:01.:09:03.

Societe Generale says it will appeal against a scandalous decision

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by a French tribunal, which ruled its dismissal

:09:07.:09:08.

Ex-trader Jerome Kerviel made unauthorised transactions

:09:09.:09:24.

The Paris tribunal ruled Jerome Kerviel's former employer

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should also pay him half a million dollars in damages.

:09:29.:09:42.

The good news about Japan does not help its buckets. The yen is a

:09:43.:09:56.

little stronger, Brent Crude above $15 a barrel, which is interesting.

:09:57.:10:09.

Police say they're hoping new developments in DNA profiling

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will help catch the killer of a young woman in Bath.

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Melanie Hall was last seen alive in a city nightclub 20 years

:10:15.:10:18.

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