Browse content similar to 04/07/2016. Check below for episodes and series from the same categories and more!
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The British Finance Minister wants to promote the country as open | :00:00. | :00:18. | |
for business by slashing the corporation tax to the lowest | :00:19. | :00:21. | |
The battle of the financial centres - | :00:22. | :00:27. | |
how will Brexit effect the planned merger between | :00:28. | :00:29. | |
the London Stock Exchange and Frankfurt's Deutsche Boerse, | :00:30. | :00:31. | |
You can't see me at the moment, but you can hear me. These robotic | :00:32. | :00:55. | |
cameras, you want to kill them at times. You will see me shortly. Or I | :00:56. | :01:00. | |
could walk down and sit on the chair. No, they are coming back! | :01:01. | :01:07. | |
What a great start. What is going on. | :01:08. | :01:10. | |
How do you attract businesses to a Britain outside the EU? | :01:11. | :01:12. | |
That question must have kept the UK's Finance Minister, | :01:13. | :01:19. | |
Chancellor of the Exchequer George Osborn, awake at night. | :01:20. | :01:21. | |
In an interview with the Financial Times, | :01:22. | :01:26. | |
Mr Osborne says he will cut corporation tax to 15%. | :01:27. | :01:30. | |
At present, the tax businesses pay on their profits | :01:31. | :01:32. | |
But in March, Mr Osborne said the corporation tax | :01:33. | :01:39. | |
He gave no hint as to when the drop to 15% | :01:40. | :01:47. | |
would take place, so your guess is as good as mine. | :01:48. | :01:52. | |
One thing is certain, though, - it would bring the UK close | :01:53. | :01:55. | |
to Ireland's very competetive and somewhat controversial | :01:56. | :01:57. | |
All this is very different from what Mr Osborne was suggesting | :01:58. | :02:11. | |
There will be a hole in public finances. | :02:12. | :02:18. | |
You have Chancellors from two different political parties saying | :02:19. | :02:21. | |
taxes will have to go up, spending will have to be cut. | :02:22. | :02:24. | |
That is the reality of quitting the EU. | :02:25. | :02:33. | |
Let's stay with the theme of Brexit. We are not going to escape it. | :02:34. | :02:39. | |
The planned merger between the London Stock Exchange | :02:40. | :02:41. | |
and Germany's Deutsche Boerse is now in doubt after the UK's vote | :02:42. | :02:44. | |
The deal was meant to bring together Europe's leading financial | :02:45. | :02:48. | |
hub, London, with Frankfurt, home of the European Central Bank, | :02:49. | :02:50. | |
creating a giant able to compete with US and Asian rivals. | :02:51. | :02:53. | |
But Brexit has cast doubt on where the EU's financial centre | :02:54. | :02:56. | |
Some predict Frankfurt will become the continent's finance hub. | :02:57. | :03:07. | |
Jonathan Beastall, Senior Advisor at Pinsent Masons, joins us. | :03:08. | :03:14. | |
We had a sneak preview of you earlier, thank you for coming to the | :03:15. | :03:20. | |
studio at this time of the morning. Before we talk about the impact of | :03:21. | :03:26. | |
Brexit, can I ask you this? Why the talk of this deal in the first | :03:27. | :03:31. | |
place? It is common knowledge that the global nature of business is | :03:32. | :03:36. | |
ever more competitive, and I think it has been thought for many years | :03:37. | :03:40. | |
that a combination of European stock exchanges would be much more | :03:41. | :03:45. | |
competitive and able to offer new products in a rapidly changing | :03:46. | :03:50. | |
global market. Very good point. I am just wondering now, with the Germans | :03:51. | :03:53. | |
looking over towards us here and say be passed to the exact the past | :03:54. | :04:01. | |
week, the pound has dropped, we have seen the markets tumble and banking | :04:02. | :04:07. | |
stocks taking a hammering, and they are looking and going, I am not sure | :04:08. | :04:11. | |
if this is what we originally agreed to sign up to all who wanted to sign | :04:12. | :04:15. | |
up to. I figure will be uncomfortable on the side. But this | :04:16. | :04:20. | |
merger has been a long time in the planning. It was not conditional | :04:21. | :04:25. | |
upon a positive vote in the EU referendum. It is not set to close | :04:26. | :04:27. | |
and to the first quarter of next year. Everybody knew about the | :04:28. | :04:34. | |
referendum. They never said is the deal would go ahead if there was a | :04:35. | :04:38. | |
yes or no? There are no conditions with this major in relation to that | :04:39. | :04:42. | |
thread. Some European cities, satisfying effect, in London or the | :04:43. | :04:50. | |
UK goes out, its title as the financial hub might be lost -- such | :04:51. | :04:56. | |
as Frankfurt. Do we have European cities jostling with each other to | :04:57. | :04:59. | |
see who will take that title? There has already been, Tish and between | :05:00. | :05:04. | |
Frederick, London and Paris as to which is the leader -- competition | :05:05. | :05:12. | |
between Frankfurt. But that pressure has certainly increased as a result | :05:13. | :05:15. | |
of this vote, not least because there is quite a lot of discomfort | :05:16. | :05:19. | |
about the idea of Euro trade deal being settled in London yet not | :05:20. | :05:23. | |
being part of the EU. The reason we are talking about it today is | :05:24. | :05:28. | |
because the LS see shareholders are getting to vote whether they want to | :05:29. | :05:36. | |
put this plan forward -- LSC. This scheme of arrangement is a chord | :05:37. | :05:42. | |
orientated process, any court said first you need a shareholder vote to | :05:43. | :05:47. | |
approve it, and then they come to us and assess whether the merger should | :05:48. | :05:53. | |
go ahead. This is a stage vital to be processed but not the end of the | :05:54. | :05:56. | |
process. We have to leave it there. If you were a betting man, will go | :05:57. | :06:02. | |
ahead? Overall, there are a lot of hurdles to get over, put it that | :06:03. | :06:11. | |
way. Great answer. We appreciated. -- appreciate it. | :06:12. | :06:13. | |
Australia could be facing the prospect of a sovereign credit | :06:14. | :06:16. | |
rating downgrade in the wake of the inconclusive federal election | :06:17. | :06:19. | |
Rico Hizon in our Singapore bureau has been following the situation. | :06:20. | :06:32. | |
There is a similarity in what we are seeing around the world, in the UK, | :06:33. | :06:39. | |
in the United States, voters are a little miffed. Uncertainty. | :06:40. | :06:44. | |
Uncertainty. But you know what? Let me tell you this. I should be | :06:45. | :06:54. | |
talking about a study and the economy, you are the Australian | :06:55. | :07:00. | |
expert! -- are studying politics. We have a election cliffhanger. There | :07:01. | :07:06. | |
is so much uncertainty right now in the Australian political economic | :07:07. | :07:10. | |
and here. You have to major political parties failing to secure | :07:11. | :07:12. | |
a majority to form the next government. By Minister Malcolm | :07:13. | :07:17. | |
Turnbull has promised to stabilise the government but it is still not | :07:18. | :07:20. | |
clear if he will have a majority or be able to form a coalition. Most | :07:21. | :07:24. | |
ballots have been counted, but it will be Tuesday before we get the | :07:25. | :07:27. | |
final result in this knife edge poll. If you have a hung parliament | :07:28. | :07:33. | |
or a minority government, there is an inability to pass, rancid | :07:34. | :07:37. | |
economic and budget reform agendas to the Senate, and for Australians | :07:38. | :07:43. | |
like yourself and Australian business, you cannot afford a | :07:44. | :07:46. | |
gridlock. The priority is approving the Australian standard of living | :07:47. | :07:51. | |
for a strong and growing economy. Although the economy has been | :07:52. | :07:54. | |
growing for the past 25 consecutive years, let's just hope that the | :07:55. | :07:59. | |
streak will not be broken with all of this uncertainty. Hopefully we | :08:00. | :08:03. | |
will soon have a few Prime Minister in three years. -- we might soon | :08:04. | :08:08. | |
have. It is quite embarrassing, really. We will talk to you soon. It | :08:09. | :08:16. | |
would be better if the Australian dollar had dropped last week! | :08:17. | :08:19. | |
The potential effects of Brexit are far-reaching. | :08:20. | :08:22. | |
D'Addario is one of the world's largest manufacturers of guitar | :08:23. | :08:25. | |
Their headquarters are 50 miles outside of New York City. | :08:26. | :08:32. | |
But their CEO says that Britain's decision to leave the EU could force | :08:33. | :08:36. | |
The D'Addario family has been making these strings long before George | :08:37. | :08:53. | |
Harrison started using them. But the uncertainty on the other side of the | :08:54. | :08:56. | |
Atlantic is not exactly music to their ears. Give me a sense of how | :08:57. | :09:01. | |
much of your business depends on your. It is close to 35%, export is | :09:02. | :09:08. | |
very important to us worldwide. Europe is the biggest market right | :09:09. | :09:14. | |
now. So what can send you the most about Brexit? There is a lot of | :09:15. | :09:18. | |
uncertainty because nobody expected this thread to go that way. | :09:19. | :09:22. | |
Uncertainty always makes people hesitant to restock their infantry | :09:23. | :09:27. | |
is and so on. They started jamming things back -- inventories. That is | :09:28. | :09:32. | |
always a concern for us. We have witnessed the dollar getting very | :09:33. | :09:38. | |
strong, so that really puts a damper on exports. Have you already started | :09:39. | :09:43. | |
making contingency plans Chris Mack not really. Not to the extent we | :09:44. | :09:51. | |
probably should have. -- contingency plans? We did not think the vote | :09:52. | :09:56. | |
would go this rate. Business is so, located today in the have to focus | :09:57. | :10:00. | |
on so many different things to manage all of the channels out there | :10:01. | :10:03. | |
in the fact the world is getting so much smaller. Sometimes you just | :10:04. | :10:07. | |
take your eye of things, we probably were not thinking about it enough. | :10:08. | :10:11. | |
The dizziness in Europe is making it difficult even for a company in New | :10:12. | :10:15. | |
York that makes its money from Harmony -- descendants. | :10:16. | :10:21. | |
The markets are slightly up. The Australian dollar under pressure | :10:22. | :10:33. | |
because of the results from the federal election. I will be back to | :10:34. | :10:40. | |
look at the newspapers shortly. | :10:41. | :10:45. |