20/04/2017 World Business Report


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20/04/2017

The latest business news with informed analysis from the world's financial centres.


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Will be looking at the international newspapers later.

:00:00.:00:00.

Now for the latest financial news with Sally Bundock

:00:00.:00:00.

Red lines: The head of the European Parliament meets

:00:00.:00:19.

Theresa May with a list of 'non-negotiables'.

:00:20.:00:23.

But will the UK's June election mean a softer approach to Brexit?

:00:24.:00:29.

Plus: Rural revolution - why anti-Europe candidates

:00:30.:00:32.

are finding fertile ground in the French countryside.

:00:33.:00:38.

Also coming up, Japan sees its biggest jump in exports

:00:39.:00:49.

We will have the numbers soon. It has been moving the markets in Asia.

:00:50.:00:56.

But first: We start here in London

:00:57.:00:59.

where in a few hours time the head of the European Parliament is due

:01:00.:01:03.

in Downing Street to meet the British Prime

:01:04.:01:06.

Minister Theresa May. Antonio Tajani's visit comes

:01:07.:01:07.

as the country prepares for an election which will be

:01:08.:01:10.

dominated by Britain's exit The European Parliament has a vote

:01:11.:01:12.

on the final Brexit deal, and has set out a series of "red

:01:13.:01:20.

lines" it won't compromise on, something Tajani will no doubt

:01:21.:01:23.

discuss with May today. It wants the final agreement

:01:24.:01:27.

to make sure the UK complies with a range of EU policies

:01:28.:01:33.

on issues such as the environment, It also stresses the

:01:34.:01:37.

United Kingdom must honour all its legal and financial

:01:38.:01:44.

obligations to the EU, which includes its agreement to pay

:01:45.:01:49.

into the budget until at least 2020. Now, that could mean

:01:50.:02:00.

a hefty exit - or divorce - And one that's bitterly

:02:01.:02:07.

disputed by some in the UK and it insists two major EU

:02:08.:02:15.

regulators currently based in London - the European Banking

:02:16.:02:18.

Authority and European Medicines Agency - will also have

:02:19.:02:20.

to move to the continent. Some in financial markets are now

:02:21.:02:23.

betting that getting the election out of the way in June will allow

:02:24.:02:26.

the UK to be much more flexible in agreeing to these demands,

:02:27.:02:30.

and avoid a so-called 'hard Brexit'. Markets have recognised that

:02:31.:02:33.

Theresa May defending an effective majority of only 17 in Parliament

:02:34.:02:36.

was likely to be quite problematic for her in the next

:02:37.:02:39.

couple of years while Brexit And so, on the basis that currently

:02:40.:02:42.

the Conservative party is enjoying a lead of 18%-20%

:02:43.:02:54.

in the polls, we might logically expect a much bigger and more

:02:55.:02:57.

defensible majority government post the June 8th election and make

:02:58.:03:00.

the negotiations that she has to conduct over Brexit

:03:01.:03:03.

that much more viable. That was the view there. But we get

:03:04.:03:10.

another from Anand Menon. Professor Anand Menon is Professor

:03:11.:03:16.

of European Politics and Foreign Affairs

:03:17.:03:18.

at Kings College London. Thank you for coming in. Mike Ingram

:03:19.:03:27.

Mac, and many have argued that it Theresa May does get their strong

:03:28.:03:33.

majority there that she is hoping for, she will get a better position

:03:34.:03:37.

to negotiation. What are your thoughts on a meeting today? In one

:03:38.:03:42.

sense, she is in a stronger position because it makes life easier

:03:43.:03:47.

Parliament. She has to make a lot of things happen. I don't think it will

:03:48.:03:53.

affect the European Union was that position. I don't think they care

:03:54.:03:57.

one way or another what her size of majorities in Parliament. I think

:03:58.:04:00.

they will put together what they think is a fair negotiating

:04:01.:04:03.

position. That won't change to matter what. How important is

:04:04.:04:08.

today's meeting? The European Parliament is not involved in the

:04:09.:04:12.

negotiations, but it does have designed. It is a curious one. We

:04:13.:04:15.

are not negotiating with the European Parliament. But we need to

:04:16.:04:19.

keep them onside. Because the worst of all world is that we get to the

:04:20.:04:23.

end of the two years, and they voted down. They can do that. Keeping them

:04:24.:04:28.

on side is important. Some of these things we have talked through, they

:04:29.:04:31.

described as red lines that cannot be crossed. The divorce bill of 60

:04:32.:04:35.

billion euros already, David Davis is saying that it is nothing like as

:04:36.:04:43.

nearly as high. This has been bandied about as a possibility. The

:04:44.:04:47.

first stage of our negotiations with the commission is going to be to

:04:48.:04:50.

figure out what we should be including in our bill and what we

:04:51.:04:54.

should not. I don't think that figure is set in stone. But the EU

:04:55.:04:58.

is making it clear that whatever the figure they arrive at, we had to

:04:59.:05:02.

pay. We can get around it. The issue of the timeframe, it has been said

:05:03.:05:06.

from the beginning that it is tight. We had to get negotiations in so

:05:07.:05:10.

that national governments can pass it through their own parliaments,

:05:11.:05:14.

and that it is signed. Now the timeframe is even tighter because

:05:15.:05:17.

the Prime Minister has to fight an election, first. What are your

:05:18.:05:20.

thoughts on that? Brussels seems to be fairly miffed about that. I think

:05:21.:05:24.

we can do the divorce within the time we got. That will be easy. --

:05:25.:05:29.

we have got. But I don't know any trade experts that think we can

:05:30.:05:33.

negotiate a trade deal to the future even with the two years, which we

:05:34.:05:38.

don't have. What we're looking at is more likely transition. A the

:05:39.:05:44.

translation is then lengthened between the negotiation and our next

:05:45.:05:47.

general election. So Theresa May might be able to say have a short

:05:48.:05:51.

transitional implementation phase that allows us falling off a cliff

:05:52.:05:56.

edge for the moment. I will probably talk to you again in the next little

:05:57.:05:58.

while. We appreciated. We are also in rural Provence

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in southern France - as the nation gears up for the first

:06:04.:06:07.

round of its Presidential It's in the countryside that most

:06:08.:06:10.

support has been building for the two populist anti-EU

:06:11.:06:14.

and anti-Euro candidates: The National Front's Marine Le Pen

:06:15.:06:18.

and the hard-left firebrand Jean-Luc Theo Leggett has been

:06:19.:06:21.

finding out why. Glittering under the Hajj son of

:06:22.:06:34.

Provence. These rice fields are floated before the crop is planted.

:06:35.:06:38.

Prices being grown in the region for centuries, but now the industry

:06:39.:06:41.

faces a difficult future. Competition from abroad and a big

:06:42.:06:44.

reduction in subsidies have taken a heavy toll on production. Growers

:06:45.:06:52.

say they that no help the government in Paris. They think that has to

:06:53.:06:57.

change. TRANSLATION: Politician should be

:06:58.:07:02.

focusing on rural issues in France. There are 15 million people living

:07:03.:07:06.

in rural areas. About one quarter of the population. Politics must become

:07:07.:07:11.

rural again. The rice business has its own particular concerns, course,

:07:12.:07:15.

but you will hear much the same sort of thing if you talk to farmers up

:07:16.:07:18.

and down this country. They are worried that their problem simply

:07:19.:07:22.

are not being taken seriously enough by politicians in towns and cities.

:07:23.:07:26.

In the small village here, farmers have gathered for the weekly market.

:07:27.:07:30.

They have little time for mainstream politics.

:07:31.:07:34.

TRANSLATION: Rural issues are taboo. It is only large towns and their

:07:35.:07:37.

inhabitants that politicians care for. Country people are being

:07:38.:07:41.

forgotten. TRANSLATION: I think it is the

:07:42.:07:45.

candidates on the far right and far left that people here would vote

:07:46.:07:48.

for. The extremes. TRANSLATION: I will vote Marine Le

:07:49.:07:53.

Pen. Because she is a woman, and we have never had a female president in

:07:54.:07:56.

France. She could bring something new that male leaders have not in

:07:57.:08:02.

the past. Opinion polls suggest that dissolution among rural people is

:08:03.:08:06.

providing a boost for the populist candidates. Jean-Luc Melenchon and

:08:07.:08:13.

the Front National's Marine Le Pen. They have a sense of abandonment

:08:14.:08:18.

from the major political parties. You know, they used to be a large

:08:19.:08:21.

portion of the population. Now they are very small portion, and

:08:22.:08:25.

therefore they are not in the centre of the political scene any more and

:08:26.:08:31.

so more and more they are turning to the Front National, which again

:08:32.:08:35.

looks like the only alternative for them. Although more than three

:08:36.:08:39.

quarters of friends's population now lives in cities, the countryside is

:08:40.:08:44.

still home to millions of voters. -- France. Their voices might

:08:45.:08:47.

ultimately become very important indeed. Theo Leggett, BBC News,

:08:48.:08:51.

Provence. Now, let's go to Asia now

:08:52.:08:55.

where markets are getting a boost from some strong trade

:08:56.:08:59.

figures from Japan. Rico Hizon has been

:09:00.:09:01.

looking at them for us. Nice to see you. This is great news

:09:02.:09:08.

out of Japan in the munch of March. It has sold a lot of goods overseas?

:09:09.:09:14.

But the big question now is can be sustained? For now, the Japanese

:09:15.:09:19.

stock-market and investors are cheering will stop this was better

:09:20.:09:24.

than expected. These export levels have not been seen in more than two

:09:25.:09:28.

years. And a strong result, which came in better than expected, may be

:09:29.:09:32.

a sign that the economy is indeed picking up in the world's third

:09:33.:09:37.

largest economy. Export gains were led by strong than full auto-parts

:09:38.:09:41.

and optical instruments, such as mobile phones and tools to make

:09:42.:09:46.

semiconductors. And by regions, exports to China rose by more than

:09:47.:09:51.

16%. Shippers to America expanded by three and a half %. So the

:09:52.:09:58.

fundamentals are improving here, you now have the International Monetary

:09:59.:10:03.

Fund raising its forecast, projecting a 1.2% annual expansion

:10:04.:10:08.

this year from a previous forecast of just .8%. And also a key business

:10:09.:10:13.

confidence survey also pointing to rising optimism amongst big

:10:14.:10:19.

Manufacturer 's. Soap Shinzo Abe might be pulling the right strings,

:10:20.:10:22.

pushing the right buttons, and he has been trying for years to

:10:23.:10:28.

rejuvenate growth and end a period of the non- inflation through a

:10:29.:10:34.

policy of easy money, stimulus, and reform. -- predator. But the

:10:35.:10:38.

question is can be sustained in April and the coming months? We will

:10:39.:10:43.

rely on you to keep us informed. We will see you soon. -- So, Shinzo

:10:44.:10:48.

Abe. That is all promised on World Business Report for the time being.

:10:49.:10:52.

We will see you in a minute for a review of the new stories. See you

:10:53.:11:04.

in a moment. Sally will be back in a

:11:05.:11:06.