21/04/2017 World Business Report

France prepares for the closest election in living memory,

posing major risks for the Euro and the EU itself.

Plus, riding the economic cycle - the IMF says global growth

is finally moving up a gear, and the boss

We have a special report from Milwaukee in America's Midwest.

Give me eight minutes and I will try, I will try, nine, nine minutes

they are telling me by the time I finished this, it will be eight!

Also coming up - electric cars are dominating the Shanghai Auto

We are going to plug in for the latest from

we start in France, where the shootings in Paris have

interrupted final campaigning in what was already being called

the most unpredictable presidential election in living memory.

Centrist favourite Emmanuel Macron and far-right Marine Le Pen look

likely to go through after Sunday's vote to a run-off on May 7.

But they are closely followed by conservative

Francois Fillon and far-left candidate Jean-Luc Melenchon,

Socialist Benoit Hamon, though, is being given little chance

Security is, of course, right back at the top of the agenda.

But there are other huge issues for financial markets -

number one is the fate of the Euro currency.

Le Pen wants to abandon it and bring back the Franc.

Melenchon has also threatened to pull out, but he's softened that

stance recently, now saying it should be reformed,

and the independence of the European Central Bank taken

away - both a big worry for financial markets.

Macron and Fillon are supporters of the Euro and want to see

Le Pen wants a referendum on 'Frexit'.

So does Melenchon, unless Europe agrees to his reforms.

Macron and Fillon want to stay in, Macron wants a stronger EU,

but Fillon is more eurosceptic and wants more control

The other major issue for the business world -

labour reform, and France's famous 35-hour working week.

Melenchon wants to cut the working week even further,

At the other end of the spectrum, Fillon wants to scrap the 35-hour

limit altogether and make it easier to hire and fire.

Tomasz Michalski is Associate Professor of Economics at HEC

He joined us, great to have you on the programme. Let me start with

this, it is hard to believe in any poll nowadays, they have it awfully

wrong in the last few occasions, but if Marine Le Pen and Jean-Luc

Melenchon managed to get through to the run-off on May seven, that

scenario, and correct me if I'm wrong, could possibly be a killer

scenario for the euro and for the markets. That's to some extent true,

however there is also another concern, what will be the

parliamentary majority, which is going to happen at the election is

going to follow after the presidential one. And it may arise

that you are going to have a president like Marine Le Pen or

Jean-Luc Melenchon without the parliamentary majority. And the

Parliament does have a say in a lot of the issues. Perhaps the

Parliament, for example if Marine Le Pen wins would agree to a referendum

and most French are actually in favour of staying in the eurozone so

it's not, you know, may not be a total disaster, it will make things

extremely difficult here. It does indeed and that makes it difficult I

guess to get any reforms through because let's be frank, France needs

a lot of reforms, I keep getting told! The main economic challenge

for any president, debt, deficit, how much the French government

spends more than it actually earns, and of course the Labour issue, the

market. Exactly. Basically, the French didn't feel any kind of

burden for example of the debt as of now because the rates were

historically low and that is approaching and the GDP is 100% but

if the rates go up as economic activity picks up and the month as

it stands is back to the normal, you are going to see a big item in the

budget appearing. Next, so basically there has to be something done about

state expenditure, the state, the French state, hasn't turned a

positive budget for 40 years and counting. And then there are also

other issues like you mentioned, reforms, the market is high,

unemployment, 10%, relative to our European peers, and this requires

very strong reforms of them market, not only of the Labour market and

improving qualifications. Perhaps difficult reforms such as improving

and introducing apprenticeships in the spirit of the German model.

Indeed. We will leave it there, we appreciate you coming in, lots of

nailbiting between now and Sunday. Thank you for joining us. Thank you

very much. We are also in the US

Midwestern city of Milwaukee - The boss of the company has been

telling our economics editor Kamal Ahmed why he's optimistic

the global economy is, like his famous bikes,

accelerating nicely. The International Monetary Fund has

also moved its economic forecasts up Bitmapped at liberty to, the man who

runs and rights Harley-Davidson. -- meet Matt. A all-American company

that exports around the world. If things are going well for businesses

like this, but the signal that the global economy is set. I asked him

if the economy is indeed looking up. A lot of this is just psychology,

when people feel more confident, then they are willing to make, if

you will, financial risks of investing in something and putting

their home, buying a motorcycle, but when they feel really uncertain,

they pull back. They wait. And so the election and so forth has helped

people feel more optimism. Running more smoothly at Harley-Davidson and

for America, it is up and it is not alone, European growth is up, UK

group is up. The official IMF forecast to make a better reading,

although there have been wrong before. And for the head of the

world 's leading financial organisation, there are reasons to

be cheerful. We are forecasting growth in 2017 at 3.5%. In 2018, at

3.6%. And that's a significant update from 2016. Which is all good

news. But we need to make sure that this momentum is sustained. When you

come to a company like Harley-Davidson, you are immediately

struck not by the size of the factory but by the sense of

optimism. Yes, some of that is down to the presidential election but a

lot of it is down to the return of global economic growth. A return so

marked, arguing that ten years after the financial crisis of the global

economy has finally turned the corner. William Harley and Arthur

Davidson found their world-famous motorbike company in a shed on this

site in 1903. It's the kind of business Mr Trump likes. And like so

many American firms, it is waiting to see if this better global

economic news is here to stay. That wasn't bad, was it? One thing was

missing, Kamal on a bike! Let's talk to him about that later.

Let's go to Shanghai, China now where the annual auto show

China has been the world's top car market for almost a decade and well

over 1,000 new models are on display.

Our correspondent Robin Brant is there.

Robin, the two big themes - electric and self-driving cars?

I have been told that Robert is a redhead. -- -- Rob is a revhead..

This is the biggest car show in the biggest market in the world and it

is just about cars you can drive away today. It is about tomorrow's

cars as well and that means autonomous vehicles and electric

vehicles and China is trying to become a world leader in electric

and that means the technology, the batteries behind them, but also

persuading drivers to buy them and then drive them and I've been

talking to some chief executives of the biggest car their strategy on

electric and Mathias Miller who heads up VW, the biggest carmaker in

the world, help me even though they have ruled out the new concept car

for electric they want to see on the streets in a couple of years time,

they hope to sell 1.5 million of them by 2025, he told me he still

thinks VW will be making combustion engines for another 20 years.

Another thing people are talking about is autonomous vehicles. And a

huge company here in China, their version of Google, it is thrown

money and resources into autonomous vehicles and announced yesterday

interestingly that it wants to share its technology with anyone who wants

it. But there is caution, they think they can have a car on the streets,

and a common as vehicle, in three years but one senior adviser at VW

said to me they are not quite optimistic about safety, they have

concerns about having autonomous vehicles on the streets in any other

conditions than clear daylight. Any favourites you've seen? Anything

you will stump up while you're there? He may have trouble hearing

me. On my salary, maybe I can stretch to a Chinese car but maybe

not this one behind me! Thank you, talk to you soon. Making headlines -

President Trump has launched a federal investigation

into whether dependence on cheap foreign steel is a threat to the US

defence industry and national security.

He signed the order at a White House ceremony surrounded

The rarely used Trade Expansion Act of 1962 raises the possibility

of tariffs on China and other steel exporters.

A fall in sales of Barbie dolls has added to a slump at the world's

It reported sales down more than 15% in the first three months

of the year - the biggest drop in seven years and much

Mattel is still struggling with piles of leftover stock

after a disappointing holiday season.

I thought Barbie dolls were popular. I guess when they brought out the

new models, different colours, except wrote...

Don't forget, you can get in touch with me and some

I will be back with Christer have a look at the papers from around the

world. -- Chris too. Don't adjust your set, everything is

normal at the BBC. The average cyber criminal

investigated by the National Crime