:00:16. > :00:18.And then there were two - the final candidates for the French
:00:19. > :00:21.presidency have been chosen but what economic challenges
:00:22. > :00:29.And 10,000 times stronger than the real thing -
:00:30. > :00:33.we take a look at an artificial sun in Germany and what it means
:00:34. > :00:51.Also in the programme, the euro has spiked in value
:00:52. > :00:53.following the outcome of Sundays vote in France.
:00:54. > :00:56.Rico will have the latest in a moment.
:00:57. > :01:04.as you've been hearing, the French have voted on who will go
:01:05. > :01:07.though to the final run-off for the Presidency on May 7th.
:01:08. > :01:09.As widely expected, centrist Emmanuel Macron and far-right
:01:10. > :01:17.It's been the most unpredictable presidential election in France's
:01:18. > :01:19.history but there are some constants -
:01:20. > :01:21.namely, the economic problems and challenges that remain whoever
:01:22. > :01:29.walks into the Elysee Palace.
:01:30. > :01:34.A key issue is unemployment, currently at 10% in France.
:01:35. > :01:38.Almost three million people are out of work.
:01:39. > :01:40.Not as bad as some eurozone neighbours, but above average
:01:41. > :01:43.for the region and far worse than, for example, Germany,
:01:44. > :01:56.where it is below 4% and the UK it's 4.7%.
:01:57. > :01:59.Deep-rooted structural problems make its labour market inflexible.
:02:00. > :02:02.One example, companies find it it harder and less attractive to hire
:02:03. > :02:09.Firing them is tricky, too, due to complex dismissal procedures.
:02:10. > :02:12.Then there's the infamous working week.
:02:13. > :02:14.While long-hours are not banned, anything over 35-hours
:02:15. > :02:19.French government debt is close to 100% of GDP.
:02:20. > :02:22.The International Monetary Fund has warned if economic growth weakens
:02:23. > :02:24.significantly and the state get less tax revenues,
:02:25. > :02:34.then its debt burden could rise further.
:02:35. > :02:38.And the vast public sector in France is a huge strain on state finances -
:02:39. > :02:41.the nation has one of the highest public spending ratios among
:02:42. > :02:50.developed economies at more than half of total national output.
:02:51. > :02:53.Joining me now from Paris is Laurent Clavel, head
:02:54. > :02:59.of macroeconomic research at AXA Investment Managers.
:03:00. > :03:07.Good morning, thank you for being with us. Good morning. First of all,
:03:08. > :03:13.give us your reaction to this outcome on Sunday. The Euro spiking
:03:14. > :03:18.to a 5- month high. Why? Why are they ploughing into the euro, do you
:03:19. > :03:25.think? Well, as you said earlier, it was very difficult to predict this
:03:26. > :03:29.election and we have developed our own model to correct and aggregate
:03:30. > :03:34.poles and we had a roughly 20 cents chance to have a market unfriendly
:03:35. > :03:39.outcome which would have dampened the euro and now, the result from
:03:40. > :03:45.yesterday is in the direction that this probability is revised down
:03:46. > :03:49.quite significantly and therefore it is quite natural for us that we
:03:50. > :03:54.would see the euro appreciate a little, only a little, because the
:03:55. > :03:59.risk scenario was less likely than our baseline which was what we see
:04:00. > :04:04.today. And what do you think will happen next in terms of who will
:04:05. > :04:08.come out winner in a couple of weeks time? Those that lost out have
:04:09. > :04:16.rallied behind Emmanuel Macron, will he get the job? Yeah, that's
:04:17. > :04:21.definitely the baseline scenario. A 20% probability of a risk to have a
:04:22. > :04:27.market on family out, and the French election, we have come down somehow,
:04:28. > :04:32.somewhat, the risk is not completely gone, obviously, and turnout will be
:04:33. > :04:37.key on a turnout was very strong yesterday, almost 80% which is in
:04:38. > :04:43.line with the average we have seen in the past 40 years in presidential
:04:44. > :04:48.elections in the run-off and now that there was a large turnout, it's
:04:49. > :04:52.not obvious that you will get the same in the run-off at a low turnout
:04:53. > :04:59.would favour Marine Le Pen. The polls we have had for the run-off in
:05:00. > :05:06.the case of Macron- the pen, we are giving a clear victory to Macron,
:05:07. > :05:11.are close to 30 point lead. If he doesn't get the job, what will it
:05:12. > :05:18.mean for the French economy? I would say for the markets, the reform and
:05:19. > :05:22.who is the final President won't matter as much as the fact that we
:05:23. > :05:27.have two candidates that a credible and have a clearly market unfriendly
:05:28. > :05:33.agenda were questioning the unity of the eurozone. So now that it is
:05:34. > :05:37.almost out, on May seven and our baseline will be completely out, you
:05:38. > :05:43.get a limited relief rally. For the French economy it is a different
:05:44. > :05:47.question. Here, the real trigger will be the general elections. This
:05:48. > :05:55.is completely new candidate with a new party behind him. We are talking
:05:56. > :06:00.about En Marche! And it is fairly unlikely that you would get an
:06:01. > :06:04.outright majority in Parliament. So we are heading for something quite
:06:05. > :06:10.original in the history of the republic of France which is we may
:06:11. > :06:15.get to a Coalition. We have to leave it there. Thank you for your
:06:16. > :06:16.analysis this morning. Let's talk more about the market reaction.
:06:17. > :06:19.The value of the euro jumped to a five-month high,
:06:20. > :06:22.after the first round of voting in the French presidential election
:06:23. > :06:25.Let's see how it's fared in Asian trading -
:06:26. > :06:28.Rico Hizon is in our Asia Business Hub in Singapore.
:06:29. > :06:33.Lovely to see you Rico. Tell us about what is happening in the
:06:34. > :06:37.markets. If you take a look at the euro trading in Asia there has been
:06:38. > :06:40.a lot of movement, Sally, over the past few hours. Investors are
:06:41. > :06:44.breathing a sigh of relief, the market favourite candidate won
:06:45. > :06:49.through to the first round of the French election. The risk of a
:06:50. > :06:54.Brexit- like shock and sparking a mass unwinding of safe haven trades.
:06:55. > :07:01.The euro earlier in Asian trade, trading as high as 1.0, up by about
:07:02. > :07:06.2%, but a lot of volatility in midday trading with the euro now
:07:07. > :07:11.dipping to about 1.08 44 to the US dollar against the Japanese
:07:12. > :07:17.currency, the euro hit 120.91 yen in early Asian trade and now on - 19.
:07:18. > :07:22.Over all traders expect investors to be jittery yet again, closer to the
:07:23. > :07:26.second round of voting on May seven. Some say that if Le Pen wins the
:07:27. > :07:30.presidential election, the euro could take a huge fall and
:07:31. > :07:35.potentially hit parity with the US dollar. Other currency analyst say
:07:36. > :07:38.Le Pen is one big hurdle for the euro, there are more election is
:07:39. > :07:43.coming this year in Germany and Italy and certainly it could lead to
:07:44. > :07:45.more euro. Thank you, Rico. We will see you more very soon.
:07:46. > :07:48.Germany has one of the highest solar power capacities in the world,
:07:49. > :07:52.That's why scientists at the German Aerospace Centre
:07:53. > :07:54.in Julich have built a unique facility -
:07:55. > :07:58.with an artificial sun with a glare that's 10,000 times the intensity
:07:59. > :08:03.All to create technologies that will make solar an ever more
:08:04. > :08:21.A cloudy day in rural Germany, OK for the coal mines in wind -- and
:08:22. > :08:24.wind turbines but less so for the solar tower which is why scientists
:08:25. > :08:28.at the German aerospace centre have taken the research indoors. This
:08:29. > :08:33.facility gives us consistent artificial light which is very
:08:34. > :08:43.useful, especially here in west Germany, the weather is not perfect
:08:44. > :08:48.and we have very rare sunlight and so we have a facility which gives
:08:49. > :08:54.unlimited light. This is the world's largest artificial sun are composed
:08:55. > :08:59.of 149 projection lights. Together, they commit a bean which is 1000
:09:00. > :09:03.times the strength of a regular household bulb and 10,000 times the
:09:04. > :09:08.strength of the sun's race here on earth. And scientists here can use
:09:09. > :09:15.it to test the solar power instruments of the future. This is
:09:16. > :09:20.one of our first experiments, and a typical one. It is a hydrogen react
:09:21. > :09:26.and this reactor, we want to develop a process on splitting water from
:09:27. > :09:35.solar energy to store this energy and to make it available in fuels.
:09:36. > :09:39.When we focus on it, we think we can reach temperatures of around 3000dC
:09:40. > :09:45.so this is more than a combustion processes can generate. The hope is
:09:46. > :09:50.that this facility can improve the efficiency of solar energy reactors.
:09:51. > :09:55.But with the oil price is still relatively low, commercial interest
:09:56. > :10:00.in its research may take some time. Joe Miller, BBC News, Munich.