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More trouble on the radar for BA as cabin crew prepare to strike, | :00:17. | :00:19. | |
just weeks after an IT crash that stranded thousands. | :00:20. | :00:22. | |
Are cost cuts taking their toll on the airline's image? | :00:23. | :00:27. | |
Plus, from the sick man of Asia to one of the region's | :00:28. | :00:30. | |
We report from the Philippines, 20 years on from | :00:31. | :00:33. | |
We start with more problems for British Airways. | :00:34. | :00:47. | |
Thousands of passengers are learning that their flights have been | :00:48. | :00:49. | |
cancelled because of an unprecedented 16-day strike | :00:50. | :00:53. | |
by some cabin crew, which begins tomorrow, | :00:54. | :00:55. | |
On Thursday, BA said most flights will operate as normal but it has | :00:56. | :01:00. | |
cancelled a number of long-haul departures to and from Heathrow. | :01:01. | :01:03. | |
Short-haul and flights from other UK airports are unaffected. | :01:04. | :01:06. | |
The Unite union says cabin crew who have taken industrial action | :01:07. | :01:14. | |
over pay in the past have been blacklisted - | :01:15. | :01:17. | |
losing benefits like staff travel, concessions and bonuses. | :01:18. | :01:24. | |
BA estimates around 8% of its total cabin crew will walk out - | :01:25. | :01:27. | |
To limit the damage, the airline is merging some | :01:28. | :01:32. | |
It is also talking to other carriers such as Qatar Airways, | :01:33. | :01:36. | |
which owns one-fifth of its parent IAG, about using their services. | :01:37. | :01:41. | |
Well, upsetting its customers again is the last thing BA needs | :01:42. | :01:45. | |
after a major IT crash last month stranded 75,000 passengers. | :01:46. | :01:50. | |
The financial cost, some $100 million, but the cost to BA's | :01:51. | :01:53. | |
The BBC's Richard Westcott spoke to BA boss Alex Cruz at the time. | :01:54. | :02:02. | |
He suggested that since Mr Cruz took over just over a year ago, | :02:03. | :02:06. | |
BA has had an image problem because of cost cutting - | :02:07. | :02:08. | |
even down to charging for sandwiches on short-haul flights. | :02:09. | :02:15. | |
There has definitely been a reaction from the buying on-board for example | :02:16. | :02:24. | |
and certainly this event over the last two days have affected the | :02:25. | :02:29. | |
image at we have also committed to over 400 million pounds of | :02:30. | :02:32. | |
investment around the product and beyond and we are going to continue | :02:33. | :02:36. | |
investing in BA, BA is a great airline and has always been a great | :02:37. | :02:39. | |
airline and we are committed to making it an absolutely fantastic | :02:40. | :02:43. | |
airline. Under quite a bit of pressure. Have you considered | :02:44. | :02:48. | |
resigning? I do think it would make much of it is for me to resign at | :02:49. | :02:52. | |
this particular point in time. I am working closely with my team to make | :02:53. | :02:56. | |
sure, again, that we work on the rest of the disrupted passengers to | :02:57. | :03:00. | |
make sure that we address all of their needs. That was Alex Cruz, the | :03:01. | :03:04. | |
boss of BA. John Strickland is an aviation | :03:05. | :03:05. | |
and airlines expert Thank you for coming in. British | :03:06. | :03:14. | |
Airways does seem to be having an image problem. It was seen as one of | :03:15. | :03:19. | |
the traditional carriers, a step above the budget airlines. Now all | :03:20. | :03:23. | |
we seem to hear in the headlines and stories of cost-cutting and the | :03:24. | :03:27. | |
consequences. Putting in a business context, they are very profitable as | :03:28. | :03:31. | |
part of their parent group IAG and if they didn't satisfy customer | :03:32. | :03:35. | |
needs to attract business in a competitive market they wouldn't be | :03:36. | :03:40. | |
that strong. They have had to take on challenges because we as | :03:41. | :03:43. | |
customers are looking more and more for good prices in our travels, also | :03:44. | :03:48. | |
BA has to compete against low-cost carriers and equally have to compete | :03:49. | :03:52. | |
at the top end of the market with premium customer brands like the | :03:53. | :03:58. | |
airways and Emirates. They have to invest in the premium product if it | :03:59. | :04:03. | |
means we get lower prices at the bottom end by competitors, and we go | :04:04. | :04:10. | |
to the competitors if BA doesn't offer them, they have to make sure | :04:11. | :04:14. | |
they do the same thing and they have to look at their cost efficiencies | :04:15. | :04:18. | |
they can do that without losing money. This strike starts tomorrow, | :04:19. | :04:22. | |
16 day strike. What is it about? As we heard, there was a strike or a | :04:23. | :04:30. | |
series of strikes earlier in the year about pay and BA's mixed fleet, | :04:31. | :04:35. | |
they said that a few years ago to deal with issues to make it more | :04:36. | :04:39. | |
efficient in terms of cost levels for cabin crew and productivity and | :04:40. | :04:43. | |
the union in fact agreed with the airline about his art as we heard, | :04:44. | :04:49. | |
BA said to those who went on strike we will take away your privileges, | :04:50. | :04:53. | |
that his travel concessions or bonuses which the management could | :04:54. | :04:59. | |
not justify those who went on strike and the vast majority of crew | :05:00. | :05:03. | |
including those in this particular fleet did not strike said the union | :05:04. | :05:07. | |
is now taking BA to task about the issue, looking to take legal action | :05:08. | :05:12. | |
if they will strike over the next fortnight. How far it is supported | :05:13. | :05:16. | |
is difficult to tell what it isn't about pay. What about Alex Cruz? He | :05:17. | :05:23. | |
was speaking after the OT meltdown a few weeks ago, 75,000 passengers | :05:24. | :05:27. | |
affected. He was saying it didn't feel it will be a benefit for him to | :05:28. | :05:34. | |
leave. --I T. Three weeks later, another headline grabbing story. | :05:35. | :05:38. | |
What is the industry's view? The financial community look at BA as | :05:39. | :05:43. | |
part of the group IAG and financially, if successful in that | :05:44. | :05:49. | |
respect. The book to the management of the company to steer it in a | :05:50. | :05:53. | |
tough and competitive market to make sure that it is continuing to | :05:54. | :05:58. | |
deliver profit. He has the challenge of delivering the bottom line but | :05:59. | :06:01. | |
without the bottomline of course there is no future for the airline. | :06:02. | :06:05. | |
Others are ready to take their lunch or dinner or whatever, local | :06:06. | :06:09. | |
carriers or remember at the other end of the markets are you still | :06:10. | :06:13. | |
have to with that. He is someone who has a good reputation, having | :06:14. | :06:18. | |
managed other low-cost airlines but other local airlines as well such as | :06:19. | :06:22. | |
American airlines. We have to wait and see what the outcome is of a | :06:23. | :06:26. | |
report which they had instigated into the eye teeth out there which I | :06:27. | :06:30. | |
believe they need to show that publicly. -- IT. They need to get | :06:31. | :06:43. | |
into the black ink rather than the red ink. Thank you for your time. | :06:44. | :06:45. | |
As we have been reporting all week, it's been 20 years since | :06:46. | :06:48. | |
the financial crisis that swept through east Asia and wreaked havoc | :06:49. | :06:51. | |
For the last in our series, we are in the Philippines. | :06:52. | :06:55. | |
When the crisis hit in 1997, in economic terms it was widely seen | :06:56. | :06:59. | |
But, as Rico Hizon reports from his home city of Manila, | :07:00. | :07:04. | |
the Philippines is now one of the fastest growing economies | :07:05. | :07:06. | |
Manila. The capital city of one of the most dynamic economies in South | :07:07. | :07:20. | |
East Asia. With the Asian financial crisis devastated the region, the | :07:21. | :07:24. | |
Philippines managed to pull through better than its neighbours, so how | :07:25. | :07:30. | |
did that happen? One of the crucial factors was its economy. Every day, | :07:31. | :07:36. | |
hundreds if not thousands of people queue up here to try to get their | :07:37. | :07:41. | |
permits to work overseas. The money they send back helps to drive | :07:42. | :07:44. | |
consumption and keep the economy buoyant. 20 years ago, remittances | :07:45. | :07:52. | |
made up 6- 8% of GDP. That is nearly doubled in 2005. Today, it still | :07:53. | :07:59. | |
worth 10% of the national income. What other factors helped the | :08:00. | :08:04. | |
Philippines ride out the crisis and recover quicker than everyone else? | :08:05. | :08:09. | |
We were late in the game in the property sector is that we didn't | :08:10. | :08:13. | |
have a property bubble just yet at that time. Compare to Thailand and | :08:14. | :08:19. | |
Indonesia, you know, they had a property bubble which was financed | :08:20. | :08:25. | |
by debt. And at the same time learning... It was a tough time for | :08:26. | :08:30. | |
many. In 1997, this man watched his empire all but collapsed. His | :08:31. | :08:33. | |
building technology company was wiped out and he spent years | :08:34. | :08:38. | |
painstakingly rehabilitating the luxury car dealership he began from | :08:39. | :08:43. | |
scratch. It came as a total surprise. We didn't know where it | :08:44. | :08:49. | |
came from, we had no idea of how it was going to affect us. And then we | :08:50. | :08:53. | |
just realised that it was in a financial holocaust, a nightmare, | :08:54. | :08:59. | |
every day being so fearful of what is new problems will arise. And it | :09:00. | :09:04. | |
was like eating broken glass for breakfast every day. For a living | :09:05. | :09:11. | |
years. What do you think, guys? But the Philippines is looking forward, | :09:12. | :09:17. | |
not back. Anna is a nurse and she is typical of the new generation. In | :09:18. | :09:21. | |
her early 20s, she is the average age of the population. Like so many | :09:22. | :09:26. | |
Filipinos, she sees her future abroad. She is preparing to move to | :09:27. | :09:33. | |
London. Hopefully he and the Philippines, I don't get paid as | :09:34. | :09:39. | |
much as I work for the job. I work around 48 hours per week and get | :09:40. | :09:47. | |
only as much as 356 pesos. Expanding Philippine economy has its | :09:48. | :09:51. | |
challenges. A slowdown in remittances, the need to improve | :09:52. | :09:54. | |
infrastructure, and tackling the poverty gap. Still, and is excited | :09:55. | :10:02. | |
and optimistic about the future and so too is the Philippines. | :10:03. | :10:09. | |
But have a quick look at what the markets have been up to. They have | :10:10. | :10:14. | |
been trading down following what was happening on Wall Street in Europe, | :10:15. | :10:18. | |
Ben McKay and the Hang Seng are down and the story is in the currencies. | :10:19. | :10:22. | |
A weakening of the dollar as it looks like more central banks are | :10:23. | :10:25. | |
going to start tightening monetary policy and the dollar will be losing | :10:26. | :10:30. | |
some of its appeal. Both the euro and the Stirling are up against the | :10:31. | :10:34. | |
dollar. More on that throughout the morning. | :10:35. | :10:36. | |
Don't forget, you can get in touch with me and some of the team | :10:37. | :10:46. | |
Nurseries in England say local councils are failing to provide | :10:47. | :10:49. | |
enough money to fund more free child care for 3- | :10:50. | :10:52. | |
From September, children will be eligible for 30 hours free nursery | :10:53. | :10:56. |