30/06/2017 World Business Report


30/06/2017

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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

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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

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cancelled because of an unprecedented 16-day strike

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by some cabin crew, which begins tomorrow,

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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.

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Short-haul and flights from other UK airports are unaffected.

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The Unite union says cabin crew who have taken industrial action

:01:07.:01:14.

over pay in the past have been blacklisted -

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losing benefits like staff travel, concessions and bonuses.

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BA estimates around 8% of its total cabin crew will walk out -

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To limit the damage, the airline is merging some

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It is also talking to other carriers such as Qatar Airways,

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which owns one-fifth of its parent IAG, about using their services.

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Well, upsetting its customers again is the last thing BA needs

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after a major IT crash last month stranded 75,000 passengers.

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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.

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He suggested that since Mr Cruz took over just over a year ago,

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BA has had an image problem because of cost cutting -

:02:07.:02:08.

even down to charging for sandwiches on short-haul flights.

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There has definitely been a reaction from the buying on-board for example

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and certainly this event over the last two days have affected the

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image at we have also committed to over 400 million pounds of

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investment around the product and beyond and we are going to continue

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investing in BA, BA is a great airline and has always been a great

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airline and we are committed to making it an absolutely fantastic

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airline. Under quite a bit of pressure. Have you considered

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resigning? I do think it would make much of it is for me to resign at

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this particular point in time. I am working closely with my team to make

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sure, again, that we work on the rest of the disrupted passengers to

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make sure that we address all of their needs. That was Alex Cruz, the

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boss of BA. John Strickland is an aviation

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and airlines expert Thank you for coming in. British

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Airways does seem to be having an image problem. It was seen as one of

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the traditional carriers, a step above the budget airlines. Now all

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we seem to hear in the headlines and stories of cost-cutting and the

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consequences. Putting in a business context, they are very profitable as

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part of their parent group IAG and if they didn't satisfy customer

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needs to attract business in a competitive market they wouldn't be

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that strong. They have had to take on challenges because we as

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customers are looking more and more for good prices in our travels, also

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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

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airways and Emirates. They have to invest in the premium product if it

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means we get lower prices at the bottom end by competitors, and we go

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to the competitors if BA doesn't offer them, they have to make sure

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they do the same thing and they have to look at their cost efficiencies

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they can do that without losing money. This strike starts tomorrow,

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16 day strike. What is it about? As we heard, there was a strike or a

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series of strikes earlier in the year about pay and BA's mixed fleet,

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they said that a few years ago to deal with issues to make it more

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efficient in terms of cost levels for cabin crew and productivity and

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the union in fact agreed with the airline about his art as we heard,

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BA said to those who went on strike we will take away your privileges,

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that his travel concessions or bonuses which the management could

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not justify those who went on strike and the vast majority of crew

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including those in this particular fleet did not strike said the union

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is now taking BA to task about the issue, looking to take legal action

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if they will strike over the next fortnight. How far it is supported

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is difficult to tell what it isn't about pay. What about Alex Cruz? He

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was speaking after the OT meltdown a few weeks ago, 75,000 passengers

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affected. He was saying it didn't feel it will be a benefit for him to

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leave. --I T. Three weeks later, another headline grabbing story.

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What is the industry's view? The financial community look at BA as

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part of the group IAG and financially, if successful in that

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respect. The book to the management of the company to steer it in a

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tough and competitive market to make sure that it is continuing to

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deliver profit. He has the challenge of delivering the bottom line but

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without the bottomline of course there is no future for the airline.

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Others are ready to take their lunch or dinner or whatever, local

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carriers or remember at the other end of the markets are you still

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have to with that. He is someone who has a good reputation, having

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managed other low-cost airlines but other local airlines as well such as

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American airlines. We have to wait and see what the outcome is of a

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report which they had instigated into the eye teeth out there which I

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believe they need to show that publicly. -- IT. They need to get

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into the black ink rather than the red ink. Thank you for your time.

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As we have been reporting all week, it's been 20 years since

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the financial crisis that swept through east Asia and wreaked havoc

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For the last in our series, we are in the Philippines.

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When the crisis hit in 1997, in economic terms it was widely seen

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But, as Rico Hizon reports from his home city of Manila,

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the Philippines is now one of the fastest growing economies

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Manila. The capital city of one of the most dynamic economies in South

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East Asia. With the Asian financial crisis devastated the region, the

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Philippines managed to pull through better than its neighbours, so how

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did that happen? One of the crucial factors was its economy. Every day,

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hundreds if not thousands of people queue up here to try to get their

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permits to work overseas. The money they send back helps to drive

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consumption and keep the economy buoyant. 20 years ago, remittances

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made up 6- 8% of GDP. That is nearly doubled in 2005. Today, it still

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worth 10% of the national income. What other factors helped the

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Philippines ride out the crisis and recover quicker than everyone else?

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We were late in the game in the property sector is that we didn't

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have a property bubble just yet at that time. Compare to Thailand and

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Indonesia, you know, they had a property bubble which was financed

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by debt. And at the same time learning... It was a tough time for

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many. In 1997, this man watched his empire all but collapsed. His

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building technology company was wiped out and he spent years

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painstakingly rehabilitating the luxury car dealership he began from

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scratch. It came as a total surprise. We didn't know where it

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came from, we had no idea of how it was going to affect us. And then we

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just realised that it was in a financial holocaust, a nightmare,

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every day being so fearful of what is new problems will arise. And it

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was like eating broken glass for breakfast every day. For a living

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years. What do you think, guys? But the Philippines is looking forward,

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not back. Anna is a nurse and she is typical of the new generation. In

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her early 20s, she is the average age of the population. Like so many

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Filipinos, she sees her future abroad. She is preparing to move to

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London. Hopefully he and the Philippines, I don't get paid as

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much as I work for the job. I work around 48 hours per week and get

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only as much as 356 pesos. Expanding Philippine economy has its

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challenges. A slowdown in remittances, the need to improve

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infrastructure, and tackling the poverty gap. Still, and is excited

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and optimistic about the future and so too is the Philippines.

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But have a quick look at what the markets have been up to. They have

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been trading down following what was happening on Wall Street in Europe,

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Ben McKay and the Hang Seng are down and the story is in the currencies.

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A weakening of the dollar as it looks like more central banks are

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going to start tightening monetary policy and the dollar will be losing

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some of its appeal. Both the euro and the Stirling are up against the

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dollar. More on that throughout the morning.

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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.

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