07/08/2017 World Business Report


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07/08/2017

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


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Now it is time for World Business Report.

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Opec meets to check who is sticking to the rules on production cuts,

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as the price of oil continues to flag.

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We take a look at the cost of delivery around the world,

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starting in Turkey, which has the highest rate of C-sections

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Welcome to World Business Report, I'm Sally Bundock.

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Also in the programme: Financial markets start the week

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And South Korean courts are holding their closing arguments in the trial

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of Samsung's Jay Y Lee. For most of us, a lower oil

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price is a good thing. It means it costs less

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to fill up our cars, and if you run a business,

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transport and energy But for the countries that sell oil,

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lower prices is a real headache, which is why Opec, the cartel

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of 14 leading producers, Today and tomorrow,

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they are meeting in Abu Dhabi. Since January, Opec and 11 other

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oil-producing countries have been aiming to reduce global supply

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by almost 1.8 million barrels a day. That is around 2% of everything

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the world produces. OPEC hasn't formally said

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what its target price for oil is. But the world's biggest supplier,

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that's Russia, a non-Opec member, has based its government budget

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on oil selling at $40 per barrel. The biggest and most

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influential OPEC producer, But not all the countries involved

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have cut production sufficiently. While OPEC members have done far

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better at meeting their targets than non-members, collectively,

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they didn't do everything they said they would in any of the first six

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months of this year. With me is Nitesh Shah,

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commodities strategist at ETF Good morning. What will they

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achieve, if anything, in the next 48 hours? Well, I think the worst

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offenders will get a slap on the wrist and will be told to do better.

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Quite frankly there is not a lot that OPEC can do. They don't have a

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system for any sanctions or any ability to get non-compliant

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countries into line. And the non-compliant countries are who?

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Shall we name and shame them? Well, it Iraq, the UAE, Gabon have been

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performing badly recently within OPEC and then you have countries

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outside of OPEC who are part of the deal, like Kazakhstan, who have been

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hit badly as well. And in terms of the countries exempt from production

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cuts in November, will some of those come on-board? For example Nigeria?

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Yes, so Nigeria in it last meeting indicated it was willing to join the

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pact at a production level higher than what they are producing

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already. So it is not really doing much to bring well-balanced into

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line. And why has the price of oil not been pushed up more than perhaps

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it has? Is it to do with shale production going on? -- world

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balances. We live in a different world in terms of production

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globally than a few years back. US shale oil is much larger and more

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nimble and industry. As soon as you get prices around the $50 mark the

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production of US oil can increase substantially. It only takes about

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$40 a barrel for US oil companies to break even. So what will Saudi

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Arabia do about this? For Saudi Arabia it is extremely important the

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oil price remained higher, especially as it is trying to

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privatise its leading oil companies. That's right, Saudi Arabia needs a

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much higher oil price. It has valued Saudi Aramco at around $80, around

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$60 is what it would be satisfied with. It probably needs to cut

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deeper it self and hope other countries follow suit. And of course

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Aramco is coming to the market at some point, that is the idea.

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Sometime around 28 they hope to sell part of the company and they need

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that money to fill their coffers. And we shall keep an eye on that

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OPEC meeting under way today and tomorrow in Abu Dhabi.

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South Korean prosecutors are holding their closing arguments

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in the trial of Samsung's heir apparent this morning.

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Mariko Oi joins me now from our Asia business hub in Singapore.

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Nice to see you. So this is Jay Y Lee. What is the outlook? Well, we

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haven't seen any new lines just yet, but it is an ongoing trial, and as

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you say, but closing argument is taking place this morning. It has

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been dubbed the trial of the century, involving the country's

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former president, the acting boss of Samsung, as you mentioned, Jay Y

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Lee, and of course the President's friend. South Korean prosecutors are

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holding their closing arguments in the trial against him, and he has

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been denying bribery and embezzlement charges, but he is

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accused of offering nearly $40 million to the President and her

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friend in exchange for government support of a merger of two Samsung

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subsidiaries. Mr Lee could face up to five years in prison if he is

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found guilty, even longer if he is also convicted on the embezzlement

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charges. Many bosses of these conglomerates have been accused or

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even charged with bribery in the past but it is very, very unusual to

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see a founding family member of such a massive company being indicted.

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OK, for now, thank you very much indeed.

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Around the globe, caesarean section rates have increased dramatically,

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even as a large amount of them are not medically required.

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While the average rate is 28% amongst OECD countries,

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in Turkey, more than half of babies are born by C-section,

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For this mother of one, life has not always been a walk in the park. On

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the 36th week of her pregnancy, her doctor said she did not have enough

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amniotic fluids left in her womb. She was taken urgently to a

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Caesarean delivery. TRANSLATION: Women who give natural birth talk

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about how they embrace their babies immediately, how they bonded, how

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they felt their baby's arrival. I had to postpartum depression after

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birth. Was I about mother? Could I not take care of myself? Was that

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white I had to have a c-section? Here at this hospital, a babies are

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born today, five of them by Caesarean section. See section is a

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rather popular in Turkey. Over 50% of babies are born not by natural

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birth but I these operations. That rate is the highest among OECD

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countries. But why do so many expecting mothers go through these

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operations? Is it by choice or by necessity? The increase of Caesarean

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sections are due to a range of factors, including the rise of the

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first births among older women, and multiple births resulting from IVF

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treatment. But are all of these Caesarean sections medically

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justified? Five years ago, Turkey adopted a law making it the first

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country to punish elective Caesarean sections, but it still has one of

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the highest rates of C sections among developed economies. Doctors

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say the reasons for that are many, but that it is not about money. We

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don't do more than we do see section as a doctor. The hospitals, yes,

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maybe. Of course. But they don't push the doctors. If the patients as

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that, I am really afraid of having a natural birth, so what can I do as a

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doctor? Most Turkish women these days hope to give birth naturally,

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but of course, things don't always go according to plan.

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We are asking whether it is right that surgeons make money out

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Let us know your thoughts at #BusinessOfBirth.

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In other news: The UN Security Council unanimously

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approved tougher sanctions over the weekend against North Korea,

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which could cost the country $1 billion a year.

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The US and China agreed to the new measures after a month

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of talks, with the hope they will pressure Pyongyang back

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Britons could obtain more control over what happens to personal

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information, under proposals outlined by the Government.

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Citizens will be able to ask for personal data,

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or information posted when they were children,

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The proposals are part of an overhaul of UK data protection

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laws drafted by the Digital Minister, Matt Hancock.

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Let show you financial markets really quickly. They are having a

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really good session, with markets, you can see the Japanese Nikkei

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above 20,000. The Dow Jones industrial average closing above 20

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2000. Good news about the US Labour market on Friday boosting sentiment

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in Asia today so a ten year high for many of these markets across Asia as

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we start a brand-new trading week. I will see you in a minute for the

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News review. Stay with us. The police watchdog in Scotland

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is investigating after officers

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