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tv   BBC Business Live  BBC News  June 30, 2017 8:30am-9:01am BST

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this is business live from bbc news with rachel horne and susannah streeter. more trouble on the radar for british airways as cabin crew prepare to strike, just weeks after an it crash that stranded thousands. live from london, that's our top story on fridayjune 30th. scores of flights will be cancelled over the 16—day walkout, with many asking if the cost—cutting is worth it. also in the programme: as the week draws to a close, we assess the fallout of the major cyber attack that hit businesses around the world. and the markets? yesterday, europe had its worst day for about nine months and today, not looking quite so months and today, not looking quite so bad but the ftse is still down. we will be looking at the figures. and we'll wrap up the tech stories with our guru rory cellan—jones — including that record
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fine for google. also, fine for google. as packets of weetabix are inhabited also, as packets of weetabix are inhabited new zealand, we want to know what you can't live without when you go on holiday. is it your pot of marmite or your tea bag? it's the tea bags for me. let us know. just use the hashtag bbcbizlive. hello and welcome to business live. we start with more problems for british airways. thousands of passengers are learning that their flights have been cancelled because of an unprecedented 16—day strike by some cabin crew, which begins tomorrow, july 1st. on thursday, ba said most flights will operate as normal, but it has cancelled a number of long—haul departures to and from heathrow. short—haul and flights from other uk airports are unaffected. so what's it all about? the unite union says cabin crew who have taken industrial action over pay in the past have been "blacklisted"
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losing benefits like staff travel concessions and bonuses. ba estimates around 8% of its total cabin crew will walk out. that's about 1,400 staff. to limit the damage, the airline is merging some heathrow operations. it is also talking to other carriers such as qatar airways, which owns one—fifth of its parent iag, about using their services. well, upsetting its customers again is the last thing ba needs after a major it crash last month stranded 75,000 passengers. the financial cost was some $100 million — but the cost to ba's reputation — possibly much greater. alan bowen from agb associates is with me. he is an airline analyst. this has really become a very entrenched stand—off, hasn't it? and it is more
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than just pay which is at stake. yes, it started with pay. it relates to cabin crew who began work after 2010 and they are on a very different and much lower pay scale than different and much lower pay scale tha n staff different and much lower pay scale than staff who were there before. but that has been resolved but ba took the view that because they went on strike, they would lose all the additional benefits they are entitled to. what will happen now? this is coming right in the middle of the holiday season, really, at the start of it, anyway. how much disruption is there going to be? interestingly, ba seems to have leased aircraft from qatar airlines. interesting choice. indeed, we are aware they are bringing in nine aircraft to operate flights which they might not be able to operate themselves. the number of staff going on strike maximum appears to be about 11100 and they have a total of 15,000. their intention is to operate as many flights as possible. they have promised but we will have to wait and see whether it happens, that they will get everyone everywhere they want to beat but they've cancelled about six
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long—haul flights in the they've cancelled about six long—haulflights in the next they've cancelled about six long—haul flights in the next seven days. on short—haul, theiraim is long—haul flights in the next seven days. on short—haul, their aim is to ensure they operate at least one flight ensure they operate at least one flight per day on all routes so you may have to fly at a different time but their intention is to get eve ryo ne but their intention is to get everyone to their destination. interesting choice of qatar airlines given that they have been isolated in recent political events. indeed, qatar has its own problems at home and it is also a shareholder in iag, the holding company of ba and for the holding company of ba and for the middle east, this is low season because temperatures are very high and people are not travelling. it is and people are not travelling. it is a win—win from that perspective. let's talk about ba's reputation because it was traditionally seen as the flagship carrier, a step up those budget offerings but it feels like all the recent headlines have been about cost—cutting and its consequences. how been about cost—cutting and its consequences. how the airline being viewed? 0range mackreth a lot of people are beginning to wonder whether it has still been the world's favourite airline, it cut food and drink from short—haul
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flights so you have to buy a sandwich on board if you want it. it has upset most of the travel agents in europe with an announcement they are going to charge additional fees for travel agents to book them from the 1st of november. and obviously, we had the disaster on the bank holiday weekend. it is not looking great. thank you forjoining us. let's take a look at some of the other stories making the news. deutsche bank has again rejected demands by us house democrats to provide details of president donald trump's finances, citing privacy laws. deutsche bank has loaned the trump organisation millions of dollars for real—estate ventures. the european union is appealing a recent world trade organisation ruling in favour of the us over its state aid for boeing. earlier this month, a wto dispute panel found the us had dealt with all but one of the instances of illegal subsidies to the aerospace giant. two montessori schools in new york won't let parents pay by credit card — but they will now accept bitcoin. the schools added the option after a growing number
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of enquiries from parents. the decision comes as more and more places — including universities in london and greece — no longer accept the digital currency as payment. have you ever paid for anything with bit groin? i certainly haven't. me neither, i would bit groin? i certainly haven't. me neither, iwould not bit groin? i certainly haven't. me neither, i would not know where to start. let's take a look at some of the stories on the business live page and let's talk about rasp reply, the computer. i thought you we re reply, the computer. i thought you were bringing in pudding!m reply, the computer. i thought you were bringing in pudding! it is a microcomputer and the company behind it said they had no idea it would be so it said they had no idea it would be so big. it has sold 1a million of these tiny microcomputers, mainly aimed at schools but they have now gone into a number of businesses and industry as well and rasp reply has just won a top innovation prize from the royal academy of engineering. ——
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roseberry pie. rory is going to bring us in one. but not edible, sadly. a chinese bank and a shipping firm have been hit with sanctions by the us over allegations of support for north korea. let's get more with tim mcdonald who's in singapore. tim, this is a real ratcheting up, perhaps in relations with china by the us? well, it is interesting you say that. in fact, the us has kind that it not really so much about sending a message to china as just focusing on the entities involved. in this case, as you've mentioned, two chinese citizens, a shipping company and the back, which the us says are connected to north korea's weapons programme, the bank of dandong which the treasury department has zeroed in on is for all intents and purposes just a local chinese bank, not well—known beyond the city of dandong itself but it's on the border with north korea and one of the few places
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where there is significant traffic into and out of the country and the us says about 17% of its transactions are with entities that have us or un sanctions on them for connections to north korea's weapons programme. the us once again says this is about sending a message to china, as well as the entities involved. they continue to work with john on this. —— this is not about sending a message to china, just the entities involved. they are continuing to look at the entities which may be helping north korea. thank you forjoining us. let's ta ke let's take a look at the markets. the markets in asia followed the mood of europe and wall street yesterday, trading down — why? those signals from the world central banks that the almost decade—long era of low interest rates, cheap money, is slowly coming to an end. that is obviously a positive view and, given that the markets are susceptible to sentiment, you might expect the optimism to have a positive impact, but some investors are concerned that the world economy might not be able to take the interest rate rises. europe yesterday had its worst day
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for about nine months, and the dax. a few months ago but it is down and the ftse is down. let's go to wall street and see what is happening there. us markets should be quiet on friday ahead of what is likely to be a long weekend giving the 11th ofjuly public holiday on tuesday. still, there is some economic data for investors to consider. the university of michigan consumer sentiment index is released and the last reading this index showed consumer sentiment at its lowest level since the presidential election in november. economists are not expecting it to have risen significantly. there are no big company earnings out but that does not mean you should not keep an eye out on energy stocks. 0n not mean you should not keep an eye out on energy stocks. on thursday afternoon, president trump gave a speech boasting of the strength of america's energy industry and claiming new initiatives would be
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coming to boost power, natural gas and oil production. maybe that will bring some cheer to investors in those industries. michelle fleury in new york. joining us isjeremy cook, chief economist, world first. rachel was talking earlier about the impact on the financial markets, particularly european indices and asian indices and the us, the fact it looks like it is the end of the era of easy money but what is happening to the currency? era of easy money but what is happening to the currency7m era of easy money but what is happening to the currency? it is and some currencies, the euro and sterling, normally during the summer doldrums, everything trades sideways but this is the time where central bankers around the world have decided to inject a bit of volatility into the markets. sterling and the euro have both gained in the past week as the bank of england and the ecb respectively have said we should be getting prepared, or certainly policymakers at the central banks are saying getting prepared for rate rises. they are happy with where rates are at the moment but they want to say
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rate rises are coming soon. explain why that is. if the dollar is more in demand? the best way to think about currencies is like savings accounts. where are you going to put your money? if i gave you both £10,000 now, i'm a generous guy, and said you could put it in a savings account, savings account that pays you 2%, or4%, you account, savings account that pays you 2%, or 4%, you will put it in the one that pays 4% but if they both pay 2% and you think the second one will hike in interest rates, more money will flow into that so investors are looking at it that way. excellent interest -- excellent explanation. and data coming out of china as regards to factory output, what is that showing? manufacturing pmi rising a bit so this is sentiment in the manufacturing industry in china, the largest in the world, the second largest economy in a while and if they are doing well, that should flow through the rest of asia and manufacturing is normally the first thing to roll higher ina is normally the first thing to roll higher in a new input or spurt of
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economic growth. if china is doing well, hopefully the rest of asia is doing well and a lot of the economic centre of gravity has shifted there, given the pick—up of southeast asia in the past ten or 20 years. thank you forjoining us. and i know you will come back to talk through some of the other stories in the papers. some interesting ones. what can't you go abroad without? have a thing. still to come — record fines and cyber attacks — it's been a big week in the tech world. we'll make sense of it all with the man in the know, our technology correspondent, in a few minutes. you're with business live from bbc news. a survey of uk consumer confidence suggests it has fallen to the lowest level since last june's referendum on european union membership. researchers at gfk, which conducted the research, found that the biggest drop was in people's willingness to go out and spend. and later today, we find out the final figure for economic growth in the first quarter of this year, which was revised down to 0.2%.
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well, let's get more with our business correspondent theo leggett. let's start with the growth figures. remind us what figure we were given initially at where we stand at the moment. the figure we were given initially for the first quarter was 0.3% compared to the previous quarter. that has since been revised down as more information comes in, to 0.2% and we are expecting it to be finalised at about that level and thatis be finalised at about that level and that is a significant slowdown from the tail end of last year when the figure was 0.7%. any indication that consumer confidence is declining is worrying because it suggests that could weigh on growth in the future. that is true, the consumer confidence... but are there other indications of why that is? several factors could be at play. 0ne indications of why that is? several factors could be at play. one of them is clearly uncertainty caused by the general election. if you compare this survey with another one
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that came out earlier in the week from yougov, that suggested that consumer confidence was reasonably sta ble consumer confidence was reasonably stable up until the election and then declined quite dramatically afterwards but you have to factor in other matters as well. the decline in the value of sterling since the referendum last year, that is starting to feed through to inflation. 0ne starting to feed through to inflation. one thing we are seeing in this survey is that people are becoming more reluctant to spend on big—ticket items like washing machines and pieces of furniture. the simple reason is, those things are becoming expensive. if they are imported, they will certainly be more expensive. there's pressure on wages as well, wage growth is not what it once was. the combination of things getting more expensive and people not feeling they are going to get any wealthier, that may be suppressing consumer as well. —— consumer confidence. thank you for joining us. another story we want to tell you about on the business page, trinity mirror has allocated more money to phone hacking claims, setting aside
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an extra £7.5 million to cover claims related to the hacking of phones which adds to the £26 million it had already earmarked to pay for that. it has settled cases with dozens that. it has settled cases with d oze ns of that. it has settled cases with dozens of celebrities, the newspaper group. you're watching business live. our top story — british airways prepares for a major walk—out by cabin crew that will ground some of the carriers‘ scheduled flights. it comes only weeks after an it glitch caused chaos for the airline. a quick look at how markets are faring. it is red across the board at the moment. the ftse 100 it is red across the board at the moment. the ftse100 down and there are concerns about the era of easy money coming to an end that has affected the stock markets and the currencies. and now let's get the inside track on tech. this week, google was slapped with the eu's
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largest ever fine for distorting the market. the european commission fined the tech giant $2.7 billion after it ruled the company had abused its power by promoting its own shopping comparison service at the top of search results. and a large—scale cyber attack involving malicious software disrupted firms' computer systems, hitting ukraine especially hard, but spreading to countries as far apart as norway and india, the us and germany. let's find out more with our technology correspondent rory cellan—jones. let's start with this cyber—attack, it seems as though it was mainly targeted on ukraine, but spread out. when glitches, the patches weren't put in places that's right? when it first happened, we thought is it a repeat of that attack we saw around the world. it does appear to be similar, but different in crucial ways. yes, it appears to have been targeted at ukraine and there is suspicion being thrown at russia,
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but the technique is different. it looks like the other one. but it is actually wiping data. it is not actually wiping data. it is not actually they think about gaining money, it is a malicious attack which indicates it could be state—sponsored. which indicates it could be state-sponsored. but it hit a russian airline. once the attacks are out there, their effects can be unpredictable. now that google fine, higher than many people expected. yes it was a real marker for how determined the european competition is and it has opened up a split between europe and the united states. europe says we are complying competition law. voices from america
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saying, you're biased against our successful company. all the company has done is be the best in its field and used its skills to conquer a market. europe believing that google is abusing that dominance in one area to spread into other businesses. remind us what they did? it is about shopping services, put a name ofa it is about shopping services, put a name of a product into google, put in leather shoes and a box comes up with adverts and when you click on one advert, google earns money. 0ther price comparison sites are available, but you will struggle to find them in a google search. available, but you will struggle to find them in a google searchlj spoke to companies who say their businesses have been affected and other search companies, by the practices. it is difficult to get back into the market. could it lead to more innovation in europe. the argument from america is the
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opposite, it is punishing innovation and the european commission doesn't understand how business works. google says people have a choice and they say their big rival is amazon and you go there. perhaps there could be more competition do you think in certain areas of the world where the dominance of google has been reigned back. the bigger picture, experts say this is possibly the wrong target and there is the dominance of three or four american technology giants and concern around the world the regulators need to do something to hold that back, to attack that, otherwise we won't see the innovation we expect. thank you. we are going to be talking about raspberry pis. it is not a dessert.
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it isa raspberry pis. it is not a dessert. it is a tiny computer launched in 2012 in an attempt to change the way children understood computers and to get them programming. it has had a bigger effect than expected, the reason we are talking about it is la st reason we are talking about it is last night it was awarded the biggest annual prize for engineering, the prize that has been won by rolls— royce engineering, the prize that has been won by rolls—royce and lots of huge projects, it has won it, because it has gone beyond being an educational tool and it is ending up in factories, the 40 million that are sold are ending up in factories. factories, the 40 million that are sold are ending up in factoriesm started off to encourage children to get into coding. yes it had modest ambitions and they expected to sell tens of thousand, it is a charitable aim, the bigger project is encouraging kids around the world to
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get into coding. sojust a great example of how something can snow ball, a bit of engeneral youty, came from —— ingenuity. ball, a bit of engeneral youty, came from -- ingenuity. have you coded with it? yes i'm very inexpert, but idid with it? yes i'm very inexpert, but i did manage to make a radio with this. i was very proud of myself. so you're never too old to learn. that is what i'm told. thank you. in a moment we'll take a look through the business pages but first here's a quick reminder of how to get in touch with us. the business live page is where you can stay ahead with the business news and all the latest details with insight and analysis from the bbc‘s editors around the world. we want to hear from you too. get involved on the bbc business live web page. jeremy is back to look
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through the papers. we will start with that cyber security story, this is is an innovation that happened to bark cards in —— bank cards in france, where the three little numbers on the back, there is a computer screen on the card. that is incredible and the numbers will change on an hourly basis, if somebody finds your card there is a numberthat basis, if somebody finds your card there is a number that is always static. so this is to try and cut down the online fraud, which has boomed, as we have decided to shop more and more online, i think, it is something like 28% of all us commerce something like 28% of all us commerce is online at the moment. so
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imagine the size of the amazons and that when it gets to 50%. but the fraudsters are taking advantage. interesting this has come from france, actually chip and pin was first developed in france you go to france and think what is this? and it took us a few years. you go around the world and chip and pin which we treat here in the uk and in europe as de facto and contactless, in the united states for example, you still have to sign for things. there is a long way for the security protocols to become the same. but this is fighting the fraudsters. now weetabix has been seized in new zealand. in a breakfast bowl battle. post—brexit relations with new zealand are already fraught. we
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asked our viewers to tell us what they can't go without. this has been shipped to new zealand to be sold in a ship in christchurch. alan said, hp sauce, crumpets. 0ne a ship in christchurch. alan said, hp sauce, crumpets. one said my lap top. 0ne hp sauce, crumpets. one said my lap top. one said, are they impounding weetabix to try and stop the british lions. yes we will need all the help we can get on saturday. this is about weetabix and weet—bix that is the new zealand version. there are hundreds of packets. 300 boxes not being served into this small business, a little bit of britain, that sells things to ex—pats there. this is a portion ofjust, i'm
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looking at it through t kaleidoscope of brexit. we will have to sign deals to stop this. there will be trade marks that exist any way. yes, but in the grand scheme of things, these businesses don'tjust exist in new zealand, there is a very big one in new york which i pop by and you see people buying 12 pound boxes of yorkshire tea. one says, when i go abroad, i mustare yorkshire tea. one says, when i go abroad, i must are a a packet of digestive biscuits. . i have to have cheese and onion crisps. don't eat them on the plane. thank you for coming in. there will be more business news throughout the day on the bbc live web page and on world business report. r) we'll see you again tomorrow. it has been very wet for some of us
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and in edinburgh you have had more rain injune than the previous five months combined. this was the scene in edinburghfrom months combined. this was the scene in edinburgh from one of our weather watchers, localised flooding there. it isa watchers, localised flooding there. it is a better picture this morning. not so much rain in scotland. still damp. some rain in wales and the south—west of england. going through the day, strong winds down the irish sea around the coasts. you will notice that specially. some rain continuing in the northern and western areas, but brighter skies in central and south eastern areas. let's look at things this afternoon, still wet in devon and cornwall, with that strong northerly wind, not feeling pleasant. for the south—east, a few showers and they could be on the heavy side between the bright spell bes. cloudy and
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damp in wales. some showers in northern england, but largely dry. drier in northern ireland and for most of scotland it should be dry this afternoon. but with an onshore wind it will stay dreary in the far north—east with cloudy skies and drizzle. tonight, rain will spread south through yorkshire, lincolnshire into east anglia, the south—east of england, just stalling in the south—east for saturday morning. elsewhere, clearing skies, temperatures down to about 13 or 14 degrees celsius. for saturday morning, you may start off with rain in the south—east. that clears and this ridge of high pressure moves in before this next weather system. so in this ridge of high pressure, a window of drier, calmer, brighter weather. for many it is a dry day, more rain in the far north—west of scotla nd more rain in the far north—west of scotland and northern ireland later in the day. that is associated with
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the next weather system. the temperatures 24 degrees with light winds. 0n temperatures 24 degrees with light winds. on sunday, a few showers across southern areas, but they will clear and a few showers in the far north—west. quite a breeze here too. temperatures about 15 to 19 degrees with sunny spells. so this weekend much better than the last few days, much better than the last few days, much drier and brighter conditions to be enjoyed. hello, it's friday, it's 9 o'clock, i'm joanna gosling, welcome to the programme. documents seen by bbc news suggest the cladding recently fitted on grenfell tower was nearly £300,000 cheaper than the type originally chosen. this latest development in the fire's aftermath comes as a council meeting last night descended into chaos. an absolute fiasco, this is why i'm calling for your resignation, not because of what happened with the fire, but the sheer and ongoing incompetence that this council has shown ever since it happened. we'll bring you the latest
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from the scene in west london. the end of a long and desperate journey. the parents of ten—month—old charlie gard — who lost their fight to take him to america for experimental treatment — say his life support will be switched off today. it's going to be the worst day of our lives.
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