tv BBC Business Live BBC News July 24, 2017 8:30am-9:01am BST
this is business live from bbc news with ben bland and ben thompson. doctor fox goes to washington. the uk‘s international trade secretary meets his us counterpart to talk trade. live from london, that's our top story on monday the 24th ofjuly. a deal between the us and uk could boost trade by tens of billions of dollars — but can't be struck until after britain leaves the european union. also in the programme.... the international monetary fund cuts the growth prospects for the uk and us — while boosting its forecasts for china, japan and the eurozone. and how did this thing change the world 7 i sit down with the man who invented
the usb memory stick. he sold the firm for $1.6 billion but describes it as one of his biggest regrets. stay tuned and we'll tell you why. and as lab—grown diamonds become more popular, today we want to know, would you mind if the diamond in your engagement ring was man—made. let us know. just use the hashtag bbcbizlive. hello and welcome to business live. later today the uk's trade secretary liam fox will be in washington to discuss a preliminary trade deal ahead of britain's departure from the european union. a final trade agreement cannot be ratified until the uk formally leaves the eu,
but the two nations are keen to lay the foundations for what the us president expects to be, "a very, very big deal". in an interview with the bbc, mr fox said that uk—us trade is currently worth nearly $220 billion. but this could increase by as much as $52 billion if trade barriers between the countries are removed. for now though the process cannot begin in earnest because the uk is not permitted to hold formal trade talks with non—eu countries until it has left the european customs union. to complicate matters, the uk's trade secretary has welcomed a transition agreement with the eu which could potentially last up until the next scheduled general election in 2022. although this would prevent the uk dropping off a cliff—edge in 2019, it is currently unclear
whether the uk would be able to start negotiating with non—eu trading partners while the transition deal is active. marianne schneider—petsinger is geo—economics fellow with the us and americas programme at chatham house. good morning. welcome to the programme. ben running through some of the issues there. ifs, buts and maybes and preliminary deals, can't strike a deal until we leave the european union. i suppose the first question is, how likely is it that this will get done? i think at some point it will be, but for these talks, the focus is very much laying the ground work, scoping an exercise of where the trade deals might be done. also providing continuity and certainty to us and uk businesses. there are a number of regulatory and technical agreements that could be pa rt technical agreements that could be part of the discussions, whether it's with regards to data flows and
also air transport for example. we talk there about what needs to be done, certainly business wants some certainty. what is likely to be the sticking blocks? if you take a look at the trade negotiations that have been going on since 2013, lots of sticking points will likely emerge, so concerns about sticking points will likely emerge, so concerns about the importing of us chlorinated chicken, beef and also the question about financial services regulation i think could likely resurface. so where do you think the areas of perhaps easiest agreement are likely to be and where are they most likely to strike a deal? i think if you have an agreement that covers these things, that could be low—hanging fruits. there could be issues about standards, that is where the
challenges will be. with the transition period, as you pointed out, the implications of a us trade deal, sorry the uk eu trade negotiations will have implications for the negotiations between the united kingdom and the united states. if it came down to a choice between having a transitional deal with the eu or getting a us uk trade deal in place, which do you think would be the most important? 0bviously would be the most important? obviously the uk trade negotiations with the eu have priority trade. it's four times larger than anything else with the us, so that is where the key priority will be. it also strikes me then, all of this, we are talking about this cliff edge, that time is running out whether we like it or not and a deal has to be done at some point. that cliff edge is a real possibility that no deal will be done in any scenario and the uk falls off the cliff en? yes and if you have an agreement in place, again what this future relationship might be has implications for any
negotiations with the united states and don't forget that negotiations in general take a lot of time. for the united states on average it's like three—and—a—half years now to have an agreement from the start of negotiations to the implementation phase so it will be a long time. we may have to talk about this again in the future. for now, thank you very much. let's take a look at some of the other stories making the news. irish low—cost airline ryanair, has reported a 55% rise in profits in the first quarter of the year. the airline says passenger numbers grew by 12 percent to 35 million — helping boost revenues by 13%. but it admitted the figures were distorted by the timing of the late easter holidays. australia's consumer watchdog agency is investigating the recall of takata airbags after a driver's death earlier this month could be linked to faulty safety equipment. if proven, it would be the 18th fatality related to faulty airbags made by the firm.
the oil—producing companies are meeting in russia today. the ministers from the organisation of petroleum exporting countries 0pec, as well as other oil producers, with dealing with the oversupply of oil. earlier this year they came up with a plan to try to curb production in order to stop crude oil prices from falling. this news in about uber grab. they are calling it the biggest round of investment. a real power play for
these firms around the world, some of course in some countries uber— is banned, others like lift and grab managing to enter the market as a result. grab operating in seven countries, east asia's most popular ride—sharing firm. the imf has released the latest world economic outlook and while there's good news for china, japan and the eurozone there's bad news for the us and the uk karishma vaswani is in singapore. tell us more? china, the eurozone andjapan tell us more? china, the eurozone and japan have been a slight bump upwards. the us and uk are expecting to cee loer rates mainly because of the weak first quarter. the imf says the weak first quarter. the imf says the uk will grow the weak first quarter. the imf says the uk willgrow1.7%, the weak first quarter. the imf says the uk will grow 1.7%, compared with the uk will grow 1.7%, compared with the previous 2% it was forecasting, but to be honest it doesn't clarify
why. i've looked through the report and it doesn't say much more than that. the funds said meanwhile that the us would grow byjust1.2% in comparison to the 2.3% it previously forecast down to of course the fact that fiscal stimulus in the us isn't going the way everyone expected because the trump administration seems preoccupied, to be frank, at the moment. let's take a look at china. it got a slight bump up. growth rates in 2017 expected to come in at 6.7%. next year at 6.4%. both figures are slightly higher than what the imf previously forecast. as we have been talking about over and over again, all the comes at a hefty price tag. the imf says beijing, in order to achieve the growth rates will be focussing on government spending. that might meana on government spending. that might mean a delay of much—needed financial reforms and more debt to its already ballooning debt pile. that's a massive problem for the
chinese. the imf says that if china doesn't address the risks in the long—term, that could result in a slowdown in growth. thank you very much. japanese stocks dropped to more than two—week lows on monday after wall street retreated on friday. a stronger yen dampened sentiment, while investors looked for opportunities to buy small and mid—size stocks. a strong yen drags on exporters‘ shares. the dollar suffered fresh losses at the start of the week on lower expectations for under—fire donald trump's ability to push through his economic agenda. let us take a look at the european markets. earnings reports from alphabet which owns google, also am
zok and facebook will come out with their figures. samira act head joins us now. investors expect to see a rise in revenue and profit helped by advertising sales on video content and mobile devices. the company's cloud computing business is doing well, which has long been trailing behind amazon and microsoft. it managed to win some major deals for it cloud business but investors are worried about how much google depends on searches. any update on its plans to beef up its cloud business will be interesting to watch. finally, the second largest toy maker in the us, hasbro, will be reporting earnings. based on
spider—man, hasbro and other products, will be very much the reason why they'll be up. joining us isjessica ground, uk equities fund manager at schroders. nice new glasses, i approve, by the way. what is happening? they are talking about the same level of growth, still not back to pre—crisis levels. still quite vulnerable. but within that, downgrades for the us, because we haven't seen the tax reforms that people had hoped for and downgrades for us in the uk because we have had a slow start to the year and uncertainty of the election won't have helped either. uncertainty of the election won't have helped eitherlj uncertainty of the election won't have helped either. i was talking about the downgrades for the us and the uk there, but it's a different picture around the world and it shows that diverging view of some economies managing to weather the storm better than others? definitely. what is really
encouraging is that there is better news for some of the european economies and the japanese economies which have had a really tough longer term outlook. their growth is starting to come back. that's good. china looking reasonably stable and again some of the other emerging economies sort of being a bit stronger. so almost like a sort of two—speed thing. stronger. so almost like a sort of two-speed thing. as mentioned a moment ago, lot of corporate results out this week, which are the ones a nalysts out this week, which are the ones analysts will be watching closely? us tech‘s had a phenomenal run, that's been because there is this environment where growth‘s been harder to come by. people have been looking for the tech stocks to deliver that. google, alphabet, what they're doing in terms of advertising will be really interesting. similarly some of the results from the european companies are going to be interesting. europe's been rerated by investors partly because they now see growth returning. is that happening in the
bottom line of the companies, that will be interesting. as far as the potential trade negotiations with the us, as we heard at the start of the us, as we heard at the start of the programme, it's vital but there are so many question marks over whether it will get done because frankly we can't do anything until we leave the european union anyway? these things are really complex. as you have already talked about, geographically, we have trade deals with people physically close to you, so yes the us will be great and yes borisjohnson going so yes the us will be great and yes boris johnson going off so yes the us will be great and yes borisjohnson going off to australia and new zealand is fantastic. but getting the transitional trade deals with europe will be really important. thank you for talking to us about that. still to come: i meet the man who invented the humble usb memory stick. it changed the way we use computers and share data but why does he describe selling the firm as his biggest regret? you're with business
live from bbc news. here in the uk, lots of stories including ryanair, which we will get into ina including ryanair, which we will get into in a moment. profits up substantially. but let's go to the live page once again. b&m shares, the discount retailer. asda could be looking to make a bid for it. it would be £411 looking to make a bid for it. it would be £41; billion if it is confirmed. there is a huge debate about the value of these low cost retailers in the uk. they often do well when incomes are squeezed. b&m is one of the biggest success stories of late and asda are potentially wanting a slice. why? for access to that network of stores. the sunday times reporting on that early stage of assessing the
bid for b&m. plenty more on the website for you as well, including news from ryanair this morning. they are reporting that their shares have fallen by 5%. this is after the airline announced they expect fares to fall in the six months to the end of september and even further in the months to the end of march next year, despite them reporting positive results, saying that the profits soared 55% in the three months to the end... i've lost where iam! to the months to the end... i've lost where i am! to the end ofjune! i tell you someone i am! to the end ofjune! i tell you someone who know exactly which man is involved! that is the chief financial officer of ryanair, is involved! that is the chief financial officer of rya nair, who spoke to me earlier. a very strong airline. we saw our unit costs excluding fuel drop by 6% at a time in the cost of our competitors are rising. we are looking at savings on
a full—year basis. the airline is in good shape. we did see a benefit from east in april of this year in the same quarter last year. the fa res the same quarter last year. the fares will be down in the region of about 5% in the first half of the year and we about 5% in the first half of the yearand we are about 5% in the first half of the year and we are sticking to that that we see no reason to change that guidance. we are looking at fares down approximately 8% this winter. very good value for the customers at the moment. the chief financial officer of ryanair speaking to me earlier today. another story that caught my attention on the website. the electricity sha ke—up caught my attention on the website. the electricity shake—up that could save consumers up to the electricity shake—up that could save consumers up to £40 billion. this is by our environment analyst, roger. this is about how electricity is generated and stored and whether people generating their own power using solar power could sell it to the national grid. you're watching business live. our top story: later today
the uk's trade secretary, liam fox, will be in washington to discuss a preliminary trade deal. but a final trade agreement cannot be ratified until the uk formally leaves the european union. as you would expect, a lot of uncertainty about what could happen and crucially what it will mean for business. we will be discussing that at the start of the programme. a quick look at how the markets are faring. this is how they looked at the start of the trading day, the start of the trading week, across europe. all just into start of the trading week, across europe. alljust into the red, down just a shade. that is what the pound will buy you against the dollar. the humble usb. it revolutionised the way we save documents and you can carry it around in your pocket. there we go. as if by magic! and it was invented by an israeli entrepreneur. in fact, outside of california's silicon valley, one of the most exciting places for tech start—ups and innovation is israel.
the country has a record of attracting big investments from abroad. in the last three years 195 companies, together worth just over $35 billion, were either bought out or floated on the stock market. and it's a continuing trend. this year saw israel's biggest ever takeover when technology firm mobileeye — a pioneer of driverless car technology — was bought by intel for $15.3 billion. we spoke to intel about that deal on the programme. the big money deals are nothing new though. in 2006 m—systems was bought by sandisk for $1.6 billion. m—systems was founded by israeli entrepreneur and inventor dov moran, also known as the man who invented the usb. i sat down with him to hear how he turned his big idea into big money. we were going to a conference in israel, and at the end of the conference, i said, israel, and at the end of the
conference, isaid, guys, i have this amazing device that we are going to launch very soon. here it is. it is the first time you'll get to see it. the usb flash drive. and people didn't like it. there were many questions. like, why should i use this? there are floppy disks, they are cheaper, what is the price of that? 0nly eight megabytes? what is that? nothing is obvious, nothing is that? nothing is obvious, nothing is clear. what was the secret of the success ? is clear. what was the secret of the success? first of all because it is in your pocket, you see. that's one. it is easy, in your pocket. it is very simple to use. everybody could use it. you didn't have to study anything, you didn't have to learn anything. there are no problems, it just works like a hard drive. then fast forward to 2006, and you sold the company that you had created for a lot of money. tell me about that.
in 2006! a lot of money. tell me about that. in 2006 i sold the company, $1.6 billion. not so bad. not so great! interesting that you say that. on one hand, you have described that sale as your biggest excess, but on the other, one of your biggest regrets. why is that? —— biggest success. i don't regret it. you can't save you regret selling a company for $1.6 billion but i wasn't happy to sell. it wasn't my dream. the reality is that the ceo of sandisc try to approach me to acquire the company and i said no until i broke down. i said yes. it wasn't really because i wanted to sell the company. there was a
situation which i won't go into, but i was not happy with my board and the way they treated the company and acted. tell me about signing on the dotted line. you had committed yourself to selling the company. what was going through your head? mixed feelings. for a long time i had a very heavy bad feeling of disappointment. i saw it as a failure, not a success story. it took me time to accept that this was sort of success. you sold the company but it is like you retired. you have been doing a lot since then. i know you are very active in tech start—ups, especially in israel. tell me about the way that the country lurches start—ups. israel is an amazing place. lots of start—ups. but very few investors are investing in the really difficult stuff. i feel that this is
required and it is what i am doing these days. you have had a lot of failures but also a lot of su ccesses . failures but also a lot of successes. what advice would you have for people who want to emulate that success? a relatively simple idea and you turned it into a huge business. you have got to learn a lot and really understand the market very well. my advice to people is go study. understand technology very, very well. understand the market. pick market. go very deeply into this market to see what is going on, what other and requirements. then come up with an invention. —— what are the needs and requirements. fascinating interview about new technology being nurtured in israel. of course you can forget the memory stick and leave it in the computer. 0r stick and leave it in the computer. or not know which way up it goes!
you always have to try three times. now, the imf. the latest army of forecasters holding the headlines. they put it out every quarter and they have downgraded the uk's economy. they thought it would grow by 2% and now they say 1.7% this year. similar downgrade for america this year and next year. the imf has been wrong about the uk economy quite a few times in the recent past but it does provide a good snapshot of what is happening in the world. uk slowing down, the eurozone doing better, the usa stuttering. let's turn our attention to something very different. this is the washington post, man—made diamonds. traditionally diamonds are dug out of the ground at great cost. man—made diamonds in a lab. industrial diamonds have been around for a long time. you start with a sliver of diamond and you stick carbon around it and apply heat and pressure and eventually you get a
man—made diamond. many they have been used for industrial diamonds but now getting bigger and bigger and bigger and they are being used in fashion and jewellery like traditional diamonds. there is competition for the ones that are dug out of the ground. some people might prefer a man might diamond. 0ur viewers do. david says he doesn't mind the long as it is cheaper than a real rock. joe says her engagement ring is man—made and she loves it. and hopefully it puts an end to child labour and poverty still needs to be addressed. the trick is not to tell her! maybe you can tell if you are an absolute expert but they are indistinct or from the real thing because they are real, just created using chemicals. nice to see you, dominic. there will be more business news today and throughout the week. we will see you soon. goodbye. hello. it was quite worked for many
of us over the weekend. heavy showers and longer spells of rain. through this week, with low pressure close by for much of it, it will be changeable. warm spells but also wet and windy weather, particularly on wednesday. we will get onto that in a second. today, cloud in eastern areas and this weather front is gradually moving away. 0utbreaks areas and this weather front is gradually moving away. outbreaks of rain in yorkshire, lincolnshire, to boards used anglia and the south—east. further west, boards used anglia and the south—east. furtherwest, into the afternoon, the sunshine continues. temperatures across south—west england and wales getting into the low 20s. more cloud across central and eastern areas apart from some sunshine in norfolk and suffolk outbreaks of rain. brightening up in north west england and northern ireland and for most of scotland it is fine and dry this afternoon. temperatures in glasgow up to 24.
further east, more cloud, feeling cooler. 0n the coast, temperatures more like 15 or 16. the highest temperatures will always be to the west in that sunshine. through the evening and tonight, not a great deal of change. rain in eastern areas will clear away. clear spells taking us into tuesday. it should stay dry into tuesday morning as well. 0vernight temperatures down to 11 or 12 well. 0vernight temperatures down to 11 or12 in well. 0vernight temperatures down to 11 or 12 in the far north of scotla nd 11 or 12 in the far north of scotland and it could be quite cool in rural areas. 14 elsewhere. tuesday will be better in eastern and central areas with more sunshine breaking through the cloud. dry for many. some showers across scotland late in the day. rain coming into the isles of scilly and the far north west of cornwall. temperatures up north west of cornwall. temperatures up to 24. wednesday will be the wettest day of the week. low pressure here driving in from the west. armstrong winds to go with
that. not a great looking chart for late july. that. not a great looking chart for latejuly. rain, heavy in places. note is the yellow and green cropping up. all of us will see rain at some point as it moves from west to east. gusty winds followed by showers. thursday will be dry up with some showers around in northern and western areas. white cloudy at times with maximum temperatures in the low 20s. more details online. that's it from me. hello it's monday, it's 9 o'clock, i'm victoria derbyshire, welcome to the programme we'll bring you the details shortly. the parents of charlie gard are to return to court today. they've been victims of a backlash from some members of the public, they say, after great 0rmond street hospital
revealed staff received death threats. threats have been made against thejudiciary threats. threats have been made against the judiciary and medical staff at great 0rmond street hospital. under no possible circumstances whatsoever does any member of charlie's family or any of charlie's true supporters condone any such action. we have discovered