tv BBC Business Live BBC News August 22, 2017 8:30am-9:01am BST
good morning. this is business live from bbc news with ben thompson and rachael horne. trading with trump south korea steps up to the table to negotiate a new trade deal with the world's largest economy. live from london, that's our top story on tuesday 22nd august. south korea and the us may be staunch allies when it comes to north korea. but today the two sides will face off on a trade deal that trump says is "horrible". and mining big returns, bhp billiton bounces back from losing billions to making billions in just one year. and that's because commodity prices have soared but why and what else is moving the markets; we'll get the expert opinion on all your need to know. and we'll be getting
the inside track on the growing demand for getting big sound from digital speakers with the boss of devialet. rising house prices in the uk have lead to a sharp rise in homes little bigger than a budget hotel. so today we want to know would you or do you live in a micro home? just use the hashtag bbcbizlive. hello and welcome to business live. do you think at 6'6" do you think at 66" i could riv in a microhome? probably not! get in touch with us with your stories. the importance of trade deals between big economies is back in the spotlight this week. hot on the heels of canada and mexico — now it's the turn of south korea to renegotiate its trade deal with the us. president trump has already described that pact as ‘horrible‘ and threatened to axe it. south korea is america's sixth biggest trading partner.
since the deal came into effect, the us says the trade deficit has doubled from $13 to $27 billion — it's importing much more from south korea than it sells to the country. but some experts say that mismatch could be even greater if there was no deal in place. that deal eliminates 95 per cent of tariffs on consumer and industrial products — as well as creating closer economic ties. and they also highlight how much south korea's is investing in america — up from $4.8bn in 2011 to a record $12.9bn last year. joining us from beijing is miha hribernik, a senior asia analyst at global risk consultancy firm, verisk maplecroft. thank you very much forjoining us on the programme, miha. donald trump has a problem with this growing
deficit. he thinks they affect manufacturing jobs in the us, something that is very important to him. is there any evidence this trade deal with south korea has damaged jobs in the us? well, u nfortu nately, damaged jobs in the us? well, unfortunately, any free trade agreement will have a negative impact onjobs, agreement will have a negative impact on jobs, particularly agreement will have a negative impact onjobs, particularly in manufacturing and other industries that are unable to compete either in terms of cost or in terms of quality with goods and services coming from abroad. now, that does tell only pa rt abroad. now, that does tell only part of the entire story. if we only look at the automotive sector for example, it's frequently cited as one of the biggest victims when in fa ct one of the biggest victims when in fact the tariffs on imports of korean cars were at 2.5% even before corus came into effect and remained at that level until last year when they were abolished. so the us auto industry has a lot of problems, this
free trade agreement doesn't tell the whole story. i would go back to the whole story. i would go back to the figures you cited earlier, looking atjob creation, there's evidence that suggests that tens of thousands of jobs created evidence that suggests that tens of thousands ofjobs created as a result of the agreement, if we are just looking at the impacts of direct foreign investment in companies, that figure is about 45,000. what about south korea? how thatis 45,000. what about south korea? how that is this trade deal been for them? they are not calling for it to be axed like donald trump is? well, for the south korean side, these calls for renegotiations come at an u nfortu nate calls for renegotiations come at an unfortunate time, at a time of increased tensions tonne korean peninsula when president trump and president moon need to coordinate as closely as possible and essentially having a trade dispute will make this very difficult. there was a pole published by a research centre recently suggesting that more south koreans trust vladimir putin to do
the right thing in international affairs. they trust him more than they do trump and so the perception of the us president essentially forcing renegotiation of a trade deal on one of the us's closest allies is not going to win him any friends. as far as the government and negotiating tactics are concerned, it seems like they'll try to delay negotiations as soon as possible. they see the deal as mutually beneficial and they have stated that any renegotiation will need to be preceded by a come preheroin sieve study of the impact of corus since 2012, including on job creation. briefly, miha, last weekend's negotiations were inconclusive for nafta. what would be seen as a successful outcome of the negotiating talks there?m depends on which side you were to ask. 0bviously, depends on which side you were to ask. obviously, the key goal of the united states is to bring the deficit down, as well as south korea
seeing the deal as essentially win—win, as they frequently describe it. so i think there'll be a very difficult and protracted process ahead. thank you very much. let's ta ke a look at some of the other stories making the news. johnson &johnson has been ordered to pay more than $400m to a woman who says she developed ovarian cancer after using products such as baby powder. johnson &johnson has defended the products' safety and says it plans to appeal. the british airline pilots' association says it's backed a strike by thomas cook pilots in a row over pay. the dispute comes after nearly eight months of negotiations over a pay rise that was due in april. pilots will walk out on september the 8th. shares in great wall motor company have been suspended on hong kong's hang seng index. the company admitted on monday that it was interested in making an approach to fiat chrysler automobiles, in particular itsjeep brand. the mining giant bhp has returned to profit — making almost $5.9bn over
the past twelve months. it got a big boost from higher commodity prices, and that helped it bounce back from a big loss last year. hywel griffiths is in sydney. it's interesting because we have talked a lot recently about falling commodity prices and therefore the direct effect on companies like bhp is that they struggle. we have seen exactly the reverse this last few months? absolutely, after doom and gloom across australia which has benefitted a lot over the last decade from commodities, it could be back to the good times for companies like bhp who've made nearly $6 billion in profit, driven by the demand from china for prices being up demand from china for prices being up 32% and also products like the coal and oil, the traditional commodities bhp sells across the world. a good day for them,
especially considering last year's losses. maybe not quite reaching as high as the analysts expected. certainly the profits for rio tinto suggested the whole sector is in a boom time and still good enough to triple the dividends to the bhp shareholders. you can see on the screen there, the bhp share price up 32%. we find out whether the central bankers will give anything away later. the chair of the us fed and the president of the european central bank later will have their say. we heard one bright spot for asian markets was the performance of the
mining sector, all metals doing well. let me show you what is happening in europe. there'll be that interest later in the week in what mario dragi has to say. any indication that the european central bank is thinking about cutting back with tapering, that may come later. michelle has her assessment now on what matters on wall street today. investors will be watching cote's results, the perfume maker expected to announce a rise when it posts its results. second quarter results out for other companies. revenue at the cloud based software firm is expected to go up despite increased
opposition from oracle. the housing market will be in the spotlight this week, toll brothers turns in its results for the third quarter. profits and revenue likely rose. the us federal housing agency is expected to increase housing price index forjune. joining us is kathleen brooks, research director at city index. thank you very much for coming in. let's start with commodities, ben and hywel were talking about that with the bhp results. we are seeing a surge aren't we? yes. the steel price has tone really well and the copper price. these less top tier commodities you don't hear about. all has been floundering a bit. if you dig deeper, there are things going on. when the fundamentals are doing well, that's when we should see the share price doing well. that's very good for the ftse 100. that's very good for the ftse100. the iron sector is worth about 20% of that. where is that demand coming
from? traditionally of that. where is that demand coming from ? traditionally it's of that. where is that demand coming from? traditionally it's been china p°ppin9 from? traditionally it's been china popping it up, we have seen that slowing down in china and anecdotal evidence suggests it's not coming from china this time. who is buying this stuff? you are seeing a mixture. when demand slows or growth slows in a big market like china, you see the commodity companies immediately start to ramp down production, so that leads to a bit ofa production, so that leads to a bit of a supply issue in those commodity markets because it means there's not enough. so when growth starts to pick up again, like in europe and the us growth is ticking along nicely, european growth is very strong and nice and broad—based as well, when you see that pick up, all ofa well, when you see that pick up, all of a sudden, there is a massive demand for the metals, shooting the price up. it's not as smooth as you think it would be. this morning i said what should we talk about and you were saying, there's nothing, it's quiet. everybody‘s waiting a little bit for this jackson bank talks. what are you expecting them to say? not much. you have different
authorities, none of them want a strong authorities, none of them want a strong currency authorities, none of them want a strong currency husband we are in a le inflation environment, high equity prices and strongish growth. the risk is, if you say something, say mario dragi says yes, we are going to taper, stocks will fall and the house of cards come down. it's a race to the bottom, no—one wants that to happen. we may talk about this again as the week goes on, if there's nothing else to talk about some times in august! for now, thank you very much. still to come...the sound of success? would you spend big money on posh, high end speakers? we meet the man behind one of france's audio success stories who's just secured 100 million euros infunding. you're with business live from bbc news. supermarket sales in the uk grew 4% year on year, despite a bad summer
hitting seasonal sales. each of the top four supermarkets increased market share for the 5tgh quarter in a row, according to latest figures from kantar. theresa wickham is a retail analyst. you have been looking through the numbers. good morning. it's a familiar tale isn't it, that the supermarkets are all vying for the same customers but interesting they've managed to increase share? yes, they have. they've tackled the point of the discounters very clearly by having less promotions and more regular prices. that's what customers want. also they're growing their online sales, so they've had good growth this time. when we talk about the competition between the traditional supermarkets and the discounters, you're right, what a lot of customers have told us is just keep it simple, stop confusing us just keep it simple, stop confusing us with all the offers. that message, you are suggesting, has got through now? definitely it got
through now? definitely it got through on the regular things people buy every week. they've tried to keep the prices low there and also advertise the fact, that this is a regular price, it won't change. 0ther prices have gone up, food has gone up and it's bound to go up, partly because of the weak pound. what are we spending our money on because we saw sales of ice—cream down 9%, burgers down 25%. that's a sad reflection of the summer we have had? yes, we'll be buying a lot of fresh produce this time of the year. fresh produce sales have gone up, strawberries, raspberries, that sort of thing and of course, once the schools are out, families are looking for big bulk buys and shop for value. if we look on the bbc news website one of our tops tory tizz about the ford scrappage scheme. scrappage scheme for pre—2010 cars. they are
also accepting petrol cars, but cars registered before 2010. this is really to do with all those manufacturers coming together trying to do something about the clean air issue and moving towards electric, towards hybrid. just a month ago we reported the uk government said by 2040 we would be looking towards all new hybrid and electric cars, no more petrol or diesel. full details on the website. you're watching business live. our top story — south korea and us began talks on possible revisions to a five—year—old free trade agreement, as the us administration seeks to follow through on president trump's pledge to cut deficits with trading partners. there is a big trade deficit.
america importing more from south korea than it sells. president trump does not like that. a quick look at how markets are faring. not a huge amount of movement. the ftse and the dax up about half percent. lots of investors waiting to see what happen? towards the end of the week, waiting to hear from the central bankers. she believes will not get any big headlines. we will not get any big headlines. we will keep talking about the market spooling through this. now, how do you listen to your music? on your smartphone? through headphones? or with super hi—tech, top notch speakers? well apparently the market for high end, expensive audio speakers is booming. and one french firm is cashing in. devialet makes them, and hasjust received one of the biggest funding rounds in french history, raising over $100 million from companies, including sharp and renault. devialet‘s co—founder and chief executive, quentin sannie joins us. quentin, thanks for coming in. tell
us quentin, thanks for coming in. tell us why you got involved with this in the first place? you talk about sound being about emotion. where does that, from? it is coming from a dream when i was very young, 40 yea rs dream when i was very young, 40 years ago. my dream was to create a company in audio. 0ne years ago. my dream was to create a company in audio. one day, ten years ago, my friend called me and he had found a guy who had invented a wonderful technology to amplify the sound. this technology can change everything. we founded it together and said up the company in 2007. from this time, what we are going to do is put out technology step—by—step in any device providing sound. this is the kind of device we are doing with the devialet brand. the plan is to put the technology in
your car, your tv, your smartphone, and provide the sound of the future, more emotion. you are trying to put it in these different devices. it strikes me like —— that devices like these are getting smaller and televisions are getting flatter. speakers need space to move the air and make the sound. how do you do that? it is already what we are doing with this product. this product should be 30 times bigger to provide the sound it is providing. 0ur provide the sound it is providing. our technology, because we are using hybrid technology, our technology is changing the way that we are providing the signal to the speaker. with this technology we can reduce the size of the audio equipment. it isa the size of the audio equipment. it is a big advantage. with this
product we reduce the size. this product we reduce the size. this product is providing 14 hertz. you don't need that kind of sound in your smartphone. step—by—step we will provide this technology. we will provide this technology. we will provide this technology. we will provide a great sound in a tiny space. just like your smartphone. you say you can do it better than anybody else. what is different about the sound that you create and is it -- about the sound that you create and is it —— do you have to be a sound engineer to hear the difference? no, everybody can feel it. when we are talking about someday, a lot of people say they are not experts, physicians, but switch off the image in yourtv and physicians, but switch off the image in your tv and when you are watching a movie a lot of the emotion is coming from the sand. and everybody
is able to feel it. what we are providing is sound without noise, without distortion, the pure sound of the reality. you are able to feel it. we are very skilled. we have wonderful abilities to recognise a very pure sound. you talk about putting such technology in things like cars. it strikes me if you are driving ina like cars. it strikes me if you are driving in a car, you have got traffic noise, sirens, horns, people around you. it is not that pure environment. it's not like you are sat in your lounge with a big—screen tv and cinema. it would be noisy. is it necessary? we love that because there are a lot of problems to fix. the kind of application in your car is different to what you can have in your tv and your living room. in your tv and your living room. in your car you have sound insulation. you have to deliver a different
sound for the driver. safety information, routing information access. the driver can listen to one thing and the passengers something else? yes. at the same time the car is autonomous, electric. you are saving kilometres. you are able to deliver a car that can go further. that is the purpose of our technology. to be smaller and to be lighter, and in a carto technology. to be smaller and to be lighter, and in a car to fix many problems you have delivering with the sound in different places in the car. quentin, thank you for your time. 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 businesslike pages where you can stay ahead with all of the days breaking news. we will keep you up to date with insight and analysis
from our team of editors around the world. we want to hear from you. from our team of editors around the world. we want to hearfrom you. get involved on the business live web page. you can find us on twitter and facebook. business live on tv and online whenever you need to know. we arejoined now online whenever you need to know. we are joined now by online whenever you need to know. we arejoined now by dominic o'connell to talk smack through all of the business news happening today. you picked up the ford scrappage scheme story. any car you ta ke scrappage scheme story. any car you take them that is older than february 2009, they will give you a £2000 incentive. it is about air quality, that is what they are claiming. really it is about political heat on car—makers over diesel, i think. political heat on car—makers over diesel, ithink. volkswagen political heat on car—makers over diesel, i think. volkswagen in germany is offering you 10,000 euros to buy a new diesel car. the one
difference with ford, they are scrapping old cars. this applies to petrol cars as well? yes. it has just been diesel before that. previous scrappage scheme —— schemes have been from governments. getting the wheels of the economy turning. excuse the pun! car sales are reducing. it is about clean air quality. the trumps bar lago club losing its ninth big charity event this week. it is interesting. this is donald trump's main resort in florida. a local charity has said it will not hold a dinner dance there.
$240,000 worth of business has passed trump by. they say they can't book it. there are negative effects on trump's business. he will know that. you will think about it. that is quite a personal thing. when that. you will think about it. that is quite a personalthing. when he goes down there in the winter, the ballrooms will be empty. absolutely. it was thought that he would use the presidency to further his business interests. he didn't think it would harm them. i would imagine that o'connell towers is a vast palatial mansion. we are talking about microforms today. house prices soaring in the uk. some people living in smaller houses. a lot of people getting in touch saying the problem with cities, we have some e—mails. caleb says house prices have allowed these hot property prices to bloom to nonsensical figures. it is a problem, isn't it?
it isa figures. it is a problem, isn't it? it is a problem of urban concentration, rising house prices. microforms are a feature of the japanese market. they have been in london for a while as well. it is not particularly new. what is interesting about this story is it is spreading to the midlands. some of the smallest properties they found were in leicester. they found one which was one square metre larger than a prison cell. that was in greenwich in london. no thank you. thank you. macy says she has just moved to the country. live with nature, you get a bigger house. 0scar says his student house was perfect for one person. thank you for your comments. that's it from business live today. there will be more business news throughout the day on the bbc live web page, and on world business report. we'll see you again tomorrow. good morning. we have got a lot of
tropical air sitting across many parts of the uk at the moment. that is bringing a muggy start. temperatures widely into the mid to high teens. also, a lot of tropical moisture sitting in this warm sector. you can see it between the warm front and cold front. this air giving lots of mist and mark. that should thin and break up. there will be some goods sunny spells over many parts of england and wales. some showers into north west and wales and north—western england later. for scotla nd and north—western england later. for scotland and northern ireland early morning rain will clear away. sitting in the fresh air. heavy showers developing in inland scotland. later, heavy showers moving south and west. heavy showers for northern ireland. heavy showers
eventually pushing into northern pa rt eventually pushing into northern part of england. from any price, sunny spells developing. not wall—to—wall sunshine but still feeling very warm. through this evening, these showers across northern ireland eventually pushing away into scotland. this warm sector containing the warm humid air, gradually moving away towards the east. behind it, fresh air will start to come in from the west as we go through wednesday. a fresher feel from any. some showers in northern england in the morning. those showers could be heavy. eventually clearing away into the north sea. from many other places, drier. showers in the west. temperatures down by a few deg. 19 celsius. still very warm in the south—east of england. going through wednesday night, that cold front bringing fresh air moves away. all of us under the influence of this air
stream. that will bring low pressure. that means an unsettled picture on thursday. blustery conditions. a mixture of scattered showers, some sunny spells, temperatures about 16 to 21. fairly similaron temperatures about 16 to 21. fairly similar on friday. most of the showers can find to the northern pa rt showers can find to the northern part of the uk. further south, it should be largely dry. temperatures between 17 and 20 degrees. bye—bye. hello it's tuesday, it's 9 o'clock, i'm joanna gosling, welcome to the programme. donald trump has changed his mind about withdrawing us troops in afghanistan. he said he will send in more troops and that the us will fight to win. he said he will send in more troops