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tv   World Business Report  BBC News  September 20, 2017 5:30am-5:46am BST

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this is bbc world news, the headlines. a desperate search is under way in mexico after a powerful 7.1 magnitude earthquake killed at least 140 people and destroyed dozens of buildings. rescuers have been pulling survivors and bodies from the rubble. the president's office has confirmed that among the dead were at least 20 schoolchildren in one school. hurricane maria has strengthened as it sweeps west across the caribbean with winds of more than 280 kilometres an hour. the virgin islands and puerto rico are facing a potentially catastrophic impact. president trump has said the international order is under threat from a small group of rogue nations. addressing the un general assembly, mr trump said he would totally destroy north korea if it threatened america. the kenyan supreme court is due to release its full ruling on irregularities in
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last month's election, following its decision to void uhuru kenyatta's victory. his supporters staged protests outside the court in nairobi yesterday. now it's time for world business report. merging metals. tata steel and thyssenkrupp are set to combine to create the second largest steelmaker in europe. keeping the us economy ticking. america's central bank could announce a reversal of the most ambitious stimulus programme in history. welcome to world business report. i'm sally bundock. also in the programme, this is climate week in new york city —
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samira has been talking to company bosses there about the battle against climate change under a sceptical president. but first, the bbc understands that tata steel's european operations and german steel manufacturer thyssenkrupp have agreed the first stage of a deal to merge. the two companies have been in negotiations since last year when tata halted the sale of its uk business. talks had stalled over tata's huge pension liabilities. but now they're set to create the second biggest steelmaker in europe. sameer hashmi is in mumbai. tata's headquarters are there, what do you know about this? an announcement is expected any time whether companies will confirm they are merging operations in europe. they have been in talks for over a
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yearin they have been in talks for over a year in regards to merging the operations. the question was over the pension liabilities of tata, and tata arrived at a deal with the pension regulator which separates the liabilities from their business. that has paved the way for this merger. we understand it will be a 50-50 merger. we understand it will be a 50—50 merger, each site holding an equal stake —— side. the company will be operating from amsterdam. there is still opposition from the unions and thyssenkrup‘s side. both companies will have the chance to look at each other‘s books and to
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ta ke look at each other‘s books and to take the decision forward. talk us through why it makes sense for these companies to get together, and does it mean more stability for those who work for tata in europe who were concerned about their job work for tata in europe who were concerned about theirjob not long ago? they have been struggling with their steel operations in europe. tata was thinking about selling out its business completely. they announced that almost two years ago but then decided to look at other options and consolidate their business. the biggest reason is overca pacity business. the biggest reason is overcapacity in europe. chinese steel imports, cheaper compared to steel imports, cheaper compared to steel manufacturers, that has flooded the european market. that has had a huge impact on the sales of these two companies. in a way it was necessary for these companies to
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come together to battle the competition they are facing from chinese makers. they are stabilising their operation. it might lead to job cuts. there are concerns regarding that and we will hear about that in the coming days whether there will be concerns. america's withdrawal from the paris climate accord ushered in a new era in the fight against global warming, one that does not necessarily include the united states. business leaders from around the us and beyond are in nyc this week for climate week. with the us government rejecting any leadership role in combating climate change, can corporate american step in? samira hussain reports from new york. tata harvey, burma and maria, these
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storms make everything more destructive. the united states will withdraw from the paris climate accord. -- irma. in rejecting the deal, president trump said it would cost usjobs deal, president trump said it would cost us jobs and economic growth.“ we don't do anything, then we know from all of the scientific evidence that the outcome will be catastrophic. we can look at short—term needs, we are a business thatis short—term needs, we are a business that is in it for the long—term. american companies are sticking with their climate change pledges, partly because of consumer pressure. earlier this year, one mobile phone company's earlier this year, one mobile phone compa ny‘s shareholders earlier this year, one mobile phone company's shareholders said they should report how the business in packs climate change. of course we
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should, we are answerable to our shareholders. how we make that money is critical in order to sustain our business long—term. is critical in order to sustain our business long-term. pepsi is trying to make its machinery more environmentally friendly. the amount of plastic being consumed worldwide remains a massive problem. some solutions are easily implemented, but ultimately, companies are playing the long game. but ultimately, companies are playing the long gamelj but ultimately, companies are playing the long game. i think it is more helpful to have everyone on the same side. we were disappointed when the us withdrew from paris, it takes away an important signal for the market. big corporations see the financial value of implementing environmentally family policies. evenif environmentally family policies. even if the current administration in the white house does not. for financial markets today,
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the focus today is firmly on the world's most important central bank — the us federal reserve. later we're going to find out how it intends to keep the world's biggest economy ticking. the main us interest rate is currently set at a range of i—i.25% and has already been raised twice this year as the economy continues to pick—up. the other thing investors are watching is the four and a half trillion dollars worth of government bonds and other assets the fed bought after the 2008 crash. they had the effect of pumping money into the economy but will be gradually sold off amid concerns they are distorting financial markets. 0ne argument for not selling them yet is sluggish inflation. while consumer prices rose 1.9% in august as you can see it's been a bit of a bumpy ride so far this year. inflation is regarded as a good thing for stimulating economies but the fed selling assets could keep it down. the fed also aims to make sure
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as many people as possible are in work. with the latest numbers showing unemployment up slightly at 4.4% they will be wary of doing anything that pushes it up again. with me is chris watling, ceo and chief market strategist at longview economics. the consensus is, no change in growing, what do you think they will do about those assets?” growing, what do you think they will do about those assets? i think that markets are watching particularly what happens on quantitative timing. if the fed announces eight programme to wind down the balance sheet, they have sort of pre— announced that at meetings in june. have sort of pre— announced that at meetings injune. i suspect they will follow up on that and begin shortly. what are the risks of that? initially, it won't have too much impact. it is a bit like raising interest rates, it is a way of tightening monetary policy. as the fed keeps going, tightening further
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and further, at some stage, it may become an issue. for now, the policy is very loose. in the states there are some slight issues, but nothing too dramatic. it is a sensible thing too dramatic. it is a sensible thing to do. it has been talked about so much, we all know it is coming. what about the next move on interest rates ? about the next move on interest rates? in some ways, that is what is more interesting. the market is moved to price in a rate hike. that has moved up quite sharply. any comments we get from the fed in the press c0 nfe re nce comments we get from the fed in the press conference is coming out after janet yellen meets the press, or anything from a statement that hints at that, it will probably almost be more important as to where the market goes from here. we should watch and see what they say. lots of change in the team, stanley fischer,
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the chair of the central bank, he is leaving next month. janet yellen‘s term is up for renewal. what do you make of all the change? it is a lot of change. we could see a very different composition of the fed, particularly the washington central part. we will see some dramatic changes. it is up to donald trump to try and shape the committee in a way he would want it to be. there is a lot of speculation about who would be in the next chair. i suspect there is probably, it won't be as traumatic as people think and will be much the same. you are a very calm man, no drama there. in other news: european budget airline ryanair has resorted to offering pilots bonuses in an attempt to avoid more cancellations. senior pilots who agree to forego their annual leave could get a bonus of over $14,000. the company hopes the move will close the gap in rosters that have caused the cancellation
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of thousands of flights. adding to the company's problems, ryanair pilots are now threatening to go on strike. american logistics giant fedex has lowered its profit guidance for 2018, due to the impact of a cyberattack. the company said the attack significantly affected the worldwide operations of its tnt express operations. fedex also said hurricane harvey negatively impacted its first quarter results. shares in the firm — often seen as a bellwether for the us economy— dipped more than 2% in after hours trading. twitter took down 300,000 terror accounts in the first six months of this year. don't forget you can get in touch with me and some of the team on twitter. theresa may gives a speech at the un general assembly today
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and she'll also hold talks with president trump. you might think that would dominate the headlines — but another date in her diary is getting just as much attention. 0ur deputy political editor reports on a busy week for the prime minister. theresa may will use her term at the un to return to her theme of tackling online extremism. she will call for co—ordination between nations, offering british helped to countries seeking to tackle and takedown countries seeking to tackle and ta kedown dangerous content. countries seeking to tackle and takedown dangerous content. shall be meeting leaders of italy and france as part of the effort to bring about more co—ordination. it is all part of her efforts to make sure that britain continues to be a global player after brexit. that is still an issue that haynes in the air over this week. she will be going to florence on friday for the big speech. it is promised to be a defining contribution by the prime minister. this —— the speculation
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about what is in it continues in the format they believe she will continue to put money into britain to break the deadlock of negotiations in brussels. no word from downing street on that. as i say, the anticipation continues to grow. all eyes will be on boris johnson. he has been with the prime minister and is expected to be with her in florence. we will see whether her in florence. we will see whether he is entirely on her side, he says he is entirely on her side, he says he is entirely on her side, he says he is and has no thought of resigning, but his reaction to the speech is going to be critical. this speech is going to be critical. this speech could put all sorts of things on the wind, the unity of the party. it could turn out to be a great anti—climax. the stakes are so high that a simple, business as normal speech is not possible. coming up at 6am on breakfast, louise minchin and dan walker will have all the day's news,
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business and sport. this is bbc news. the latest headlines: a desperate search is underway in mexico, after a powerful 7.1 magnitude earthquake killed at least 140 people and destroyed dozens of buildings. rescuers have been pulling survivors and bodies from the rubble. hurricane maria has strengthened as it sweeps west across the caribbean, with winds of more than 248km an hour. the virgin islands and puerto rico are facing a "potentially catastrophic impact." president trump has said the international order is under threat from a small group of rogue nations. now it is time for our news review.

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