tv World Business Report BBC News September 21, 2017 5:30am-5:46am BST
this is bbc world news, the headlines. emergency teams in mexico city are trying to reach at least three people they believe are still alive under the rubble of a school which collapsed during tuesday's earthquake. across mexico, 230 people are known to have died. emergency officials in puerto rico say hurricane maria has knocked out power to the entire island which is home to three and a half million people. the head of the disaster management agency said it had damaged everything in its path. demonstrations are expected to continue for a second day in the spanish city of barcelona after tens of thousands of people protested late into the night against government attempts to stop a regional vote on independence. the us secretary of state, rex tillerson, has said that the trump administration still has "significant issues" with the iran nuclear agreement, and that the middle east has not
become more stable since it was implemented. now it's time for world business report. sally will be here for you. google strikes a billion dollar deal to buy part of smartphone maker htc. a smart move, or another costly m ista ke 7 plus eight years in the making and mired in controversy. today, the ceta free trade deal between the eu and canada finally comes into force. but can the uk still reap the benefits post—brexit? welcome to world business report. i'm sally bundock. also in the programme, toshiba's finally expected to formalise the 18 billion dollar sale of its chip unit. but the markets think the story might not be over. but first:
we start in taiwan, where in the last couple of hours, smartphone maker, htc, has struck a billion—dollar deal with alphabet, the company behind google. shares in the taiwanese company were suspended on reports google was planning a take—over of the firm. instead it is buying the mobile phone part of the company, leaving htc to carry on with its other projects like virtual reality headsets. let me give you some background to this. htc used to be one of the world's top smartphone makers, mixing it with apple and samsung. back in 2011 it had over 10% of the global market. today, the brand's market share has collapsed to barely 1%, as rivals from mainland china have pushed it out. importantly, though, it makes devices for google, like the pixel smartphone. the deal could help google ramp up its hardware production to compete better with apple. let's talk to our north america
technology correspondent, dave lee. he's in san francisco this was on the deal we were expecting when trading was suspended yesterday. we thought they would be a buyout of at least a part of htc. instead, google has entered a deal where they will use employees and expertise for a htc to continue working on google products. that is important. unlike apple, they create hardware and software, google does not have that ability to create software, like android. and that is
spread out across many manufacturers and phones. to compete, google needs to marry those two sides of smartphones to put the best features out. that is what it is trying to do with htc. htc entered the deal, quite frankly, because they really need the money. it is struggling. there was talk of making many layoffs in the near future. there was talk of making many layoffs in the nearfuture. this $1.1 million means they might not have to. and google wins because they get some of the expertise closer to their business that they desperately need. is this a smart move for google, or could it be costly, like motorola? it could be costly. they did not buy it outright. they were thinking about it. they bought motorola for $12.5 billion only to get rid of it for $3
million later on, selling it to lg us. million later on, selling it to lg us. investors might have panicked that it could be another moment like that it could be another moment like that with motorola but it hasn't got that with motorola but it hasn't got that far. this is somewhere in between a buyout and not. they are getting what they need from htc without assuming huge risk that would have come from buying the smartphone division outright. they also get what htc have been doing in virtual reality, which is a very popular device, with vive, and google want to use that as well. thank you very much, dave, currently in san fran for us. staying with tech... that's because toshiba is expected to formalise the $18 billion sale of its memory chip unit later today. shares in the company have been down sharply, though.
so, what's going on? rico hizon in singapore has been following every twist and turn of this story for us for months now! i know! hopefully we get the conclusion. fingers crossed. this whole drama has been going on for eight months. for now, we mayjust have a winner. toshiba's board has agreed to sell its prize chip unit toa group, agreed to sell its prize chip unit to a group, a business consortium, which includes japanese and overseas companies, including south korea. apple and dell will give financial support to the deal, reportedly. this could help toshiba going forward plug a massive hole in its finances following the of westinghouse in the us. but toshiba's joint westinghouse in the us. but toshiba'sjoint venture partner, western digital, is not happy about this, filing a new legal challenge
asking for arbitration. they were tipped as favourite to buy the business as recently as this week. it has taken recent action against toshiba saying it cannot take the action without their consent. so far, they are the winners, but western digital are filing an arbitration case. it is not over until the fat lady sings. the plot thickens. let's turn to canada now, because prime ministerjustin trudeau is celebrating a massive free trade deal with the european union, which finally comes into force today after eight years of talks. it's called the comprehensive economic and trade agreement or ceta. here's an idea of the scale of it.
trade in goods between the two sides was worth around $77 billion last year. the eu is canada's second biggest trading partner after the us, buying almost 10% of its exports. and that is set to grow, as the deal will eliminate the vast majority of tariffs, or customs charges, on goods and flowing between the two sides. it poses a bit of challenge for britain, which led the way in negotiating the deal but will no longer be part of it when it leaves the eu. on a visit to canada earlier this week, uk prime minister theresa may promised a "seamless transition" to a new trade deal with canada, although nothing can be formally negotiated until the uk actually leaves the eu. canadian pm justin trudeau was also optimistic. indeed, within the european union, the uk is the largest trading partner that canada has. the uk was deeply involved through the negotiations towards ceta for the past seven years. and it will form the basis for the way we move forward in a post— brexit europe. we are very confident that we are going to be able to continue strong trade ties and commercial relationships
with the uk, between the uk and canada, throughout this period of transition. iamjoined by i am joined by the president of the chamber of commerce in canada. both prime minister's where at pains to say this relationship will continue no matter what with regards to brexit. how seamers can the transition be in reality? the objective is to make the transition as seamless as possible. as you have heard, both prime minister's articulate that goal and objective. they also indicated that ceta as it stands today would have gone on the basis of those discussions going forward , basis of those discussions going forward, although, both the uk and the eu have to get through that. formal negotiations cannot take place until the of article 50 conclude. a dialogue can occur in
advance of that. talk us through the relationship of trade between the uk and canada briefly. i mentioned how important the eu is as a whole, but the uk and canada? they have a long shared history that goes back a long way. the chamber of commerce, in which i am president, in its 96 the year this year, we have had the busiest year last year and this year is going to be even bigger. the importance of canada cannot be understated. it is the export market, the uk. canada is heavily invested into the uk. the uk also exports someone invested into the uk. the uk also exports someone in the region of £7 billion every year on products and services to canada, and the expectation is that will be built upon and expanded over the next few yea rs. upon and expanded over the next few years. the intent is to develop and deepen this relationship, a relationship which is long—standing,
with ties that go back an awfully long period of time. there were some concerns about ceta. as we mentioned, there were protests in europe about environmental concerns and that kind of thing. but in terms of the impact of this new trade deal, what is the benefit for businesses trading between europe and canada? the jihad line takeaways are 90% if not more of the restrictions. —— the key headline. if you eliminate tariffs, then you will also be able to drive up trade, the direction between the two economies, and help them prosper and grow into the future. a similar example, mackerel is subject to a 20% tariff before it goes into the uk. that will go. so, it will be
cheaper! and alcohol duties going to canada will be reduced as well. so the 40 canada will be reduced as well. so the a0 billion market will be open to the uk exporters as well. yes. so, more fish and more booze. thank you for getting up so early for us. and now the fed. . the federal reserve is to start running down some of the $a.2 trillion of bond investments it made to boost the us economy after the financial crisis. the us central bank will start in october, cutting the amount it invests by $10 billion a month. at its meeting on wednesday the fed also said it was keeping interest rates on hold, but signalled a rate hike by the end of the year. the market was fairly flat in asia
but we had quite a bull run at the start of this week, don't forget. i will see you again later. goodbye for now. a group of ryanair pilots has rejected a cash bonus to work extra shifts to help reduce cancellations in the coming weeks. the airline has cancelled 2,000 flights over the next six weeks because of what it claims was a mistake with holiday rotas. frankie mccamley reports it is europe's biggest airline, carrying 120 million passengers last year. and it is not shy when it comes to trumpeting its own success. fanfare. welcome. you have arrived. the irish airline is being forced to cancel about 50 flights a day until the end of october, lending it
messed up on its holiday rosters. to make sure it does not have to cut even more flights, it is offering cruise a cash bonus of £12,000 to work extra days. but in a letter seen work extra days. but in a letter seen by the bbc, pilot representatives from 17 of the companies, company's 80 bases have rejected the offer, calling for better contracts and working conditions instead. the fundamental approach of ryanair to how it employs pilots is at the heart of this issue. and also trust, many pilots, though they see the offers, many of them have said to us we actually don't believe they will honour these agreements if we sign up honour these agreements if we sign up to them. as for those who have had theirflights up to them. as for those who have had their flights cancelled, the airline says it will refund passengers and book them onto other flights, awarding compensation to those due to fly out within two weeks. frankie mccamley, bbc news. coming up at 6am on breakfast.
charlie stayt and naga munchetty will have all the day's news, business, and sport. they'll also be live at heathrow airport to wave off some of the military veterans who are heading to canada to represent the uk at this year's invictus games in events such as wheelchair rugby, sitting volleyball, and powerlifting. this is bbc news. the latest headlines: a powerful earthquake has killed more than 200 people in mexico. in the capital, the search for survivors in collapsed buildings is continuing, including at a primary school. hurricane maria has torn a path of destruction across puerto rico. flooding and severe winds have knocked out power