tv BBC Business Live BBC News February 28, 2018 8:30am-9:01am GMT
this is business live from bbc news with ben thompson and samantha simmonds. brexit breakdown. the eu publishes its first formal look at how things will work once the uk leaves. live from london, that's our top story on wednesday the 28th of february. business continues to fret about uncertainty as the document says northern ireland might have to follow eu rules to avoid imposing a hard border. we'll look at the implications. also in the programme. the biggest recall in car making history gets even bigger. australia orders a compulsory return of more than two million takata airbags. and an optimistic outlook from the new boss of america's central bank with more rate rises on the cards. the dollar has jumped,
but markets are down. hello and welcome to business live. we will get the inside track on how you stop winter flu. the boss of one of the biggest vaccine companies in europe will talk to us about how healthy. with toys r us on the brink of collapse, we want to know, do you buy your toys online or in a shop? let us know. welcome to the programme. with just over a year to go until brexit as we speak, the eu is publishing a draft of the brexit treaty that will specify the terms of the uk's departure. but for business and investors there's still a huge amount of uncertainty. one of the key issues it covers is northern ireland's land border with the republic of ireland. in 2015 $3.1; billion worth of goods were traded
across it in both directions. on tuesday, the uk's international trade secretary liam fox reiterated that "the avoidance of a hard border in northern ireland is of crucial importance". that's something the republic of ireland agrees with. but businesses on both sides want to know what the future rules will be. and in the document the eu is expected to confirm its fall back position, that eu rules continue to apply on both sides of the irish border after brexit. our correspondent adam fleming is in brussels. todayis today is a significant day for anyone who watches these negotiations, today is a day which could change the future of them. yes, we will get this 120 page document with 168 paragraphs, a few protocols and annexes thrown in for good measure so not easy reading.
everyone is looking at the language about the irish border and preventing physical infrastructure. in september three options were agreed, option that a is an amazing trade agreement which obviates the border, option b means that you use technology so you don't have to have a hard border, and option c, the most controversial and the uk government's least favourite, is that northern ireland sticks to the eu's rules on trade, customs and all sorts of things. 0ption eu's rules on trade, customs and all sorts of things. option c is the option that will be detailed in legal language over a whole lot of pages today. however the document will not do options left a and b but there has not been an opportunity to negotiate that so it will all be down to the british government and their reaction. this is the first
strath of history, it hasn't even been approved by the 27 member states of the eu or negotiated with the uk yet so long way to go until its final draft. good luck, it will bea its final draft. good luck, it will be a busy for you. with me is sir simon fraser — he is a managing partner at the business cosultancy, flint global. he used to be permanent secretary at both the uk foreign office & department for business as well as chief of staff to the eu's trade commissioner. soa man so a man well placed to give us an insight into what's going on! i'd like to get your reaction to the british foreign secretary's boris johnson's comment a few days ago that this border issue is being caused to frustrate brexit, what's your assessment? i don't think that was the case, we have boys known this was a key issue and liam fox, as we have heard, hasn't said avoiding a hard border is essential. 0ne
avoiding a hard border is essential. one of the things is that the government has got to come up with a proposal outlining what it wants. we have had significant days in the past year of the negotiations but it becomes significant today, the lawyers have to get in a room and the first things out and there does not seem to be a significant position from the british government. yes, it's important, we are moving from political negotiations to a legal negotiation. 0nce negotiations to a legal negotiation. once the lawyers in the room, you have to have precision and things nailed down in the details. we know that there was a lot of ambiguity around northern ireland which has to be clarified now. that's why today is such an interesting day and wait there is —— why there is a debate going on around the sticks. you run a consultancy service, what basis is saying about this uncertainty? businesses are saying that it is
difficult in ireland and northern ireland, but it's wider than that, because irish businesses often operate via the uk into the eu. business needs certainty and they particularly wa nt business needs certainty and they particularly want a transition agreement arranged to cover the circumstances around the uk leaving and after march 2019. it will be pa rt and after march 2019. it will be part of this withdrawal agreement which is now being negotiated so it has to come together in a way that gives business clarity. what do they say to you about what an ideal scenario would be? what they want is... apart from the certainty. and an ideal scenario would be a continuation of the current rules. business wants clarity and the minimum number of changes to make, and a longer—term security, so it can make not only operational choices but investment decisions the future. we will see if we get any of
the clarity in the coming hours and days. we will keep you up—to—date. let's take a look at some of the other stories making the news. us customs will start charging duties on imports of aluminium foil from china. the tariffs of as much as 106% have been imposed after us manufacturers complained that chinese made goods were being dumped in the us at below cost price. they also allege that chinese producers are receiving unfair government subsidies. amazon has agreed to buy the video doorbell maker ring in a deal reported to be worth more than a billion dollars. it's set to be one of amazon's most expensive takeovers after its almost $14 billion dollar deal last yearfor whole foods market. it could help amazon improve how it delivers parcels. in the uk, toys r us and the electronics chain maplin are both on the brink of collapse with more than 5,000 jobs at risk. the struggling retailers are understood to have put administrators on stand—by after failing to secure a rescue deal.
the us parent of toys r us is also reported to be trying to sell its european and asian arms as it struggles with $5bn of debt. the biggest recall in carmaking history has just got bigger yet again. that's because the australian government has ordered a compulsory recall of 2.3 million takata airbags. more than 100 million have already been recalled around the world because of faults which mean they have exploded and killed at least 23 people and injured about 200 others. it's forced the japanese firm to bankruptcy. hywel griffith has the details from sydney. there was already a voluntary recall last year, the government simply not satisfied with the response. and there are concerns about what happened to some of those vehicles that have already been taken off the road and put into garages. it's understood that while some were taken in to have the old airbags taken out, they were simply given new similar airbags by the same company with the same fault. the fault increases over time, so it was a make do and mend approach.
the government isn't happy with that and therefore those cars already being taking in and new cars and models will also have to go in as part of this compulsory recall before the end of 2020. and now because this recall is compulsory, it's up to the manufacturers to bear the cost of bringing the vehicles back in and replacing the airbag with a completely different one. of course, takata is having huge global of problems with this, 100 million vehicles worldwide affected overall. the company has already filed for bankruptcy but this now will mean the cost in part goes on to the big brand car manufacturers, many of them asian companies but also the likes of volkswagen, ford and holden here in australia. so we heard from new fed chair jerome powell yesterday and he was pretty optimistic about the state of the us economy. that being seen as a sign that the fed could raise rates more than three times this year
which pushed up treasury yields and the dollar rallied against all major currencies. it appears he's firmly of the thinking that rates need to gradually increase to prevent the us economy from overheating. there is a concern that if they raise rates to quickly, it could not enough, but more than that and could overheat. we will assess all of the indications of that and that new fed chairand indications of that and that new fed chair and what that could mean for the economy. but first the details from wall street. new fed chairjerome powell's comments to congress on tuesday seemed to drive stocks lower. investors now have to wait a day for his next appearance in congress which will be on thursday. in the meantime, they'll have plenty of other news to contemplate. the latest read
on gdp, for starters. the second estimate for how well the us economy grew in the last quarter of 2017 is expected to show a slightly reduced annualised growth rate of 2.5%. that's somewhere below the 3% that president trump says he'll deliver. and there's a steady stream of corporate news. software giant salesforce is likely to tout rising quarterly revenues thanks to strong demand for its cloud competing services. the storage provider box two is also forecast to produce stronger earnings. joining us is sue noffke, uk equities fund manager at schroders. good morning, thank you for braving the snowy conditions out there. fera whether in the united states, we have been talking about this speech from jerome powell, first as chair of the fed, what did you make of it? markets have interpreted it as
hawkish. he is more plain speaking than his predecessor, janet kelland, so he had laid things out. the economy is doing pretty well, pretty strongly. plus the fact that he was highlighting that for the future couple of years, he can see the economic growth remaining quite strong because of the tax cuts that have been announced. that's going to sustain growth. inflation has been muted and has not reached the 2% fat target, so without interest rate rises, we're going to overshoot. we're ina rises, we're going to overshoot. we're in a diverse situation where it's good news that leads to falls in an equity moment. as a change to bad news leading to rises in the equity market. that seems weird to many people. yes, it's all about
what is priced in and where the tipping points are. we have this goldilocks scenario, neither not hot enough or not too hot economic news, just right. very loose monetary policy, but we're seeing that change, we are seeing tapering in quantitative easing which is slowing the amount of government bond buying this year and contracting mixture. at the same time, interest rates rising and the pace of those ahead of what people thought. so markets are expecting three rate rises? up to four. but that's only one percentage point on interest rates so percentage point on interest rates so it's not scaring the horses, but bond yields are approaching 3% for 10—year treasuries. that repricing of money is beginning to cause people to think about what products they will undertake. thank you very much.
it's that psychological shift that we're so used to with money being so cheap for so long with interest rates being so and over so long, a change could be seen as a big move. still to come... keeping on top of the flu, as cold weather grips europe one of the continents largest vaccine company's tell us how it's technology is keeping us healthy. you're with business live from bbc news. in the uk, we have had results from the commercial broadcaster itv. they reported a 5% fall in full—year profits, after a tough year for advertising however it saw growth in its studios business, which makes tv shows for the network and other broadcasters. new ceo carolyn mccall is aiming for a strategic refresh of the business. tom harrington is from enders analysis is here to tell us what that might mean.
she called it a strategic refresh but that is tough for advertising right now in the market? they announced net advertising revenue was down 5%, in line with guidance, and what has been happening in the market, the market trend, unsurprising in that regard. the last five years has seen itv moving away height quickly from a model thatis away height quickly from a model that is based entirely upon advertising revenue and towards one which gets increasingly upwards of 50% now in their production capabilities. they are protecting themselves from the ups and downs of themselves from the ups and downs of the advertising market. carolyn mccall came in from ryanair, a lot of hope split on her shoulders. can she turn things around?” of hope split on her shoulders. can she turn things around? i think she has to worry about the ingress of tech giants into the tv advertising space. she has been championing television as a safe and mass reaching medium. you can see brands
adverts online easily, not next to jihadi videos or anything like that. the itv hub has been doing a lot better. they also have the breadbox, nobody knows what is happening with that. and all of the stuff that they will show, the world cup games, that isa will show, the world cup games, that is a big one. and the perennial favourite love ireland! they have done well in 2016 and 2017 —— love island. up 15% done well in 2016 and 2017 —— love island. up15% in done well in 2016 and 2017 —— love island. up 15% in terms of share, they do have the world cup, something to look forward to. and this is the year that they cash in on love island. they did phenomenally online last year. so they can charge outrageous amounts of sponsorship and stuff like that. thank you. carolyn mccall came in from easyjet,
not ryanair. you're watching business live. the top story today, the first draft of the eu's legally binding brexit treaty is being published as we speak. there is a lot of it, about 150 pages. it will say that unless there is another deal, northern ireland will have two follow single market rules to avoid having a hard border with the irish republic. it isa border with the irish republic. it is a big sticking point as far as brexit negotiations are concerned. and a quick look brexit negotiations are concerned. and a quick look at brexit negotiations are concerned. and a quick look at the brexit negotiations are concerned. and a quick look at the european markets, all opening slightly down following negative trading on the asian markets overnight. and also on the us markets. have you fallen foul of the dreaded flu this winter? doctors and companies, suffering staff sickness, will agree it's been the worst flu
season in years. so what about prevention? our next guest runs one of the world's largest flu vaccine companies; seqirus specialises in the influenza vaccine for the elderly, and is licensed in europe and north america. the us centers for disease control and prevention said this season's vaccine is just 36% effective, only 25% against the nastiest, dominant strain h3n2. the firm says its novel method, producing vaccines in cells at commercial scale, is an industry first and overcomes the problem of vaccines being outsmarted by a mutating virus. we will ask him to explain this in a minute! but tackling constantly mutating flu strains needs cutting—edge innovation. so it's focusing on its liverpool plant — one of the biggest biotech sites in europe — with a £60 million investment. gordon naylor, president of seqirusjoins us. a warm welcome to you. let's talk
about how you, first of all, manage the mutation of the flu virus and try and precipitate that, when you are creating a flu vaccine itself. the influence virus is a wily foe and it constantly changes and co nsta ntly and it constantly changes and constantly mutates. there are multiple strains. there has been a whole global collaboration which has been working since the 1940s to find out how to respond. that rapid mutation is the reason why we have to have a new vaccine every year. so fourie manufacturer like ourselves, who are global, we go through two product and development cycles, one for the southern hemisphere and one for the southern hemisphere and one for the southern hemisphere and one for the northern hemisphere every year. we were just talking and i'm staggered at how much planning you have to do. 0nce staggered at how much planning you have to do. once you have decided, 01’ have to do. once you have decided, or the organisation, has decided
which strains of the virus you will tackle, you have a lot of work to do before it hits the market. it is quite a challenge. as you know, there was snow on the ground here in london, we are in the middle of a serious winter. we have been manufacturing for several weeks now. this will take us into the next northern hemisphere winter.! months from now? yes, the world health organisation directs free agencies on which virus strains are to be manufactured, and they made the decision on friday. this year has been really bad around the world for those suffering from flu and the number of deaths. why is that? is it because the vaccines are wrong, or because the vaccines are wrong, or because it is a wily foe, as you said? influencer is a pretty -- influenza is a pretty serious disease. around 650,000 people per yeardie disease. around 650,000 people per year die globally from influenza out
ofa year die globally from influenza out of a backdrop of 5 million cases, many. this year has been particularly serious, we have had elevated levels of serious illness and mortality around the world. these virus strains are particularly difficult, especially for the more vulnerable elderly. the challenges because of this long lock in effect, and we had to make the decision early, this virus continues to mutate and it can make it difficult to catch up. the other challenge is we know that for most manufacturing, which is done in eggs, that sometimes there is an effect where the virus changes a little bit as pa rt the virus changes a little bit as part of that manufacturing process which can make it more challenging. that is what we are seeing, we think, in much of the markets this year. as sam says, it has been one of the worst flu seasons in decades.
i hesitate to use the phrase "good news" for you but as a business selling a vaccine to tackle flu, how does work financially when there is such a bad flu season, do your sales go up? we would to think so but in many of our markets the reality is we made those manufacturing decisions many months before we knew the severity of the season. so that means you cannot particularly plan, if there is a big upswing, you cannot get the vaccine out quickly enough to cope? it is difficult for a manufacturer to respond rapidly. you tend to make a little more than what you expect will be needed but that's about the only measure you can take. it is good to see you this morning. good luck for next year! thank you. a pairof smart a pair of smart shoes has been created to help industrial workers keepin created to help industrial workers keep in touch via toe typed coded messages.
rory cellanjones met messages. rory cellan jones met the messages. rory cellanjones met the inventor and mobile world congress in barcelona. morse code. in the year if the internet, it seems everything is connected, including safety shoes. this one has got a sim card in it. this is inside, what is it doing? so, this product has a smart sim card embedded in it and a wireless module to send a message from a worker, a safety message, from his team, to send an alert or to get the other way around, a message from his manager. telling him to stay safe, in case of a hurricane or a big danger. so just moving up the toe or pushing a button on his shoe, it will send a message directly to his team or the other way around. so the manager can send a message and
the shoe will vibrate, telling them that there is a message. it will do a lot of noise. 80 decibels of sound, to warn him of an alert. i hope they make them in red... great story, the latest technology from rory cellan—jones there. an update on our top story. we've just heard from the irish prime minister saying it is up to britain to bring proposals to the table as far as the border is concerned. there is a lot of concern as to whether there will bea of concern as to whether there will be a hard border between northern ireland and the republic. he said it is up to britain to bring such proposals to the table. full coverage of that at the top of the hour. sue has rejoined us to talk about some of the stories in the paper. we have been talking about
electric cars, and the market for them. sometimes you can't plug them the guardian newspaper says that isn't the case at all. they are quite expensive as well. i have an electric car. the range is not as good as i would like to be. there is a lot of development going on, we are going to see some more models coming onto the market give consumers more choice at different price points as well. and a quick word on our other story as well, the future of toys "r" us in the uk. the american firm said it is trying to sell a number of units, could it disappearfrom sell a number of units, could it disappear from the uk? it could, it hasn't kept up with the times or student demands for service and flexibility. i think the future is pretty bleak. a quick too sweet, someone says they go online for convenience, it isn't always the cheapest option —— a quick tweet. that's it from business live today. we'll see you again tomorrow.
it has been a bitterly cold start to the day. temperatures widely across the uk down to —11 degrees. 0n temperatures widely across the uk down to —11 degrees. on top of that today, more disruptive snow in the forecast. met office amber warning is enforce this morning across lincolnshire, essex, kent, 10—15 centimetres of snow here. the focus will shift towards this eastern rhetoric and north—eastern quadrant, there will be heavy snow showers moving in. thunder snow mixed in with that, we could see to of 20, 25 centimetres across the central belt and more of that interests. elsewhere, sunny spells and light snow, temperatures not moving far above freezing. factor in a strong easterly wind, it will feel like it is about minus 6——12d out there. a bitterly cold day. through the
evening and overnight, further snow moves evening and overnight, further snow m oves a cross evening and overnight, further snow moves across parts of south—west england, southern dorset and hampshire. heavy snow moving into north—east england, in and across scotla nd north—east england, in and across scotland as well. more accumulations on thursday. a very cold night again. best temperatures well below freezing. during thursday, we keep a close eye on this area of low pressure. this is storm emma, as it hits the cold air. more met 0ffice amber warning is. across wales and south england, in central and southern england, this is where we could be seeing more severe disruption on thursday, particularly in the evening with heavy snow moving through here through the course of the day. again, we are looking at up to 5—10 centimetres, more than that in places. elsewhere, those heavy showers continue in the
north—east, elsewhere bright spells and snow showers. there are blizzards expected during thursday. it will feel bitterly cold once again. blizzards continued during friday across parts of the southwest. into northern ireland. that will move further north and east into western england, and the midlands on friday. more disruption is expected through friday. temperatures are not getting above freezing. a lot going on over the next few days. stay tuned to the forecast. goodbye. hello, it's wednesday 28th february, it's 9 o'clock, i'm victoria derbyshire, welcome to the programme. amber warnings for snow are in place for large part of the country. drivers have been one to take care, hundreds of schools are closed and public transport is widely affected. with more snow overnight
and temperatures falling as low as minus 12, some councils have brought in emergency measures to offer immediate accommodation to people sleeping on the streets. we'll be talking to one rough sleeper and two people who have a roof over their heads but can't afford heating. a key document detailing the proposed terms of the uk's departure from the eu has just been published. it says northern ireland will have to follow the rules of the eu's single market if no one can come up with a plan to avoid a so—called hard border with barriers and checks. we are absolutely clear there will be no hard border