tv BBC Business Live BBC News March 5, 2018 8:30am-9:01am GMT
this is business live from bbc news with susannah streeter and sally bundock. talking tough on trade — china and europe reacts the white house — it says no countries will be exempt from steel and aluminium tariffs. live from london, that's our top story on monday 5th march. steely resolve from president trump on trade — and a new threat to tax imports of eu cars — we go live to brussels to hear the view of the european commissioner for trade — cecilia malmstrom. plus... what's next for europe's fourth largest economy after elections in italy lead to a hung parliament? and what effect of all these developments had on the financial markets? we will take a look at the openin markets? we will take a look at the open in europe. and whisky galore — we get the inside track on how
scotch whisky has become record breaking export for the uk. but if whisky has become a successful export — then how much of that is down to its name? lobbyists in the us want american firms to be able to sell their own versions of cornish pasties and scotch whiskey. should regional foods keep their protected status? let us know... just use the hashtag bbcbizlive. hello and welcome to business live. the war of words over trade has continued over the weekend, with us president donald trump threatening to "apply a tax" on imports of cars from the european union. he tweeted. .. eu trade chiefs have reportedly been considering slapping 25% tariffs on imports from the us —
including levi jeans, harley davidson motorbikes and bourbon whisky. this all follows mr trump's decision last week to slap duties of 25% on foreign steel imports and 10% on foreign aluminium. critics say if he goes ahead it will force up costs for other us firms like carmakers. meanwhile, china has warned that it will not sit idly by if its economy is hurt. cecilia malmstrom is the eu trade commissioner. joining us live from brussels. you we re joining us live from brussels. you were listening to that. can you tell us were listening to that. can you tell us what your plans are for tariffs on us imports? good morning. first of all, we need to say the final decision is due to come at the end of this week. but we are preparing because this has been in the air for
quite some time. we think this will be taxes on aluminium and steel, we think they would be erroneous. it is motivated by internal security. we cannot see how the european union cannot see how the european union can bea cannot see how the european union can be a threat to internal security in the us. so we will of course, possibly with others, take this decision to the wto. we are also looking at different safeguard measures on our own steel and aluminium. and we're looking at ways of retaliating, meaning we will taxes or tariffs on us imports to the european union. but we wait for the european union. but we wait for the final decision. can you be more specific about the process? you are saying you will go through the world trade organisation and that could ta ke trade organisation and that could take something like 18 months. will you put tariffs on goods prior to that anyway? will you react more immediately than that?” that anyway? will you react more immediately than that? i think we
will do three things at the same time. it is true that decisions at the wto take a long time, but we are convinced this is an erroneous decision, it is against the wto, and thatis decision, it is against the wto, and that is why we are talking to different partners across the world who are also upset about this and we will take the wto. but the retaliation measures, we will not wait for the wto to make a decision. can you be more specific about the retaliation and safeguard measures? it has been reported we are looking at 25% tariffs on us goods, things like levi jeans, bourbon whiskey will stop is that what you are talking about? those are things that are figuring on the draft list. we will discuss it inside the college of commissioners on wednesday morning. but they have to to be com pletely morning. but they have to to be completely legal, in compliance with the wto. we are looking at the correspondent of the economic loss that the steel and aluminium tariffs from the us will do to the eu
economy. that's why we need to calibrate that safely in order to respond, to retaliate, but not escalate this unnecessarily. how far will this go, do you think, from the point of view of the united states, the talk is very tough from the likes of president trump and wilbur ross, the commerce secretary. the trade secretary as well, they sound like they will not back down. how far will the eu go? we still hope they will back down and exclude the eu. lots of contacts are being taken at the highest level in the us. we have spoken to them for many months. i have personally spoken to the us trade relations and us commerce, and we have shown them statistics and fa cts we have shown them statistics and facts to show it's not in the interests of the us either. but it looks like if they are determined not to exclude anyone, it's very u nfortu nate. not to exclude anyone, it's very unfortunate. it will severely disturbed global markets and create an atmosphere that is not
constructive at all. thank you for yourtime, constructive at all. thank you for your time, european union trade commissioner. that's with the eu's response. we will keep a close eye on this story as it develops this week. let's take a look at some of the other stories making the news. the french insurance giant axa is set to buy xl group for $15.3 billion. the bermuda—based company specialises in property and casualty insurance. the deal is expected to be completed in the second half of this year. the accountancy firm pwc says that reducing the gender pay gap could boost oecd nations by $6 trillion. the report suggests that women could play a greater role in the labour market through increased skills and a reduction injoblessness. italy appears to be heading for a hung parliament, with exit polls suggesting that no group has won a majority in the country's general election. but as ever, one of the most pressing issues is the financial state of europe's fourth largest economy.
that was on the minds of many who went to the polls. since the global financial crisis hit a decade ago, the economy has struggled to keep up with the rest of the eurozone and suffered two big recessions. but things picked up last year with growth of 1.6%. one of the biggest election concerns for young voters has been unemployment. it unexpectedly rose last week to 11.1% as more people started looking for work. that's well above the eurozone average and amounts to nearly 3 million people. federico sa nti, europe analyst at eurasia group. welcome to the programme. what's your take on the results we have got, the five star movement and the league coming in stronger than people anticipated but this is a real antiestablishment vote we have seen. definitely, the results were
unexpected but not entirely surprising. we have been flagging it for some time, the risk of a populist government taking hold in italy has been fully borne out by the results. we are still waiting for the definitive result. the one thing that is clear, there is no clear majority. i think we are looking at lengthy and unpredictable complex coalition talks, which is something we have grown used to in europe. but at this point the chances of a government being led by a populist party are actually quite high. the five star movement is relatively new, and it has taken many people by surprise. it's not just young people voting, it's right across the board, from both sides of the political spectrum. it started asa the political spectrum. it started as a protest movement, but by this time it has fully transitioned into almost a mainstream party. they have broadened their base of support beyond this disaffected, younger and unemployed voters and they have done a good job of harnessing this pervasive antiestablishment sentiment in the country. the
question is, will they see change in the near future, or even question is, will they see change in the nearfuture, or even in the yea rs the nearfuture, or even in the years ahead? the nearfuture, or even in the years ahead ? it's the nearfuture, or even in the years ahead? it's difficult to say at this point with so many political players in there, including the likes of silvio berlusconi, who came back onto the scene. the results we re back onto the scene. the results were somewhat disappointing for berlusconi but his base was strong and i think he will be in the next for the next government, which is quite surprising. even before the vote, we did not see anything good coming out of the election in the economy and this is all the more so given the results we are seeing. do you think the five star movement gathered such support from different age groups because so many young people have left italy to find work elsewhere. perhaps their parents and grandparents are fed up and want them to return. biker said, this is pervasive, the disaffection with mainstream parties, who have had their worst performance in decades.
this is no coincidence. italy is one of the countries hit hardest by the financial crisis, the eurozone crisis, and the immigration crisis more recently. the country hasn't really grown in 15 years so this is the unsurprising effect. thank you for your time and your analysis of what happened in italy over the weekend. china has set its 2018 growth target at "around 6.5%", a faster expansion than any western economy could dream of. but behind the strong growth figures there are concerns china's economy is too reliant on borrowing, while the country has also pledged to crack down on financial risk taking. stephen mcdonelljoins us now from beijing. on the face of it, there is a great target, but underneath there are real concerns about spiralling debt and how the economy can cope. the
first day of the npc is always marked by a lot of attention for the target gdp growth. that's because it gives you an idea of how the government will try to pull various levers to try to manage this enormous economy. the 6.5% target this year is the same as last year. last year the chinese economy achieved a 6.9% gdp growth. it shows they will continue to try to step down the economy to achieve a longer lasting and more sustainable growth, given the problems with things like that, as you say. it will also pay foran 8% that, as you say. it will also pay for an 8% increase in defence spending. and a 3% reduction in the amount of energy expended for every unit of gdp. that's so china can achieve its commitments to global warming targets. it means for every bit of gdp that is achieved, more renewable energies and less fossil fuel. thank you for that update.
let's ta ke fuel. thank you for that update. let's take a look at the wider financial markets. the nikkei has fallen for the fourth session in a row. similar picture for hong kong's hang seng and australia's all ordinaries — comes after the dow closed down on friday. steelmakers, car manufacturers and shipping companies seem to be worst hit amid fears that a global trade row could break out. how is it looking so far in europe, given the results of the italian election. the ftse 100 the ftse100 is pretty flat at the moment. it's struggling to stay in the black. but the dax and the french markets have both been negative today. we have the european
figures behind me. joining us isjessica ground, global head of stewardship at schroders. i was noting that in germany, in frankfurt, the big losers were bmw shares down, and volkswagen shares also down, over concerns of a possible trade war that they could be caught up in. a bit more clarification of the weekend that this could be extended to importing ca rs. this could be extended to importing cars. people are just trying to think about the unintended consequences, whether it's through retaliation, as we havejust consequences, whether it's through retaliation, as we have just been hearing about, and also how it affects the whole supply chain. for example, the domestic oil industry in the us is a huge consumer of steel and aluminium. higher costs there, will it hit people at the pumps? how worried are you about this? listing to cecilia earlier when she said, we are ready and poised. we have thought through our retaliation. —— listening to
cecilia. it's interesting because george w bush was the last person to put tariffs on steel. but backed down when the wto got involved. the problem is, donald trump feels like a different personality and whether or not he will be cowed isn't great. retaliation is one thing, but in the long—term, markets will be more in favour of more free trade and economic activity. global trade seems to be the theme running through financial markets at the moment. also politics, we had the result from italy with another hung parliament. interestingly, we have the dax on the board in negative, even though there was quite good news as far as its government was concerned. it's swings and roundabouts. the currency as far as i understand it, the euro is feeling better about angela merkel going into coalition and it feels more significant than italy, which we a lwa ys significant than italy, which we always knew was a more difficult electoral result, certainly more colourful. the dax is really
responding, that's where the auto manufacturers are and that's where a lot of trade exposure is, so individual names are being hit. for now, thank you. she will return later to talk cornish pasties. and pies! still to come — we get the inside track on how scotch whisky has become record breaking export for the uk. you're with business live from bbc news. global demand, especially from europe, is helping uk manufacturers shrug off political uncertainty at home. that's according to manufacturers' organisation eef, which has upgraded its 2018 growth expectations from 1.4% to 2%. this means manufacturing could grow faster than the rest of the economy. lee hopley, eef‘s chief economist,
is here to tell us more. this comes after the effect of the bad weather on the uk economy, do you think manufacturers will be hit by that and supply chain issues? there will clearly be issues around logistics challenges but i don't think we expect that to have a material impact on the trajectory of the sector over the course of the next couple of quarters. we have seen a really strong 2017 and a lot of momentum is carried into this year on the back of strengthening global demand, and particularly prospects coming from european customers. so you have upgraded your outlook for this year which is good news but beyond that, what is your thinking? because that is the difficulty for manufacturers. without clarity on brexit, it is difficult to plan. there's a lot of
uncertainty around our forecasts, not least issues around global trade and increased signs of protectionism from the us for example, which could play out in a negative way for uk manufacturers. as we look beyond this year, we have to assume we do have some clarity around the brexit outcomes towards the autumn of this year as has been indicated by the government and that starts to lead to more certainty, especially as we work towards a transition period that extends to 2020 and that is critical for the sector at the moment. thank you for your time. lots more stories on the bbc news website. trinity mirror will be changing its name to reach. it
reaches millions of people everyday, is why reach is a great name for them, it says. what's more on the bbc news business live page. you're watching business live — our top story: china and europe have reacted to the white house after it says no countries will be exempt from steel and aluminium tariffs. a quick look at how markets are faring... let's talk about liquid gold. scotch whisky broke a new export record 2017, with overseas sales hitting $6 billion, equal
to more than 1.2 billion bottles. that's a lot to drink! tomatin distillery — which was once scotland's biggest whisky distiller by volume — hopes to be a key player in that growing market. since 1986, it's been owned by a japanese corporation and has focused especially on single malt. sales of that particular whisky variety have increased by 83% in the last five years and are exported to 55 countries around the world. stephen bremner is the sales director at tomatin. good to see you. thanks for being on the programme. tell us more about how you've made the most of this growing appetite globally for scotch whiskey. it is very much a worldwide phenomenon, isn't it? it is indeed, there is growing interest, especially in malt whiskey and over the last few years that interest has
grown worldwide. because of the rich history and provenance of scotch whiskey, more and more consumers are buying into that so it's been, the last few years have been very beneficial. is it part of this whole craft trend? we have seen lots of different founders and entrepreneurs who have set up their own brand. have you tapped into that, the desire for something original? yes, i think consumers now, because there is so much information available, they are very astute in what they are buying. what they want to buy is something of a very high quality. because of the regulations we have in place for the production of scotch whiskey, consumers know that they will get something that is produced to a very high standard. interesting though, a story we are looking at today is a us lobby
groups who say special protection on certain products like scotch whiskey, like champagne, like the cornish pasty should be removed. there shouldn't be this protection is it worth. what do you think in reaction to that? it must be extremely important to your business. yes, i don't agree with that. scotch whiskey has been produced in scotland for hundreds of yea rs produced in scotland for hundreds of years and as i said previously, we have very strict regulations in place as to how scotch whiskey is produced so the idea that other countries could then the dues are whiskey and call it scotch doesn't really sit right at all. you were bought by a japanese company in the mid—80s which helped turn around the fortu nes mid—80s which helped turn around the fortunes of your company but some would say that is selling out, isn't it? it doesn't mean you are now independent and really you are selling scotch whiskey. we are owned
bya selling scotch whiskey. we are owned by a japanese company but in terms of the day—to—day running of the business we are fairly autonomous. in terms of the strategic direction of the business, we are left to our own devices. we very much see ourselves as a scottish company. and you were telling me earlier about the time you were bailed out by the japanese company, 25 distilleries went bust in scotland and a lot of that was to do with the us market, big dip in the us market that the time. historically the scotch whiskey industry was tied into the american market so if there was a slump in the american market there tended to be the same situation here. but now you are more diversified and there has been a surge across asia, because we have talked about it on this programme, the fact there is a massive appetite for whiskey. yes, china is definitely a growing market. there
is much more interest in malt whiskey now, and because of the growing middle—class there many more people are interested in the prove na nce people are interested in the provenance of what they are drinking, and because of the rich history we have in scotland is people can really buy into you. we will be picking up on the theme of that protected status in the moment but first a quick reminder of how to get in touch. we have insight and analysis from our team of editors around the globe, and we want to hear from you too. get involved on the bbc business live page. you can find us on twitter and facebook. business live on television and online. what you need to know, when you need to
know. as promised jessica has returned and we will talk now about the story we have been highlighting, the fact that some goods have this protection status so champagne, scotch whisky... pork pies. cornish pasties. tell us about this us lobby that wants to see a change. post brexit when we will be negotiating more of our own arrangements, the us lobby group has made the suggestion we walk away from our protected status. we are defensive about wanting to keep pork pies and cornish pasties, on the other hand there might be opportunities for us. english parmesan could be an attractive product as well. are there areas we could innovate? these will surface in the future as we reassess our trading relationships with everyone in the world.
reassess our trading relationships with everyone in the worldlj reassess our trading relationships with everyone in the world. i want to show you this story, the world pasty championships, it was the us ba kery pasty championships, it was the us bakery that scooped the top award so perhaps we are missing out. and more competition might force us to raise our own game. "i think the monopoly of product names like champagne is pointless. cornish pasties are cornish pasties wherever they are made." and david says, they should in my personal tupperware box! there isa in my personal tupperware box! there is a fine line to be made. it's an interesting one. i'm afraid we have run out of time. thank you for your thoughts, it's always interesting to hear what our viewers think. that's it from business live today. goodbye. after the disruptive snow and severe
wind—chill of last week, this week by comparison is looking somewhat quieter. it won't be as cold, it will still be unsettled with rain around at times and also some smokes mainly over northern hills. this is the early satellite picture, two areas of cloud to look at, this has been bringing rain and hill snow for the far north of england and into scotland. this bank of cloud already bringing some heavy outbreak of rain and that will continue to work its way north and eastwards through this afternoon. i a a lot of cloud, rain and hill snow continuing for scotla nd and hill snow continuing for scotland and strong winds for the far north of scotland. a grey and drab day for northern ireland but temperatures perhaps getting into double figures for some. these
outbreaks of rain will continue to work northwards through the evening and overnight and that could bring snow over the hills of northern england, snow for scotland, rain at lower levels. misty and murky conditions but temperatures for many a few degrees above freezing so mild night. still an unsettled feel with hill snow in scotland. the cloud should fit in and break with spells of sunshine, the winds will be light and temperatures getting to nine celsius. some parts of south—east england could get into double figures. the rain stays close bikes into wednesday and we can see some weather front is pushing across the country which will generate showers at times. the focus of showers will be across the far north of scotland, wintry in nature across the hills here. these showers could become
more frequent across central and southern england, maybe some hail in the heavier ones. temperatures typically between six and nine celsius. sunshine and showers will be the theme for thursday but perhaps more persistent rain moving into central and southern england later on friday. that's all from me, goodbye. hello, it's monday, it's 9 o'clock, i'm victoria derbyshire, welcome to the programme. top story today, the shape of water, about a woman who falls in love with about a woman who falls in love with a sea creature has taken best picture at the oscars. gary oldman picks up best actor and frances mcdormand best actress. picks up best actor and frances mcdormand best actressm picks up best actor and frances mcdormand best actress. ifi may picks up best actor and frances mcdormand best actress. if i may be so honoured to have all the female nominees in every category stand with me in this room tonight. the actors, meryl, if you do it, eve ryo ne actors, meryl, if you do it, everyone else will. the film—makers,