tv Business Briefing BBC News September 2, 2019 5:30am-5:46am BST
this is the business briefing. i'm sally bundock. more protests and a general strike in hong kong — we look at the economic impact as finance, tourism and retail companies count the cost. clothes, footwear and smart watches from china all hit by fresh us tariffs on sunday, a move that'll hit the the us consumer in the pocket. and that is what is pulling down markets in asia today, as they think about the escalating trade war.
let's dig deeper into what is going on in hong kong. hong kong is braced for more demonstrations and a general strike called for monday and tuesday. the protests are the longest—running political demonstration in the territory since the handover in 1997. over the weekend, thousands of protesters blocked roads to the territory's main airport. hong kong has a world—class financial centre and stock market, and the tiny island has a gdp bigger than many industrialised countries. but its main bourse the hang seng has performed badly over the past month, with investors from the chinese mainland buying some $5.1 billion of stocks. the protests are affecting the economy, particularly retailers. on friday, retail sales figures forjuly declined 11.4% from a year earlier to just over $34 billion. then there's tourism. hong kong is one of the world's most visited cities and the demos have been blamed forjuly monthly visitors numbers falling for the first time this year to 4.8% from a year earlier to 5.2 million. visitors from mainland china, its top market, accounted for more than 80% of that fall.
today, a territory—wide general strike has been called. one major employer there is flagship carrier cathay pacific. it has 27,000 staff in the city. staff have been told they'll be fired if they walk out. the airline has been accused of bowing to political pressure from china. fahad kamal is chief market strategist at societe generale kleinwort hambros. hejoins me now. good morning, and welcome to the programme. we were hearing earlier from our correspondent in hong kong,
sharanjit leyl, from our correspondent in hong kong, shara njit leyl, about from our correspondent in hong kong, sharanjit leyl, about the great number of students that may take pa rt number of students that may take part in the general strike today and tomorrow. give us your take on how all of this is impacting hong kong? ina number of all of this is impacting hong kong? in a number of ways, obviously. part of it, as you have seen in the retail sales numbers, if you were to look into that further, the most impacted stocks on the hong kong stock exchange have been those of us rely, that are directly impacted by, real estate, consumer spending, et cetera. but if you take a wider picture, the overall market, not individual sectors, it has not really performed all that differently this year than other emerging markets such as brazil or india. so arguably, whatever the market has suffered is much more to do with the wider trade war fears than the specific realities that exist in hong kong right now. so those businesses that operate in hong kong, those international companies that have a base in hong kong, how concerned are they, do you think, about how this is progressing? because many are worried about how this may move
forward , worried about how this may move forward, how mainland china may intervene in the future. it is obviously a worry, ok? anybody who says it is not a worry would be being overly polite. one of the great plus factors of hong kong was that it great plus factors of hong kong was thatitis great plus factors of hong kong was that it is obviously a gateway to china, but one with a very high level of legal standards, on par with anywhere in the developed world. clearly that has been affected greatly. cathay pacific is one story, arguably that particular company is very amenable to china, given the fact that 70% of their flights have to go over their airspace. it is also 30% owned by ourchina. airspace. it is also 30% owned by our china. other companies, if you think about hsbc and standard chartered, two british banks, headquartered in and with great operations in hong kong, they have both put out advertisements and papers sort of supporting the beijing government. but kind of thing exists. however, let's not be naive. this was always the case. a
few years ago, hsbc, for example, spent a lot of money and nearly switched their headquarters from london to hong kong. in the end they didn't, they reversed from the decision, partly because they were well aware that the political realities in hong kong are very much influenced by china. thank you for coming in, really, really interesting. we are going to look at some of the media coverage which has been going on, some powerful images out yesterday of people walking from hong kong international airport because they couldn't get out of the airport any other way, with our bags. we will talk more about that later. america's 15% tariffs hit some $112 billion of chinese goods on sunday, including clothes, footwear and smartwatches — a move that's likely to be felt by us consumers, while china retaliated with fresh duties on us oil. despite that, president trump said a september meeting with beijing was "still on". our asia business correspondent karishma vaswani is in singapore.
markets are very wobbly today, because these new tariffs kicked in at the beginning of september. talk us at the beginning of september. talk us through the impact? well, sally, as you rightly point out, there is some anxiety over what these tariffs mean. but you have to remember that actually, what president trump had intended at the very beginning of all of this was to have $300 billion worth of goods effect by tariffs today. he decided to split that amount up. today we have $112 billion which went into effect on sunday, and later on, in december, the goods that are possibly more important to us consumers, the thinking is that that is when we will see tariffs go into effect at that time. that gives the two sides some time to try to work things out. i have been speaking with the head of hong kong's textile council, and companies and that umbrella group
make clothes for the us market, the chairman, stanley seato, told me how badly this has affected his members. —— szeto. badly this has affected his members. — — szeto. what badly this has affected his members. —— szeto. what is affecting our chinese members is the product in the middle. schultz, blazers, products were some are made in china and some are made in offshore countries. in those instances, the american buyers are shifting production from china to offshore countries as quickly as they can. so are you seeing evidence of chinese companies, your members, for instance, closing down their factories on the mainland and moving jobs away? we are definitely hearing anecdotal stories that people are scaling down, and in certain cases closing down, factories. but these things are not hugely publicised. so there are no real figures to back that up. but we are all hearing those things are happening. that is notjust because of the trade war. starting from eight or ten years ago, china's labour costs and all the social costs became quite more
expensive than neighbouring countries. so things have been migrating out of china and factory closure is not a new story. the trade war is only accelerating that pace, and making things go a little faster. interesting, but was stanley szeto speaking to our reporter. that's brief you on some of the business stories. more evidence of argentina's crisis are central banks impose controls on how much foreign currency companies can buy. the peso has lost more than a quarter of its value since elections last month, which showed president macri's business friendly government may be ousted. the economy is battling recession, rising unemployment and runaway inflation. european flights were disrupted on sunday due to a computer failure at french air traffic control. british airways said flights heading to, or passing over, france and spain had been affected, while easyjet said it had to cancel 180 flights. passengers are being advised to check the status of their flight before leaving for the airport.
uk's labour government would handover about $365 billion of shares in 7,000 large companies to workers in one of the biggest state raids on the private sector in a western democracy. the analysis, by the financial times and law firm clifford chance, also says landlords would face higher taxes. it's not only chinese goods on the radar for president trump. european cheese could get more expensive for americans, thanks to a row with the eu over state aid. the world trade organisation will soon make a final decision on damages caused by illegal aircraft aid for europe's airbus, with the us ready to retaliate with import taxes on $25 billion worth of goods. here's michelle fleury from new york. parmesan, pecorino, provolone and burrata — just some of the cheeses at di palo's fine foods, which has been selling imported italian fair on a street corner, in manhattan's little italy, since 1925. we go back 100 years representing not only the italian immigrant but also the food culture of italy.
but lou di palo, who runs the store with his brother and sister, worries that all these products may be about to become seriously expensive. if these tariffs go into effect then i have to raise my prices 50%—75%. my sales will go down and the first thing that is going to happen i am going to have to start to eliminate some employees, people that have worked for me for 30 years plus. the majority of products in this shop would be affected. how did we get here? well, you might be surprised to learn, this is everything to do with a 14—year—old dispute between brussels and washington, over planes. long before donald trump's protectionist trade policies, the us complained that subsidies given to airbus favoured the european aviation giant at the expense of its american rival, boeing. the world trade organisation, acting as mediator, upheld the complaint, clearing the way for the us government to retaliate, in order to recoup losses.
the tariffs are meant to punish the eu but the president of america's speciality food association warned his members risk being collateral damage. so it is an airbus —boeing situation, it's and aeronomics industry concern, please, leave the food out of it. we'rejust not, in relative size, big enough to be getting involved in that. lou told me, he would stock more american cheeses, if he had to, but that he would always sell italian cheese, no matter the cost. who should be the one to be hurt? it certainly shouldn't be families like mine. michelle fleury, bbc news, new york. and that is your business briefing. some british birds could be
threatened to extinction because of climate change. the bird charity, the british trust for ornithology, analysed 50 years of data for the bbc and found many common garden and woodland species are coping well but some moorland birds may suffer. nick baker has been to the peak district to find out more. the curlew, with its distinctive bill, was once a familiar sight on our uplands. but in some parts of the uk it is now close to extinction. here in the peak district, the boggy moors are drying out. which, as researchers are discovering, makes it hard for cu rlews to feed. discovering, makes it hard for curlews to feed. what are you doing? iam curlews to feed. what are you doing? i am looking up our heart of the soil is to see if they can access the invertebrates, if it is too hard they will not be able to feed. so this amazing looking bit of kit is basically a false curlew had? yes. let's see it in action, then. she is checking to see how far a curlew‘s
bill would penetrate the soil. when it dries out, the insects curlews feed on either die or go below their reach. this is probably too hard. the drying out of the moors is partly down to farming practices, but conservationists say climate change may be making things worse. the curlew, the golden pullover, they are being negatively impacted by warmer temperatures, among other things. we are seeing the bird communities around us reshuffling as a result of the changes that we see, species shifting the distribution at a pace of three or more kilometres per year. you know, these impacts are real. the btl analysed 50 years of data for the bbc and found evidence that climate change was the main factor causing the decline of a number of species such as the willow wobbler and meadow pipit. conservationists say that is why the habitats that remain must be protected. coming up at 6:00 on breakfast, louise and dan will have all the day's news, business and sport.
this is the briefing from bbc news. the latest headlines: hurricane dorian has caused widespread damage in the bahamas, ripping roofs from buildings and causing severe flooding. the prime minister said it was the saddest day of his life. there's been a day of chaos at hong kong international airport as protesters blocked road and rail links and forced dozens of flights to be cancelled. britain's conservative mps have been given a blunt message by party chiefs — block a no—deal brexit and be barred from elections. now, it's time to look at the stories that are making the headlines in the media across the world. we begin with the times, and a warning to tory mps from uk prime minister boris johnson that they will be expelled from the party if theyjoin forces with labour leaderjeremy corbyn
to try to halt a no—deal brexit this week. meanwhile, the financial times says a labour government would confiscate about £300 billion of shares in 7,000 large companies and hand them to workers in one of the biggest state raids on the private sector ever to take place in a western democracy. the south china morning post focuses on the ongoing protests in hong kong where the anti—government protesters brought chaos to hong kong's international airport on sunday, forcing travellers to walk part of the way to the city after crippling train services and blocking roads. in the independent business section, china and the us imposed extra tariffs on each other‘s goods yesterday in the latest escalation of their trade war. beijing's levy of 5% on us crude oil marked the first time the fuel has been targeted since the world's two largest economies started their trade war more than a year ago.