tv BBC Business Live BBC News September 27, 2019 8:30am-9:01am BST
this is business live from bbc news with susannah streeter andvictoria fritz. france says it will slash taxes again next year. could other countrys now follow suit as fears over the global economy grow? live from london, that's our top story on the 27th of september. french may be the language of love but is the country's president's latest budget speaking the right language for investors — we take a look. also in the programme — the battle over india's vaping ban hots up. we look at why the worlds e—cigarette business is in danger
of going up in smoke. and the latest from the markets, this is how they have opened up in europe. and we'll be getting the inside track on the big tech stories of the moment, including mindreading gadgets and a week to forget for office rental firm wework. also — japan airlines has introduced a child icon on its seat booking system — is it a good idea? what do you reckon? what else would you want to be informed of before boarding a flight? just use the hashtag bbcbizlive. hello, and welcome to business live. we start in france, where president macron‘s government will present the budget for 2020 to parliament later. it will include more tax cuts for working people, as the government re—focuses on boosting household incomes after the wave of yellow vest protests that swept the country. on thursday, france's economy minister bruno le maire announced that taxes will be cut by more than 10 billion euros next year —
to address what he called a "social crisis". the government claims 95% of households will be better off. the tax cuts come despite weak economic growth in france. official forecasts are for it to slow to 1.3% next year. the macron administration pledged to reform the economy and balance the books by slashing public spending. but widespread protests have derailed that. it certainly looks like they have. with us now isjessica hinds, european economist at capital economics. thank you forjoining us. in your view, does it work, does tax cuts boost growth? they will certainly have some effect. hopefully these tax cuts we will see to income tax mean french households have a bit more money in their pockets next year. but, they do also, they need to think about the long run, policymakers. that's it, this whole
deficit reduction rhetoric appears to have completely disappeared from politics and it's notjust in france but in the uk as well. tax cuts for working people for yet another year. can the government actually balance the books longer term, is even interested in doing so?” the books longer term, is even interested in doing so? i think the french government is interested in doing so. you see the pledge of deficit reduction from macron and his administration but they have had to pull back after serious protests in france and now even more over controversial pension reforms which will be the focus of the second half of his presidency. how supportive is fiscal policy to an expansion of fiscal policy to an expansion of fiscal policy? monetary policy is very supportive but as we saw from what the ecb president said only last week, he said we do need to see fiscal policy stepping up and taking some of the control back from monetary policy. france has urged germany to follow its example with
budget stimulus. we are seeing budget stimulus. we are seeing budget stimulus. we are seeing budget stimulus happen across the world. this appears to be the new norm, in terms of fiscal policy. are the likes of germany going to follow the likes of germany going to follow the likes of france and the likes of the likes of france and the likes of the us, for example? we at capital economics have been clear, while germany has the fiscal space to do so, we think it is pretty much wishful thinking that we are going to see a meaningful fiscal push from germany. interesting. they are constrained, essentially, by european rules, as to how much they can spend? although what we have seenin can spend? although what we have seen in italy, there have come down quite hard on italy, in terms of the fa ct quite hard on italy, in terms of the fact they believe that actually italy is in keeping to those rules. there is at risk, isn't there? for germany? france? yes, it's butting up germany? france? yes, it's butting up against the european rules, its deficit won't fall next year by as much as brussels would like. but macron is properly making the judgment that it can get away with
it for now and certainly with the calls from the likes of druggie that fiscal needs to play a greater role, he's probally hoping he will be able to get away with it for now. there has been an impact as well on climate change policies in france because france was one of the leading lights when it came to introducing quite ambitious aims to cut carbon emissions, but that's kind of been thrown out now because they have reversed the fuel duty increases, didn't they? what do you think will be next, in terms of climate change policy for france? macron at the g7 summit was keen to push climate change policy as a key. that did go down very well with the french public. i think he has to balance at that, though, with the needs of french people, not in paris but in the rest of france, who do rely very strongly on their cars to commute to work and he needs to work
out whether domestic policy and getting through these structural reforms he thinks are necessary to improve the french economy and to make it more productive, he needs to balance those two things. a tricky balance. thank you, jessica. see you a bit later. let's take a look at some of the other stories making the news... delta airlines says it plans to buy a 20% stake in chile—based latam airlines for $1.9 billion in cash and newly issued debt. the deal with south america's biggest airline will give delta a much biggerfootprint in the region. it would be the us carrier's biggest investment since merging with northwest airlines over a decade ago. saudi arabia will open its doors to international tourists for the first time as part of a broader push to cut its economic dependence on oil. the kingdom is planning to launch a visa program for 49 countries and relax strict dress codes for female visitors. visas have until now largely been restricted to pilgrims, business people and expatriate workers. brexit carries real risk
of disruption to britain's medicine and healthcare supplies — according to the uk's public spending watchdog. a report by the national audit office says the government has taken some steps to manage the risks — but there is still significant work to bedone. 37 million packs of medicine a month are imported into the uk from eu countries. shares of high—tech fitness bike firm peloton have slumped on their first day of trading on the nasdaq — closing down ii%. it's the latest disappointing stock market debut for a start—up company — pointing to a growing scepticism among investors about loss making firms with multi—billion dollar valuations. two companies are challenging india's ban on the sale, import and manufacturing of electronic cigarettes in the high court in kolkata. health officials say they are ready to defend their decision after two seperate challenges filed by importers. major players in the vaping market
have plans to enter the indian markets. first, jagdip cheema is in mumbai. the global vaping backlash grows... at least these two companies want to reverse the recent ban. they say goes too far, don't they? yes, the first court hearing is set to next monday. this really is the vaping industry fighting back. obviously we had the ban last week over health concerns but the vaping industry here is complaining that the government has been too excessive in terms of the tax levels that they have placed on firms involved. for a basic vaping set here, it cost around $16. a smoking equivalent, a 20 pack of cigarettes, costs only around $2. they claim they never really stood a chance. they are also concerned about the government's sta ke concerned about the government's stake in itc, which is india's
largest tobacco firm. obviously, they come as a result they believe they come as a result they believe the governmentjust they come as a result they believe the government just wouldn't they come as a result they believe the governmentjust wouldn't give the governmentjust wouldn't give the vaping industry a chance. and was looking for any reason to clamp down. on them. thank you very much for that update. that is a story we will keep across. now it is time to checkin will keep across. now it is time to check in with the financial markets. shares in asia have fallen to three week lows — the launch of an impeachment inquiry into us president donald trump seems to have added to concerns about the overall global economy, already reeling from the china—us trade war. that's despite reports that trade talks have been scheduled for october tenth. the dowjones in the us also closed down on the last session. let's take a look at how europe is looking today. a lot more buoyant. the ftse 100 a lot more buoyant. the ftse100 up just under 1%. pretty buoyant so far. now to the us, where boeing has been criticized by regulators over its warning systems and pilot procedures and training. vivienne nunis has
more from new york. the message for boeing here is that it needs to pay more attention to how pilots react in emergency situations. the national transportation safety board has said the crews in both fatal boeing crashes didn't react in the ways the company and the federal aviation administration assumed they would, and that boeing didn't look at all potential flight deck alerts the pilots might face in a system failure such as this. all 737 maxs have been grounded since an ethiopian airlines plane crashed shortly after take—off in march, killing 157 people. it followed a lion air crash of another 737 max which killed 189 people last year. in both accidents, investigators have focused on the role played by a software system, which was designed to make the aircraft easier to fly. the planes will remain grounded until aviation authorities around the world deem them to be safe to fly. joining us is justin urquhart—stewart, director of seven investment management.
hello. how are you? absolutely chipper, thank you. lets talk trade, china's trade shenanigans go on decades through many presidents but do we have white smoke, do we have a new date and hope that maybe they thought might come good at some point, may be next month?” thought might come good at some point, may be next month? i love your optimism! it is a friday! looks like there is a little progress that frankly don't believe that until something appears on a piece of paper with some signatures on it. this is having a tangible effect on global trade because quite rightly, china is finding ways around it. they will manufacture elsewhere. they will manufacture elsewhere. they have been setting up low—cost operations in places like indonesia, bangladesh and hull but also it is having an effect internally in the states. these changes of tariffs ta ke states. these changes of tariffs take about two or three months to work their way through. now they are beginning to see them, particularly
in the run—up to christmas. those gadgets getting more expensive. they find a way somehow. what new trading partnerships to think china well established to try and offset the losses it is making with the united states ? losses it is making with the united states? what it is trying to do is effectively re—root the same goods. so just try and put it on to other flags. the alternative which you are saying is this issue about the currency. people always accusing the currency. people always accusing the currency of being rigged but actually what they are trying to do is make sure that there is regular trading in there, so that would help greater stability. but will encourage more trade? i'm afraid the economy of the world... it's a bit like a balloon, it won't go bang but you can hear the air slowly seeping out of it. justin, thank you very much. that's all we have time for for now but i know you will be back later to talk through some of the paper stories we have. thank you. still to come — we know what you're thinking! well, not really — but facebook has just bought
a company that says it can read your brain waves. will it? stay tuned to find out what they think your thinking. you're with business live from bbc news. now — an update for you at the end of the week on thomas cook. this time last week we were warning that the company faced collapse. that was confirmed on monday and since then, the biggest peacetime repatriation of passengers has been under way. the civil aviation authority says it has now flown 61,000 customers back to the uk, that's about 40% of passengers abroad at the time of the collapse on monday. let's speak now to theo leggett who's been covering the story for us all week. theo — how successful has the repatriation been so far? we're still hearing some horror stories of really long waits and people being presented with bells at hotels? looked at subjectively, you
have to say that has been a remarkably successful operation. 61,000 people already brought home. 275 flights operated. 95% of them on the same day that people were due to fly with thomas cook. so, yes, there have been horror stories. people have been horror stories. people have had to wait a long time in airports but look at what has been achieved as well. this was basically achieved as well. this was basically a shadow airline set up from scratch. the civil aviation authority had to cobble together a fleet of 45 aircraft, then try to match in some way be schedules of thomas cook, all in a very short period of time. there were inevitably going to be problems. some people have had a pretty miserable experience, no denying that but getting so many people home so quickly, with an operation that has had to be put together at short notice... i think as a whole, taking it objectively, you have to say it's been a pretty successful operation so far. what next falstaff? on social media some have been tweeting
asking for a job because they simply don't have any prospects. what have they been told? 6000 of them so far have been made redundant. another 3000 are still working for the dregs of what was thomas cook and ultimately the number of redundancies will grow. they can get redundancy payments from the insolvency service and there will be a meeting in manchester today of many staff, so they can find out more information. ultimately, other companies are rallying round to trying to provide openings that thousands of staff who have sadly lost theirjobs. ok, thank you very much for that update on thomas cook. plenty more on that story and loads of information for you, if you are stuck abroad or also if you are a former worker at thomas cook. the place to go, the bbc website, then go to business. you're watching business live — our top story — france will slash taxes again next
year to tackle what the finance minister calls a "social crisis". a quick look at how the markets are faring. and actually, starting the session in positive territory. we saw some losses in asia in the last session and also wall street as well. good we have a little bit of optimism spreading through the european session. from amazon's alexa new celebrity voices to facebook‘s mind—reading technology — there's been a lot to get your head round in the world of tech this week. always! wright and we always have you. our technology correspondent — rory cellan—jones joins us to look at some of big stories you might have missed. amazon, to great fanfare, they said we are going to get alexa out and about come out of the house and she can sound like samuel l. jackson if you wish. what are we supposed to make of this? amazon are holding one
of these big annual events. it all started with apple having these big shows, where they show off something new. amazon holding its big one in seattle and really stressing that it is taking alexa out of the speaker that has become very common, that has become very popular and controversial in some peoples homes, into different places. for instance, there will be a pair of glasses where you can talk to your glasses. do you want to do that? i think it's a bit weird! it will be linked to your phone. people are already talking... ear pods and whatever. that is a key point, they are taking point apple on this. at the moment, alexa is confined to the phone. it's very powerful. outside the home, people are talking to their phones, may be to the google assistant, to siri, amazon wants to be there as well. whilst we are all talking to ourselves, it seems, in the street, then facebook says it will start
reading our minds. how is it planning to do that? this is a purchase facebook is made of a company called control labs. a tiny start—up which has developed a wristband that basically reads the signals coming from your brain to your hand. and translates them into an action, feeds into a computer. here is what the facebook executive who unveiled their said, "it can also capture your intention". that sound scary fuzz that you can share a photo with a friend just by an imperceptible movement. this is a big new area, a lot of research going on in this area of brain computer interface. control is the right word, do you think people are ready for this amount to control the tech companies may well have over our lives? already they have a lot but just by the flick of a wrist... ? there are two questions here. do we genuinely want this kind of
technology? it is important technology, it's being used to help people with long—term conditions like parkinson's. but it is also very controversial. obviously. where does the human being and then the computer start? the other big thing is facebook, of course. do we want facebook in more areas of our lives? already a very controversial company and when it makes a purchase like this, the spotlight is on it. absolutely, it really is. generally, the reception has not been positive from the public in terms of this facebook thing and this mind—reading. but they have been into this for a while. wasn't it 2017 they said they were trying to do this themselves? we think of facebook as a social network which it is but they have all sorts of internal projects, for instance, its virtual reality project. lots of teams working on hardwares. it has something called portal which has been controversial, a new version of
that recently, a new screen in your home. i think whatever you think of the technology, it is facebook itself which is so controversial. let's talk about wework, fascinating what's happening with this company. the former ceo had hisjet what's happening with this company. the former ceo had his jet taken away from him. shock, horror! nota particularly good investment perhaps the softbank? what is extraordinary to me is how quickly this has unravelled. a few months ago, this was the $115 billion company that was supposedly the big hit of our time. i have never understood why it's a technology company. it basically does the same as a company called regis, which has changed its name. it is not sexy! it rents out offices, puts a tech layer on it by giving people free beer and a ping—pong table and saying, we have all these artificial intelligence about how you work and so on. it's a property company. and those can be very vulnerable when you come to a
downturn and there is concern about what will happen to it if the tide sort of goes out. depends what you think about the foresight of softbank, investing so heavily on this company which you say clearly doesn't do what it says on the tin. the guru behind softbank has been seen as an the guru behind softbank has been seen as an incredible man whose spotted things like uber and templer mcgrath now people are questioning hisjudgment mcgrath now people are questioning his judgment and question whether the funds will be forthcoming for his next big plans. he has lots more big plans. very significantly he owns in the uk one of our great technology companies, arm, so i think they will be concerned in the longer term that has table that will be. what do you make of peloton, this virtual but static bike? it's bloated, shares already down 11%? it's another example of one of these
companies that has achieved privately these huge valuations, an awful lot of buzz around it, no clear path to profit at the markets are getting much more cynical about them. they have seen uber and lyft when they are thinking, peloton, not social. i would prefer to get on a regular old bike, ithink! thank you. thanks very much, rory. in a moment, we look at the business pages that there is, a quick reminder of how to get in touch. london, singapore, shanghai, new york, your business well covered, on—air, online and on the bbc news app. check out bbc dot—com slash business for their insight and analysis. the bbc‘s business lives page has the latest breaking business news. we want your views as well. get in touch via our page,
tweet us or find us on facebook. join the bbc‘s business conversation. let's see what other stories are being talked about on social media. let's focus on what is happening in saudi arabia because it is relaxing not just the dress saudi arabia because it is relaxing notjust the dress code but also, importantly, visas for tourists. it wa nts to importantly, visas for tourists. it wants to open up the country, do you think it will be successful? it has to find other ways of earning money, oil doesn't seem popular at the moment in terms of their production was that what they have been trying to do with oil is trying to get the income now, because in 100 years' time they won't have the money. where else can they look? they had some pretty good beaches, a peninsula full of sand. some fascinating things to see, ruins and archaeology, all the things you see injordan archaeology, all the things you see in jordan over in archaeology, all the things you see injordan over in saudi which have been blocked to us completely. there
isa been blocked to us completely. there is a lot to do there. a real change of tack, isn't there, by the administration, the kingdom, to try and... a public relations exercise? very much a public relations exercise. we saw what happened before with yemen. it needs a lot more positive pr at the moment and it isn't getting it. thank you, justin. we have something else, victoria? we do. what you make of this story... this is a story that the bbc is also covering. the guardian article. babies on a plane, japan airlines has unveiled a tour to be able to identify where the babies are, where the under twos are ona plane, babies are, where the under twos are on a plane, so you can choose, i guess, to sit away from them. what you make of that, do you think it is a great idea? you are probably on and off planes all the time? nothing worse than sitting next to, no matter what age they are! what's
worse is being the parent of that child, that is worse. that is embarrassing, what else can i do? you can't gag them. it is only under twos and i would say bickering 12 and ten—year—olds are worse on a flight! then a baby. they may well go to sleep for the entire period. one thing i did see which was quite good as a glorified plastic bag... that some idea, but a baby ina plastic bag... that some idea, but a baby in a bag. quite a controlled environment that could sleep to its hearts content and not annoy eve ryo ne hearts content and not annoy everyone else. i do have to be well aware of what's going on just in case the poor thing had some troubles! yes, thank you for your tweets. if you are coming in. one saying, unfortunately you still have to sit next to our own children! another, i think it's a great idea and more airline should introduce this. watch this space, they may do. a lot of encouraging comments. thank you, justin, for coming in. that is all from us for now. i buy. have a lovely weekend, bye—bye.
hi, there. we've had a lot of rainfall over the last few days, more to come as we go through into the weekend. our through into the weekend. weather watchers have sending our weather watchers have been sending plenty of pictures into us. low pressure still in charge of the weather today. that will bring this little feature here towards the west, and enhancement of showers moving eastward. you can see from the satellite imagery, the massive cloud associated with that. further out in the atlantic, i want to draw your attention to this area of cloud. a developing area of low pressure which bring wet and windy weather over the weekend. for today, bands of showers move from west to east. they will be heavy at times.
stronger gusty winds, particular in southern areas of the uk. some sunshine coming through across wales, the west midlands, northern ireland and western scotland later on. maximum temperature is getting to 14-18 on. maximum temperature is getting to 14—18 celsius bust a blood pressure is still there as we start the weekend, still a few little features in the flow. these occlusions moving their way through. that will give an enhancement of showers on saturday across northern parts of the uk. some of those could be pretty heavy. later on, they tend to clear away. some drier and brighter weather for northern and eastern areas. towards the south—west, you can see behind me the next area of rain spreading in. temperatures on saturday 17—19dc. the rain in the south—west is linked to that area of low pressure i showed you at the start. there is some uncertainty as to how far north this might track. the current thinking is it will push north—eastward into southern parts of scotla nd north—eastward into southern parts of scotland through saturday night into sunday, accompanied by some strong winds, particularly around coastal areas and it means for
sunday, it will be quite a wet start to the day. that rain will gradually ease off towards the east. some showers coming in on a rather brisk north wind. quite gusty for many of us as we go north wind. quite gusty for many of us as we go through into the afternoon. there will be some sunshine across western areas, and maximum temperature 13—16 or 17 celsius. quite chilly throughout sunday. certainly over the weekend, we will see more rain in the forecast. a lot of areas have seen quite a bit of rainfall. so with more to come, there is the risk of some localised flooding and they could be some difficult driving conditions to come over the weekend as well. bye—bye for now.
you're watching bbc news at 9:00 with me annita mcveigh — the headlines. the prime minister's top adviser says it's "not surprising" some people are angry with mps over brexit. former vote leave chief dominic cummings was confronted by a labour mp. it comes as more than 100 of the church of england's bishops and archbishops issue a rebuke to politicians for using what they call "unacceptable" language in the fierce debate over brexit. also, coming up — mps say some medicines could run out in the event of a no—deal brexit. i'll be talking to the head of a government agency that's warning of a shortage of health supplies. that's at 9:15am.