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tv   BBC Business Live  BBC News  July 24, 2019 8:30am-9:01am BST

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this is business live from bbc news. i'm sally bundock in downing street. braced for boris — later today mrjohnson will officially become britain's next prime minister. i'm ben thompson, live in london, and that's our top story on wednesday 24th july. borisjohnson will begin forming his new government later after he succeeding theresa may as prime minister. he'll take office this afternoon after meeting with the queen at buckingham palace.
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all eyes will be on who mrjohnson chooses for key roles, including chancellor, and home secretary. but what does the johnson government mean for brexit, trade and the economy? we'll get an expert view from london, and from brussels. hello and welcome to business live. i have to say is getting warm here right now in downing street. as you can see, it's really busy here right now as well. a lot of media have gathered because later on today the country is newly elected leader of the conservative party borisjohnson will enter the door, number ten, behind me as the uk's next prime minister. brexit is the biggest
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issue that he faces, the biggest challenge as a new leader. throughout the contest of course, for the job, throughout the contest of course, for thejob, he made a series of key pledges about leaving the european union. so what can we expect? mrjohnson has vowed to leave the eu by the 31st october deadline "come what may". he claims that the chance of a no—deal brexit is a "million to one". he wants to negotiate a new deal, including replacing the irish backstop, designed to avoid a hard border between northern ireland and the irish republic. mrjohnson says the backstop could be replaced with so called "alternative arrangements" including a technologicial solution to avoid physical customs checks for lorries crossing the border. he says he won't hand over the $48 billion or £39 billion divorce settlement with the eu until the uk gets a new deal. if a new deal is not agreed, he will ask the eu for a "standstill
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period" to negotiate a free trade deal. mrjohnson has argued that a provision under the general agreement on tariffs and trade, known as gatt 2a, could be used for the uk to avoid tariffs for the next ten years, but he's admitted it would still need sign off from the eu. our assistant political editor norman smith is here. norman, here we are, borisjohnson will walk through that dough this afternoon as our will walk through that dough this afternoon as oui’ new will walk through that dough this afternoon as our new prime minister. —— door. it's got to appoint a team first, i guess, —— door. it's got to appoint a team first, iguess, is —— door. it's got to appoint a team first, i guess, is that his first job? yes, we are getting bits and pieces about the type of team he wants to put together. it's going to bea wants to put together. it's going to be a big change from the sorts of current crop because i think mr johnson's view is that mrs may's team, frankly, ran out of puff, were
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exhausted, just became politically paralysed from doing anything. we talked yesterday about energising the country. he wants to energise the country. he wants to energise the government ability new, younger faces, more diversity, to reflect modern britain. i think also to counter the idea that brexit is a looking backwards, turning inwards toa looking backwards, turning inwards to a post—imperial dad's army britain. he wants to have a confident outward looking energetic cabinet but crucial to war that is going to be the balance. obviously there will be a big influx of brexiteers, but it is a delicate balancing act is got to perform because the parliamentary party is profoundly divided and if he just surrounds himself with true believing brexiteers, and that is going to reinforce the doubts of the parliamentary party and will bolster the ranks of those of us who are waiting and watching to see if he flounders and then potentially move against him. what are you sharing about who might move into this house
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next door, number 11? about who might move into this house next door, number11? well, the frontrunner i guess is sajid javid. he came out for borisjohnson, he has experience in the treasury. he would seem a natural fit. the difficulty is, of course, mrjohnson has a whole load of people who might equally think i'm a natural fit too. liz truss, another very loud and vocal backer of boris johnson. a woman. maybe she would be a more natural fit. matt hancock too, former chief of staff with george osborne, also with treasury experience who feels he was out there pretty early doors banging the drum for boris johnson, there pretty early doors banging the drum for borisjohnson, so there is a whole group of people who could get it. if i had to put money on it i would suggest it will probably go do sajid javid. all right, norman, thank you very much indeed for your thoughts on that. and the inside track. that is the chancellor of the exchequer. for those viewers around
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the world who might not be au fait with all of that, i'm going to hand you now back to ben. sally, thank you. we'll be right back with sally later. with me now is edwin morgan, interim director general of the institute of directors. welcome to business life. the study looking at the procedural stuff and we get those appointments later and lets look at where we are now in terms of business and the economy. what does business want from mr johnson? there are two things. brexit and business once a deal, that's pretty clear, and on the other hand, the domestic policy areas. i think that's where mrjohnson has said he wa nts to that's where mrjohnson has said he wants to be very pro—business, he wa nts to wants to be very pro—business, he wants to boost business in the short term, so the things we think won't help are things like brexit planning vouchers, for small businesses, schemes that run in ireland, the netherlands, two or £3000 to help small businesses prepare. what would they spend that on? advice and
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consultancy would be the big thing. a lot of members say they don't know how to prepare for brexit whatever form it takes because they don't know what their exposure is, they don't know what the practical implications would be, so most of oui’ implications would be, so most of our members feel they have done about as much as they can, small members in particular, but they are not fully prepared. we are talking about someone going into medium—sized or small firms and saying you need to change your legal requirements, your labelling, your paperwork, is not what it comes down to? yes, basic things like that. imagine if you are a small business owner, focusing on business as usual, running the company day to day, and you don't either have the expertise on all of the customs, the tariffs, or you don't have a time and the personnel to deal with all of these things, so the most basic level for small firms that a good help. boris johnson yesterday talking in a speech about re—energising britain and he says it's the idea he's got to unite it
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and energise it. how do you do that because there's been so much division and anger through this referendum process and the brexit negotiations. i wonder where he even sta rts negotiations. i wonder where he even starts to do that? things to help business in the short term and give them more energy things like business rates, they have badly affected small companies across the country. you could raise the threshold to help out small and medium—sized firms. skills are a huge thing which you routinely come out as one of our top three issues for members. you can inject more money into apprenticeships which are currently running out of money. the government schemes. or expand these schemes to broader training. there's lots of things you could do in that space. encouraging investment in new companies would be great, as well. we are advising the enterprise scheme, more money into that, maybe
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regional schemes around to encourage investment in the north—west, those kinds of things. but on a wide level, really getting behind the agenda driving growth outside london and the south—east. there are lots of things you can do there around business support, infrastructure is a massive one, in the north of england in particular. there's lots of things the government can do and speeding them up would really help. big questions over where the money comes from. edwin, it's very good to see you. the interim director of the institute of directors. let's take a look at some of the other stories making the news. chinese e—commerce giant alibaba has opened its doors to us sellers on its oldest platform, alibaba.com. it now offers tools to allow us firms to sell on the business—to—business platform in the us and around the world. the move will allow alibaba, traditionally china—focused, to compete with global e—commerce giants like amazon. the white house has signalled that face—to—face trade negotiations with china are set to restart.
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donald trump's economic adviser larry kudlow welcomed a report that trade representative robert lighthizer is scheduled to travel to shanghai. mr lighthizer‘s office has yet to comment on the report. the us has announced an investigation into leading online platforms, examining whether they are unfairly restricting competition. the justice department didn't name any companies, but facebook, google, amazon and apple are likely to be scrutinised in the wide—ranging probe. it marks the latest scrutiny of the tech giants' power over the american economy. the international monetary fund has cut its growth forecasts for the global economy for this year and next. it predicts growth of 3.2% in 2019, and 3.5 % in 2020. the organisation said growth "remains subdued" and there is an urgent need to reduce trade and technology tensions.
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reports say that nissan plans to expand job cuts to over 10,000 to help turn around its business. that would include the 4,800 job cuts it announced in may. let's go to our asia business hub where shara njit leyl is following the story. lovely to see you. so what is nissan likely to be doing? what are the report saying? well, that's right, sally, you say these 10,000 jobs potentially cut, all based off media reports citing unnamed sources. nissan's spokesman has told the bbc the company does not comment on such speculation but we know that these potential cuts come after the car—maker announced those a800 job cuts you mentioned in may which essentially had projects in the us, mexico and europe. these possible new cuts are expected to hit factories mainly outside japan new cuts are expected to hit factories mainly outsidejapan as
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well according to those same sources. these reports of course are increasing fears ofjob losses at nissan's uk operations in sunderland. 7000 workers there are already facing huge uncertainty due to brexit and the japanese car—maker mac apostasy is not to build the new model in england. we know nissan has had a series of challenges this year. falling sales in the usa and europe, dealing with the arrest of former boss, financial misconduct charges, and tensions with renault which owns a stake in it. the car—maker is due to reported quarterly earnings on thursday, so we shall all know a bit more about potential cuts. thank you for staying right across that story from us. staying right across that story from us. more details on that later. let me say what the markets are doing at this point of the morning. european and us stocks saw a decent session yesterday, and asia following that lead overnight. that was partly driven by a downgrade of global growth expectations by the imf,
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but why does that boost markets? well, it suggests there may be further measures from central banks to prop up growth. and that's good news for equities. earnings season is also well under way and a good set of figures from banking and tech came in, on the whole better than expected. and there's also hope, as we've said, that us, china trade talks could restart next week. a welcome relief for nervous investors there. the pound slipped against the us dollar but performed much better elsewhere, that's helped confound expectations of further losses after borisjohnson was confirmed as new conservative party leader. but closer attention will be paid to what sort of cabinet he assembles. joining us is emma—lou montgomery, associate director for personal investing at fidelity international. nice to see you. welcome to the
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programme. let's delve straight in because the tension will be on that cabinet and what sort of shape that sta rts cabinet and what sort of shape that starts to take later. let's touch on stirling because yesterday a torrid day as investors worried about what the cabinet will look like and also what the brexit negotiations will look like. sterling has had a tricky time since brexit was announced and especially in the last period. looking for signals all the time as to whether we are going to get this no—deal brexit which of course is a worry and that tends to send the pound lower. over the month, we are down about 2% overall so it still looking weak and really i think in terms of october 31, until it's done and dusted, we are not going to have no certainty in the pound and we don't know what to do to look for clues. we talk about the weakness of the pound a lot. it is the clearest barometer of sentiment about brexit but the ftse 100 barometer of sentiment about brexit but the ftse100 has done really well this year. partly because of the international flavour of that, but also the uk economy has fared in
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an ok manner, hasn't it, given the uncertainty we discussed daily?m certainly has an if people are tempted to turn their backs on the uk market they might be missing a trick because not only is the dollar good for exporters and companies who trade overseas a lot, but people are not thinking the uk is worth looking at the moment which means as contrary investors will tell you this opportunity is to be had. this could be one of the best times in history potentially to actually be investing in the uk. quickly, let's turn our attention to the china us tory potential trade talks beginning again after that deadlock for so long. that could be very good news in terms of unlocking some potential caught up in those trade rows. it's another set of worries, isn't it, as which way it's going to go? hopefully there will be positive news coming out of this but markets are cautious, sterling and everything else in the stock market, they are looking for any signals they are looking for any signals they can get as to where they can
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find positivity and positive news, so it's another case of yes, fingers crossed and hoping it turns out well in the end. that's often how things are done. very good to see you. thank you. still to come. talking to those in brussels about what is happening here in downing street today. what is the reaction from european business leaders? we will be live there later in the programme. stay tuned with that. you're with business live from bbc news. as boris johnson prepares to officially become pm later today, he'll have just 100 days to prove he is as good as his word to deliver brexit by october 31st with or without a deal with the eu. steph mcgovern has been speaking to business owners in manchester city centre this morning to gauge their reaction to the new pm.
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hello from this rooftop in manchester city centre. you can see behind me the town hall in all of its glory but we are talking about what businesses think about our new prime minister boris johnson. matthew is the chief executive of the hacker group, a business which manufactures, and exported over the world, so what are your thoughts never anything going on at the minute? are you optimistic now we got borisjohnson as prime minister? having a change, you've got to be optimistic about change otherwise you don't make the most of it. equally, it's quite concerning in terms of brexit upcoming and what impact that will have, so i think it's a combination of the two. what could the prime minister due to settle your mind at the moment to help your business?” settle your mind at the moment to help your business? i think give some form clear guidance around what happens in a no brexit scenario.
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just pushing a no brexit situation on its own is not helpful to anybody. businesses are used to dealing with uncertainty, so for you asa dealing with uncertainty, so for you as a business leader, is this just another thing you have to deal with and are you still cracking on as it were? yes, look, they are uncertain times, we do need to get on with it, we are recruiting lots of staff, another 1500 this year. we are making very large investments. we are doing that in the face of uncertain times. i don't think there's any other option. i think there's any other option. i think the alternative is a very competitive market and will suffer otherwise. thank you very much for your time. that's it from me here in manchester. staff there gauging the reaction from businesses in the north west. let's go to the business live page. in case you thought you were going to get your evening back, think again. itv has announced that a love island, the hugely popular series which runs on its itv has announced that a love island, the hugely popular series which runs on its itv2 channel will now have two series a yearfrom itv2 channel will now have two series a year from next year. it's
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not without controversy, of course. some are calling for the service to be cancelled after the death of two former contestants, but it's a lucrative moneyspinner for the network. love island say they will do two series, one in south africa, and the other in the mediterranean. you're watching business live. our top story. braced for boris. later this afternoon, mrjohnson will officially become britain's next prime minister. and we will begin forming his government after he succeeds theresa may as prime minister. let's show you what the markets are making of that in early trade. the ftse100 lower by a quarter of 1%. but keep an eye on the pound. falling yesterday. but then regaining some ground. remember, a lot of that has been priced already, no huge surprise
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borisjohnson won the leadership election. but we will start getting an indication of which way his cabinet will take the negotiations when he appoints the seniorjobs over the course of today. sally has been telling us he will go to buckingham palace to meet with a cream and then begin the process of assembling his top team. —— to meet with the queen. so what's the reaction in the rest of europe been to borisjohnson becoming the new uk's next prime minister? ben butters, deputy chief executive at eurochambres joins me now from brussels. this organisation represents over 20 million businesses across europe. so what are your members saying to you about this? well, it was interesting to hear from the business about this? well, it was interesting to hearfrom the business in manchester a few moments ago because our reaction is quite similar. this is what we are hearing from our members across europe. relieved and
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pleased a new prime minister is in place, and therefore the process will move forward. because we are two thirds of the way into the extended transition period now and there has been basically no progress so far. but, at the same time, as the gentleman from manchester mentioned, the threat of no deal is one which concerns our businesses greatly. and are they preparing for that? do they see that as a very likely scenario now that we have borisjohnson as prime minister, who has said we will leave do or die on 31st october? well, certainly that rhetoric worries the eu 27 business community. they have been preparing for no dealfor some months, even before the transition period was extended back in march. but, yes, the messages during electoral campaigns, exacerbated those
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concerns, our hope is of course that the prime minister will now move on from slogans during his electoral campaign to actually a sensible and pragmatic progress in opening discussions with the eu negotiators again and that will lead to a negotiated outcome rather than a no deal scenario. it would be hugely damaging to the uk economy and certainly would not do any favours to the broader european economy either. from your perspective, who needs to move most? we are getting tough talk from boris johnson. needs to move most? we are getting tough talk from borisjohnson. we've yet to know who his team is that they will be appointed in the next few days but also brussels is staying for a man saying that actually there isn't very much wriggle room on the deal that theresa may brokered. so, from your perspective, how will we see progress? yes, it is tough to predict that. as you say, the eu negotiators are very firmly saying
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that the withdrawal agreement cannot be reopened. there is scope to look out the political declaration on future relations again and that would seem to be the only place, the only opportunity to come to some kind of compromise. the biggest thing is the backstop for the uk but it has much broader implications for the single market, the integrity of it, which really is a cornerstone of the eu project. so we are really concerned that a sensible solution that deals with the border on the island of ireland, but also that secures the integrity of the single market. we really hope that can be arranged before the 31st of october. 0k, arranged before the 31st of october. ok, thank you. deputy ceo of euro chambers. there are some other stories away from downing street. it's a busy business day. us car giant ford will announce its latest earnings later,
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after showing a strong first—quarter on growing demand for its pick—up trucks and suvs. bbc business correspondent michelle fleury has more. ten double—decker cars weighing over £1 million. being towed by a truck. you've got to be kidding me? but this is no regular pick—up. it's electric f 150, this is no regular pick—up. it's electric f150, the goal to convince customers that switching away from the combustion engine isn't a downgrade. electrification rethink is an important trend. we want to be prepared for it and create future. ford is spending $11.5 billion to electrify its product line—up by 2023. but our customers are ready to make the switch? most drivers still buy conventional gas cars.|j make the switch? most drivers still buy conventional gas cars. i don't have a crystal ball. a lot of things will dry that acceptance, our strategy is to do it by embracing
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and playing to our strengths, so going into segments where we dominate and electrifying our most iconic nameplates to give us the pricing power as well as the market dominance. gimmicks to promote electric vehicles aren't new. remember this? a tesla model x pulling a boeing 787 dreamliner plane. ford mag must electric truck is hauling three times that load. still there is no timeline for the electric f1 52 hit showroom floors. a staple of american farms on construction sites, car—makers know that truck is beloved in america. changing drivers hearts and minds will be key to realising a future thatis will be key to realising a future that is electric. michelle fairey, bbc news. so a busy days on both sides of the atlantic. has theresa may brought you a cup of tea yet, sally? no. no cup of tea from
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theresa may or philip hammond next door. we will see you very soon. good morning. how did you sleep last night? the heat and humidity brought some pretty intense storms through the night. they started in the south—west, they tracked their way north and eastwards, and this morning we had about 3a,000 lightning strikes across the uk. and that comes after what was a pretty hot day. in jersey we recorded the highestjuly temperature on record, 36 degrees. over the next few days, the heat is going to continue. slightly fresher today but the heat builds again for thursday. so this morning, still quite a lot of rain across northern parts of the uk. some thunderstorms will track their way to the north and east. it will become drier for scotland and northern ireland with one or two showers here. maybe some cloud across western areas but most of us a sunny afternoon.
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maximum temperatures down a little bit by a few degrees or so but still 32 degrees in the south—east. through tonight, still a few showers. and, northern ireland, mostly clearing out and then we look at clear skies into thursday morning. not quite as warm and sticky as last night but those temperatures still holding up at about 13—17. into thursday and thursday it's about the heat. it's going to build even further. low pressure to the west, high pressure to the east. the air is coming all the way in from the south, so very hot air at the moment across france, the low countries, that's going to spread its way back in across the united kingdom, especially in eastern areas. during thursday there could be a few showers along western part of the irish sea coast. a few thunderstorms here, but the most of us, a sunny day on thursday. those temperatures widely coming up into the 30s. but it's down to the south—east of england where we are expecting temperatures to be about 37 celsius. now that would break the current july record for the uk,
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beating 36.7 celsius, and there's a chance we could get close to the all—time record, which is 38.5 celsius. we will keep a close eye on that one. into friday, this cold front toward the west will gradually move its way east and that slowly to introduce and pressure conditions, so if the heat isn't your thing friday we'll see the temperatures dropping down to about 21—25, maybe 27 in the south—east of england, but over the weekend it's going to feel much cooler. there could be some heavy rain around especially in northern and eastern areas. that's all for me. have a good day. goodbye.
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this is bbc news. i'm annita mcveigh, live from downing street, on the day that borisjohnson becomes the uk's prime minister. has it sunk in yet? well, getting there. last night he celebrated victory in the conservative leadership contest with party members. today, he'll enter the doors of number ten to lead the country. mrjohnson will meet the queen at buckingham palace to get formal permission to form a government. before that, theresa may will also be at the palace to offer her resignation to her majesty — shortly after her final prime minister's questions. the attention will then move to the cabinet re—shuffle.

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