Hurricane Melissa hits Jamaica, its most powerful on record.
The plan is we will enter the inner room, barricade ourselves in there.
Farms are all devastated.
The crops will be wiped out.
So we're going to have shortages.
Welcome to World Business Report from the BBC World Service.
I'm Sam Fenwick.
Flights have been grounded, holiday resorts emptied and coastal businesses battered.
It's a major blow to Jamaica's tourism-driven economy at the height of the travel season.
And in Japan, as Donald Trump continues his Asia tour, new deals have been done to secure the critical minerals that power modern technology.
So Hurricane Melissa has made landfall in Jamaica with winds close to 300 kilometres an hour.
It's one of the most powerful storms ever recorded in the Atlantic.
Authorities are warning of catastrophic flooding and the US National Hurricane Centre says the now Category 4 storm is extremely dangerous and life-threatening.
Hurricane Melissa came on shore about 75 miles west of where we are, but it is taking hours to cross this island.
Incredibly strong winds heavy, heavy rain and now, not surprisingly, flooding also a very big concern.
Hurricane Melissa slammed into Jamaica with winds up to 185 miles per hour and heavy rains.
Dean Jones builds and sells properties on the island's north coast for a company called Jamaica Homes.
I spoke to him just 10 minutes after Melissa struck.
Jamaica's western coast been very, very turbulent.
Up here in where i am on the border of saint anne's and saint mary, the eye is not going to come over where we are, but we're going to get the right hand side of the storm that will hit us from the front and we'll get most of the backlash as it leaves Jamaica.
So will you have to evacuate?
We've packed everything up.
We've brought things in from the garden.
Downstairs within the house, we've put things into barrels and put that on the lower level.
So on the ground floor we've got a concrete slab above and then the next level, which is, of course, a timber roof.
So we're down on the lower level.
And we put that with all the stuff in the inner room.
And so the plan is that we will enter the inner room, barricade ourselves in there and stay within that room until it's over.
As a realtor on the island of Jamaica and someone that builds homes, there are already signs, aren't there, of major damage to homes, hotels and infrastructure.
Can you describe some of it that you've seen?
I've not seen any roofs peeling off yet.
What I have seen is trees falling.
What sort of damage do you think it could do?
If you're in the immediate ring, your roof will unfortunately peel off.
You know, if it's a timber roof, unless if it's a slab roof, you might be OK if it's reinforced and the steelwork is being joined with the walls and that runs continuously around the building.
There's a lot of disbelief here about a storm actually hitting.
And I mean, my parents are here and I'm worried.
I can't get through to my in-laws.
They're in the path.
They would have been hit before me.
There's just zero communication.
Power went last night.
Trees are down.
And that started two days ago.
So you can't speak to any of your relatives that are in different parts of the island?
They're just not answering.
Some of them are just not answering.
I don't know why.
It could be the network is going down where they are.
It could be that they just haven't got any more power on their devices.
When you look back at Hurricane Gilbert, which was in 1988, it did sort of force a rethink of building standards.
If you then compare that to the damage from Beryl last year...
Have people started to look more closely at the way that they build their buildings?
Building standards has come a long way since then.
I was a child and I visited.
I was here just after the aftermath of Gilbert and it was just complete devastation as a child.
Houses are being built with blocks, steel work, you know, cement, much more solid.
Unfortunately, not everybody uses hurricane straps and we're warned to do that.
So you find many properties without that.
And that is a crucial thing in a building without those straps.
You know, at Galeforce, we're at 145 to 170.
The wind, the suction, I mean, that thing can be peeled off.
How well insured are homes and businesses that you work with?
Most business owners do have insurance, most, maybe half, maybe.
That's a guesstimation.
But unfortunately for my customers, normal residential house owners, Most of them don't insure.
Insurance is very expensive out here in Jamaica and I guess the rest of the Caribbean.
It is painfully expensive.
I mean, I would go as far as to saying 10 times more expensive than the UK, if not more, per month.
And so if you're on a pension and bearing in mind there's a lot of returning residents, you can't afford to pay insurance.
Dean, you were saying that your family are in different parts of the island.
Have you been able to contact them?
Do you know if they're safe?
My mum's safe at the moment.
I don't know of anybody else right now.
In all honesty, I have limited power and batteries, really, so I can't continue phoning everybody.
People I have phoned that I've not been able to get through to.
They're the ones on the side where Treasure Beach and you know that side of Jamaica.
Well, listen, thank you very much for talking to us.
I'm conscious that we've taken up a lot of your time and we're using your precious battery and precious data services.
So please stay safe and send our love to your family, won't you?
Yeah, definitely.
I mean, I keep people updated on my website, Jamaica Homes, as well, as best as I can.
I'm anxious while I'm doing it.
I'm anxious while I'm watching the news.
But I've been trying to do that.
That was Dean Jones speaking to me a little earlier on.
While Jamaica is no stranger to the economic cost of extreme weather, an International Monetary Fund report found that two hurricanes in the early 2000 caused losses of around 8 and 3 of GDP.
So what might be the economic damage of this storm?
Milton Walker is head of news at the Jamaica Gleaner in the capital, Kingston.
It's St Elizabeth, which is the parish where the storm made landfall.
That's our bread basket.
That's where most of our fruits, the cash crops, the carrots, cabbage, lettuce, cucumbers.
Central Elizabeth produces a lot of that for Jamaica.
And with Central Elizabeth being devastated, I'm pretty sure the farms are all devastated.
The crops will be wiped out.
And so we're going to have shortages.
There will be some food inflation as a result as well. because of the storm.
And we're not likely to be reopened until perhaps Thursday.
The airports are closed, so no tourists are coming in.
I think we've got 25,000 tourists on the island.
Both international airports are closed.
The one in Kingston closed Saturday night.
Montego Bay, which is by far the larger one, that closed on Sunday midday.
So all that economic activity is at a standstill.
You can see the losses yourself on the food prices in the breadbasket area, where all the food is produced.
I suppose it'd be difficult right now to say what the impact to infrastructure might be.
The power company's office in Black River, which is in the capital of St.
Elizabeth, it's just damaged, almost destroyed.
You're looking inside and you're seeing the sky.
And the furniture and everything it's just been, you know, like a breaking ball, went into that building.
The Black River Hospital is damaged.
The Sablamar Hospital is damaged.
Sablamar is in Westmoreland.
Black River Hospital is in St Elizabeth.
Those are critical pieces of our healthcare sector that will have to be rebuilt.
We have a lot of our hospitals.
There are about seven of them that are built on the coast.
You know, when we were a British colony, a lot of hospitals were built on the coast because back then we weren't getting hurricanes.
And you know, I guess it was felt building by the sea will help recover its.
You know people be healthy, soothed by the wonderful, calm Caribbean Sea.
But the sea is now a menace.
And we are going to have to look hard as a society, as a country, whether or not we're going to have to move those key pieces of our health infrastructure inland, off the coast.
And that will be a considerable expense, capital expense for the government as well.
Let's talk about tourism.
You mentioned that all the airports are closed, obviously.
There are tourists on the island.
But tourists who were perhaps due to arrive on the island won't be able to for quite some days at least.
Exactly, exactly.
We would have been getting tourists every day.
There would be cruise ships docking as well at our four ports.
And none of that has happened since last week, Wednesday.
So we're all of that economic activity that would generate revenue for the country is gone.
King is going to come up through St.
Elizabeth, through Trelawney and St.
James.
And both of those are consequences. heavily tourist carriages.
Montego Bay is in St.
James.
And so lots of hotels are in that corridor.
So they're going to be impacted and maybe some damage to hotels as well.
So again, that's going to have a.
Do you find that in the aftermath of a hurricane, that actually tourists are less likely to book because it's been in the news and people might be scared?
I suspect there might be some of that that will take place.
The tourism ministry does undertake a marketing campaign in the key markets, which would be the United States, Canada and Britain.
And of course, The winter tourist season is just what starts December 15.
So hopefully we'll be able to get ready in some way for that peak period, because that's when tourism really earns.
Milton, are you safe?
I am safe.
I'm in the capital.
I'm at the station.
Our building is very, very safe.
Our roof is reinforced concrete and we've got shutters on all our windows, so our building is pretty safe here.
That was Milton Walker.
He's head of news at the Jamaica Gleaner.
And you can follow the latest on Hurricane Melissa on BBC.com.
Milton Walker, the head of news at the Jamaica Gleaner.
And you can follow the latest on Hurricane Melissa on bbc.com.
This is World Business Report from the BBC World Service.
Now, a helicopter landing on the deck of a US aircraft carrier isn't the usual setting for an economic discussion, but that's how Donald Trump and Japan's new Prime Minister, Sanaya Tahichi, arrived during a day of praise, gifts and promises of huge new Japanese investments in the United States.
And not only that, there was also a deal to boost supplies of critical minerals and rare earths.
Their stock market today and our stock market today hit an all-time high.
That means we're doing something right.
But the cherished alliance between the United States and Japan is one of the most remarkable relationships in the entire world.
Really, there's never been anything like it.
Born out of the ashes, of a terrible war.
Our bond has grown over eight decades into the beautiful friendship that we have.
Well, both leaders hailed it as the start of a new golden age in US-Japan relations.
Let's talk now to Nabuka Kobayashi.
She works for the consulting firm EY in Japan.
She's been following the day's events between the US and the Japan meeting what it means for trade, investment and supply chains.
Nabuko, thanks for joining us.
What do you think then?
Is it a new golden age?
Well, the proof is in the pudding, so we have to see how it develops.
But for a start, I think Takayuchi-san, as newly minted PM of Japan, successfully staged a warm report with President Trump.
So that was the most striking thing out of this summit.
Talk to us about some of the deals that were done.
So there were investment pledges, there was this minerals deals.
What else?
What's the most important thing do you think that's come out of it for Japan?
They confirmed the implementation of the previously agreed trade agreement.
So this is not something new, but they confirmed it.
And the rare earth mineral supply chain.
That is a long-term project that Japan pledges to support US and it's a framework agreement.
What does this word framework mean?
We've heard about it a lot.
There's been a framework agreement with Vietnam and now there's a framework agreement on minerals with Japan.
Does it mean that something's actually going to happen?
Yes, it would mean that Japan and other countries would collaborate with the US to establish a independent supply chain of rare earth minerals from China, because China now has the virtual monopoly on the critical rare earth mineral, from procurement to processing.
Does Japan have a lot of minerals, or is it that they're going to procure them from China and kind of send them off into the US via that direction?
No, Japan is not a natural resource rich country.
However, procurement and processing of rare earth minerals demands a lot of technology and investment into the processing facility and technicality as well.
So those are the areas where Japan can support.
Who do you think's done the better out of this deal?
Is it the US with their promises of big investment?
Or is it Japan?
I would have to say both because whatever benefits US would benefit Japan as an alliance partner.
And how do you think business will react and how do you think investors will react?
What will the markets do this morning when you wake up?
The U.S. continues to be one of the most important markets for Japanese businesses.
Therefore, these 84 trillion yen pledge of investment into the U.S. can be good news for Japan.
Just talk to me for a moment before we finish our conversation about cars.
So exporting of your Japanese cars is very important.
The US is an important market.
Has there been any resolution on that?
Well, the tariff on automobiles have been on a volatile journey.
So it has been raised to 27.5%.
But since mid-September, it has been lowered to 15%.
So it's a little bit of a reprieve.
But compared to the historical...
Of course, it's higher.
So Japanese automakers are having to either absorb the cost or have to put it on the consumer price that the US consumers have to bear.
So it's still in a tricky position.
That's still one to be negotiated, perhaps.
Well, thank you very much for joining us today on the programme.
Kobayashi joining us there from Tokyo.
She is one of their experts on the Asia markets for PY.
Well, the next stop on the Asia tour is South Korea, where Donald Trump is expected to meet China's President Xi Jinping later in the week.
Our correspondent Laura Bicker is in South Korea.
The chants of No Trump grew louder as protesters neared the US embassy in the centre of Seoul.
A stage and a loudspeaker ensured their voices would soar above Gwanghwamun Square.
22-year-old college student, Kim Sol-yi, was helping to carry a banner depicting a cartoon Donald Trump vomiting money.
When Donald Trump called Korea a money machine, that really angered me.
It seems like the US is seeing and treating Korea as its cash cow, plain and simple asking for those huge investments.
Just up the street is a rival demonstration.
This time the target is the other superpower, China.
Anti-Chinese sentiment here has grown in the last decade and more recently since the president granted Chinese tourists visas.
This 27-year-old didn't want to give her name.
We're against the socialist system embodied by the Communist Party.
We value democratic freedom and the free market economy.
We want a Republic of Korea where all freedoms freedom of association assembly religion, expression are all protected.
That's why we stand here.
This is Hongdae, a real young people's area, where you've got several buskers coming to show off their skills.
We've got three young women in front of me, K-pop dancing.
Round the corner, you've got people queued up for K-beauty.
This country has become a soft power, juggernaut.
Now, as President Xi and President Trump arrive, can this country's president play geopolitical hardball?
John Delury is from the Asia Society.
South Korea has a huge amount on the line in terms of their prosperity and their security.
But in a funny way, the last time Donald Trump is here could be better for President Lee Jae-myung.
It doesn't look like they're near a breakthrough on their trade agreement.
There are all kinds of topics that Trump could bring up that would cause incredible awkwardness, including US military presence on the peninsula.
There's a whole list of things.
And so, in a certain way, if Trump comes, has his meetings, they go well and he's out of here in 24 hours.
That's not a terrible outcome as far as South Korea is concerned.
So we've driven about an hour and a half northwest of Seoul.
We're at Aguibon Peace Park.
And right across the water, we can see one of North Korea's propaganda villages.
They've got tiny little white houses.
You've got a couple of people cycling, others working in the fields.
And behind... you can see the rugged mountaintops of North Korea.
The big question mark hanging over this week is will Kim Jong-un meet with Donald Trump?
Now, there's not much to lose for either leader.
For Kim Jong-un, it gives him yet another place on the world stage.
For Donald Trump.
The White House might believe that yes, it will just be a photo op and a handshake, but it might lead to more talks between Pyongyang and Washington.
But US officials have made it clear that their priority this week is to sit down with Xi Jinping.
Which Donald Trump reiterated during his visit to Japan.
I'll be meeting with President Xi the day after tomorrow.
I'd be surprised if anybody didn't hear.
That's a big meeting, and I think it's going to work out very well, actually.
I think it's going to be great for everybody.
Xi and Trump are bringing drama to a summit the world often overlooks.
South Korea's role is to play the gracious host, while trying to do some fancy footwork to best position itself between Beijing and Washington.
That was Laura Bicker reporting for us from South Korea.
Well, let's talk to Walter Todd now.
He's president of Greenwood Capital in South Carolina.
Walter, we've heard a lot about what the US might get out of this conversation between President Trump and President Xi.
We heard over the weekend Scott Besant talking on American media, talking about a very substantial framework being agreed, key components including the avoidance of 100 US tariffs on Chinese goods and the postponement of planned Chinese export controls on rare earths.
What do you think China is going to want to get out of it?
How do you think they're going to play their cards?
Well, good evening from the US.
Thanks for having me.
Yeah, I think you know, both sides have some leverage here.
Obviously the U S you know, is the largest export market or one of the largest for China.
So they want access to our market without you know a hundred percent tariffs, or something quite a bit less than that.
And, of course, they've played the card of the rare earth, uh minerals and metals, and restricting those.
I mean, remember, two weeks ago, this meeting was not going to happen.
It had been canceled by Trump and the S&P promptly dropped 3% in one day.
So I think there's a lot riding on the meeting for sure.
But I think what Besson's kind of game plan was this weekend was just to kind of steady the ground before the actual meeting and, kind of you know, lay a framework out there that you know would try to have success come out of this meeting.
But you know definitely the market with the all time high another all time high hit today is expecting good things out of out of the out of the meeting.
So the markets and investors are expecting the meeting to go ahead.
Yeah.
I mean, they're not only the expecting to go ahead, they're expecting, you know, a positive outcome.
What you know.
It's hard to define exactly what that is, but I guess what I would say is that China's buying US soybeans.
They're shipping rare earths to the US and not restricting those, and the tariff rate is quite a bit less than 100.
That would I guess, deemed to be positive results from the meeting.
So happy days.
Back to 2024 kind of vibe or not quite as good as that?
Well, I mean, based on Trump's meeting with the prime minister in Japan, he seems to be in a pretty good mood.
We'll see if that continues as he continues the tour of Asia.
But yeah, I mean, again, I think the market's discounting a lot of good news.
So anything that's a little bit different than expectations could be a headwind for the market in the short term, but we'll see.
Well, you mentioned the markets and how happy they seem to be feeling.
A lot of that is down to AI, isn't it?
Artificial intelligence.
OpenAI today has completed a major restructuring that converts it into a more conventional kind of for-profit group.
Explain what's happened there and what it could mean.
Yeah, so OpenAI was founded as a not-for-profit company and then they just saw how much money they could potentially make and change their minds here.
So what happened today is Microsoft indicated they're taking a 27 share as a result of this flip to a for-profit.
They'll get 20% of the revenues, I believe, from OpenAI.
But it values OpenAI at $500 billion.
And the interesting thing to me about being a for-profit company is you actually have to make a profit, which they haven't done yet.
They have 13 billion in revenues roughly this year.
That's the estimate, and they're valued at 500 billion.
So there's a bit of a disconnect there.
They've also made commitments for over a trillion dollars in expenditures over the next decade, and they've yet to turn their first dollar profit.
You sound skeptical then about... Call me skeptical in the short term.
I think there's a lot of good news in the market overall.
A lot of that related to AI, as you said, with NVIDIA, for example, hitting an all-time high today as well.
And PayPal, so PayPal have done a deal with OpenAI to become the first payment system in chat GPT.
So I suppose that's another way that they're going to try and monetize things.
Yeah, I mean they're making seem to be making deals on a daily basis with a variety of different companies, companies in a variety of different industries.
PayPal is the latest one to be the first, I guess, wallet approved on chat GPT.
That was good for about 12% move in PayPal initially, but it closed up 3%.
So a little bit of that came out of the stock as they reported earnings, etc.
So We'll see.
I mean, you know, OpenAI is continuing to make these deals.
They're longer term deals over, you know, five and 10 year periods.
Because they can't pay for it today because they don't have any profits.
Walter, thank you very much for joining us today on the program.
That's all we have time for.
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