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Hello, I'm Robin Ince.
And I'm Brian Cox. And we would like to tell you about the new series of The Infinite Monkey Cage.
We're going to have a planet off.
Jupiter versus Saturn!
It's very well done that, because in the script, it does say, wrestling voice.
After all of that, it's going to kind of chill out a bit and talk about ice.
And also in this series we're discussing history of music, recording with Brian Eno and looking at nature's shapes.
So, listen wherever you get your podcasts.
Hello and welcome to World Business Report from the BBC World Service.
I'm Rahul Tandon, plenty coming up on this edition as we continue to look at what is a pretty uncertain global economy.
We'll be looking at what the impact of tariffs is having on that and also hearing how they're affecting small businesses.
There's no question that Trump's tariff tantrum has lit a fire underneath both the European Union and India to try and strike a deal.
but let us start off on wall street where uncertainty over tariffs and its impact on the world's largest economy has meant that it's been a bad day on the markets the nasdaq suffered its worst day in several years closing at the end down four percent the dow jones well it slipped by two percent here's our north of america business correspondent aaron delmo it has been a brutal day on Wall Street, just a bruising trading day for stocks.
And it's widespread.
We're seeing declines in consumer discretionary stocks, in airlines, apparel, even the tech darlings that really floated this enthusiasm and exuberance around trading for much of last year.
What caused the sell -off today in particular?
You don't just look at the markets, you speak to people involved in the markets.
What are they saying to you?
It's been a bit of a brewing and something that really popped off as of yesterday before markets opened.
So when we talk about the brewing here, certainly there have been a couple weeks of stock market declines.
And remember, Rahul, that followed some gangbuster results after President Trump's election, what we were calling the Trump bump.
Then we saw that softening in recent weeks.
And then last week when we saw the tariff back and forth, President Trump enacting tariffs on China and the U .S.'s North American neighbors, announcing them rather, and then delaying them.
That kind of back and forth stems uncertainty and investors classically don't like uncertainty.
That's when we started to see some declines.
But what really popped off was an interview that President Trump did on Sunday with Fox News, where he didn't rule out the possibility of the U .S.
entering a recession.
He called it instead a period of transition.
And that is something that is spooking investors today and something that's contributing to the selloff.
We're going to hear more from Erin very shortly, But let's hear a bit of that Donald Trump interview that took place with Fox Business.
Are you expecting a recession this year?
I hate to predict things like that.
There is a period of transition because what we're doing is very big.
We're bringing wealth back to America.
That's a big thing.
And there are always periods of, it takes a little time.
It takes a little time.
But I think it should be great for us.
I mean, I think it should be great.
So will Monday's market reaction lead to Donald Trump changing his policy on tariffs?
Here's Erin Delmore again.
If there is a negative feeling, that is something that presidents historically have taken into account.
President Trump in his first term looked at the markets and he even used them as a barometer of his own success.
You know, he would point to a great day on Wall Street and actually reflect that back on his time in office.
But what he said recently is that he's not looking at the markets And he said it a couple of times in a couple of different ways.
And so that does make you think here, well, how much is he taking his cue or taking input from what's going on on Wall Street?
Here's something we know for sure.
We know that he chose to delay tariffs on the auto industry by a month based on phone calls he had had with people in the car industry.
And this seems to be President Trump's style.
When people pick up the phone, he takes notice and he takes that to heart, it seems.
Aaron Delmore, though, let's bring in Peter Jankowskis, Vice President, Research and Analysis for Financial Services.
A lot of people heard that interview with Donald Trump talking about a possible recession.
Were you surprised at the market reaction today, Peter?
Not really, because when you look at President Trump's statements, he typically is upbeat about the markets calling, expecting them to go up.
And his reticence, his unwillingness to speak and rule out a recession, I think really caused some people to think about it.
They certainly did.
And they thought quite a lot about Tesla, down 15 percent.
Why was that stock hit so hard?
Well, it's a combination of things.
They did actually have some weaker guidance on sales, which, you know, for any growth company is a negative.
And I think also there have been a number of articles talking about, you know, increasingly negative views among Tesla owners, etc., about Elon Musk and his current activities.
So that combination, I think, really hit the stock particularly hard today.
It certainly did, Peter.
Stay with us. Plenty more to talk about on the program.
Of course, it's not just the markets that are being affected by this uncertainty that we keep talking about here on World Business Report.
It's making life difficult for many businesses in the U .S., in Canada and Mexico.
We wanted to bring you a sense of that.
So here's Brian Zelga.
He's the owner of Fishtown Seafood.
He sells a range of seafood in Philadelphia and New Jersey and imports 60 to 70 percent of his oysters from Canada.
I'm a smaller business, so in seafood it's very capital intensive.
So the ability to put up a lot of product in, say, frozen cold storage is I'm not able to really take a huge significant position where that increase in price would actually really, really be meaningful when I look at cash flow and where the market would be heading anyhow.
And the other piece is when it comes to the salmon that we source from British Columbia and the oysters, those are perishable products with a shelf life, so you're pretty limited in what you can do.
It's completely different than bringing in a component that is in auto manufacturing that makes a portion of a transmission or steering wheel or whatever might be going into an automobile.
What we're buying is the complete product.
We're not buying a portion of a product.
So there's no additional ability to absorb the added cost, etc. So in short, to answer your question is we're limited in what we could do.
Both times I brought in product just before the tariffs, obviously a month ago, because they were not enacted and nobody knew what was going on.
none of the dealers, none of the exporters, none of the producers, nobody had any idea what prices would be, what was going on.
And for that uncertainty, I brought in a significant amount of oysters to cover me for a couple of weeks worth.
Although they're perishable, they have about a month shelf life.
This time I brought in less.
I brought in enough to cover, basically cover my wholesale customers for about a week and a half.
Normally we bring in to order, but I brought in enough to cover them for a week and a half so that they would have time and we would have time to adjust their menus once we knew what pricing would be you as you said that are a smallish business so even making those adjustments affects your cash flow doesn't it totally it totally affects my cash flow and it really I mean it really doesn't matter if you're big or small like it's it's cash flow and it's um it definitely affects affects that absolutely You have eloquently described some of the uncertainty and how that's affected your business.
How do you plan to run a business in times like these?
Have you ever seen anything like this before?
I mean, I've not. I mean, I opened up in the middle of COVID.
So certainly my business was certainly built out of chaos and uncertainty and disruption.
And in this case, it's indescribable.
These are things that like from a business perspective, there's no business planning that you can do to get around this.
I mean, take, for example, oysters, the oyster farmers, it takes them several years to grow, like particularly in Canada or even domestically, it can take one or two years to grow an oyster to market size, sometimes even longer.
Domestic farmers who are really going to see any upside or would have seen upside this week if tariffs were in place or a significant upside would be ones that had made a business decision several years ago to grow their business and at this moment had excess oysters that they didn't have a market for.
That's really the only people who would have domestically really benefited off of this in a meaningful way and for a longer period of time.
A final question to you.
Donald Trump says that he does this, the tariffs, to protect the US.
They're being treated unfairly.
Do you understand his rationale, even if it is affecting your business?
You know, I do think there are areas in certain businesses and certain things where American consumerism probably could use a reset on how we do things.
In the case of something like this where it's seafood and the quality of products and the trading partner and the geography and all the things that are intertwined with it, if you wanted to protect American seafood, what you would do is actually implement standards that they have in Japan and that they have in the European Union related to chemical adulteration.
alteration, you would implement the same standards that Canada and Mexico have that would purge out the use of carbon monoxide gas in tuna to take brown tuna and turn it red so that it looks appealing.
Those are the things you would want to do if you want to make, quote unquote, make America great again or make our seafood great again.
You wouldn't be the race to the bottom and import the lowest quality products into the United States and have us be the dumping ground for for seafood for for countries that are producing and have inferior quality seafood peter jankowski is still with us fascinating to hear from a small business like brian there in the u .s and what he's talking about there is something that businesses of all sizes are facing are in canada mexico and the u .s peter at the moment uncertainty about what future tariff policies are going to be Indeed.
I think that is a defining feature of this is that it is across the board.
It's regardless of size.
In some ways, it actually hits the larger firms harder since, you know, it's pretty hard to find a massive new source of product, whereas a smaller firm might be able to find some little niche there and snap it all up and keep themselves going.
That's a fundamental difference from some of the difficulties that we've had in the past with greater regulation, that tends to fall more on the smaller firms and the larger firms.
And the stock market keeps powering on.
But this one's across the board.
We had strong words in the last 48 hours from the next Prime Minister of Canada, Mark Carney, who basically said he was going to stand up to Donald Trump.
Now the Premier of Ontario, a state in Canada, Doug Ford, has said that the surcharge on electricity, which they're now going to put in will raise a total of up to 400 ,000 eight dollars a day from the states of new york michigan and minnesota and increase household costs there on an average this will add around a hundred dollars per month to the bills of hard -working americans let me be clear i will not hesitate to increase this charge if necessary if the united states escalates I will not hesitate to shut the electricity off completely.
So strong words there.
Let's cross the border into Canada where the trade spat is also impacting small businesses.
Let's hear from one.
Benson Mutalemwa owns Kinyota, a store specialising in non -alcoholic drinks in Ottawa.
He's bought in some American products only to find that his patriotic customers are boycotting them.
Benson, thank you so much for joining us here on World Business Report.
So they're boycotting them, I presume, because of these threats of tariffs.
What impact is that having on you?
Absolutely. So as Canadians, we are in this really uncertain time where we have to stand up for our country.
But at the same time, as a business operator, we're dealing with the reality of having products that we've already paid for.
It's already on our shelves, and we're having to basically watch our capital all tied up in this inventory that now customers will not purchase.
What will you do now?
Because if they're not going to buy them, what do you do with this product?
Is that just a loss you're going to have to write off now?
Well, there isn't really a good answer for this because these products do have a best before date that gives us some time to kind of wait and see what will happen.
Hopefully cooler heads will prevail and we'll find a way through this.
But the reality is if this is not solved by Later this year, we will start to see some of these products pass their best before dates and they'll basically become losses.
Give us your sense, because I'm sure you're talking to customers as they come into your shop, about that strength of feeling.
It seems that, you know, people, if you're going to boycott American products at the moment, are pretty angry.
Will they calm down?
Well, so I think there will be some structural change in how we see industry in Canada approach maybe this niche but growing fast space of non -alcoholic drinks.
And hopefully we'll start to see more Canadian content available for retailers like myself to carry.
But as we stand right now, it's very difficult to find like -for -like opportunities where we can say, okay, you don't want to buy the American product.
Here is the Canadian equivalent.
There are always going to be some differences in the products, and we don't know how long this current feeling will stay in the market.
Does it mean that long term you have to think of finding those products, making them yourself maybe, and moving away from the U .S.?
Absolutely. So we're actively working on that right now.
But as a small business, just as you have your capital tied up in this American inventory, it's really hard to pivot and start to look at other places because, you know, the plan was to get this inventory in, sell through, and you continue to grow your business that way.
There isn't a lot of excess capacity to reallocate to something else.
So it really becomes hard when you don't have the resources to pivot when you kind of get caught up in this unexpectedly.
20 seconds if you don't mind.
Benson, have you ever seen anything like this?
did you imagine you'd have a situation where people wouldn't buy U .S.
products in your shop?
I never imagined it.
I never imagined this in my life, and I didn't imagine it two months ago.
Well, listen, we're going to keep in touch with you and see how this develops.
But thank you for joining us on the program, Peter.
The problem is, though, if Americans feel that their products are being boycotted in Canada, could they do the same thing in the U .S.
to Canadian products?
It certainly could happen.
I think the overall strategy that some of the Canadian governors are taking is the one that makes the most sense, is to try to focus the pain, if you will, in certain areas.
if you look at it from an overall perspective it's going to be difficult for the the canadians to have the united states feel the same level of pain across the entire country you know 30 of their their economy comes from exporting to the u .s in the u .s we import about 10 so from a pure numbers perspective on a scale factor they're going to find it very challenging But if they can focus the difficulty, much as some of the discussions have focused on the auto industry.
Yeah, that's that's a particular pain point for the U .S.
And that's an industry that has a great deal of influence.
So they have a chance to change policy there.
But if if they're just going to try to go about it, you know, one large unit against another large unit, it's not going to.
Hello, I'm Robin Ince and I'm Brian Cox.
and we would like to tell you about the new series of The Infinite Monkey Cage.
We're going to have a planet off.
Jupiter versus Saturn!
It's very well done that because in the script it does say wrestling voice.
After all of that, it's going to kind of chill out a bit and talk about ice.
And also in this series we're discussing history of music, recording with Brian Eno and looking at nature's shapes.
So, listen wherever you get your podcasts.
we're off well you're with world business report from the bbc world service let's talk about india and the eu now trade agreements and trade wars there is another important event that's coming up india and the european union are back at the negotiating table this week aiming to finalize a major free trade agreement meanwhile india and europe look like they could be moving closer to that free trade agreement after talks resumed on Monday.
The head of the European Commission, Ersla von der Leyen, has said if a deal is to be passed, it would be one of the biggest of its kind anywhere in the world.
I've been discussing this with Milan Vaishnav.
He's Director of the South Asia Program at the Carnegie Endowment for International Peace, where he also holds a podcast about India called The Great Dimasha.
I think there's no question that Trump's tariff tantrum has lit a fire underneath both the European Union and India to try and strike a deal.
I mean, this is in a kind of world economic scenario where there are not a lot of safe havens.
So I think, you know, countries, you know, economic blocks like the EU are really gravitating towards partners with, you know, where they could strike a deal.
And I think what Trump is doing right now in Washington is giving people a lot of heartburn and a lot of sleepless nights.
I think it's absolutely a factor that is driving these two very powerful economies closer to one another.
What do they want from each other?
What could be the sticking point in a deal between them?
Well, I think for the European Union, it's pretty clear that when they look at a whole range of exports, be it vehicles, be it alcohol, be it agricultural products.
They are finding it very hard going to get access to the Indian market.
India is a relatively protectionist economy.
It has high tariffs, higher than most other countries in the world.
And the EU has long tried to implore India to bring those down.
India, for its turn, of course, they want greater market access.
They are looking for lower tariffs on things like pharmaceutical products, on textiles, apparel.
But one thing that's really important for India is improving labor mobility.
I mean, India has a massive services trade.
We've all seen and heard about the global capability centres, the business process outsourcing, all of this kind of tech infused service work that gets done in India.
Well, India would like to make greater inroads into the European market, but to do so, it needs to bring its people over.
So the EU, I think, is primarily motivated by greater goods access into the Indian market, where India is really focused on improving services and expanding their reach into the European context.
Which could be difficult because immigration is such a big political issue, isn't it, in many parts of Europe.
Just coming back to that idea of tariffs and India, in a way, that's also Donald Trump's point, isn't it?
The same one the EU makes, which is India needs to open up its market if it wants the US and others to open up their markets.
That's right. I mean, you know, Donald Trump has made this case repeatedly.
He made it in the first term of his presidency as well, saying, you know, we have a relatively low average tariff in the United States on goods that India would like to export to our country, why is it the case that India has not reciprocated?
And again, the European Union is making a similar case.
But I would like to point out that the ways in which these two economic powers are handling this dispute are very different.
I mean, Trump has come out with a lot of bluster, a lot of threats, calling India the tariff king to try to put pressure on them to come to the table.
The European Union, for its part, has used much more conciliatory language, trying to create a more hospitable environment for friendly talks between the two trading blocks.
Milan Vishnav there.
Let's move to another country now that Donald Trump has been talking quite a lot about.
And that is at the top of the world because the people of Greenland are heading to the polls on Tuesday.
Its strategic location and rich natural resources have caught the eye of Donald Trump, who has repeatedly said that he wants to take it over.
Adrian Murray has been to the south of Greenland and has this report from there.
Jagged grey peaks appeared before us as the motorboat waved through dramatic fjords at Greenland's southern tip.
Now we're coming out of more rolling hills into more alpine landscapes, a very high mountain, pointy mountain.
On board Elder Olofsson, the chief executive of mining firm Amarok Minerals, gestured ahead.
That alpine landscape is basically a gold belt that is about 50 km wide and 200 km long.
At a two -hour sailing, we stepped ashore near the base camp, A cluster of mobile buildings beneath Nalanak Mountain, where Amarok is drilling for ore.
Going by car, we drove into the gold mine and followed a dark tunnel that ran upwards inside the mountain.
Now just turn on your headland.
Olibson pointed to a seam in the blasted rock face.
Do you want to get a little bit of gold fever?
Do you see the gold here?
I see. And so this is the quartz, and the gold sits within the quartz, gold, gold, gold, gold, all the way over.
Isn't that extraordinary?
In the nearby mountain range, the firm is hunting for valuable copper, nickel, and rare earth elements.
Olufsen thinks Greenland's untapped mineral reserves are a huge opportunity.
The world has been mined for the past 100, 150 years.
There are only a few countries that are really left.
I would argue that, you know, Afghanistan, Colombia, countries like Greenland.
I'm talking about of any significant scale.
All of the resources are close to the surface and there are deep water fuel to get to these resources.
This is in a Tier 1 jurisdiction and can be the supplier of all the minerals at least the Western world need for decades.
Greenland is endowed with an abundance of valuable minerals, among the rare earth elements, and critical metals like graphite and lithium, all vital materials needed for technologies like mobile phones, chips and batteries.
Globally, there's a race to secure supplies, and that's fuelled exploration efforts in this vast Arctic territory.
Christian Kjelson is the director of Greenland's Business Association.
The geopolitical situation right now is driving more interest in Greenland.
You have a very strong China, very heavily on the critical raw materials.
Companies involved in this and the government involved around this are looking to safe places where they can access the critical raw materials.
And Greenland is a safe jurisdiction in many ways.
It's very close to Europe, it's very close to North America.
But despite the hype, any potential gold rush has been slow to get going.
And while dozens of exploration permits have been issued, so far only two mines are active.
Jakob Kleve Kaiding is from the Geological Survey of Denmark and Greenland, which has mapped the territory's deposits.
We also have some challenges in Greenland, because it's Arctic terrain, it's not very easily accessible.
We have problems with harsh conditions in terms of the climate and limited infrastructure.
So for those reasons, it's quite expensive to open a mine.
Naya Nathanielsen, Greenland's Minister for Business, Trade and Raw Materials, hopes another three to five mines will be operating within the next decade.
We're used to being a hotspot for the climate crisis.
We want to be a part of the solution as well.
And we do have a lot of the things needed for this transition to succeed.
The country's three billion economy is driven by the public sector and fishing.
Gryland's government wants mining.
The Incan could help reduce its reliance on subsidies from Denmark and boost its independence goals.
An issue that dominates this Tuesday's pivotal election.
Jess Bertelsen, the head of local labour union SIK, favours growing the sector.
The country needs more income and well -paying jobs, he tells me.
Now, we only produce fish.
If that disappears, we'll have nothing else to earn money from.
So we need more job creation in other professions.
Greenlanders are soon heading to the polls to vote on their country's future, all under the gaze of Donald Trump.
It's unclear what the US president's Greenland gambit will mean for mining, but there are hopes that this unprecedented tension will bring much needed investment into the country.
Adrian Murray with that reporter.
And Peter, we're going to see China and the US increasingly competing for those resources, aren't we?
Indeed. You know, that is a prime fight.
China has a fair resource reserve of its own, but they've been working very hard to try to work in and develop properties like this all over the world.
Peter, as always, thank you for joining us here on World Business Report and guiding us through what has been really a pretty turbulent day on the US markets, the world's largest stock exchange.
What happens there has an impact on many other stock exchanges across the world.
We're going to be back with you with Business Matters at 0100 GMT.
Please do try and join us for that program if you can.
Hello, I'm Robin Ince And I'm Brian Cox and we would like to tell you about the new series of the Infinite Monkey Cage We're going to have a planet off Jupiter vs. Saturn It's very well done that because in the script it does say wrestling voice After all of that it's going to kind of chill out a bit and talk about ice And also in this series we're discussing history of music recording with Brian Eno and looking at nature's shapes So, listen wherever you get your podcasts.
