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If journalism is the first draft of history, what happens if that draft is flawed?
In 1999, four Russian apartment buildings were bombed.
Hundreds killed, but even now we still don't know for sure who did it.
It's a mystery that sparked chilling theories.
I'm Helena Merriman and in a new BBC series I'm talking to the reporters who first covered this story.
What did they miss the first time?
The History Bureau, Putin and the apartment bombs.
Listen on BBC.com or wherever you get your podcasts.
Trump retreats on tariffs.
What I'm asking for is...
A piece of ice, cold and poorly located, that can play a vital role in world peace and world protection.
It's World Business Report from the BBC World Service.
I'm Leanna Byrne.
President, Donald Trump has rolled back on the Greenland trade fight with European countries, and the EU Mercosur trade deal is sent to court.
OK, so the last 24 hours has been a lot.
We've gone from the brink of a potential military invasion to that being taken off the table, but not the tariffs, to now the tariffs being taken off the table and the framework of a future deal.
Here's the president speaking to reporters in Davos after talks with NATO allies.
And yes, that is a piano you can hear in the background.
The deal is going to be put out pretty soon.
We'll see.
It's right now a little bit in progress, but pretty far along.
It gets us everything we need it to get.
Does it still include the United States having ownership of Greenland like you've said you wanted?
It's a long-term deal.
It's the ultimate long-term deal.
And I think it puts everybody in a really good position, especially as it pertains to security and minerals and everything else.
The ultimate long-term deal.
But what do we know about this deal?
I asked your economics editor, Faisal Islam, who's been following events in Davos all day, if we have any details.
Short answer, no.
But longer answer, Donald Trump thinks that the deal is done and everyone has calmed down about it.
Now, the devil is in the detail, as you obviously imply there.
We don't know if it includes acquisition of Greenland.
I think we can probably conclude that it obviously doesn't, because we'd have heard from Denmark by now.
And we don't know.
Obviously, the assumption is that the tariff threat has been dropped, as you say, because he says it has.
But he says things one day and they change the next day.
Indeed, let me give you a direct quote from a G7 leader who told me, right now we feel relieved.
Things are better now than before.
However, this is a leader who changes his mind every day.
Are country delegates breathing a sigh of relief over President Trump saying also he's not going to use force to take over Greenland?
Well, yes.
And certainly that's the case.
That's the main source of relief here.
Let me take a step back.
You know, I felt like being a bit of a witness to history here.
Maybe that's slightly overstating it.
But it was an historic speech in the sense that Donald Trump came to Davos to rewrite the ways, the rules of the way, in terms of how the world works.
And he tried to do that.
But Here, they heard that.
They heard the messages.
They saw the messages on social media.
They saw the threats against Greenland.
And leaders like Mark Carney of Canada, like Emmanuel Macron of France, decided to push back hard against it the day before.
Donald Trump acknowledged that he'd seen those speeches and he wasn't too happy.
But he also seemed to listen a little bit to those speeches.
Also listening to some of the pushback that I have heard about.
Howard Lutnick, his Commerce Secretary, started talking to a European audience about how terrible Europe was.
You're dead, he said.
There was a walkout.
All this was coming back.
There was a bit of skittishness in the markets.
And he appears to have rode back somewhat.
Subject to interpretation, that's the current position.
I spoke to Gavin Newsom, the Democrat governor of California that some say might one day be a presidential candidate.
He said, this is taco Tuesday.
Trump has chickened out.
So that is a view.
But I have to say that there is some interpretation left for his ongoing desire to get Greenland.
If he still means that, and that is what he said, let's see where this really goes.
Remind us, Faisal, what's that acronym, Taco Tuesday?
Taco, Trump always chickens out.
That is the suggestion.
He sort of marches up the hill and panic is out there.
And then he sort of winds back down again.
But I think, and so people have got through this strange moment, this what's been called the Greenland crisis, by sort of a bit of laughter and humour and just assuming it's so crazy that it could never happen.
But these were serious suggestions of acquisition of Allied territory by force or through economic coercion.
Some part of that story still exists.
I think we may not have heard quite the end of this, even though right here today, people think that this Davos moment has calmed things down.
Now Faisal, before you go inside and get warm, I'm wondering about this EU-US trade deal that was agreed last July.
Because of that Greenland tariff threats and everything else going on the work on that was suspended.
We reported that yesterday.
Is there hope that might get back up and running?
Well, this is a very interesting question.
What were the lessons being learnt from this situation?
Europe will say right, maybe our plan over tariffs over the past year of trying to mollify Donald Trump?
Well, that didn't work very well.
We should now be harder.
We should be like Emmanuel Macron and Mark Carney.
And you're going to see a hardening of rhetoric.
So, even though the current situation is, quote unquote solved, we may still see them deploy or holster this weapon, this bazooka, which would threaten massive tariff retaliation, purely conditionally, purely to try to show strength.
So has the rest of the world been sent a lesson to show strength, to join forces and to resist?
Will that have an ongoing different impact on these sorts of dynamics?
These are now open questions, but it's worth watching what happens in Brussels tomorrow when they will discuss this instrument.
And some will say we shouldn't put down our weaponry just yet.
Because as I said, this European leader told me, we do not know what he's going to say tomorrow.
That was our economics editor, Faisal Islam, who was speaking to me just a little bit earlier from Davos in Switzerland.
With me now, George Conboy, chairman of Brighton Securities in New York.
George, I have whiplash from today.
How are you feeling?
No whiplash here.
We have so much scar tissue from 40 years of ups and downs that one more day won't make too much difference.
George, you've seen it all.
I'm going to get you to just go back for tomorrow.
Yesterday, rather for me, because yesterday the stock markets were down, weren't they?
And it's kind of turned around today.
Sure, sure.
So Trump is a New York real estate operator, right?
And that's a bare knuckle business.
And I sometimes get the impression that in Europe, everybody wants to be more genteel.
So yesterday, there's a threat of force with Greenland and traders lose their minds.
Dow Jones Industrial Average.
Down 800 points, nearly off a cliff, at least according to some people.
Today, we say, well, we're not going to use force.
We want to make a deal.
We think we have a framework.
And the markets are back up with the Dow up nearly 6%.
You know, we're up from where we were on December 31.
Markets are doing okay.
The economy is doing okay.
But, boy, that's a lot of action in two days.
Yeah, it's a lot of action.
What are some of the companies that were hit the most?
Well, you know, I'm looking at it today and I'm seeing that technology was way up across the board.
Banks were off a little, not because of the Europe thing, but there's some concern over the credit card cap.
Maybe
Defense stocks have been doing very well for reasons that are probably obvious, even if they're never obvious.
They never have been likely.
There's not going to be any use of force in Greenland.
But the conversation has been changed.
You know, we say he took them to the cliff.
You grab your opponent by the scruff of the neck, hold their head over the cliff and show them the rocks so that you never really meant to throw them over the cliff.
But when you yank them back from the cliff. they're happy they didn't get thrown over.
And I think that's what happened in Davos.
This sounds like an episode of The Sopranos, I have to say.
Well, it is all New York, you know.
Yeah, yeah.
Fair enough.
Fair enough.
Totally.
What about mining companies?
I wonder, part of the discussion around Greenland is tapping into those natural resources.
And we don't know the details of a deal, but he did mention that getting access to those minerals might be part of it.
Yeah, and whether we're getting access to it or someone is.
It's a plus, probably for the world, just like Venezuelan oil.
We don't have to take the oil, get the oil, let the Venezuelans sell it, but it gets on the market.
It makes supply better and prices lower, and that may also be a thing with minerals in Greenland.
It's probably a plus.
What's interesting to me is that I feel like, after weeks and months of ignoring a lot of US announcements on tariffs and some policies, we see the markets were really rattled.
Why now?
Yeah, well, because as your previous commentator mentioned, Trump is very mercurial.
I'm going to do this today or I'm thinking I'm going to do this.
And I often think you ought to discount by about half or maybe 75 percent everything he says.
Just watch what he does.
Don't worry about what he says.
Watch what he does or what we do as a nation.
And you'll have an easier time negotiating markets that way.
OK.
All right, we're going to stick to your side of the Atlantic, because the US Supreme Court is hearing arguments in a highly charged case that could test the independence of America's central bank.
At issue is President Donald Trump's attempt to remove Federal Reserve Governor Lisa Cook, a move that critics warn could set a dangerous precedent.
Trump has been openly critical of the Federal Reserve, accusing it of moving too slowly on interest rate costs under Chair Jerome Powell.
After the hearing got underway.
At the US Supreme Court.
Lawmakers gathered outside in freezing conditions, raising concerns about what the case could mean for the Fed's political independence.
Here's Democratic Congresswoman Maxine Waters.
Make no mistake.
This is about power and control.
Donald Trump wants to control the Federal Reserve so that he can manipulate interest rates, interfere with markets and use our independent government agencies to advance his own agenda.
Our North America business correspondent, Michelle Flurry, has been following events today, and she started by explaining who Lisa Cook is.
So Lisa Cook is a governor on the board of the Federal Reserve.
That means that she is one of the people around the table when the policymakers inside America's central bank vote on interest rate policy.
And she has come under scrutiny over a mortgage application that she filled out and whether or not she lied on it.
Now, she claims that she has not committed or done anything wrong.
And that case is working its way through the courts and in fact, indeed has worked its way all the way up to the Supreme Court, because the Trump administration is trying to get her removed from her job as the governor of the Federal Reserve one of the governors of the Federal Reserve on the grounds that she should be removed for cause, because you can't just sort of fire Federal Reserve officials for kind of any reason.
Exactly.
That all happened last August.
And President Trump said all this in a post on social media where he said he wanted to fire her.
And then she sued to stop the dismissal, didn't she?
And so this is where we're at today.
That's right.
And it's being seen very much as a sort of case that is, a test of presidential power over the independence of the central bank.
Because of that legal threshold of the cause that is meant to protect the Fed from sort of political pressure that is being questioned, but also the idea of due process.
That was very much something we heard a lot about in today's hearing.
So what happened today, Michelle?
I mean, I think the key takeaway is that the response of the justices.
You know this was just a hearing where they get to ask lawyers for both sides questions.
And there seemed to be a degree of scepticism, or at least caution, about why the court should intervene quickly.
And they warned that maybe by moving fast that could undermine confidence in the independence of the central bank.
And what was notable is that actually, it was several of the conservative justices who also raised that question, including Justice Brett Kavanaugh, a Trump appointee, who warned that the administration's argument could, in his words, weaken or even shatter the Federal Reserve's independence.
And as a result of that, if you look at sort of what prediction markets are kind of betting, they think that there was a degree of scepticism.
And so they think that potentially may move things in the favour of Lisa Cook.
So there's no judgment yet and they're not going to make their decision quickly, essentially.
No, there's no imminent ruling.
This was just a hearing.
But based on sort of the types of questions they were asking, it does suggest that the court is inclined to slow things down.
And that, of course, could be a setback for the White House which, as we know, is sort of unhappy with the direction that interest rate policy has been moving in and has been sort of going after not just Lisa Cook but also the Fed chair, Jerome Powell.
Well, did he show up today, actually, because that was something some people were looking out for.
And he's facing his own criminal probe, isn't he?
Yes.
So he showed up.
And that was remarkable on a number of fronts.
The Federal Reserve typically tries to stay separate from politics and out of the fray.
But ever since it emerged that the Justice Department was investigating the Fed chair, Jerome Powell himself, over a sort of renovation project at the Federal Reserve, he took the unusual and very extraordinary step of putting out a video basically saying make no mistake, this is all politics and has nothing to do with the issues they say it has.
This has to do with interest rate policy.
You know, this is not the type of thing you hear from central bankers.
They usually kind of try and pass their words very carefully, don't say things too explicitly.
But yet you had him on a Sunday night putting out a video statement.
And now today I should say on Wednesday appearing in the Supreme Court, at this hearing today, in support of Lisa Cook.
And not only was there just Jerome Powell, but there was also another former central banker, Ben Bernanke, who has also spoken out in support of Jerome Powell and in support of the independence of the Federal Reserve, which clearly they're very concerned about.
That was our North America business correspondent, Michelle Flurry.
George, is this case something investors would pay attention to?
Would it move markets?
It could.
It could.
I don't think that traders really care much about Lisa Cook or any of the other Biden appointees on Wall Street.
Their currency isn't too high.
But the general idea of the independence of the Fed.
Remember, even if you like a decision from one president, You don't want some future president who might make a decision.
You don't like to change it.
So the lawsuit and the idea that Trump could remove someone preemptorily would not be viewed favorably by traders in general.
OK, George Conboy, stay right there.
If journalism is the first draft of history, what happens if that draft is flawed?
In 1999, four Russian apartment buildings were bombed, hundreds killed.
But even now, we still don't know for sure who did it.
It's a mystery that sparked chilling theories.
I'm Helena Merriman and in a new BBC series I'm talking to the reporters who first covered this story.
What did they miss the first time?
The History Bureau, Putin and the apartment bombs.
Listen on bbc.com or wherever you get your podcasts.
Now to another deal that's in the works.
That's the sound of farmers protesting outside the European Parliament in Strasbourg today.
They're angry at the EU Mercosur trade deal, which would remove tariffs on more than 90 of goods traded between Europe and South America.
Today EU lawmakers voted to send that deal for legal scrutiny at the bloc's top court, the European Court of Justice.
This move that could delay an agreement that's already been 25 years in the making.
So, from the perspective of South America, does this look like due process or yet another political roadblock?
Wilbur Barrow is an international trade consultant and former foreign trade secretary of Brazil.
And he joins me now.
Wilbur, thanks for joining us.
Thank you.
Thank you for the invitation.
From South America's point of view, how is today's vote in the European Parliament being read?
Oh, it's certainly a frustration.
We've been negotiating this agreement for 25 years.
It's clearly a positive agreement for both sides, considering the geopolitical situation.
And now we are probably going to have a delay for this consultation with the European Court.
And after, it still has to be voted by the parliament and the Mercosur Council's congresses.
Well, but it seems to me and it sounds to me like you're running out of patience.
How much patience is realistically left among Mercosur governments?
Well, Mercosur is not waiting only for Europe.
Mercosur last year signed an agreement with the EFTA countries.
The other European countries signed with Singapore.
There are no negotiations going on now with Indonesia, with Canada, with Vietnam, with other countries.
So it's unfortunate that one of the consequences of this delay is that Mercosur is going to look more to Asia and not to Europe.
Now one of the concerns in Europe is that parts of the deal could limit the EU's ability to regulate on food standards or the environment.
From Mercosur's side, is that seen as a fair concern?
No, basically it's seen as a protectionist view from an inefficient agricultural sector in Europe.
Basically when you compare the cost of production from beef to soy to corn.
Of course, because of natural conditions, the Mercosur countries, especially Brazil and Argentina, are extremely competitive.
On the other side, the European industry can export a lot to a growing market in South America.
So, even talking about the geopolitical side, because America is interested in not depending so much neither on China or the US,
So we are losing time, basically.
You've got European farmers, though, out in the streets.
They're saying they're being undercut by cheaper South American imports.
What is your response to those fears?
Well, you can compare in terms of sanitary or conditions or environmental conditions.
You are not going to find except for very specific situations, you are not going to find a widespread lack of compliance from the Mercosur side.
And in any case, today you have exports to Europe that comply with European rules.
So basically, our reading in South America is that they are only fighting for more subsidies.
Now, there is one thing that the European Commission could do.
It could provisionally apply the deal without Parliament's final approval.
Do you think that they should do that?
Well, I think they could do that, but probably they are going to wait for the Mercosur countries to ratify the agreement.
And well, in general, that's going to take one to three years because it has to go to the Congress and to the Senate of every country in the Mercosur country.
So in any case, it's going to take at least one more year to ratify nationally, maybe after that.
If their opinion in court takes more time, maybe the commission will have the guts to move on.
Still listening to this, George Conboy, chairman of Brighton Securities.
George, do you think this episode feeds into a broader investor concern that the EU struggles to execute big trade deals?
Oh, struggles to execute almost everything.
A very sclerotic organization.
Looks like France maybe wants to drag it down because of fears about agricultural protectionism.
But it's not a good look.
I mean, 25 years and your guest said we weren't waiting around.
Well, what about you, Albert?
How long do you want to wait around for?
Well, you know, I was the negotiator in 2010 when we relaunched the negotiations in Madrid and we thought that would be closed in two years.
So we were waiting forever.
But the difference now is that there is a huge incentive to close agreements with other countries.
Even the after countries, we will move on with the agreement with Nicosur.
And, as I said, we are going to have more incentives to move on with the other Asian countries and not with Europe.
And that's a pity.
All right.
Welba Barrel, International Trade Consultant and former Foreign Trade Secretary of Brazil.
Thank you so much for joining us.
Now, Slovakia may be small, but it punches well above its weight when it comes to car making.
The Central European country produces more cars per person than anywhere else in the world.
Close to a million vehicles a year for a population of just five million.
Several of the world's biggest manufacturers now have factories there, with Volvo the latest to join the list.
John Lawrenson takes a look at under the bonnet of Slovakia's car industry in this report from the city of Jelena in the north of the country.
In a huge factory surrounded by mountains covered in snow.
A lift lowers the steel bodies of cars onto the start of an assembly line.
They've just been welded together by robots, 690 of which work in this factory.
Now an army of human workers in red trousers and white T-shirts will transform these steel shells into finished cars, one of which drives off the end of the assembly line every minute, flashing its headlights.
This is the European factory of the Korean car manufacturer Kia, just outside the Slovak city of Jilina.
3,700 people work here, including assembly line worker Simona Krneva, 23.
She works on the doors.
She studied business before coming here.
She tells me it's not her dream job, but it has its good points.
Half of my family works here, so I wanted to try.
Salary's OK?
OK.
Yes, it's very good in comparison with other companies.
I earn about 1,300.
Euros a month, just over $1,500.
Lower than the average salary in the factory, which Kia tells me is almost twice that.
Are you proud of Slovakia's performance when it comes to car production?
Yes, I'm proud of that.
I like the fact that thanks to that the production supports our society.
When Slovakia was part of the Czechoslovak Socialist Republic.
The cars it made were, by Western standards shoddy noisy, thirsty and slow.
But after the Velvet Revolution, a non-violent transition of power in 1989 sent its communist rulers packing and the Czechs and Slovaks agreed to split into two independent countries.
Volkswagen bought and overhauled the old Czechoslovak carmaker.
Skoda and other foreign automobile manufacturers moved in too.
Peugeot Citroën, now Stellantis, Kia, Jaguar Land Rover, and now Volvo.
Peter Prokop is the Czech-German head of GIV, a management consulting firm that advises clients in the automotive sector.
The labour cost was 20% of the labour cost in Germany.
Wow.
One to five?
Yes.
On the beginning, definitely.
Is it still a good bet going to East Central Europe?
Yes, maybe.
On one hand, you have still lower wages.
I would say 60% of the Western wages in Eastern Europe still.
But you have also high productivity, so it's definitely competitive.
At the end of the assembly line I see a car driving around that is completely swathed in padded cloth.
Please don't photograph that, says the Kia person accompanying me, even in its dark grey sheath.
It's their new all-electric vehicle, the EV2, which will go into production in February.
The president and CEO of Kia Europe is a Frenchman called Marc Andriche.
I asked him why Slovakia.
Slovakia is really in the heart of Europe. quite well connected, let's say, to the big markets.
The quality of the manpower was also, let's say, very, very important.
So Slovakia gives us access to a skilled local workforce and high quality supplier.
What is happening in Slovakia is also happening all over East Central Europe.
In this part of the EU, low wages...
A tradition of industry and educating to provide manpower for industry inherited from communist times, mixed with Western and Asian technology and management, is proving a winning combination.
That report by John Lawrenson.
Thanks to our markets guest, George Conboy.
And that's it from World Business Report.
I'm Leanna Byrne.
Thanks for listening.
If journalism is the first draft of history, what happens if that draft is flawed?
In 1999, four Russian apartment buildings were bombed, hundreds killed.
But even now we still don't know for sure who did it.
It's a mystery that sparked chilling theories.
I'm Helena Merriman and in a new BBC series I'm talking to the reporters who first covered this story.
What did they miss the first time?
The History Bureau, Putin and the apartment bombs.
Listen on BBC.com or wherever you get your podcasts.
