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Asking the right questions can greatly impact your future especially when it comes to your finances.
So if you're looking for a financial advisor you can trust Certified Financial Planner Professionals are committed to acting in your best interest. That's why it's gotta be a CFP.
Find your CFP professional at Let'sMakeaPlan .org This is Andrew Peach with World Business Report.
At a news conference in the Oval Office, President Trump is due to announce a deal with the UK to reduce tariffs.
We'll have the details as they're announced live on the programme.
Despite promises to stop the attacks on ships in the Red Sea, one of the biggest shipping companies tells us disruption will continue for the rest of this year.
And amid the military parade on Red Square to mark victory over Nazi Germany, the presidents of Russia and China will hold talks to deepen their trade ties.
They are trying to establish some kind of joint policy towards the West. They're trying to show to the West that China and Russia will be stronger.
First President Trump is about to start giving details of a deal to reduce tariffs that have been agreed with the UK.
Mr Trump says it's a great honor to have the UK as the first country to reach an agreement.
We're still waiting for the pictures from the Oval Office in the White House and those details, we'll bring them to you as soon as we have them on World Business Report.
Our reporter, James Wickham, is with me.
There's already actually been some important developments in the UK economy today, James, tell us.
It has, Andrew, yes.
We were hoping by this point we would actually know the details of this deal, but we don't and, as and when President Trump walks out to announce them, we'll bring them to you here.
But let's start with the Bank of England because that's cut interest rates by a quarter of a percentage point today to four and a quarter percent, which was kind of expected, to be honest, but the split in the decision making was the thing that was really interesting that not many people were expecting.
They thought it would be unanimous.
It wasn't some of the people on that panel wanted a larger cut, some didn't want a cut at all, but it went down by a quarter of a percentage point.
The bank's governor is Andrew and he said well he hadn't been briefed on this trade announcement when he spoke earlier.
We do now have news that suggests there will be an announcement and we welcome that news.
I very much welcome it and I think it's very well done to those involved.
And the reason for saying that is that it will help to reduce uncertainty and that's important as you will see in the context of what we've said today.
The UK is though a very open economy so the UK is also affected by the way in which trade policy and tariffs affect obviously other economies, that is in other words the tariff measures that have been taken in respect of other economies.
So I say that because I hope the UK agreement, if it is indeed announced this afternoon, will be the first of many.
This will be good news all round, including for the UK economy.
Now, President Trump has said it is a great honour to announce the deal which he has called full and comprehensive.
But our, to be honest with you, Andrew, what we're finding in in the BBC Business Unit here is that we don't think it is the kind of full and comprehensive trade deal in the same way that was struck with India earlier this week by the UK.
But we are awaiting those details to find out.
We do also know though that the UK leader, Keir Starmer, will speak after the Oval Office unveiling.
And we're expecting that in about 20 minutes or so.
Happens. Let's get a reaction to what we already know from Emma Wall, head of platform investments Hargreaves Lansdowne, who's with us live.
The market's already been reacting because there's been talk now this trade deal of sorts, anyway, between the U .S. and the U .K. for hours?
The markets are reasonably flat, and I think it's because we're light on detail.
There's also been quite a lot of trade talk rumblings over the last 48 hours.
We obviously had some news yesterday that the U .K. was flying into Washington to come up with this deal and we also had news yesterday that U .S. Representatives would be going to Switzerland at the end of this week.
I'm sorry, we seem to have lost our connection to Emma Wall at Hargreeves Lansdowne.
So we'll return to Emma and we'll return to this announcement about tariffs between the U .S. and the U .K. in a few minutes if you stay with us here on the BBC World Service.
Let's go to Russia now.
There are lavish celebrations planned for the 80th anniversary of victory over Nazi Germany over the next couple of days.
The big event is a huge military parade on Red Square, where the Russian president will welcome more than two dozen world leaders, including China's Xi Jinping.
He's having talks with President Vladimir Putin at the Kremlin as the two countries deepen their trade ties.
Kril Babaev is the director of the Institute of China and Modern Asia of the Russian Academy of Sciences.
He's been speaking to me from Moscow.
Russia and China trying to show that they are together, that they are coordinating their foreign policies, and they are trying to establish some kind of joint policy towards the West, especially bearing in mind the current situation in the trade tariff limitations by the United States, which is very important for China.
So they're trying to show to the West that China and Russia will be stronger together and that they are still opposing the policy of the West coordinating their own approaches to both the economic situation and the political situation.
So to an extent this was happening anyway China has not been critical of Russia over Ukraine for example but the sense I get from you is that this coming together of Russia and China has been accelerated and deepened by the arrival of Donald Trump back in the White House?
SL. Actually in China there were quite a lot of rumors lately that Russia is going away some way, that Russia is trying to reach a strategic agreement with the United States, which will probably harm the Russia -Chinese relations.
I think President Putin would like to demonstrate that the personal ties with the Chinese leaders are still very strong and that Russia and China are still together and that nothing from the West can actually deteriorate their relations.
And what's the principal trade that goes on between Russia and China?
Russia and China are quite complementary with each other, regarding the economies because Russia is supplying China energy, gas, oil, coal also.
And China is actually quite dependent on the Russian supplies at the moment because they're trying to establish some kind of strategic energy security for their country, bearing in mind that most supplies of oil are still going from the sea, from the south, and that may potentially create a threat to Chinese energy security.
So they're trying to increase supplies from the northern border, from the border from Russia.
So Russia is now doing that extensively and and expanding the supplies as well.
It's interesting that so many of these talks focus around energy supply.
It seems to be something that Donald Trump is very fixated on in his talks with other world leaders, and it seems to be central to this relationship between China and Russia as well.
Indeed. It's quite important, especially important for China, because China is trying to create kind of a balance of supplies from the north and supplies from the sea, from the south.
This is why they definitely need Russian supplies and I think they will need more of it.
Q. Why do Russia and China think they can rely on each other?
Why do they consider each other reliable allies?
A. Objectively they do need each other at the moment.
They do need it because they're both at odds with the West and quite geographically constrained because China has problems mostly in the South with the Taiwan issue and the issues in the South China Sea, and Russia has problems with the West on its Western borders, in Ukraine mostly.
So this is why they think it's quite It's important to establish some kind of security between them and being secure, being reliable for each other on this border is quite important for them in the situation of opposition with the West. Just to be clear, when you say Russia has some problems on its border with Ukraine, it's because it's broken the border, it's invaded Ukraine.
Hello? That's something that I don't want to answer.
I see. And where does this go next?
We've talked about the energy pipeline.
What do you think happens next as these countries continue to to work together more closely?
Since China needs Russian energy and Russia needs Chinese manufactured goods, I think the two countries need each other badly in economic sense, and they do need each other in the political sense as well, because they are trying to establish a single joint line towards in all the major problems in world politics.
The national interests of China and Russia are very much similar at the moment.
And that's Kirill Babaev from the Institute of China and Modern Asia of the Russian Academy of Sciences speaking to me a little earlier from Moscow.
Western Sahara is a disputed territory in North Africa experiencing major economic change.
Now, this all goes back to President Trump's 2020 decision to recognise Morocco's claim over the region.
Now he's back in the White House.
Highways, airports and wind farms are rising from the desert in a multi -billion dollar push for development.
But behind the boom there are questions about the future of the Sarawi people.
Into Safakir is the senior fellow at the Middle East Institute in Washington.
We are talking about a huge push for development in the Dakhla.
All told, I think it's somewhere in the neighborhood of $35 million in sectors like renewable energy, development of green hydrogen, desalination, infrastructure, airport expansion.
And the big one is a port infrastructure to really help and connect Dahla to inter -regional trade routes, and to improve its connectivity to Western Africa.
Why is there suddenly such confidence that this money is a good investment?
A lot of that has to do with the diplomatic wins that Morocco has been scoring on the contested issue of the Western Sahara.
The diplomatic wins changed in Morocco's favor in 2020 when they were able to clench US recognition for their claims on the contested territory.
This was a huge win for Morocco.
I mean, US recognition and more explicit US support has essentially been their white whale.
And finally they got it.
And that really changed, you know, investor outlook in terms of feeling confident about putting their money in the region.
And they're confident nothing's going to change about that because Donald Trump's going to be in the White House for another three and a half years?
I think they're also confident about Morocco's ability to kind of hold on to its claims in region and Morocco's approach and policy, which has very much been sort of development as diplomacy and really creating an underground reality that's very, very hard to undo.
The dispute over the territory is not going to go away.
What sort of response are you expecting from Algeria?
Well, so Algeria has really struggled to figure out how to respond to Morocco because I think right now everything is essentially going Morocco's way.
The focus is very much on the UN to negotiate the issue based on Morocco's preferred resolution, which is autonomy.
Algeria has responded trying to limit this diplomatic tide that has been going in Morocco's favor, and it's been very difficult for them to do that.
They weren't able to do that by putting pressure on Spain.
They weren't able to do that by putting pressure on France.
So I think right now if they want to continue to keep the conflict alive, the challenge for them is to figure out how to strengthen the police areas position and negotiating position because geopolitically things are definitely going in Morocco's favor.
This is a pretty sparsely populated area of North Africa, nonetheless, it's a huge business opportunity here.
Yeah, exactly. I mean, the population is essentially a mix of Sahrawis that live under Morroccan de facto control and of course also Morroccans that have come to the area over the years of Moroccan control.
I mean, for Morocco, it's easy to look at this as just sort of a contested and complicated territorial dispute.
But really, it's a multi -generational investment project that Morocco has really gone all in on.
And so, you have a population that's very much mixed.
And I think this is really a huge opportunity for Morocco to provide development for that population and provide a much better standard of living.
I mean, the standard of living is quite good compared to the rest of Morocco, but to really sort of address that and bring much more traffic to the area.
And what about other countries in North Africa, how are they responding?
Are they pleased to see this or do they regard it as competition?
So far I don't see a whole lot of opposition coming from any of the North African countries.
The one that was potentially nervous about developing Dakhla as this huge connector to West Africa was Mauritania because that would compete with its own port resource infrastructure that they were offering to some of the landlocked countries.
But Mauritania has changed its position and now seems to be quite supportive of Morocco's plans.
That was Intisar Fakhir, senior fellow at the Middle East Institute in Washington.
You're listening to World Business Report with Andrew Peech here on the BBC World Service.
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If you've just joined us, we're awaiting Donald Trump at a news conference from the White House about a deal the US has done with the UK about reducing tariffs.
More to come if you stay with us.
First though, one of the biggest shipping companies in the world, Mayisk, says he's expecting disruption in the Red Sea to continue for the rest of the year.
That's despite comments from the US President that the Houthis in Yemen have agreed to stop attacking ships in the Red Sea and therefore that the US would stop bombing the Houthis who are backed by Iran.
Jon Stewart is head of the Marine Department at the International Chamber of Shipping.
The Houthis started attacking merchant shipping in November 2023 on grounds that they were supporting the Palestinians in Gaza.
these were completely unprovoked attacks against innocent merchant ships the last time we saw this sort of kinetic threat to merchant shipping was the Tank Awards in the 1980s and it had a profound effect it has cost seafarers their lives and is resulted in significant diversions of merchant shipping away from the Red Sea and Suez and around the Cape of Good Hope yeah and tell me what normally is shipped through the Red Sea because it's such a huge route?
It's all goods. So all types of shipping will typically traverse those waters.
You're looking at around 40 % of Asia Europe trade.
It's about 30 % of all container shipping that would normally go through the Red Sea and the Suez Canal.
But in terms of commodities, it's everything you can think of from oil to grain to other bulk cargos, steel ores, to containers, the products that we rely on in our daily lives to market in Europe and Asia.
This is going to be difficult but is there any way of putting a figure on how much it's cost to have this shipping lane under attack with routes disrupted, sometimes routes diverted?
The remarkable thing is that actually the economic cost has been minimized by the resilience of the shipping industry.
So I think a lot of experts at the start of the crisis, ourselves included, expected to see a knock -on effect in the markets that were normally serviced by that route.
What we found actually was that excess capacity in the container fleet meant that the route around the Cape of Good Hope could easily absorb the excess costs.
So we've not seen a knock -on economic impact mercifully from the ongoing crisis.
And are carriers desperate to get back then to using this shipping lane with the risks that it carries or are they perfectly happy?
There is a risk balance that needs to be struck.
The principal concern of all shipping lines that would normally traverse these waters is the safety of their vessels and their crews.
And that's why it's essential that these voyages are threat assessed.
I would expect were the ceasefire to endure that shipping lines would go back to using the Red Sea Route, and because it's significantly shorter, you are adding around two weeks transit time by going around the Cape to a voyage that would normally be a matter of hours by going through Suez, not least it would reduce bunker costs, which are significant from taking the Cape route.
And now we've had this announcement from Washington that the US is going to cease its strikes on the Houthis in Yemen.
What difference is that going to make?
For the time being it's unclear what the impact of this ceasefire will be.
Obviously we've had the ceasefire that was declared on the 19th of January by the Houthis.
The impact of that was that we did see a slight uptick in traffic through the Red Sea, but nothing major, the trends that we've seen over the past 14 months in terms of traffic flows through the region have continued, not least because we don't know what targeting criteria the Houthis will apply following the ceasefire.
Whilst obviously it's welcome that it is conditional.
They've said they will continue their campaign against Israel and their definition of Israeli -linked shipping has over the course of this crisis been quite broad and amorphous.
So it's really not clear whether ships returning to that region would be targeted or not.
And I think it will take some time as a consequence of that lack of clarity before we see significant numbers of ships going through those routes again.
As well as the fact that many of the ships that are now voyaging round the Cape of Good Hope will be on agreed charter parties that they cannot diverge from.
I see. So I mean, the Houthis saying, we're going to stop attacking the ships.
The Americans saying, we're going to stop attacking the Houthis, is all very well.
It sounds like perhaps no one really believes it, but even if they did believe it, suddenly going back to using the shipping lane is easier said than done.
It's not something that can be changed overnight, no, and it will take time for confidence return and it will be conditional on very thorough threat and risk assessments on each voyage and each ship that may be considering going back through those waters in accordance with very well developed industry best practice security guidance, the best management practices maritime security, which were published last month.
And that's John Straupa from the maritime department at the international chamber of shipping on World Business Report.
Right, let's go to the Oval Office now and have a listen to what Donald Trump has just started saying about this agreement between the US and the UK to lower tariffs.
It'll be really great for the UK also.
So they're opening up the country, their country is a little closed.
and we appreciate that.
They'll also be fast -tracking American goods through their customs process so our exports go to a very, very quick form of approval and there won't be any red tape.
Things are going to move very quickly.
Both ways. The final details are being written up in the coming weeks...
Just starting his announcement.
He's sitting at the Resolute desk in the Oval Office and no doubt we'll get a lot of detail now about the deal that's been agreed in questions from journalists as well they were gonna hear from the UK Prime Minister Sakeer Starmer in the next hour or so.
Christa Glystra is director of trade and economic policy at UK Steel one of the sectors of the UK economy really hoping to benefit from what we're gonna hear from the president in the next few minutes.
What do you want him to say Christa?
We were very much hoping for a full exemption from the 25 % tariffs imposed on steel.
It doesn't look like it'll be a full exemption.
I think we're expecting more of a reduction at this point.
And while it's disappointing, obviously, not to get completely free access to the US market.
It would be a step in the right direction and an improvement to what we have been facing since March. The US is our second most important export market for steel following the EU in this particularly high value market.
And so the direct hit on our exports has been a significant blow to the sector particularly at a time when there's numerous other challenges for steel in the UK, not least high energy costs and weak demand.
There's also the secondary impact that we've been seeing on our market, which is, you know, regardless of whether we get a deal or not with the US, the fact that other countries are subject to these tariffs mean that there's a lot of diversion of steel in the UK.
So there's a lot of import pressure.
And so in addition to anything that's announced today, we very much hope that the government will take action to bolster our trade defences.
He's talking about steel right now and saying what an important part of the economy it is in both the UK and the US.
But as far as I can tell, we still don't have the detail of what's being proposed and of course it's going to depend what you compare it to isn't it if you compare it to the regime of tariffs that's in place right now it's going to be a step in the right direction at the very least if you compare it to when there were no tariffs only a few weeks ago it might still seem rather worse that's right and I mean it wasn't like we had no tariffs at all we had a system of tariff rate quotas which is again not completely free trade but yeah, that was a you know, that was a better situation than having kind
of any any tariffs at all.
But I mean, look, we recognize that government has been making efforts to negotiate the seal for quite a long time.
We also recognize that there needs to be two to willing partners for an agreement here.
So, you know, if the government has has tried as much as it could, and that's what it was secure, I mean, we'll welcome but there's a lot of other things the government can do for the steel sector that are entirely within its gift in terms of domestic policy and that's what we'll be focusing on in terms of our work with government going forward. Krista, thank you.
Krista Gleigstra from UK Steel.
We just described the seem to you a little bit because we've got one of those sort of scenarios that could only happen in Donald Trump's White House where Sekia Starmer is now taking part in this announcement but he's on the phone because he's in Birmingham, in the Midlands of the UK, taking part in V -Day commemorative events today.
So he's now addressing this gathering where we see Donald Trump at the Resolute Desk flanked by JB Vance the Vice President and Peter Mandelson, Lord Mandelson who's the UK's ambassador to Washington there.
Keir Starmer addressing the meeting and the journalists there by video link.
James Wickham our reporter is still with me.
We've had, as we expected, a lot of Donald Trump saying the UK is a great ally in front of the queue for this kind of thing, other countries just behind.
We might get deals with them in the coming days.
Do we have any of the detail that Christa is looking for?
Not yet, Andrew, to be honest with you, and I haven't seen any.
I know we're talking about steel.
There has been mention of security as well as part of this, but we are awaiting exactly those details.
The two leaders are still talking, so let's just listen in just for a second to Keir Starmer, the UK Prime Minister.
Almost at the same hour.
and as we were 80 years ago with the UK, the US, standing side by side, I think, is incredibly important that makes this truly historic.
That close relationship has endured over those 80 years.
As you know Donald, when it comes to defense and security and intelligence sharing, of course, there are no two countries that are closer than our two countries, but now we take this into new and important territory by adding trade and the economy to the close -fist of our relationship.
So I think Andrew there you get a sense really of the way that Keir Starmer is speaking very much emphasising that special relationship between the UK and the US.
Donald Trump has said that this deal is good for both countries, so Keir Starmer said it's a really fantastic historic day we await the details.
We're told that it includes beef, ethanol and agricultural products in some way but of course we need the info on all of this.
And Emma Wall from Hargrooves lands down as this, into all this unfold as well.
You said the markets are waiting for detail.
I guess they probably still are.
The S &P 500 and the Russell and the Nasdaq all up on the other side of the pond, up around half percent each. The FTSE 100 is actually down.
I think it's because, as we say, it's waiting for details.
There is rumoured report that actually there will be a carve out for UK autos which should positively impact the UK stock market.
But we'll wait and see.
Thank you very much indeed for that.
Emma Wall from Hargreaves Lansdown.
Thanks to James Wickham as well.
Latest we're getting is that this deal will involve billions of dollars of US exports including things like beef, ethanol and other products.
There will be fast tracking of US goods through UK customs. Stay in touch with us on the live page, bbc .com from me, Andrew Peach and the team here on World Business Report.
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