Heard from the bank of england yesterday and whether that will filter through longer term in terms of negative rates. Now overall, the markets are focusing on that. They are focusing on some of the things that we saw this week, which is m a. In. Ks general in europe edging lower it seems to be that a lot of markets are in a holding pattern. Lets get straight to the bloomberg first word news. Here in london is also leighann gerrans. And oracle seem to be edging closer to eight tiktok deal. They have tentatively agreed to terms with the treasury department. Bytedance is also increasingly confident that plans will win the approval of regulators in beijing. Assuming it happens, a new firm would aim to hold an ipo in about a year. The eus climate chief says rising demand for green bonds creates an opportunity for the bloc. It plans to start selling as much as 225 billion euros of its debt. That amount is almost the same as all of the Green Securities sold globally last year, likely making the eu the largest issuer. As you see organizations like blackrock making this really enormous change into the green economy. If you see them all waiting for us to come out with green bonds because they want to be part of that, i believe this is the moment to do this. Significant hurdles still remain in securing a brexit deal. The European Commission president , ursula von der leyen, has told the Financial Times she is convinced it is possible. The u. K. Said the latest round of informal talks were useful and some limited progress was made. The aim be ratified by the end of the year. Global news 24 hours a day, onair and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. I am leighann gerrans. This is bloomberg. Francine . Francine thank you so much. How do you reshape the worlds Biggest Food Company . When my next guest joined nestle , he already had a reputation as a dealmaker. The company has bought and sold more than 50 businesses since he took over. As part of its ambition to become a Global Leader in food allergy treatments, it also on atly spent 2. 6 billion company that tackles peanut allergies. Joining us is Mark Schneider, chief executive of nestle. Thank you for joining us. If you look at what we have been through, the pandemic and covid19, how does it change the relationship we have with our food . Does it make us want to buy healthier food . What does that mean for nestle Going Forward . Mark good morning and thanks for having me. Face of this pandemic has been changing over haveand Shopping Habits been changing with it. Initially, there was concern about just keeping pantries stocked and we saw a lot of pantry loading, as consumers wanted to make sure that there was enough food supply during the lockdown. Over time, people were gaining confidence that shelves remain stocked and that supply chains were resilient. We also saw quite a bit of initial demand for comfort foods. Clearly, this was a very stressful spring and early summer for many of us. Comfort food was in high demand. At the same time and i think this is now the longer trend playing out, there is a renewed interest in health and nutrition that advances health and strengthens the immune system. I think this is here to stay, certainly throughout the later stages of this pandemic, and we believe also be on that. Francine Mark Schneider, when you look at your unit, health and nutrition, how much can that grow . Will that be one of your best performing but also growing units in the next five years . Healtho our nestle science unit has been on a tear, even before the pandemic. This was a 2 billion swiss franc business. We doubled this we expect to double this by the end of next year. Very strong organic growth, especially in vitamins, minerals, and supplements. On top of that, i think very nice m a opportunities that we utilized over time in healthbased nutrition area. , thisk this acquisition offer here is the latest step in implementing this strategy. This is going to be one of our key Growth Drivers and something we are proud of. Atncine and so, if you look subscriptions in terms of vitamins and things like that, how much will that grow . Are you sing much more demand for products like that online . Will that continue once the pandemic is more dealt with . Mark yes, so this is a category that lends itself to Online Business opportunities. We have seen online demand skyrocketing. This was already, you know, a growing sector before the crisis. It skyrocketed during the crisis because it made shopping so convenient. Youre absolutely right. I think personalized vitamins, minerals, and supplements are going to be the next frontier. We have some very exciting offerings on the way. You are moving away from just straightforward supplements, like what i call the vitamin d. Habet, a, b, c, or you are going to specifically what the certain individual requires. Initially, there is some testing, a questionnaire. Based on that, you get exactly the vitamins, minerals, and supplements that are made for you. Francine as that business is growing, Mark Schneider, does it mean that you will cut down on processed foods . Well, processed food is one of these misunderstood terms. When you cook, you are also processing food. Processing food per se is not good or bad. It depends on what you do to the food. I think overall, there has been a trend and something we have been quite active on to really make sure that our food gets processed in a way that preserves the good and healthy ingredients, and that we are also using what we call Kitchen Cupboard ingredients. And means to simplify ensure that these ingredients are healthful and have a good track record. Francine a lot of the focus from the government is on fighting obesity. That includes certain advertising things when it comes to highfat or high sugar content. What does that mean for certain nestle products in the u. K. . Will you have to change them . What kind of conversations are you having with the u. K. Government about . Mark about it . Mark yes, so we have been working very closely with the u. K. Government. To me, transparency is step one. We were all across europe, including u. K. , we were in the forefront when it comes to Food Labeling and absolute transparency. People should be knowing exactly what they eat and what the ingredients are and what the calorie count. Is and then of course, we are also a leader when it comes to restrictions, when it comes to marketing to children. Overall Going Forward, informed choices to me is key. When it comes to food and beverage, its one thing to have a very healthy offering and you can count on us to have the nr line. Clearly to have that in our lineup. Clearly, indulgent products are here to stay. You allow people to make an informed choice and nudge people towards a more responsible use of the more indulgent products. Francine Mark Schneider, when you look at some of the trends we have talking about for the last five years, there was a concern that it was i guess the smaller local brands that could have gotten market share from companies such as nestle and some of your rivals. Does the pandemic actually reverse that trend . Because you have much better distribution, your accessible in certain places and have also that online capacity. During the pandemic, one phenomenon we have seen globally is that with consumers, there is a renewed interest in large, trusted brands. This is nothing new. I think this also happened in earlier crisis. People want to go back to choices that they know, that they trust, and that they know insideout. This crisis is no different. We have seen the same in 2008, 2009. Before that, i think we already have been able to slow down the onslaught of small to Midsized Companies in our space simply by becoming more innovative. I think what happened here, when you look back at the last five years, Smaller Companies were taking share from us because they work faster in addressing consumer needs. We have stepped up significantly our own innovation pipeline, and time to market has been shortened dramatically. Even before the pandemic, i think we were able to slow down the loss in market share to some of the small to midsize players. Francine Mark Schneider, thank you so much, from nestle, hes the chief executive. He stays with us. We have a lot to talk about. Coming up, well talk more about the future of the worlds Biggest Food Company with our exclusive interview with the nestle chief executive. Thats next and this is bloomberg. Francine economics, finance, politics. This is bloomberg surveillance. Im Francine Lacqua here in london. Still with us, Mark Schneider from nestle. We were talking a bit before about some of the shift to more health and consumer habits. I was not aware come about nestle i was not aware, but nestle reminded me of National Cheeseburger date. If we speak to you again in five years, how much of your revenue will be from plantbased foods . Have not given precise revenue guidance but we clearly indicated that this is an area that is strongly growing, strong, significant doubledigit growth rates for several years now. I think this notion of plantbased alternatives to meat and poultry and dairy and fish products, that has a huge runway ahead of itself. I think it addresses two key themes. One is consumers interest in healthier diets, and of course, environmental concerns. The environmental footprint of plantbased offerings is so much better. Francine we talked a little bit before about the high sugar content products that the industry has. What will happen to your confectionery unit . Do you think it still has a place for nestle . Or will it be completely overhauled or reduced in the next couple of years . We believe in the future and promise of our confectionery business. I believe we have taken Great Strides in proving that improving that. Having said that, even though it is confectionery, you can add healthier offerings. For example, our yes snacking bards. You can also go to more premium offerings and smaller portion sizes. I think there is more growth opportunities. Confectionery and chocolate address a deep human need and will be here tuesday. Its more about having a responsible will be here to stay. Its more about having a responsible offering. Francine there has been concerned about some of the coffees and cocoa beans actually being harvested by children. I know you have taken steps to try and change that, or at least for some of your offerings. Does that have an impact on consumers . Do consumers now want to make sure where these things are sourced so that no harm is done to any child . This is a huge issue. Let me be very clear, child labor hasin our supply chain. Has no area that this is an area that has no a space in our supply chains. We have taken steps to make sure that child labor is not in those supply chains. For all the controls we do, violations will continue to occur. Its all about how vigilant you are about those and how stringent you are in your response. This has no place in our supply chain. Francine talk to me a little bit about some of the trade tensions out there. We can talk about brexit, the u. S. China trade tensions, doesnt actually change your supply change does it actually change your supply chains . Mark specifically when it comes to the end of the year, we recognize we have a primary responsibility to the u. K. Consumer. As a result of that, of course we are increasing our stock levels to be sure that even if its a choppy departure, that we leave clearly the consumer well supplied, the shelves are stocked. Thats a very important theme for us. Generally around the world, i think with some of these trade tensions and geopolitical developments going on, you will see over time a slight shortening of the supply chains. I think long, complicated, Global Supply chains are getting increasingly exposed. As it happened with nestle, at a time when these long, complicated supply chains were very much in fashion and all the rage, we never went all the way. Overis date, we operate 400 manufacturing facilities around the globe. We are taking pride in actually having a stronger local commitment, and mostly making products wherever we can in the markets where we sell. As a result of that, we feel somewhat less exposed. But even with the setup we have, we need to carefully check that we are not getting exposed here as either the pandemic or some geopolitical develop put pressure on Us Developments put pressure on us. Francine what can you tell me about Climate Change . Efforts will probably have to be redoubled even more in combating Climate Change and making sure a lot of the packaging is sustainable. What are you most excited about in terms of packaging that can actually be recycled more or biodegradable . I think at this early stage, its important to leave no stone unturned, so whether its biodegradable, paperbased products, or whether it is the advancement of recycling, or reuse systems, for that matter, that avoid waste to begin with. We have to try everything. There is not one silver bullet. I think what you will be seeing a few years from now is not onesizefitsall solution, but rather, something tailored to specific markets and climates. In a hot and humid climate or when you have longest distance, reuse systems may be harder to install. This is where the hygiene that comes from packaging helps with food safety. In some other markets where there is more population density and where the claim is more moderate, i think reuse systems will have an Important Role to play. What we are working on with our institute of Packaging Sciences by the way, we are the only company that runs an institute of Packaging Sciences. We are trying to find the right choice for the right environment. Francine Mark Schneider, thank you so much for the time you give us today. We hope to see you very soon. Game over. Will the trump the Trump Administration asks Gaming Companies to provide information about their Data Security involving china giant tencent. We will talk a lot about that next. This is bloomberg. Francine this is bloomberg surveillance. Im Francine Lacqua here in london. Lets get the latest on the u. S. China tensions over technology. Bloomberg understands that washington has asked Gaming Companies linked to chinese giant tencent to provide information about Data Security. This comes as bytedance is getting more confident that its deal with oracle will get the approval of chinese regulars. Lets speak to jody she regulators. Lets talk to jodi schneider. Why is the administration asking Gaming Companies to provide information about their security data . This is the committee on Foreign Investment the u. S. , which investigates foreign acquisitions of american businesses for National Security risk. It has the authority to examine acquisitions, as well as noncontrolling investments, and recommend that the president block or unwind deals. This builds on the Trump Administrations heightened security of Chinese Companies and their ties to u. S. Firms. Tencent, the Worlds Largest gaming company, owns Los Angelesbased riot and has a 40 stake in epic. Both of those companies have been asked to provide this information about their security protocols in handling american personal data. It looks like this is based on that. Whether there is any data that is being compromised. This is coming as President Trump is using this in his increasingly tense rhetoric about china as part of his reelection campaign. Francine what is the latest with oracletik tok deal . Company that new bytedance plans to form with oracle, first of all, it intends to hold an initial Public Offering in about a year. It will be called tik tok global. The result of this transaction forced by President Trump last month. We are also hearing that moreance is getting confident that this Alliance Pass with china regulators. China has the right to block the deal if it does not like it. You would have regulatory concerns as well. This looks like that it is kind of a heading, at least somewhat, toward the finish line that chinese regulators will sign off. Francine coming up, we will focus more on Central Banks. This is bloomberg. You can go your own way go your own way your wireless. Your rules. Only Xfinity Mobile lets you choose shared data, unlimited or a mix of each. And switch anytime so you only pay for the data you need. Switch and save up to 400 a year on your wireless bill. With the carrier rated 1 in customer satisfaction. Call, click, or visit your local xfinity store today. Francine economics, finance, politics. This is bloomberg surveillance. Im Francine Lacqua, here in london. Lets get to bloomberg first word news with leighann gerrans. Isghann saudi arabia showing its determination to protect the oil recovery. It is warning not to challenge its result. Abdulaziz bin salman delivered a rebuke to an ally overproducing. The uae has made 10 of cuts in august. Global Coronavirus Infections have exceeded 30 million. The u. S. , india, and brazil are still the countries with the highest number of cases. The World Health Organization is warning of a resurgence in europe, calling the recent slide a wakeup call. France has reportedly know you the most daily cases since they locked down in may. The cmas lodging contracts based on californias up a water supply. The First Security of its kind in the u. S. And africa of asia also have potential problems. Cme says two thirds of the worlds population could face water shortages by 2025. Global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more im 120 countries, leighann gerrans. This is bloomberg. Central banks have been in focus these past days, not least jay powell. He signaled u. S. Rates would stay near zero for at least three years. Is a look at what he and others around the world have said this week. The race will remain highly accommodative until the economy as far along in its recovery. Remaining below but close to 2020. Dpoint in 2021 and with inflation running below 2 , we will aim to achieve inflation moderately below 2 for some time. Longerterm Inflation Expectation remains well anchored at 2 . Japans economy has started to pick up with Economic Activity resuming gradually. Although it has remained in a severe impact of the novel coronaviruss home and abroad. Strong policythe guidance will serve the economy well, through whatever possible paths the recovery may take. Francine that was fed chair jay powell and other central bankers speaking this week. Joining us now is the chief Investment Officer at ubs, mark haefele. The fact that the fed has changed and given us more insight into how they look at inflation but also giving themselves more flexibility, how does that move Asset Classes . Mark i think it has been a huge stimulus over the summer, and if you look out. This combination of centralbank action and all the digital newds, they point to this normal, which is really stimulated new normal, which is digital and a lot more stimulative to the system, and that fuels prices in particular in the tech stocks. The next question is when do we get more normal. When do people get to go back into restaurants and start flying on planes . That is what the markets will be focused on this fall. We ever get back to where we were in 2019, or will it gradually be more normal . What kind of scarring does that due to the economies, and for Central Banks . Get to al, we will more normal state. Of ay take the adoption vaccine, but those things are on the horizon. Whether they are one quarter away, two quarters away, three quarters away, four quarters away, that is what people are wrestling with. Some of the things that are part is morenew more normal normal political environment in the united states, better understanding of what is going on with the vaccine, and then some understanding of how the stimulus payments in various countries are going to play out. Where do you see the biggest opportunities . If you look at the rally and what is happening in tech, is it frothy, overvalued . Or is there some room to run . Mark over the near term, the evaluations are pretty full, but it is certainly not above 25 times, it is not a key rishi a a ap ratio with 17 it is not it is not a p ratio with 17 . Having a more optimistic picture that we are going to get more normal, i think we are looking at opportunities for clients to take some rotation away from large cap tech, maybe move it to some other areas of tech that can see growth, whether it is the 5g build in asia, whether it is cybersecurity. That is one way to play it. Another way is to look at the more cyclical stocks. The u. K. Indexes more cyclical, or midcaps in the united states, which have not done as well. Are you expecting tensions to rise in the u. S. And china . Because there is an appetite for democrats but also republicans in the u. S. Come as we have seen with the Trump Administration, iseep the fire on china there wary things will escalate and that will move the markets quite significantly . Mark we are not anticipating an escalation in the trade war between now and the election. So economically, i think things are going to be relatively smooth there. China has rebounded extremely well from covid. It is a true vshaped recovery. As far as tensions go over time, bothare high, and administrations, whatever plays to, you know, make americas points no. Known, andas points they may do it in different ways. It will be a constant through the election and into next year. Francine what happens if we dont get a vaccine, mark . What is priced into is a vaccine by the end of the year pressed into the markets priced into the markets . Mark i dont think that a is fully priced in at this point. When we say we dont get a vaccine, there are vaccines that are already deployed in china, degree, somited eventually we will get a vaccine. But i think what the tricky part here is this combination of what you mentioned at the beginning about the fed, stimulus, and then when the vaccine comes, because it is very hard for the Central Banks to take additional actions now if a vaccine is announced very isn, or further stimulus taken very soon because putting on a policy in front of that with the lag effect could leave them in a worse position than if they had just waited a little longer. So i think thats why this period before we get the vaccine announced i think we are having a couple of connection issues with mark haefele. He was talking about what is priced in and what happens if it doesnt, if we dont get a vaccine in the next 12 to 18 months. Haefele, chiefk executive officer. We discuss next with Patricia Obonai. This is bloomberg. Francine this is bloomberg surveillance. Im Francine Lacqua in london. Lets get to the Bloomberg Business flash with leighann gerrans. Leighann Goldman Sachs has become the latest bank to send traders back home. Bloomberg sources say that is after at least one employee tested positive for coronavirus. The lender is moving forward someplans to is telling staffers to plan for week shifts starting in october. Sources have told bloomberg that the covestro has been contacted within recent weeks. Its market value is around 8. 2 billion euros. We are told that discussions are at an early stage, so no official comment as of yet. Exclusivehe is in talks with the deal also includes italys state back tessa san and o paulo. Italy has been working for months to bring the Stock Exchange back into italian hands. That is your Bloomberg Business flash. Global coronavirus cases top 30 million, the World Health Organization warning of a resurgence. Health experts warned that the number of cases is much higher. How has the pandemic affected the telecom industry, and what have chief executives learned . Earning us now is Patricia Obonai of vodafone. Thank you for joining us today on bloomberg surveillance. Let me start off with some of the things we are seeing in ghana today. We understand that your main competitor, mtn, was designated as a dominant player in june. What does that mean for vodafone . Can you significantly increase market share . Patricia well, for us, the law fors position provision a level Playing Field in the country. While we dont have any major objections, as long as the are held to the consumer, it is similar to we are very open to it. Economy ghanas contracted because of the pandemic, but if you look at services five telecom, it has increased. Services for telecom, it has increased. How has it affected your demand for services . There is increased market for construction and conductivity. Also systems like health and education, and making sure that that is what is important. Journey for on the cyclical adoption, but today we have seen a significant increase october he in in opportunity. Digitalto increase more to deliver Financial Services the platform. Seen a 40 increase in mobile access customers. It is the best way to spend money. Francine has the pandemic changed priorities for government in terms of Infrastructure Spending in the Telecom Services industry . Patricia i mean, this is significant. What the government did immediately was to support the telecom industry. As long as people continue to there is a greater need for mobile phones, and one of the things that the government has announced is to provide access to fiber in the communities in the schools as well. Francine when you look at vodafone recently bringing vodafone under the telecom umbrella, what does it mean for your operations in ghana . Does it change the way you operate Going Forward . It has not change with haveholders, however, we lendings other africa markets we have lending from other africa markets. So we have to capitalize on intel. Francine thank you for joining us today. Patricia obonai of vodafone ghana. Americase look at income inequality and how the pandemic has widened the gap. This is bloomberg. Inequality, which i would point to as a multifaceted thing, i would point to the stagnation at the lower income of the implement spectrum, and also upper mobility. Those things hold back the economy. We dont have the tools to address those. When we lower the federal funds rate, that supports the economy across a broad range of activities, but we dont have the ability to target particular groups. Notwithstanding that, we talk about it because these are the important features of our economy, and i think those distributional issues are issues that are really for our elected officials. That was fed chair Jerome Powell saying that inequality and the economy needs to be addressed at politicians and not the fed. Today we are looking at income inequality in the u. S. Bloomberg now is our quicktake reporter. The pandemichas influence income inequality . Jennifer we are six months in, and it really has exacerbated inequality not just among racial lines, but across economic, social, and gender lines. One professor called it the k ship recovery the k shapes recovery. Back in the spring at the height of the pandemic, the stimulus went out and the travel benefits helped ease the blow for Many Americans with loss of jobs or have declining incomes, and it also helped with Consumer Spending because people were spending more time shopping online at home. But when that ran out back in lowest wage workers, many of them hardest hit come out of jobs. At the same time, the wealthiest americans, who have been able to stay home and work from home throughout the pandemic, have only become wealthier. I read a progressive think tank report that found that of the jobs,ans who lost their the wealthiest americans gamed 845 billion. Are hearing more and more ultimately come chairman powell said, it comes down to policy, and lawmakers on capitol hill are still at a stalemate over what stimulus they will pass. It remains to be seen over the next few weeks before they break before the election, how they are going to aid americans who are still struggling. Francine when you break it down by race, it is also even more troubling. Addition,yeah, so in minorities have a higher risk of seriously falling ill from blacks are taking a bigger hit. The most glaring financial facing, payingre rent, credit card payments. Difficulty forwarding difficulty affording even food. There is also a poverty divide. 18. 8 of black americans report living in part ready living , compared to 7 of white americans. Theier this week during town hall, the gains made by African Americans in the past 10 years have really been wiped out during this pandemic. Now black unemployment is almost double that of white americans. So as this became essential issue for the democrats during the primaries, it is definitely going to be a central focus now in the general election. Joe bidentrump and would have to address it especially with more of the electorate falling into these categories and really, like i was mentioning, struggling and looking for answers. Francine thank you so much. Jennifer zabasajja there. You can catch her weekly show, your world, every sunday, at 6 00 p. M. London time. A key ally of Angela Merkel is see an are unlikely to abrupt shift in policy. This will be a transition. It will of course bring changes to the party. Thanksshape parties, but to Angela Merkel, the cdu is so rooted in the middle, i have no doubt that in a time when Angela Merkel is no longer holding this responsibility, that the cdu will still be on this course. Lesha isge from armand correct, that the course is clearly in the shortest position. 36 is certainly not nothing, and this is a particularly good result in a logo election where the splintering of parties is greater on various levels. This is an absolute affirmation of this political direction, and i think that we shouldnt doubt the centrist line. So this is the confirmation of the political line and signals schet stance. A he is a different sort of politician, much clearer then perhaps is the case under Angela Merkel, but from a political position, where he would like the cd to lead the cdu is without a doubt the person who stands most clearly for the political center. That was daniel bloomberg. Aking with bloomberg surveillance continues in the next hour. Tom keene joins me out of new york, and a little bit later, dont miss our conversation with fed president rough l bostick. U. S. Futures are mixed. This is as investors are settling according to a couple of market analysts into a holding pattern. Catalyst for a they are waiting for a with brexit. The dollar little changed after the gyrations that we saw thursday. If you look at some of the things that are moving in europe, im looking at the industriescyclical including travel and real straight real estate are the biggest followers, and then we big day when it comes to banks. Of the other things im watching out for, gold. Gold climbing, crude oil trading higher, about 41 a barrel, and is up some 10 this week. More bloomberg surveillance coming your way. This is bloomberg. Francine game over. The Trump Administration asks Gaming Companies to provide information about their Data Security involving china giant tencent. Back to the kitchen table. Goldman sachs is the latest bank to send some traders home after an employee tested positive in its manhattan headquarters. Cable holds that 1. 29. The u. K. Found a note of optimism. This is bloomberg surveillance. In london,e lacqua tom keene is in new york. A lot of people expect a catalyst, and that could come on the political front because we have quite a lot going on with the u. S. And china. There is also Great Research being written off the fed meetings, and i would really go to a brilliant note this morning by kit juckes, who sets up the british distinction, and he says, you know what, this is in europe. Really important
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