anna: very good morning, this is "bloomberg daybreak: europe." we're live at the economic form in davos. francine lacqua joins us bright and early from davos. francine: good morning. on thef focus will be tariffs that the trump administration has imposed. we are trying to get to the bottom of the chinese allegations. the biggest, the person that makes the most of solar panels is here in davos. later today we will focus on banking. the blackrock vice-chairman will be joining us. we are looking forward to that interview because it is about trade. we haven't all-star panel talking about the future of finance. andprime minister of canada india speak. theresa may and donald trump on friday. anna: it will be a packed lineup. thank you very much. we will return to francine shortly for our first interview. let's get the markets. this is what has been happening over in asia while you have been sleeping. msci asia-pacific, up 0.8%. new highs for these asian equity markets. concerns, focusing instead on the corporate earnings story, the global growth story. futures, the end of the shutdown has lifted markets. it did not impact markets unduly. much from the boj. there has been a tweak around inflation. manus: sterling is moving. is it the dollar weakness story? there is a suggestion of a risk of a pullback. is as long as it has been since 2015. way before the brexit vote, the market is most bullish on sterling since august, 2015. the two-year government bond yields, you can see a second nice to move -- synchronized move. do you want to fade this move? risk is a non-negligible in a pullback in cable. they say you will get a pullback. cap out at 144 the moment. as you are waking up in davos, this is juliette saly in singapore. juliette: a lot warmer here. donald trump has slacked tariffs on imported solar panels and washing machines, angering trade partners. dutyca will impose a new of as much as 30% on solar equipment foreign-made. asiffs will start as high 50%. china and south korea condemned the steps. aging calls it a misuse of trade. donald trump assigned a spending bill that ends the shutdown. senate democrats accepted a deal from senate leader majority leader mitch mcconnell that will fund the government through february 8. the bank of japan has maintained its massive monetary stimulus program and kept its price in economic forecasts unchanged. in a small sign of progress, expectations have stopped falling. some are reading the language about inflation -- global news, 24 hours a day, powered by 2700 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . on the markets in asia. another record high. we're seeing japan closing out the session up by 1.3%. no change in the boj decision. continuess hang seng at record highs. australian markets strip -- snapped its worse losing streak in four months. 1.14%.pi is up by despite the tariffs. it has been fluctuating in late trade. display up by 6%. this is positive news in upgrades. anna: juliette saly there in singapore. the world's economic form and gets underway today. throughout the week more than 400 sessions will be held with intending to improve life across the globe. you talk about a fractured world, we can see it over the last 24 hours with the announcement by donald trump that he will impose tariffs. a lot of the talks will be about that. and the chinese delegations reaction. offfirst interview to kick the world economic forum, thank you so much. welcome to davos. it will be busy. what will be your main theme today? it seems growth is back. your company is doing ok. are you worried about protectionism? >> we are entering 2018 with a lot of optimism from all the places and parts of the world. it is the first time i am i see such a, positive environment everywhere. i think it is important to work on the potential issues so we can keep this optimism going. protectionism is one for sure. i would say for a businesslike us, we are probably helping manufacturers in some part of the world. basically protectionism is not a good thing to apply in this world for open trade. is the growth we are seeing creating jobs? in a lot of countries, creating jobs. we are at the lowest unemployment level since 2007. we are back at the figures of 2007, and it should continue to go down. positive for unemployment on average. youth in employment is still high. put out a report looking at different labor forces, what they need, the age groups. was surprise you the most when you put this together? point is thatg the winners being countries or cities are the ones able to develop a good education system. very important. and coupled with a education system, a strong relationship with business so there is an alignment with what the business needs in terms of competence and skills, and what education is providing. and all of that facilitated by a government and it regulatory environment. the first time in many years, switzerland is the first country, and zurich is the most attractive city regarding attraction of talent. it also demonstrates the countries and cities with high income are also the most successful in doing this. francine: you are the world's biggest staffing company, and when we talk about economics, we talk about there is a lack of inflation and wage growth, and that is putting in question the sustainability of this growth trend. pressures?price do the people you put in jobs want to be paid more? we see limited price pressure in some countries. the u.s. is one. germany is the other. inflation,ee a huge it is inflation between two and 4%. -- let's not forget in many countries we have quite high unemployment. at the state we do not see inflation rising fast. francine: do you expect the tariffs to impact how you do business? >> there will be an increase of see., and we will you die side some -- you decide something politically, but in the long run we should see inflation. francine: is brexit ok? >> brexit is ok. with the knowledge today, we do not see an impact on manufacturing activities. , and customerst everybody is waiting for clarity. we have 15 world leaders and 400 panel sessions. we talk about blockchain. what are you most looking forward to? in a very positive environment. we have no time to work on the structural issues like youth in employment. how we tackle this, having reduce unemployment in the world. francine: thank you for helping us kickoff the davos coverage. back to you in london. francine, thank you very much. good luck with davos 2018. more to come. anna: a little later in the we will be joined by the first interview of the day from doubles. this is bloomberg. ♪ ♪ it is 7:16 a.m. in davos. let's get straight to the slopes with francine lacqua. francine: i'm pleased to be joined here in the first interview of the day for him. we have a lot to talk about. we will be away from the yesterdayts, with tariffs on solar panels and washing machines. good morning. thank you for joining us so early in freezing davos. it seems there is a wave of optimism in davos. growth is ok. bank of england is ok. life for you will get easier, then president trump says he will slap some tariffs. are used concern we will go into a stage of protectionism? >> when i think about the walls of snow, and risk everywhere. finemies are doing everywhere. in most countries at least. the imf has revised its forecasts. we all know there will be decisions which could slow down the economy. is not good for trade and growth in the world. francine: if you look at the there is an increase in interest rates that will impact the markets. what you worry about the most? >> for the europe p.m. banking -- for the european banking sector, with this kind of growth, we should see the beginning of monetary policies, it is difficult for us to manage. growth is good for banks. it means good credit flows, and we are focusing on the end of the regulatory agenda. , the world isc fractured, but at the same time at the eurozone level, there is a project to further integrate. we have years that are slow sometimes maybe, but i am optimistic for us. --ncine: we may have less banks in the eurozone. this is something that will take time. 9 there is a lot to do. francine: when you look at your challenges are you speaking to u.s. authorities? nothing has changed fundamentally there. when you look at the challenges of european banking system, do you think consolidation will come when the regulators have an appetite for mergers? >> the whole framework means the bigger you are, the more complex, the more significant amount of capital you have to have. benefit of thee european banking union. the flows of money between two countries in the eurozone is a source of complexity. we don'time being, have the benefits of the new constructions. banks, whether there are more synergies, the markets will and we willgrated, have some benefits of this new framework. francine: will 2018 be the year we say european banks are losing out to u.s. banks? it seems the investment banks in the u.s. are eating our lunch. >> i am positive. i do not believe in a world were investment banking is concentrated in five u.s. banks. the amount of risk in the system would mean over concentration. clients do not want that either. it is a world where in each region, five or six big players, and they will connect so that companies can have between 10 and 15 core banks so that large investment firms can have 10 providers of services, liquidity, etc.. i am optimistic in the long-term. it might take some some time. go,cine: how did mifid ii and how is brexit going? worried, it did not happen at all. with the introduction of the new regulation, brexit same thing. about the divorce settlement. i would say negotiations are around the new relationship. in 2018 it will have less impact. francine: are you moving anything elsewhere? >> we have a presence on both sides of the channel. systems,eople building a relationship with the regulators. , if weess significant have to choose another country, and have a relationship with a new regulator, find the building , we do not have to do this. francine: how much do you think about bitcoin? >> we have just announced a new on technology. i believe in this kind of technology to improve banking processes, which can be very old . they will be much more efficient. i believe in that technology. can i say i am skeptical around bitcoin. i can think about cryptocurrency but withward, institutional players using them, it is a long-term play. i think it is a very risky bet. see ane: do you cryptocurrency regulated by g20 levels? at some point. with players needing to check where the money goes, from where it comes from, we all know the government regulators want to be against moneyt laundering, terrorism, i can't imagine something that is too anonymous. francine: do you worry about hacking? to be sure we have the right strategy, to deal with this threat. = : does the french momentum impact your share price? directly, but it contributes to create positivity, momentum, and optimism. ceos, theh a lot of feedback is positive on france. -- i think reforms implemented by macron, they have contributed to positive momentum. i am very optimistic. francine: thank you very much for joining us. that was the chief executive officer. throughout the day we will be speaking to plenty more banking ceos. we have a panel led by tom keene. anna: the canadian prime minister is also speaking today. lots to look forward to on day one. coming up, we will have more from davos. ♪ manus: it is 6:30 a.m. in london. it is 7:30 a.m. in davos. presidents, prime ministers are waking up. they gather around for a global huddle. equity traders are pushing equities higher in asia. the msci asia pacific index headed for a record close. japan,n china, gains in and korea, and on the hangs , and in -- hang seng australia. president trump will be slapping tariffs on washing machines and solar panels. lg initially before trading giving as much as 5%, way to a rally to recoup those losses. investors are shrugging it off. looking closely at the boj. we are seeing a little bit of yen strength. this is after stimulus was unchanged. the boj pointed to improving inflation prospects. we will be listening closely to kuroda. this chart shows how investors in the yen seem to have different perceptions of whether there will be tapering in 2018. prices, this is to decrease for attempt week. you, nejra cehic. we are monitoring what is going on in tokyo. kuroda is giving a press conference, as is the custom. we will be back in japan shortly. thes already saying japanese economy will continue growing. depressed for the next few years, according to the head of canada's biggest pension fund. if you look at underlying economic performance and strength, europe is coming out of depression. japan is steadily growing. china has robust growth in the last year and seems to be continuing. canada is strong. wherever you look in the world, growth is robust. we have a synchronized upswing. unexpected stimulus is coming on top of that. cuts, potential and production plans in the u.s.. there is a lot of push. markets are justified in pricing that in. the question is, what happened to inflation? are people being complacent about inflation. will you have a drag on returns it inflation rears its head and we enter a bond bear market? >> yes, there will be a bond selloff. it will also have an effect on assets and interest rates. the real estate portfolio we have, the infrastructure portfolio we have. , we wouldthing probably be more concerned about that then we should have been. we have been concerned for the last five years. we have had a top of the house tilt on anticipating rate rises in the u.s. they are barely coming through. >> does that suggest you are a couple -- comfortable with how you are allocated now? do you need to selloff some of the bond portfolios? us, we are super long-term. we are measured over a 75 year time frame. upfront has to be sustainable for 75 years. quarter for us, we like to say is 25 years, not three months. that short move we probably will not respond to. isn't, andmultiyear we see a rise in inflation, we will have to look at that and respond accordingly. .ut we are equity heavy that means most of the rest of it is equity like exposure. it ultimately, the diversification around the world , and one of the diversification's we are pushing is emerging market exposure. we are 50% today, but that will go up. >> where do you think you should be? >> in about five years half of the world will come from emerging gdp markets. towill not move from 15% 50%, but you can see a long-term trajectory. what holds you back is the available public market, particularly in china. but we are going to move up. long-term, we are at about 5% in china, we are close to 40% in the u.s.. sometime in 2026 that will switch. huge wave fora that in the long-term. >> based on the way you see things today, is the outlook for better or worse than your five year average? >> given where asset prices are now, it is unlikely we can expect a very high asset price .eturns over the next two years i think they will be quite depressed. machin,hat was mark ceo cppib. the governor of the bank of japan is pushing back. he wants no noise in terms of movement from the bank of japan. the bank of japan is not at a states to consider an exit. japan's economy needs persistent monetary easing. there is still a distance from the 2% price target. there was a little dissent. this goes back to the wording of the bank of japan. the risk to prices remain skewed to the downside. let's try to put this in perspective. we are joined from tokyo. this is clearly a push back, yen is now falling. green, 110.94. absolutely, and i think that was to be expected. the reaction to what the boj had to say today. announcementay's as boring as possible given what the market expectations are. the only change was us white -- was a slight tweak to the language. to inflationange expectations, the boj unexpectedly cut the size of bond -- the expectations they are getting ready, have been bojeasing is something the is not ready to deal with. i was not surprised to see kuroda pushed back on those expectations. the markets are very sensitive ,o any small sign of progress even the small sign they make today. anna: pushback from the governor of the bank of japan around what they are doing in the stock market. he said he happened to observe excessive expectations in the stock market. to adjust etf purchases. with all of this pushback from kuroda, what is the outlook for the rest of 2018? >> exactly. he will be asked about that before the end of this press conference today. he does not appointed not have much time left. his current term expires in april. we would expect to be hearing in the near future some rumblings if he is not going to be reappointed. the outlook for the rest of the year is one question mark hanging over things. they seem divided on whether the boj will normalize policy or will tighten policy. the economists we surveyed were .venly split on that in the near-term, we expect to see kuroda and lots of opportunities for him to talk. anna: thank you. kuroda not at the point to push policy exit. let's get to one of our other big stories. it is a global story. president trump has dealt a giant blow to the renewable energy industry, slapping tariffs on imported solar panels. that areed up to 30% exported elsewhere into the united states. , bloomberg's top asia editor joins us from hong kong. and some of the american allies, why are they calling these rejectionist moves? what is it about them they do not like? jodi: the tariffs are high. are asar equipment, they much as 30%. on washing machines, the tariffs go up to 50%. they weren't necessarily expecting this at this point. president trump ran on an america first campaign, and throughout his first year in office has talked a lot about trying to do something to combat unfair thinks are foreign trade practices. he has not taken much action. china currencyl manipulators as he did on the campaign trail. these are the toughest moves yet. they were not expected. there was some expectation about tariffs on aluminum. the trade allies were caught surprised, and people like south , which are allies but could be hurt by this, and had strong things to say in reaction today. manus: these tariffs were were lower, they than those recommended by the trade commission back in october. they recommended 35%. and they did taper. moment another bellicose on tariffs from trump as he prepares to go to davos? what has the reaction been on this? jodi: i think you are right. they could have been tougher, and some are saying that. people are saying there may not be much affect, certainly not immediately. it is a political move coming off of this three date government shutdown where president trump was trying to blame the democrats and make it about politics. he is trying to make a statement before he goes to davos. it is an election year, a congressional election year, and he wants to make good on campaign promises. .his will go well with his base whether it has a larger economic effect is still in question. there could be other moves like this. this could just be the first of these kinds of detection is him moves. -- kinds of protectionism moves. manus: coming up, we will go back to davis -- back to davos. later we will be speaking to blackrock's vice chair. he is joining us for his first interview for the day. they are joining us on the slopes in davos. a lot of snow on the ground. live pictures of the beautiful snowy landscape. set. may be new records a lot of concern on the slopes. this is bloomberg. ♪ ♪ anna: this isanna: "bloomberg daybreak: europe." the global elite are waking up in davos. the trump administration slapped tariffs on solar panels and washing machines. kuroda says there is no need to consider policy exit. no need to change the 2% target. dampenthey just want to down any expectations. meantime, let's get a bit of perspective on that part of the world. ceo joining usa on the slopes of davos for his first interview of the day. good morning from sally davos. we talk about oil at $64. it means a $1 billion loss globally. you are a married man, congratulations. $64 a barrel,t what do you make of the impact on airlines? >> i think air asia has had to deal with that, $60 is still a honeymoon. our models are very strong. not unduly concerned about the oil price. bears for a oil long time anyway. there is a lot of supply out there. with that economy and the strength of shale and natural gas, we think oil is very manageable. but koreanhedging, airlines are looking at imposing surcharges. at what price would you consider a move like that? >> we are not a big believer in hedging. it is a temporary painkiller. playdge 20%, and we will with the fare. there is enough elasticity in our pricing. i don't see is putting a hedge on oil charges for a long time. >> if oil is at $100 you will stay put? >> correct. details, when will you start operating in china? >> let's watch this space. i am not going to announce on bloomberg. >> give us a timeline. >> the timeline depends on a lot of factors. it is not about rushing into this but doing the right thing. we are focusing on group structure, analysts always give us a hard time. philippines and indonesia along with thailand. indiabig surprise for us, where we stuck at it, and that airline is looking very good. a lot is going on for us. right.bout doing it allocating our capital properly. it is not a sprint. we will take our time. >> how many planes are you planning for your operation in china? >> china could have hundreds of planes. >> is that the plan? are short ofwe aircraft anyway, but china could go either way. it could be something that is a big word in on us. we are looking at it carefully. aircraft, will you bring forward your deliveries? we've brought forward a lot of our deliveries. at the onset, it is not a one trick pony. we are not just in asia. demand is very robust. we will have to look at an order at some point, but not presently. >> you talked about how your upbeat on india. and how an ipo is not too far away. what is the plan? you are still in losses, and in regulations you are required to have three profitable years. necessarily the way of doing it. ceos, i had aer dinner that was impressive. it was a message for foreign investment, less bureaucracy, transparency, digital. many leaders could learn from him. he is a leader who is welcoming expansion. india has been very close for many years. to see a leader talk the way he is about open market transparency. ipo in india, are you planning an ipo outside of india? >> we will wait and see. . am not a financial expert >> you are the ceo. >> we will wait and see. it is one of many options. sayingany analysts are you give cerro value to india, we have a fantastic operation that has huge potential growth. international expansion to our home base in southeast asia. we will open up connectivity. about how youlked will not sell your leasing unit, which is the jewel of the crown for asia. the deadline was supposed to be march. is that on track? >> very much so. we have three pools of growth in asia, the airline business, and we are big believers in the digital revolution. we have created fantastic joint ventures through our data and assets. sold some of our ground handling. tony fernandes, we have to leave it there. ceo, airasia. anna: thank you. the next interview, francine lacqua will be joined by the blackrock vice-chairman. stay with us. ♪ ♪ manus: good morning from european headquarters. trump's tariffs on imported solar panels and washing machines. angry trade partners including china. anna: donald trump signs a spending bill that ends the shutdown. now a politically charged battle over immigration looms. manus: bank of japan hold steady. pushes back, saying not at the point of policy exit. ♪ manus: it is 7:00 a.m. in london. it is 8:00 a.m. on the slopes and davos. francine is standing by. good morning. francine: good morning. and a couple of minutes i will sit down with philipp hildebrand , vice-chairman of blackrock. a lot of the questioning will be on these tariffs. donald, we expect him to show up on thursday in davos. ao days ahead of it, getting stern message that he will have 30% tariffs on solar panels and washing machines. this is not only for china. it doesn't to be targeting china. tom keene has a great banking panel. he has a chinese regulator on. monetaryriday, a banking and policy panel. week.l be a fun but busy i will be back shortly with philipp hildebrand. in regardsking news to b-sky-b. says the fox sky deal is not in the public interest. read headline. headline. this goes back. the fox sky merger could be against the public interest. the parties can give feedback to february.tor through the final cma report will be do on march 6. the ultimate decision on the merger will be made after the final report. this has been a deal that has had pick up after pickup for rupert murdoch. there have been scandals all across this deal. fox owns three major newspapers here in the u k. we've got easyjet reporting first-quarter revenue numbers. 1.1 4 million pounds. -- billion pounds i should say. this is a sector that many people are looking to see what kind of boosts they got in the last quarter after the demise of some of their rivals. companies such as easyjet have benefited. they are under a new ceo. fares hasof uplifting he been able to achieve after the demise of the rivals. we will keep an eye on sky and on easyjet. ones: kuroda's statement is that will be latched on. more comments coming through. the next bank of japan governor needs to have a global perspective. what a day to make that announcement. the world, record after record after record in the united states and asia. the bank of japan is pushing back against that noise of any race to the exit. it will be the ecb that wins the mantle this week. stocks are higher. even though cable is at its highest level, the market is so long, we have not seen it this long since 2015. you are seeing the market rise. is that on the back of oil? we are seeing the u.s. government reopening, keep your eye on iron ore though. that made some of the stocks this morning. some of theirk stocks this morning. markets up by 0.8% in asia. rather than focusing on trump and the tariffs he imposed on washing machines and solar panels. add to that what we have heard the dollar against the yen. kuroda being asked because his next bojoming up, the governor needs to have a global outlook he says this morning. central bank governors need knowledge and decision-making skills, he is setting out the requirements of boj governor would need. the boj pushed back against any sense that they will step away from quantitative easing anytime soon. juliette: u.s. president donald trump has slacked tariffs on solar panels and washing machines, angering trade earners . he made his first protectionist move a year into his first term. imported washing machines will see tariffs as high as 50%. china and south korea condemned the steps. they call them a misuse of trade missions. donald trump signed a government spending bill that ends a shutdown. the democrats accepted a deal that will fund the government through february 8. in exchange, mcconnell agreed to address democratic demands the congress restore protections for young undocumented immigrants who were brought to the u.s. as children. the bank of japan has maintained its stimulus program and kept its forecast unchanged. it said inflation expectations have stopped falling. the yen strengthened on the announcement. global news, 24 hours a day, powered by 2700 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . manus: thank you. blackrock has surpassed $6 trillion in assets and continues to see its influence increase with passive investing. it has also seen benefits from the u.s. tax law. this get back to davos and francine with a special guest. good morning from davos, 2018 world economic forum. joining me now, philipp hildebrand, vice chairman, blackrock. optimism but are you worried about protection is in coming back in full force because of what president trump said? philipp: the global economy has never been more integrated. all engines are firing up globally. we have synchronized growth so that is good news. we do not have to worry about ending this too soon, but it is clear the biggest risk in our view is trade. fundamentally, are we questioning the kind of global trade order that has been marking this global economy for so long? that is the biggest risk out there at the moment. inncine: do people realize davos there is too much optimism? the criticism is that ceos talk to happy talk and in the world unravels. philipp: the fundamentals are for optimism. that is real. the trade story is the risk analysis, and we have to think about how do we measure and monitor what is happening on trade. it is a big risk. it puts the united states at the core. one thing we learned during the crisis, the reason the crisis was so deep is because it emanated from the u.s. the analogy here is an important one. if we had a trade problem emanating from the u.s. fundamentally questioning free-trade, nafta, the entire framework, that could change the otherwise of what is a good situation with good fundamentals. francine: the markets are taking it in stride. are you worried about how the markets interpret the big concerns on trade and trade on the ground? philipp: markets have it hard time trading political risk. you can monitor that and go back in history, and typically the reaction comes when the risks manifest themselves. we have not seen that yet despite the announcement this morning. thingsors -- these are that underlined the risk trade represents, but we have not seen the risk materializing. when you look at passive investment at blackrock, will it continue and take a bigger share? we expect this is the preference clients have, and we expect the passive world to grow. that is one of the reasons our ceo has come out so forcefully thesaid we need to rethink passive because this is likely to grow. we also need to make sure we follow through. francine: what is the biggest challenge? if you look at the regulatory landscape for asset managers and banks, what does 2018 bring? i think just to maintain the credibility of the system we have created. there are some deep underlying challenges that we face. the uneven distribution of growth across society. these are things corporations have to worry about. sociale talked about purpose. this is an important dimension here. we have to maintain the credibility of the system, and many of these things have to get addressed. otherwise the question will become more forceful, as we are seeing in the political debates. francine: can central banks play a role in mitigating inequality? in a world were easy money is less possible. philipp: my guess is it will be less eventful and dramatic than it has been. the main challenge is to continue to focus on the mandate of pricing, presumably at this expansion continues to last for a couple of years. ,ou see a gradual pulling back moving away from this crisis induced extreme monetary policy stance. it will be a fairly steady retrenchment away from this crisis. a lot ofxpect it to be drama around central banking in the next couple years. francine: markets are repricing markets are repricing the expectation of the end of qe and the raising of rates i the end of this year. that could entail a sharp repricing of german bund's. philipp: i doubt it. it europe has been a great story for the last couple stories. it is growing almost 3%. if you look at 2017 it has been the biggest contributor to this cyclical upswing. it has been the big story. that might bring forward the monetary adjustment, but there is still slack left and the rest of the world, and europe as well. there will be time to normalize policy in the gradual way. it will be similar in terms of sequencing to what we have seen in the u.s. aancine: you are not seeing rotation from equities into bonds in the u.s.? philipp: my guess is the adjustment will be gradual. the risk of the system in my mind, if you have one of these big political risks materializing, and if you needed more stimulus, that would be a big challenge. many have pointed this out. there are limits to what we can do on fiscal policy and monetary policy. ,he key is to avoid these risks allow the expansion to go on. rates a level of interest that gives you room once the next recession comes, which will hopefully be in the future. have a lot of meetings and dinners, what are you looking most forward to? philipp: just to see how the world and president trump responds to these trade risks. i really believe we are in a good place right now. as good a place as we have been. we waited for this moment for a decade essentially. the shadow of the crisis is finally moving away. this is what we are in. we have the outcome we worked hard to get. the key will be can we avoid trade to become the next big risk to materialize. francine: if president trump comes with an american first agenda, is there another world leader -- it depends on what america first means. nafta was done at a time when global supply chains were completely different than they are today. there are many ways you can go about this. it all depends on what america first means. if it means to unravel and destroy the global trading order in a highly complicated global supply chain world, that would be bad news for the global economy. thank you so much. philipp hildebrand is the vice chairman, blackrock. we have a banking panel later on. manus: good optimism therefrom hildebrand. the murdoch family already has influence over public opinion in the united kingdom. it is a source for news flow in the u.k.. strengthen the influence of the murdoch's here in the u.k.. there is a push back from sky. bloomberg.comto to pick these up. possibleas set out remedies to these concerns. the ceo coming up on daybreak. ♪ manus: 8:20 in davos and switzerland. >> good morning. trade relations front and center here in davos. chillyssia relations are despite efforts by trump to warm them up. kirill dmitriev, ceo, russian direct investment fund is with us. on latest news from trump tariffs on solar panels. is there a risk on a trade war happening here? i think it is possible and the risks are there. wars see risks of trade and that will be a big topic to discuss and davos. china is showing it is opening to partnership, open to the world. trade wars will be a negative .hing for the world economy we just resumed a very good pace of growth. russia will be one of the growth engines over the next year. we hope trade wars do not happen. >> the u.s. is coming up with a new list targeting oligarchs and russia. how much concern is there in russia about this? kirill: russia adjusted to existing sanctions. 2% growth.ore than economy likeof the agriculture did not achieve policy goals. people will see what happens. russia's concerns about those decisions are taken in a non-educated manner. we will see what happens. sanctions, just as trade wars, are negative. >> will that impact the way you invest? ,ou invested in some companies will that impact the way you invest? kirill: we are the most nonpolitical in the world because for us to make an investment we have to have the same amount of money from foreign partners. sanctions, we continue to invest. we invested $20 billion. it would set a precedent where a nation's wealth is under attack. they will find a way to reduce the risk. trade wars with china does not mean their funds cannot be affected by sanctions in the future. we do not expect additional sanctions. we think that would be a big mistake. investment, why the change of heart in investing? kirill: we see the company is performing well. lots of other partners came in. around $50ent was million, but the company is doing well. the markets have recovered. they are selling lots of product, and we believe the prospects for the company is good. time youear at this met with anthony scaramucci. nothing has happened cents. the you expect 2018 to be a reversal of that? kirill: we focused at the economic forum in st. petersburg, business dialogue is important. we met with hundreds of americans throughout the year. will meet with americans here at the for them, and business dialogue is critical. we try to think where we can have business dialogue and have discussions. you, would youk like to have better relations with russia, what would you say? >> better relations with everybody. you talked about having representatives in new york, is that going to happen? and is that a reflection of u.s. russia ties? we have not done this yet, we want to do it. to melt a little bit before that. russia is attacked unjustly by the media, and that has to change. >> kirill dmitriev, ceo, russian direct investment fund. thank you very much. on the slopes of davos. francine lacqua as well bringing interviews. 21st century fox are responding to the report by the cma on the attempt with regards to sky, fox says they are disappointed by the findings. they anticipate the approval of the transaction by june 30. that is it for "bloomberg daybreak: europe." the european market open is next. manus: keep an eye on the dollar-yen. keep an eye on table. we are at the highest level since we voted for brexit. more to come. anna: you can hear all of that on bloomberg television. this is bloomberg. ♪ ♪ good morning. you are watching bloomberg markets, the european open. in london.y johnson matt miller is in berlin. francine lacqua is in davos. cash trade less than 30 minutes away. solar panelsfs, and washing machines in his first major protectionist move. who will be the winners and losers? the u.s. government reopens as democrats set a