this is bbc news, the headlines: israel has come under further us pressure with the vice—president kamala harris and defense secretary both highlighting the plight of civilians in the gaza strip. the us vice—president, kamala harris, said too many innocent palestinians had been killed. one person has been killed and two others injured in a knife and hammer attack in central paris. the french president, emmanuel macron, sent his condolences to the family of the victim, a german tourist. a police source is quoted as saying the suspected attacker is a french national and was known for radical islamism and psychiatric disorders. scores of people in cumbria have spent the night in temporary accommodation or in their cars, after heavy snow falls. the police have asked people to stay away from the county. a yellow warning of snow and ice is in force across large parts of england.

now on bbc news, talking business. hello, everybody. a very warm welcome to talking business weekly with me, aaron heselhurst. let's go take a look at what's on the show. big china challenge. it is a year since covid lockdowns were abandoned but is the second biggest economy back to full health? trade tensions in the us are some of the emblems xi jinping's government are trying to tackle. this leading china economist will explain how the government needs to balance its ambitions with the changing demands of radically different younger generation if it wants the country to thrive. plus this former head of the international monetary fund's china division told me how beijing's struggles are affecting all of us around the world. and keeping the internet free and fair. the big boss of web browser firefox tells us how her foundation is trying to

compete with the deep pocketed rivals like google and apple and still have an influence. wherever you arejoining me from around the world, a big hello and warm welcome to the show. china— it is the world's second biggest economy, trailing only the us and is more than four times the size of the next on the list, japan. so what happens there certainly matters. but a year since the government abandoned coronavirus lockdowns, it's an economy that is still struggling. the challenges for president xijinping's government include vast debts in the property market and local government, soaring youth unemployment, and an ageing workforce and trade tension with the us. some say the 5% growth was deliberate. but it will be a change according to the international monetary fund, who finish their

assessment is in november while warning the big challenges still lay ahead. we warning the big challenges still lay ahead.— still lay ahead. we pro'ect china's gdp i still lay ahead. we pro'ect china's gdp growth h still lay ahead. we pro'ect china's gdp growth toh still lay ahead. we project l china's gdp growth to reach 5.4% in 2023, reflecting a strong post— reopening rebound in domestic demand, particularly in consumption. we project close —— growth to slow to 4.6% next year as we expect the weakness in the property sector to continue. an external demand to remain subdued. the vast mismatch _ demand to remain subdued. the vast mismatch between supply and demand for new properties is certainly casting a big shadow over the entire chinese economy. as our china correspondent stephen mcdonald found out on a trip there. this woman bought a flat here a couple of years ago. but her estate remains largely empty and its value has collapsed. {iii and its value has collapsed. of course i am worried but what can i do.

course i am worried but what can i tie-— course i am worried but what can i do. , ., can i do. everywhere there are shells of tower _ can i do. everywhere there are shells of tower blocks - can i do. everywhere there are shells of tower blocks which i shells of tower blocks which appear abandoned. this problem with real estate supply and demand is not limited to this area. it isn't even limited to this city. you can drive out of here for hours and you will find clusters of towers with unoccupied or unfinished apartments. many where work has stopped altogether. and consider the same thing is happening in province after province right across the country. one estimate says that amounts to 26 million unsold newly built homes. that's enough to how the entire population of italy. and it is also draining confidence. there is also not enough jobs for young people. 2i.3% is also not enough jobs for young people. 21.3% of 16—24 —year—olds didn't have one in june, prompting the government to stop publishing those numbers altogether. part of the problem is lessjobs numbers altogether. part of the problem is less jobs are numbers altogether. part of the problem is lessjobs are being created by foreign companies. in septemberforeign created by foreign companies. in september foreign investment was down by one third competitor the same time a year earlier amid global economic

challenges including inflation and those us— china tensions. in the chinese system ultimately the buck stops with president she's government and he has some big challenges to tackle. —— president xi jinping's government. tackle. -- president xi jinping's government. our goal is notjust _ jinping's government. our goal is notjust to — jinping's government. our goal is not just to have _ jinping's government. our goal is notjust to have a _ jinping's government. our goal is notjust to have a few - is notjust to have a few wealthy people but realise common prosperity for all. employment, education, medical services, childcare, elderly care, housing, the environment and the like these are real issues, important to people's daily lives and close to their heart. they are being steadily integrated into our top—level plans for national development. so what does china's development look like in the years ahead and how difficult will it be to solve the tensions between socialism and capitalism? i have been speaking to one leading china economist who is a professor at the london school of economics and has been addressing those very westerns in her new book, the new china playbook. a real

pleasure having you on the show. let me start with this. the challenges for president xi jinping when it comes to china's economy are vast and varied. i wonder why we have you, what is the most pressing point do you think in your consideration?— point do you think in your consideration? the chinese economy — consideration? the chinese economy is _ consideration? the chinese economy is undergoing - consideration? the chinese economy is undergoing a i consideration? the chinese - economy is undergoing a serious challenge, lowest growth for the last a0 years, high youth unemployment, mountainous debt, and the debt overhang, but very little income growth so that people are saving 50% household savings rate has really peaked. these are serious challenges but i want to ask a question, is this cyclical or structural. it is a permanent decline, demographics and ageing and more state control meaning doom loop? i don't so. the very fact is that the chinese economy did not see this kind of huge stimulus package that europe and the us had during the pandemic, so there is a lack of

confidence post pandemic recovery is slow, it is a painful, long adjustment. added to that is the real estate, real estate is driving everything down. you are saying this is cyclical at the moment. i think most of it is cyclical. we cannot underestimate china's ability to change policy very swiftly. you can't write off the second largest economy and say it won't overtake the us at some point, i think that's the wrong assumption. in some point, i think that's the wrong assumption.— wrong assumption. in your recent book, _ wrong assumption. in your recent book, you - wrong assumption. in your recent book, you argue - wrong assumption. in yourl recent book, you argue that china is entering this new era, soon to be shaped by a radically different younger generation. how will that shift change the chinese economy? the new change the chinese economy? tue: new generation change the chinese economy? tte: new generation is very different from the older generations, they haven't gone through the huge vicissitudes, the nation has gone through. the psychological and physical and economic hardship. the? and economic hardship. they have had _ and economic hardship. they have had it — and economic hardship. they have had it easier? - and economic hardship. they have had it easier? they - and economic hardship. they| have had it easier? they have had that much _ have had it easier? they have had that much easier- have had it easier? they have had that much easier and - have had it easier? they have | had that much easier and want to spend more. they want to be more relaxed and work less,

they spend more on things like leisure, travel, apparel, entertainment, much more than previous generations, despite having lower income. so that is a totally new kind of way of life for the new generation. earlier this year we saw china's youth unemployment past the 21% mark. but we have also seen over recent years ageing sort of cracking down on youth focused industries such as things like private tuition, technology like gaming. i am wondering, all of that, has it helped or hindered the situation?— helped or hindered the situation? ., ., , , situation? the ma'or problem is that there is — situation? the ma'or problem is that there is a — situation? the major problem is that there is a skill _ situation? the major problem is that there is a skill and - that there is a skill and education mismatch for that youth, so 100 million new couege youth, so 100 million new college graduates in the last 10-15 college graduates in the last 10—15 years, where do they go? they have university diplomas but what is the economy, what kind ofjobs are there? there are 25 million manufacturing jobs yet to be filled, but these young people whose families have paid enormous sums for their education, hence the regulatory crackdown on the

tutorial sector, they don't want their kids to be in some factory. that mismatch is really important. but the government is actually raising the status of vocationaljobs less discrimination, so that is really happening rapidly. it makes you wonder if the chinese government's policies are forward—looking enough to embrace this whole new generation. i think the chinese government is one of the most forward—looking and continuous with continuous policy governments in the whole world. and its ambition is to make china be a higher point in the value chain, in the global supply chain and to train its engineers and technical workers. and so that is the direction. but tutorial programmes, this has gone really out of hand because of the one child policy, all the parents want to make their kids dragons and phoenixes. and they would empty their bank accounts to do that. and indeed a lot of

these companies exploited that demand. , ., , . ., , demand. the private sector is the major _ demand. the private sector is the major driving _ demand. the private sector is the major driving force - demand. the private sector is the major driving force of- demand. the private sector is the major driving force of the | the major driving force of the economy, that provides the lion's share of the jobs which means social stability, national output and innovation. the government knows that so the government actually goes out and really actively tries to support the private sector. you might be sceptical but recently there has been a slew of policies that have come forth, at least changing the attitude towards the private sector. �* ., , attitude towards the private sector. �* , sector. and as you very well know, sector. and as you very well know. one _ sector. and as you very well know, one of _ sector. and as you very well know, one of the _ sector. and as you very well know, one of the big - sector. and as you very well i know, one of the big problems for china at the moment is debt, particularly in the property market. you have two very large property developers, you have china evergrande, it has debts of around $300 billion, country garden has debts of around $190 billion. there is something like 26 million unsold homes. does this sut test million unsold homes. does this suggest china — million unsold homes. does this suggest china can _ million unsold homes. does this suggest china can no _ million unsold homes. does this suggest china can no longer - suggest china can no longer rely on the property market for economic growth? tt rely on the property market for economic growth?— rely on the property market for economic growth? if you look at the data, the — economic growth? if you look at the data, the pre- _ economic growth? if you look at the data, the pre- pandemic- the data, the pre— pandemic trend pretty much 80% of the set is have recovered, almost

back to pre— trend levels, except real estate which is just, the real estate is really what is dragging trainer's growth down. you have this huge bubble. —— china's growth. because the high housing prices have made people not want to have made people not want to have children because they can't afford the living space, and that has caused social concerns. and real estate developers have grown and really borrowed, bought soccer clubs and have behaved somewhat irresponsibly, and that is not going to return either. we have to still remember that there is still hundreds of millions of people that are going to move from rural to urban areas but it will be a long, painful adjustment because these people don't yet have the income to be able to purchase these apartments. and by the way, a lot of these apartments, empty apartments, are going to be turned into affordable housing, which is consistent with china's common prosperity of supporting middle income group, and that could be a good thing too. �* ., ., , , too. and one of the problems

aned too. and one of the problems linked to the _ too. and one of the problems linked to the whole _ too. and one of the problems linked to the whole property | linked to the whole property sector is the selling of land that we used to see the local government sold the land, but used to be a cash cow to them. now that has kind of dried up. is there a concern that these local governments simply won't have the funding to provide the services that they need to provide, education and health for example? the provide, education and health for example?— for example? the local government _ for example? the local government debt - for example? the local government debt is - for example? the local government debt is a l for example? the local - government debt is a major issue and i think if there were anything i would name, it is one of the biggest challenges to the economy going forward because they have similar responsibilities for the local economy. and 50% of the revenues, their revenues came from land sales and now that is gone. so they have to find alternative sources of revenue. they are going to rely on the entrepreneurs and the companies to do well and circulate taxes. let me talk about manufacturing, over the decades it has been a driving force for economic growth china, think it still accounts for like on our% of the economy. i am wondering, keyu of the economy. i am wondering, kequin, have of the economy. i am wondering, keyu jin, have we seen the end

of china being the world's factory floor and our other industries coming into play? the leadership in china has this idea that manufacturing, making real stuff, technical stuff, is really important. and china wants to be a bigger and" smarter" germany, in a sense of using ai communications to do high value—added manufacturing. so that is still the goal but it is to climb up the value chain. a lot of the low—end manufacturing has already moved to neighbouring countries, south—east asia and so forth, but that in the leadership mind is most important. hence the crackdowns on the real estate and even the financial system because it doesn't see it as the real economy.- because it doesn't see it as the real economy. and let me end on this. _ the real economy. and let me end on this, because - the real economy. and let me end on this, because i - the real economy. and let me end on this, because i am - the real economy. and let me | end on this, because i am just wondering. does beijing, president xijinping, do wondering. does beijing, president xi jinping, do they even care about the huge role that china plays on the global economy, especially if that conflicts with their domestic agenda? do they care about the

role china plays? the agenda? do they care about the role china plays?— role china plays? the us is the world's largest _ role china plays? the us is the world's largest economy - role china plays? the us is the world's largest economy but i role china plays? the us is the world's largest economy but atj world's largest economy but at no point in time does the fed make its decisions, despite all the impact on the global economy, based on external environment, but rather solely on domestic economic conditions. let mejust on domestic economic conditions. let me just say that china's challenges today are overwhelmingly internal, and hence the focus is internal. he does want to play a bigger role in the global economy stop there is actually no contradiction to saying they want to be critically independent on certain technological goods and components, at the same time embracing a globalisation in terms of investment and trade. 0n terms of investment and trade. on that point, professor keyu jin, a pleasure to have you on the show, thanks for your time, good luck with the book, i know it's doing well, we will check in with you soon. china has deplored microphone forge a path after covid but there will be considerable

consequences for the rest of the world which is something i've discussed with the cornell professor of global trade are used to head up the international monetary crowdfund china division. it seems pretty clear china's economy isn't firing on all cylinders so what big of a problem is that for the rest of the world? china is the second—largest in the economy and since the global financial crisis of 2028 —— 2008 china has been the main driver of global growth and even more to global growth and even more to global gdp and global demand that even the united states so when the second largest economy in the world slows down, it means the demand for commodities is regrettably weak and chinese consumers are holding back on consuming so this means overall global demand is much weaker than it would otherwise be. economic relationship between china and

the world biggest economy the united states have in recent years been defined by this tower of trade restrictions. they were started in 2018 by then president trump and continued with president biden but how much are they hobbling china's growth or has china just now learned to live with them? ., , just now learned to live with them? . , ., ., them? the reality that china faces is that _ them? the reality that china faces is that the _ them? the reality that china faces is that the relationship between the chinese and the us are going to remain rocky for a while. but it's really china's attempt to move into what is seen as the industries of the future such as clean energy, green technologies more broadly which also happens to be the areas where the us is trying to establish its dominance and has become the central points of conflict. certainly at the moment where business and private confidence more broadly in china's weeks, the ongoing tensions between the us and china don't do anything to help either the consumer or business confidence.

either the consumer or business confidence-— confidence. china is clearly concerned _ confidence. china is clearly concerned about _ confidence. china is clearly concerned about the - confidence. china is clearly - concerned about the slowdown in its exports. it's an important sector and makes up roughly 20% of the economy. the government is actively encouraging foreign companies to invest more in manufacturing but i'm wondering what happens if that doesn't work? ., ., , what happens if that doesn't work? . . , , , ., work? china has been trying to tromote work? china has been trying to promote innovation _ work? china has been trying to i promote innovation domestically the private sector feels it doesn't have the government support and have been holding back on investment so china relies on foreign technology and now that you have geopolitical tensions and the chinese economic slowdown that are deterring foreign investors from coming into china, there are also not bringing technological expertise with them. . how important is china's private sector revival to reboot the economy? i'm back from china and there seems to

be a significant disconnect between what the government is saying that it continues to support the private sector and what entrepreneurs feel. they feel the government is much more hostile towards them and wants to make sure that no private enterprise grows too big for its breaches. the reality that beijing faces however is that they need the private sector small and medium enterprises and both manufacturing and services sectors have been very important for the employment growth. unless the chinese government can fix this problem of declining private sector confidence, especially private business confidence, it's going to be a tough slog for the economy. xi to be a tough slog for the economy-— economy. xi jinping's big economic— economy. xi jinping's big economic vision - economy. xi jinping's big economic vision for - economy. xi jinping's big economic vision for the l economy. xi jinping's big - economic vision for the world has been that $1 trillion belt and road initiative which was marked its 10th anniversary and that's china investing in building infrastructure all over the world in an attempt to fuel economic growth and things ranging from ports in greece to

railways in zambia. is that spending by china likely to slow now that china's struggling so much economically at home? ., . . at home? for a while in china was doing _ at home? for a while in china was doing well— at home? for a while in china was doing well economically, | at home? for a while in china i was doing well economically, it seemed to make sense for the government to use the belt and road initiative and other initiatives to try to use its financial clout to also increase its geopolitical power around the world. at a time when china is receiving pushback from the countries that gave money to and it is not generating good returns on its investments, now that that's happening at a time when the chinese economy itself is weak, i think we are seeing a reconsideration from beijing about the wisdom of undertaking such investments at such scale around the world. beijing, it become very difficult to accept losses on its lending because of on the one hand there are significant economic costs of course, the writing of those

loans, but also the symbolic element that beijing does not want to be seen as having made unwise investments. it doesn't look very good for the central government and beijing to encourage many of these investments and have to take losses at a time when chinese citizens have to tighten their belts because the economy is not doing so well. do you think, given the ongoing cost of living crisis for many parts of living crisis for many parts of the world and many western consumers are more reluctant to put their hand in their pocket, do you think the era of global growth fuelled by buying cheap stuff from china is now over? that translates into a broader question about seeing the end of globalisation. 0ne level, certainly, there are geopolitical and other reasons why many manufacturers are turning away from china is a key component of the supply chains but the reality is

consumers around the world are still going to try to find the cheapest rights they can find and manufacture as they try to find the cheapest ways of producing what it is that consumers want but certainly at a time when wages are not rising very fast and prices are rising very fast and prices are rising very fast consumers around the world are certainly going to be a bit more reluctant to dig in their pocket to spend. a pleasure having you on the show, thanks for your time. having you on the show, thanks foryourtime. it having you on the show, thanks for your time. it has been my pleasure. you know competing against the likes of tech giants such as google and apple is no easy feat but how much harder is it when you are a not—for—profit foundation that wants to make sure the incident plays a more positive role in the world? that's exactly the challenge that the chair of the mozilla foundation has to face every day. its main product the firefox web browser normally does not come pre—installed on our devices. does not come pre-installed on our devices-— our devices. thanks for your time, our devices. thanks for your time. really _ our devices. thanks for your time, really good _ our devices. thanks for your

time, really good to - our devices. thanks for your time, really good to see - our devices. thanks for yourj time, really good to see you and start with the question. i've been talking about on the show, china, and one of mozilla's biggest goals and founding principles is to make the internet a global resource, open and accessible to all so mitchell, how can you do that for china when the internet is so heavily censored there? tt’s so heavily censored there? it's a real so heavily censored there? tt�*s a real challenge. as many things about the internet that make it a global public resource and some of those are censorship that we see at a human experience level and others are in the internet and technology in automatic i'm going to the un next week to discuss these very topics. the consumer experience are a vision of how online in automatic works is clear and in the service of stability and society in the state. the economies _ society in the state. the economies look - society in the state. the economies look including china look increasingly to service industry for economic growth, how important is a free and fair internet to that and what

do you think that contributes to the growth? tt’s do you think that contributes to the growth?— to the growth? it's such an important _ to the growth? it's such an important question - to the growth? it's such an| important question because to the growth? it's such an - important question because the free and open internet is what allows competition and what allows competition and what allows things to develop. and so you need a free and open internet to be able to reach consumers on a level playing field to be able to offer the business you want and be able to compete without having to start having products all up and down the stack the way that the giants already do. let’s the giants already do. let's talk about _ the giants already do. let's talk about your _ the giants already do. let'sj talk about your competition the giants already do. let's talk about your competition and money. how do you, mitchell, take on the likes of apple, which is sitting on a cash pile of some hundred and $62 billion, google's parent alphabet has about $118 billion in hand. ., �* , alphabet has about $118 billion in hand. ., v ., ., alphabet has about $118 billion in hand. . �*, . ., in hand. that's a hard battle, isn't it? it's _ in hand. that's a hard battle, isn't it? it's a _ in hand. that's a hard battle, isn't it? it's a very _ in hand. that's a hard battle, isn't it? it's a very hard - isn't it? it's a very hard battle, competing with the giants of any technology is tough. as we live that difficulty every day. and so, i think the idea of a head—on

challenge to one of the giants is exactly ——in exactly the design phase they're working on is a long time coming and open source has done that on numerous occasions but it does take time. and it does take some changes in the environment. at mozilla, we've always believed that technology of the internet should not be immune from regulation because thatis immune from regulation because that is how citizens and societies exercise their vision of life into the business world. i think one reason why mozilla's nonprofit status is so important is because we make decisions that an investor may choose not to. i don't know, to push the internet closer towards the balance that society needs.— towards the balance that society needs. since you've launched — society needs. since you've launched firefox _ society needs. since you've launched firefox back - society needs. since you've launched firefox back into. launched firefox back into thousand four, mitchell, you've seen your share of the internet browser market plummeted from a peak of about 30% to about now, 3%. does they become a point at which it is not worth the cost

of trying to compete with the big guns? me of trying to compete with the bit tuns? .., , of trying to compete with the big guns?— of trying to compete with the bit tuns? .., , big guns? we compete with the browser for— big guns? we compete with the browser for a _ big guns? we compete with the browser for a few _ big guns? we compete with the browser for a few different - browser for a few different reasons though. it may seem like we love the browser because we have always belted. it's probably true. but underneath it, the browser is an odd piece of software. the only protection you have is whatever protection the operating system gives you. and a general level can provide some security and with firefox representing you. but what we do. everything from protecting you to allowing you to change simple things like websites and bots to deeper things that consumers don't experience directly, so we compete because that question of who represents the individual in a highly centralised technological society is critical.- society is critical. your foundation's _ society is critical. your foundation's biggest . society is critical. your - foundation's biggest source of cash is a half $1 billion a year that google pays to be the default search engine on firefox and at the moment, google is on trial in the us

where the usjustice department accuses it of unfairly shutting out rivals from the position of being the highly profitable default search engine on web browsers. how can —— how concerned are you about the foundation's future given that the trial could lead to the loss of money from google? there's many reasons to work on revenue diversification and we've been doing it for some time. there is the one you mentioned, something catastrophic could happen. also long—term change in consumer habits and markets and customers and business relationships and so, there is some catastrophic change, whether it's the one you mentioned or something else in the future then we will address it is a long—term piece of how is it that the internet�*s impact on society is a more positive benefit to society thanit positive benefit to society than it is today? we will continue with that.- than it is today? we will continue with that. even if the form of work _ continue with that. even if the form of work changes. - continue with that. even if the | form of work changes. mitchell baker, the big boss of mozilla, thank you for coming on the

show and we will check in with you soon. show and we will check in with you soon-— you soon. it's my pleasure! that's it — you soon. it's my pleasure! that's it for _ you soon. it's my pleasure! that's it for the _ you soon. it's my pleasure! that's it for the show. - you soon. it's my pleasure! that's it for the show. i - you soon. it's my pleasure! l that's it for the show. i hope you enjoyed it. keep up with the latest on the bbc news website and the smartphone app and follow me on x, x—men, i will x you back! thanks for watching.

good morning. welcome to breakfast with sarah campbell and ben thompson. 0ur headlines today: police declare a major incident in cumbria after heavy snowfall and drivers abandon their stuck vehicles. weather conditions at least have improved for today but more across parts of the midlands, northern england waking up to a covering of snow and ice. we turn our attention to rain across southern areas. i will have the details. as southern gaza faces some of the heaviest bombardment of the war so far, hamas says it won't release any more hostages until there is a permanent ceasefire. scotland have the honour of getting next year's euros under way. they're drawn in a group with hosts germany and will play the opening game against them onjune1a.

a hero's welcome for kevin sinfield