Why is tech giant, Meta, in court?
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Hello and welcome to World Business Report from the BBC World Service. I'm Sam Fenwick. Coming up today, the impact of Trump's tariffs, how they're affecting US consumer and investor confidence.

A high-stakes meeting in Argentina, President Javier Millet sits down with the US Treasury Secretary. What could all that mean for the country's economy? And as golfer Rory McIlroy secures a career grand slam... That is just some finish. Absolutely unbelievable. Can't imagine how Rory thinks. I am sick of it.

I'm going home for a gin and tonic. We'll explore what it means for his brand value and the tourist economy of Northern Ireland. That's all coming up here on World Business Report in the next 30 minutes.

Let's start, though, with a pivotal moment in the tech world which could reshape social media. Meta, the tech giant behind Facebook, Instagram and WhatsApp, faces a landmark legal battle that could lead to its breakup. Regulators accuse the company of monopolising social media by acquiring its biggest rivals. Today was the first day of the court case...

And our tech correspondent, Lily Jamali, has been following it for us. So first of all, Lily, just refresh us. What's at the heart of this case?

At the heart of this case, and you kind of touched on it there, is this notion that Meta is a social media monopoly. How did they get there? Well, the Federal Trade Commission, which is the top antitrust watchdog here in the United States, alleges that they did that by acquiring these smaller upstarts that we're all very familiar with now. Instagram, back in 2012, they bought that for a billion dollars. And WhatsApp, the messaging service, two years

later for $19 billion. And the FTC says that they overpaid in order to quash that competition before it got to be a real problem for Meta. Now, Meta says there's plenty of stiff competition in social media right now. They point to YouTube, which is, of course, owned by Google. They point to X, which belongs to Elon Musk.

TikTok, the Chinese company, which has actually grown in popularity since the FTC first filed this case in 2020. They say that the FTC is kind of pulling at a grab bag of legal theories and that none of them really add up. And so Mark Zuckerberg, the CEO of Meta, has already been on the stand today. What did he say?

Yeah, I mean, so far, I haven't seen any fireworks from Mark Zuckerberg. And I think that's probably by design. He has probably endured weeks of preparation with lawyers to prepare for today. What he's been talking about so far is like sort of the beginnings of the social media market and how did they configure the company. They talk about, you know, how it was really rooted in connecting friends and family. That was a core thing that they did. We've all watched that film, haven't we, from years ago about

how it all began. Yeah, absolutely. Time to fire up the VCR again. That's going back in time, isn't it? Where we're headed now is the FTC pointing to emails from many, many years ago that show that Mark Zuckerberg was afraid of the competition that especially Instagram potentially posed. So we're going to hear him reading from those emails at the FTC's instruction as they build their case here. Yeah.

And what sort of case is it? Is it a jury or is it just a judge? This is an antitrust case. And generally, because some of the issues get very complicated, these are generally heard by a judge, not a jury. The judge in this case actually has been getting quite a bit of publicity for a different reason. His name is James Boasberg.

He's been involved in this spat with Donald Trump in the case having to do with the deportation of Venezuelan immigrants. So he's been all over the news for that. And now for the next couple of weeks, he will be heads down, very much immersed in this antitrust case. Lily Jamali, our tech correspondent, will be following that case and giving us all the fireworks as they happen here on World Business Report over the coming weeks. Thank you, Lily, for joining us today.

Well, from citrus fruits to new cars and children's toys, consumers worldwide could soon feel the pinch as prices are set to rise in the coming months. Well, Barbie's World is about to get more expensive or could become more expensive as the makers of the dolls, Mattel,

Mattel have warned that it may hike the price in the US to offset the impact of Donald Trump's tariff trade war. They make 40% of their products in China. Meanwhile, consumer sentiment in the US has taken a sharp downturn. Inflation expectations for the next 12 months have surged to their highest level since 1981. So what does it mean for everyday shoppers? Let's have a chat now with Joanne Xu. She's Director of

of the Survey of Consumers at the University of Michigan. So are consumers feeling pessimistic? And does that come from tariffs? Or is that pessimism from before the tariff news started to come out?

What we're seeing is a sharp decline in consumer sentiment that is very closely tied to tariffs. We're seeing that consumers have viewed that the economic outlook has deteriorated quite sharply over the last few months. And it's not just with respect to inflation. It's also with respect to business conditions, particularly.

unemployment rates, their personal finances across the board. People think the outlook is worse than it was just a few months ago. Reading over the weekend, JP Morgan was saying that the portion of loans in its credit card business deemed unrecoverable rose to a 13-year high. That's people defaulting on their credit cards. And that's worrying, isn't it?

That's definitely concerning because what it tells us is that consumers aren't necessarily able to keep up with their existing bills and to pay their existing obligations. And if inflation or tariffs lead to even higher prices for consumers, that is likely to get worse. Coupled with this increasing expectation for unemployment, this is not a good combination. And so do you feel that there is a risk? Does your research tell you that there is a risk of recession?

Our data certainly point to multiple warning signs. It would be one thing if people just felt bad about business conditions or just felt bad about inflation, but we're seeing it across the board, across multiple dimensions of the economy. And most concerningly, we also see people concerned that their own income growth is at risk.

So they're expecting to be personally affected by a downturn. And that means that that's really revealing a key vulnerability, given that consumer spending is two thirds of the US GDP. And so I suppose what we're going to see is that maybe people won't be buying as many Barbie dolls or toys or whatever it might be. They're going to have to tighten the belts.

They certainly don't look like they're going to be comfortable maintaining the high levels of spending that they had been in the past couple of years. The incomes and the asset prices that supported strong spending after the pandemic is just not there anymore. And Sony said today that they were going to increase the price of the PlayStation 5 in the UK, in Europe, New Zealand and Australia. So can we expect that there's going to be a general rise in prices across the globe?

That's certainly one of the risks that's possible. I think I'm not really sure that consumers are necessarily looking at that on their radar, but certainly they are bracing for higher inflation to come. And that's something that you're going to be looking at moving forward from here, presumably? Yes, that's right.

Joanne Hsu from the University of Michigan, thank you very much for joining us and telling us about that. Let's talk more about the impact of the ongoing tariff discussions now with Peter Jankowskis. He is Vice President Research and Analysis at Arbett Financial Services. He's joining us today from Chicago. So that was the feeling of consumers today.

Not great there, as Joanne was explaining, Peter. How are investors feeling now? Perhaps a little bit more positive after the White House signalled that tariffs would not perhaps go on immediately on those key consumer electronics.

Yes, the market did react positively to that. It was up about eight tenths of a percent today. I think people are responding just to the general idea that these tariffs are negotiable, that they're not hard and fast policies that are going to remain in place no matter what. And that gave a lift to the markets overall, though, interestingly enough, you

you know, technology and, uh, and consumer discretionary areas that you would have expected would have benefited directly from the, the latest concessions. Um, we're not the market leaders. What was leading the market were safe havens like utilities, consumer staples, healthcare. So, uh, I think investors still are nervous, uh,

But they're hopeful. I wanted to ask you about safe havens. This is where investors will put their money, which is seen to be less risky. And U.S. Treasury bonds have long been the first port of call for investors during times of economic panic. So they rallied, didn't they, in the global financial crisis? They rallied on 9-11. They even rallied when America's own credit rating was cut. But not this time.

Well, I think tariffs are a big part of that because certainly foreign investors are big in the treasury market here in the U.S. And they do that because they need to basically launder the currency that they receive for the goods that they're exporting to the U.S. with concerns that

that export trade is going to dry up, there's less demand for the treasuries here in the US or less willingness to buy them on the part of foreigners. So that's what you're seeing happening in that market right now. Does that reduce the number of safe havens then? And I've seen that the price of gold has been going up with central banks buying physical gold bullion. Indeed. I think it's caused people to rotate into...

physical goods that are negotiable and usable around the world rather than focusing on dollar denominated assets. Peter Jankowskis from Arbor Financial Services in Chicago, thank you very much for joining us today on the program. Thank you.

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You are listening to World Business Report from the BBC World Service with me, Sam Fennec. President Trump's trade policies could soon target the pharmaceutical industry with plans to impose tariffs on drug imports. We don't make our own drugs, our own pharmaceuticals. We don't make our own drugs anymore. The drug companies are in Ireland and they're in lots of other places, China. And all I have to do is impose tariffs

a tariff, the more, the faster they move in. The higher the tariff, it's inversely proportional. The higher the tariff, the faster they come.

President Trump speaking in the Oval Office earlier today, Monday. The move aims to boost US manufacturing but raises concerns about higher prices and potential drug shortages. I asked Marta Voshinska, a senior fellow at the Centre on Health Policy at the Brookings Institute, what drugs are already manufactured in the US?

A lot of generic drugs, so the ones that are already off patent, older medicines, those do to a large extent come from outside of the U.S., primarily from India. When it comes to branded products, the majority of it is actually made in the United States with the rest of it coming from Europe.

So it's not exactly true that there isn't much production in the U.S. Now, when you look at the number of pills, that's probably true because most of what we take, blood pressure medications, antidepressants, these kinds of products. So the tablets and capsules really are to a large extent driving the volume. And they do come from outside the U.S., primarily from India.

And that's because it's cheaper to make those non-patented drugs, those ones that have come off patent in India or in Europe or China. That's absolutely right. What's really interesting is that in the US, we paid a lot more for newer branded products. We

we actually pay much less than Europeans do for the older generic products. And a lot of it has to do with the level of competition and various policies that have been put in place, incentivizing buyers to buy the cheapest available option. And to a large extent, that has driven a lot of production outside of the U.S.

to look for lower cost environments where you can make these products. So how do you understand what Donald Trump has been talking about today? Is it that he wants the production and manufacture of those drugs that are off patent to return back to the United States? And how easy is that going to be?

It's not completely clear exactly what we're trying to accomplish with tariffs, to what extent it's about stimulating manufacturing production in the U.S., in which case what matters is less which products we move to the U.S., but just the number of jobs that we might generate, right? And I very much expect that we might see more

of a shift away from Europe to the US because the cost structure might be similar than moving from India where costs are so much lower to the US. So how easy could it be then for those facilities? To back it onshore, yeah.

Yeah. So it depends whether you're a branded or generic manufacturer and also where in your decision making you are. So let's say you're a branded manufacturer that right now is planning to build a facility and they're deciding whether to build it in the U.S. or in Europe because it's really U.S. versus Europe for them.

That decision is much easier to make in this environment because the difference between placing your site in one place versus the other, the cost differences might not be dramatic.

It's a whole different thing if you're deciding to build in the United States versus in India. It's so much cheaper to build in India. So now the upside of building in the U.S. would have to be really significantly higher. And the challenge is that it takes three to five years to build a facility and it's really expensive.

And you don't really know whether three or five years from now, we will have the same administration. What's your biggest concern about these potential tariffs? Frankly, what I worry about is that the generic manufacturers that face relatively thin margins, if the tariff is much larger than their margin, that they might decide it's not worth being in the U.S. market and they might exit the market.

And some drug markets are not particularly resilient, especially in the generic injectable space. And what I worry about is that as we see market exits, we are not going to see other players come in or expand production. And we might actually see shortages. That was Marta Voshinska. She was talking to us there from the Brookings Institute. Right.

Well, it's been a busy weekend in Argentina. The country's finalised a $20 billion loan with the International Monetary Fund. At the same time, it's dismantled large portions of its currency controls. And right now, President Javier Millet is meeting with the US Treasury Secretary Scott Besant in Buenos Aires, a discussion that's expected to shape Argentina's financial future.

Dr. Luis Ignacio Aguero is an economics professor at Belgrano University in Argentina and he joins us now. Let's talk about this loan first of all from the IMF. It's an extended fund facility agreement. What does that mean and how significant is it for the economy?

Well, it's very significant for Argentina. Argentina has been in trouble the last 20 years since we declared the largest default in history in 2001. So getting to this agreement with the IMF provides the government of Javier Millet with fresh money. And this came together with new monetary policies that imply the elimination

of the restrictions on the purchase of foreign exchange that had been in place since 2019. So this agreement with the IMF is really positive news for Argentina as we could get this $20 billion

a part of which will be used to pay the interests of the debt that Argentina has to face this year. And so this allows the economy and the government to plan for longer, for the future. It gives the economy more stability and therefore business, I suppose, more stability as well.

Yes, what we have seen today is a jump in the price of Argentinian companies' stocks. And we have seen as well a very interesting movement in the price of the Argentinian Peso.

which devalued the formal price of the peso, but the informal peso got revalued. So we have lived with these restrictions for six years so far, and this has kind of created problems.

an informal market for the peso and the foreign exchange that has been not so good for the economy. And right now, as we speak, Dr. Aguero, the president is meeting with the US Treasury Secretary. How significant is that, do you think?

Well, what we see is that the US Treasury Secretary, Scott Besant, is here in Buenos Aires. He came to give Javier Millet his support and the US government's support for these policies that the Millet's government is implementing. Probably they would be negotiating some new kind of money that may come from this institution. We don't know it yet.

But this could further strengthen the capacity of the Central Bank of Argentina and of the government of Argentina to face the challenges it has in the near term and in the long term. It's interesting that you are forging links with the U.S. as the U.S. is making enemies of other nations around the world. Yes.

Well, yes, we have to understand this in the geopolitical context that we are living, right? The US president and the Argentine president have met many times. They have developed this kind of friendship. And China is very present, not only in Latin America, but in Argentina especially, and is our second largest trading partner. So the US wants to, you know, be more present

in Argentina, be more present in Latin America, have Argentina as its ally. Dr Aguero, it's interesting times. Thank you very much for joining us on the programme today. Now, this was the sound across Hollywood in County Down, Northern Ireland, last night.

That's the hometown of last night's Masters Championship winner Rory McIlroy. He's the first European golfer to win the Grand Slam. That's golf's Masters, the Open Championship, the US Open, the US PGA Championship titles. And his fans couldn't be happier. Still slightly shocked, but it's a long time coming. You can see how much it means to him and everybody here.

And yeah, we're all just absolutely buzzing. Absolutely over the moon, Rory. Best golf you've seen. He has battled and battled. And we thought he'd thrown it away again tonight. But that is just some finish. Absolutely amazing.

Unbelievable. Can't imagine how Rory feels. Just cannot imagine because I am sick and going home for a gin and tonic. Well, I think Rory McIlroy may have had a few gin and tonics too. He's won $4 million. But it's not just Rory set for a huge payout. Let's talk about the business opportunities and the economic benefits flowing from his Grand Slam win. Kieran Maguire joins us now. He's an expert in sports business. So $4 million.

million, Kieran. It's a huge win. How will it impact his brand? Rory McIlroy is already one of the elite sportsmen on the planet. He has a $200 million 10-year contract with Nike. He has grade A commercial partners as well. He's invested in other business. So he's already worth hundreds of millions of dollars.

The additional money from the Masters is one thing, but it was completing the set. He's only the fifth person in history to have completed the Grand Slam. So the brand can only go from strength to strength. He's still relatively young. So it really depends on where he wants to go in terms of his professional career and who he wants to choose to partner with. And he's in a position to dictate terms.

And what about the brand golf? You know, there's been a lot of discussion, hasn't there, over the past few years about the PGA Championships and Live Golf. Do you think that this win helps the PGA Championships as well?

It certainly does. I mean, Rory McIlroy very much stayed loyal to the existing organisation of golf as opposed to the alternative, which was and continues to be very lucrative. I think it's a reflection of the tradition of golf, which he's been brought up on. So that can only help the more senior status of golf,

I think golf still has to try to find itself a new audience in a sporting environment where people are looking for shorter items. And a four-day tournament is difficult to attract audiences on a long-term basis. But certainly domestically in the UK, the domestic market

Broadcaster Sky had its biggest ever viewing figures for a 24-hour period. And that was very much led by Rory's activities last night. And the nail-biting finish that it was. What about Northern Ireland then? How might this impact where he plays, where he lives? Do you see and have you seen in the past an impact on golf tourism?

Well, Ireland is a huge magnet for, I think, international casual golfers, recreational golfers, because it has so many courses and because of the rugged nature of the country's landscape.

As far as what's happened last night, I think it's an opportunity. If you compare it potentially to what we've seen in football with Welcome to Wrexham, where a bit of Hollywood stardust was brought to an otherwise fairly sedate little town and the tourism boom since then has been quite spectacular. I think if Hollywood, where he's actually from, as opposed to Hollywood in California, is

If they combined with the Northern Ireland tourist authorities make it a Rory tour, then make it a Rory event. I work in the city of Liverpool and we very much still celebrate the history and the heritage of the Beatles, for example. The northwest of England, for those that don't know where Liverpool is. Yes, yes. I should have mentioned that.

So it's an opportunity to be grasped. I think Rory is very proud to be from Northern Ireland and I'm sure he will want to assist because there have been challenges socially and economically in that particular part of the country. And therefore, if he could assist his home country...

I think he would take a further pride in his achievements. I think 29,000 people visited Northern Ireland in 2023 just to play golf. And that brought in 70 million pounds, Great British pounds, into the local economy, which is huge, isn't it? It's huge. It could have an enormous effect, the Rory McIlroy effect.

That's right. I suspect people won't necessarily just come to Northern Ireland because Rory McIlroy won the Masters. But what you will see as far as the sort of the existing golf tourists are concerned, there will be now a couple of additional courses which they'll be desperate to play on because that's where Rory McIlroy grew up. So it can only be a benefit. Thank you very much for joining us today on World Business Report. And thank you to you for listening.

When you have bars in the sky, onboard showers and award-winning in-flight entertainment, it's no surprise that Emirates was recently named the best airline in the world. We fly you to over 140 destinations and with partners across the globe, we connect you to another 1,700 cities across six continents. So when we say we're also the largest international airline, what we really mean is...

If you're going there, so are we. Book now on Emirates.com. Fly Emirates. Fly better.