The world’s fourth busiest airport is set to get bigger

Summary

Marketplace Morning Report: The World’s Fourth Busiest Airport Is Set to Get Bigger

Release Date: January 29, 2025

In this episode of the Marketplace Morning Report, Marketplace’s David Brancaccio delves into a range of pressing global economic and business issues. From the expansion of one of the world’s busiest airports to the evolving landscape of artificial intelligence and the challenges faced by African entrepreneurs, the episode offers a comprehensive overview of significant developments shaping our world today.

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Heathrow Airport Expansion: Economic Boost or Environmental Burden?

Host: Lianna Byrne
Reporter: Sean Farrington

The episode opens with a discussion on the British government's announcement to expand London’s Heathrow Airport by adding a third runway. As the world’s fourth busiest airport, Heathrow’s expansion has sparked debates about its potential economic benefits versus its environmental impact.

Economic Arguments for Expansion: Sean Farrington highlights the economic rationale behind the expansion, noting that Heathrow is operating at full capacity with record passenger numbers last year. He explains, “there is that argument that there would be a benefit. You have more people going through Heathrow, that would be an improvement for the economy” (01:28). The addition of a third runway is expected to create numerous jobs both at the airport and in the surrounding areas, thereby boosting trade and economic growth.

Environmental Concerns: Conversely, environmental groups have raised alarms about the sustainability of this expansion. Farrington acknowledges the efforts made by the aviation industry to adopt sustainable fuels but relays criticism from organizations like Friends of the Climate Campaign. He quotes, “it would be hugely irresponsible to do this in the middle of a climate emergency” (02:11), underscoring the tension between economic growth and environmental responsibility.

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Tech Stocks and AI Competition: Nvidia’s Rebound and China’s Deep Seek

Host: Lianna Byrne

Transitioning to the financial markets, Lianna Byrne provides an update on the latest movements in the tech sector. Nvidia’s stock has shown a resurgence in Europe following a significant drop earlier in the week, potentially signaling a recovery from the pressures exerted by China's emerging AI company, Deep Seek.

Market Performance: The European tech sector received a boost, particularly Dutch chipmaker ASML, which saw an impressive 11% increase due to a surge in new orders. This uptick suggests resilience in the tech industry despite recent challenges.

AI Competition and National Security: However, the rise of Deep Seek has not gone unnoticed by U.S. officials. Concerns over national security risks associated with Deep Seek’s advancements in artificial intelligence have led to increased scrutiny. Byrne mentions, “US Officials are taking a closer look at the national security risks posed by what appears to be a major artificial intelligence breakthrough by the Chinese company Deep Seek” (02:40). This scrutiny is further emphasized by the U.S. Navy’s decision to ban its service members from using Deep Seek’s applications, highlighting the geopolitical dimensions of AI development.

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African Economies: Ghana’s Cashew Industry and the Struggle for Growth

Host: Lianna Byrne
Reporter: Ed Butler
Interviewees: Bright Siemens, Mildred Accoutier
Expert Commentary: Darren Acemoglu

Shifting focus to Africa, the episode examines how various countries on the continent are striving to overcome economic stagnation post-pandemic by fostering startups and small businesses. Ghana’s cashew nut industry serves as a case study to illustrate the broader challenges faced by African entrepreneurs.

Market Challenges: Ed Butler reports from Central Accra, highlighting the significant markup on cashew nuts sold locally. A small 30-gram bag costs approximately 75 US cents, a stark increase from the farm gate price. Bright Siemens identifies this as a “basic market failure” (04:19), emphasizing the need to stimulate local demand to reduce reliance on exports.

Entrepreneurial Efforts: Mildred Accoutier, founder and CEO of Aqwaba, discusses her efforts to enhance the branding and processing of Ghanaian cashews. Siemens reflects on the importance of appealing to both local and international markets, stating, “I got inspiration from international shelves… we have equally good food and we were nowhere to be found” (04:59).

Economic Expert Insights: Economist Darren Acemoglu provides expert analysis, underscoring the necessity of supporting entrepreneurs with affordable financing and better access to global markets. He notes, “These entrepreneurs really need the foreign market because... the domestic market is not large” (06:12). Acemoglu warns that without such support, local producers may continue to struggle against better-funded international competitors.

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Celebrating the Lunar New Year

Host: Lianna Byrne

The episode concludes with a festive note, extending well-wishes to hundreds of millions of people across East Asia and beyond who are celebrating the Lunar New Year. Lianna Byrne expresses hopes for a “joyous and prosperous year of the snake” (06:39), providing a positive and inclusive closing to the morning’s discussions.

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Notable Quotes:

• Sean Farrington: “you have more people going through Heathrow, that would be an improvement for the economy” (01:28)
• Sean Farrington: “it would be hugely irresponsible to do this in the middle of a climate emergency” (02:11)
• Bright Siemens: “You need to turn Ghanaians into cashew lovers” (04:44)
• Bright Siemens: “I got inspiration from international shelves… we have equally good food and we were nowhere to be found” (04:59)
• Darren Acemoglu: “These entrepreneurs really need the foreign market because... the domestic market is not large” (06:12)

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This episode of the Marketplace Morning Report offers insightful analyses on infrastructure expansion, global technology competition, and the economic dynamics within African markets. Through expert interviews and on-the-ground reporting, listeners gain a nuanced understanding of the factors driving global economic trends.

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Produced by Naomi Rainey.

Transcript

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[Lianna Byrne]

The world's fourth busiest airport is getting even bigger. Live from the UK this this is the Marketplace Morning Report from the BBC World Service. I'm Lianna Byrne. Good morning. And what airport is the fourth busiest globally, you might ask? Well, it's London's Heathrow and today the British government has announced it's to get a third Runway. Chancellor Rachel Reeves says it'll make the UK more globally connected as she pushes for growth in the economy. The BBC's Sean Farrington has been looking into this one. Hello.

[Sean Farrington]

Hello.

[Lianna Byrne]

Now, Heathrow, it's one of the biggest airports in the world. And supporters of this expansion say it would boost the economy. It's going to boost trade and jobs. But is there any evidence for that? What could it do for the economy?

[Sean Farrington]

Well, Heathrow, we get told, is basically full. Record numbers of passengers passed through Heathrow last year. And so when something is full like that, and we know that plane travel is growing at the moment, there is that argument that there would be a benefit. You have more people going through Heathrow, that would be an improvement for the economy. And also if you have more people and therefore need bigger infrastructure, something huge like a third Runway, the amount of jobs that would bring to the site itself, but also the wider area, the theory is that that would help grow the economy a lot more.

[Lianna Byrne]

But on the flip side, there are people who don't want it. I mean, airlines are being asked to cut emissions. So presumably this isn't a very green move.

[Sean Farrington]

Well, there's a debate about whether it's a green move because of what we hear from the aviation industry. No surprise is that sustainable fuel has come on leaps and bounds since maybe the peak of the last debate of expanding the Heathrow airport. But we've still had the likes of Friends of the Climate Campaign group saying it would be hugely irresponsible to do this in the middle of a climate emergency.

[Lianna Byrne]

Okay, the BBC's Sean Farrington, thank you so much, and thank you for joining us on Marketplace.

[Sean Farrington]

Thank you.

[Lianna Byrne]

Now, let's do the numbers. Nvidia stock climbed in Europe this morning, which hints that it could be on the rebound after this week's steep drop caused by the new AI competition from China's Deep Seek. European tech overall also got a boost, helped by an 11% jump in Dutch chip maker ASML, which reported a surge in new orders. And let's stay with tech for now because US Officials are taking a closer look at the national security risks posed by what appears to be a major artificial intelligence breakthrough by the Chinese company Deep Seek. It follows reports that the US Navy has banned its service members from using Deep Seek's apps. Let's turn to Africa now, where countries across the continent are trying to pull themselves out of something of an economic slump since the pandemic. And now they're banking on startups and small businesses to generate better growth. But it's a challenge. Many African economies, which rely heavily on agriculture, still import a lot of their food staples. The BBC's Ed Butler has more from Ghana, where cashew nuts are heavily farmed.

[Ed Butler]

So we stopped at the side of the road. Now, this is just one of the busier thoroughfares of Central Accra. There's a lady here with whole bags of nuts. Can I see? You've got cashew nuts here. I'm buying my nuts and they're costing me about 75 US cents for, to be honest, a pretty tiny 30 gram or 1 ounce bag. Now, these nuts have been shelled, roasted and packaged. But I've done the maths and this tiny bag I'm crunching on now, it comes at a pretty astonishing markup. 40 times the farm gate price. So how does that happen?

[Bright Siemens]

Mein Chiori is we focus a lot on the supply side. Oh, how do we get the soil to yield more cashews? But a lot of the beauty is on the demand side.

[Ed Butler]

Bright Siemens is a social commentator, innovator and entrepreneur himself in Accra. And he's given a lot of thought to this cashew question, what he calls a basic market failure that's symptomatic of many others. In Ghana.

[Bright Siemens]

You need to turn Ghanaians into cashew lovers.

[Ed Butler]

Some Ghanaian entrepreneurs are also cracking open the local market. This is Mildred Accoutier, founder and CEO of Aqwaba, a cashew processing firm based on the outskirts of the capital.

[Bright Siemens]

I got inspiration from international shelves, where I saw lots of interesting products with beautiful branding. And I asked myself where the Ghanaian products were because we have equally good food and we were nowhere to be found.

[Ed Butler]

But she says her problems come from massively overpriced credit from the banks at 30% interest or more sometimes and at a market that is geared towards supplying foreign multinationals.

[Bright Siemens]

Currently, we can't even meet demand. We can't get enough canals to roast because we have a lot of foreigners from India and Vietnam coming in with funding with lower interest rates and they are able to carry a lot from Ghana away.

[Ed Butler]

And that competition from better funded and more powerful exporters is what's driving many Ghanaian processors out of business, according to Darren Acemoglu. He's a Nobel Prize winning economist and author of why Nations Fail. He says supporting entrepreneurs like Mildred with cheaper finance and better access to foreign markets is going to be the only way you'll see domestic producers like her succeed.

[Darren Acemoglu]

These entrepreneurs really need the foreign market because, you know, with the exception of South Africa, Nigeria and a few other places, the domestic market is not large. The middle class is small, so they need the outside market.

[Ed Butler]

And in a global era of more tariffs and rising trade barriers, there may not be any short term fixed for Ghana's cashew processors or cashew eaters like me. I'm the BBC's Ed Butler for Marketplace.

[Lianna Byrne]

And finally, hundreds of millions of people across East Asia and elsewhere are celebrating the Lunar New Year. So wishing everyone a joyous and prosperous year of the snake ahead. And that's it from the Marketplace morning report from the BBC World Service. Naomi Rainey is our producer today and I'm Liana Byrne. Have a great day and thanks for listening.

[Emily]

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