Says the country will return to the market following an exit from the cleanout measures. And cnbc is told that economists are off track and inflation in his country is under control. Economists in the private sector, in the past three months, they have been consistently wrong. Youre watching Worldwide Exchange. Bringing you Business News from around the globe. Hello and a first welcome to the first Worldwide Exchange of the week. A remind they are a the u. K. Markets are closed as a holiday today. More on that, but first we kickoff with the prorussian rebels rushing a station in russia after a fire in a building being occupied bicep atists. The Prime Minister has criticized the police force for not doing enough to stop the clashes and blames moscow for not interfering in the country. It seems to me that the entire world is facing a new type of war. This is the new war. With the military with insignia on their uniforms and the agents with a well organized terror plot network, with the diplomatic pressure on ukraine, with the tough and rude russian propaganda, with the plain ukrainian sentiments and not on only ukrainian. And Angela Merkel is trying to threaten off the oil crisis. Ukrai ukraine owes russia 3. 5 billion. And they have announced talks of cooperation with europe. Joining us now in paris, steve . Hey, ross. Just on the geneva one and two accord, i have to remind viewers that if anyone, both sides here, are able to enact geneva one, then maybe we wouldnt need a gentlemeva two. One is military weapons and all kinds of issues on its side. Two, prorussian sectors would leave the buildings and disarm on the other side. Three, the talks begin about greater tax for the regions that in the south as well. So if all those things were enacted on both sides, i dont know what to move forward than to get out of geneva one even if it was enacted. Now well move on to the danger. You heard the acting Prime Minister in kiev talking about his concerns that this would have geo political manifications from this. Yes, the dow is trading at its first yearly high, record high last week, but theres a real concern that economically this could have ramifications even though the world seems to have ignored it so far. Well listen to what i was told yesterday about his concerns of how this would hit sentiment in the market and broader economy. It is tense. It is having an effect in the confidence, just at the time were trying to build the confidence again. You know, the confidence is broken with pieces all over the floor. We are trying to pick them up with crazy glue and suddenly this happens. It is not because of the link to trade or finance with the rest of the world or ukraine, even less so, they are relatively modest. But the question is this is affecting the systemic confidence. And this is coming at a time when we are trying to build b k back. So Something Like this is never good, but it comes at a particularly awkward and inopportune time. I liked how he described it as crazy blue and getting ourselves back on track. I like that one. Well get the russian side as well. We have heard a lot from the west. Im delighted to be joined by professor vladimir mo from the National Public administration in moscow. Sir, thank you very much for joining us. You have been giving me a History Lesson off camera and would reference that, when did economic rational take a secondary place to what is happening on the political front in the kremlin . Well, we would start with the limitation wellknown in russia that politics is a concentration expression of the community and of course this does matter, but dont forget that the russian economy is in many cases in quite good shape compared to the most advanced economy in the world now. The key positive elements with russia is that they have a balanced budget, external debt is below 2 gdp. And the debt is about 11 of gdp, almost nothing. Russia has growth rates below 1 right now. It will be at half percent, 1 or something. Even recession, but again, this has nothing to do with international politics. Russia has reached the level and all growth problems emerge from previous few years. Let me protest that assertion that it has nothing to do with the political event. My colleague was told that theres 100 billion of ruble worth from the country this year. U. S. Business leaders are being told by the president not to attend this economic international forum. Rates are willing lifted to 7. 5 by the central bank at a time when the economy is potentially growing as well. All these political events are adding to the russian economy at a time when they can least afford it. Yes, but all the pressure comes from previous yield, too. It is not about ukrainian events. Again, when we speak about capital flat, we have to understand that it is not money physically going out of russia. The most part is people redistributing their assets from ruble to dollar, but when you have about 12 inflation within the last year, it is reasonable mean that is the russian rate is flexible and russians prefer to shift into hot currency at the moment. Again, it is very reasonable and rational. Money isnt the speaking about increasing Interest Rate, again, to me its very good indicator because the real danger of russia is not deflation as in advanced economies in the west. The key problem for russia is up nation to my mind and the ability of the central bank to be a positive indicator. There are concerns about liquidity for russian corporates, about the capitol flight as well, so no coincidence last week there was a story in the Financial Times saying the most expensive property that sold flat in london was 140 Million Pound property bought by a russian purchase as well. There are concerns about fdi not coming into the country. There are concern that is russian corporates are starved of cash because of the low valuations because of the crisis. Valuations trading below half the merging market level. Of course course, this is a serious problem but it has primarily institutional and economic ground. Again, political politics does matter. Politics is important, but again, all these problems in russia faced a year or two ago, and this is very important. It is very dangerous to my mind to concentrate on current pieces. The basic idea, the basic problem is that russia, which was developed in the previous ten years, faced to the finish hold of conflict between institutions and economic prosperity. So well leave it there, but it is very good getting the education about where the rational comes and i think that was very obvious. Thank you for your time today. Professor vladimir mo from the president ial economy of National Economy and public administration. Ross, i know you already had your lenon politics, but if we had read lenin more properly, we would know what mr. Putin was talking about. Mr. Pickety comes to mind, ross. Yes, hes getting a lot of press, mr. Pickety. Im not sure i agree with it. Im still reading michael lewis. Theres a lot of holes to pick with mr. Pickety. Steve, thank you. Plenty of great History Lessons coming out from steve. Right now here we are, just an hour and 11 minutes into the trading day in europe. And you see red across the board. Just worth pointing out, gray here for the u. K. With the markets closed today. Theyll have their beginning of may daybreak today. The dax, we saw stocks dip down toward the end of the session on friday. Down 13 points. The cac is down. 20 as well. The micex is just up. 10 . A number of individual stocks worth looking at, Credit Suisse is currently down 2. 5 . Press reports that u. S. Authorities are going to put pressure on the suisse bank to plead guilty in the ongoing tax dispute according to the newspaper. Washington is asking for a guilty plea to claims that the bank helped tax money. Bmps is down 6 today. Finally shares in the bank are up a percent offering rights to a 500 million capital euro increase. Well show you where we stand, we have a fascinating move on the treasuries. Tenyear treasury yield, 2. 58 . We have been at threemonth lows with the yield of 2. 57 . Payroll reports on friday. Remember, 288,000 created in the unemployment round down to 6. 3 . Yields did rise five basis points, but ukraine issues and geo politics overshadowing the gains in the unemployment report and we have a rather big threatening on the treasury yield. Keep your eyes on that. And it is worth pointing out, spanish yields here are below the 3 yield down to the 3 mark. We went to 3 for the first time in nine years. On the currency market, the dollar is on the back foot. The yen hit twoweek highs with the dollar losing the gapes from payrolls. 103 on friday. 108. 86 over the session. Euro dollar, 138. 12. Back up to 178. 83 this morning. Thats where we stand in europe. Sri has the action in the chinese numbers at singapore. Sri . Thank you. The china pmi was the big thing today and it was a fairly negative one. This is the final hsbc number for Manufacturing Activity as going by the pmi. Came in at 48. 1 versus the flash figure of 48. 3. So contraction of moving lower into moving further into contraction territory. So that contraction deepening in other words. When you look at the sub components, fairly negative as well. Especially the negative exporters with more contraction there. We saw a slowdown in the second World Economy that hit the Hong Kong Market squarely down by 1. 3 . The shanghai composite is consolidating just about 2,027. You have to remember that volumes that much more thinner on the ground because japan is not trading today with a Public Holiday over there. Elsewhere, youve got to look at the china print through the prism of the currency markets. Very negative. The aussie dollar was clobbered. At one point it was below 92. 60. It has bounced off that session low, but that is just indicative of the stress lines that this data is creating. Theres more to come as well, ross, later this week. The Services Sector numbers as well as the trade data. Well get an idea of how sluggish external demand is for chinese goods later on this week. Back to you now, sir. Sri, we look forward to that. Catch you later with more to come from singapore. Well, the bank of japans positive outlook on the inflation target may have come as a surprise to some bank of japan watches. But with the impact of aprils sales tax hike taking effect, is it really within reach . Susan lee has been speaking exclusively to the governor and asked him to justify his optimism. I think two things we have to be careful, one is, of course, the impact of the consumption tax hike. Another is the nature of the recovery this time. First point, yes, just before the consumption tax hike, consumption on expenditures on automobiles, et cetera, they soared. And now they declined quite sharply, but the decline after the tax hike has been, as we expected or even less than we expected. So the decline appears to be not so large. So we dont think negative impact on consumption of consumption tax hike would be contained. And the economy would start to recover in the Third Quarter by september. Why are you so optimistic . Because again, economists predict we could be in recession. But, you see, i dont economies in the private sector, in the past three months they have been consistently wrong. One year ago they predicted that deflation would continue, but now when we start new Monetary Policy framework, inflation rate was negative 0. 5 . Now its positive 1. 3 . So in 12 months, the inflation situation has changed. All right. Plenty more to come on the website as well, cnbc. Com. Well be speaking to the finance minister of indonesia. You can catch that interview in 15 minutes. Also well hear from the indian finance minister in around 30 minutes. And also coming up, could this green van help provide a jolt to the spanish economy . Well be in barcelona with the cars european chief right after this. Now i just found the most expensive house in america has been bought by a hedge more. The New York Post says Barry Rosenstein is paying 107 million for this breach front property in the east hamptons on new yorks long island. Jerry seinfeld is a neighbor and Christopher Brown is of the tweety Brown Investment firm. 140 Million Pounds would make it more expensive, which is now the citys most valuable property, so are we entering another real estate bubble . Can prices go higher for the super rich . Let us know what you think, email us at worldwide cnbc. Com. Or tweet me rosswestgate. Global production of the first all electric van has kicked off. The firm has chosen its firm in barcelona to make the vehicle to span half a billion euros. The spanish plant will be the soul Global Production site for the van which will then be exported around the globe. Joining us is paul wilcox, the european chairman in barcelona. Paul, thank you very much indeed for joining us. How important is this product, is this van . Reporter this van is all electric and the second we brought to europe after the construction of the first one. So this is very important. Yeah, whats the range on this van . How far can you go before you have to recharge it . Because with electric vehicles, that seems to be the key thing . Reporter yeah, the van will run 17 kilometers on a full charge. And the charging infrastructure in europe, we have over 1,000 fast chargers in the european market. And were very confident because of the worldwide usage was that you never use more than 107 kilometers in a day. So we know its a vehicle with great application for many, many commercial operators. So its a massive cost advantage in terms of running the vehicle and charging it is extremely low. This is the plant that will ship them throughout the world, what is your Production Target for the first year . We have a flexible Production Model here in barcelona, but yes, it is global, so this will be the mother plant. The mother plant means the source of the production of exports all over the globe, back to japan and across europe and all markets will take from this plant. Which is obviously very important for spain and very important for investigatement in europe. Clearly this is very important for spain. An economy that is still dragging itself off its knees in place of the financial crisis. And also, the day youre building in spain, which needs an investment, we are also dealing with a rather strong euro. How do you hedge that out and minimize the impact . Bear in mind, its a euro denominated export going for the rest of the world. Well, this takes a very longterm view. Obviously currency fluctuations depend on a monthly basis depending on where you are, so this is specifically because this is a sensor of commercial excellence on this end. So we have a longstanding history and longstanding production plant that we have in europe and it is a sense of commercial vehicle excellence. So we take a longterm view in terms of the commitment. Theres over 100 Million Euros of investment into barcelona and means more products are being brought to barcelona. We have a hatchback coming in the second half of this year, so we are very committed in spain and we have obviously that strong investment. Currency fluctuations impact us every day, but this one takes a longterm view. The most important thing is the quality, the delivery in terms of quality within the product and the consistency in terms of cost. And we know this is almost a worldbreak i worldbreaking facility. And you have an important facility in the u. K. I understand your plant in the northeast produced more than a million cars in just two years, and the first plant to do that. Its a massive plant for a key investment. Are you worried, therefore, by the discussions that are going on in the u. K. At the moment about the eu . Yeah, we dont speculate until we see what is what is actually materializing, so we never speculate on what is happening. The other assumption is that this is the number one car manufacturing plant in the u. K. And half a million cars will be built this year. Again, its a worldclass facility with the highest quality on this end. It competes at a global level. And i actually believe that will continue, but we wont speculate on any kind of physical situations in terms of the eu. The european car industry is struggling with over capacity issues, is that changing . I mean, are we going to see a lot more restructuring for the industry as a whole . Well, i think it has been, obviously, hugely traumatic. The market has been under huge pressure over the last three years. We have seen contraction in europe. We are now starting to see the grinchs recovery. In the last three months we have seen the market recover. So from a european perspective, we see the market becoming a little more stable. This is kind of a unique situation. 80 of the world in europe is regarding brand. And if you look at the southern plant that you just mentioned running on three shifts, we are working on a threeshift patent. So this doesnt have the capacity to do that, but we know the industry has. I cannot comment on all that but the market is becoming more positive. We are seeing demand increase. So certainly from this viewpoint, obviously, more investment in spain with continued focus as we build over a half million vehicles and will sell them this year. Paul, thank you for joining us. Well see what happens with your electric van. Good stuff. Paul wilcox, joining us from barcelona. Still to come on the show, stay tuned to hear what i would kn indonesias finance minister wants to do with the situation there. In headlines around the world, Vladimir Putin and Angela Merkel talk over tensions in ukraine. And could this put the market over the edge . It is tense. It is having an effect in the confidence. It comes at a particularly awkward and inopportune time. The return of portugal. The governor in lisbon will fully return to markets following their bailout measures. And bank of japan tells us that economists are off track and inflation in his cou