08/05/2014 Asia Business Report

Kent. Now on BBC News, all the latest

business news live from Singapore. Thailand names and new caretaker

Prime Minister. Will it help turn around the country's battered

economy? The chiefs from Hong Kong's biggest property developer go

on trial. Welcome to Asia Business Report. I'm

Rico Hizon. Thailand has a new interim leader. The caretaker Prime

Minister. A court has ordered to step down after finding her guilty

of abuse of power. This move extends the political crisis, which had led

to violent protests and brought the economy to a standstill. Further

uncertainty on Thailand's political leadership proposes a threat to

future investments. The economy has already seen a slump in tourism and

a slowdown in domestic demand. Earlier I asked how the latest

developments will be perceived by the international business

community. I suspect they will be doing it with a degree of despair.

What it means in the immediate term is probably more protests on the

streets of Bangkok. It will almost certainly mean for perhaps the next

six months a continuation of the government's inability to transact

with investors. Everything is on hold. But I suggest they should look

deeper, because what happened yesterday was a full`blown judicial

coup. That would have been quite catastrophic in terms of the degree

of violence and disruption it would have brought to Thailand. You say

more protests and instability in the medium term. How should the sisters

and investors manage the risks in Thailand? They will have to play a

long game. Yesterday we saw the beginning of the end of Thailand's

long`running stand`off, the latest round of which began last December.

We are seeing signs of a path out of this problem. It might seem negative

that Yingluck Shinawatra has been forced out, but what remains is the

majority of her Thai government. In the next day or two we will see a

decision on whether the July general elections go`ahead. If we see that

made, investors should take solace from it. It is a path towards not

necessarily a political solution but an accommodation that should see

business function much better. In spite of this uncertainty, the

political in certainty, has been uncertain. `` uncertainty. It is

known for its resilience. This time around, the length of the stand`off

has been more damaging to the economy than before. The coup cycles

of Thai history have been short and snappy. What we are seeing is

effectively the failure of a judicial coup. So, the opposition

are going to keep picking away at the saw, which is in their opinion

the clan's control of Thai politics. `` the sore. That will niggle at the

economy. Hong Kong's biggest ever corruption

trial begins today and there are some deep names taking the stand.

The city's Brothers, the world's most successful property developers,

are being prosecutors, as well as the man who used to be Hong Kong's

second most powerful politician, after the Chief Executive. Here are

the details. The Kowk Brothers `` Kwok Brothers

are the billionaires behind the listed Hong Kong property firm,

responsible for some of the largest and most iconic buildings in town,

including the IFC. They will face a judge over various charges,

including conspiracy to commit misconduct in public office. One of

the brothers faces another charge, of supplying false information.

Essentially they are accused of bribing the former number two in

Hong Kong government over a number of years. He faces eight charges,

including misconduct over a 10`year period. The brothers are accused of

supplying cash, as well as insecure loans, and providing the use of

several flats to Mr Hoy over several years. In `` if convicted, they face

several years in prison. They were arrested several years

ago. As the case had any info `` had much impact on this is in Hong

Kong? They have maintained this has had no bearing on their business.

They have brought in a number of outside businesses, including the

sons of the two Kwok Brothers. And they have been aggressive in terms

of expanding their property business, both in mainland China and

also in Hong Kong. But of course we know that their shares fell

dramatically just after they were arrested. Two years later, those

shares simply haven't recovered. The trial kicks off in about 25

minutes, 10am local time. We will spoke to our correspondent again.

Also for the latest update on the court proceedings, you can follow us

on Twitter. Elsewhere, the Court of Appeal in

Vietnam has decided to uphold the death sentences given to immoral to

former executives of a state shipping company. They were found

guilty of embezzling over $1 million.

Japan's Nintendo has booked a four`year loss of $230 million,

reversing a profit from the previous year. Famous for its video game

consoles, reduced sales in their Wii products were to blame.

UK mobile carrier Vodafone has had a tax dispute totalling more than $2

billion. Both sides failed to find a solution through negotiations. The

dispute `` comes from Vodafone's acquisition of Indian mobile assets

into a dozen seven. The Supreme Court of India ruled in 2012 that

Vodafone did not have to pay any tax on the deal. But, later that same

year, the government changed regulations, allowing it to impose

taxation on deals that have already been concluded.

Air Asia says its joint venture in India has allowed an operating

permit that will allow the airline to launch its services in a highly

competitive market where most carriers are losing money. India

currently has five national airlines and one regional carrier. Kingfisher

Airlines, rounded in 2012, was due to mounting debts. `` grounded. For

more on that story and others, please visit our website.

Japan and the US have made good progress on trade talks, known as

the transpacific partnership. That's according to the Japanese economic

policy minister. The man credited with turning around the Japanese

economy says he is confident that a deal could be reached soon. The two

nations are the biggest economies out of 12 trying to negotiate this

trading agreement. On a visit to the UK, he spoke to Alp business

correspondent and asked him about the importance of this trade

negotiations. `` our. TRANSLATION: For Japan, it is agricultural

products. For the US it is automobiles. These are considered to

be sensitive items. It doesn't mean it has already concluded. We agreed

on an equation, a framework, to reach that conclusion. In a way it

could be said as a type of breakthrough. Because if Japan and

the US can come to an agreement, the negotiations with other countries

will progress significantly. Japan has a mind`boggling amount of debt.

The debt... Japan owes more than 2.5 times the amount it creates every

year. That is higher than Greece or much higher than other countries. If

interest rates around the world start to rise, which many people

think they will and in fact in some countries they have already started

to do so, is that not a nightmare for Japan? Because of the sheer

amount of debt we would have to service? That would eat up all of

the government revenue? TRANSLATION: And's long`term debt level, the

government debt level, is close to two times GDP. So, if there is an

increase in interest rates, this is going to be and in `` a very serious

situation for Japan. We need to boost the credibility of the central

bank. And we need to present the government's Strong will for fiscal

consolidation. We need to create a plan for fiscal consolidation. The

government has a strong will for fiscal consolidation and it has also

presented its plan. In Europe, a certain country is focused on

austerity towards fiscal consolidation and it has failed.

Because what you need to do is cut the waste in your fiscal policy and

make it efficient. But at the same time you do need a growth strategy

to increase revenue. You need a combination. That's what Japan is

doing. We now enter this edition of Asia Business Report. Thanks for

investing your time with us. `` end this edition.

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Russia says