03/07/2014 Asia Business Report

in the UK. Now on BBC News, all the latest business news live from

Singapore. China's president heads for South

Korea. Will they finally agreed to a trade deal? And India is taking

steps to combat food wastage caused by improper storage and transport.

Welcome to Asia Business Report. The economic relationship between South

Korea and China is likely to be high on the agenda when the Chinese

president touches down in Seoul today. Trade between the countries

tops or than $270 `` 200 $70 billion US. Foreign investment is around a

quarter of that. The two sides have been in talks about a bilateral

trade agreement. Will is there a likelihood of this passing during

this trip? `` was there. From South Korea's perspective,

getting a free trade agreement done is a top priority. South Korea has

been urged to join a multilateral trade agreement with the US and Asia

but the President Kiir has made it clear that China is going to happen

first. `` the president has made it clear. They have had about 12

meetings and upcoming close to a deal. That's part of what they are

looking forward to pushing forward with this visit. Again, the Chinese

president will be accompanied by a delegation of about 100 Chinese

businesses. What kind of deals are you expecting to come out of this

visit? He will spend much of Friday afternoon at an investment forum.

But we have already seen a battery making company, within LG group,

announcing that they will be opening a new factory in China over the next

year or so. Those are the sorts of agreements that both sides want to

see. Samsung Electronics of course is the big smartphone maker and they

have big plans. A lot of that foreign investment you will see.

That's the kind of thing they want to strengthen. In other business

news, Peugeot plans to build its fifth factory in China. Its to ``

two ventures in China will produce an additional 300,000 vehicles a

year starting from 2016. Malaysian Airlines may be taken private by its

largest shareholder. The state investment fund owns about 70% of

the company and is reportedly examining different ways to fix its

fortunes. Malaysia Airlines has been losing money for several years and

its finances have worsened, following the disappearance of

flight MH 370. Rare earth elements are difficult to get out of the

ground and process. An Australian company has a rare earth processing

facility in Malaysia but it struggles to contain local protest

over potential environmental and health impacts. Despite the

controversy, it plans to move headquarters to Malaysia from

Australia. Earlier, I asked our correspondent what they to that

decision. This is part of a bigger plan for them to cut costs. In

addition to moving their head waters, it also says that they will

be cutting some jobs, mainly contract positions. Also they are

looking to renegotiate supply contracts as well. They have been

facing a very tough two years because Brett the metals, although

very precious, the prices have dropped significantly. `` rare earth

metals. And they haven't been able to boost their out with a Malaysian

plant. That's because of various reasons but one of them of course

being the various protests from environmental activists and

residents. Has there been any reaction from the

environmental protesters, as well as the residence, in terms of this big

move? They see the move as probably...

They have mixed reactions. `` residents. Some believe it's a bad

sign, that the company is here to say. Perhaps a show to investors

that they are considered and will be able to get licence renewal, which

activists say will be coming up shortly. Others say it could be

better for them, the fact that the company is here, and that might make

it easier for them to lobby. Despite its name, rare earths are not very

rare to mind. But it's a very messy process to refine. `` to mine.

Malaysia has been one of the first places to face this Chinese company.

Before Indonesia's election, the race is getting very intense as the

two candidates are now almost neck to neck in the polls. While the

candidates are battling it out, some small businesses are cashing in on

the spirit of the elections. We report from Jakarta. I'm in a

traditional market in central Jakarta and all around me there is

merchandise display interfaces and logos of the two Indonesian

presidential candidates, Joko Widodo and Prabowo Subianto.

They are everywhere. On T`shirts, cups and even on things like these.

This man has been selling goods here for 25 years and it's never been so

busy. TRANSLATION: I've been selling Acra one merchandise since 2012 when

he ran for governor. `` Joko Widodo merchandise. His products have

picked up. I also sell products from Prabowo Subianto boat I only started

selling them recently. These bags are in high demand. The buyers are

from all over the country. In fact, somebody even bought these bags to

take them to Hong Kong and give them to the Indonesian migrant workers

there. Shopkeepers here say that although sales are good it is still

difficult to attract customers. They are all in fierce competition, just

like the candidates, to reach out to the most people.

India is the world's second`largest grower of fruit and vegetables,

after China. But some estimates say 40% of all fresh food produced in

India is wasted because it rots before it can get to customers. A

major cause is the lack of cold store facilities. As part of our

series on global food wastage, we look at what's being done to try to

tackle the problem. This is one of Asia's largest

wholesale markets. It in their Indian capital. `` in the.

Truckloads of produce arrives every day to be auctioned and sold at the

best prices. This farmer has driven eight hours from a village in a

neighbouring state, bringing his harvest of potatoes. It's a long

trip that might only as much as $3000. `` earn him. He says he has

no other choice. TRANSLATION: Once we harvest our vegetables, we just

don't know what to do with them. We need to sell them past or they are

just going to rot. We don't have large markets in the village, so I

have to pay for them to be transported all the way to Delhi.

More food is brought here than ever before to

cities. The conditions haven't really changed in the last few

decades. This reflects one of the biggest threat to India's food

security. In proper storage means nearly 40% of what the country's

produces perishes, even before reaching consumers. Despite being

the world's second biggest grower of fruit and vegetables, India throws

away fresh produce worth about $7 billion every year. This is one

solution. India has just over 6000 facilities like this. Only a

fraction of what it actually needs. So, providing technology for climate

controlled warehouses is proving to be a good business for companies

like this. The price of milk per litre potentially could go down by

up to 40% if wasting was reduced. For fruit and vegetables, prices

could be potentially halved. For a country of 1.2 billion people. `` if

you can bring down pricing, it's good for everyone. India's inability

to keep much of what it produces edible means many are left hungry.

Unless it invests in modern warehouses and cooled trucks, or

perhaps tempt foreign giants to make investments for them, the problems

of hunger and food prices are only going to get worse.

A quick look at Asian shares because they are mostly flat. The Nikkei and

cost be mostly flat. `` Kospi. Caution ahead of the crucial jobs

data out of the US. Thanks for watching.

The top stories this hour: There have been violent clashes in east

Jerusalem following the killing of a Palestinian teenager. Many fear it

was a revenge attack for the killing of three Israelis. The US demands

tougher security at foreign airports. There's alarm over a

possible, new, undetectable Al Qaeda bomb.