23/03/2016 Asia Business Report

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

We look at the impact of China's new normal on workers as government and

business leaders meet at the forum. And how young people are finding new

ways to move up the corporate ladder in Japan.

Welcome to this Wednesday edition of Asia Business Report.

A forum, loosely referred to as the Chinese Davos, kicks off this week

and this year government and business leaders meet against a

backdrop of slow growth and fewer jobs. For more we can go live to our

correspondent at the forum in China's Hainan province. Tell us

what you have heard and seen. This is very much an annual gathering of

the political and business leaders in China and also from around the

region. It is an impressive list over the next couple of days. We

expect the Chinese Premier to make a speech here. We are not expecting

anything ghastly different from the comments he made at the National

People's Congress two weeks ago. The focus of this forum at the top of

the minds of many is how China is going to manage this transition.

That is from an economy dominated by manufacturing and investment into

one that is more focused on services and innovation. I travelled to

southern China to find out how one company is making this transition.

China's army of workers, the winning formula behind its success... So

far. This country got rich being the factory of the world but that is now

changing. Chances are some of the products you have in your house had

been made here. It produces half of the world's goods but now this

country needs to make a transition beyond the factory floor. The

government says it is already doing this but what it is not saving is

the price it has to pay for this transition. Millions of workers

could be left out -- saying. A Entertainment is new China's poster

child, manufacturing toys was once how it made its money, but its

future lies in this. Alpha wants to be Asia's Disney, creating cartoon

characters that have become household names. It is now China's

biggest household entertainment. Alpha's boss is catering to China's

middle classes, selling them everything from cartoons to cafes,

but there is a sacrifice. TRANSLATION: Today in China we are

seeing structural reform in business. Those will see opportunity

to develop. For those who can't adapt, they will have to shut down.

It is a challenge Beijing is trying to manage. At the recent party

congress the government said millions of jobs would be created

this year and it has launched a $15 billion fund aimed at workers who

have lost their jobs. But this transition isn't going to be easy.

Another day, another shift ends. Factory life has given millions of

workers a shot at the Chinese dream. As China makes this transition, so

will adapt, but many more will struggle to find a place for

themselves in the new China. Now, you talk about a new China, and

this need to adapt. This meeting comes against the context of a

slowdown in the economy. Tell us about what's on the agenda and what

people will be talking about? Very much the transition you have

mentioned. Innovation is a key focus at the forum. We will see the likes

of the CEO of Uber, his Chinese counterpart, the man who runs a AB

-- AirBnb and China's manager of AirBnb. Innovation at the heart of

seminars taking place at the forum. In fact, even as I speak, in the

conference room behind me there is a discussion about global economic

governance and later today currency war is high on the agenda as well.

It sounds like a couple of easy days. Thank you. Members of the oil

cartel OPEC will meet in coming weeks to discuss a freeze in output

at January levels to try to stabilise the global oil market. Oil

prices have staged a turnaround following a fall below $30 a barrel

in January. Let's see what they are doing. You can see they are trading

at around $41 although there are concerns of oversupply with a report

out overnight showing US crude stocks rose almost 9 million barrels

to reach a record high. I asked Neal Atkinson, head of the oil department

at the international energy agency where prices are headed next.

Meeting at the January period it will be at the bottom. It is

forward-looking, oil markets. There is still a lot of supply. Into the

second half of 2016, the oil market starts to move closer to balance. If

it doesn't yet balance, there would be a surplus of supply over demand

but it is heading towards balance and in 2017 we think the market will

balance. There is if you like a platform for prices to build from

although we are not expecting prices to rise dramatically anytime soon.

April 17 is the date everyone is watching out for, went OPEC

producers meet. Will Saudi Arabia's agenda to keep production fairly

high and to keep prices low and as a result drive out US shale

producers, will that still be the theme? -- when POEC producers meet.

That has not turned out to be as simple a task as they might have

imagined when they took their decision to go for market share

rather than support prices. As far as the upcoming talks are concerned,

it is not entirely clear what format they are taking place in -- OPEC. As

far as we are aware there isn't an official OPEC initiative as such.

There is an initiative among the producers, including Saudi Arabia,

Russia and others to put a stop on the prices, suggesting that prices

won't rise further, although there is suggestion that countries

involved in these talks couldn't increase oil production even if they

wanted to. I think there is more symbolism than actual reality in

terms of affecting the oil supply around that. Neal Atkinson. In other

news, profits at New Zealand's dairy giant Fontera jumped 20% in January

to $276 million, boosted high load global milk prices, reducing the

ingredient cost for consumer products at the biggest exporter of

New Zealand, but those prices have seen farming incomes slashed by

billions in the last two years -- lower global prices. In Japan, the

more money you get, the more money you own as long as you stay with the

same employer - at least that has been the norm. Recently, companies

have been experimenting with a different model were working salary

is based on skill and not seniority. As part of the study in Japan

series, we look at whether the approach is paying off. Out on the

street, 29-year-old Kataku has his groove, but in the corporate world

he had a frustrating start. He knew that his turn for a promotion and

pay rise was decades away. There was a long line of older workers at the

company who needed to be rewarded first. For Japan Inc, that has been

the tradition for over half a century, so he quit his first job

and joined an online media and advertising firm in 2013. Within two

years, he rose through the ranks to become a manager. TRANSLATION:

Initially, I was surprised to have staff who were older than me, or to

have a boss who was younger than me but I like the fact that CyberAgent

rewards its workers based on performance, not on age. This man is

in charge of human resources at CyberAgent. TRANSLATION: Many of our

executives worked at companies where the oldest at the biggest salary. We

all felt that was unfair. This model means more competition. It is

natural for all the staff to feel awkward, to see younger colleagues

promoted first, but because it has been policy from the start I think

it was easier for us compared with older companies. During Japan's

economic boom of the 80s and 90s, companies could afford to keep

raising salaries for older workers as a reward for their loyalty, but

since the economic bubble burst even household names like Panasonic and

Sony had to reconsider their policies - jobs were cut, which

shocked Japanese workers who were expecting the guarantee of lifelong

employment. TRANSLATION: It is like a couple who just found out that

your partner was cheating on you. They are feeling betrayed. But

companies which revised their policies have not all been

successful, because unless you can turn your business around you are

just creating unhealthy competition among your employees. For young

companies like CyberAgent, the new salary model has so far paid off.

And its success is what the rest of Japan Inc is also hoping to achieve,

but it is much trickier for bigger and older companies to adjust to the

new economic reality. A quick look at the markets and this

is where they are trading right now, fairly neutral reaction to the

Brussels at a. That is it for this edition of Asia Business Report.

Thanks for watching -- Brussels