25/03/2016 Asia Business Report

Billions at his fingertips. We speak to the man who will decide where the

Asian infrastructure investment bank will spend its money. And how the

slowdown in China is taking the wind out of the sales of the world's big

shipyards. Hello and welcome to this Friday edition of Asia Business

Report. The new Asian infrastructure investment bank has been described

as the big rival to the World Bank and the IMF. It is a new global

lender to give China more clout on the world stage and despite

criticism from the US, most countries have joined. We spoke to

the bank's president who has dismissed concerns about the bank's

independence and standards. Some people say, just because China is

the biggest shareholder, this will become the instrument of the Chinese

diplomacy. I'm sorry, let me ask you a question. The US is the biggest

shareholder of many institutions, do you think they are the instrument of

US diplomacy? Japan is a big shareholder also, do you think this

is Japan's bank? I would say no. So I think the biggest thing is to see

whether the biggest shareholder lives up to expectations placed on

it by other fellow members. Let's pick up on that point. There are

concerns the bank won't have the same standards on human rights,

corruption and environmental protection like other international

financial institutions. The World Bank for example. What would you say

for that? What is the ground for this kind of assumption? I think it

is not appropriate to make assumptions without looking at the

fact. We went through rounds and rounds of consultations with

shareholders, civil societies and NGOs and look at the governance

structure of this institution. So if people are familiar, if they have

acquired some knowledge about everything I mentioned, and if they

still think this bank will not have very good governance, what can I

say? The recent stock market volatility and the economic

slowdown, has it affected the ability of this bank to fund the

loans you have talked about in the past? 10-$15,000,000,000 as the

target of the next couple of years. No, we are not affected at all. We

are fully funded by the shareholders, $100 billion

registered capital traded him in five years time. -- in. He will have

payments. The volatility in the Asian market or the stock market

volatility will not affect our operations at all. Do you think it

is a mistake that the US hasn't joined? Does it risk being left out

of this new institution? The door has been opened and the door will

remain open. So why do they call this a mistake? It is simply, in my

view, a decision yet to be made. Today will be the very first day of

trading at Myanmar's new stock exchange. It was launched a few

months ago but nothing much has happened since then. No company has

been enlisted so zero trading on the ground floor. As of today, one

company will be trading. Let's hear about whether it is time to be

bullish or bearish. There has been something of a rush year in Myanmar

to get things finished before the new government takes office next

week, basically so the old guys can take the credit. That the stock

exchange has made it just in time. One type of stock will be traded on

the first day, a company called FM I which is one of the big Roman or its

-- conglomerates here, running an airline and some of the hot balloons

that run over the temples. But this place is not going to be like New

York or London, it is going to be sleepy. Very sleepy. Five more

companies are being lined up to join the stock exchange in the near

future and the hope is that this will prove an important source of

funding for an economy that looks set to grow strongly in the next few

years. In other business news, and earnings warning has been issued for

Sharp. The Japanese electronics giant says annual earnings could

fall short of the earlier predictions. Losses could be in

attendance to -- could be in the tens of millions of dollars.

Taiwan's central bank has lowered interest rates to 1.5% in order to

prop up its faltering economy, even though the bank expects growth to

pick up this year. Growth was expected earlier. The cost of living

in Japan remains completely flat as of February, well below the

government poll of 2%. Some believe prices could fall by as much as half

a percent by the end of the year which could put pressure on the

central bank in July. Revised figures from South Korea show its

economy rude to .6% last year which is the slowest pace since 2012 --

grew 2.6%. This presents a huge challenge for policymakers that it

reflects weakness in domestic demand and a downturn in exports. Our

correspondent says it is a wake-up call for South Korea. The growth

rate has been declining from wonderful historical rates of 8% and

more for over 40 years. We have now dropped below the world average and

are the losing side of the world economy. Korea needs to retool its

economy and it is about human capital, preparing people for new

challenges with better education and vocational skills which will allow

them to participate in the world of the future. A century ago, the

world's big shipyards were in Europe but now they are in East Asia,

China, Japan and South Korea. Falling global demand is now hitting

them hard. We just heard about how difficult the outlook is for Seoul.

Our correspondent went to the shipyards at the tip of South Korea

to find out more. Here is one way to save money. A robot welder. This

machine goes up and down the wall of the liquefied glass container inside

the ship. The laser spots microscopic gaps which are then

welded together. Highly skilled humans used to do this important

work. One error in these tanks would be explosive. A leak of gas would

blow the ship skyhigh. But these machines do the job and they don't

demand wages. We achieve the high quality and productivity we need and

we hope that our experts will carry on observing. Of the global

shipbuilding industry is in the doldrums. Slow growth in China means

that fewer new bigger vessels to carry iron ore and coal. Fewer

container ships are needed to carry Chinese goods to the world and the

rock-bottom oil price means fewer building of deep-sea ocean

exploration vessels. You notice it here in the towns around the yards.

This is a town on an island on the tip of South Korea. It was a magnet

for Western shipbuilding experts. The decline of Europe's yards and

the rise of Asia's brought them here. In this international sector,

the ex-pat ladies play cards. But they are worried. Projects are

coming to an end and their time may be up. Because of the downturn in

the oil industry, many families have left and many families have noticed

to leave. We have noticed the financial aspect of the community

has slowed down. We don't know what is going to happen with employment.

Shipbuilding is a global industry. People move where the work is and

they move out when the work isn't there. Their families and pets have

to make the best of it. Let's take a quick look at the markets. It is

fairly quiet as a number of markets are shut for Easter. But Japan and

Korea are trading and are currently flat. Japan has been underwhelmed by

the inflation numbers. That is all for this edition of Asia Business

Report, thank you for