12/04/2016 Asia Business Report


12/04/2016

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

:00:00.:00:15.

More evidence of slowing global growth, aluminium giants reporting a

:00:16.:00:24.

big drop in earnings. And concerns arise over Singaporethe date of

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workers in Singapore. Good morning, hello world! Glad you could join us.

:00:39.:00:51.

We kick off with the aluminium giant that has unveiled its results. Alcoa

:00:52.:01:06.

posted a first-quarter net profit of 16 billion US dollars, down 92%

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compared to one year ago. The company has also considered sharing

:01:12.:01:17.

another 1000 jobs. Earlier I spoke with a resource analyst who says

:01:18.:01:25.

earnings beat expectations. If you have a look at the consensus for the

:01:26.:01:31.

period, it was done at 2 cents. So the company certainly beat its

:01:32.:01:35.

consensus estimate. That is why we saw the stock roll up quite strongly

:01:36.:01:42.

overnight. If you are inside that result, they reported $232 million

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of productivity gains, and we certainly think the market was not

:01:48.:01:50.

prepared to see that sort of number. There were certainly some good

:01:51.:01:56.

positives. There were some positives, and of late we have seen

:01:57.:02:00.

rising prices for commodities and a softening dollar. Will this help

:02:01.:02:09.

earnings this quarter? Certainly when we have a look at the corner we

:02:10.:02:17.

are now win, if you have a look at the first quarter of 2016,

:02:18.:02:21.

sequentially the aluminium price for the last quarter of 2015 in the

:02:22.:02:27.

first quarter of this year, the prices are actually fairly stable

:02:28.:02:29.

between the two quarters. We do think that when we have a look at

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the next quarter, that we will see those priced variances starting to

:02:35.:02:39.

reduce or in fact disappearing altogether. That would be a very big

:02:40.:02:45.

positive. Especially given those productivity gains we are seeing

:02:46.:02:48.

inside the company. With rising prices of commodities, this turns

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into rising demand for commodities? We certainly think that at this

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point, commodity prices are very low in terms of the cycle of pricing. It

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is not going to detract too much from the rising demand. We do need

:03:06.:03:09.

that rising demand to see those prices increase, so we would suspect

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that at this point we may get a little bit of a sweet spot, although

:03:14.:03:19.

it will only be small we will see rising demand and start to see

:03:20.:03:23.

rising product delivery inside companies. David Lennox, a

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commodities analyst. One country that has been hit by falling

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commodity prices is Australia, are still views its relationship with

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its biggest customer, China, as the key to its future economic success.

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Australia's economic Trade Minister is in China, and speaking to our

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correspondence. A massive Australian business delegation is in China this

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week. We are talking 1000 people in ten cities, it is apparently the

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largest ever of such a delegation to have left Australia's shores. Even

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in hard times in China, they are hoping to boost China-Australian

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trade. I am the Australian Embassy in Beijing with Australia's Trade

:04:15.:04:20.

Minister. Could you tell us what your take on the Chinese economy is

:04:21.:04:23.

at the moment? We are obviously hoping that China will come to the

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rest you for many countries, including Australia. Is that a

:04:28.:04:34.

realistic? Are you worried about China's economy? We take China as it

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is. There has clearly been a slowdown in growth, from being plus

:04:39.:04:42.

seven to below 7%, but the fact remains that China is still growing.

:04:43.:04:47.

When you consider the gross between six and 7% today on the size of the

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Chinese economy, it's probably the equivalent of up to 13% one decade

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ago. We are still talking about a lot of growth from China. Plus we

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are seeing the rebalancing and transition in the Chinese economy

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towards consumption, which aligns very nicely with Australia's

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interest. Is it possible that the state owned enterprises are being

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loaded up with debt, so many deals are coming out this week and this

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could be short lived if it comes back to haunt these companies? We

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think that the Chinese Government will be able to manage the Chinese

:05:29.:05:32.

economy and that China will be able to continue to expand and grow.

:05:33.:05:37.

Talking about the deals with Australia, how would you measure a

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successful China-Australia week? What could this week bring in terms

:05:44.:05:49.

of investment? In 2014, when we did something similar, we saw from

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delegates that they attributed about 1 billion extra dollars of export

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sales to Australia and about $3 billion of extra investment. I would

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expect to see similar numbers. We want to create the right environment

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that businesses and people need to be able to thrive. Thank you very

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much. High hopes for the China- Australia week. We will be covering

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that in its various stages, culminating in two very large

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banquets on Thursday and Friday when Australia's Prime Minister will be

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meeting with China's top two leaders.

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The World Bank says the demand for loans is increasing. International

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lenders say that loans are attracting about 43 billion US

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dollars in the current financial year, bringing the total for the

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last four years to more than 150 billion US dollars. The

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International bank for Reconstruction and redevelopment

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will exceed more than $25 billion in loans in 2016. Rice is a staple for

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millions of people around the world, but for some, the race itself is

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virtually their only food, leaving them lacking essential nutrients. It

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is acute in many countries. It is being highlighted as a problem among

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many migrant construction workers in Singapore.

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Singapore's migrant construction workers are building one of the most

:07:29.:07:32.

advanced cities in the world. This is what keeps them going. According

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to the social enterprise, a typical migrant worker consumes over one and

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a half kilos of cooked rice one day, but little else. A little bit of

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curry and chicken, normally this large amount of rice doesn't have

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other nutritional food around it. It is a carb diet, meaning they do get

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the nutrition they need, especially for workers doing their daily

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business. They work from 7am to 8pm, and this is arduous work. Workers

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pay around one US dollar a meal. It fills them up, but lacks essential

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items and minerals, which nutrition experts say leads to a form of

:08:31.:08:35.

malnutrition called hiding hunger. So they are fortifying rice with all

:08:36.:08:38.

the ingredients that needs to make it a more balanced meal. Very often

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when you have rice at the start of your diet, you might feel less

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productive or energetic, you might even feel sick. You would feel less

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healthy in general. It would be great if they could eat more food

:08:57.:09:01.

and have a more balanced diet, however that is not likely. It is

:09:02.:09:05.

very simple and cost-effective to add vitamin C this rice. The race is

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being trialled on a small group of migrant workers. Can you taste the

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difference? Yes. It is nicer to taste. By the middle of this year,

:09:18.:09:29.

fortified Rice said they would like to be providing this special rice to

:09:30.:09:36.

as many as 30,000 construction workers. Within a few years, they

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are hoping to be able to feed the entire foreign construction worker

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population of more than 300,000 people. While enriched rice is more

:09:43.:09:49.

expensive, they say they would not be passing on the extra cost to

:09:50.:09:53.

workers. They will be arranging their own delivery. Before we go,

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let's take a look at Asian market action in early trade. You can see

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right now, they are marginally higher. That is due to the rise in

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oil prices and commodities. That is despite Wall Street stocks finishing

:10:15.:10:16.

modestly lower overnight. Thank you for investing your time

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with

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