20/01/2014 Asia Business Report


20/01/2014

Similar Content

Browse content similar to 20/01/2014. Check below for episodes and series from the same categories and more!

Transcript


LineFromTo

dead in Fife will appear in court later today. Time for Asia Business

:00:00.:00:00.

Report. It's official, China's economy is

:00:00.:00:21.

slowing down. We will look at the implications. A bank account for

:00:22.:00:26.

every adult in the country. India's bold ambitions. Welcome to the

:00:27.:00:46.

programme. China's economy expanded by 7.7% in the final three months of

:00:47.:00:53.

last year, the same as in 2012. It exceeds the government's target of

:00:54.:00:56.

7.5% but they are the worst the country has seen in 14 years. Thank

:00:57.:01:11.

you for joining us. Is this good news or bad news? Well, I think this

:01:12.:01:19.

is a positive development that the market should be welcoming. China

:01:20.:01:28.

requires this slowdown. We expected growth to slow in the fourth quarter

:01:29.:01:32.

and we have got that. People need to get used to a new way of thinking

:01:33.:01:36.

about Chinese growth. It is going to be slowing down in the coming

:01:37.:01:42.

years. It won't be a straight line but growers will be slow and not

:01:43.:01:54.

just as a downshift but as a continual deceleration. Are the

:01:55.:02:03.

Chinese party leaders going to be pleased with this? They are trying

:02:04.:02:07.

to tread a difficult line. The leadership believes it needs a

:02:08.:02:12.

certain amount of growth to keep employment up. And growth targets

:02:13.:02:15.

has always been about making sure there is enough growth to keep

:02:16.:02:20.

employment robust but as you change your economic model, as things shift

:02:21.:02:25.

more towards services, you can still have robust employment growth even

:02:26.:02:31.

if GDP slows down. It just means you have a weaker headline great number.

:02:32.:02:36.

They may not be pleased about the number. We may not be pleased about

:02:37.:02:41.

the slowdown but the fact that they are accommodating it is a good

:02:42.:02:47.

thing. One final question. What does this mean for the rest of the world?

:02:48.:02:52.

Lots of foreign investors might be thinking... We deal with companies

:02:53.:03:06.

who have a heavy footprint in China, multinational companies. For those

:03:07.:03:13.

companies, we think this slowdown will help them from various

:03:14.:03:16.

standpoints. The most important one is it will help level the playing

:03:17.:03:21.

field. Right now, large, state-owned Chinese company 's can compete on an

:03:22.:03:25.

uneven playing field because of heavy government support. As the

:03:26.:03:29.

economy slows, we expect some of that support will have to be drawn

:03:30.:03:32.

back because government resources will have to be diverted to other

:03:33.:03:36.

areas. From a foreign investment perspective, we should not be too

:03:37.:03:41.

worried about this. In fact, it's a positive thing in the long-term. The

:03:42.:03:45.

transition for the Chinese economy might be difficult but there is

:03:46.:03:48.

something of a myth that China drives global growth. It does not

:03:49.:03:53.

really drive global demand because other countries are buying from

:03:54.:03:57.

China. China drives a lot of commodity demand but in general, a

:03:58.:04:00.

Chinese slowdown will not affect other markets too heavily, apart

:04:01.:04:05.

from the heavy commodity producers like Brazil and the Middle East.

:04:06.:04:19.

Chinese GDP in the last quarter has increased 7.7%. Nintendo shares have

:04:20.:04:26.

fallen by more than 18% of -- after the company said it would be posting

:04:27.:04:36.

another loss. The game maker has cut down its sales forecast for the

:04:37.:04:41.

latest Wii by 17% and as a result, it expects to post an operating loss

:04:42.:04:46.

of more than $300 million. That's compared to an initial forecast of

:04:47.:04:52.

profit. Taiwanese manufacturers are also struggling with profit. One

:04:53.:04:59.

company has posted a net loss of millions of dollars. It also said

:05:00.:05:04.

its senior executives will take a 30% pay cut. India's banking sector

:05:05.:05:15.

is one of the government's priorities for 2014. It has already

:05:16.:05:20.

got plans to give out more banking licences and improve finances in

:05:21.:05:24.

rural areas. A new plan has been put forward to give every adult Indian a

:05:25.:05:28.

bank account by 2016. Is that feasible? This man is 60 years old

:05:29.:05:38.

and he has never had a bank account. He sells vegetables to make his

:05:39.:05:41.

living from this shop just outside of his home. It's hard for him to

:05:42.:05:47.

save very much but whatever he does is kept in his home. TRANSLATION:

:05:48.:05:55.

The nearest bank is about one hour 's walk away. There are some private

:05:56.:05:59.

lenders slightly closer but I cannot trust them with my money. If there

:06:00.:06:03.

was a government bank closer to home, I would deposit my savings

:06:04.:06:06.

there but right now, it's not worth my time. This is a suburb of Mumbai

:06:07.:06:13.

and yet many people do not have bank accounts simply because there is not

:06:14.:06:17.

a bank branch that is close enough. In fact, around one third of the

:06:18.:06:21.

Indian population has no access to bank accounts. Now, there is a

:06:22.:06:26.

proposal to change that and bring more people from low-income houses

:06:27.:06:29.

like these into the formal financial system. An expert panel set up by

:06:30.:06:35.

the Reserve Bank of India has recommended that special banks

:06:36.:06:39.

should be opened, focusing on those making smaller amounts of money. Why

:06:40.:06:44.

2016, every adult Indian should have a bank account. -- by 2016. That is

:06:45.:06:51.

a big target. The country is home to more than 1.2 billion people. In

:06:52.:06:56.

2010, India launched a massive scheme to give every person a unique

:06:57.:07:02.

identification number, a process that is still under way and likely

:07:03.:07:06.

to be completed next year. The central bank's panel believes that

:07:07.:07:10.

if bank accounts are links to this unique ID number, 2016 may be an

:07:11.:07:18.

achievable goal. But to really get people to use these accounts,

:07:19.:07:20.

thousands of new bank branches would also need to be opened and its

:07:21.:07:24.

customers are only depositing very small amounts, there are questions

:07:25.:07:28.

about whether these branches would be financially viable. They are

:07:29.:07:34.

ambitious goals but achieving them, many believe, is key for equitable

:07:35.:07:40.

growth in the country. The slowdown in China has prompted investors to

:07:41.:07:46.

look to other parts of Asia. South East Asia's largest art show took

:07:47.:07:49.

place in Singapore, highlighting a growing interest in artist. I am at

:07:50.:07:59.

South East Asia's largest art show, with over 150 galleries from around

:08:00.:08:04.

the world showcasing art as diverse as installations to traditional

:08:05.:08:07.

forms like painting and sculpture. But the question for a would-be art

:08:08.:08:12.

collector or investor is, with such a bewildering array of choice, where

:08:13.:08:17.

do you start with art? It's a question I put to and avid

:08:18.:08:22.

Singaporean collector of south-east Asian art. I have been collecting

:08:23.:08:36.

for many years and somehow, I stay with south-east ASEAN to simply

:08:37.:08:40.

because it's familiar territory. -- south-east Asian art simply because

:08:41.:08:47.

it is familiar territory. South East Asia as a country is still quite...

:08:48.:08:54.

-- as a region is still quite in its infancy in terms of the value of

:08:55.:09:00.

art. In this region of growth, as we become wealthier, art will surely

:09:01.:09:09.

appreciate in South Asia. He will be pleased with what is on offer. Art

:09:10.:09:16.

from South East Asia dominates this year's fare, with Indonesian pieces

:09:17.:09:21.

like this one taking centre stage. Record-breaking prices for Chinese

:09:22.:09:24.

art in previous years has overshadowed offerings from

:09:25.:09:30.

elsewhere in Asia. But a suspected slowdown and a clampdown on luxury

:09:31.:09:34.

spending their mailing to a shift in interest. -- may lead to a shift in

:09:35.:09:44.

interest. We achieved growth of over 30% and one of the success stories

:09:45.:09:49.

was south-east Asian art, which has seen a lot of new interest,

:09:50.:09:53.

regionally and internationally. And that is a result not only of the

:09:54.:09:58.

growth of the economies in Asia but also, as those economies grow and

:09:59.:10:05.

Asia becomes very much part of everybody's mindset, there is more

:10:06.:10:07.

international interest in what happens here. Investors are taking a

:10:08.:10:14.

serious look at art from this part of the world, and interest that was

:10:15.:10:18.

reflected at the show where many local artists sold out on the first

:10:19.:10:38.

night. Thank you for joining us. This is BBC News. The headlines:

:10:39.:10:43.

Both the US and Syria's main opposition group have voiced their

:10:44.:10:46.

disapproval of Iran's invitation to peace talks, which begin in

:10:47.:10:50.

Switzerland this week. The Ukrainian president will convene a special

:10:51.:10:55.

cross-party commission to try to resolve weeks of political

:10:56.:10:56.

Download Subtitles

SRT

ASS