27/01/2014 Asia Business Report


27/01/2014

Similar Content

Browse content similar to 27/01/2014. Check below for episodes and series from the same categories and more!

Transcript


LineFromTo

their debit cards free time on Sunday. There were also problems

:00:00.:00:00.

with cash machines. Japan has seen worse than expected

:00:00.:00:19.

trade numbers in December, leaving the country with a record annual

:00:20.:00:23.

trade deficit. A ban on beef, we find out more

:00:24.:00:27.

about a Russian ban on beef products from Australia which comes into

:00:28.:00:35.

effect today. Welcome to Asia Business Report.

:00:36.:00:42.

We start today with Japan where worse than expected trade numbers

:00:43.:00:46.

are out. The country is hitting a record trade deficit in 2014.

:00:47.:00:50.

Exports rising less than expected from a year earlier and imports

:00:51.:00:57.

surging 25% due to a week again and rising demand for fossil fuel

:00:58.:01:08.

imports. To tell us more about the state of the country's economy we

:01:09.:01:11.

are joined by Rupert Wingfield Hayes in Tokyo. I think there are two

:01:12.:01:21.

things going on here. There is a struggle shift going on from Japan

:01:22.:01:25.

being a creditor nation to being a debtor nation. That is part of a

:01:26.:01:31.

long-term shift away from manufacturing, the hollowing out of

:01:32.:01:32.

certain manufacturing sectors are being moved to China. Japan is

:01:33.:01:36.

exporting less than it used to. There is also the factor of the yen

:01:37.:01:41.

weakening dramatically last year. A very deliberate policy by the

:01:42.:01:46.

government to boost exports. It has boosted exports by around 10% but

:01:47.:01:50.

not by enough to make for the huge increase in costs particularly

:01:51.:01:55.

energy. This is really tied to the shuttering of Japan's nuclear-power

:01:56.:01:57.

plants after the Fukushima disaster. Japan is now the biggest importer of

:01:58.:02:03.

natural gas, it is a huge importer of oil and coal as well. These costs

:02:04.:02:11.

have gone up very dramatically in the last year because of the weaker

:02:12.:02:14.

yen. What is the government aiming to do about the problem? We have

:02:15.:02:21.

been having a mix, we have seen the Prime Minister trying to

:02:22.:02:24.

aggressively to be led economy can help? They are hoping that this...

:02:25.:02:29.

That there is a lag here. Energy costs are going up immediately

:02:30.:02:36.

because of the fall in the value of the yen. Exports will take some time

:02:37.:02:41.

to pick up. The hope is that this year, we will see a much more

:02:42.:02:47.

dramatic pickup. The other thing there that they are obviously

:02:48.:02:48.

talking about is a need to get power plants back on. And also to

:02:49.:02:52.

diversify and innovate in Japan's energy sector. Liberalising the

:02:53.:02:56.

energy sector, getting more renewable energy generated here in

:02:57.:02:59.

Japan. Rupert Wingfield Hayes in Tokyo.

:03:00.:03:02.

Staying with Japan, the country's Prime Minister Shinzo Abe is

:03:03.:03:05.

continuing his visit to India today. Mr Abe was a guest of honour at the

:03:06.:03:12.

Republic Day parade on Sunday and is joined by a large business

:03:13.:03:19.

delegation from Japan. Japan also announced a loan of $2 billion for

:03:20.:03:25.

the Delhi Metro. Mr Abe's visit marks the ongoing efforts to

:03:26.:03:30.

strengthen economic and political ties between the two countries. Our

:03:31.:03:35.

Delhi reporter explains what is bringing the two countries together.

:03:36.:03:38.

India Republic Day celebrations are seen as a show of might, troops out

:03:39.:03:44.

on display with the latest weapons. More than any kind of military

:03:45.:03:46.

muscle, India needs strategic partners. Here, Japan feels like a

:03:47.:03:50.

natural choice. Both countries have territorial

:03:51.:03:55.

disputes with China and have agreed to boost security ties. India which

:03:56.:04:03.

fought a war with China in the 1960s has been building its military

:04:04.:04:07.

presence on its disputed border to counter a military buildup by China.

:04:08.:04:18.

Recently, Indian and Japanese navy ships has conducted the first ever

:04:19.:04:22.

joint exercises. Economic ties are also improving. Delhi has co-branded

:04:23.:04:28.

economic pacts with Tokyo is the biggest trade agreement India has

:04:29.:04:34.

entered into with any country. Japan's Suzuki Motors has its

:04:35.:04:35.

largest unit in India and is currently the top carmaker. Many

:04:36.:04:41.

feel the potential is much larger with India needing more than $1

:04:42.:04:42.

trillion of spending on infrastructure sector, Japan has

:04:43.:04:48.

been a steady partner. Investing in various projects. The Delhi Metro

:04:49.:04:54.

railway system is one example. The government of Japan has contributed

:04:55.:04:54.

more than half the cost of the project so far. The Delhi Mumbai

:04:55.:05:00.

industrial corridor, a $90 billion project which connects the cities

:05:01.:05:03.

has been funded mainly by the Japanese government and industrial.

:05:04.:05:17.

The World Bank has pledged $2 billion into developing a into

:05:18.:05:21.

Myanmar for projects including energy supply and healthcare.

:05:22.:05:27.

Myanmar has been closed off to much of the outside world for many years.

:05:28.:05:32.

It is struggling to rebuild its economy. The bank seized lending to

:05:33.:05:33.

Burma when they defaulted on payments years ago.

:05:34.:05:41.

Samsung has reached an agreement with Google. The deal extends to

:05:42.:05:49.

deals already owned by the technology giant. No financial

:05:50.:05:57.

details were released. Over to Australia where a Russian

:05:58.:06:05.

ban on beef products from Australia comes into effect today. Russia says

:06:06.:06:10.

it has found traces of a growth stimulant in beef offal from

:06:11.:06:10.

Australia. That is a stimulant prohibited in Russia. There is no

:06:11.:06:14.

international consensus on the stimulant. The ban will affect

:06:15.:06:19.

exports worth more than eight million dollars a year. Our

:06:20.:06:22.

correspondent is in Sydney. I started by asking how worried

:06:23.:06:26.

Australia's beef producers were. The producers are worried about they

:06:27.:06:32.

don't know how long this ban will last for. Russian authorities say

:06:33.:06:42.

that they found traces of trenbalone in shipments of Australian beef

:06:43.:06:46.

byproducts at the end of last year. The ban comes into force today and

:06:47.:06:50.

what we are hearing in Australia is that the Department of agriculture

:06:51.:06:56.

here is working very closely with meat producers to try to impress

:06:57.:07:02.

upon them the very strict guidelines that Russia does have in place.

:07:03.:07:02.

Trenbalone is allowed to be imported into other countries but not Russia.

:07:03.:07:08.

That is why Australian beef byproducts will be banned from

:07:09.:07:14.

importation into Russia starting from today. What is the reaction be

:07:15.:07:15.

like from cattle farmers, beef traders, Australia in general? You

:07:16.:07:19.

have to remember that farming is incredibly important to the

:07:20.:07:22.

Australian economy. Australia is the world's third-largest beef producer

:07:23.:07:26.

after the United States and Brazil. This particular trade in full and

:07:27.:07:30.

byproducts of beef is worth in excess of $8 million each year.

:07:31.:07:35.

About 30 Australian firms are permitted to send beef products to

:07:36.:07:41.

Russia so they are very nervous that this very lucrative trade has been

:07:42.:07:50.

suspended. Russia has been trying to impress upon Australia that this is

:07:51.:07:50.

a temporary ban on that when it is happy, all things being equal, the

:07:51.:07:58.

trade should resume and of course Australia, the Australian

:07:59.:07:58.

agricultural authorities are extremely keen to get this trade

:07:59.:08:03.

reignited, given that as we mentioned for the overall importance

:08:04.:08:04.

of agriculture to the Australian economy.

:08:05.:08:19.

How do you feel about the money you invest? Which assets are you putting

:08:20.:08:26.

your money into? These are questions that will be put to Asian investors

:08:27.:08:30.

in a new survey. The Philippines has the most optimistic investors are

:08:31.:08:34.

helped by the strong economic growth in the country. Investors in Hong

:08:35.:08:38.

Kong are the most negative especially toward shares and

:08:39.:08:41.

property. Optimism has improved the most in Japan with recent gains in

:08:42.:08:50.

the stock market. We have seen good economic numbers

:08:51.:08:57.

coming out of Japan. The Hong Kong story is really very much around

:08:58.:09:04.

property. There has been some concern that property prices are too

:09:05.:09:09.

high. The results reflect that, the opinion of people. The Philippines

:09:10.:09:17.

is a reflection of good GDP growth. Is it really a reflection of that

:09:18.:09:23.

market? Generally the Philippines... We have seen an

:09:24.:09:30.

influx in the last few months. It is also new to our survey. What is

:09:31.:09:37.

striking is also you found that a lot of people are keeping their

:09:38.:09:43.

money. They are hanging on to their cash. Why do you think that is? I

:09:44.:09:49.

think it is a reflection on concerns around volatility and also they do

:09:50.:09:58.

not know where to put their money. You are right, 40% on average of

:09:59.:10:01.

investors around Asia hit their money in cash. That equates to about

:10:02.:10:06.

21 months salary. A number of times more than most investors require to

:10:07.:10:12.

cover their day emergencies. Let's take a look at those markets because

:10:13.:10:19.

they are all in negative territory. In Asia, we saw the yen rising to

:10:20.:10:22.

seven-week highs against the US dollar. That has taken a huge toll

:10:23.:10:27.

Japanese markets you can see down 300 points. That is for this edition

:10:28.:10:42.

of Asia Business Report. Thanks for watching. You're watching ABC news

:10:43.:10:50.

and reminder of our top stories. The UN and to Syria says the government

:10:51.:10:51.

Download Subtitles

SRT

ASS