04/03/2014 Asia Business Report


04/03/2014

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care for vulnerable soldiers. It came after the suicide of Anne-Marie

:00:00.:00:07.

Ellement. Time now for Asia Business Report.

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Up in the air. Will changes to ownership structure help turn things

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around for Qantas? And, the world's most expensive city is in Asia, but

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it is no longer Tokyo. It is much closer to home. Welcome to Asia

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Business Report. We start with breaking news: the reserve of

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Australia has decided to keep interest rates unchanged at 2.5%.

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The Australian government, which has decided to relax foreign ownership

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restrictions on Qantas Airways, days after the national carrier posted a

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record half-year loss. Prime Minister Tony Abbott said his

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cabinet ministers have agreed to repeal legislation that prevents

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other airlines from owning more than 35% of Qantas. And any single

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investor from owning more than 25%. The government could struggle to

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pass the changes through Senate, where opposition parties have raised

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objections to any reforms that could send Qantas jobs overseas. Earlier,

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I spoke to our correspondent in Australia. I asked him whether

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suitors would be lining up for a stake in the airline. The Qantas

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management says it is being hampered by current restrictions. They do

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limit the amount of foreign ownership in the airline. They have

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always said that if the rules were relaxed, foreign investors could

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come in, and Qantas could be extremely profitable further down

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the track. If you look at the events of the past week or so, that record

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half-year loss, about 5000 jobs being lost, it certainly looks

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pretty grim. The Qantas management team is insisting it can turn things

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around, but there are many people here in Australia who fear for the

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future of the iconic national carrier. The airline's request for a

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guarantee on its debt from the government has also been turned

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down. Where else and whom else can Qantas turn to? That is why they

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have been relying on the changing of these laws. Qantas had hoped for a

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line of credit that would make it easier to get hold of cheaper loans,

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and that that would help the struggling airline. There has been

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an enormous debate here in Australia. Many Australians view the

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Flying Kangaroo with a great deal of fondness and a sense of

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sentimentality. They believe Australia should have its own

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airline, but many Australians view it as another business that should

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just stand or fall on its own merits. A large profit coming in at

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$62 million last year. Only a 50% jump from 2012. 80 yard said its

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investment had been key to last year 's growth. -- Etihad. It allows

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multiple carriers on a single ticket. You'll Gates has returned to

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the world richest people least as compiled by Forbes magazine. It

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ousted the Mexican telecommunications mogul. The list

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also showed that the US has the most billionaires - 492, followed by

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China and Russia breaks third. -- ranks. Speaking of wealth and cost -

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Which city is the most expensive and cheapest to live in? Singapore takes

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on the title of the world 's most expensive city followed by Paris and

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Oslo. The cheapest city goes to Mumbai, Karachi and Delhi. Singapore

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has been moving up quite rapidly. It was 15 five years ago. And now it

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takes the number one spot. The number of factors behind that -

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structural is, high costs of cars, entitlements, and also energy and

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water supplies. Utilities? Utilities costs. These structural factors are

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behind the rise. The currency strength makes the city more

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expensive, relatively in US terms. The cost of living in places that

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have great infrastructure - is this a factor must make this isn't one of

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the points. -- this is one of the points. It is a reflection of

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success but it does raise the question of livability. Would people

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reconsider if they can afford to be based in Singapore or Sydney and

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begin to look at other locations. Those at the bottom of the list -

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why? This reflect a different stage of economic development in the

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cities. Lower incomes, lower wage environments. There are more

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moderate levels of household spending. Levels of demand a much

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lower than you will see in the Asian cities we have been talking about.

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There is not the spending, and pressure on prices. As you may have

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heard from a previous bulletins, Russia has tightened its military

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control of Ukraine's Crimea region, with thousands of troops. The US has

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put trade agreements on hold as a rebuke. Stock markets plunged, here

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is the reaction in the They are fairly mixed, after the losses that

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we saw on Monday. Investors considering global recovery against

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that. Why are investors nervous about what is happening in the

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Ukraine? There is more stress in emerging markets. Especially in

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deficit countries about whether the recent disruption to capital flow.

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If you look across the region, there may be countries stressed. There is

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the issue of energy supply and costs will stop that would effect any

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country. Looking at the energy supplies, Russia is the largest

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producer and top exporter of national gas in 2012. Do we expect

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this to rise? The concern for Asia is that if we have a repeat of 2007

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2008, it puts our lot of stress. It stresses that the government budget

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and it may spiral with wages going up. The reason a lot of risk for the

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region. In Sri Lanka a severe drought is affecting the country 's

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main rice harvest and it could also affect it quality. This irrigation

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channels have been dry for weeks. Paddy fields have been left fallow.

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The crops depend on one short monsoon, and it just didn't happen.

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This should be a reservoir, three metres deep and capable of

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irrigating for 40 farmers. Now look at it pitiful state. The failure of

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the range from October to December mean that only seven of the 40

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farmers felt able to plant anything, and only two of them are likely to

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get any paddy at all. Farmers have tried to channel the scarce water

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into pools, but it has been almost useless. This man planted four

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acres, and all was lost. These may look green, but there is no grain,

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just husks. TRANSLATION: We have borrowed from banks. We are at track

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rent and are heavily in debt. We have lost our livelihoods. Because

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of the drought, we can't find labouring work. This man is tending

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his seedlings. These are watermelons. He gives them a little

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water from a makeshift dam, but this is an emergency crop. He has fallen

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back on it, because thanks to the drought he can no longer grow rice.

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Three quarters of the seedlings have died as well. TRANSLATION: We just

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can't plan for the future because rain is so unpredictable. It is the

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same story in the upland key country. This tea is dead. Workers

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have become water is, a highly unusual move. -- waterers. The owner

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says it is the worst drought since 1993. Two thirds of our crop has

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come down very badly, and we used to bring 35 or 40 kilos per day, it has

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come down to 12 or 13 kilos. The plants are wilting. Sri Lanka is the

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fourth largest producer of tea. People are praying for rain in the

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few weeks time. While in the drylands, even the wildlife is

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nothing to it. That brings us to an end to this

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edition of Asia Business Report. Thank you for watching. Headlines:

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Russia is denying claims its troops are preparing a full-scale assault

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on Premier but says its forces will remain in Ukraine so now. After

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top-level

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