06/05/2014 Asia Business Report


06/05/2014

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new evidence comes to light. The Sinn Fein leader denies any

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involvement in the kidnap and murder of Jean McConville. Time for Asia

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Business Report. Economy versus politics, what role

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will be central bank lay ahead of Australia's Budget. The Filipino

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economy, we look at the impact of rising prices on future growth.

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Welcome to Asia Business Report. Australia's central bank is expected

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to leave interest rates on hold when it meets today, as the economy shows

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signs of returning to growth. A much anticipated economic audit released

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last week warned of a looming fiscal crisis. The government has hinted at

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a temporary income tax hike, a higher retirement age, and cuts to

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spending on social services. Earlier, I spoke to our Sydney

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reporter, Phil Mercer, asking him if the government's view of the economy

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is at odds with that of the central bank.

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Interest`rate 2.5%, which is historically low. As far as the

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central bank is concerned, the economy is in a reasonable state,

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considering the fading of the mining boom. Conservatives believe that

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radical spending cuts need to be addressed, that welfare rates are

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too high, and that they may need to be a deficit tax, for example, in

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next week's budget, to try to bring that back into surplus. There seems

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to be a clear gulf between what the reserve bank of Australia thinks,

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and that of the government. If there is a tough Budget next week, it may

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be the case that they have to try to counter some cuts. Could that be the

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case, if growth looks like it is in danger? Next week's Budget could

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look like that. If they pursue a very aggressive and austere budget,

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with cuts to spending on welfare, we could see the reserve bank having to

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wade in to reach is interest rates to pick up slack in the economy. Not

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only is next week's Budget crucial to the health of the Australian

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economy, it is shaping up to be extremely important to Tony Abbott.

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He did mention this temporary deficit levy, and all hell broke

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loose, with some of his own party members saying it would be political

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suicide to pursue that idea. Inflation figures for the

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Philippines are out today, and it seems the basics of life, like food

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and electricity, will be the biggest drivers of consumer prices. The

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Supreme Court recently blocked a bid by the country's largest energy

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supplier for a large hike, and they are trying to import more rice to

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ease the cost. Figures this morning are expected to see prices rising in

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the range of 4%. I was speaking to a Filipino expert from credit Suisse.

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I think inflation should calm down. We have seen a sequential momentum

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of CPI coming down, so I think that should be helpful in the second half

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of this year. When you have inflation running at about 4%, is

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that a risk to growth? The Philippines has been one of the

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fastest`growing regional economies. Yes, I think the issue for the

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Philippines is not so much, but too much of it. It is growing very fast,

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and the key is to make sure the growth is sustainable in the long

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run. I don't think inflation per se should impact growth. Once the

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stimulus programme has ended, will interest rates have to rise?

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Absolutely. What will that mean for growth? I think growth will

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continue, and if the government continues implement the structural

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reforms, if it continues its path of reform over the rest of the next

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three years. A Macau casino operator has come up

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with a winning hand, raking in $750 million in its first quarter. The

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territory has hit the jackpot to become the world's gambling capital.

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Casinos in Macau took in $45 billion last year, earning more in two

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months than Las Vegas does in a year.

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This is the newest casino resort from Sands China, in Macau. It is

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popular destination from tourists from mainland China. More of them

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are coming, and on average staying for longer. That is translating into

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profits for the country, which hosted more than 17 million visits

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in the first three months of the year. Tourists like to state their

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money on roulette or slot machines. It has become the jewel in the crown

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for Las Vegas Sands. In the first three months of the year, profits at

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Sands China jumped by almost 66%, compared to 2013. Ever since the

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Chinese government launched a crackdown on corruption last year,

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business from its expanding VIP customers has been under pressure.

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That has so far been offset by a rise in holidaymakers. So, casino

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operators are counting on them to try revenue in the coming years.

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`` Drive revenue. AIG has reported a drop in quarterly

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profit, due to high losses in its subsidiary businesses. The net

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income fell to $1.6 million. Last year, it was more than 2 billion

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dollars. Apple closed $6 billion up for the first time in several years.

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Last month, they posted its quarterly earnings, which beat

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expectations. Target says it is chief executive and chairman has

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resigned. His departure comes after a difficult year for the retailer,

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which was a victim of a data breach that shook customer confidence and

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hurt the company's profits. Up to 70 million customers had their payment

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card and personal information stolen from the company's database is in

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December. The chief information officer, Beth Jacob, who oversaw the

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computer systems, resigned in March. What began as one woman's desire to

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work for herself, has turned into a multi` million`dollar business. An

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American retailer got its start by selling clothing on eBay, and its

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owner is one of the people who will be speaking at a conference for tech

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start`up people. This is Tech Crunch. It is the place to be if you

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want advice from other success stories. It is events like these

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that give many tech companies their first big break. Sophia Amoroso has

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a different story. She is the founder of Nastigal, and is now one

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of tech's biggest retailers. I had no idea that when I chose the name

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Nasti Gal, would be saying it over seven years later, but it. You were

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one of the fastest`growing retailers in the US, to what you credit that

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success? We have always carried unique pieces. It started with

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vintage, really memorable vintage pieces, and that was my buying

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training. We went to trade shows, and now we are designing. We are

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designing for a girl with an appetite for something unique which

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cardfile at `` you can't find at the shopping mall. I wouldn't call us a

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tech company, but I wouldn't call us many e`commerce sites are now

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opening bricks and mortar stores. Is that something you are considering?

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And is that something that is necessary for these kinds of

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companies? We will be opening stores within the next year, which I'm

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excited about. We will start NLA. I think a brand is best experienced in

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all channels. While some people have to go off`line to continue going,

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perhaps their businesses more niche, it is a choice. I want to let our

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customers touch and feel our clothes. I want to see someone run

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out of stall happy a shopping bag, I have never had that experience. It

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is people talking on social media, which is great, but to meet a

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customer in the real world is an exciting thing. It is that

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experience, physically finding something perfect, that time for a

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quick check of the markets. The one market that is trading is up

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a little, having taken its lead from Wall Street. That is it for this

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edition of Asia Business Report. Thank you for watching.

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Our top stories: Nigeria's Boko Haram has admitted for the first

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time that they are responsible for abducting hundreds of schoolgirls.

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They have

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