07/05/2014 Asia Business Report


07/05/2014

Live from Singapore, the essential business news as it breaks and a look ahead to the news that will shape the business day.


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American company has been warned not to use the UK as a tax haven. Now on

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

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Could it be the biggest stock market listing in history? Ali Baba six

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billions from investors. Could Indonesian coffee become less

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available to foreigners? Welcome to Asia Business Report. I'm Rico

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Hizon. Starting with China's Alibaba. It has filed for a share

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sale in the US, which could make it as much as $15 billion. In initial

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stages of the filing, it hasn't specified how much stock will be

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sold or at what price. The online shopping giant operates a network of

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e`commerce services and brings in more money than us on and eBay

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combine. But how well known is Alibaba in the US? `` Amazon and

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eBay. To give you an idea of how much interest it is already

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building, Yahoo has a 40% stake in Alibaba and investors are buying

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shares in Yahoo just to have some of its shares in Alibaba. There is

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already quite a bit of interest, despite the fact that it might not

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be as well`known and amongst regular kind of investors. The one thing

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that might hold investors back in the US is the complex web of

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businesses. That might deter some investors. One merely `` $1 billion,

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US, is that realistic? It is probably going to be more than that.

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The $1 billion is really just a placeholder, a number they have to

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put. But most people believe they can raise anywhere from $15 billion

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`$20,000,000,000. If they are published that, it would be

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Facebook's IPO. They decided to file in the US rather than their home

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base. By? The United States allows for more control. `` why? That's

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what executives want. Alibaba proposed something different. Their

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shareholders, 20 members of the executive team, are able to vote on

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the people who are part of the board. That wasn't going to fly with

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regulators in Hong Kong. But it's something that was accepted here in

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big US, which is why they decided to list in New York. A marketplace

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which facilitates consumer to consumer online shopping now.

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It is the supreme shopping platform. There is almost nothing you can't

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buy on it. People call me Lunar Mum on internet. I sell maternity and

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infant products. It was hard at the beginning. Every day I wouldn't

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finish before midnight and I had to look after my baby as well. Now I

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have eight staff, divided into morning and evening ships. I even

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have customer service and a graphic designer. We chat to customers

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online before finalising the orders. In the afternoon, we start sorting

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the goods according to orders. We pack them into parcels for the

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delivery men. When I started, I made 10,000 yuan every month. Now the

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income is 40 times that. All young people now shop online. Even older

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people are joining the trend. The website has transformed my life. I

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believe its influence is only going to increase. The successful use. The

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following rate of growth of China's economy is a source of concern for

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many in the developing nations of Asia.

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But for countries in Africa, China's investment is still

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galloping ahead. By 2020, it expects trade with Africa to double to $400

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billion and Chinese foreign investment is expected to rise to

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100 Indian dollars. In Abuja, Nigeria, the World Economic Forum is

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taking place. We report from there. Nigeria is China's third`largest

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trading partner. Trade volume has increased as there is hardly any

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household in Nigeria without a product made China, especially at ``

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electronics. This is coming with huge business delegation. Several

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bilateral agreements will be signed. There are huge investment here, with

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interest spanning telecom, aviation and banking, as well as a huge

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presence in construction. This visit underscores the importance of

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Nigeria to China and the rising profile of Chinese business

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activities in Africa's largest economy. The World Economic Forum

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begins today. There is the risk of it being overshadowed by security

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concerns. China has started controlling

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imports of baby milk formula to try to rebuild its dairy industry.

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Demand for imports soared after a scandal in 2008. But authorities are

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trying to help local producers claw back market share from suppliers in

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New Zealand, Australia and Europe by stopping imports from producers who

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are not registered with them. New Zealand is a major exporter of milk

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formula to China. Earlier, I spoke to the head of the trade body in

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Auckland and asks how this will impact their industry. Each year it

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is about $200 million, New Zealand dollars, of milk formula. This is a

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rising market for New Zealand because of our free trade agreement

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that we signed back in 2008. It is part of a market that is growing and

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part of our market where Ali Young, small, entrepreneurial companies

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have taken a good share of the market and that market is now at

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risk. `` our young. Suppliers now have to be approved by mainland

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authorities. Apparently only 30 suppliers, six other countries, were

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approved. How could this impact, in terms of production and revenues,

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the New Zealand baby formula market? What we are going to see is the

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initial audit covered 13 companies and now we have about eight of those

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who have passed the globe mark. What we will see is some pressure put on

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the brand holders. For some reason the Chinese are looking at brands

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and looking to have Rands reduced, whereas in the New Zealand market I

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am saying that what they should be doing is looking at the quality of

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products supplied. `` brands. That will give accountability to

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consumers in the China market. There is no need to exclude part of our

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supply chain. If it is breakfast where you are

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watching, you might have had your first couple of coffee or at least

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he might be thinking about it. But do you know where it comes from?

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Indonesia is the world's fourth largest coffee producer and in the

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past is exported almost all of it. Now, Indonesians are demanding

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better coffee and that is expected to put a shotgun exports.

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Afternoon coffee. It is fast becoming Indonesia's pastime. This

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couple opened this shop last year. She admits business is slow but she

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is confident that the future is bright. Older generations like my

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father or uncle, the way they drink coffee, they just drink the popular

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Indonesian instant coffee or they just put water over the ground

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coffee and they drink the sediment. Now, the young generation drinks

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espresso, Pacino. This is where all of that coffee comes from. ``

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cappuccino. These are unprocessed coffee beans. In the past,

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Indonesian farmers would pick the beans indiscriminately. It is faster

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but the result is a lower quality coffee. Now, it pays to pick only

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the best beans. This man has been a coffee farmer for more than 20

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years. He first learned about the plant on his grandmother's farm.

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But, until recently, nobody taught him how to produce high`quality

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coffee. Now he is small `` he is all smiles while picking the best beans.

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TRANSLATION: I used to sell one kilogram of regular quality coffee

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beans. For the superior quality, people are willing to pay almost

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three times the price. The best Indonesian copy used to be mainly

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for exports. This Di Resta sells special coffee, the highest in the

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trade, locally and overseas. `` this exporter. The majority will be

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local. Locals will consume it. Mid to upper class. We do not expect

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foreigners, because our biggest market is our growing need

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upper`class. `` mid. But the bulk of Indonesian copy still has to go

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overseas for some time as it had enough demand in the country. But

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farmers are increasingly setting the price for the popular commodity.

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Thank you for investing your time with us. The sport is up next.

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The top stories this hour. Eight more schoolgirls have been abducted

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in Nigeria. The US is sending a team

:10:52.:10:52.

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