09/05/2014 Asia Business Report

will be in the Britain. ``in Britain. The biggest cutbacks will

be in the investment banking division. Shares in the bank rose

after the announcement. Now on BBC News all the latest

business news live from Singapore. Investor confidence stakes are hit

with Vietnam, tough times for aviation. What do regional airlines

need to do to maintain profitability? Investor confidence

gets hit in Vietnam due to heightened tensions with China.

Thanks for watching Asia Business Report, I'm Rico Hizon. Stocks in

Vietnam have fallen by 6% on Thursday, following a clash between

two ships, it has turned the country 's benchmark index into the world 's

worst performer. Now, we are speaking with the publisher of a

report. He is well`known for it his investments in emerging markets.

Mark, thank you for joining us on the programme. You concerned about

this conflict between the Chinese and the bigamy is? `` are you

concerned? ``Vietnamese. The Western world seems to believe that we live

in the 19th century, when Western powers could barely China and other

Asian countries. Then, about two years ago, Hillary Clinton declared

the pivot to Asia `` bully. That of course, Chinese decoration, China is

reacting in the way that Russia react to Ukraine. Should the

countries that are meeting now work as one and stand up to the Chinese?

Basically, in my view, since you live in Asia, in Asia, we can

negotiate and compromise. The increased American military presence

in Asia is a sign of aggression for the Chinese, because Asia basically

has become China centric, all of the countries in Asia depend on trade

more. On trading more with China than the US. So other Southeast

nations have a tricky balance. It is a major trading partner of the

Southeast Asian economies. But you also have the Philippines involved,

could this have an impact on Southeast Asian economies? Yes, I

have been writing about this for a long time, instead of being glued on

what has been said, it will be more productive for investors to consider

the geopolitical risks. In Cambodia, and in Thailand, they are

potentially great economies, but the geopolitical issues are going to

have an impact on the asset market. This geopolitical conflict, in the

South China Sea, and the claimants to these territories, can they

resolve their issues? So that we can move forward and all of the

countries here in the region can grow? For China, the access to

resources, like oil from the Middle East, that is vital. They need those

shipping lanes to be guaranteed. They cannot rely on the US to

guarantee shipping lanes, they had to do it themselves. Over time,

tensions will increase. Thank you for your insights. In other business

news making headlines, a $35 billion merger between two advertising

companies has been called off. According to industry sources, the

companies could not agree on terms, including who would be the chief

financial officer. The merger would have seen the combined unit overtake

WPP as the world 's largest advertising company. It included a

joint structure for a new company called Publicis Omnicom group. Apple

is looking to buy a smaller company, according to various media outlets,

if the deal pushes through, it will be the largest acquisition ever.

They also run a streaming music service and it is a collaboration

between Jimmy Irvine and Doctor Dre. Malaysia 's flight carrier is

expected to sink deeper, into the red, when reports are due at the end

of the month. The USA could have to pay `` the airline could have to pay

millions of dollars in compensation to the families of those of the

missing flight MH 317. The protests are a major factor, in the first

quarter, traffic from China and Japan and Korea have dropped by over

25%. I would not say it is bad management exactly. Many of the

national carriers in Indonesia, and the Philippines, they are also

struggling in this very competitive environment at the moment. What

about Malaysia Airlines? They have gone through so much over the past

year. Is it being run by bad management? Malaysia Airlines is

more a tale of two halves. Malaysia Airlines has some of the highest

traffic growth, at 29%. They have benefited with their own revenue

growth. `` Malaysia has some of the highest traffic growth. There has

been tight price competition from carriers in Malaysia. They have

struggled to make a profit. It could be taken over? Malaysia Airlines is

the national carrier, and they employ thousands of people. There is

an issue `` if there is a private issue, it will not be taken over.

With the profits, compared to Southeast Asian peers, what keeps it

competitive and profitable? It is a brand in a major transit location,

for passengers going to the west and east and Australia. It is famous for

being one of the best run carriers in the world. There is an unusual

multipronged approach to their building model. It has cargo, long

haul, premium services, low costs in the regional sense and in the long

haul sense. It tries to cover all bases. Monday covers the final day

of voting in India's general election, there is a business

sentiment in a country that has seen a slowdown in growth over the years.

Our correspondent met with the central bank governor, and asked if

the business of armoured could become stable if a new

administration accepts early economic policies. People talk about

it, a lock like this. What are the differences between one government

and another? If you take another perspective, and compare the

governments, there has never been a very sharp shift in policies or in

policy ideology. I do not believe that it matters with the government

coming into office, that would mean a big shift in policy. Certainly not

in the short term. There is anticipation about a new government

coming into office in Delhi. And kickstarting the economy. We have to

remember, that India, as a country, there is only so much that Delhi can

do. A lot has to be done at a national level, including the state

level. No matter who becomes the Prime Minister, it is not only doing

the right things, in Delhi, it has to do all of the right things done

below and above the state level. Let's have a quick look at the

markets. We are seeing mixed reactions in Asian stocks. This is

after Wall Street finished in negative territory overnight after

gaining headway on Thursday after better`than`expected results.

Marginal gains for Hong Kong, Japan, and South Korea, they are all

in positive territory at this time. There are losses in the energy and

utilities sectors. Have a good weekend, thank you for your time,

goodbye for now. The top stories this