24/06/2014 Asia Business Report

as extraordinary people. Time for the latest business news.

Japanese prime ministers Shinzo Abe sets out to hundred new measures

aimed at boosting growth. Shows of Japan's the best car makers are

slumping after a potentially explosive air bags sparked a major

recall. Welcome to Asia Business Report. How

do you beat decades of deflation and a stagnant growth? Shinzo Abe has

been trying to do just that through a strategy of fiscal stimulus,

monetary easing and structural reforms. He is going to unveil

several new measures later today including cutting the corporate tax

rate and promoting the legalisation of the casino industry. To find out

if it will hit its target, we are joined now by a Japanese economist.

What are you expecting exactly from the Prime Minister? We already had

to be announced. `` of the announcement. We have seen a draft

of the measures in agriculture, encouraging women to walk. `` work.

You say they are important measures, but there are over 200 measures. The

include proposed bans hold of regulations. Will it work? It

depends on the details. We have not seen the final draft yet. What we

have seen so far, it seems rather piecemeal. We still need to see the

final draft. I expect it will be similar to what we saw last year.

Last year was 110 page document with thousands of measures. But nothing

much concrete came out of it. If you take a look at the reforms that the

Prime Minister has put in place so far, you have a huge fiscal

stimulus. Have his previous measures had some impact? We have seen some

impact. The number of women has increased in the workforce. The

Japanese economy has grown over the past year. There was a hint of a

consumption tax hike. The reforms have not fulfilled their potential,

but it takes time. Electricity reform will take several years to

legislate. Even longer to fulfil its effects. It will take time before we

see the results. We will wait and see if Japan manages to lick its

self out of these decades of poor growth. `` lift. Continuing with

Japan, sherries of the three biggest car makers are falling after they

announced a major recall over faulty airbags.

Japanese companies are not the only ones affected.

Honda has been hardest hit by the problem and has been forced to

recall an additional 2 million vehicles. This and has recalled an

additional 750,000 while Master has recalled 150,000. The fault is with

the aerobatics. The park was supplied by another Japanese firm.

Other carmakers have also issued recall is over the same part.

Globally, Japan's leading manufacturers have recalled 7

million cars. There have not been any reports of accidents or injuries

due to the issue. But apparently there has been one report of a seat

cover burn. Japan's companies are not the only wants grappling with

recalls. General Motors has recalled several million cars this year, more

than it has sold. It is due to faulty ignition switches. They have

also issued recall is over seatbelts, transmissions and air

bags. Hardly a I spoke to a Tokyo `based

automated journalist. I asked if the recall would wrote applications for

quality. These are problems that are encouraged that are no longer being

made. The manufacturers are confident these problems will not be

lingering. The impact on sales might be limited. The impact on earnings

is still to be determined. The biggest one hit will be the

supplier. In the recall last year they took a $300 million charge for

this. You can expect similar charges this time around. We know these

vehicles takes the total number of car is recalled to nearly 7 million

globally. That is a lot of cars. Is this a sign of manufacturing

standards going down, or is there a tougher scrutiny? The numbers are

eye`popping. Especially when you look at General Motors. It might be

alarming to consumers. But the quality of cars being produced today

has never been better. It has to do with the sophistication of some of

the small parts in the cars. There is a higher level of scrutiny that

goes into that. People are not willing to tolerate even small

glitches that might have been locked over decades ago.

In other business news, the South Korean government is looking to sell

its stake in one of the country's biggest financial firms for a fourth

time. It has a stake of $4.5 billion. But they have had trouble

privatising the lender. South Africa's longest ever work stoppage

has officially ended after unions reached a deal with platinum mining

companies. They have been on strike for the past five months. Severely

impacting South Africa's economy and mining companies. Over in the art

world, a famous painting by Monet has sold for $450 million.

The painting was sold to an anonymous bidder at an auction in

London. Since the end of the civil war, the physical face of Sri

Lanka's commercial capital Colombo has been radically changed.

Long`standing lower`income areas are being demolished to make way for

postage developments. One area in the middle of the city is known as

slave island. It is like a small Sri Lanka in the

beating heart of the city. Was the and Buddhist, Christian and Hindu

jostle side by side. Life is lived on the streets or in the alleyways.

Most people here do not have much money. But they value their way of

life. This will `` woman watches the world go by. She was born in the

same house which deal shelters her family. She is unhappy as it has

been earmarked for demolition. I do not want to go, I want to stay, she

says. Many nearby houses have already been demolished. After

decades of war, the government says it wants a Colombo that can rival

Singapore and wants to liberate these lands for commercial purposes.

As a result, entire streets of traditional houses are being

flattened. Resulting in this. Luxury flats and hotels are to come up. In

slave island, the developers include Indian ones. Here, were modest

flats. He says it is nice to all the neighbours have moved here, but they

got no payment for their old house. Some human rights campaigners say

the people of slave island are unwillingly big. At `` being forced

out. People seem to fit protesting. The authorities say the move from

houses to flats is a natural one. People will get used to that. It

happened in Vietnam and Singapore. Many other countries. It is a normal

sort of behaviour. The developer has promised to build the flats for the

locals where the old houses were, next to the new luxury blocks. Its

architectural heritage and unique atmosphere are passing into history.

That is it for this edition of Asia Business Report. You can follow us

on Twitter. Here are the headlines: An Egyptian

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sparking international outrage. As Michael Schumacher continues his

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and offered for sale. There's about to be a shake`up at

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