02/07/2014 Asia Business Report

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

It is Asia Business Report. Indonesia 's finance minister tells

the BBC the economy needs to attract more foreign investment. Carving a

future, Japanese craftsmen find new ways to keep the family business

alive. Hello and welcome to Asia Business

Report. Some investors have become wary of Indonesia after it was

dubbed one of the world's fragile five economies. It is also one of

the key issues for Indonesians who will vote for the next president in

a week. That is why generating growth and creating jobs is a top

priority for the government. As part of the coverage of the upcoming

elections, our correspondent explains why the country is at a

crossroads. Indonesia has become a middle income

country in the last decade. It is a notable achievement. Recently,

growth has slowed. Will they continue to grow in a virtuous

circle? Could it fall into a vicious cycle? Resource rich Indonesia was

tipped into a virtuous circle when the global commodity sought prices

skyrocket. It added in investment funds boosting growth. Higher

economic growth meant there was money for investment. Indonesia was

in a circle of growth and investment. Will the end of the

commodity burden being Indonesia fall is into a vicious circle? Low

investment could lead to slower growth and less income. If the

country can attract investment into new areas like consumer goods to

serve the vast population, that could launch Indonesia into a new

cycle of growth and prosperity. Linda also caught up with Indonesia

's finance minister and asked whether poor infrastructure is a

challenge in attracting investors. This country can't go by 7% without

foreign investment. If you want to grow, you need investment over GDP

of 37%. It is only 32 at the moment. The only way to ensure the country

grows is by opening foreign capital portfolio. We need to grow by 7%,

white? It is the only way to provide jobs. What I have heard from

businesses is the frustration around the traffic jams in infrastructure

and one is over corruption and leakages of the money being spent.

Why hasn't it been sorted? It is important to look at the current

situation and the previous one. Let me ask you a question. Do you think

the corruption under Suharto was relatively low masse may be the

answer is, no. Why did the economy grow by 7.6%? Why have we been able

to build infrastructure? We couldn't build it after the 1998 crisis. It

isn't about corruption. It is about certainty. You deal with a single

family in the past. Everything will be settled from the top until the

bottom. Since we have had this democratic setting, there is the

fragmentation of power. You must talk to Parliament, local

government, central government, maybe the transaction is

increasing. The problem is uncertainty. This is the thing that

I have learned, there is something worse than organise corruption, and

it is disorganised corruption. The resource room is over. `` resource

boom. 65% of exports will collapse if this trend continues. The

Indonesian finance minister. JP Morgan 's chairman and CEO has been

diagnosed with throat cancer. He says the prognosis is excellent and

he will continue to be involved in the investment bank during his

treatment. He will limit his travel during the chemotherapy. Google has

bought a free online music streaming service called Songza. It recommends

playlists based on moods and has 5 million users. Financial terms were

not disclosed. Reports value the deal at $15 million. HSBC pays $10

million to settle US charges it defrauded taxpayers over housing

foreclosures. The lender is accused of inflating fees and overcharging

the US government when it protest resident foreclosures in 2009 and

2010. The US government said this led to millions of dollars of

losses. Australia logs a $2 billion trade deficit in May and the

country's historically high dollar could have a significant impact on

that. It is now worth more than 94 US cents, up 87 cents in January and

some investors bet it might regain parity or equal value with the US

dollar this year. Earlier, I asked an analyst whether he thought the

Australian dollar would strengthen further. It is unlikely that

interest rates will rise in the short term. There is dragged on the

domestic economy. The reserve bank made the case the economy is weaker

than expected. The most important factor is the US dollar and a

strengthening US dollar is something we believe in. While we might see

short`term strength in our dollar, we think the US dollar will come

back and we see the Australian dollar in the medium`term somewhere

in the mid` 80s as opposed to parity, which it might touch the

short term. Businesses have throughout history

been handed down through generations and in some cases they stay in the

same family for hundreds of years. How do they adapt and survive?

Rupert Wingfield`Hayes met the last in a line of craftsmen in Japan and

has diversify to his family business although not entirely on purpose.

Have a guess what this craftsmen is making. Whatever you guessed, I am

pretty sure it is wrong. These strips of wood and glue will

eventually be part of a bicycle. That's right. I would bicycle. `` a

wooden bicycle. This man's family have been mastered boatbuilders for

over 200 years. In a nearby dock, he has the first one he ever made. He

began building Pretty Angel when he was 13, it took him five years. How

did he get from here to making bicycles? I can make a bicycle the

same way. Some European people are asking for it to not be exactly

round. Seven years ago, he built this, a racing bike made entirely of

mahogany. Here we go. It is a rather strange feeling, to be riding a

$20,000 mahogany bicycle. You would not think it is wood, but it is

astonishingly light, 7.5 kilograms, the same as a carbon bike. He made

his first bike to show off his woodworking skills. Then he took it

to a European bike show. Everybody was surprised. Some people tried to

ride. Very fast and interesting bike! I had three orders in one day.

I was very surprised. Client says, the price is high, but quality is

also very high and it looks very nice and I have never seen such a

high performance would bike. He is a craftsmen who takes immense pride in

what he banks. He will make three bikes this year `` makes. If you

order one now, you will have to wait until 2018 to get it. His daughters

don't want to do this. When he retires, all of his knowledge and

skills could be lost for ever. Before we go, a story for those who

like to invest in a good night sleep. Tracy England has sold her

own made bad, replete with empty bottles, condom than cigarette

butts, for more than $4 million at a London auction. My bet does not look

like that and it does not copper asthma `` does not cost that much

either. Thank you for watching Asia Business Report. I am Mike Embley.

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