:00:12. > :00:22.Is Latin America the new battleground for Japan's rivalry
:00:23. > :00:31.with China? Prime Minister Abe is there to boost ties. And strong
:00:32. > :00:44.competition facing Starbucks, as it opens shop in Hanoi. Welcome to the
:00:45. > :00:47.programme. Japan's Prime Minister Shinzo Abe has kicked off a 5`nation
:00:48. > :00:50.tour of Latin America by signing a series of oil and gas deals with
:00:51. > :00:53.Mexico. Japan has been focused on energy since the Fukushima disaster,
:00:54. > :01:01.which shut down the country's nuclear reactors. It comes hot on
:01:02. > :01:04.the heels of a trip to the region by China's Premier Xi Jinping. Both
:01:05. > :01:10.China and Japan are keen to tap into Latin America's natural resources.
:01:11. > :01:13.One of the most important issues around Asia, including in Japan and
:01:14. > :01:17.China, is energy and resources. This is where Shinzo Abe is following
:01:18. > :01:23.China on many accounts. Already into Africa and now into South America.
:01:24. > :01:26.Very important deals have to be signed on oil and gas, which is so
:01:27. > :01:30.important in Japan after nuclear power was switched off. Is it a
:01:31. > :01:37.competition between the two? Is Japan looking for resources as well
:01:38. > :01:40.as other things? There might be some competition in Asia and even in
:01:41. > :01:44.Africa, but not so much in South America. Everyone is after resources
:01:45. > :01:52.but for Japan, this is a very important market. When there is a
:01:53. > :01:55.deal on infrastructure or energy, Japan is much more about selling its
:01:56. > :02:00.technology, while China is just trying to connect its market to
:02:01. > :02:02.major projects. We have seen this deal with Mexico. Japan has a
:02:03. > :02:10.free`trade agreement with Mexico. Now they have signed deals in oil
:02:11. > :02:13.and gas. Is this the first of many contracts to be signed over the
:02:14. > :02:17.course of this visit by Shinzo Abe to Latin America?
:02:18. > :02:21.Yes. Mexico is very important because it is the market that
:02:22. > :02:31.connects Japan to the US. It is the energy market. In Brazil, it will be
:02:32. > :02:40.security relations but also energy. Japans wants to sell its technology
:02:41. > :02:43.and major infrastructure projects. And Chile is very important because
:02:44. > :02:48.already half of Japan's copper comes out of Chile, which is so important
:02:49. > :02:51.for the electronics industry. There will be more contracts and major
:02:52. > :02:53.projects. Thank you. China's industrial profits continue to
:02:54. > :02:56.expand at a faster pace than expected, due to strong growth in
:02:57. > :03:02.June, when profits rose 18% compared to one year before. The US company
:03:03. > :03:05.that owns the meat supplier at the centre of China's latest food scare
:03:06. > :03:10.is withdrawing all products made by its subsidiary, Husi Foods. It is
:03:11. > :03:11.sending its own representative to Shanghai to investigate claims that
:03:12. > :03:36.Husi Foods sold out of date meat. That includes McDonald's and KFC.
:03:37. > :03:39.India's consumption of soft drinks is well below that of China, the US
:03:40. > :03:41.and Europe, but it is growing rapidly. In the budget is a plan to
:03:42. > :03:59.add a 5% tax to sugary fizzy drinks. The debate over soft drinks and
:04:00. > :04:01.their potential harm in large quantities has been bubbling over
:04:02. > :04:02.around the world. India's government has now weighed in, unexpectedly
:04:03. > :04:08.raising taxes on them. I propose to levy an additional duty
:04:09. > :04:24.of excise of 5% on aerated waters containing added sugar.
:04:25. > :04:29.The extra money will not do much to balance the books but it is
:04:30. > :04:35.certainly an attempt to balance the scales. In the past few years, more
:04:36. > :04:37.and more Indians have been getting health`conscious and consulting
:04:38. > :04:41.experts for guidance on what they should eat and drink. Steering clear
:04:42. > :04:44.of too many fizzy drinks is one piece of basic advice. But there is
:04:45. > :04:53.scepticism about whether this so`called healthy tax will
:04:54. > :04:56.discourage the large majority. They want something to make an
:04:57. > :04:58.impact and to dissuade the public from using fizzy drinks. So, why
:04:59. > :05:04.don't they prohibit advertising such products? Similarly how we have a
:05:05. > :05:12.ban on tobacco and smoking and cigarettes and alcohol?
:05:13. > :05:16.India is not the first country to bring in extra taxation on these
:05:17. > :05:18.products. In fact, it is a list that has been growing and which includes
:05:19. > :05:23.nations like France, Germany and Mexico. Compared to other countries
:05:24. > :05:40.around the world, India is a relatively small consumer of fizzy
:05:41. > :05:44.drinks. Roger Tan says these health taxes have been effective in other
:05:45. > :05:50.parts of the region. It has been shown that there is a 10% rise in
:05:51. > :06:01.prices can create a 4% drop in consumption. These tend to be more
:06:02. > :06:04.effective than the other ways of trying to prevent somebody will
:06:05. > :06:06.discourage somebody on drinking or consuming something that would cause
:06:07. > :06:09.future health problems. Those figures, are they specifically for
:06:10. > :06:23.alcohol or more broadly? We have seen taxation on fizzy drinks in
:06:24. > :06:27.other jurisdictions. From what I have seen for alcohol, there is some
:06:28. > :06:30.for tobacco as well, it does show that in general, price changes tend
:06:31. > :06:33.to be more effective than things like education, advertisements and
:06:34. > :06:36.so on. What does this mean for the business bottom line? If it does cut
:06:37. > :06:39.consumption, does it move that consumption to other products?
:06:40. > :06:41.Businesses will find a fall in consumption affecting their
:06:42. > :06:44.business, so they will start producing more healthy things like
:06:45. > :06:47.fruit juices. With alcohol consumption, the interesting thing
:06:48. > :07:02.is that with heavy drinkers, the monetary change does not change
:07:03. > :07:06.consumer behaviour. It is the same with heavy users of tobacco. Do you
:07:07. > :07:09.see these tax changes is becoming more common in Asia as governments
:07:10. > :07:12.become more aware of their health budgets? What we have just seen,
:07:13. > :07:16.this monetary change does affect consumption. If that reduction in
:07:17. > :07:19.health issues in the future offsets the dropping consumption, that is
:07:20. > :07:24.something that they want to do but unfortunately, how much savings will
:07:25. > :07:32.you actually get in the future? Is too far the future to see and it is
:07:33. > :07:36.too cause. `` too indirect. So far, it is an excuse for them to raise
:07:37. > :07:43.taxes more than really to reduce health issues for the future.
:07:44. > :07:47.Staying on beverages, it was always going to be a gamble moving into a
:07:48. > :07:59.country with an established coffee culture. Starbucks first opened in
:08:00. > :08:02.Vietnam last year. Coffee is huge in Vietnam. The south`east Asian nation
:08:03. > :08:06.is the world's second largest exporter of coffee. There are more
:08:07. > :08:08.coffee shops crammed into Hanoi than probably anywhere on earth, so
:08:09. > :08:12.opening a cafe in Vietnam's capital could be a bit of a gamble. But this
:08:13. > :08:14.month, Starbucks is making an aggressive push, opening three
:08:15. > :08:22.branches in this bustling city, possibly one of its most challenging
:08:23. > :08:25.markets yet. It is unique and special in that
:08:26. > :08:28.there is a long and deep coffee history and heritage in Hanoi and
:08:29. > :08:42.many things in Hanoi happen over coffee.
:08:43. > :08:44.The US coffee chain already has 11 outlets in two other Vietnamese
:08:45. > :08:47.cities, but France's coffee legacy is most visible in the capital. Most
:08:48. > :08:58.city streets overflow with coffee shops that sell one cup for as
:08:59. > :09:02.little as 50 cents. Black coffee in Starbucks costs about $2.60, about
:09:03. > :09:05.half the average daily wage. TRANSLATION: I'm not concerned about
:09:06. > :09:08.the competition because we have a number of regular customers. Some
:09:09. > :09:15.have been drinking coffee here for the last 61 years. Hanoi's first
:09:16. > :09:19.Starbucks drew the crowd on opening day, but the question is if it can
:09:20. > :09:22.keep up the momentum, as many Vietnamese people feel financially
:09:23. > :09:25.squeezed. The country is mired in debt, hit by bankruptcies and last
:09:26. > :09:43.year suffered its slowest growth in four years. Not everybody has the
:09:44. > :09:45.money to spare. TRANSLATION: Having more types of
:09:46. > :09:48.coffee, like with Starbucks, it certainly makes things seem more
:09:49. > :09:50.interesting. But for me, I prefer Vietnamese traditional coffee. The
:09:51. > :09:54.streetside coffee is more down`to`earth and it suits my
:09:55. > :09:57.wallet. Starbucks hopes to brew up profits in Hanoi, but the coffee
:09:58. > :10:09.giant might just find that it is not everybody's cup of tea. Now, a quick
:10:10. > :10:20.check of the markets. Wall Street closed lower on Friday, but regional
:10:21. > :10:34.markets are up. Australia was up earlier in the UK, but is down one
:10:35. > :10:37.point. `` earlier in the day. That is it for this edition of Asia
:10:38. > :10:41.Business Report. We are on Twitter, don't forget to follow us there.
:10:42. > :10:50.Thank you for watching. This is BBC News. The top stories this hour:
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