:00:00. > :00:00.despite a report about child abuse. He managed children's services
:00:00. > :00:17.between 2005 and 2010 `` accurately. Time for the business news with Rico
:00:18. > :00:23.Hizon live from Singapore. Qantas makes its biggest loss and
:00:24. > :00:26.the airline top boss faces pressure to quit. A big day for Malaysia
:00:27. > :00:35.Airlines as they prepare to NL is their earnings results. Hello and
:00:36. > :00:40.welcome to Asia Business Report on BBC World News, I am Rico Hizon.
:00:41. > :00:44.Record losses for Australia's iconic brand, the flying kangaroo,
:00:45. > :00:49.otherwise known as the national carrier, Qantas. It has reported its
:00:50. > :00:53.worst ever annual earnings results. With the latest, let's cross over to
:00:54. > :01:01.Phil Mercer in Sydney and feel, how bad were the numbers `` Phil.
:01:02. > :01:05.Full`year losses of 2.6 5 billion US dollars. The biggest loss in
:01:06. > :01:09.Qantas' history and the chief executive of the company, Alan
:01:10. > :01:15.Joyce, said the results were confronting but he is trying to
:01:16. > :01:21.reassure investors the worst was over. These results are double what
:01:22. > :01:26.analysts expected and clearly, for Australia's national carrier, these
:01:27. > :01:31.remain tough times. One of the world's oldest and most
:01:32. > :01:35.recognisable airlines is in deep trouble. Soaring fuel costings and
:01:36. > :01:40.fierce competition have resulted in mass redundancies and financial
:01:41. > :01:45.losses. Despite it declined, Qantas remains a popular institution at
:01:46. > :01:51.home. Australians want Qantas to survive but they aren't afraid to
:01:52. > :01:56.fly with someone else. It is good we have a good Australian airline.
:01:57. > :02:01.Long. Qantas is allied with Emirates and want the Australian government
:02:02. > :02:06.to relax regulations that limit foreign ownership of the airline to
:02:07. > :02:13.49%. Travellers continue to desert and Australia's national carrier. If
:02:14. > :02:17.you look at the number of passengers using Qantas, they are diminishing.
:02:18. > :02:24.Where does this shrinking stock? With Qantas being taken over or by
:02:25. > :02:29.foreign capital coming in `` stop. The aviation market has become
:02:30. > :02:33.saturated. Qantas is facing relentless competition on both its
:02:34. > :02:36.international and domestic routes. Many passengers feel and overseas
:02:37. > :02:42.takeover is inevitable. Foreign ownership, let's look at mining,
:02:43. > :02:45.owned by the Chinese, everything else is owned overseas. We don't
:02:46. > :02:49.have the population`based to keep it going. If it keeps it afloat, keeps
:02:50. > :02:55.jobs in Australia, it makes no difference at. Qantas' plans for a
:02:56. > :02:58.profitable future will come under scrutiny. There are those that
:02:59. > :03:00.believe that for the flying kangaroo believe that for the flying kangaroo
:03:01. > :03:05.this could be a life or death struggle. At stake are not only
:03:06. > :03:11.thousands of jobs at Australia's aviation reputation. Trade unions
:03:12. > :03:15.have threatened strike action over job cuts including in the
:03:16. > :03:20.maintenance division. Pilots say that decisive action is needed to
:03:21. > :03:23.build stronger line. It needs to go through a little pain initially like
:03:24. > :03:30.we are going through now with redundancies and losses but it needs
:03:31. > :03:33.to justify it to the bank and shareholders that injections of
:03:34. > :03:37.capital can re`equip the fleet. It needs to buy a more modern, fuel
:03:38. > :03:43.efficient aircraft. Qantas has flown for the best part of a century but
:03:44. > :03:46.is facing unprecedented challenges. For the famous flying kangaroo, the
:03:47. > :03:52.months ahead promise to be turbulent.
:03:53. > :03:57.Many problems for Qantas. What is next for the carrier? Qantas plane
:03:58. > :04:03.'s weak demand and a subdued business and consumer confidence.
:04:04. > :04:08.For this shattering loss as it has been described along with high fuel
:04:09. > :04:13.costings. Also, the cost of this three`year restructuring which
:04:14. > :04:17.involves thousands of redundancies. The CEO, Alan Joyce, believes the
:04:18. > :04:21.worst is over and that the company could return to profit within the
:04:22. > :04:25.next year. Analysts think the result is so bad that the entire board
:04:26. > :04:32.should go and we have just looked at the numbers in the last hour or so
:04:33. > :04:37.and investors don't seem spoked. Qantas shares are up 6% in early
:04:38. > :04:47.trading `` spooked. They must see the silver lining. For more analysis
:04:48. > :04:51.on Qantas, visit our website. Qantas isn't the only regional
:04:52. > :04:55.carrier grappling with tough times, Malaysia Airlines is undergoing a
:04:56. > :04:59.major restructure with its majority owner, the state investment fund,
:05:00. > :05:03.taking the company private and planning to implement reforms
:05:04. > :05:07.including job cuts. It was already in financial trouble before the
:05:08. > :05:13.tragedies of flight MH17, shot down in Ukraine, and MH370, which
:05:14. > :05:17.disappeared in March. Earnings for the second quarter of two out later
:05:18. > :05:24.today and I asked earlier our correspondent from main bank how he
:05:25. > :05:43.saw the results. Very bad, perhaps the worst it has faced in its in ``
:05:44. > :05:49.in Thai history `` Maybank. It is exacerbated by the MH17 issue. It
:05:50. > :06:02.will be bad. How bad will the numbers ? 600 million ringgit lost
:06:03. > :06:08.but it could range from 600 `800 million, it is a tough call `` loss.
:06:09. > :06:11.Indeed it is tough and a lot of money to lose. Right now, what is
:06:12. > :06:17.reported in the media is cuts of about 6000 jobs. How painful will be
:06:18. > :06:26.restructure the in the months ahead? Very painful. It will be the
:06:27. > :06:31.deepest restructure that has ever occurred in the airline. Let's be
:06:32. > :06:35.clear, the objective is to save the airline. At least we will have a
:06:36. > :06:39.national carrier. God forbid, if nothing is done, Malaysia Airlines
:06:40. > :06:48.will earn its place in the history books. It is really that dire. To
:06:49. > :06:55.lose 5000 or 6000 employees, it is a necessary step. Necessary, though
:06:56. > :07:00.what will it look like after the restructure? What do you suggest
:07:01. > :07:08.they undergo? A new name for the carrier? What I suggest is for
:07:09. > :07:12.Malaysia Airlines to be a domestic airline with a touch of some
:07:13. > :07:21.regional routes. All the international flights don't have a
:07:22. > :07:24.business case to survive. Malaysia's transport minister holds
:07:25. > :07:29.a press conference when Australia's deputy Prime Minister shortly to
:07:30. > :07:38.announce how they will fund the search for Malaysia's MH 378
:07:39. > :07:42.Australia's deputy. Ali Baba profits have tripled ahead of the US
:07:43. > :07:46.listing. Ali Barber said second`quarter profit came in at $2
:07:47. > :07:53.billion. They will debut on the New York Stock Exchange later this year
:07:54. > :07:56.and is expected to be the biggest offerings in Facebook in 2012 ``
:07:57. > :08:01.Alibaba. Some good news now and there are signs that the Philippine
:08:02. > :08:06.economy is on track for a rebound. We find out the details in about one
:08:07. > :08:11.hour. The government will unveil growth figures for the second
:08:12. > :08:15.quarter. 2% expansion in the three months to June is expected, the
:08:16. > :08:20.fastest pace in over one year. A pickup in public spending is
:08:21. > :08:25.expected to help. A spokesman from ANZ bank said government spending
:08:26. > :08:29.has been inconsistent. `` spokeswoman. We have been worried
:08:30. > :08:31.about numbers because of understanding in the first five
:08:32. > :08:38.months of the year. For the first time in more than ten years, public
:08:39. > :08:41.spending or the public deficit was actually a surplus in the first five
:08:42. > :08:50.months of the year. It was only in June where it, in the government,
:08:51. > :08:56.spending sped up. Nevertheless, spending won't make up a deficit if
:08:57. > :08:59.they remain this spending. On the ground when I go to the Philippines
:09:00. > :09:05.and I talk to the people on the streets, they tell me that they
:09:06. > :09:09.still don't feel the gains that the Administration has forged over the
:09:10. > :09:15.past four years. Is it really the rich getting richer and the poor
:09:16. > :09:19.getting poorer? Not necessarily. We have seen a resurgence in
:09:20. > :09:21.manufacturing and industrial manufacturing has accelerated also
:09:22. > :09:27.meaning that export numbers should be quite good later on.
:09:28. > :09:32.Unfortunately, in the past six months, inflation has been high. It
:09:33. > :09:39.has been driven by high fuel prices, rice prices have increased
:09:40. > :09:44.more than 10%, simply because of anti` smuggling efforts. Further,
:09:45. > :09:47.you also have a truck ban in Manila which is increasing imports. This
:09:48. > :09:53.should feed into second`round effects later. Will be likely see
:09:54. > :10:00.the central bank continue to tighten interest rates which they did a few
:10:01. > :10:04.weeks ago? Definitely. Liquidity is flush on the ground. The central
:10:05. > :10:09.bank needs to tighten. Our call is for further tightening in the STA.
:10:10. > :10:15.Unfortunately, the only tighten the policy rate which isn't very
:10:16. > :10:20.effective. We will have the Philippine Finance Secretary to
:10:21. > :10:24.speak with us about the growth numbers when they are out in the
:10:25. > :10:27.next edition of Asia Business Report. Thank you so much for
:10:28. > :10:43.investing your time with us. I am Rico Hizon. Bye for now.
:10:44. > :10:44.I am Mike Embley in London with