:00:16. > :00:22.Going global. From start to worldwide giant, Alibaba get set to
:00:23. > :00:28.list in the US stock market. But can it take on its American rivals? And
:00:29. > :00:35.China's is oil company gets set to sell off $17.5 billion worth of its
:00:36. > :00:40.retail business. `` China's biggest oil company. Thank you for joining
:00:41. > :00:45.us for this edition of Asia Business Report on BBC World News, I am Rico
:00:46. > :00:49.Hizon. Alibaba's public offering is making waves, not just on Wall
:00:50. > :00:54.Street, but on the West Coast of America as well. A chunk of its $500
:00:55. > :00:57.billion investment over the year has been in Silicon Valley, but as our
:00:58. > :01:02.North American technology correspondent reports, not everyone
:01:03. > :01:10.there is welcoming the CEO with open arms. Ridesharing San Francisco
:01:11. > :01:23.style. His moustachioed mauve eels, the hallmark of this smartphone app
:01:24. > :01:32.`` mobiles. The start`up has been on quite a journey, a key investor in
:01:33. > :01:35.the $200 million funding round earlier this year. That was just the
:01:36. > :01:40.latest in a spending spree. Its venture in mobile spreading way
:01:41. > :01:44.behind transport into areas as diverse as communications, gaming,
:01:45. > :01:48.and app search. So what is driving these investments? This Silicon
:01:49. > :01:54.Valley venture capitalist himself invested in Alibaba a decade ago.
:01:55. > :01:58.Jack is very astute, a operator and investor. I think they are trying to
:01:59. > :02:02.learn as much as they came, understanding that they are Chinese,
:02:03. > :02:05.they are trying to learn as much as they can about the US market. The
:02:06. > :02:07.tech market type economy in general. And obviously many of them have a
:02:08. > :02:13.strategic aspect, which they are trying to bring back into China and
:02:14. > :02:17.using here is a beachhead to expand here in the US. In those potentially
:02:18. > :02:22.expansionist intentions are getting some in Silicon Valley concerned.
:02:23. > :02:26.Right now Alibaba's e`commerce presence is subtle or stop its
:02:27. > :02:31.retail outlet doesn't so much as carry any Alibaba ranting. Some of
:02:32. > :02:36.observers say it e`commerce ambitions could eventually pose a
:02:37. > :02:43.real threat to established companies like eBay. Alibaba does they can't
:02:44. > :02:47.just go into the US and drop. Some of their services they want on the
:02:48. > :02:51.US and expected to work. They will take a long`term approach and try to
:02:52. > :02:55.introduce other services slowly but surely into the US. But they have a
:02:56. > :02:59.ton money and experience and you can never discount Alibaba. But for
:03:00. > :03:04.start`ups needing investment in their quest to become the next big
:03:05. > :03:08.thing, Alibaba's investment is positively welcome. Chinese funding
:03:09. > :03:12.these days is seen as a badge of credibility. It is clear that
:03:13. > :03:16.Alibaba's presence here in Silicon Valley is not a 1`way street. Many
:03:17. > :03:17.established US firms may fear what they see as the encroachment by the
:03:18. > :03:29.Chinese Internet giant on But for many others it is a gateway
:03:30. > :03:34.into China itself. Not just in new market, but the world's guest.
:03:35. > :03:38.Alibaba might be a household name in China, but this is not necessarily
:03:39. > :03:42.the case beyond its borders. In part of the ambition is to raise
:03:43. > :03:46.awareness of the company among consumers in North America and
:03:47. > :03:49.Europe. I spoke to a representative from advertising giant McCann, who
:03:50. > :03:55.shared his insights into what Alibaba needs to do to attract
:03:56. > :03:59.consumers in these markets. It is known for the best transaction. That
:04:00. > :04:03.is what it does. One site has it all. The reality is it will have to
:04:04. > :04:07.make some changes if it wants to build within those two geographic
:04:08. > :04:15.locations. Do you think that Alibaba has what it takes to be able to
:04:16. > :04:19.break into the American market and give American consumers that sense
:04:20. > :04:22.of experience? I would never underestimate the CEO. He has proved
:04:23. > :04:27.to be an incredible businessman and an incredible showband. He knows
:04:28. > :04:33.what it takes to find the consumer `` show man. The question is whether
:04:34. > :04:33.he wants to do that. He seems to believe that the best marketplace is
:04:34. > :04:38.one looking at the results in China,
:04:39. > :04:42.ears right. The question is whether he will have to adapt for the United
:04:43. > :04:45.States. I think in the long`term if you want a significant part of the
:04:46. > :04:51.market you will have to make changes. If he makes that adoption?
:04:52. > :04:57.What if he adapt to what the US consumers want? Can he beat the
:04:58. > :05:03.Amazon and the eBay is? He is not just looking to see whether he can
:05:04. > :05:04.eat those companies, he is in a race against Walmart, against a lot of
:05:05. > :05:07.individually oriented Rands who have good consumer presence right now on
:05:08. > :05:14.the web and to a way for consumers to find their
:05:15. > :05:21.goods. Many consumers still prefer shopping with those companies. He is
:05:22. > :05:24.a marketplace, they are brand specific areas. I think this is a
:05:25. > :05:28.race with which still has a lot to be run. Can Alibaba educate American
:05:29. > :05:31.consumers with a transaction oriented philosophy? Without a doubt
:05:32. > :05:35.he can bring some things which right now are not necessarily the same as
:05:36. > :05:39.in the United States. I'm not sure he can educate them, but he can make
:05:40. > :05:42.some of the things that Alibaba is doing more appealing for an American
:05:43. > :05:51.audience. There is no doubt that he can do that. What he still has to
:05:52. > :05:55.then figure out is whether it is a sensory, wholesome experience. Do I
:05:56. > :05:56.get the experiential satisfaction I get in these other places? Can Asian
:05:57. > :06:01.e`commerce sites succeed in the with their existing business models?
:06:02. > :06:06.No, I think they still need to do more about the security of data,
:06:07. > :06:09.they still have to engender more confident about privacy, they still
:06:10. > :06:13.need to be more knowledgeable about American consumer experience. Those
:06:14. > :06:18.elements which the Asian business sites will have to adapt to. And
:06:19. > :06:22.other business is making headlines, China has
:06:23. > :06:27.showing its weakest growth in industrial output in more than five
:06:28. > :06:30.years. The industrial debt measures output at nine factories and
:06:31. > :06:35.workshops. The numbers released over the weekend also revealed
:06:36. > :06:38.growth in retail sales and weaker than expected investment in
:06:39. > :06:42.infrastructure. Analysts say the new numbers are raising concern over
:06:43. > :06:50.China's current economic strength. The UK`based retailer hones4u is set
:06:51. > :06:56.to fall into administration, putting hundreds of jobs at risk. The chain
:06:57. > :07:03.says 550 stores would all be closed on Monday `` Phones4u. Phones4u
:07:04. > :07:05.blamed its position on the decision not to renew its contract, which
:07:06. > :07:13.came after Vodafone made a similar move. South Korean conglomerates
:07:14. > :07:18.Samsung and LG are in the midst of a strange dispute. Samsung accuses
:07:19. > :07:22.some LG employees of deliberately destroying washing machines in
:07:23. > :07:26.stores in Germany. Samsung says the vandalism took place earlier this
:07:27. > :07:32.month ahead of a major trade fair in Berlin. LG alleges that two machines
:07:33. > :07:37.were damaged, but said it was done accidentally. The case is now being
:07:38. > :07:45.investigated. China's state owned oil giant China Trolley and chemical
:07:46. > :07:49.Corporation is set to sell a whopping $17.5 billion stake in its
:07:50. > :07:57.retail businesses `` China Petroleum. Its retail side includes
:07:58. > :08:02.tens of thousands of fuel stations and convenience stores. The sale
:08:03. > :08:05.comes as china's government looks to restructure and boost productivity
:08:06. > :08:11.in its major state owned companies. For the latest let's cross to Hong
:08:12. > :08:16.Kong. This sale, at $17.5 billion, will be the biggest privatisation
:08:17. > :08:24.since the President came into power. That's right. The biggest since the
:08:25. > :08:28.end of 2012. Now the administration has made it very clear that they
:08:29. > :08:32.want to bring in private capital and private know`how into some of the
:08:33. > :08:38.country's biggest state owned companies, and you don't get much
:08:39. > :08:42.bigger than this. They have more than 30,000 petrol stations around
:08:43. > :08:47.the country, and around 20,000 convenience stores as well, as other
:08:48. > :08:51.assets. They are expanding overseas. If you think about what these
:08:52. > :08:54.private companies are being brought in to do, it does make sense.
:08:55. > :09:04.Interestingly, unlike most other companies, they actually bring in
:09:05. > :09:08.99% of their business. That is just gas and oil. In other parts of the
:09:09. > :09:13.world, things like car washing, going to the convenience store, next
:09:14. > :09:19.to a petrol station, buying food, drinks, perhaps alcohol, it could
:09:20. > :09:22.account for up to 50% of revenue. And that is something that Sinopec
:09:23. > :09:26.is looking at. And I can certainly tell you, when you do those long
:09:27. > :09:30.drives throughout China, you certainly wish these petrol stations
:09:31. > :09:35.would have other services. And which foreign investors would be
:09:36. > :09:40.interested in buying a stake in Sinopec? A whole list of them. This
:09:41. > :09:43.was a huge deal. So it was more than just a few investors. Let me just
:09:44. > :09:47.share with you some of the big names. Really some of the biggest
:09:48. > :09:54.funding management names in China. Harvest Fund, China Life Insurance.
:09:55. > :09:59.10 cents is another Internet giant in China, and they have signed up
:10:00. > :10:07.with Sinopec to work on its digital commerce. And before we go, a quick
:10:08. > :10:11.look at the markets. Asia are currently stumbling to start the new
:10:12. > :10:12.trading week. Most are in negative territory.
:10:13. > :10:20.trading week. Most are in negative Thank you for investing your time
:10:21. > :10:26.with us. I am Rico Hizon. Goodbye for now. The top stories this hour:
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