:00:16. > :00:24.Leaders from around the Pacific touchdown in Manila. Trade and
:00:25. > :00:28.growth are on the agenda, but Paris and the South China Sea dominate
:00:29. > :00:32.Apec. And it wouldn't be Apec without matching outfits for every
:00:33. > :00:42.litre. We give you a sneak peek of what they will wear for this year's
:00:43. > :00:47.family photo -- leader. Good morning, Asia, hello world. Bet you
:00:48. > :00:53.could join us for this special edition of Asia Business Report. I
:00:54. > :00:56.am Rico Hizon, live from my home city here in Manila, which is
:00:57. > :01:03.hosting the Asia-Pacific economic Corporation summit. Moments ago, the
:01:04. > :01:08.Alibaba founder wrapped up his session and he told delegates he
:01:09. > :01:12.wants to support all small and medium-sized enterprises, for them
:01:13. > :01:19.to grow bigger. And he said that companies should compete, but they
:01:20. > :01:27.should not copy. Also, America's President Barack Obama, Chinese
:01:28. > :01:30.President Xi Jinping and Shinzo Abe are among the 18 leaders who will
:01:31. > :01:35.discuss the big issues facing Asia and the Pacific. Apec has 21 members
:01:36. > :01:39.working towards free trade throughout the region. It is
:01:40. > :01:44.terrorism, the South China Sea, territorial disputes and climate
:01:45. > :01:49.change which are expected to be talked about today but it is trade,
:01:50. > :01:53.business and economic issues which dominate the official agenda.
:01:54. > :01:56.Earlier I spoke to the executive director of the Apec Secretariat,
:01:57. > :02:00.and I asked him what other priorities in this meeting. So far
:02:01. > :02:03.we have had trade ministers and foreign ministers meeting and going
:02:04. > :02:06.through the whole list of things that Apec has been doing for the
:02:07. > :02:10.year. Some of that is about trying to improve growth generally, some of
:02:11. > :02:16.it is inclusive growth, small-business, services, women in
:02:17. > :02:19.the economy, a lot initiatives. A lot of initiatives indeed, inclusive
:02:20. > :02:23.growth, building economies. But is the political let to support the
:02:24. > :02:29.small and medium-size enterprises which make of about 90% of Apec?
:02:30. > :02:33.They can be 97% of Apec but they're not 97% of trade and that is what we
:02:34. > :02:37.are trying to do. We are trying to up and get the advantages of this
:02:38. > :02:46.very strong dynamic around the region. And what he really needs, Dr
:02:47. > :02:49.Bollard, is a live level playing field, financing. We're looking at
:02:50. > :02:55.financing, trade agreements, trade facilitation, red tape at borders,
:02:56. > :02:58.making sure they can tap into global supply chains. Electronic
:02:59. > :03:03.technologies are making that much easier and we want to make sure that
:03:04. > :03:06.works for them. Apart from Apec, of course, everyone is looking forward
:03:07. > :03:09.to the meeting of the transpacific partnership members on the sideline
:03:10. > :03:13.at this it. Do you think it will eventually be ratified, and when
:03:14. > :03:18.will it be? We don't know that, that is not an Apec event! We observe
:03:19. > :03:22.that, we also see progress on other trade agreements around the region
:03:23. > :03:26.and we are interested how they might come together as a free-trade area
:03:27. > :03:30.for Asia and the Pacific. At the moment, apart of course from the
:03:31. > :03:35.Apec summit, everyone is talking about the Paris attacks. How much is
:03:36. > :03:42.the security situation overshadowing this summit? I don't think it is. We
:03:43. > :03:47.do economics. I expect leaders... Ministers did a minute's silence,
:03:48. > :03:51.but I suspect they will talk about it and want to pass on their message
:03:52. > :03:55.but say what is this really all about? If we can get strong economic
:03:56. > :04:00.growth, that help stabilise the situation is a lot, and that is what
:04:01. > :04:07.we are all about, economic growth. That was Dr Bollard, executive
:04:08. > :04:11.director of the Apec directorate. China's growing economy is a hot
:04:12. > :04:15.topic here. Some suggest the outlook is still bright and one of them is
:04:16. > :04:19.America's largest retail chain, Walmart. Their earnings were
:04:20. > :04:22.released yesterday and while earnings were stronger than
:04:23. > :04:28.expected, sales and international segment fell 11%, hit the stronger
:04:29. > :04:32.dollar. For China, the retailer once had an aggressive plan to move into
:04:33. > :04:37.the country, with more than 1000 stores. I asked Scott Price, the
:04:38. > :04:41.chief executive of aggro to Asia, how China's slowdown was affecting
:04:42. > :04:45.the business. The challenge that China has is not insurmountable, but
:04:46. > :04:49.it is big as they change their economy from an export driven one to
:04:50. > :04:54.services and consumption. Obviously with 400 plus stores in 165 cities
:04:55. > :04:59.in China, we are a pretty good barometer for how that process is
:05:00. > :05:03.moving. We are optimistic. We are long on China. I think when you go
:05:04. > :05:09.from the fast lane down to just 70 miles an hour, it may feel slower
:05:10. > :05:12.but it is still pretty fast. Mr Price, you are indeed expanding in
:05:13. > :05:17.mainland China, but much less than the original plan. Why is that? When
:05:18. > :05:22.you want to open a new store you have to hire 200 -300 new people,
:05:23. > :05:24.you have to keep them trained. There is quite a bit to ensuring healthy
:05:25. > :05:29.growth so when we talk about growth we want to make sure that is growing
:05:30. > :05:33.in the right way. So for us that is growing at the right level but as
:05:34. > :05:37.well focusing on things like the safety, training, complaints are
:05:38. > :05:41.cetera. So we think it is reasonable and skilled growth. Walmart is a
:05:42. > :05:46.bricks and mortar operation. How competing with the online e-commerce
:05:47. > :05:51.market? We continue to invest, we have about the Mac announced 115 new
:05:52. > :05:57.hypermarkets. We completed a new acquisition of a large e-commerce
:05:58. > :06:04.player out of Shanghai. We continue to offer our customers
:06:05. > :06:13.online/off-line opportunities. On Tuesday we discovered that Alibaba
:06:14. > :06:21.made $40 billion. How did Walmart fear? We don't release powers on a
:06:22. > :06:21.specific date, 11/11. That is a big day for our online world. We are
:06:22. > :06:28.quite comfortable with the performance. We had a lot of great
:06:29. > :06:34.deals, we think, online, and we think we performed pretty well. What
:06:35. > :06:43.lessons did Walmart learn from 11/11? Singles Day? If you look at
:06:44. > :06:45.the Chinese customer, they are interested in authenticity. Second
:06:46. > :06:49.is the quality. There is an increasing demand for quality in all
:06:50. > :06:52.product, and the third is the best possible price. What we found on
:06:53. > :06:58.Singles Day is that you don't have to go out with a whole raft of
:06:59. > :07:02.loss-making discounts, that if you focus on delivering those three
:07:03. > :07:06.things, you can build a very healthy business. And for us that is what we
:07:07. > :07:11.are looking for, again growth the right way. That were Scott Price,
:07:12. > :07:16.the CEO of Walmart Asia. Yesterday we reported on how the slow pace of
:07:17. > :07:20.infrastructure and development here in the Philippines hampers growth
:07:21. > :07:23.for companies both big and small. And the international logistics
:07:24. > :07:31.giant FedEx relocated its Asia hub from Manila two China six years ago
:07:32. > :07:36.because of poor infrastructure. I spoke to David Cunningham, Chief
:07:37. > :07:40.Executive Officer of FedEx, to talk about what needs to happen to lure
:07:41. > :07:44.the company back, and how it has benefited from the move to the
:07:45. > :07:51.mainland. We moved our hub because of the capabilities, airspace space,
:07:52. > :07:55.runways, runways, the workforce capabilities, that we had in China.
:07:56. > :07:59.And so we have done very well in that. For FedEx to come back in a
:08:00. > :08:03.big way in the Philippines, what needs to happen in terms of
:08:04. > :08:12.infrastructure? Until the Philippines has a significant
:08:13. > :08:20.investment in capability and runways, then those are really not
:08:21. > :08:24.options for us. But I hope that Manila and the Philippines will
:08:25. > :08:29.continue to progress, as it has over the last five years with the
:08:30. > :08:32.President, by making targeted infrastructure investments. But
:08:33. > :08:42.also, and probably most importantly, by using the TPP, are coming a TPP
:08:43. > :08:45.member, using the TPP, improving the transparency, using the digital
:08:46. > :08:49.economy to increase capacity. Because one of the things we think
:08:50. > :08:52.about is we think about infrastructure, and we think about
:08:53. > :08:56.it in concrete and steel and roads and buildings. But with the digital
:08:57. > :09:04.economy it is not all about that any more. You can scale Customs
:09:05. > :09:10.capabilities, you can scale infrastructure capabilities by one,
:09:11. > :09:13.ten, 1000, by the use of those techniques. And so I think that is
:09:14. > :09:18.where maybe the Philippines can lead that next revolution. Because you
:09:19. > :09:21.have incredibly technically capable people. Those just need to be
:09:22. > :09:27.integrated with government policy. And that was David Cunningham from
:09:28. > :09:31.FedEx. And now, before we go, no Apec summit would be complete
:09:32. > :09:35.without a family photo of the leaders wearing traditional shirts
:09:36. > :09:39.of the host country. And this year, being in the Philippines, all the
:09:40. > :09:44.leaders will be wearing vests. It is made partly from pineapple fibre.
:09:45. > :09:49.And being a Filipino, I can tell you that I have worn one many times
:09:50. > :09:53.before. And take a look at this. Here is my favourite. I wear at all
:09:54. > :09:58.the time during special occasions, like weddings and formal parties. I
:09:59. > :10:02.hope I could wear one during Asia Business Report. We will have to
:10:03. > :10:06.wait until tomorrow, Thursday, to see the leaders in their respect of
:10:07. > :10:12.garments. Before we go, here is a quick look right now at the markets.
:10:13. > :10:20.Currently they are mixed in mid-morning Asian trade. Japan's
:10:21. > :10:23.Nikkei 225 is up on plans from their government. Australia is down and
:10:24. > :10:29.the Hang Seng is up slightly. Thank you so much for investing your time
:10:30. > :10:31.with us on Asia Business Report. I am Rico Hizon in Manila, goodbye for
:10:32. > :10:36.now. The top stories this hour: The New
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