25/11/2015 Asia Business Report

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

Rock bottom and still sliding. Iron ore prices have a new decade low.

Following in the family. How this third generation business is

competing on the High Streets of Hong Kong. Welcome to Asia Business

Report. The price of iron ore, the key ingredient of this deal, has hit

a fresh ten year low. It closed at $43. $43.89 a ton. Some say it has

got much further to fall. This economist says it will go below $40

a ton by the end of the year and will be in the Turkey is at the end

of 3016. This is why. -- thirties. -- 2016. It is not sustainable. I

think the demands will cool off white a lot in the next year. --

quite. China's production and demand will fall a lot. There will be some

pushing of the price down to where only the largest producers can be

profitable. There will be many bankruptcies. Number one, there are

Chinese high cost producers that are used to 100 million tons. Most of

the world will need to be priced out. That will be a painful process.

I put that question to an analyst in Sydney. When you look at the market

and how it is priced at the moment you can see that looking 2-3 years

out it will be lower. The market is already rising levels below $40 in

the next couple of years. -- pricing. When you look at it there

is a lot of capacity coming to the market. Whether it will stay at

those levels is another thing. As he correctly pointed out, as the price

goes low you lose our lot of tons through minds shutting down. It is

through that that you will find the price will be more supportive. --

mines. The you see the big miners will continue to ramp up production?

That is what we have seen, ironically, because they are

low-cost operators and are putting more iron ore on the market. If you

look at the export that continue to go at record levels I don't see that

ranging. -- exports. What is more important is what is being produced

is consumed. -- reducing. Those that cannot will actually be taken over

or go out of business or shut down. BOC price is sitting at the $30 mark

for a few years to come? -- Do you see the. Or are you more optimistic

and say $50 a ton? I am more optimistic. When you look at the

price of iron or where it is and where China is positioned, China

requires growth at 7.5 to 8% to keep the economy stable. -- iron ore. I

think the more negative the data is that comes out of China the more

stimulus they will put in the market and there will be more demand. You

are optimistic. Does this more positive outlook... Some people are

thinking, why do I care about the iron ore? But it is about the

broader economic Outlook. China is still putting stimulus on the table.

-- outlook. We have to ask a why I be looking at increasing interest

rates? -- why are they looking at. Consumption will dramatically pick

up and as a result of that capacity in the market and the spare capacity

we are in at the moment, in my mind, it will be taken up in the market.

That will create stable, if not, higher prices are quite China's

slowing economy is not just causing those problems, but key issues for

other businesses like the largest private investment fund for the

mainland. -- prices. The executive vice president told Sharanjit Leyl

that now is a good time to go global. We believe that China is at

a stage where we will see more companies going global and becoming

international players in the next ten years. I think for an investment

company this is a good opportunity. To help them grow globally as well

as make good profit, I mean. But the signals from China are not

reassuring. Six rate cuts in a year and constant stimulus to reignite

the economy... Had is that impact your firm? It will be more difficult

to invest ethically in China because the economy is slowing down. -- how.

But we can also see, because of the slowdown, many Chinese companies are

trying to grow their business overseas. That is also a good sign

for us. In my personal opinion, I guess, starting a US business in a

slowdown period is probably a good thing, rather than in peaktime. You

can pick up some bargains, is what you are saying? No, we see good

opportunities. In other news, Ali Abbas insurance is setting up a

joint-venture with China's search engine. -- Alianz. It is to

establish an on line insurer in the country. It only brings in a small

part of their overall revenues but China's expanding middle-class has

seen increased demand for insurance products. The Chinese smartphone

maker has launched its latest handset to revive dwindling sales.

Revised three months after its loss is, it is relatively cheap and has a

fingertips and so. -- predecessor. -- fingertip sensor. China is

increasing the minimum wage to boost consumer spending and economic

growth. That economy has leapt into recession twice Shinzo Abe came to

power nearly three years ago. -- Japan. His government has been under

pressure to improve the economy's performance. Hong Kong was once the

factory of the world making everything from electronics to

toys. But after it opened up in the 19 50s many live to the mainland. --

1950s. Decades later only a handful of businesses remained there. One is

making shoes. Were told how the enterprise is revamped. -- We are

told. TRANSLATION: It was founded in 1958 by my grandfather. It was just

a booth under a staircase. It was a smart shop that sold all kinds of

bugs, mainly Chinese slippers. -- products. I started helping out at a

very young age. Slowly, I fell in love with traditionally embroidered

shoes. Dan Norris started to get involved in the designing. -- then I

started. That is when I decided I could invest one whole life in the

business. Before slippers were warned mainly in the last. -- my.

Then I tried to modernise the design and use new materials. -- worn. Now

they can be used outside. These are the traditional shoes revamped. Many

people like to wear high heels at their weddings. Traditionally, they

were all flat shoes. I get a lot of inspiration from my daily life. I

like to hang out in different places and get inspired by many things. I

like to explore the neighbourhood around my shop. I spend hours

looking for fabrics and designs. I often forget out what to do during

my next season during this process. -- figure out. I started social

media to attract more younger customers. People say, I didn't know

these shoes were still being sold. All our products are handmade. My

biggest obstacle is that I don't have enough staff. Very few people

in Hong Kong choose to make shoes as a full-time job. Another obstacle is

the rent prices. We were forced out of our former location in Hong Kong.

Since we moved, we have lost a lot of older customers. They weren't

able to find us. The customers we were able to keep worthy younger

ones who kept up with us on social media. More than half of our

customers are now under 40. -- were the. I hope to keep doing this, not

just to keep it in the family, but to broaden interest among fellow

designers to get into this business, to do this with me. It is

time for just a quick check of the Asian markets. You can see that most

of them are just ever so slightly down. The Nikkei is down 120 point.

The All Ords is also down. That is it for Asia Business Report. --

points. Thank you for watching.