Browse content similar to 11/03/2016. Check below for episodes and series from the same categories and more!
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Now on BBC News all the latest business news live from Singapore. | :00:00. | :00:15. | |
The European Central Bank cuts rates even further. Is it a sign of things | :00:16. | :00:23. | |
to come in Asia? And how India is looking to private investment for | :00:24. | :00:26. | |
more innovation in its struggling health system. | :00:27. | :00:34. | |
Welcome to Asia Business Report. There's been a major intervention by | :00:35. | :00:43. | |
the ECB to try to revive the eurozone's flagging economies. In a | :00:44. | :00:48. | |
move that surprised the financial markets, the ECB cut three interest | :00:49. | :00:53. | |
rates and announced it was pumping an extra 20 billion euros a month | :00:54. | :00:57. | |
into the system. But some analysts fear it may not be enough to restore | :00:58. | :01:02. | |
growth, as our economics editor explains. | :01:03. | :01:06. | |
The eurozone has an economic problem. It's six? A central bank | :01:07. | :01:11. | |
that wants to print money and offer interest rates so low they are | :01:12. | :01:15. | |
actually negative -- it's fixed. Mario Draghi is the man charged with | :01:16. | :01:20. | |
rescuing those sickly economies that are suffering deflation and slowing | :01:21. | :01:25. | |
growth. It's a fairly long list of measures, and each one of them is | :01:26. | :01:32. | |
very significant and devised to have the maximum impact into boosting the | :01:33. | :01:41. | |
economy and the return to price stability. So we have shown that we | :01:42. | :01:47. | |
are not short of ammunition. So what does that ammunition look like? The | :01:48. | :01:54. | |
ECB cut its three main interest rates to try to stimulate growth. | :01:55. | :01:57. | |
The central bank is so keen to get banks lending again it lowered one | :01:58. | :02:03. | |
of its key rates, the deposit rate, two -0.4%, a negative interest rate | :02:04. | :02:09. | |
which has the effect of charging banks for depositing money. | :02:10. | :02:12. | |
Quantitative easing, the increase in the supply of central bank money to | :02:13. | :02:19. | |
eurozone economies, will be raised to 80 billion euros a month. That's | :02:20. | :02:24. | |
up by 20 billion euros. Mr Draghi also revealed cheap loans to banks | :02:25. | :02:28. | |
will be provided in a concerted effort to rescue ailing eurozone | :02:29. | :02:34. | |
economies. Now, will it work? That's a question I put to a former | :02:35. | :02:38. | |
financial regulator. I'm still not convinced it's going to pull the | :02:39. | :02:43. | |
Euros own out of its medium-term problem of low growth and low | :02:44. | :02:47. | |
inflation, because I think we are literally at the limit of what | :02:48. | :02:51. | |
central banks can achieve by simply reducing interest rates still | :02:52. | :02:56. | |
further and larger cutely operations. Mr Draghi agrees, at | :02:57. | :03:01. | |
least in part, the ECB cannot be a 1-man rescue mission. Some of the | :03:02. | :03:06. | |
problems are that central banks can't do it alone, governments have | :03:07. | :03:10. | |
to do their bit with structural reforms and in some cases fiscal | :03:11. | :03:14. | |
policy as well. For central banks, they can do more, but there are | :03:15. | :03:18. | |
risks associated with some of those policies. Frankfurt, the ECB's home, | :03:19. | :03:24. | |
and the place under scrutiny for unorthodox economic policies that no | :03:25. | :03:29. | |
one is yet sure will actually work. Here in Asia we have recently seen | :03:30. | :03:34. | |
the bank of Japan introducing negative interest rates with that | :03:35. | :03:37. | |
same objective, to help boost growth. They meet again next week. | :03:38. | :03:43. | |
There is also a Fed meeting coming up. What does the ECB decision mean | :03:44. | :03:47. | |
in the wider global context? What pointers can we take for Asian | :03:48. | :03:54. | |
economies? People take a lead from the markets, which viewed it quite | :03:55. | :03:58. | |
negatively. The sense in the market is that we're not really sure if | :03:59. | :04:02. | |
this works and we are worried they seem to be reaching the limits of | :04:03. | :04:06. | |
what they can do with negative rates, maybe therefore the reaction | :04:07. | :04:11. | |
would be slightly negative. The fact Asian central banks and the ECB as | :04:12. | :04:15. | |
well have had to resort to this relatively dramatic measure, what | :04:16. | :04:20. | |
does that say about growth in the world economy? Certainly growth in | :04:21. | :04:26. | |
Europe and Japan isn't great, but it's more that they're worried first | :04:27. | :04:29. | |
about the market volatility earlier in the year and about the | :04:30. | :04:33. | |
persistently low level of inflation. In some ways the rest of | :04:34. | :04:37. | |
Asia doesn't really have to worry about that. The growth rate may not | :04:38. | :04:42. | |
be fabulous but it's reasonably steady, about where it has been for | :04:43. | :04:46. | |
the last few years, and they do have room to loosen policy to support | :04:47. | :04:50. | |
growth if they need to, something lacking in Europe. Looking at Japan, | :04:51. | :04:54. | |
they have shown they have taken rates to negative territory in an | :04:55. | :04:59. | |
attempt to boost growth. What does a country like Japan do, how much | :05:00. | :05:07. | |
further can it get? This is the problem, the markets saw the move | :05:08. | :05:10. | |
for Japan badly, the yen strengthened and if it would have | :05:11. | :05:13. | |
affected it would have weakened. The Bank of Japan has made a huge effort | :05:14. | :05:18. | |
in the past few years. It had some success, the labour market is tight, | :05:19. | :05:23. | |
profitability is good, it is quite an achievement in Japan after 15 | :05:24. | :05:28. | |
years of deflation. But it's not really moving fast enough and the | :05:29. | :05:31. | |
Central Bank seems to be running out of ammunition. Absolutely. What are | :05:32. | :05:38. | |
the tools that central banks have? Or do the governments need to step | :05:39. | :05:43. | |
in to fix these problems? The central Bank has made fairly heroic | :05:44. | :05:46. | |
efforts, especially in Japan, in recent years. The structural reform | :05:47. | :05:53. | |
has been lacking, especially in the case of Japan and arguably in Europe | :05:54. | :05:59. | |
as well. So you need more of a concerted approach to try to boost | :06:00. | :06:03. | |
growth, and that's been lacking. Briefly, what will the US Fed do | :06:04. | :06:08. | |
next week? Everybody thinks they will do nothing in terms of interest | :06:09. | :06:12. | |
rates but I think they should raise them, things are picking up, but I | :06:13. | :06:16. | |
think they will hold off until June, maybe April, and it's a signal | :06:17. | :06:21. | |
on how many times they will raise interest rates this year which is | :06:22. | :06:27. | |
important. Apple has accused the US justice | :06:28. | :06:31. | |
department of trying to smear the company over claims the company | :06:32. | :06:35. | |
helps China access iPhones. The accusation was made as part of the | :06:36. | :06:39. | |
San Bernardino shooting case. The FBI wants Apple to help them access | :06:40. | :06:45. | |
the gunmen's phone but the FBI says that Apple's own data says that | :06:46. | :06:51. | |
China asked them for data in the first half of 2015 and Apple | :06:52. | :06:57. | |
produced data 74% of the time. The amount India spends on | :06:58. | :07:01. | |
healthcare compared to the size of its economy is among the lowest in | :07:02. | :07:06. | |
the world, that means private firms are stepping in for those that can | :07:07. | :07:10. | |
afford it. This has inspired a whole host of companies, both big and | :07:11. | :07:14. | |
small, to work on new, innovative services. But how much of a | :07:15. | :07:19. | |
difference can they really make? We went to Bangalore to find out. | :07:20. | :07:26. | |
It may look like a pizza delivery service, but what's actually being | :07:27. | :07:30. | |
brought to people's doorsteps is a sip is dictated the rise for testing | :07:31. | :07:39. | |
eyesight. -- sophisticated. One idea to tackle a complicated problem | :07:40. | :07:44. | |
where hospital visits can be daunting and expensive. Getting ill | :07:45. | :07:48. | |
and paying medical bills has driven more than 60 million putt Indians | :07:49. | :07:53. | |
into poverty each year, so could private businesses be part of the | :07:54. | :07:57. | |
answer? Bringing down costs and bringing more efficient healthcare | :07:58. | :08:00. | |
services to more people. And businesses are getting new | :08:01. | :08:07. | |
inventions into hospitals too, like this monitor used during pregnancy. | :08:08. | :08:13. | |
Smaller unless expensive than the other machines. A mobile phone app | :08:14. | :08:17. | |
can monitor the heartbreak of a fetus when it is strapped on. This | :08:18. | :08:22. | |
is our first product, which we have designed to be used by low skilled | :08:23. | :08:28. | |
health workers, which makes it cost-effective and good for the | :08:29. | :08:33. | |
Indian healthcare scenario. We feel more devices like these need to come | :08:34. | :08:39. | |
because 75% of the major capital equipment, and that equipment, which | :08:40. | :08:43. | |
is imported, is not cost sensitive, designed for India, it is | :08:44. | :08:47. | |
inefficient and not accessible to a lot of Indian cases. And it's not | :08:48. | :08:55. | |
start-ups. Global giants like IBM are also bringing the latest | :08:56. | :08:59. | |
technology here. Within India you need an amplification of a broader | :09:00. | :09:04. | |
problem within healthcare, which is clinicians have very little time to | :09:05. | :09:10. | |
with patients. In the US the ratio of clinicians to patients is 100 to | :09:11. | :09:17. | |
one, in India it is 1600 to one, so the time pressure is greater. If we | :09:18. | :09:22. | |
get the workflow right in India we know it will work anywhere in the | :09:23. | :09:26. | |
world, so it's an exciting opportunity to bring this solution | :09:27. | :09:31. | |
to market within India. Nearly 1 million Indians die every | :09:32. | :09:35. | |
year because of inadequate healthcare facilities. About 700 | :09:36. | :09:40. | |
million people have no access to specialist care. And as the country | :09:41. | :09:44. | |
grapples with growing healthcare costs, and a shortage of doctors, | :09:45. | :09:49. | |
technology driven innovation and change is the only hope many Indians | :09:50. | :09:56. | |
have for better medical treatment. Let's take a quick look at the | :09:57. | :10:00. | |
markets. US markets overnight pretty much moved in the same direction as | :10:01. | :10:04. | |
those in Europe where stocks initially surged on the ECB moves to | :10:05. | :10:08. | |
cut interest rates, but fell after the ECB chief said the bank didn't | :10:09. | :10:12. | |
see room for further rate cuts. That having an impact in Asia. Let's have | :10:13. | :10:20. | |
a look at Japan. The Hang Seng down 0.4%. That anxiety and nerve is this | :10:21. | :10:26. | |
likely to be across Asia today. -- nervousness. Thanks for watching. | :10:27. | :10:27. | |
Stay with us. | :10:28. | :10:29. |