11/04/2016 Asia Business Report


11/04/2016

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

:00:00.:00:15.

Australia tries to sell more than just commodities and beach holidays

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to the Chinese. And Singapore drills deep, beating up Britain for a

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contract to build oil rigs for Scotland. Welcome to Asia Business

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Report. It is the biggest trade delegation ever from Australia to

:00:40.:00:46.

China for all of this week. 1000 business representatives and the

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trade minister are touring China to boost ties between the two

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countries. Bilateral trade still at just under $100 billion last year.

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It is especially crucial for Australia because China is its

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biggest trading partner in both exports and imports. More from

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Shanghai. How do you sell Australia to the Chinese? It looks like this.

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A hunky men holding to mobsters and trips on the barbie. A bit

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old-fashioned, but it works. Plenty of Chinese go to holiday in

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Australia. Plenty send their children to be educated there. As

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trade mission over the following few days, and it is a massive effort, is

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aimed at broadening their relationship. They are trying to get

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the Chinese to buy more services from Australia. We have leaders from

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1000 Australian businesses coming in this delegation and senior

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politicians. They are trying to sell not just tourism but education as

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well, and the agriculture business. What does say about the relationship

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between Australia and China? It has changed a lot. The days of the

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Chinese buying everything up in Australia are over. This is about

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time to sell far more services to the people of China from Australia.

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It is very important. No underestimation to say the future of

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the study's economy depends in part on its trade relationship with this

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country. How much do they reckon they will raise? Last time they did

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this in 2014, the government said it led to an injection of some 3.5

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billion US dollars. They want the same or more this time around.

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Cambodia is another country which counts on growing investment from

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China. Its economy is rapidly growing but remains one of the

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poorest in the region. It is struggling with its violent past and

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political uncertainties. What are its prospects for the future?

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Earlier I spoke with the US ambassador to Cambodia. Cambodia is

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a very dynamic and very positive economic growth story. It was a

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positive development story. They have had 7% economic growth now for

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more than a decade. Very strong growth in manufacturing,

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construction, and tourism as well as agriculture. At the same time, and

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not surprisingly, their social indicators have done very well.

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Health, education. Very positive. Now Cambodia is a much better

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trained and healthier workforce than before. Police are starting to take

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notice. You say companies are taking notice and it is a positive

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development, but there is a fair share of corruption, ranking among

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one of the most corrupt countries according to transparency

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International. How can investors look to it in spite of all these

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problems? Corruption is a problem in Cambodia and other countries as

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well. The government has acknowledged that. They have taking

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interesting steps that directly impact on business like setting up a

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single window as well as online business registration. They reduce

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the amount of business interaction with government. They have a long

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way to go, especially improving their court system. As this is not

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yet have doubled taking cases to court. They have to go to

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international arbitration. That is expensive. Politically the

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government has not really changed since the 1990s. The president is

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very much keen on Chinese investment. Is it perhaps too late

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for the Americans and others? They have had the same government in

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place for quite a few years. They have elections every five years,

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though, and over that period there has been that peace and stability

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that they are proud of, and that underlies growth. China is really

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the major official investor in Cambodia now. They have helped to

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build a network of roads, the power generation grid. That has been

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positive for the country. Cambodia made the right choice there. The

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question now is what kind of factors or they put next to those Chinese

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roads? -- factories. What products with a specialising? Hour they take

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that next step in development? American and European investors are

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important in that. That was the US ambassador to Cambodia. Japan has

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sought to reassure investors it is willing to intervene in the currency

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market. The move follows a recent pledge by the G20 nations to consult

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on foreign exchange markets as well as avoid competitive currency

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devaluation. The yen has gained more than 10% against the dollar this

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year, which worries the government. It increases export earnings and

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effect low inflation. The biggest gas discoveries in the North Sea are

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being built right here in Singapore. It is a project worth $4.5 billion,

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and the Danish firm was given the UK government approval last year. As

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our Scotland correspondent reports, some people are asking why the

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platforms are being built in Asia instead of the UK.

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It is a tradition in Singapore for a line dance to wish a project well.

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The gasfield in the North Sea is a boost for Singapore, but has left

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fabricators in Britain upset. The cutting of the first steel for a

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deal with thousands of jobs. But for the high-pressure wells involved,

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the company says the work had to go overseas. This is specialised

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construction, and something like this in Singapore is specialised and

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have the capacity and expertise to do this project. We could not really

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finite capacity and expertise unfortunately in the UK. -- find

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that capacity. It may be the first steel, but the project is ready well

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under way. In a yard across the island, this early construction

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project is nearing completion. In the next few months, this drilling

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rig will begin the 7000 mile journey to the North Sea. It will take about

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45 days to get there, but it is expected to be on site by the end of

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this year. The company says some of the work is being carried out in the

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UK. The development will produce 400 direct jobs and support 6000 more.

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There has been quite a bit of discontent that a lot of the work

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was placed outside the UK. That is among UK fabricators. They have not

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been happy about the situation. Especially in light of the fact that

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they have been given tax assistance by the UK government. Noted

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touring. This would have provided much-needed engineering jobs in the

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UK, but the company says in the long-term it will be worth billions

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to the Exchequer. -- no point tiptoeing.

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You may have heard about the biggest e-commerce businesses, but have you

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heard of their rival? Freycinet it has become the first Indian

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e-commerce firm ever to list its shares on the stock exchange. While

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it is an industry that has attracted billions of dollars from private

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investors, firms are struggling to make money. More from Mumbai.

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Congratulations! The first day of trading for shares in cigarette.

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This is the first test of faith investors have -- Infibeam. Most of

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any's e-commerce firms are fast with private investors. Some are

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considering tapping the stock markets to help finds their

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expansion. The decision will be made partly on how well Infibeam's shares

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do, and that is why many are calling this public listing as a moment of

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truth for the industry. Last year, India's e-commerce firms attracted

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more than $5 billion of private money. But they are burning to that

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cash, offering hefty discount tried to grab market share. The three

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biggest players lost about $750 million last year. Is this about a

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change? Last month the government announced tabs on the sort of

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discount online sellers can offer. -- caps. If you were making money

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offering discounts, it was incurring a loss. Now when these companies are

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not in a position to offer good discounts, to that extent, there is

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no dent in profitability. It means the profit margins will go up. By

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2020, it is expected Indian 's will spend $100 billion online as

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Internet access, especially through smartphones, grows. Little wonder

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global players like Ali Barber have more of a dent. But firms that do

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not start focusing on profits may be forced to pack up operations in this

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highly competitive market. Let's take a quick look at the

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markets. Japan's Nikkei has opened two losses, down over 1%. This is

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due to the strength of the Japanese yen. We told you about that earlier,

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the government trying to talk down the strength of the yen but not

:10:15.:10:17.

really succeeding. We also had machinery data out of Japan showing

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a fall of the study markets despite the rallying of Will prices and

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resource stocks on Friday. -- oil prices. The prices they are

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currently flat. And that is how the US close on Friday. That is it for

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this edition of Asia Business Report.

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