:00:14. > :00:21.Strong as steel. Iron ore prices have hit 15 month highs. So will
:00:22. > :00:27.they last or will they rust? It's three years since the Raynor Plaza
:00:28. > :00:38.tragedy in Bangladesh. We find out if anything's changed in the garment
:00:39. > :00:41.industry. Hello and welcome to this Monday edition of Asia Business
:00:42. > :00:46.Report. Investors will be keeping a close eye on iron ore prices which
:00:47. > :00:49.have surged more than 50% since the beginning of the year after a
:00:50. > :00:55.protracted slump cracked down on prices from the highs of $200 a ton
:00:56. > :01:00.five years ago. It looks like command from China's steel industry
:01:01. > :01:04.is on the rise. Prices have been boosted by supply disruptions in
:01:05. > :01:10.Australia and Brazil. But will the rebound last? We found out from the
:01:11. > :01:16.industry. Recently the iron ore price has hit, as you mention, the
:01:17. > :01:22.15 month high against, about $70. I was in China last week and even the
:01:23. > :01:26.Chinese market is finding it fascinating in a way, most are
:01:27. > :01:31.saying it is hard to sustain because looking at China's steel demand as
:01:32. > :01:35.well as iron ore demand, it's not as good as last year. People here are
:01:36. > :01:40.very confused. At the same time, how come the prices have been rising?
:01:41. > :01:46.They are fascinated by this, speaking to your sources, and indeed
:01:47. > :01:50.a lot of iron ore producers, even the likes of BHP Billiton, think
:01:51. > :01:57.this surge in prices will last. Why is that? Nowadays we can see a
:01:58. > :02:01.closer coalition between iron or prices related to Chinese steel
:02:02. > :02:07.prices. We will be looking at the prices in the physical market. Last
:02:08. > :02:17.week, towards the end of last week, prices hit a new high as well. That
:02:18. > :02:22.led to the $70. We know China is a major steel producer, they want to
:02:23. > :02:27.curtail production, that doesn't bode well for the industry but at
:02:28. > :02:33.the moment you are seeing production disruptions, leading to rising
:02:34. > :02:36.prices. That's true. I would say the production disruptions stems from
:02:37. > :02:41.the steel side as well as the iron northside. You might think it is
:02:42. > :02:45.strange but at the same time, -- iron ore side. You are trying to
:02:46. > :02:50.curtail the production and that would be a boost to the prices as
:02:51. > :02:55.well from both sides. Where do you see prices heading? It's very hard
:02:56. > :03:00.to say but I would say this year the volatility will be more than last
:03:01. > :03:05.year. Anything could happen. Because we did see the $70 number. Because
:03:06. > :03:10.of the volatility it is hard to predict nowadays.
:03:11. > :03:17.Bangladesh has marked the third anniversary of the Rana Plaza
:03:18. > :03:22.disaster when a garment factory collapsed in 2013, killing more than
:03:23. > :03:26.1100. In the aftermath, the focus was trying to improve safety
:03:27. > :03:35.standards so that a tragedy like this wouldn't happen again. We found
:03:36. > :03:41.out how the industry has changed since then.
:03:42. > :03:48.Almost all of the exporting garment factories have gone through a
:03:49. > :03:56.standardised safety inspection, for building, structural integrity and
:03:57. > :03:59.the like. All of them have now got an inspection report indicating what
:04:00. > :04:04.changes need to be made to fix the safety issues.
:04:05. > :04:14.The standard that is applied here in Bangladesh is essentially based on
:04:15. > :04:17.Bangladesh National Building Core, but also following international
:04:18. > :04:22.good practices, it's a combination of best practices. We are hearing
:04:23. > :04:27.that the Bangladesh garment industry is heading towards a good standard.
:04:28. > :04:30.When the renovation is complete I think this will place Bangladesh in
:04:31. > :04:39.a very good place with competitive advantage. Safety has received a lot
:04:40. > :04:47.of attention in Bangladesh and it has seen improvements. But we also
:04:48. > :04:50.want to see more action with labour rights, making sure they are
:04:51. > :04:59.protected. We have seen a lot of workers in the last few years
:05:00. > :05:00.improving workers' rights as well as worker safety, that is a major
:05:01. > :05:09.priority for us. We have spoken to the president of
:05:10. > :05:13.the American Chambers of Commerce in Hong Kong. He travelled to the
:05:14. > :05:17.tragedy after it happened and since then he has been looking at the
:05:18. > :05:22.industry across the region and we found out if it had changed. The
:05:23. > :05:25.engagement by Bangladesh by international businesses, which has
:05:26. > :05:31.always been very strong, has intensified substantially imprecise
:05:32. > :05:38.areas where the tragedy gave rise to concern. Certainly on structural
:05:39. > :05:42.safety and training, safety training of all sorts, fire safety in
:05:43. > :05:47.particular, which has always been in place in the foreign investment
:05:48. > :05:51.factories. The Rana Plaza disaster made it very clear that of the 5000
:05:52. > :05:57.factories that are in the manufacturing of garments in
:05:58. > :06:01.Bangladesh, they all had to take a much closer look at the way they
:06:02. > :06:06.operate. You say things have changed but many critics said progress has
:06:07. > :06:12.been incredibly slow. The international coalition is set up
:06:13. > :06:15.after the disaster said a lot of the changes they have been trying to
:06:16. > :06:26.implement are well behind schedule. Why? That is an accurate observation
:06:27. > :06:33.first of all. A great number of factories have been investigated for
:06:34. > :06:38.structural safety but that takes extra time. That is not widespread
:06:39. > :06:40.to the international standards and hasn't been available in
:06:41. > :06:46.Bangladesh. There's a lot of training involved, which isn't a two
:06:47. > :06:48.weekend exercise obviously. Getting enough people to do the proper
:06:49. > :06:54.inspections and procedures is one thing. The other thing, foreign
:06:55. > :07:01.investor factories are less than half of that 5000, maybe 2000
:07:02. > :07:05.factories. Much more progress being made there even more than before.
:07:06. > :07:10.Then you need to train out and build out that explored these to the
:07:11. > :07:16.Bangladesh government manufacturing and exporters Association. That
:07:17. > :07:21.export. They have a wide range of expertise and they need a strong
:07:22. > :07:25.will to make changes -- export. It's a government issue, it is an
:07:26. > :07:27.institutional one as well as a company one.
:07:28. > :07:31.The Indian government has revoked the passport of the flamboyant
:07:32. > :07:37.businessman and lawmaker Vijay Mali. He fled abroad last month
:07:38. > :07:42.following pressure from Indian banks to repay $1.3 billion in debts owed
:07:43. > :07:47.by his failed company Kingfisher airlines. Some reports have traced
:07:48. > :07:52.him to the UK. India is now seeking legal advice on whether he can be
:07:53. > :07:59.extradited to face charges of money-laundering and financial
:08:00. > :08:06.irregularities. Some of the companies considered forbidden in
:08:07. > :08:10.Islamic finance where investors need to be Shariah compliant or meet a
:08:11. > :08:15.code of law found in the Koran. It's a growing industry but can it
:08:16. > :08:17.navigate investments that might fall into a grey area, like hotels. We
:08:18. > :08:25.found out. Welcome to the Holiday Inn Express
:08:26. > :08:29.in Singapore. To most it looks like just another hotel but its owner has
:08:30. > :08:34.used it in a landmark Islamic finance deal worth $260 million. I
:08:35. > :08:38.sat down with the bank are behind the transaction and asked how it is
:08:39. > :08:45.unique. When you talk about hotels and you think about the facilities
:08:46. > :08:52.that go with the hotel, they would serve pork and alcohol. That's a
:08:53. > :08:57.no-no in Islamic finance. In this case we were able to analyse whether
:08:58. > :09:05.the income stream which is the threshold in terms of share to the
:09:06. > :09:11.total income of the hotel. We were able to find out it is not. The
:09:12. > :09:16.Islamic finance industry is expected to be worth more than $3 trillion by
:09:17. > :09:21.2020. Saudi Arabia is the market leader, followed by Malaysia with
:09:22. > :09:25.Indonesia in seventh. But Islamic finance still only accounts for less
:09:26. > :09:29.than 1% of all global financial assets. So why the lack of
:09:30. > :09:40.appetite? I suppose because conventional banking is so sure. Why
:09:41. > :09:48.would you want to do something different? This transaction could be
:09:49. > :09:51.a good idea. The industry has yet to take off particularly in secular
:09:52. > :09:54.countries. But given this latest deal, hopefully there will be more
:09:55. > :09:58.opportunities for the industry to become mainstream.
:09:59. > :10:06.Let's look at the markets now because Japan's Nikkei is just a tad
:10:07. > :10:11.lower, this is due to profit-taking after we saw that four-day rally
:10:12. > :10:15.last week. Caution setting in ahead of the Bank of Japan's Central Bank
:10:16. > :10:20.meeting this week to decide policy. There was a suggestion they could
:10:21. > :10:25.inject more stimulus. Australia is shut for Anzac Day. Trade doesn't
:10:26. > :10:31.start again until tomorrow and the Hang Seng is open in a bit. That's
:10:32. > :10:33.it for this edition of Asia Business Report. Thanks for watching.