09/08/2016 Asia Business Report

Slower growth, disappointing trade numbers. We are waiting for the

latest inflation figures. We ask if china's economy is under pressure.

Dressed in press. A big fresh -- fashion retailer tells us why India

is attracting more foreign players. Welcome to Asia Business Report.

Glad you could join us. I'm Rico Hizon. We start off with China, with

the latest economic numbers and more evidence of slower growth. Today we

will find out how fast or slow the rising price has been. Trade figures

on Monday showed exports have fallen by nearly 4.5%, compared to one year

ago. Exports have fallen for 12 out of the past 13 months. Imports also

down by 12.5%. What can we take from these numbers? The base case going

into 2016, about china's economy continuing to muddle through,

remains in place. We have weak exports, but not much surprise.

Inflation is likely to ease. Having said that, consumers are still

chugging along. We have to be mindful of the outstanding debt and

within the private sector business isn't growing as strongly as we

would have liked. Looking at the exporter gives first, the general

consensus right now among economists is that Beijing will weaken the

currency to try to stimulate it. Is this the way forward? It is likely

it will seek some kind of stabilisation but not a dramatic

depreciation. If you appreciate the Chinese currency, Chinese consumers

lose pricing power. That's what they want, because the consumer is the

key driver of overall growth going forward. We also had the G20 summit

in Beijing in September. So it is unlikely we will see a dramatic

depreciation in the our MP. What about interest rate policies? --

RMB. Reserve requirements, we are likely to see a reduction because

the Chinese are still tackling money supply growth of 13% this year.

Actual cuts in interest rates are a little bit less likely than a cut in

triple R and that's because we are looking at inflation. When you look

at the second half of the year, from market perspective, you could in

fact the China playing catch up to the rest of the world. We are going

to have a delay in May and June because of heavy rain and also the

debt issue probably isn't as severe as investors think.

News Corp is one of the most powerful media companies in the

world, with publications like the Wall Street Journal. It has reported

a surprise jump in revenue thanks to strong growth. While digital music

is good and is growing, it is facing challenges, with News Corp shares

now trading in Sydney. There are two major platforms, one on the New York

stock exchange and one in Sydney. But not for -- much reaction,

despite the data? Yes, the trading of shares he had opened about half

an hour ago and I imagine investors will be pretty boosted by this

unexpected rise in revenue for News Corp. It certainly wasn't a story

earlier this year. Back in May the company reported a net loss of

almost 150 million dollars, so the turnaround has been quite

significant in a relatively short period of time. The company said in

a statement that it was on track to become more global and more digital

and if you drill down into the figures it is the digital side of

the News Corp business that is adding to this buoyancy. Revenue

from digital now makes up almost a quarter of the company's revenue, so

for a company founded and run by the Australian-born American vocal group

what Murdoch you expect the business to be resilient and ruthless. --

Rupert Murdoch. Perhaps that is what lies ahead of this resurgence in its

figures. Resurgence, especially in the digital platform, what it seems

like less people are reading the hard print. The tabloids and broad

streets -- broadsheets. So we are seeing a decline in its print

business? It is a tale of two sectors of this huge multinational.

On the one hand we have the digital business doing pretty well, on the

other side we have the newspaper which isn't doing so well. News Corp

owned titles like the Times and the Sunday Times in the UK, the Wall

Street Journal. In Australia it's a dominant player in the newspaper

sector. But revenue from advertising is falling. Rather ominously in a

statement the company did say that its Australian operation good expect

further savings in the months to come. Remember, this is a sector

that has had ongoing fears about cost-cutting for quite sometime.

Thank you so much for the update. A Brazilian playmaker is launching a

major programme to cut its workforce and reduce costs. -- plane maker.

Staff will be offered voluntary redundancies. The company expects

reduced demand for its executive jets this year.

Shares in GAP, and America's biggest clothing company, saw a drop in

sales of 2% in the three months to July, a bigger fall than analysts

expected. American clothing retailers have in struggling to draw

in shoppers, who prefer to buy clothes at cheaper, trendy fashion

stores. Over to India, where a market worth

$500 billion is expecting more foreign players. Swedish fashion

chain H was one of the first to enter the country after the

government decided to open its markets. We asked what potential

ahead of H sees in India. And the government was deciding to allow

100% FDI we were happy about that decision and decided to make our

application. This happened in February, 2014. Our expansion

strategy is to always open in the best locations in the countries, the

city, the more, were above. So we are not only looking at the big

shopping centres, we also look at smaller shopping centres. And there

we are only making the small stores, which corresponds to traffic in the

shopping centres. India isn't an easy market to operate in. Many have

come with local partners who can help. There are tax structures, or

perhaps just finding the right space. It is difficult. Did you find

it difficult? I don't feel it is complicated to operate here. We

respect India and the laws and we want to comply 100% of the laws that

are existing in this market. We started in this business in 1947,

when we opened the Birstall, and today we operate in 62 markets. --

opened the first store. So we have a great experience of going into the

first markets, together with our team in Stockholm. We don't feel it

has been difficult. One of the conditions of having stores in the

country is you need to source at least 30% locally. Is that really

doable? Many other brands have said this is complicated. We have been

sourcing for India -- from India for the past 30 years and we don't find

it difficult. In 30 years we have created great networks here and they

produce fantastic products for us. We are exporting them to all of the

other stores in the 62 markets. H has a huge presence online in China

and that's done really well for you. How come you aren't opening an

e-commerce business in India yet? We are focusing on the brick and mortar

stores at the moment. It is true that we have a great online store

that we operate in 23 markets. Of course online is important in India.

It is over a $2 billion business and is expected to $20 billion by 2020.

So of course we are looking to it, but there's no decision that we will

start that. Swedish fashion giant H

We are keeping an eye on the central bank meeting in Delhi today, one of

the last meetings for one of India's more outspoken central bankers. The

cost of borrowing is already at its lowest level in five years. If we

go, a quick look at the markets. Asia has reopened for trade. Most of

them are slightly in positive territory. This is due to stocks

sleeping overnight. The US dollar is rallying against the Japanese yen.

And there is also a rise in the price of oil. Thank you for

investing your time with us. I'm Rico Hizon. Sport Today is coming up

next.