Browse content similar to 06/09/2016. 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 | :00:00. | :00:00. | |
Next up, Laos, the flats are ready but tough talk awaits President | :00:00. | :00:19. | |
Obama at the meeting of south-east Asian leaders. And striking gold | :00:20. | :00:28. | |
with cocoa, we meet a postman who quit to pursue life as a farmer. | :00:29. | :00:41. | |
Good morning Asia, hello world, I am glad you can join us for this | :00:42. | :00:50. | |
addition -- edition of Asia Business Report. President Obama heads to | :00:51. | :00:53. | |
Laos to meet south-east Asian leaders for the last time before he | :00:54. | :00:58. | |
leaves office. At home he is trying to sell the TPP to Congress, the 12 | :00:59. | :01:02. | |
nation free trade pact which has been agreed but has not been given | :01:03. | :01:06. | |
the final sign off, and Americans are indeed divided. The Pew research | :01:07. | :01:14. | |
centre reports 47 of all registered voters say free trade agreements | :01:15. | :01:18. | |
like the TPP are bad for the US, while 45% say they are for the pact. | :01:19. | :01:22. | |
Candidates for the presidential election don't agree on much, but | :01:23. | :01:30. | |
both are against the TDP. In Asia the TPP is not the only trade deal | :01:31. | :01:35. | |
in town. Our correspondent reports on the options. TPP, ASEAN, GDP, so | :01:36. | :01:45. | |
many acronyms, so many options. Let's start with the TPP, the | :01:46. | :01:51. | |
Trans-Pacific Partnership. It is a US backed trade club which 12 | :01:52. | :01:54. | |
Pacific Rim nations have signed up to, including Japan, Chile and Peru. | :01:55. | :02:02. | |
If it goes through it could be worth 40% of the global economy that is | :02:03. | :02:09. | |
massive. But, it is a big heart, the US Congress has to ratify it and the | :02:10. | :02:14. | |
US appears to be against it. And notice who is not in the TPP party, | :02:15. | :02:20. | |
China, the second largest economy, with its own trade deal on the trade | :02:21. | :02:28. | |
deal, the RECP, the regional brands of economic partnership. Here is how | :02:29. | :02:36. | |
it gets complicated, it includes ASEAN, the countries that have | :02:37. | :02:40. | |
signed FTAs, free trade agreements with ASEAN, and the PRC, the peoples | :02:41. | :02:48. | |
respond with China. If the RECP comes together it could make up 48% | :02:49. | :02:55. | |
of the global population and be worth 24% of global GDP -- People's | :02:56. | :03:00. | |
Republic of China. Who will end up with the biggest party? The US or | :03:01. | :03:05. | |
China? We get close to that as leaders sit down for the ASEAN | :03:06. | :03:10. | |
summit. The ASEAN summit comes on the heels of another leaders | :03:11. | :03:14. | |
meeting, the G20, with Chinese President Xi jinking opening the | :03:15. | :03:17. | |
meeting urging leaders to avoid empty talk. Did they succeed? We | :03:18. | :03:25. | |
speak to a member of the lowly institute on international policy, | :03:26. | :03:30. | |
he joined me earlier via webcam. I don't think we will be saying a lot | :03:31. | :03:39. | |
of claims come in that this G20 was more than a talk shop, because I | :03:40. | :03:44. | |
don't think economic lows will be addressed by leaders -- Lowy | :03:45. | :03:47. | |
Institute. Indeed, economic worries and issues, the slowdown in the | :03:48. | :03:51. | |
economy is what market watchers were looking out for in this meeting, if | :03:52. | :03:55. | |
there would be any fiscal monetary policy decisions, even to jumpstart | :03:56. | :04:02. | |
the global economy. Yes, yes, definitely. And one thing I think | :04:03. | :04:08. | |
which is quite symbolic of this is it appears that the communique was | :04:09. | :04:15. | |
actually drafted, the leader's statement was actually drafted and | :04:16. | :04:18. | |
finalised before they had even sat around the table. So, at this point, | :04:19. | :04:25. | |
how relevant is the G20? Is the organisation, in your view, | :04:26. | :04:28. | |
effective in trying to solve global issues? It is certainly making | :04:29. | :04:33. | |
progress in defined areas but it is clear, increasingly clear, in fact, | :04:34. | :04:37. | |
that these are a very small subset of areas. It is all about | :04:38. | :04:41. | |
cross-border economic governance. The real questions about whether or | :04:42. | :04:46. | |
not the G20 and government are able to get out of the low growth, high | :04:47. | :04:51. | |
unemployment, mounting risk, consistent and a result in a quality | :04:52. | :04:55. | |
scenario that we find ourselves in, that is an open question. Tristram | :04:56. | :05:00. | |
Sainsbury joining us earlier. Australian banks are among the best | :05:01. | :05:05. | |
performing in the world since the financial crisis with the big four | :05:06. | :05:10. | |
now facing allegations of rate reading and anti-competitive | :05:11. | :05:12. | |
behaviour and slowness in adapting to new technologies. So, are their | :05:13. | :05:18. | |
golden years over? Earlier, I spoke with Ben Pedley, director of | :05:19. | :05:24. | |
investments that you see a funds management. I think the Australian | :05:25. | :05:27. | |
banks have had it too good for too long and one of the problems is the | :05:28. | :05:32. | |
four pillars policy which helped the banks become strong and whether the | :05:33. | :05:36. | |
financial crisis is now a millstone around their necks. It is stifling | :05:37. | :05:42. | |
innovation. It is also encouraging complacency and anti-competitive | :05:43. | :05:45. | |
behaviour. And I think the latest example of that is of course this | :05:46. | :05:49. | |
rate reading scandal, which is referred to as the BBSW scandal, | :05:50. | :05:55. | |
similar to the LIBOR scandal. Is it time now for the government to get | :05:56. | :06:00. | |
rid of the four pillars policy? I think the answer is probably yes, | :06:01. | :06:04. | |
because I think the job it has done has been a very good one but it is | :06:05. | :06:08. | |
very much outdated, and I think the latest evidence of that is the fact | :06:09. | :06:14. | |
that, when Apple Pay came to Australia, the Australian banks said | :06:15. | :06:18. | |
to them as a whole, you deal with us or else we won't allow you in, the | :06:19. | :06:22. | |
and this is the value to respond to technological change and also | :06:23. | :06:25. | |
competition that I think will ultimately hurt the banks and | :06:26. | :06:28. | |
potentially hurt Australian consumers. So what will this mean if | :06:29. | :06:32. | |
they break down this four pillars policy, what will it mean for the | :06:33. | :06:38. | |
financial industry? It will give Australians more choice, which is | :06:39. | :06:42. | |
good, and therefore better pricing for consumers, and it might also | :06:43. | :06:46. | |
provide foreign banks more opportunities in Australia. One of | :06:47. | :06:49. | |
the problems for the Australian banks is that all of this change | :06:50. | :06:53. | |
occurs at a time when they have sought expansion overseas and failed | :06:54. | :07:00. | |
in places like the UK, for example. They have also failed spectacularly | :07:01. | :07:04. | |
in Asia. They have become inward looking. The Australian economy is | :07:05. | :07:08. | |
adjusting to the end of the mining boom, so it is hard to see where | :07:09. | :07:13. | |
they will get their profits. Is it possible we could see one of these | :07:14. | :07:16. | |
four pillars failing? I don't think failing is the issue but I think | :07:17. | :07:20. | |
that the earnings growth and the halcyon days they have seen for the | :07:21. | :07:25. | |
last couple of decades are well and truly behind us. Yes, they still | :07:26. | :07:28. | |
offer attractive dividends but if you are looking for growth, and that | :07:29. | :07:34. | |
expansion and earnings growth to continue in the medium term, we | :07:35. | :07:38. | |
think that is unlikely. And, as an ethical fund, we are will so saying | :07:39. | :07:44. | |
this behaviour should not be rewarded. Well, Asia is one of the | :07:45. | :07:52. | |
fastest growing consumers of chocolate with a market worth more | :07:53. | :07:58. | |
than $18 billion in 2019 -- we are saying. The Philippines produces | :07:59. | :08:01. | |
less than 1% of global supply of cocoa butter with the equatorial | :08:02. | :08:05. | |
climate it has perfect growing conditions and entrepreneurs want to | :08:06. | :08:10. | |
increase it tenfold in three years. We caught up with one farmer who is | :08:11. | :08:19. | |
cashing in. I am a retired government employee of the | :08:20. | :08:27. | |
Philippines. I decided to plant cocoa because I have six children | :08:28. | :08:33. | |
and, if we just rely on our salaries, my wife is a classroom | :08:34. | :08:39. | |
school teacher, I could not imagine how could I send these six children | :08:40. | :08:44. | |
to college. At the very beginning, it is really my passion to love | :08:45. | :08:49. | |
farming. During my off days and holidays I would go to my farm and | :08:50. | :08:57. | |
started planting cocoa little by little, 100 trees, 200 trees, the | :08:58. | :09:04. | |
only kind of tree that reduces fruit 24 months from planting. At the very | :09:05. | :09:07. | |
beginning when I started cocoa farming it was only about 20 pesos | :09:08. | :09:14. | |
per kilo and now it is quite high, 140- 150 pesos per kilo. I have a | :09:15. | :09:22. | |
better income from cocoa farming. It is more or less 50 times my salary. | :09:23. | :09:26. | |
And I am proud to say that I have even got one daughter who got into | :09:27. | :09:33. | |
medicine. Even I myself did not expect that this would happen to | :09:34. | :09:40. | |
myself. I have no experience before in cocoa farming. My father is not a | :09:41. | :09:46. | |
farmer and my mother is not a farmer. Many times I have failed but | :09:47. | :09:53. | |
if you fail you have to do something to overcome the failure. And that | :09:54. | :10:00. | |
was a former postman and now a very successful cocoa farmer in the | :10:01. | :10:07. | |
Philippines. Before we go, a quick look at the markets. This is where | :10:08. | :10:11. | |
they are at the moment, lacklustre, moving sideways, because US markets | :10:12. | :10:15. | |
were closed overnight due to a public holiday, so not a lot of | :10:16. | :10:20. | |
liquidity in the Asia-Pacific markets today. The Nikkei is up | :10:21. | :10:26. | |
slightly but the all ordinaries down by 16 points. Thank you so much for | :10:27. | :10:31. | |
spending your time with us, I'm Rico Hizon. Sport Today is coming up | :10:32. | :10:38. | |
next. You are watching BBC News. | :10:39. | :10:41. |