29/09/2016 Asia Business Report

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

A revamp in strategy. Blackberry is hanging up on its production of its

own smart phones. And a market debut in Mumbai later for India's

insurance industry. Good morning, Asia, and hello,

world. It's Thursday. Glad you could join us. I'm Rico Hizon. Smart phone

maker BlackBerry has maybe call. The company will outsource its direction

of smart phones to shift focus to its more lucrative software

business. Indonesia is the largest handset market for the company and

they have struck a deal to Manufacturer and distribute new

devices there. It is working on similar deals in China and India.

The announcement comes as the company reported earnings which

missed market expectations. Earlier, I caught up with out North America

technology reporter and asked him about BlackBerry's outsourcing

strategy. Around a year ago, the CEO of BlackBerry said quite openly that

it was not going to start making money from its my friends, they will

stop making them. -- smartphones. That is what they discovered. There

were not making money so they had to outsource the design as you

mentioned. They will still be BlackBerry branded phones, just not

made by the company any more. It is a far cry from the day when

BlackBerry was the leading force in smartphones. Unfortunately they have

not been able to keep their customers and change their product

enough, and companies like Apple and Samsung have taken away almost all

of their business. BlackBerry was the 1% of the smart phone market. By

outsourcing the production of this my friends, this will definitely

streamline the fact within the corporate structure of BlackBerry --

smartphones. What will this mean for the bottom line for the company now?

John Chen said he was hoping that by moving to this model they would

finally make these devices profitable. Even if they do become

profitable, this will not be a major revenue stream for the company

again. They are shifting their strategy to software. Despite the

fact their devices have not done too well, BlackBerry have always

maintained very secure software. Very hard to crack. That is

something they can build their business around more. They have been

doing that for the past three years and it is now being solidified with

this announcement that they will stop making their own devices. The

end of an era of making those iconic phones, but instead now it is all

about the software. According South Korea has complied with requests to

arrest a CEO. Prosecutors made the request earlier this week, and that

is on suspicion of investment and breach of trust for activities

involving $150 million. It is a conglomerate with businesses ranging

from retail, hotels, to chemicals. American retail giant Walmart is

reportedly in negotiations for a majority stake in the card, India's

largest e-commerce company. Walmart could be looking to invest up to $1

billion in flip card as it tries to get a slice of India's fast-growing

online retail market. One might currently operates wholesale stores

in India. -- Walmart. The largest share sale will debut on the Bombay

stock exchange in several hours. It hopes to raise more than nine Haji

Iman in US dollars. It is the first insurance company to go public in

the company -- $900 million. From Mumbai, our correspondent has the

details. With 1.2 billion people, India is the world's most second

most populous nation and one of the fastest-growing economies. Incomes

are growing as well as the financial awareness. Despite that, Indians are

not choosing to protect their assets by buying into insurance. More than

320 million Indians are estimated to hold some form of life insurance.

Given the country's large population, that means a huge

section, 70% of Indians, are not insured. Companies like these, the

first insurer to go public in India, are more than willing to fill that

gap. There is faith in systems security in this country. Research

done recently estimated about $8.5 trillion, which is very large. It

does give us a huge amount of confidence that there is enough

motivation for that in this country. That growth is expected to be driven

by India's emerging middle class, a section of society that are saving

more and living longer as well. But there are still millions of people

like these who said we can't afford insurance.

TRANSLATION: I can't afford to buy insurance. As my whole salary goes

towards supporting my family. The cost of living is so high I have no

savings. The government should provide insurance for free to all of

those who can't afford it. Affordability is a major barrier.

But there are other issues as well. Many people in India like awareness

about what policies can offer them. When you have customers who often

keep complaining that the claims process is bureaucratic and

complicated. The real challenge will be reaching and persuading the

majority of India's population to buy insurance, especially in rural

areas where around two thirds of the population live. The insurance

industry is estimated to be worth $70 billion today. But experts say I

could quadruple over the next decade. If insurers are able to

achieve success in rural India, the entire sector might see that kind of

growth -- it could could dribble. Volkswagen is struggling to draw a

line under the worst scandal in its 7080 history after admitting cheat

technology in its diesel cars in the United States -- 78 year history.

The crisis wideout gleams of euros from its shares, and rocked the

global auto industry -- wiped out millions of viewers. We caught up

with the Chief Executive at the Paris motor show. Look at this crowd

of journalists coming to see the unveiling of Volkswagen's new car,

an electric car. This is a fresh start from Volkswagen, because it is

one year since the diesel emissions scandal that caused the company

salmon problems. How much progress has made since then in sorting

itself out? -- so many problems. Let's ask the boss.

TRANSLATION: Undoubtably, this company made a huge mistake. We lost

the trust of authorities and our customers. We are in the process of

clearing up and resolving this crisis. We are making good progress.

We are working with the authorities in Germany and Europe and especially

the United States. It is very constructive. As far as the United

States is concerned, I hope that we are going to get a result from the

Department of Justice this year so we have a sound planning basis going

forward, especially regarding the find we may have to pay so we can

look ahead. -- finds. The investigations are going to show

what the root causes were, and in the meantime, we have revised our

business processes. It remains to be seen who was involved. That was the

Volkswagen Chief Executive. The European Commission is planning to

open an in-depth investigation into the planned merger of the London

stock exchange and Germany's torture. The $21 billion merger

would create your's largest exchange operator -- Europe. The watchdog

says the merger could eliminate competition in certain architecting

activities. The deal to marry the two world's brewing companies is set

to go ahead. Shareholders of both companies have approved the deal.

The $100 million marriage is expected to be completed over the

next few weeks. Being a matched group will produce almost one third

of the world's beer. Janet Yellen, the chair of the US Federal Reserve

believes the US economy could be ready for a rate hike by the end of

this year. This is what she said. Many of my colleagues indicated in

their recent projections the majority would see it as appropriate

to make a move to take a step in that direction. This year, if things

continue on the current path, and note significant new risks arise.

The comments were made during her appearance before the house

financial services committee. The US central bank had its meeting on

interest rates last week, where a majority of officials indicated that

it would be the appropriate time to raise rates before the end of the

year. These comments by Janet Yellen could definitely have an impact on

the financial markets in the near-term. But for now, what we are

seeing is Asia is getting an energy boost this Thursday due to a rise in

crude prices. Thank you for watching. I'm Rico