05/10/2016 Asia Business Report

James stands down three weeks after election. She says she was going for

personal and professional reasons. Now on BBC News, the business news

with Rico Hizon in Singapore. Caught spying? Internet company Yahoo

scanned mail accounts at the request of the American government. Cheap

steel to fake handbags, China fights charges of unfair trading practices.

Good morning, Asia. Hello, world. Welcome to Asia Business Report. We

begin with Yahoo, in the spotlight with reports it has built a custom

programme to search incoming e-mails of its customers. Reuters claims the

search for this information was executed at the request of the US

intelligence officials. I spoke earlier with Dave Lee from San

Francisco. This report quotes unnamed former Yahoo employees which

suggests it was looking at incoming e-mail from its e-mail users for

certain strings of characters and certain phrases and words that might

be of interest to the US intelligence service. We've not been

able to confirm this and Yahoo say they are a law abiding company

complying with US laws, so not confirming things either. We are

waiting for some of the crucial detail about this set up, if indeed

it was taking place and precisely what information Yahoo might have

been gathering. It is another, as you have mentioned, controversial

moment for Yahoo which, as we know, was recently sold. Another dramatic

day in the history of a company that was once the most popular on the

Internet but is now fading out. They were just acquired, this comes less

than two weeks after the Internet company said hackers have stolen the

date of some half a billion users. Yes, that was the bad news they had

recently -- data. It happened as far back as 2014 and affected half a

billion users. This will add to their woe. I spoke with Horizon, who

is planning to buy Yahoo for $4.8 billion and they have refused to

comment on these reports. When it comes to the hacking, they said they

are considering their interest. It is dramatic timing for Yahoo. That

deal is yet to be finalised. As it stands, neither company are being

drawn on whether that will affect that huge sale. So, briefly, is

there the possibility that Horizon will back out from this deal? There

is the possibility, although it is worth stating that they have made no

hint that it is something they would consider doing. And until we have

clear information about what Yahoo have perhaps done, it is premature

to make suggestions such as that, simply because many US technology

companies, as we know from the Edward Snowden leaks were in some

ways complicit with the US government. So the question is how

much Yahoo helped with the US intelligence services. Our

correspondent at Yahoo in San Francisco. China's efforts to

control the debt problem are important to the future of global

growth, the message from the IMF, which has released world economic

outlook details just days after the fund introduced the yuan to the

basket of reserve currencies. My colleague caught up with the IMF's

chief economist. The decision that the fund made, which came into

effect a few days ago on the SDR symbolises the remarkable

achievement of China and the Chinese people in building an economy which

is, you know, of any single economy the biggest contributor to global

growth, which is even more important in global trade, and whose currency

is increasingly used worldwide. Of course, if not where the euro is, it

is not where the yen is, but that will come as China further opens up

its financial markets down the road, as it embraces a more flexible

exchange rate regime and as it continues to reform. Your forecast,

your economic forecast for the country is rosy. What problems is it

masking? I am thinking about, is it hiding a looming debt crisis? Debt

crisis might be an overstatement but it is certainly true that we view

the current near-term stability as perhaps being purchased by longer

term risks. There is too much credit growth, too much of that is

supporting sunset sectors with excess capacity, the problem of

imposing hard budget constraints on state-owned enterprises has not been

addressed energetically and. China has really reformed remarkably and

made remarkable progress in rebalancing the economy but the

current on target growth is, I think, somewhat deceptive in terms

of what could be sustainable in the long run -- energetically enough.

That was the IMF chief economist speaking with our correspondent. We

are looking at trade this week and the impact around the world. China

relies heavily on exports to sustain economic growth but has been accused

of unfair trading practices, including flooding the market with

cheap steel and fake handbags. US rates have told the BBC China is not

a level playing field for foreign companies. -- US representatives.

Robin Brant from Shanghai. China started opening up its economy

almost 40 years ago. Robots do much of the work now. Joint ventures like

this between the UK's Jaguar Land Rover and china's Chirai are the

only. Germany has called it coerced technology transfer. -- china's. How

is it for foreigners who don't have a billion to invest? People like New

Zealander Justin had been able to set up here on their own since China

joined the WTO in 2001. You will see the authorities more often. They

will be interested in what you are doing more often. They are always

generally very friendly and helpful to deal with but they are quite keen

to apply at all the rules, and if there is a fine you for some kind of

non-compliance, they are definitely very keen to apply that fine.

Whereas, for my locally invested business, we really don't see the

authorities very much at all. Opening up to the world has helped

make China a richer country but much of the economy remains closed to

foreigners. Some of the biggest names that have excelled here still

face one serious problem. Watchers? -- Watches? This is exactly the type

of thing that drives Apple, Gucci, very mad. Fake goods are ubiquitous.

Protecting intellectual poverty, clamping down on copiers is a

challenge in China. What is this? Some tech firms even keep their best

secrets out of the country, all of which makes trading in China

different to trading with China. Thousands of Indonesians queued up

to declare their assets last week as part of a new tax amnesty programme.

The initiative was deemed a success by its finance minister but critics

say the amount declared by wealthy Indonesians is just a fraction of

what the country needs. Our correspondent spoke with one of

Indonesia's richest men who explained why he decided to sign up.

Actually, our Cole family business is in Indonesia but it is registered

outside Indonesia -- whole. Now we go back. So this tax amnesty has

convinced you to return the ownership of a company to Indonesia?

It yeah, and then it will increase the taxpayer platform. And then let

everything goes and do that, say, normal system. Taxation platform

system. It is very good to the Indonesia economy. What makes you

confident that the same problems you experienced in the past, corrupt

government officials, asking for bribes from you, won't happen again?

I still believe that if we have good government, good president,

everything may be OK. For instance, 30 years ago, who believe that China

will become such as it is today? China today is Indonesia tomorrow. I

strongly believe that we are going to be the next giant in this area.

Mochtar Riady, one of Indonesia's richest man. Before we go, a look at

the markets. And as you can see, lacklustre for most regional areas

after US stocks retreated as the dollar rose to a two-month high on

upbeat economic data and a potential rate rise at the end of the year.

Thank you so much for joining us. I'm Rico Hizon. Sport Today is

coming up next. Hello, you're watching BBC News.

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