:00:00. > :00:00.European Parliament in Strasbourg following a confrontation with one
:00:00. > :00:00.of his colleagues. Now on BBC News, all the latest business news live
:00:00. > :00:19.from Rico in Singapore. Samsung Electronics is facing an
:00:20. > :00:25.explosive situation with its smart phones. Will its bottom line get
:00:26. > :00:29.burned? And Filipino President Rodrigo Duterte eight marks 100 days
:00:30. > :00:35.in office but his shock tactics may be scaring away investors.
:00:36. > :00:41.Welcome to this Friday edition of Asia Business Report.
:00:42. > :00:53.It is almost the weekend. We start off with Samsung Electronics and the
:00:54. > :00:56.conglomerate in South Korea has signalled a 5.5% increase in
:00:57. > :01:01.operating profit for the third quarter compared to year ago levels.
:01:02. > :01:04.The company will disclose full earnings results at the end of the
:01:05. > :01:08.month when it will also provide details on how various businesses
:01:09. > :01:16.performed in the three months until September. This, take a look at it,
:01:17. > :01:20.the Galaxy Note 7 was supposed to be Samsung's big hit to boost its
:01:21. > :01:25.bottom line but instead it's faulty batteries have resulted in a global
:01:26. > :01:29.recall. Earlier I spoke with tech analyst takes orders and asked if
:01:30. > :01:35.Samsung can recover from this massive recall. There will be some
:01:36. > :01:38.impact on the third quarter but I think more of the consequences will
:01:39. > :01:41.be felt in the fourth quarter even potentially after that. It is about
:01:42. > :01:45.2.5 million phones have been recall but I think the challenge is not
:01:46. > :01:49.everyone will hand them back. There is going to be someone with the
:01:50. > :01:53.contacts, with pictures of their grandchildren, they are not aware of
:01:54. > :01:57.the news and haven't handed it back. It won't have a sufficient impact on
:01:58. > :02:02.the earnings guidance but now there are calls for the company to be
:02:03. > :02:13.split two ways. Is this the way forward for Samsung? It is a huge
:02:14. > :02:18.company. It sits on a cash pile of $69 billion. Comparatively, Apple
:02:19. > :02:22.sits on $231 billion. In relation to that it is small fry but it is a
:02:23. > :02:30.big, hegemonic company. At its root is -- it is an entrepreneurial
:02:31. > :02:35.company, from fridges to smartphone, tablets, you cannot be the slow,
:02:36. > :02:39.clunking bureaucratic companies to do that. Taking a look at the share
:02:40. > :02:46.price on Thursday, it has reached a new record high. Well, of course you
:02:47. > :02:49.have one point there being the news about the proposal to split the
:02:50. > :02:55.company, but you also have the global recall and you also have a
:02:56. > :02:59.succession issue that may impact the structure of Samsung going forward.
:03:00. > :03:03.I'm not sure it will break up because of this. I think there are
:03:04. > :03:08.too many vested interests. You are right it is a sure company. If you
:03:09. > :03:12.look at the profitability, it is much lower than Apple. Samsung
:03:13. > :03:19.outsells phones to 21 in terms of but profitability Apple outstrips
:03:20. > :03:24.it. -- two to one. Samsung was trying to boost the profit margin
:03:25. > :03:28.with the Note 7. That has been a roadblock. Will Samsung recover from
:03:29. > :03:31.this global recall? It seems like they are making investment into
:03:32. > :03:38.artificial intelligence. The story that Note 7 will keep bubbling and
:03:39. > :03:42.popping for sometime to come. They are trying to diversify into
:03:43. > :03:48.innovative areas. They have invested in Viv, it is an AI company. I don't
:03:49. > :03:53.know if you saw Pixel from Google. It was Google assisted, artificial
:03:54. > :03:55.intelligence. You have Siri with Apple and they are trying to do
:03:56. > :04:05.something similar with their own AI construct. In other news:,
:04:06. > :04:09.Twitter shares losing 20% of their value overnight in the US markets on
:04:10. > :04:14.fears that the much anticipated sale of the company will draw minimal
:04:15. > :04:18.interest from potential buyers. Shares headed south on reports that
:04:19. > :04:23.neither Walt Disney nor Google will be making a bid for the social media
:04:24. > :04:28.company. Deutsche Bank will cut 1000 jobs in Germany in addition to the
:04:29. > :04:33.3000 job losses previously announced in June. The lender has been under
:04:34. > :04:37.intense pressure over the last few weeks in US authorities asked the
:04:38. > :04:42.bank to pay a final $14 billion US to settle an investigation into
:04:43. > :04:45.mortgage-backed securities. That was to help boost its finances. Deutsche
:04:46. > :04:46.Bank has been selling assets and promising cost cuts.
:04:47. > :04:53.Now to the Philippines, where President Duterte marks 100 days in
:04:54. > :05:00.office this weekend. He has made headlines for what is perceived to
:05:01. > :05:11.erratic behaviour including telling Barack Obama to go to hell. He has
:05:12. > :05:16.challenged the US and EU to end its eight. The stock market has taken a
:05:17. > :05:20.tumble -- aid. Earlier I spoke with the head of the European Chamber of
:05:21. > :05:23.Commerce in the Philippines and I asked him if Mr Duterte comments are
:05:24. > :05:33.interacting the European business community. Locally the situation
:05:34. > :05:39.seems to be contained but if you are at some of the local investors here,
:05:40. > :05:43.foreign investors here in the local market, they are hesitant to expand
:05:44. > :05:47.at this point in time. But no one has so far indicated they are going
:05:48. > :05:53.to pull out. I think the danger is more bringing in new investment. If
:05:54. > :05:59.you don't focus on Mr Duterte's statements and on his drug campaign,
:06:00. > :06:03.what is your assessment of his economic reform programmes in his
:06:04. > :06:08.first 100 days? So far we have to give him and his government, it is
:06:09. > :06:15.very good, because the ten point agenda that they worked out, even
:06:16. > :06:21.before he was nominated as President already, it covers a lot of issues
:06:22. > :06:25.that they have tackled there. All of the ministers have been working on
:06:26. > :06:30.the different resources and so far the feedback is positive that we
:06:31. > :06:39.will achieve what we have set out to get done. Mr Duterte has rated
:06:40. > :06:47.himself in the first 100 days six tenths, what about you, what is your
:06:48. > :06:51.rating of his first 100 days? -- six out of ten. On the economy I would
:06:52. > :06:57.say six out of ten makes a fair assessment. In other portions, like
:06:58. > :07:02.for instance traffic situation, foreign policy, I would certainly
:07:03. > :07:06.not give it a six out of ten. Because there is lots to be desired
:07:07. > :07:14.in those aspects. Is Mr Duterte at this point in communication with the
:07:15. > :07:18.ECCP? Is the open to dialogue to discuss what needs to be done to
:07:19. > :07:22.move the Philippine economy forward? He talked to all his secretaries of
:07:23. > :07:26.the different departments, especially trade, finance and
:07:27. > :07:30.whatnot, and as I said earlier we are very much on track with what we
:07:31. > :07:41.have set out to achieve within the 60 years of his presidency. The head
:07:42. > :07:46.of the World Bank, Doctor Jim Kim, says the UN target of poverty is at
:07:47. > :07:51.risk because of political backlash against global trade seen by many
:07:52. > :07:54.economistss as the fastest driver of growth and the quickest way to lift
:07:55. > :07:59.billions of people out of poverty. He spoke with our economics editor
:08:00. > :08:02.in Washington. We can build all the infrastructure we want and then we
:08:03. > :08:07.can increase trade among the emerging market countries. But at
:08:08. > :08:11.the end of the day of if global trade does not grow at a robust rate
:08:12. > :08:16.it will be difficult to reach those targets. We are going to work at it.
:08:17. > :08:20.We know that it is not just investing in infrastructure and the
:08:21. > :08:24.other sort of foundational elements of economic growth, you have to
:08:25. > :08:27.invest in people, you have to have better social protection programmes
:08:28. > :08:33.and better health programmes, so we will do all that. But if the
:08:34. > :08:37.developed countries all close their borders it will be difficult, and it
:08:38. > :08:41.will be difficult for those countries as well. Is that it will
:08:42. > :08:45.be difficult, if there is a closing of boarders do you fear we may miss
:08:46. > :08:49.those targets? We very well could, absolutely -- borders. Any of us who
:08:50. > :08:53.have watched this up close, how important trade is for everybody, we
:08:54. > :08:58.have not done a good enough job of telling that story to people in high
:08:59. > :09:02.income countries. That was the president of the World Bank. With
:09:03. > :09:08.the Paris global agreement on climate change to take effect next
:09:09. > :09:12.month, the focus is on the airline industry. For the last 25 years of
:09:13. > :09:17.the UN has tried and failed to get airlines to limit carbon emissions
:09:18. > :09:22.but now the UN's aviation body, the ICAO, which sets global industry
:09:23. > :10:19.rules, has endorsed a scheme to cut emissions. Here is how it works.
:10:20. > :10:24.And finally, as you can see right now on the market boards, Asian
:10:25. > :10:28.stock markets trading cautiously ahead of a key US employment report
:10:29. > :10:32.to be released later today. Thank you so much for investing your time
:10:33. > :10:39.with us. I am Rico Hizon. Sport Today is up next.
:10:40. > :10:45.Before Sport Today, let's catch up with some of the headlines. Two days
:10:46. > :10:49.after it was struck by Hurricane Matthew a picture is emerging of the
:10:50. > :10:53.devastation on the south-western Tennessee off Haiti with 250 people
:10:54. > :10:54.now dead -- south-western