21/10/2016 Asia Business Report

calls for the former owner of Rajesh home stores, Sir Philip Green, to be

stripped of his knighthood. -- British home stores.

Goodbye America, hello China. Philippine President Duterte science

billions in deals despite their territorial tensions. Ready for

action. Taiwanese start-ups are getting a professional makeover.

Hello and welcome to Asia Business Report, I am Sharanjit Leyl.

Philippine President Roderigo Duterte has been on a charm

offensive this week in China. The two countries are involved in a

bitter territorial dispute over islands in the South China Sea, but

they have decided to focus on closer economic ties. President Duterte and

Xi Jinping sign deals worth $13.5 billion and during his trip Mr

Duterte also controversially said it is time to say goodbye to America.

And he has gone further, declaring his separation from the US, the

Philippines' long-standing ally. The US has demanded an explanation and I

spoke to an Asia analyst for a consultancy firm who explained what

Mr Duterte is trying to achieve. I think actually, while Duterte has

really spearheaded this economic focus in relations, the rest of the

public and also the broader political elite and the military as

well, which maintains very close relations with the US, is not 100%

sure that primarily economics should be tabled with China and there is

definitely some concern amongst broader government and the public,

that there needs to be a balance between ensuring that the

Philippines can reap the economic rewards that other countries in the

region have, but also that they are not selling out their own strategic

interests and their sovereignty claims for what may in the end the

soft loans and economic commitments that bring less tangible benefit.

Let's take a look at those sovereignty claims, because the

South China Sea dispute has been skirted around, they haven't

expressly referred to in this trip which is really interesting.

Obviously the Philippines warned the arbitration case at The Hague

against China just three months ago. How are they going to handle that

going forward? I think there is in many ways a huge amount of

discomfort in the Philippines that effectively they were handed one of

the strongest hands that they could have been through that tribunal

ruling, and not only has Duterte potentially overplayed at what he

has handed it to China. So they are effectively somewhat out of moves.

China is going to take more tentative steps with anything in the

South China Sea, I think it will pursue its own charm offensive in

terms of the Philippines but for now I think Duterte has made it very

clear that the South China Sea is something that is not going to be a

key point of focus. Whether that works out well in the future is yet

to be seen but for now I think there will be a lot of soft-pedalling for

both sides. In other business news, safety regulators have confirmed the

11th death in the US involving airbags. 60 deaths have been linked

to the faulty airbags, which have prompted a worldwide recall of 100

million in the letters, the biggest in the auto industry's history. In

the latest incident, a 50-year-old woman died after she crashed her

Honda Civic which was recalled eight years ago but never repaid. Bad

weather and drought have dragged on Vietnam's economy, taking its toll

on agriculture and imports as well as exports. The government is

expecting Vietnam's rapid economic growth to slow this year and that is

likely to put more pressure on the levels of public debt. Our reporter

spoke to the managing director of one of Vietnam's major private

equity firms. There is a misunderstanding here in terms of

public debt. A lot of the public debt is domestic debt so when they

talk about public debt they tend to feel that Vietnam owes other nations

outside the country US dollar debt but that is not true. Most of the

60% debt is domestic debt so it is not subject to the effect of

volatility or risk, if you well. In 1997 a lot of the Asean countries

got into trouble, and that has to do with the money they owe abroad in US

dollar terms. Vietnam it is probably not the case at the moment, most of

the debt is domestic government bond issuance, issued to support the

fiscal deficit that Vietnam is in right now, that is the concern they

have to address at the moment. Vietnam also has one of the world's

fastest ageing population is so given that multinationals are

attracted to Vietnam for its manufacturing base and large young

population at the moment, what is going to do down the line? It is

rapidly going that way, as you mentioned. But the population who

are young, under the age of 30, are still quite large, over 50%. They

are growing in wealth, they are creating wealth. The key is, when

they create the wealth are they putting money aside so that when

they retire they have sufficient funds to live off. And so yes, we

agree that the population is ageing quickly, but it has a long ways to

go and during that period of time will be great wealth being created

in Vietnam. In other business news, US communications giant Verizon may

renegotiate a deal to buy Yahoo. The original deal was worth $4.8 billion

and was expected to drive advertising and media growth.

Verizon's shares slipped 3% after it posted third-quarter results showing

it had added just half the subscribers of analysts expected and

shares in Microsoft have hit an all-time high after sales in its

cloud business soared in the third quarter. The shift away from

hardware towards cloud services seems to have paid off. It eclipsed

market expectations. Nintendo shares have plunged 5% after it unveiled

its next games machine, a hand-held portable device called Switch. One

analyst said the new hardware could be Nintendo's last shot at selling

home consoles. It is aimed at winning back consumers but it seems

investors are disappointed. Our technology correspondent explains

what is at stake. Nintendo has done well in its hand-held devices, in

the top five bestselling consoles of all time, two of them are handhelds.

It is trying to capture some of that market because its most recent home

console, the kind you put under the television, the Wii U, did not do

well. You can use this on the TV as well, so two in one. The Wii U,

people thought it could do that and it was teased that it could do that

you couldn't. It would only work in the home, you couldn't take the

controller out and about with you. So it had a muddled message.

Hopefully this will be a lot clearer. Billions of dollars are

raised worldwide every through crowd funding, which is mostly for small

business ventures. Over here in Asia where the concept is relatively new,

some $1 billion has been raised in the last two years. In Taiwan a new

company is helping fellow entrepreneurs raised millions for

their ideas. We met a boss of the company to find out more about his

start-up success. TRANSLATION: A set up this company

because I saw a lot of people had good ideas and products, but they

were not getting attention from funders. I did some research and I

realised there was a demand for a company like ours to help them

prepare for crowd funding. And it was especially needed in countries

where crowd funding was just developing. Many Taiwanese people

want to be entrepreneurs, because they strongly feel Taiwan should

have its own brands. New entrepreneurs have a lot of

difficulty finding investors. They have two first prove their product

is good. First we talked to the budding entrepreneurs about whether

their product or idea is worth pursuing. We suggest any needed

changes. Then we help them run a publicity campaign, including

filming video, taking photographs, or making advertisements.

To be frank, many people who want to use crowd funding to raise money

don't know what to do with their lives. They just want to give the

idea a try. At out of 100 cases, only about 40 or fewer succeed. The

ones who succeed naturally have collected a lot of experience in the

field they are in. They are people who really want to solve problems

they see around them. Let's take a look at the markets. The Nikkei

seems to be extending on its success, up at six-month highs,

extending on the six-month highs it closed at yesterday. It is up 0.2%

at the moment and that is despite the fact Nintendo shares have

fallen. Also flat markets elsewhere. That is it for this edition of Asia

Business Report. Thank you for watching. You are with BBC News.

Let's bring you up-to-date with our top stories. Washington wants an

exploration after the Philippines' president said he was separating

from the US in favour of China. And