02/11/2016 Asia Business Report

has said Britain must have the power to strike back

in kind against cyber attacks from abroad which aim

to target infrastructure such as power grids and air

Signing deals at a China air show. Confidence is skyhigh as playmakers

forecast massive expansion. And from boom to bust. Why the

economy is slowing. Good morning, Asia. Glad you could

join us for this Wednesday edition of Asia Business Report. Starting

with China's aviation industry and planes, pilots are going to be in

high demand in the mainland. The country set to become the biggest

aviation market in the next decade. In the last three years ten new

carriers have begun flying. They have bought at least 100 new jets,

made by foreign companies. But China has its own manufacturers as well,

including a commercial plane maker which forecasts China will need

700,000 jets over the next 20 years. Earlier I asked why it isn't in this

airshow. It looks like it is trying to get their C119 aircraft up in the

air. It was meant to make its first flight at the end of the year. We

are hearing it will be pushed to next year. So at the stage looks

like they are trying to keep a low profile and get that aircraft right

and get flying. That will be a big moment when it does but from what I

hear it isn't ready yet. Still a lot of missing parts before Comac

showcase is there a centrepiece aeroplane. But, taking a look at the

Chinese economy, it is indeed slowing down. But we're seeing so

many new players in the Chinese aviation market. Why isn't this

being reflected now? That's quite correct. The Chinese economy is

slowing, but air transport doesn't seem to have slowed by the same

degree and what we are talking about has been quite small. This market

has been growing just under 10% year-on-year for a number of years

and that is slowing to a round the-7%, was ugly 5%, Mark of the

next few years. But that's still quite a lot of people travelling. --

possibly 5%. That's why there are start-ups and why they continue to

need more planes. More than a dozen players now in the mainland aviation

industry. But eventually there could be a price war. Could this lead to a

consolidation or the closing down of some of these players going forward?

In the short term there is not too much pressure on these new players

going forward. There is still quite a lot of demand and it seems that as

soon as capacity comes into the Chinese market there's enough demand

to keep it going. Along the medium term we will see some consolidation

of players. The Chinese government of course that a lot of competition

between the big carriers. But if that policy changes I think we will

see a bit more consolidation around the big three state owned carriers,

as well as the likes of Heinemann airlines which has a number of

carriers. -- Hainan. South Korea's President Park Geun-hye has named

the U finance minister. The scandal is threatening to unseat her and

cost her chief of staff to resign. The Prime Minister and chairman will

be taking over the top finance role. Moving on to another rapidly

expanding Chinese sector, the world's largest e-commerce firm

Alibaba will later today likely post another quarter of solid growth for

the three months, ending September. Its financial arm online has

announced plans to expand beyond China, with a Thai payment company.

The opportunity we have is that there are 450 million consumers in

China who use our services. Many of them travel abroad every year.

Indeed, over 120 million travellers go outside the Chinese mainland

every year. So we want to serve those customers who are growing

abroad. We also see an opportunity to extend our reach to customers in

different markets around the world. What is the relationship between

Alibaba and Ant? Ant started as the payment system on the Alibaba

platforms. Our company was built through that partnership and indeed

it's a close relationship today, where we provide payments and other

financial services connected with the Alibaba e-commerce platforms.

But over the years we have expanded much more broadly beyond that. Too

many different merchants both online and off-line and we've expanded the

range of services we offer much beyond payment. Fairly or unfairly

there's quite a bit of suspicion sometimes of Chinese companies,

especially when lots of data is being generated. There is a worry

about who will get hold of that later. Will the Chinese government

be able to get hold of it? Our use of data is really driven by what

they need to accomplish what they are looking to do in buying things

and looking for different services and completion what they want in

day-to-day transactions. The card that data carefully for them and

protect the privacy of that. -- we guide. That's central to the way our

businesses are set up and our business capabilities. That's part

of our core strategy. Square, the mobile payment company, saw its

losses narrowing in the third quarter. The co-founder and Twitter

chief says it turns any mobile phone into a payment terminal.

Solar City will add more than $500,000 to its cash balance sheet.

Tesla revealed in September that four lawsuits have been filed,

looking to block this move. Shareholders of both companies are

looking to vote on the alliance later this month. Japan's biggest

pharmaceutical company is set to be in talks to buy the US drug company.

According to reports the deal could be worth about $10 billion. The US

company is owned by the parent company that is looking to light in

its debt burden. Resource rich Mongolia used to be

the world's fastest growing economy. Five years ago the nation boasted

growth of 17.5%. But this year growth of less than 1% is forecast.

As a result, its finances have become so bad the country to seek a

bailout programme from the IMF. This report from the capital.

This man moved here ten years ago, hoping for a better life. He is an

electrician by trade but with jobs scarce he has been paid as a car

park attempted. -- attendant. He lives without running water or

central heating. As the freezing winter approaches, he says coal

prices will go up and after the currency plummeted earlier this year

food items already cost more as they are mainly imported. TRANSLATION: We

can feel the crisis. Groceries and day-to-day basics are getting more

expensive, but somehow our salaries just stay the same. He arrived with

his wife and three daughters during the mining boom led by neighbouring

China, where most of Mongolia's commodities go, but it's a different

picture now. This man who runs a construction company lost $260,000

this year after the currency fell by 12%. Now many of his clients aren't

paying up. TRANSLATION: This is the paper with a list of clients who

only money. $3 million in total. Plus the workers get loans from

foreign Westerners with foreign currency, which means they can't pay

us back. In just five years Mongolia has gone from doom to bust. -- boom.

An unpredictable approach to investment policy, along with

disputes with key foreign investors, has seen money coming into the

country all but dry up. Meanwhile, an economic slowdown in China has

caused a drop in demand for Mongolia's commodities. The recently

elected government is now seeking assistance from the IMF. We have to

take actions to cut down expenses where necessary. We need to move to

bigger projects to increase the budgetary revenue and to ensure that

politically we have the will to support this. With her party now

holding the vast majority of seats in Parliament, the minister says

long stalled projects, including a railway from a mine in the Gobi

desert to China, should push ahead. At 4D is projects to get back on

track the government needs funding. It needs to bring back all the

investors and may be called the new ones to help fix the economy.

Perhaps then this man can achieve the life you wanted for himself and

his family. -- life he wanted. And with that we

end this edition of Asia Business Report. Thanks for investing your

time with us and goodbye for