:00:16. > :00:25.To hike or not to hike? The spotlight is on the US central bank
:00:26. > :00:27.and its final meeting of 2016. Efforts to save Nissan from
:00:28. > :00:43.collapse. Can also save Mitsubishi? Good morning, Asia. Hello, world. It
:00:44. > :00:49.is Wednesday, glad you could join us. It is the meeting that markets
:00:50. > :00:54.have all been waiting for. The US central bank has kicked off its
:00:55. > :00:57.two-day meeting and the Federal Reserve is widely expected to raise
:00:58. > :01:01.interest rates for the first time this year. Our correspondence in
:01:02. > :01:03.Singapore and India explained how this decision will affect their
:01:04. > :01:07.economies. Here in Singapore and around
:01:08. > :01:11.Southeast Asia, expectations have been rising that the US will hike
:01:12. > :01:16.interest rates. That led to money flowing out of Asia and into the US
:01:17. > :01:20.dollar, which has resulted in sharp declines in Asian currencies. One of
:01:21. > :01:25.the worst affected is Malaysia. It has seen its currency fall to record
:01:26. > :01:29.lows in recent weeks. This is all coming at a time when many Asian
:01:30. > :01:33.companies have to start paying back their debts, much of that is in US
:01:34. > :01:37.dollars and it will be far more expensive to do that now than it has
:01:38. > :01:41.been in the past. Here in India the stock markets have
:01:42. > :01:47.been volatile ahead of the Fed's meeting. A rate hike in the US could
:01:48. > :01:50.lead to a cash floating India, with foreign investors selling off their
:01:51. > :01:58.stocks and equities. That could weaken the Indian rupee as well. But
:01:59. > :02:02.compared to other emerging markets, it is expected to be limited.
:02:03. > :02:04.Earlier I spoke to a market strategist in Sydney who explained
:02:05. > :02:08.how investors have been preparing for this highly anticipated rate
:02:09. > :02:12.rise. I think the market since the
:02:13. > :02:15.election of Donald Trump have moved materially. We've seen big cash
:02:16. > :02:20.outflows from the region and we've seen the currencies of the region,
:02:21. > :02:23.under pressure, so 25 basis points tomorrow morning is pretty much
:02:24. > :02:28.baked into the cake. Now we just wait to see what Janet Yellen says.
:02:29. > :02:32.What do you think will Janet Yellen and defence a in their statements?
:02:33. > :02:37.Do you think Donald Trump's election has affected their outlook west I
:02:38. > :02:43.think it probably has, but only at the margin. Charles Evans, in
:02:44. > :02:48.Chicago, last week said it was too early to tell what the impact of
:02:49. > :02:53.Trump would be. What Janet Yellen will do is ignore that the cautious
:02:54. > :02:57.that we've had in 2016, the Fed that really found an excuse not to hike
:02:58. > :03:03.every time it could, is still the dead that we will see next year. She
:03:04. > :03:07.doesn't want to split stock markets on wants the US dollar to materially
:03:08. > :03:12.strengthen, because that would hurt US trade, but I think she will
:03:13. > :03:20.signal potentially three or four moves in 2017. And that would lead
:03:21. > :03:25.to a stronger dollar. Is this good or bad for Asia? At the margin may
:03:26. > :03:30.think it is bad for Asia, because it means capital flows. The a certain
:03:31. > :03:34.extent it into the exports from the region are much more competitive, in
:03:35. > :03:37.a stronger dollar environment, but the problem with that is that in the
:03:38. > :03:41.meantime we have to deal with investors reallocating their money,
:03:42. > :03:45.not only away from the cash that they make on the sidelines but from
:03:46. > :03:50.all the money that's been flowing into Asia over the last couple of
:03:51. > :03:52.years. I think India is especially vulnerable, given where it is
:03:53. > :03:56.inflation is and what Narendra Modi's cash crunch will do to the
:03:57. > :04:01.economy. But I think regionally capital flight in the next few
:04:02. > :04:10.months will eventually give way to stronger economy is benefiting from
:04:11. > :04:22.US nominal offshore growth. Over to Japan and it's a big day at
:04:23. > :04:27.Mitsubishi motors. There will be a new chairman of the company. They
:04:28. > :04:29.will vote on whether or not to triple the annual pay packages of
:04:30. > :04:36.Mitsubishi motors at' top executives. Nissan bought a
:04:37. > :04:44.controlling stake earlier this year, leading to the new post. Can he turn
:04:45. > :04:50.the struggling automaker a round? I asked that question. The problem is
:04:51. > :04:53.that Mitsubishi, because of the scandal we have seen, they have an
:04:54. > :04:58.uphill climb and the other problem is that even before the scandal it
:04:59. > :05:05.was a bit of an ulcer in Japan. You have Nissan, to Gotye, Mitsubishi
:05:06. > :05:09.was before or fifth choice. In a way that Brand has been dented. --
:05:10. > :05:14.Toyota. Perhaps the chairman is the only person at this point you can
:05:15. > :05:18.rehabilitate it to be she, but it won't be an easy job. -- Mitsubishi.
:05:19. > :05:26.What should the strategy be to rehabilitate it? He is claimed off
:05:27. > :05:31.reapplying the Nissan handbook from 1999 to Mitsubishi. There will be
:05:32. > :05:37.talks today about adjustment in salary caps, but I think one of the
:05:38. > :05:43.most interesting thing is the way that he is trying to make Mitsubishi
:05:44. > :05:50.more of... He's trying to do away with the priority system, and look
:05:51. > :05:53.at executive pay based on performance, which is a novel idea
:05:54. > :05:58.in Japan. He will create what is calling a performance officer. In
:05:59. > :06:03.many ways this is what Japan needs more broadly. Abenomics is four
:06:04. > :06:08.years in and we haven't seen a lot of corporate reform, a lot of change
:06:09. > :06:11.from the corporate level. Here is you have Carlos Ghosn through
:06:12. > :06:14.Mitsubishi joined the rest of Japan what they should be doing in many
:06:15. > :06:19.ways to make Japan more competitive, to make companies more vibrant, and
:06:20. > :06:24.this is an interesting moment as 3017 approaches. even though
:06:25. > :06:26.Mitsubishi has been hit by this omission scandal, they still have
:06:27. > :06:31.their strengths, especially in markets like Southeast Asia, where
:06:32. > :06:37.Nissan is weak? In many ways they have strength externally.
:06:38. > :06:41.Domestically not so much, in many ways the Mitsubishi brand has taken
:06:42. > :06:45.a big hit in the last several months, just as Volkswagen has in
:06:46. > :06:50.the past year, and the question is whether Carlos Ghosn can shake up
:06:51. > :06:55.this corporate climate and that's really an open question. We will
:06:56. > :07:00.see. Singapore is one of the sunniest
:07:01. > :07:05.places in Asia, but space is hard to find and solar energy has been slow
:07:06. > :07:11.to catch on. Now the world's largest solar testbed has been set up, doing
:07:12. > :07:17.something never done before. Right near the equator, it is always
:07:18. > :07:23.some in Singapore. Yet less than 1% of the power is generated by the
:07:24. > :07:27.sun. The adoption of solar energy in Asia has been a bit slower than in
:07:28. > :07:34.Europe, so the market over their has been booming over the last 10- 15
:07:35. > :07:40.years. Most countries in Southeast Asia have to wait until the global
:07:41. > :07:45.market builds up the capacity and learns from economies of scale.
:07:46. > :07:50.Solar energy is cheaper now. China has become Asia's leading user of
:07:51. > :07:54.solar power. Japan is also a big adopter and India is pushing to be.
:07:55. > :07:59.Southeast Asia is slowly catching up, led by Thailand. Trouble is, in
:08:00. > :08:04.places like Singapore, there's not much land for installing solar
:08:05. > :08:09.panels, so scientists are looking for alternatives. Ten floating solar
:08:10. > :08:12.panel systems have been set up in this remote part of Singapore,
:08:13. > :08:18.divided by companies from all over the world. Each is designed
:08:19. > :08:22.differently. The way they float, for instance, to the type and size of
:08:23. > :08:26.the panels used, to the way the panels are arranged. The goal is to
:08:27. > :08:30.find out which one works the best. The more direct sunlight solar panel
:08:31. > :08:36.gets, the more it heats up. But the more it heats up, the less power it
:08:37. > :08:40.produces. So floating systems are being tested to see if they are more
:08:41. > :08:45.efficient. In a building environment like Singapore, which is a
:08:46. > :08:54.citystate, then you have a lot of heat from the buildings. If you go
:08:55. > :08:59.out to the waters, for example, that we are trying to test here, how much
:09:00. > :09:04.is the cooling effect from the water on the solar panels and how much
:09:05. > :09:10.more electricity can regenerate, compared to a system on the rooftop,
:09:11. > :09:13.for example? Experts say the region's governments need to stop
:09:14. > :09:17.subsidising conventional electricity and get incentives -- give
:09:18. > :09:24.incentives to companies wanting to harness the power of the sun.
:09:25. > :09:28.Solar power indeed. In other business news making headlines,
:09:29. > :09:35.Asahi shares are continuing to fall in early Tokyo trade, extending a 5%
:09:36. > :09:39.drop from yesterday when it announced it is having its biggest
:09:40. > :09:44.ever overseas deal. Well, Japan's largest grower is paying eight
:09:45. > :09:56.billion-dollar is for some of the beer brands as part of its expansion
:09:57. > :09:59.strategy. -- largest brewer. Basically Asahi shares mirrored the
:10:00. > :10:05.lacklustre mood in the Asian financial markets. Japan is down by
:10:06. > :10:13.27 points. The Hang Seng opening up 150. The All Ords up 40. People are
:10:14. > :10:17.waiting for the imported information from the US Federal Reserve, as to
:10:18. > :10:22.whether they will raise the cost of borrowing. No impact whatsoever on
:10:23. > :10:27.the Dow Jones industrial average. It was up, together with the NASDAQ, at
:10:28. > :10:40.a record high. Thanks for joining us. Goodbye for now.
:10:41. > :10:44.The top stories this hour: Aleppo has fallen to the Syrian government