04/01/2017 Asia Business Report

Welcome to Asia Business Report. US car manufacturer Ford cancelled

plans for a $1.6 billion plant in Mexico. That was in favour of

further investment at home. The CEO Mark Field says the policies of the

President-elect and his incoming Administration factored into the

decision. We look at a lot of factors when we look at decisions.

The announcements we are making today of $700 million in the flat

rock plant and adding 700 jobs, one factor we put into that is the

favourable US business environment that we see under the

President-elect and some of the growth policies and reforms, whether

it is tax or regulatory, that he is talking about, that played

positively in this and it is a vote of confidence that he can deliver.

The CEO of Ford motors. He says a more favourable US environment was a

reason for the decision. The threat of harsh taxes on imports has been

looming over American companies, especially carmakers.

Donald Trump has launched a series of attacks on Twitter are making big

US multinationals who import goods from abroad and sell them in

America. In particular the President-elect has spoken out

against auto companies manufacturing cars across the border. The North

American free trade deal allows vehicles to be sold duty-free within

the US, Canada and Mexico if they are at least 65% made in the block.

Trump wants to rip up the agreement and impose a 35% border tax.

In other news:, shares of the Japanese conglomerate Toshiba are

recovering by 2% after falling 5% earlier. That follows a report that

Japan's security watchdog suspected the company of padding profits over

the last three years by more than $400 million. A newspaper has said

the exterior -- X -- exchange commission have reported it to

authorities. At a strike to come after rejecting a pay offer with

British Airways according to the Unite union with strikes planned

over Christmas holidays suspended after the new offer was made. The

union members rejected it by 71. The airline says it will provide further

details to customers on Friday when it has finalised contingency plans.

Now, Chinese banks have begun imposing additional requirements on

customers who want to buy foreign currencies. Each Chinese citizen has

a quota of $50,000 they are allowed to exchange every year and it resets

in January. With the strong US dollar and concerns about the

weakness of the Chinese yuan, that is adding two rules to be able to

stop a rush to exit. He is the view from an economist in Shanghai. What

happens every year it is on January one the quota is reset, and over the

last one and a half years roughly $1 trillion has left China both through

companies and individuals and the concern at the central bank is at

the start of the year there would be a stampede to the exit, so it has

kept the $50,000 quota and now banks have to report any transaction of

more than $10,000, so effectively they are trying to put years to slow

the rush to the exit. -- gears. You say it has been $1 trillion, is it

correct, leaving the country, so this is a worry for the Chinese

authorities - how are they going to address it, will these rules be

enough? They are trying to address it in a variety of ways, so the

rules announced in the last days are relating to individual transactions

by individuals. Beyond that, over the last couple of months, they have

put restrictions on companies doing transactions abroad, whether buying

companies, property, foreign investment, and they are basically

stepping up scrutiny along every step of the chain, making it a lot

harder for money to leave the country. At the same time they are

determined to encourage what they see as good foreign investment. As

you know, there has been Chinese investment in energy and financial

sectors, buy-in sports teams around the world, they want to see the good

investment taking place, whereas what they are concerned about is

people rushing out to buy property or looking to acquire any kind of

foreign asset because they are concerned about the Chinese economy.

There are concerns about this amounts to capital controls. They

are denying it. It doesn't help that the US dollar is strong because

interest rates in the US are higher. What has been happening when Donald

Trump takes office? As he says, he labels China a currency manipulator?

The trade war is a concern, if he caused them a currency manipulator,

although that doesn't necessarily lead to specific action. China is

worried it will eventually lead to steep tariffs, so China is buying

time with Trump, you can see it has on the one hand criticised what his

team had threatened and it is trying to give enough space, wiggle room,

to back down from his fierce rhetoric.

Now, investors snapped up shares of fear not airlines on Tuesday. The

government owned airline offered new shares -- Vietnam Airlines. The

airline is valued at just over $2 billion. This might benefit the

government, which wants to sell off the majority stake in the carrier. A

monitor of the airlines industry has more on how the sale is likely to

unfold. It is a very small stake and it stems from the government's

concern about letting these assets go to cheaply, accounting for the

small stake size. What will they hope to gain? The government

realises it is not a great place to run an airline. Governments in

developing nations who have run airlines don't do a good job of it,

so it makes sense that they want to offload and bring in foreign

partners. It is interesting you say they are trying to get rid of it, we

know this huge demand in aviation is an area that is set to grow, the

International Air Transport Association essentially estimating

the region is among the top five fastest-growing in the next 20

years, so we saw the IPO price skyrocketing, what do you a tribute

that too, growth in the sector? It would be part of that, it is a tiny

stake size though, so there is pent-up demand to take up V is a

boom story -- attribute. There is a bit of it going on. If you want to

play the airline sector in Vietnam you don't have any other options

other than Vietnam's airlines of stock. The initial IPO was in 2014

but bureaucracy to lead the listing until yesterday. The low-cost rival

is always talking about an IPO and that might come out at some point as

well but we are never sure exactly when that is going to be.

Now, a cheap umbrella would usually only cost you a few dollars and that

is a good thing if you are prone to forgetting it. Well, at least year's

Consumer Electronics Show in Las Vegas, a new technology will be

launched to remind you to pick up your umbrella before you head out

the door, but does the innovation justify the pricetag?

You have a smart umbrella, it sounds like one of the more ridiculous

things on show. What does it do? Yeah, it is not ridiculous, because

what happens when umbrellas is you lose it all the time, you leave at

the height or whatever, so we decided to create an umbrella that

is unforgettable, and to do that we created disconnected umbrella. And

so how does it work? It has a small chip in the handle that is connected

here with your smart phone, and this chip sends you another, on your

smart phone, so if you leave it behind, with the Bluetooth election

not connected, it will give you an alert, to say, don't leave me stop

for those who leave it on the bus it will save money, so what will it

cost? $89, which means, you do the maths, if you're used to losing

umbrella is all the time, it is worth it. You would have to lose

quite a lot of umbrellas for that? This is also an amazing design, so

you'll never forget it. And, of course, keep across all our

CES coverage online. A quick look at the markets before

we go, because they have all opened on a positive note, that is here in

Asia, Japan of course, the Nikkei seeing the first trade for that day

into any 17. I told you about the Toshiba shares, reversing earlier

declines, they are also rising. This is because the US dollar hit a 14

year high, helping exporters, and likewise in the other markets which

have also opened higher. And that is it for this edition of Asia Business

Report. Thank you for watching. Republicans in the US Congress have

ditched plans to reduce the powers of an independent ethics watchdog,

after voters and Donald Trump