25/01/2017 Asia Business Report


25/01/2017

Live from Singapore, the essential business news as it breaks and a look ahead to the news that will shape the business day.


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Now on BBC News all the latest business news live from Singapore.

:00:00.:00:14.

Beijing must do more about counterfeiters. A warning from Lego

:00:15.:00:22.

as its boss in China can't tell the difference between the fake and the

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real thing. And the mainland's most famous tech giant Ali Barack Obama

:00:30.:00:33.

reports strong revenues and looks to soar even higher with the cloud.

:00:34.:00:44.

Good morning, Asia and hello, world. It's a Wednesday and glad you could

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join us for this edition of Asia Business Report. We kick off with

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Lego and the Danish owned company has told the BBC that authorities in

:00:54.:00:58.

China need to do more to tackle fake goods after the man in charge of

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Lego's huge new factory in the mainland failed to spot a fake piece

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from the real thing. Lego is currently involved in legal action

:01:08.:01:13.

against one Chinese manufacturer it claims is ripping off its products.

:01:14.:01:15.

Here's Robin in Shanghai. Billions and billions of these

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little plastic bricks have been sold the world over and now Lego is

:01:24.:01:29.

betting big on China. What started out with hand cut bricks in Denmark

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in 1949 is now $100 million state-of-the-art operation near

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Shanghai. But they're not the only ones doing it.

:01:40.:01:46.

Copies like this and fakes or counterfeits are prolific in China.

:01:47.:01:53.

Lego is currently suing the firm behind this copycat Star Wars model.

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So how easy is it to spot the difference? We bought a real one and

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a copycat and asked the experts. If you have to ask me to guess I

:02:00.:02:15.

would say this one maybe. Which one do you think is real? You think this

:02:16.:02:21.

one is real? You're right! The truth is, they look and feel

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almost identical. The copy's so good in fact that even the boss of the

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huge new Lego factory can't tell. Have a little look at that for me...

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What do you think of that? It looks like a mini figure to me. What do

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you think of him, two men? Which one's yours? Just have a guess for

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me. I would say this is Lego, this is not. OK, this is Lego. This is

:02:56.:03:01.

Lego? Bought from Toys "R" Us yesterday. This one isn't real, it's

:03:02.:03:07.

trying to be Lego is my assessment of it.

:03:08.:03:10.

Lego's not the only foreign firm investing big in China but having

:03:11.:03:14.

trouble with local copycats. Land Rovers are now made here. These ones

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sell particularly well. But the British firm has been powerless to

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stop this. Tucked away on a Shanghai sidestreet, this is a Land Wind, it

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is similar on the inside and very similar on the outside but a lot

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cheaper. This is our copycat that court people out, you can buy him

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and the real thing on the huge online retailer Ali Barack Obama.

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They took down thousands of links to copycat Lego products last year

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alone but that manufacturer is suing them in the courts because even the

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boss can't tell the difference. As Robin mentioned in his report,

:03:51.:03:57.

Ali Barack Obama has a huge problem with counterfeits being sold on his

:03:58.:04:04.

site. It was recently reinstated to the blacklist for selling fake goods

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but that hasn't stopped it from reporting third-quarter revenues

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beating estimates, writing 54% to 58 billion US dollars -- rising. It is

:04:14.:04:19.

mainly due to cloud and digital mean media ventures and gains in its core

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business. We were told why Ali Barack Obama continues to see these

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strong earnings. Looking at the three third-quarter earnings, they

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have had good results. In November they came out with several

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initiatives to drive sales but of course the growth rates aren't as

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high as before. They have slowed a bit and that is why they are

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focusing on other areas of business like cloud computing and digital

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media, looking at international expansion from these areas. Revenue

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from cloud business jumped by 150%. Can this be sustained? About I don't

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know if it can be sustained with the higher growth rates in China, it

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depends on how much it can expand globally. We have seen increasing

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demand from consumers and enterprise in cloud computing. But there are

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risks, you have them in the US blacklist over counterfeiting and

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there's a securities and exchange commission investigation in the US

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including accounting practices. Will this create a whole going forward

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into the bottom line of the company, will it have a reputational damage?

:05:37.:05:42.

There is definitely some negative damage that we have seen from this

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news but this isn't something new for Alibaba, it's been on the

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blacklist four years ago and now they have taken steps to try to

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counter this, for example suing sellers for the first time, it is

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sending a strong message to consumers and other potential

:05:59.:06:01.

players that they are doing something about it. Are these

:06:02.:06:06.

initiatives and measures by Alibaba sufficient? There are still a lot of

:06:07.:06:10.

fake goods sold on their online marketplace. This isn't going to be

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easy but they are addressing this slowly and then they will help them

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improve the image to the international audience.

:06:18.:06:20.

In other business news, the road to Brexit is proving to be a bumpy one

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for the UK Prime Minister Theresa May. In a landmark case, the UK

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Supreme Court has delivered a ruling against the government on the way in

:06:33.:06:38.

which the UK is to leave the EU. The highest court in the land says the

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Prime Minister must get the authority of Parliament before she

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can trigger Article 50. But ministers have insisted there will

:06:46.:06:49.

be no delay. Japanese exports rising for the first time in December for

:06:50.:06:56.

more than a year, data shows gaining 5.4% from the previous year, up for

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the first time in 15 months and this is mainly due to a pickup in global

:07:01.:07:05.

demand and the effects of a weaker yen the dollar. US President Trump E

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is pressing home his policies by meeting with the heads of the big

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three US carmakers. He's urging them to build more vehicles in America

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and during a White House meeting with the chief executives of General

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Motors, Ford and Fiat Chrysler he promised to make investments more

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attractive through cuts in regulations and taxes. He has

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criticised some carmakers, warning them about expanding facilities in

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Mexico and elsewhere and expecting to import vehicles tariff free. Mr

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Trump has invited the Indian Prime Minister Narendra Modi to visit the

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White House later this year. They had a phone call on Tuesday but what

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else did they discussed? Let's find out from our colleague in Delhi on

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how Indians are reacting to the new US President. Schleper, thank you so

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much for joining us. So what do they talk about? -- Shilpa. It was a

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highly anticipated call, at least in the Indian media here, because

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everyone wondered what Mr Trump was going to talk about and apparently

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he called Mr Modi a true friend and India a true friend and a partner in

:08:20.:08:22.

facing challenges around the world and he personally praised Mr Modi

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for championing the fight against bureaucracy in India and promoting

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the economy but they also resolved to look at challenges in various

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parts, like the fence and trade and they discussed security in the

:08:38.:08:41.

region, both south and Central Asia. So it was a highly anticipated call

:08:42.:08:45.

here so the media here is covering it non-stop. What are the concerns

:08:46.:08:50.

of Indians regarding the new US President? This is the thing. During

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his campaign he has been largely positive about India but there are

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two big concern areas, one is the whole make in America rather than

:09:04.:09:08.

make in India policy, India has been promoting manufacturers coming here

:09:09.:09:12.

and making things cheaper and more efficiently, whereas Trump's whole

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policy has been make in America so there's a foreign investors will

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close up their units and go back home to America. The second big

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concern is of course about the visas, the skilled visas, H one B,

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as they call them, is crucial for the IT industry in India to do

:09:33.:09:36.

business with the US and the US accounts for 60% of all IT exports

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from India. And Mr Trump has been largely critical about these visas

:09:43.:09:45.

and the way they are used to promote more migrant workers and taking, as

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he says, taking jobs away from Americans. That is a big concern for

:09:53.:09:57.

the IT industry here, which is already discussing how they can

:09:58.:10:02.

campaign in the US and how they can really push their cause. All right,

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he's one of the first leaders to be invited to the White House this

:10:08.:10:13.

year. Thank you so much, Shilpa from Delhi.

:10:14.:10:16.

Let's have a quick look now at the markets and as you can see, most of

:10:17.:10:22.

them are in positive territory, the Nikkei 225 gaining 1.4%, the Hang

:10:23.:10:27.

Seng opening up by nope .5% and the all ordinary is in positive

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territory by 0.3% because of the positive mood on Wall Street and the

:10:32.:10:43.

broader S closing at record highs. -- -- 0.5%.

:10:44.:10:48.

The Chinese government has rejected criticism from President Trump's

:10:49.:10:54.

administration over the South China Sea,

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saying it will be firm in safeguarding its rights

:10:57.:10:59.

The UN Secretary General has expressed concern over Israel's

:11:00.:11:02.