:00:16. > :00:22.Janet Yellen makes her debut in front of the new Congress. She hints
:00:23. > :00:26.at any rate hike in the next few months. And shares in Toshiba
:00:27. > :00:38.nosedive yet again as the Japanese conglomerate faces a $6 billion
:00:39. > :00:44.write-down. It is Asia Business Report. Good morning, Asia. Hello,
:00:45. > :00:47.world. Markets have been buzzing overnight as the head of the US
:00:48. > :00:51.Central Bank said an interest-rate rise could come as early as next
:00:52. > :00:57.month. In the SME annual testimony to Congress, Janet Yellen set of
:00:58. > :01:02.hawkish tone, saying it is unwise to wait too long to hike rates.
:01:03. > :01:10.Financial stocks in the US lifted. The broader S index closing higher
:01:11. > :01:15.for a fourth consecutive session. This is how Asian shares are trading
:01:16. > :01:20.in early trade on Wednesday. All in positive territory. More analysis in
:01:21. > :01:25.a moment but that hear what she had to say. As I noted on previous
:01:26. > :01:33.occasions, waiting too long to remove accommodation would be
:01:34. > :01:37.unwise. Potentially requiring the FOMC to raise rates rapidly which
:01:38. > :01:44.could risk disrupting financial markets and pushing the economy into
:01:45. > :01:47.recession. At our upcoming meetings, the committee will evaluate whether
:01:48. > :01:55.employment and inflation are continuing to evolve in line with
:01:56. > :01:58.these expectations in which case, a further adjustment of the federal
:01:59. > :02:07.funds rate would likely be appropriate. So what would be the
:02:08. > :02:14.impact of rate hikes on Asia? For monetary policy in the region, this
:02:15. > :02:19.is going to be a very interesting cycle. I do not think the Asian
:02:20. > :02:24.banks are going to be following the Federal Reserve 's is much in the
:02:25. > :02:29.past. We only have one Asian central back -- bank, the Philippines,
:02:30. > :02:35.raising rates. Some, like South Korea, might cut rates further. If
:02:36. > :02:40.this is the case, seeing another rate rise as early as next month,
:02:41. > :02:47.could we see falls again in Asia's emerging currencies like what we saw
:02:48. > :02:51.in 2015 and 2016? We think so. We think that is the risk for Asia. I
:02:52. > :02:56.don't think the market had been pricing in how much of a chance
:02:57. > :03:02.there was of a hike in March. I think it's probably 50- 50 after
:03:03. > :03:06.Janet Yellen's testimony and the possibility that there could be more
:03:07. > :03:09.than two hikes this year so the risk is, the Asian currencies could
:03:10. > :03:15.weaken and what that could do, it could lead to some foreign come --
:03:16. > :03:21.foreign currency debt mismatch problems in Asia has built up since
:03:22. > :03:30.2008 a lot of debt so that is a risk. Who could be the biggest Asian
:03:31. > :03:35.victims? Malaysia? Indonesia? I, the Philippines? Some of the Southeast
:03:36. > :03:40.Asian countries do have quite a bit of foreign bond holdings. Malaysia,
:03:41. > :03:45.Indonesia. Some have current-account deficits. Indonesia, India. But to
:03:46. > :03:49.be honest the biggest debt is in the north-east Asian countries like
:03:50. > :03:54.China and Asia and South Korea and Taiwan and Singapore as well. With
:03:55. > :03:58.these huge dollar denominated debts due to the strengthening US dollar,
:03:59. > :04:04.could we see potentially a financial crisis brewing in Asia going
:04:05. > :04:10.forward? That's a tricky one because what I would say is Asia doesn't
:04:11. > :04:16.have huge hard currency debts. We learnt our lesson from 1997. But we
:04:17. > :04:22.have a lot of domestic debt. The risk is, we could see a little bit
:04:23. > :04:27.of default from currency mismatch. Not our biggest problem, which is
:04:28. > :04:30.domestic debt, but it could lead to tightening financial conditions.
:04:31. > :04:35.Bondholders and banks might start to rein in credit and it spills over to
:04:36. > :04:38.tighter domestic conditions and you start to see domestic defaults.
:04:39. > :04:43.There is a bigger risk than most people see of credit stress in Asia
:04:44. > :04:49.later this year. All this could lead to slower Asian growth going
:04:50. > :04:58.forward. Robert Subbaraman there. Samsung's Chief Executive faces a
:04:59. > :05:08.potential arrest. An arrest warrant was issued. Mr Lee is being looked
:05:09. > :05:12.to be put behind bars involving bribery incident involving the
:05:13. > :05:17.President. Shares in Samsun are down over 1%. Facebook is launching an
:05:18. > :05:22.application which will allow users to stream videos on their news feed
:05:23. > :05:28.through set-top boxes such as Apple TV so they can enjoy the videos on a
:05:29. > :05:33.bigger screen. Rivals such as hammers on and Samsung have similar
:05:34. > :05:40.services. Shares in Toshiba are falling by 10% in Tokyo and that is
:05:41. > :05:44.after a plunge of nearly 50% since December and that is when the
:05:45. > :05:49.company first warned investors about a massive write-down in its US
:05:50. > :05:53.nuclear business. Yesterday the firm was supposed to be reporting its
:05:54. > :05:58.earnings but at the last minute, postponed the announcement and that
:05:59. > :06:03.wasn't the only surprise. At Tokyo correspondent explains the days
:06:04. > :06:06.events. First we expected the announcement of big losses and then
:06:07. > :06:10.they cancelled the announcement and then we got a statement from the
:06:11. > :06:17.chairman saying he was resigning and finally we got these provisional
:06:18. > :06:21.figures which include a $6 billion loss at Toshiba's North American
:06:22. > :06:27.nuclear division. We won't get the full results but it is clear that
:06:28. > :06:32.Toshiba is in serious financial straits. What happens now to Toshiba
:06:33. > :06:36.is unclear. The Japanese government may step in to rescue the company,
:06:37. > :06:39.it could be broken up but the real question nobody is sure about is
:06:40. > :06:44.what will happen to its North American nuclear division which is
:06:45. > :06:46.deep in debt and still is constructing for nuclear power
:06:47. > :06:52.plants which are halfway through construction. What is really clear
:06:53. > :06:59.is nobody wants that business, there are no potential buyers apart from
:07:00. > :07:03.perhaps the Japanese government. One unit that is attracting interested
:07:04. > :07:08.buyers is its memory chip business. It is a crown jewel of the firm but
:07:09. > :07:17.the boss of Toshiba said in a press conference that he was willing to be
:07:18. > :07:21.flexible about its fate. Our memory chip business, we want to secure
:07:22. > :07:25.resources which will spur future growth. We are thinking very
:07:26. > :07:29.flexibly which means we will not fixate on having majority stakes in
:07:30. > :07:37.the business and will consider introducing external capital with a
:07:38. > :07:42.flexible mindset. Journalists expressed frustrations with one
:07:43. > :07:49.saying, what also you hiding? If you want to read about it, go to our
:07:50. > :07:53.Asian business correspondence's blog and she explains the official
:07:54. > :07:58.results will be released on the 14th of March and if the company's debt
:07:59. > :08:03.and corporate governance situations aren't improving, its shares could
:08:04. > :08:09.be demoted with a second section of the Tokyo stock exchange or even
:08:10. > :08:12.delisted. The Indian space agency is attempting a world record by
:08:13. > :08:16.launching 104 satellites in the one go. Its commercial launch operations
:08:17. > :08:20.are much cheaper than any other country and it's creating a thriving
:08:21. > :08:33.ecosystem for privately space programmes. We visited one of them.
:08:34. > :08:42.It's a race to the moon to put the privately funded space craft and
:08:43. > :08:47.India's Team Nimbus is one of the finalists. They are betting they
:08:48. > :08:54.will get there first. This is a small rover built I team Team Indus
:08:55. > :08:58.and it has been to simulate the moon's service. I will try to
:08:59. > :09:04.control it with my phone. It's not meant to be fast. If it is
:09:05. > :09:11.successfully achieving this for 500m on the moon's surface, it stands to
:09:12. > :09:17.win a prize of $20 million. The team is taking part in the lunar price
:09:18. > :09:21.challenge funded by Google. It has signed a deal to hitch a ride on one
:09:22. > :09:26.of the Indian government's rockets. Mission Control is already in place.
:09:27. > :09:32.Target launch date, December this year. Once we accomplish this and
:09:33. > :09:37.prove what we can do by way of design and integrated -- integration
:09:38. > :09:40.and prototyping, we can turn around and offer these services to other
:09:41. > :09:48.folks who might be interested in space exploration. They will have
:09:49. > :09:57.tough competition. For other teams are also in the race. Israel's space
:09:58. > :10:03.cell, Synergy moon and a team from Japan also have contracts to launch
:10:04. > :10:09.this spacecraft. Go into the moon is not cheap. Team Indus says their
:10:10. > :10:13.mission costs about $60 million so even if they win, they have still
:10:14. > :10:25.lost money. Prestige and national glory is priceless. Thank you for
:10:26. > :10:30.investing your time with us. See you next hour. By the now. Daesh goodbye
:10:31. > :10:49.for now. The headlines this hour. The half
:10:50. > :10:50.brother of Kim Jong-un