12/05/2017 Asia Business Report


12/05/2017

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One belt, one road. China gears up for its first new silk Road Summit

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in Beijing. What will it mean for investors. Skyhigh prices for homes

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in Asia. Which property market gives you the best bang for your buck? It

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is Friday, everyone. Thank you for joining us. I am Rico Hizon. 28

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world leaders will gather in Beijing over the weekend to discuss China's

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grand plan to invest billions of dollars to improve its global trade

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links. What is known as the one belt one road initiatives is crucial for

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the Chinese president. There are concerns that it is masking other

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ambitions. Our correspondent has the details. By sea and by land China's

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president has a big idea to bring his country closer to some of you.

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It is called one belt, one road. An awkward and confusing name but it is

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about trade links. The belt refers to this, road and rail that heads

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west through outer China. But look at this. This is the road. Maritime

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that heads south and then West. China wants to take ancient silk

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Road trading routes and update them by ploughing hundreds of billions of

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dollars into infrastructure in various countries along the way. New

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ports, pipelines and railways. The President has made it his signature

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policy. China's president talks about it a lot and the figures

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bandied around are huge. Dozens of projects planned, ambitions to spend

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maybe half a trillion dollars. But, still, they need this. What appears

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to be a government propaganda video. This is the reality of the belt and

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road grand plan. As growth in the economy slows, China wants to find

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new markets. One of the big worries abroad is 1-way traffic. The

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government makes it difficult for many foreign firms to operate here,

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selling Spanish wine to the growing rich middle class should not be

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difficult but... Last, but not least, there is the suspicion that

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China is spending big to increase its influence, plain and simple.

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China trading with the rest of the world is nothing new but it is the

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scale that is so different. One belt one road is hugely ambitious but

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there is much rhetoric around it. Now it is up to this president to

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make sure it all comes together if it is to be more than just his pet

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project. So what will this huge

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infrastructure project means for investors? We speak to the Canadian

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Chamber of Commerce in China. I asked him what Canadian businesses

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thought of this initiative. I think Canadians another international

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business people are excited about the expansion of infrastructure.

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However we always like to see the Devil in the detail and Howard is

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executed over time. If we see the devil and the detail, how do you

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think this will benefit the Canadian business? From a basic point of

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view, the expansion of infrastructure, it will definitely

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increase trade between second-tier markets in China and second-tier

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markets in Canada. Likewise, around the world. However, I think the

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issue remains what is going back and forth between the two countries. Is

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that trade balance? What are you expecting and what are you looking

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forward to in this one belt one road summit taking place in Beijing? I

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think what comes out will be interesting. Much of it will be

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details that a prearranged in that, we all know that infrastructure is

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going to expand very greatly, um, we know that this will connect China to

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any countries in Central Asia, western Europe. However, aside from

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just a building a lot of infrastructure, what services come

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out? I think it is a mystery to everybody. A mystery and an

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ambitious plan from the Beijing government. If the US policy for

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America first pushing its allies to look to China for better global and

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regional leadership? On behalf of Canada, definitely. They have, the

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US have slapped a tariff on Canadian lumber, China is our second biggest

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market for our lumber. Canada has spent decades selling wood into

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China. The policies of the Trump administration are certainly making

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China far more important a trade partner than they were before. In

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other business news making headlines the value of that coin has set a new

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all-time high rising above 1800 dollars on Wednesday. Industry data

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shows it has settled back to 1789. It is the second time this week that

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new highs have been set. Market value of Bitcoin has increased

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significantly in four days. Owners of snack Shack are still struggling.

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They are still down in New York trade. This comes after Snap posted

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a big loss of over $2 billion in its first quarter since it listed on

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Wall Street in March. New Sun have warned that profits could fall. It

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expects profits to fall nearly 20%. The profit warning comes one day

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after Toyota predicted tough times ahead due to slowing stay sales in

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the United States and the strong Japanese yen. The downturn in the US

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retail sector shows no sign of letting up. Macy's reporting a ninth

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consecutive quarter of falling southward profitability down by 39%.

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Fears of the prospects for retail spread to rival department store

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chains with others falling between five to 8%. For most people, a home

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is the most expensive thing they will ever own. Real estate is a

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major investment for many people here in Asia but you should you put

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money into an expensive market like Hong Kong or bet on a rapidly rising

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real estate market like India? We spoke to the chief executive of the

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property firm JL L. Talk to anyone who owns property or who wants to

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get on the property ladder, the value of homes preoccupies the minds

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of most. Where to live and what to buy here in Asia is a bit of an

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obsession and who better to make sense of it all than the chief

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executive of JL? We have two minutes with you starting now so I will

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start by asking what the property market is like here in Singapore and

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the region? Singapore or at the bottom of the market at the end of

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last year but we saw a U-turn of 1% in the luxury sector. We feel with

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the easing of the measures in the residential sector, improving

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sentiment in the economy it is a good time to buy residential and

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Hong Kong. Prices are already high so there is an expectation they may

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ease away. Japan is a surprise, they are worth chasing and Australia has

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always been a favourite given the quality of life there. Looking at

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China, we know that there are capital controls in place right now

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and the Chinese were huge buyers in the region. How has that impacted

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the property market? In the middle point of last year, Chinese

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investors were very focused on Europe and the Americas, obviously

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what has happened with Trump and Brexit the money has come away from

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those markets and combined with the anti- curbing measures with the

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Chinese currency much more focused on investing in Asia-Pacific despite

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some cost-cutting measures. If China can support a wonder one Road,

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government approvals will come through. You are the chief executive

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of JL L here in the Asia-Pacific region. What are some of your chief

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duties? It is fantastic to be here in the Asia-Pacific. The growth

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driver of the world at the moment and, therefore, globally there is a

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lot of pressure on us to grow our business. We have been here for 50

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years and there is absolutely no shortage whatsoever of opportunity

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here. Our greatest challenge still remains a talent. We are service

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sector and talent is critical. As a brand we must remain relevant and we

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must retain the best talent in the real estate sector. As a property

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investor, we should I invest? You know Singapore, you feel comfortable

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here and I think Singapore is a safe bet. A little bit of a wild card, I

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would start looking at India and Japan as future will potential

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residential opportunities. Let's have a look now at the markets

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and Asian stocks are flat to negative right now after US

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securities fell overnight. And worse than expected sales dropped from US

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department stores. Fears are that consumers are not spending enough.

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This impacts Asian markets because many of the products being sold in

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the US are being purchased from Asian markets. The Japanese market

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is down by 40 and the All Ords down by 11. Have a productive Friday,

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