27/06/2017 Asia Business Report


27/06/2017

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

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America first or made in India? Well Trump hails Narendra Modi for

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boosting the economy, there are several thorny issues which could

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make for an uncomfortable visit. And as we mark the 20th anniversary of

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the Asian financial turmoil, we met with South Koreans who sacrifices

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were worth their weight in gold. -- whose sacrifices. Good morning Asia,

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hello world. It is a Tuesday. Glad you could join us for this edition

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of Asia Business Report. I am Rico Hizon and as we recorded on Newsday,

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Narendra Modi has just met with Donald Trump at the White House.

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Both men portray themselves as outsiders and promised to bring back

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jobs during their campaigns. President Trump had this to say

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about his counterpart. Thank you very much. It is a great honour to

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have Prime Minister Narendra Modi of India, who has been such a great

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prime minister. I have been speaking of him and reading about you, and

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you have done a great job economically, and India is doing

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very well, and in so many other ways. So I would like to

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congratulate you. I would like to congratulate you very much. Well,

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despite the praise, there are some thorny issues that they need to

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address. But, as our North America business correspondent told me

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earlier, Prime Minister Narendra Modi did not waste his time meeting

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with some take bosses in Silicon Valley before meeting with the

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President. Modi made a stop on Sunday where he met with some

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executives of big American tech companies. Obviously the two have a

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close tie, these two countries, in part. Many of the American

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technology giants depend a lot on intellectual capital, if you like,

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that comes from technology workers from India. That is actually one of

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the sources of tension when he met with Donald Trump. They were keen to

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downplay the issue of the H-1B these are when the two met a short while

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ago. When they stood at the podium and gave their speech Donald Trump

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gave a joking reference to the fact that he wanted America to be as

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fast-growing as the Indian economy was, and he hoped that certainly it

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could start to see the rapid increase in GDP growth that India

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was currently enjoying. And currently that H-1B these are's

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status is under review by the Trump administration and during his visit

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both countries will try and come up with a middle ground. Yes, watching

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these two leaders speak, they were keen to emphasise what the countries

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have in common and to avoid going too dip into some of the trade

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tensions which exist. You mentioned the H-1B Visa. That is one area I

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suspect that Narendra Modi was keen not to push too hard, this programme

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which allows American companies to hire hi-tech workers from abroad,

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who may be paid less. It certainly has benefited Indian workers. About

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70% of those visas go to Indian nationals. In particular that has

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benefited Indian technology companies, not at this meeting, like

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I say, they didn't want to dwell on it too much. It makes for a

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difficult meeting at a time when Donald Trump has emphasised America

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first and talked tough on immigration. So this was really all

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about trying to emphasise what these countries have in common. Now to the

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latest developments with the UK's decision to leave the EU and the

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government has outlined in some detail what will happen to EU

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citizens in the UK once Brexit happens. Here is the Prime Minister

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speaking earlier. I know there has been some anxiety about what would

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happen to EU citizens at the point we leave the European Union. Today I

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want to put that anxiety to rest. I want to completely reassure people

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that under these plans no EU citizen currently in the UK lawfully will be

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asked to leave at the point the UK leads the EU. We want you to stay.

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In other business news making headlines, troubled electronics

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giant Toshiba will sell its business as early as today. They have been in

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final negotiations with a group led by the Japanese government. And the

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summer meeting of the World Economic Forum is taking off today. At this

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year's event, innovation and sustainability rank high on the

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agenda and according to industry research China is now home to almost

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100 unicorns, private companies worth more than 1 billion US

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dollars, and their combined value is estimated to be a staggering 445

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billion US dollars. Earlier I spoke to our correspondent about

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innovation with a Chinese touch. There is a lot under discussion,

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about things like Artificial Intelligence. I think there are

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three different panels on AI and the impact AI will have. So innovation

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and automation and AI are big on the agenda as well as China's role in

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the world. Are western countries now viewing China as a country of

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innovation, or is it still being branded as a land of copycats? I

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think there still is a belief that China is a land of copycats, but I

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think that was five or ten years ago. You have now... I heard about a

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company in the States two weeks ago which is trying to emulate a

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communications platform in China so we now have western companies going

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to China for ideas. Things like financial services and payment

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technologies in China are far ahead of the West. But how does China

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right now, Tony, stacked up in terms of innovation vis-a-vis the

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Japanese, the South Koreans, the Americans and the western Europeans?

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When you look at things like intellectual property and patent and

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that kind of thing, China is now ahead of all of them except the US.

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It is expected to catch up with the US at some point. The real issue is

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around the efficacy of those patterns. How often are they

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referenced, how powerful are they, that sort of thing -- patents. They

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are not there in terms of number, but they are getting there. And as

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we mentioned yesterday, it is nearly 20 years since the Asian financial

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crisis and during that time banks throughout Southeast Asia were in

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danger of collapsing. South Korea was brought to its knees and

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accepted a bailout from the International Monetary Fund. The

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nation's women donated their own gold to help protect the economy.

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Our correspondent Steve Evans met with one of the women. 20 years ago,

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ordinary citizens took the wedding rings from their fingers and gave

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them away to their country. TV campaigns mobilised South Korea as

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it ran out of money to buy imports. Banks were on the verge of

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bankruptcy. A third of the country's biggest conglomerates were bankrupt.

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One of the ordinary people who stepped in was this woman. She was

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honoured later for her patriotism. TRANSLATION: We gave rings that were

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gifts when our children were born, and when I got married. They had

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great sentimental value, but we decided to sell them to save the

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nation. So, 20 years on, was it all worth it? TRANSLATION: Of course it

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was worth it. I believe we played a part in helping the country at a

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time of crisis. I have no regrets, and I still feel proud about it. But

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there was also opposition at the time, as belts were tightened.

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Government spending was cut. Painful change was made. In return for

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which, the IMF stepped in with $60 billion. This man was the Korean

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ambassador who did the deal. Panic, a sense of panic. It was regionwide.

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That is why it they call it the Asian financial crisis. It was just

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a great nightmare. That nightmare is over. Just look around you. This

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country thrives. The crisis was caused primarily because the banks

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were unstable. They had lent much money. Sure, the IMF came with its

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help, and sure, the people gave their gold. But governments here

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also restructured the economy. Patriotism, certainly, but more

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importantly, better policy. And tomorrow, Wednesday, we will be

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looking at the struggles faced the Indonesian economy during the

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financial turmoil, and it is to recovery for closer look at how far

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these economies have come two decades after the Asian financial

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crisis. Tune into our special programme going out this weekend,

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starting on Saturday. And before we go, here is a look at the markets.

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Let's have a quick look where they stand in early Asian trade. Some

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unpredictability. The Nikkei 225 up, the All Ordinaries down. This

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despite Wall Street closing volatile with defensive sectors emerging as

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the best performers. Thank you so much for investing your time with

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us. I am Rico Hizon. Sport

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