14/08/2017 Asia Business Report

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

On the upward trend. Japan charts another quarterly growth for the

sixth time in a row. Is Abenomics finally working? And a tale of two

economies. We focus on India and Pakistan as they mark 70 years of

independence from the British Empire. Welcome to Asia Business

Report. Live from Singapore. Let's kick off with what is on the

business calendar this week. Japan just released its latest economic

data. The world's third biggest economy expanded at an annualised

rate of 4% between April and June. That is the sixth straight quarter

of growth, driven partly by private consumption. Mid week, the bank of

Thailand will be deciding on the cost of borrowing and later in the

week, on Thursday, a lot of focus will be on Alibaba as it releases

second-quarter earnings. Earlier I spoke to a representative from the

bank of Singapore and asked about the Japanese economy and whether

Abenomics is working through the system. It looks like growth will be

between 2% and 3%, which is where Europe has been in the second

quarter. So they seem to be doing quite well at the start of 2017,

yes. There have been lots of talks about whether Abenomics has failed,

but from all the data we are getting, is it actually succeeding,

in your view? I think from the growth numbers it is succeeding.

Labour markets are the best they have been in decades, so from that

perspective Abenomics has worked. Where it has worked as on the

structural side, raising the long-term growth rate, improving the

operational behaviour of companies, improving governance significantly.

So they have done well to stimulate growth and get things back to

normal. They haven't done much to change what normal represents, and

that has been the failure of Abenomics. What has been rattling

the region over the last few weeks has been growing tensions between

North Korea and the United states. We are starting to see a rush to

safe haven, in your view? Certainly some safe haven flows. Gold is doing

well, the Swiss franc, and rather strangely the Japanese currency went

well as well, which is strange as it is on the flight path and has a long

history of tension with North Korea. There is a bit of a bump, but

nothing to severe. And of course, China plays a significant role in

these growing tensions. There have been talks of President Trump

possibly signing executive orders restricting intellectual property.

What is your view on that? I think it is a real difficulty because when

you have a transactional approach to policy, there is no predict ability

or framework they are operating in. It is one of those things, if you

help us here we will help you there, so you can't see what they will try

to achieve. Obviously they have multiple goals but they are not

necessarily compatible. At the moment it looks like he wants to

bully china on trade with the hope they will help with North Korea.

That doesn't seem like a very realistic ambition to anyone in the

region. And briefly, before we let you go, we have significant figures

from the Chinese economy as well. What are you predicting? Industrial

production is tipped to grow about 7%. It has picked up in the last six

months or so. People are worried about slowdown in China, it is a

perpetual concern. So far the economy is doing fairly well heading

into big vertical events later in the year. In other business news,

the chief executive of the Commonwealth Bank of Australia says

he will retire in the wake of a scandal over allegations of money

laundering and terror financing allegations. He has been the head of

Australia's biggest bank since 2011 but recently it has been embroiled

in civil charges stemming from alleged breaches of financing rules

which wiped out the lives of dollars from its market capitalisation. He

is expected to step down in June 20 18. The price of Bitcoin has broken

past the $4000 mark for the first time in its nine-year history. The

value of the digital currency has more than quadrupled so far this

year. Joining me here in my studio is the BBC's business reporter. Yet

another record, but it has been rather volatile. That's right,

crypto currencies like Bitcoin have been on a rollercoaster ride, and

that is largely because it remains an unregulated market. So unlike

other currencies there is no central bank that controls though

currencies. They are also traded electronically, 24 hours a day and

seven days a week. With Bitcoin, the oldest and most valuable crypto

currency, we saw prices past $4000 on Sunday morning, he began a market

capitalisation of more than $60 billion. That is really large, more

than triple the price of gold. So now some people are questioning

whether crypto currencies like Bitcoin exist in a bubble, because

some claim that these currencies basically have no fundamentals, and

that they are being driven by people looking to make a quick buck. Thank

you for the update. We will continue to monitor the price. Back to Japan

and its rigid education system, where children are taught to follow

rules and strive for perfection. It is often blamed for the lack of

entrepreneurship in the country, but what if you drop out of the school

system? As part of our Jumpstarting Japan series, I caught up with a man

to find out how he found his own success. Meet the brainchild of Ken,

and his avatar. Ken created this avatar to address the loneliness he

felt as a child. TRANSLATION: For 3.5 years, from when I was ten, I

couldn't go to school because of illness. I felt so unbearably

lonely. I started to wonder if they had a healthy clone, could he make

good memories at school instead of me. That was the beginning of

wanting to create my own avatar. In a country which allows no room for

failure, even as a child, Kentaro could have been easily left out of

the system, but his teacher introduced. The idea is the robot

can be at places where its users cannot be.

So there are 120 units that have been rented out across Japan, and

they are thinking of exporting it as well. And his robot is helping those

with motor neurone diseases like ALS. This 30-year-old is learning

how to use it so he can continue participating in society.

TRANSLATION: I learn that even when I use all my muscles my eyeballs

will be able to move -- when I lose. So I want to prepare myself by

learning different tools to communicate. Kentaro 's innovation

has given bedbound people the power to be part of the workforce, and it

can be used by the elderly, or mothers with small children. From an

awkward child, Kentaro has regained his confidence and found his own

success. As we told you want Newsday, 70 years ago Britain pulled

out of India, marking the end of empire on the subcontinent. So what

has become of the economies of Pakistan and India? How do they

differ and how much do they rely on each other? Our correspondent

reports. Since partition, India and Pakistan have charted very different

economic parts. India's economy was bigger than Pakistan's right from

the start, because of the size of its population and the fact that it

inherited financial and government institutions. Today, India's economy

is almost eight times bigger than its neighbours. But what is

interesting is during the first 50 years both nations saw similar

economic growth. In fact, the average income per person in

Pakistan was higher than India during this period. But, since the

start of the 21st century, India's economy started to grow faster,

widening the gap. This is largely down to the economic reforms in

India in the 1990s when it opened up its markets for foreign and private

investments. Today, India and Pakistan are the largest economies

in East Asia, but they don't trade with each other much. Their trade is

less than what they trade with smaller neighbours like Bangladesh,

Sri Lanka and Nepal. Part of the reason is what Pakistan calls its

negative list, which bans the import of more than 1200 goods from India.

These goods range from toothbrushes and diapers to cars and even cricket

bats. India also levies taxes on goods imported from Pakistan. That

said, informal trade between the two countries is thriving, and it is

estimated to be close to $5 billion. That involves shipping goods to a

third country. Traders both in India and Pakistan used to buy two get

goods to each other -- use to buy. -- Duabai. The total trade between

the two countries could touch $10 billion every year. Checking the

markets, despite the fairly solid GDP figures, the Japanese Nikkei is

down because of the strong yen, which is seen as a safe haven

currency as tensions grow between the United States and North Korea.

Australia is also down by almost 1%. That is it for this edition of Asia

Business Report. Thank you for