15/08/2017 Asia Business Report


15/08/2017

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

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President orders an investigation into whether China is stealing

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intellectual property from US companies -- President Trump. And

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starting over is never easy for any family business, but one candy store

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in India has tasted sweet success. Good morning, Asia, hello, world. It

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is a Tuesday. Glad you could join us for this edition of Asia Business

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Report. I am Rico Hizon. Just a few hours ago President Donald Trump

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asked for an investigation into alleged Chinese theft of American

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intellectual property. This order comes as US ties with China are

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streamed over North Korea. We will combat the counterfeiting and piracy

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that destroys American jobs. We will enforce the rules of fair and

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reciprocal trade that form the foundation of responsible, so. Well,

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according to the US government, intellectual property stolen by

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China is estimated at more than $300 billion. And China is said to

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account for between 50% to 80% of global intellectual property theft.

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Mr Trump's tough talk on trade with China has been going on for a while,

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but what exactly is prompting this latest decision? I spoke to a

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correspondent in Shanghai. I think Trump is right. He should be

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criticising China for the over protectionism in the country, as

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well as for copyright intellectual property issues. I think first off

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it is really unfair at this stage that a lot of American companies

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like General Motors have to set up a joint-venture if they want to

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establish a factory in China. The concern is that right now there is a

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lot of transfer of technology to the Chinese joint-venture partner. So

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today you are going to be helping your partner become your competitor

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in five years. Or you have other situations like Elon Musk's Kessler,

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they have announced they would like to open a factory in China but they

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are having problems getting the permits to do so because they are

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not willing to have a joint-venture partner -- Tesla. Is the right in

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saying American companies are being hurt to the tune of 300 billion US

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dollars? Well, I think $300 billion might be a slight exaggeration. I

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think if you add up over the last 20 years maybe I hitting close to that

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number. At the reality is that China was right to be somewhat

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protectionist ten, 15 years ago. Their industry was in shambles. They

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really needed to have that infant syndrome where you protect your

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industries. But right now that sort of protectionism is hurting the

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country. A lot of western brands that I talk to are now looking

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towards Indonesia, or Sri Lanka, or even Africa to invest, because they

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are concerned about unfair trading practices in China. In corporate

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America, the boss of drugs giant Merck has resigned from the business

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panel led by Donald Trump over the President's response to a violent

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white nationalist rally which took place in Virginia over the weekend.

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I spoke to our correspondent from New York and I asked why the drugs

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chief executive, Ken Frazier, resigned. Merck's CEO use the

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company's Twitter account to explain his decision to step down. It was

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from the President's Manufacturing jobs Council. He, it is worth

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pointing out, is one of America's most prominent African-American

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business executives. And he explained that as Merck's boss and

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as a matter of personal conscience he felt a responsibility to take a

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stand against extremism. Many people are seeing this as an apparent

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criticism of Donald Trump, who took two days before coming out and

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criticising and condemning explicitly white supremacists for

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the violence that occurred over the weekend, and that led to the death

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of a woman. What we saw, though, in the immediate aftermath of the

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criticism from Ken Frazier is Donald Trump then taking to Twitter and

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criticising him, attacking the company, saying that they were in

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part responsible for higher drug prices. So what have other

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executives done, who were part of this advisory Council? Have they

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sided with Ken Frazier, have some of them also resigned, or have some of

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them basically stayed put? I have spent much of my day reaching out to

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some of those CEOs, which really reads like a who's Who of the

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corporate world in America. You are talking about the head of Pepsico,

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the chairman of General Electric. The heads of Mark Stone and Black

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Rock. These are well-known global companies. -- Blackstone. Many

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responses followed a similar pattern, which was to condemn the

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violence we saw over the weekend. It is worth pointing out that none were

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prepared to go as far as Ken Frazier, and none were prepared to

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give up their place on presidential advisory councils. And we just

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learned minutes ago that the chief executive of Under Armour will also

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be stepping down from the Trump administration's American

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Manufacturing Council. He said in his tweet I love our country and

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company. I am stepping down from the council to focus on inspiring and

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uniting through power of sport. That was the CEO, and it follows Ken

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Frazier's resignation from the Council of President Trump. Moving

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on to the partition of India, which triggered the largest mass movement

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of people ever, Hindus moving to India and Muslim is moving to the

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newlyformed state of Pakistan. Among the millions affected were people

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with flourishing businesses they had run for decades. One suites

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franchise eventually thrived in a new homeland, but it was a painful

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and challenging journey. Partition was destructive for everyone. We had

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to start once again from zero. We had the restaurant in Karachi,

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and due to partition we had to move to Bombay. Business takes years to

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build and it can take minutes to destroy.

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Our base in Karachi was totally destroyed. Developing and Bombay, it

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is hard work in Bombay. It is not imported from Karachi.

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Well, this is the house where we had come and stayed here. It was almost

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like a dormitory. And all of those who came from Karachi stayed with us

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for a number of years before we could establish alternative

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arrangements. The memory cannot be wiped out

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entirely, and therefore the pain is still there. The mockery of the

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whole thing is that it was not a question of I that religion or

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politics or state, then what was the cause of partition? After the

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WannaCry attack in May caused chaos and confusion around the world,

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cyber security is at the forefront of many minds, especially for

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business. As CEO spent three decades fighting cyber crime with the FBI.

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He told my correspondent what companies can do to defend against

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cyber attacks. Think about this. Instead of starting with the

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technology, start with the adversary. There are really five

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categories of at the street you have to consider. Nationstates,

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multinational Grimal organisations, hacktivists, terrorists and the

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insider threat. Think about your corporate strategy and corporate

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assets and ask yourself which one of those categories of adversary would

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be most likely to come after you to do harm? At certain times it will be

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a multinational Grimal organisation, other times it could be hacktivists.

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We have seen global attacks like WannaCry, even crime against states.

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So how bad could the situation become? What are some of the worst

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case scenarios? WannaCry, really, if you had a mature cyber security

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programme, was a nonevent for most companies. The patch came out in

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March and the event started in May. So think about having very

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mainstream programmes in your company, such as patch management

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and how you allow access to your network, and you can explain and

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defend against that. You can resolve a great deal of these problems with

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just routine behaviours and cyber security. And do you think companies

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generally are taking this threat seriously? It depends on the

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industry. If you go to the defence industry, the financial services

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sector industry, and communications, they take it very seriously. But, as

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you get into other industries, healthcare, retail, hospitality,

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they are really not as mature as they need to be to defend against

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these attacks. Thank you so much for investing your time with us. I am

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Rico Hizon in Singapore. Sport Today is coming up next.

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The top stories this hour: North Korea's leader has been

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