25/08/2017 Asia Business Report

Many feel they're no longer earning enough here.

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

To jail or not to jail. We will soon learn the fate of the de facto

leader of Samsung, JY lay. It could be 12 years. And the latest earnings

report for Qantas. What will it take to keep the competitive edge? Good

morning, Asia. Hello, world. This is Asia Business Report. I am Sharanjit

Leyl. Thank you for joining me. It is Friday. A South Korean court is

expected to pass its ruling in a corruption case revolving around the

de facto boss of Samsung. He has been in jail since February since

been charged in a scandal leading to the outing of the former president

of South Korea. I am joined live from Seoul in front of the

courthouse. What are we expect today? Well, he will be presented

behind me in court. Prosecutors have asked for a 12 year jail sentence

for him. The big charge is bribery. He is accused of donating to

organisations run by the close friend of the former president in

return for favours that would pave the way for him to become the boss

of the Samsung group. There are also charges of embezzlement, hiding

assets overseas, perjury. We will hear today whether he is found

guilty of all of those charges. It is quite significant how large a

sentence he will get if he is guilty. A significant sentence. If

he is put behind bars, what are the future plans of the company?

Especially who takes over next? This is a family run conglomerates, run

by his family ever since being founded in the late 1930s. His

father was incapacitated after a heart attack a few years ago. He has

two sisters in the management of different parts of the group.

Samsung has not put out a formal plan according to if he goes to

jail. That is because they denied the allegations against him, saying

he did not bribe anyone or seek any favours. Whatever happens today

could potentially have a huge impact on Samsung as well as the South

Korean economy. After all, it is the largest conglomerates in the

country. That is correct. It accounts for almost a fifth of the

economy. It is the biggest company in the country. Concerning Samsung,

they don't seem to be dented by the trial. They had record profits in

the last quarter. This verdict is not just about Samsung. There are

large conglomerates dominating the South Korean economy. In the past,

many of the head of this company group have been pardoned saying it

will be an economic impact. Now we have a new government which has

promised to clean up the economy. If Jay Y Lee gets a strong sentence

today, they are saying it will be a strong message to the large

conglomerates. OK. Watching the verdict due later in the afternoon

in the hour. A major overhaul of Qantas has paid off. In the last two

hours, they posted their second-best profit ever, slightly ahead of

analyst estimates. It cut staff by more than 5000 and reduced costs by

$2 billion to achieve that higher efficiency. I asked an analyst how

the company plans to hold on to those gains. You have raised the

right points. This is the first step in becoming future proof. It is not

cost savings, it is about setting the stage for being successful in

the future. It comes from a cost basis. What is yet to be found out

is whether they can drive a premium against other carriers. That can

only come through better service quality, high value, and taking

values into the international market from their national market. There is

speculation from unnamed sources they may also announce today along

with their result is what could we the longest flight in the world.

That is the non-stop Sydney to London route. It will be shorter

because it usually has a stop. What could that mean for Qantas? I like

the idea. Time-saving is something business travellers would value.

What does it mean for the airline? They could charge a higher premium

on the tickets. That comes with more energy efficiency and fuel

efficiency. That has to come together. If they can do this, I

believe this could be a successful route. A 20 hour flight. I don't

know if I want to do that. What does Qantas need to do to stay

competitive? What advice do you have? Offering free meals on a 20

hour flight, what could drive success in the long-run is giving a

premium across all of what the airline has to offer. That starts

had been Qantas, being a Streelman. -- with being. -- Australian. And

what are the benefits do they have against Middle Eastern carriers etc?

They have done this in local routs, donating food to food banks,

spending money on carbon offset programmes. I think they need to

improve a lot on that. Speaking to me earlier. There has been an

additional $3 billion of investment from SoftBank into Wiiwork. They

have already made almost one half billion dollars from investing in

the New York-based company as they set up shop in China, South Korea,

Japan and elsewhere in Southeast Asia. They rent out office space to

individuals and small companies like start-ups. Have you heard this? In

this world, nothing can said to be certain except death and taxes.

Those are the words of Benjamin Franklin. They are still true in

today's society. In many societies, death and taxes are given. But in

some places, they are not applied. I tax is good for business? -- are

taxes. In this series, two tax experts have gone head-to-head to

argue the pros and cons. I would say inheritance tax is could be the

economy. It puts money into the Treasury. -- is good for the

economy. But inheritance tax has built-in benefits for businesses. It

doesn't raise that much money. Half per cent of GDP. Now you get a tax

for only those people without knowledge to pay for accountants to

hide it for them. If people see 40% of what they leave will effectively

be taken by the revenue, it does not encourage them to live their lives

and spend. That is good for the economy. I think inheritance tax is

marginal to business. It does remove potential investment capital from

the economy. Relatively small businesses is what we are talking

about. A few hundred pounds is something you could invest in a

business. It could be reinvested. I don't think it takes away from

business. You could put it in the business. If someone has a lot of

cash, it will have that 40% inheritance tax. If they invest it

in their children's business, that is then converted into something

exempt. The regime can encourage investment in the business. I think

inheritance tax should be abolished. For the amount of revenue it raises

for the Treasury, it isn't worth it. I don't think it should be

abolished. It makes its contribution to the Treasury. It is an awful lot

better than some of the alternatives, effectively paying

more tax during your lifetime when you should be enjoying your money

and what you have earned. A contentious discussion. If you want

to join in, get in touch with us on #businessofdeath. People will be

watching the president of the European Central Bank today. They

will be listening for hints of shifting interest rate plans.

Representatives of international banks from 40 countries are all

attending this conference in the US State of Wyoming. These are the

markets. The Nikkei gaining slightly. That is because of a

weaker yen helping exporters. Australia is not benefiting from the

fact we saw Qantas reporting stellar results. In fact, they are slightly

lower as well, those Qantas shares. Wall Street ended flat. And that is

it for this edition of Asia Business Report. Thank you so much for