29/08/2017 Asia Business Report

Rishart Masierak is charged with causing death or serious injury

by dangerous driving and causing death by drink driving.

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

North Korea rattles the market after launching a missile over northern

Japan. As tropical storm Harvey batters the production hub in the

US, we will look at the impact on the industry. Bit's Tuesday, good

morning, Asia. Hello, world. Glad you could join us. -- it's. A

missile flew over northern Japan before catching into the sea. --

landing in the sea. The Japanese government says this latest missile

launch is a threat that Tokyo will respond to firmly. They call it a

clear violation of UN resolutions. The Asian markets have opened, and

for the reaction on how it will be trading, we are joined by my

colleague. What's happening? Japan, Australia and China have opened

lower, Japan and a four-month low. Similar conditions in South Korea.

Not down by a huge amount. With the Japanese yen, it is rising to a high

against many currencies including the US dollar, because it is seen as

a safe haven for investors in times of crisis. It seems that this

reaction, it does seem somewhat unusual and overblown. What we saw

this time around was a missile going over Japan. This happens

infrequently. It has only happened twice in the past. At the time that

there were previous launchers over Japan, they were claimed to be

satellite launches. People are waking up to alerts on television

and sirens, it was quite a tense time before the all clear was given.

That is part of the reason that markets would have been rattled. In

the middle of August, we saw a war of words intensifying between

Washington and Pyongyang. That was when Donald Trump used the words

fire and furious. Pyongyang retaliated saying they would launch

a missile to Guam. We saw then a huge impact on the Korean markets,

they fell one and a half %. Experts suggest that this geopolitical

uncertainty creates volatility in the markets but has no big long-term

impact. This is seen as more provocative than the other missile

launchers, we are waiting for a response from Donald Trump on this

latest launch. Tropical storm Harvey has not let up, it has left very bad

flooding and it is expected to stay around the coast of the Gulf of

Texas for the next few days. Houston is the heart of the US energy

industry. Here is how oil prices are faring in early Asian trading. They

are both up. The markets are not responding the way they usually do,

gas futures have hit a high while crude oil prices fell. I asked why.

You have to think about oil as a value chain, crude oil goes in as

fire and comes out as a distillate. The bottleneck is the 200 bottles

capacity per day that has gone off-line in Texas. Gasoline prices

are surging to a high of 7%, could this put more pressure on prices at

the pump? This could have a knock-on through other parts of the world.

Other parts of the world cannot move refined products from one part of

the country to others when they need to, they may need to look overseas.

Could we see higher gasoline prices in Asia because of refineries being

shut down? That could last for a week? If we saw a long shot down in

the Texas region, prices could go up slightly. Americans will need to go

to overseas refineries, namely Asia, to source those products. Is there

still enough global capacity with potentially US refineries being shut

down? There is definitely enough capacity, but there is not enough in

the right place. You can refined products, but it is not in optimal

places around the world. In other business news headlines, Samsung is

expected to invest $7 billion over the next three years to build a new

memory chip production facility in China. Analysts say the tech giant

accounted for almost 40% of flash memory chip revenue. China is trying

to produce its own, but it is likely to be several years before they can

compete with existing manufacturers like Samsung. Infosys shares rose

after the CEO returned as chairman. It was seen as a victory for the

company. They waged an acrimonious battle with the board for months

over alleged corporate governance lapses. Indonesia is facing a

shortage of salt. Many would assume that all of that seawater makes it a

natural producer of salt, but the government has significantly

increased imports this year, including 75,000 tons from

Australia. Here is a look at what is causing a shortage.

Indonesia uses around 4.1 million tons of salt per year. That is

primarily used in households, the rest by industries. Production is

not meeting demand. There is a shortage of 2.2 million tons. That

is the weight of 550,000 Sumatran elephants. The weather last year was

quite extreme. That had an impact on local production. The way we produce

salt is still very traditional, which makes it hard to improve our

quality. It is not just Mother Nature being blamed. Indonesia's

minister of maritime affairs is suggesting cartels may be behind it.

Authorities have uncovered cases where import is brought in more they

could dump Mac than -- than they could use, and have

sold it on to companies. It is not sufficient to meet their

needs. This would only be a temporary solution. Over the

long-term, the government have to regulate the industry. That could

encourage more producers, allocating more land in eastern Indonesia to

increase the land allocation for that salt, that could increase

supply. If the government deregulates the industry, are we

likely to see prices coming down from current levels? In China, they

have deregulated the salt industry. That would mean that the government

would not be controlling the quota all the retail price of salt. It

would not decide the prices of salt based on transportation costs and

the quality. There is a better way of ensuring supply of salt to

people. Thank you for investing your time with us. Goodbye for