:00:00. > :00:15.Now on BBC News, all the latest business news live from Singapore.
:00:16. > :00:26.Japan's Prime Minister, Shinzo Abe, welcomes Theresa May to Tokyo. Will
:00:27. > :00:33.North Korea overshadow trade negotiations? From bicycles to
:00:34. > :00:40.football, we look at where -- whether the sharing economy has gone
:00:41. > :00:44.too far. It is Wednesday, everyone. Glad you could join us for this
:00:45. > :00:48.edition of Asia Business Report. I am Rico Hizon. As we mentioned in
:00:49. > :00:52.the headlines, UK Prime Minister Theresa May is in Japan from today
:00:53. > :00:57.for a three-day visit. Before we get to that story, let's check out the
:00:58. > :01:02.state of the world's third-largest economy. Here is our Asia business
:01:03. > :01:06.correspondent. About a year ago, the economic news coming out of Japan
:01:07. > :01:09.was still pretty gloomy. After all, this was a country which struggled
:01:10. > :01:12.with falling prices and slower growth since the stock-market
:01:13. > :01:17.collapsed company bubble in the 1990s. But now things might be
:01:18. > :01:23.looking up. What has given Japan's economy this bounce? Low
:01:24. > :01:27.unemployment is helping wages to grow just a little bit more quickly,
:01:28. > :01:32.and that means more cash in people's pockets to spend. Consumer spending
:01:33. > :01:37.makes up more than half of Japan's economy. And there is more. The
:01:38. > :01:40.Tokyo 2020 Olympics are just around the corner. The government is
:01:41. > :01:44.spending billions on new stadiums and it has already seen a rise in
:01:45. > :01:48.tourist numbers. And then there is exports. While they did fall
:01:49. > :01:52.recently, they are going strong so the stuff that Japan is well known
:01:53. > :01:56.for making like smartphones, cars and memory chips is in demand all
:01:57. > :02:02.over the world. But alarm bells ahead. The Japanese currency, the
:02:03. > :02:09.yen, is getting stronger, making Japan's stuff more expensive to buy.
:02:10. > :02:14.So does this all mean that Abenomics, the economic policies of
:02:15. > :02:18.Shinzo Abe to jumpstart Japan, are actually working? Well, to a point.
:02:19. > :02:21.Japan might be having its best run for a decade but that level of
:02:22. > :02:26.growth is not that impressive when compared to other developed
:02:27. > :02:30.economies. One of its biggest names, Toshiba, is at risk of becoming a
:02:31. > :02:34.zombie company propped up either State and the ageing population and
:02:35. > :02:38.shrinking workforce are fundamental problems for Japan that economics
:02:39. > :02:44.alone will not be able to fix. As she mentioned about Shinzo Abe, he
:02:45. > :02:48.will be hosting his UK counterpart, Theresa May, who will be in Japan
:02:49. > :02:51.starting today for a three-day visit. Tensions surrounding North
:02:52. > :02:55.Korea could rank high on the agenda and both sides could also be looking
:02:56. > :03:03.at ways to boost trade post Brexit. Last year the UK exported 50 billion
:03:04. > :03:09.US dollars to Japan -- 15 billion US dollars, while imports amounted to
:03:10. > :03:13.$14 billion US. Japanese investors have invested $52 billion in the UK,
:03:14. > :03:20.across various industries including banking and autos. Britain is home
:03:21. > :03:24.to 1000 Japanese companies, employing 140,000 people. Earlier I
:03:25. > :03:29.spoke to senior economist Martin Schulz about the importance of their
:03:30. > :03:32.relationship. The UK is clearly the most important country in many ways
:03:33. > :03:36.for the Japanese economy and for Japanese investors. Most
:03:37. > :03:39.headquarters of companies are sitting in London. Finances
:03:40. > :03:47.really... The international finance hub for Japan, as well. An overall,
:03:48. > :03:50.the idea in Japan is that the domestic economy is booming, a
:03:51. > :03:55.growing beyond potential. They want to invest in the euro and the UK is
:03:56. > :04:00.still an important hub for Japan. It is important, but we now have the
:04:01. > :04:04.Brexit negotiations. Will the Japanese agreed to discuss a free
:04:05. > :04:11.trade agreement with the UK sooner rather than later? Well, this is
:04:12. > :04:15.really the most important point. Mrs May will have to explain to Japan,
:04:16. > :04:20.to investors and the government, what is the future plan? How will
:04:21. > :04:25.she support businesses in the UK? How can the UK actually do better
:04:26. > :04:30.outside the EU? This is very hard to grasp for Japanese businesses
:04:31. > :04:36.because Japan has just negotiated an EU Japan FDA, so they are joining
:04:37. > :04:39.the market while Japan is leaving a very difficult situation. Mrs May
:04:40. > :04:44.will have a great deal to do. The mood is calm but the big question is
:04:45. > :04:46.how to move on. You deal with a lot of Japanese businesses on the
:04:47. > :04:52.ground, Martin. What are these businesses sceptical about? By
:04:53. > :04:59.joining a free trade agreement with the UK? Well, it is legally
:05:00. > :05:03.impossible. That is a problem for the Japanese government, because,
:05:04. > :05:07.well, the UK is still technically part of the EU, so they can't
:05:08. > :05:11.negotiate outside. But more importantly, there will be indirect
:05:12. > :05:15.talks. There will be talks about future plans. But overall Japan is
:05:16. > :05:22.now focusing on the all-important EU Japan FDA, is not to disturb
:05:23. > :05:26.anything on that side, and it is moving on businesses. They want an
:05:27. > :05:30.internal plans, they want to know the future plans of the government
:05:31. > :05:35.in the UK, as an investment hard in Europe. Martin Schulz in Tokyo.
:05:36. > :05:40.Shifting our attention to the aviation industry and Chinese
:05:41. > :05:45.carriers are having to way politics over profitability. The big three,
:05:46. > :05:53.China Southern, China Eastern and air China, are out soon. Will events
:05:54. > :05:58.in the world cause a dent in that online? As they pressure South Korea
:05:59. > :06:02.over its deployment of a missile defence system. Joining me is my
:06:03. > :06:06.colleague. Will the South Korean tourism industry really have an
:06:07. > :06:13.impact on the bottomline of these Chinese carriers? Yes, it will,
:06:14. > :06:20.because it is a case of politics over profits. Essentially China's
:06:21. > :06:23.big three Allied is a China Southern, China Eastern and Air
:06:24. > :06:27.China. Let's take a look at a graphic illustrating the size of
:06:28. > :06:31.each. They are Asia's three largest airlines in terms of their fleet
:06:32. > :06:34.size and the sheer number of passengers they carry. China
:06:35. > :06:39.Southern is the largest, carrying over 70 million passengers this year
:06:40. > :06:47.as of July, with over 500 veins in the F. China Eastern follows with 63
:06:48. > :06:51.million passengers. -- 500 planes in the air. Finally Air China, which
:06:52. > :06:57.flew 57 million people with just a fleet size of 400 planes. You can
:06:58. > :07:01.imagine, with the sheer size of these airlines, you would think they
:07:02. > :07:06.would report fairly good profits. Actually they have reported a fairly
:07:07. > :07:09.mixed bag. Yesterday we saw decent earnings from China Eastern, which
:07:10. > :07:15.saw its first half profit rise. That was really on the fact that they had
:07:16. > :07:20.a 1-off sale of a logistics unit. A stronger Chinese currency, as well,
:07:21. > :07:24.the yuan. China Southern recorded an 11% fall in first half profit, due
:07:25. > :07:28.to higher fuel prices and lower returns on its international
:07:29. > :07:32.flights. That is where we get to South Korea. They had to cut their
:07:33. > :07:36.flights to South Korea after Beijing banned tour groups from visiting
:07:37. > :07:43.there. The cuts came as China began to pressure South Korea over Seoul's
:07:44. > :07:46.deployment of a missile defence system, the THAAD, designed to
:07:47. > :07:51.thwart North Korean attacks. China sees it as a threat to its own
:07:52. > :07:56.security. That is what I meant what I said politics over profits for
:07:57. > :07:59.these guys. Many headaches for these Chinese carriers, massive fleets but
:08:00. > :08:05.not many passengers. Thank you for joining us. Moving on to other
:08:06. > :08:08.business news making headlines, Uber says it is cooperating with a
:08:09. > :08:11.preliminary investigation by the US Department of Justice into possible
:08:12. > :08:16.allegations of bribing foreign officials. It is unclear whether
:08:17. > :08:20.authorities are focused on one country or multiple countries where
:08:21. > :08:26.the carrier operates. It is the latest legal problem right hailing
:08:27. > :08:29.giant faces as they await their new chief executive taking over the
:08:30. > :08:33.reins. And what is yours could also be ours, that is the thinking of the
:08:34. > :08:36.sharing economy taking off in various parts of the world,
:08:37. > :08:41.including China. How far would businesses go to push the sharing
:08:42. > :08:52.concept? Our correspondent looked around the Chinese city of Beijing.
:08:53. > :09:01.But what about ball sharing? The company behind this venture planned
:09:02. > :09:03.to make 20 million footballs and basketball is available for hire
:09:04. > :10:16.across China. -- basketballs. That is very unique, exercising on a
:10:17. > :10:22.treadmill in the middle of the street. That is the sharing economy
:10:23. > :10:25.in China. That is it for this edition of Asia Business Report.
:10:26. > :10:31.Thank you so much for investing your time with us. I'm Rico Hizon in
:10:32. > :10:34.Singapore. Sport Today is coming up next.