0:00:00 > 0:00:05A top story here in the UK, UKIP's party members have unanimously
0:00:05 > 0:00:11backed a vote of no-confidence in party leader. Now, let's head over
0:00:11 > 0:00:17to Asia Business Report with Sharanjit Leyl. As Democrats and
0:00:17 > 0:00:21Republicans struggle to reach a deal that would end the government
0:00:21 > 0:00:28shutdown, we find out what impact it might have on the economy. And the
0:00:28 > 0:00:33Malaysia town of Penang may not be a household name but it is one of
0:00:33 > 0:00:35Asia's tech capitals.
0:00:39 > 0:00:45Hello and welcome to Asia Business Report, I Sharanjit Leyl. The US
0:00:45 > 0:00:48government shutdown enters its second day and thousands of workers
0:00:48 > 0:00:53have been ordered to stay at home as politicians continue to battle over
0:00:53 > 0:00:57immigration issues. Senate lawmakers are holding a special meeting on
0:00:57 > 0:01:03Sunday to try to end the budget deadlock, and Dalla Porta has been
0:01:03 > 0:01:08monitoring all the developments from the newsroom. What is the latest?
0:01:08 > 0:01:12Well, there is no deal yet but lawmakers are hard at work on
0:01:12 > 0:01:16Capitol Hill, trying to come to a compromise to try and bring an end
0:01:16 > 0:01:21to this shutdown. So we are seeing some senators come out to say that
0:01:21 > 0:01:24they are seeing signs of progress but at heart, the heart of the
0:01:24 > 0:01:30dispute has to do with a very controversial deal over the Dhaka
0:01:30 > 0:01:33programme, where undocumented immigrants who came to the US as
0:01:33 > 0:01:37children may possibly be deported if they do not get legal protections
0:01:37 > 0:01:42extended in March. And so, we are going to see key vote at about 1pm
0:01:42 > 0:01:47Eastern time, as to whether we will see a quick and or prolonged
0:01:47 > 0:01:51shutdown.And which government agencies do you think are going to
0:01:51 > 0:01:56be most impacted if indeed there is a prolonged shutdown?Well, under
0:01:56 > 0:02:02the Obama administration, which we last saw a shutdown in 2000 betting
0:02:02 > 0:02:06that lasted for about 16 days, and we still quite a lot of services
0:02:06 > 0:02:09affected them. The trump administration has moved to try and
0:02:09 > 0:02:13minimise the impact, having learned from that. We will see things such
0:02:13 > 0:02:17as the military, the Justice Department, the courts, and even the
0:02:17 > 0:02:21postal service continue as per usual. As for the National Parks,
0:02:21 > 0:02:26you will not be able to use restroom if you visit some of them. We will
0:02:26 > 0:02:30also see a fax to the White House, most of the staff there will be put
0:02:30 > 0:02:37on unpaid leave. That will affect things such as Donald Trump's trip,
0:02:37 > 0:02:41he is supposed to make a keynote address on Friday but that is now up
0:02:41 > 0:02:45in the air. In terms of the economy, we are not expecting much impact as
0:02:45 > 0:02:51it drags on for a long time.And what about impact on the markets? We
0:02:51 > 0:02:55know that the Asian markets have already opened.So far, the Asian
0:02:55 > 0:03:00markets are flat. Investors are pretty much shrugging off the
0:03:00 > 0:03:03investor turmoil, instead they are focusing on corporate profitability
0:03:03 > 0:03:07since we are in the middle of the earning season, as well as the
0:03:07 > 0:03:16outlook for the global economy.Now, Indian conglomerate Alliance
0:03:16 > 0:03:19Industries expects its earnings to increase further after hitting a
0:03:19 > 0:03:28record in the third quarter. -- Reliance. It recorded a profit for
0:03:28 > 0:03:32the first time ever and for more now, we're joined by how Indian
0:03:32 > 0:03:38business support Mumbai. Rather surprising results for their
0:03:38 > 0:03:43business, tell us why that is? Absolutely, this is really
0:03:43 > 0:03:51surprising. They came onto the market in 2016 and it offered free
0:03:51 > 0:03:56services for the first six months, it is still offering very cheap data
0:03:56 > 0:04:02plans and essentially free phones for a small security deposit. So, no
0:04:02 > 0:04:10one expected them to post profits so far, but it has. Reliance has
0:04:10 > 0:04:13invested $30 billion in this business and has already posted
0:04:13 > 0:04:18profits of around $70 million, but what it has really done is it has
0:04:18 > 0:04:23disrupted the telecoms market, and it has affected a lot of other
0:04:23 > 0:04:31companies. So, the company's obviously buoyed by its oil
0:04:31 > 0:04:35refineries, so it is expected to a lot more in the telecoms market in
0:04:35 > 0:04:39the months to come.Now, we know that India is just a huge telecoms
0:04:39 > 0:04:47market, how is all of this impacting the sect?Absolutely. What Gioux has
0:04:47 > 0:04:51done is it has really triggered a price war and forced consolidation
0:04:51 > 0:05:05in other companies -- GO. They have posted six straight profits, Surrey,
0:05:05 > 0:05:11a drop in profits for six straight quarters. A merger will make it
0:05:11 > 0:05:16India's largest telecom conglomerate, so it has really
0:05:16 > 0:05:19disrupted the telecoms sector completely and caused a lot of
0:05:19 > 0:05:25problems for other companies, which say that GO's pricing is not fair at
0:05:25 > 0:05:31all.Fascinating stuff, thank you so much for that. Now, in other news,
0:05:31 > 0:05:37South Korea's exports in January grew 9.2% from a year earlier, that
0:05:37 > 0:05:40is according to the country's customs agencies. Imports actually
0:05:40 > 0:05:48jumped about 14.1% over that same period. Semiconductors and
0:05:48 > 0:05:51petrochemicals products drove essentially that overall export
0:05:51 > 0:05:55volume, and shipments to China rose about 10%, while exports to Vietnam
0:05:55 > 0:06:03grew a whopping 50%. Shares of Toshiba are more than 2% in early
0:06:03 > 0:06:07trade after reports that the company is considering an IPO for its chip
0:06:07 > 0:06:10unit if it does not receive regulatory approval to sell it off
0:06:10 > 0:06:17to a consortium. The sale is part of a recovery plan for the troubled
0:06:17 > 0:06:20Japanese electronics giant, which narrowly avoided delisting from
0:06:20 > 0:06:26Japan's main stock exchange. Now, it is hard to think of anyone better
0:06:26 > 0:06:29qualified to comment on China's race with the US on artificial
0:06:29 > 0:06:35intelligence leadership. What in Taiwan, he was educated in the US
0:06:35 > 0:06:39and worked as a scientist for both Apple and Microsoft, before running
0:06:39 > 0:06:45Google's China operation. And these days, he is a Beijing -based venture
0:06:45 > 0:06:48capitalist, investing in Chinese artificial intelligence research. He
0:06:48 > 0:06:55says he is concerned about increasing protectionism.AMA
0:06:55 > 0:06:58globalist, I like to see everybody worked together, but the growing
0:06:58 > 0:07:05protectionism, nationalism, probably most represented by President
0:07:05 > 0:07:11Trump's administration, I think is causing a world to contract and make
0:07:11 > 0:07:16the border is stronger, rather than weaker. It is regrettable but I
0:07:16 > 0:07:22think it is unavoidable.And that is an artificial intelligence expert
0:07:22 > 0:07:26there. Now, a little-known Malaysian state is actually home to one of the
0:07:26 > 0:07:32world's strongest manufacturing technology hubs, Penang hopes to
0:07:32 > 0:07:36follow in the footsteps of Silicon Valley in California, where
0:07:36 > 0:07:39engineers from big manufacturers eventually left to strike out on
0:07:39 > 0:07:43their own. In the first of a new series, which is looking at Asia's
0:07:43 > 0:07:49own Silicon Valley or tech hubs, yes, we will be visiting a lot of
0:07:49 > 0:07:54these different cities, we start with Penang, to find out why it is
0:07:54 > 0:07:57one of the nation's top cities for start ups.
0:08:30 > 0:08:40We took everything as one. When we travelled to Singapore and even
0:08:40 > 0:08:44Indonesia, many of them did not do electronic hardware. Most of them
0:08:44 > 0:08:50are in software, so with this, it is very challenging for the start ups
0:08:50 > 0:08:56there, if they want to build the hardware product.
0:09:18 > 0:09:21There was a golden opportunity for tech start-ups, where many
0:09:21 > 0:09:26multinational companies were looking for a low-cost alternative to
0:09:26 > 0:09:28automate their processes.
0:09:37 > 0:09:42We thought that we should take the opportunity and start our own
0:09:42 > 0:09:46company. We wanted to build a great technology for that in Malaysia, by
0:09:46 > 0:09:47Malaysians, for the world.
0:09:53 > 0:09:58We have a lot of engineers in Penang, what we lack is
0:09:58 > 0:10:02entrepreneurs. These people make great, amazing products, but the
0:10:02 > 0:10:04market it, that is one of the biggest
0:10:18 > 0:10:23There you go, Malaysia's Penang is the first Silicon Valley. You heard
0:10:23 > 0:10:28it here first, and of course, that is it for this edition of Asia
0:10:28 > 0:10:32Business Report. I am Sharanjit Leyl in Singapore. Don't forget you