22/01/2018 Asia Business Report

A top story here in the UK, UKIP's

party members have unanimously

backed a vote of no-confidence in

party leader. Now, let's head over

to Asia Business Report with

Sharanjit Leyl. As Democrats and

Republicans struggle to reach a deal

that would end the government

shutdown, we find out what impact it

might have on the economy. And the

Malaysia town of Penang may not be a

household name but it is one of

Asia's tech capitals.

Hello and welcome to Asia Business

Report, I Sharanjit Leyl. The US

government shutdown enters its

second day and thousands of workers

have been ordered to stay at home as

politicians continue to battle over

immigration issues. Senate lawmakers

are holding a special meeting on

Sunday to try to end the budget

deadlock, and Dalla Porta has been

monitoring all the developments from

the newsroom. What is the latest?

Well, there is no deal yet but

lawmakers are hard at work on

Capitol Hill, trying to come to a

compromise to try and bring an end

to this shutdown. So we are seeing

some senators come out to say that

they are seeing signs of progress

but at heart, the heart of the

dispute has to do with a very

controversial deal over the Dhaka

programme, where undocumented

immigrants who came to the US as

children may possibly be deported if

they do not get legal protections

extended in March. And so, we are

going to see key vote at about 1pm

Eastern time, as to whether we will

see a quick and or prolonged

shutdown.

And which government

agencies do you think are going to

be most impacted if indeed there is

a prolonged shutdown?

Well, under

the Obama administration, which we

last saw a shutdown in 2000 betting

that lasted for about 16 days, and

we still quite a lot of services

affected them. The trump

administration has moved to try and

minimise the impact, having learned

from that. We will see things such

as the military, the Justice

Department, the courts, and even the

postal service continue as per

usual. As for the National Parks,

you will not be able to use restroom

if you visit some of them. We will

also see a fax to the White House,

most of the staff there will be put

on unpaid leave. That will affect

things such as Donald Trump's trip,

he is supposed to make a keynote

address on Friday but that is now up

in the air. In terms of the economy,

we are not expecting much impact as

it drags on for a long time.

And

what about impact on the markets? We

know that the Asian markets have

already opened.

So far, the Asian

markets are flat. Investors are

pretty much shrugging off the

investor turmoil, instead they are

focusing on corporate profitability

since we are in the middle of the

earning season, as well as the

outlook for the global economy.

Now,

Indian conglomerate Alliance

Industries expects its earnings to

increase further after hitting a

record in the third quarter. --

Reliance. It recorded a profit for

the first time ever and for more

now, we're joined by how Indian

business support Mumbai. Rather

surprising results for their

business, tell us why that is?

Absolutely, this is really

surprising. They came onto the

market in 2016 and it offered free

services for the first six months,

it is still offering very cheap data

plans and essentially free phones

for a small security deposit. So, no

one expected them to post profits so

far, but it has. Reliance has

invested $30 billion in this

business and has already posted

profits of around $70 million, but

what it has really done is it has

disrupted the telecoms market, and

it has affected a lot of other

companies. So, the company's

obviously buoyed by its oil

refineries, so it is expected to a

lot more in the telecoms market in

the months to come.

Now, we know

that India is just a huge telecoms

market, how is all of this impacting

the sect?

Absolutely. What Gioux has

done is it has really triggered a

price war and forced consolidation

in other companies -- GO. They have

posted six straight profits, Surrey,

a drop in profits for six straight

quarters. A merger will make it

India's largest telecom

conglomerate, so it has really

disrupted the telecoms sector

completely and caused a lot of

problems for other companies, which

say that GO's pricing is not fair at

all.

Fascinating stuff, thank you so

much for that. Now, in other news,

South Korea's exports in January

grew 9.2% from a year earlier, that

is according to the country's

customs agencies. Imports actually

jumped about 14.1% over that same

period. Semiconductors and

petrochemicals products drove

essentially that overall export

volume, and shipments to China rose

about 10%, while exports to Vietnam

grew a whopping 50%. Shares of

Toshiba are more than 2% in early

trade after reports that the company

is considering an IPO for its chip

unit if it does not receive

regulatory approval to sell it off

to a consortium. The sale is part of

a recovery plan for the troubled

Japanese electronics giant, which

narrowly avoided delisting from

Japan's main stock exchange. Now, it

is hard to think of anyone better

qualified to comment on China's race

with the US on artificial

intelligence leadership. What in

Taiwan, he was educated in the US

and worked as a scientist for both

Apple and Microsoft, before running

Google's China operation. And these

days, he is a Beijing -based venture

capitalist, investing in Chinese

artificial intelligence research. He

says he is concerned about

increasing protectionism.

AMA

globalist, I like to see everybody

worked together, but the growing

protectionism, nationalism, probably

most represented by President

Trump's administration, I think is

causing a world to contract and make

the border is stronger, rather than

weaker. It is regrettable but I

think it is unavoidable.

And that is

an artificial intelligence expert

there. Now, a little-known Malaysian

state is actually home to one of the

world's strongest manufacturing

technology hubs, Penang hopes to

follow in the footsteps of Silicon

Valley in California, where

engineers from big manufacturers

eventually left to strike out on

their own. In the first of a new

series, which is looking at Asia's

own Silicon Valley or tech hubs,

yes, we will be visiting a lot of

these different cities, we start

with Penang, to find out why it is

one of the nation's top cities for

start ups.

We took everything as one. When we

travelled to Singapore and even

Indonesia, many of them did not do

electronic hardware. Most of them

are in software, so with this, it is

very challenging for the start ups

there, if they want to build the

hardware product.

There was a golden opportunity for

tech start-ups, where many

multinational companies were looking

for a low-cost alternative to

automate their processes.

We thought that we should take the

opportunity and start our own

company. We wanted to build a great

technology for that in Malaysia, by

Malaysians, for the world.

We have a lot of engineers in

Penang, what we lack is

entrepreneurs. These people make

great, amazing products, but the

market it, that is one of the

biggest

There you go, Malaysia's Penang is

the first Silicon Valley. You heard

it here first, and of course, that

is it for this edition of Asia

Business Report. I am Sharanjit Leyl

in Singapore. Don't forget you