06/02/2018

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0:00:05 > 0:00:08I'm Sharanjit Leyl with BBC World News.

0:00:08 > 0:00:09Our top story.

0:00:09 > 0:00:11Asian markets tumble after Wall Street suffers

0:00:11 > 0:00:17its largest decline in years.

0:00:17 > 0:00:21Japan's Nikkei is down by 4% after the Dow Jones closes down

0:00:21 > 0:00:23nearly 1200 points - its biggest fall since

0:00:23 > 0:00:26the 2008 financial crisis.

0:00:26 > 0:00:29The US Vice President Mike Pence is starting a trip to Asia

0:00:29 > 0:00:32which is meant to show solidarity with allies and help South Korea

0:00:32 > 0:00:36celebrate the launch of its Olympic Games on Friday.

0:00:36 > 0:00:40And this video is trending on bbc.com...

0:00:40 > 0:00:43Home surveillance video shows a dog sneaking a leftover pancake,

0:00:43 > 0:00:47but by doing so, the ignition button on the stove came on,

0:00:47 > 0:00:49causing something on top to ignite.

0:00:49 > 0:00:52Luckily the alarm system called first responders before

0:00:52 > 0:00:54the fire spread

0:00:54 > 0:00:57and a friendship ensued.

0:00:57 > 0:00:58That story is popular on BBC.com

0:00:58 > 0:01:00That's all from me for now.

0:01:00 > 0:01:06Stay with BBC News.

0:01:06 > 0:01:09And the top story here in the UK...

0:01:09 > 0:01:12The EU's Chief Negotiator warns the UK faces 'unavoidable' trade

0:01:12 > 0:01:14barriers - if it leaves the customs union and single

0:01:14 > 0:01:17market after Brexit.

0:01:17 > 0:01:25Now on BBC News, all the latest business news live from Singapore.

0:01:35 > 0:01:40Asian stock markets have lowered in the wake of two days of heavy losses

0:01:40 > 0:01:49on Wall Street.I am here at the Singapore air show as Asian

0:01:49 > 0:01:57countries beef up defence spending I have a lie in chief executive.--

0:01:57 > 0:02:05live interview. It is Tuesday, glad you could join us for another

0:02:05 > 0:02:10exciting addition of Asia Business Report. We start off with a very

0:02:10 > 0:02:17volatile and crazy global stock market. And the rout has deepened

0:02:17 > 0:02:20this Tuesday with Asian financial markets heading lower this morning

0:02:20 > 0:02:24on the back of heavy losses on Wall Street. This is where things stand

0:02:24 > 0:02:33at the moment. As you can see, the Nikkei is down by over 4%. The all

0:02:33 > 0:02:40ordinaries index is in the red by 2.6%. For a perspective on this

0:02:40 > 0:02:44sharemarket rout I'm joined now by our Asia business correspondent.

0:02:44 > 0:02:521000 points on the Nikkei today. This carnage, this fall continues

0:02:52 > 0:02:57from yesterday's rout.As we have been talking about all morning this

0:02:57 > 0:03:03has come about as a result of rather positive economic news coming from

0:03:03 > 0:03:08the United States. It must seem counterintuitive, right? Healthy

0:03:08 > 0:03:12economic growth in the US and the jobs market picking up with wages

0:03:12 > 0:03:17growing slightly and then all of a sudden money is being pulled out of

0:03:17 > 0:03:21a US dog market and correspondingly here in Asia. The reason for that is

0:03:21 > 0:03:27that as the economy strengthens in the US, the expectations for

0:03:27 > 0:03:32inflation, the price of goods going up, has increased. So traders are

0:03:32 > 0:03:36expecting the US Federal Reserve, the central bank Bear, to increase

0:03:36 > 0:03:41interest rates at a faster and 30 pace than they expected initially.

0:03:41 > 0:03:44That means the cost of borrowing goes up and things could come more

0:03:44 > 0:03:49expensive and money is buff pulled out of the stock market.It is a

0:03:49 > 0:03:56delicate balance. It is like investors wait, they are excelling,

0:03:56 > 0:04:01that moment has not happened yet. Many are probably selling as a

0:04:01 > 0:04:05result of the fact that they are up by so much. We have seen such a

0:04:05 > 0:04:09sharp rise in US stocks out here in Asia as well. Many people think let

0:04:09 > 0:04:14me get out now and enjoy some of that money. Go on a holiday, maybe.

0:04:14 > 0:04:18Another reason why people are selling is because other people are

0:04:18 > 0:04:24selling. A herd mentality? Exactly. There is a sense that maybe I should

0:04:24 > 0:04:28get out of the market could things could get worse. But many traders I

0:04:28 > 0:04:33have spoken to with a long-term 's perspective on US equities and Asian

0:04:33 > 0:04:37equities they say if you have a horizon of rival ten years these

0:04:37 > 0:04:42blips in the market should be seen as healthy correction, especially in

0:04:42 > 0:04:46the US market, many were concerned it was quite frothy and overvalued.

0:04:46 > 0:04:52The Dow Jones was up 31% since President Trump took over and you

0:04:52 > 0:05:00have the S&P 500 are by 23% and the Nikkei or at 26 year high as. The

0:05:00 > 0:05:03big test now is monetary policy from Asia-Pacific central banks.

0:05:03 > 0:05:06Australia today and then the Philippines and India later this

0:05:06 > 0:05:12week.When the US central bank had lower interest rates over the last

0:05:12 > 0:05:16ten years, Asian markets and the Asian economy were some of the

0:05:16 > 0:05:19biggest beneficiaries of that cheap monetary policy, the easy monetary

0:05:19 > 0:05:27policy. In reverse we now see that era disappearing. No-one should

0:05:27 > 0:05:31really be surprised, it has been signalled for a year or so. Central

0:05:31 > 0:05:35banks and governments now need to find a delicate balance, tweak their

0:05:35 > 0:05:39interest rate policies to make sure they do not prevent growth but are

0:05:39 > 0:05:45in step with the US at the same time.Thank you very much for that

0:05:45 > 0:05:50update on the business markets here in Asia. The share markets are

0:05:50 > 0:05:56wobbly and Bitcoin is showing even more volatility. The currency is

0:05:56 > 0:06:01falling over 15% on Monday, slipping below $7,000 for the first time

0:06:01 > 0:06:04since November. Meanwhile, a South Korean intelligence agency

0:06:04 > 0:06:08reportedly told the country's National Assembly that North Korea

0:06:08 > 0:06:13likely played a part in last month's massive theft from a Japanese

0:06:13 > 0:06:16cryptocurrency exchange service provider. Moving out of the

0:06:16 > 0:06:20Singapore air show and companies are planning to beef up defence spending

0:06:20 > 0:06:27an aircraft because of the South China Sea and North Korean ballistic

0:06:27 > 0:06:33missile threats. But who is buying, what are they buying and how much

0:06:33 > 0:06:47are they expected to spend? Joining me now is Mariko.Over 1000

0:06:47 > 0:06:52companies are here and we're not just discussing commercial airlines

0:06:52 > 0:06:58defence sector as well. We have seen robust growth in defence spending in

0:06:58 > 0:07:05the region. I have a little report, let's have a look.While most

0:07:05 > 0:07:10Western countries are slashing their defence budgets, many Asian budgets,

0:07:10 > 0:07:14governments are throwing money at it. China and India have doubled

0:07:14 > 0:07:20their spending in the last 20 years as well Southeast countries like

0:07:20 > 0:07:24Indonesia, Vietnam and a poor. Keeping some perspective here, the

0:07:24 > 0:07:28US still comfortably spend more on planes, missiles and tanks than

0:07:28 > 0:07:35anyone else. Over 600 and $40 billion last year. Asia now accounts

0:07:35 > 0:07:38for over one quarter of the world's defence spending. So what has

0:07:38 > 0:07:44changed? Simply, there are economies are growing and in this part of the

0:07:44 > 0:07:47world there is a lot going on. Think North Korea's nuclear missile

0:07:47 > 0:07:54threat. China's actions in the east and South China Seas. And

0:07:54 > 0:07:59insurgencies throughout South East Asia like the fighting in morale we.

0:07:59 > 0:08:02So what are Asian governments buying? -- fighting in the

0:08:02 > 0:08:06Philippines. There is investment in combat aircraft as countries expand

0:08:06 > 0:08:11and modernise their air force. And with the repeated tests by North

0:08:11 > 0:08:14Korea, many countries in north-east Asia are beefing up their ballistic

0:08:14 > 0:08:18missile defence. And while Asia is the biggest importer of weapons in

0:08:18 > 0:08:23the wild, countries such as China and South Korea are starting to

0:08:23 > 0:08:28become major arms exporters. It is not easy when your neighbours are

0:08:28 > 0:08:33increasing their defence spending. No country wants to be left behind.

0:08:33 > 0:08:39You will take a brave government in Asia to slow down. One company that

0:08:39 > 0:08:47is likely to benefit from that is Salas and I'm joined by their chief

0:08:47 > 0:08:54executive. Were talking about robust growth in defence spending in Asia.

0:08:54 > 0:08:57How has that affected your company and can we expect some announcement

0:08:57 > 0:09:04this week?Defence spending is have started to increase almost all over

0:09:04 > 0:09:10the world and in particular in this region.Why would it be? Is that

0:09:10 > 0:09:13because of growing economies all territorial disputes in the region?

0:09:13 > 0:09:20Yes. And this generates a greater need in terms of protection and

0:09:20 > 0:09:25safety.We have countries like China and India are doubling their

0:09:25 > 0:09:29spending in the last 20 years as well a South East Asia. Were

0:09:29 > 0:09:32starting to see some slow down. It is still growing but we are

0:09:32 > 0:09:36heartened to see a little slow down recently. Are you concerned about

0:09:36 > 0:09:40this lowdown in the region?Not really. We are acting on long-term

0:09:40 > 0:09:45contracts and our markets are long-term. We are not concerned at

0:09:45 > 0:09:52all.What kind of things are Asian countries interested in buying? In

0:09:52 > 0:09:57layman 's terms?As far as we are concerned, investment in their

0:09:57 > 0:10:06infrastructure. Aviation, air traffic control, high-speed lines,

0:10:06 > 0:10:13this investment is there to sustain urbanisation and globalisation of

0:10:13 > 0:10:18the world.And while Asia is still the biggest importer of of those

0:10:18 > 0:10:22weapons, countries like China and South Korea are starting to export

0:10:22 > 0:10:26as well. And Australia just announced they want to boost export

0:10:26 > 0:10:30as well. Are you worried that they could potentially pose a threat to

0:10:30 > 0:10:44your business?Not really because we are more local. We have seven or

0:10:44 > 0:10:48eight Singaporeans working here and we benefit from a highly talented

0:10:48 > 0:10:52base here in the region. We recruit the best engineers to develop a

0:10:52 > 0:10:59local solution for the market and for regional economies and markets.

0:10:59 > 0:11:04At this hour show we are seeing many of the latest technologies. Are you

0:11:04 > 0:11:08worried about cyber security?Yes and no. It is a direct consequence

0:11:08 > 0:11:15of digitalisation. We inject more and more artificial intelligence

0:11:15 > 0:11:19into our wine markets and as a consequence you need to deal more

0:11:19 > 0:11:25and more with cyber security.Thank you so much for joining us. That is

0:11:25 > 0:11:32all from us here at the Singapore airshow. Join us later. She will be

0:11:32 > 0:11:35joining us all week from the Singapore airshow and we are looking

0:11:35 > 0:11:40forward to that. A quick look now at the Asian market. A big hit after

0:11:40 > 0:11:44overnight falls in the United States. Thank you so much for

0:11:44 > 0:11:50investing your time with us. Sport Today is coming up next.