01/08/2013 World Business Report


01/08/2013

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Those are the latest headlines from BBC World News. Now for the latest

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financial news with Sally. Can the turnaround at Sony continue?

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Investors await the latest quarterly results amid calls from one

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shareholder for the company to be split up. Does Europe need another

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interest rate cut? Welcome to World Business Report. I'm Sally Bundock.

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Also in the programme, unexpected growth at China's big manufacturers.

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We'll have the details. What do these two have in common? Or at

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least, these three? The answer is Sony. 'Smurfs 2' is the latest

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release from Sony Pictures, owned by the corporation behind the Xperia

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smartphone, Bravia TVs and, of course, the PlayStation. In the next

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results, some analysts are only expecting it to break even in the

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three months to June. That would be a big let-down from the previous

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quarter when it made almost a billion dollars, returning to profit

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for the first time in five years. That could add weight to calls by

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one leading investor for the company to be split up, as Rupert Wingfield

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Hayes reports from Tokyo. Can the little blue men from Belgian

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rescue Sony? Sony pictures is hoping papa smirks and the game can do

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better than some of its other stars this summer. -- papa Smurf. That

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dahlias have prompted their largest shareholder to call for the division

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to be sold off. They have accused the company of treating its

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entertainment division like a redheaded stepchild. Sony's boss

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disagrees. He believes Sony's entertainment divisions are vital.

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After years of losses and poor product losses. Sony 's smart

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phones... The launch of the PlayStation four. As soon as we hear

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from Sony, we will update you. It's been the longest recession to hit

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Europe since records began two decades ago but is it finally coming

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to an end? That's the key question for the European Central Bank as it

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makes its policy decision later today. Interest rates are at a

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record low of 0.5%. ECB chief Mario Draghi said the Bank discussed

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cutting them even further last month. Since then there have been

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some encouraging signs. The number of people out of work in the

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countries that share the Euro fell by 24,000 in June. That was the

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first monthly fall in over two years. However, to put that in

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perspective, there are still 19 million unemployed in Europe. That's

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one snapshot of what is happening in the region. Bronwyn Curtis is Chair

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of the Society of Business Economists. What will the ECB do

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today? They have to keep interest rates low in Europe. The

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unemployment rate is still going a little higher. It's great, but it is

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not enough to get those debt levels down. It's probably going to be half

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that because the call will start to slow down. It is a real problem

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-- core. They'll have to put more liquidity in. It does look as though

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they will start withdrawing liquidity from the US. In the

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meantime, when you're looking at some of the key economies in the

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eurozone that we are concerned about, Greece, Portugal, Italy, when

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you look at the politics, what's going on in these countries, it's

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getting very difficult. Allegations about Mariano Rajoy. Things seem

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unstable. It's getting more and more difficult. These governments, you

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talked about Greece, Spain, they are all hanging on by a thread. Its

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austerity. People are getting tired of it. It doesn't look as though any

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of the banks are going to have to collapse. Things are OK. Thank you

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very much. She will return shortly. Let's move on. We have some good

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news. A bit of relief on financial markets coming from China. An

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official survey of manufacturing activity, known as the Purchasing

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Mangers Survey or PMI, shows growth picked up slightly in July from

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June. Most analysts were expecting a contraction in factory output. Let's

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go straight to Rico Hizon in our Singapore bureau.

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Put this in perspective. Any number below 50 indicates a

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contraction in factory activity. The official figure was just up a little

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bit from the month before. You also have sums -- have some sceptics. We

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have that private reading of the mainland private factories. It was

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at an 11 month low. 48 .7. That is indeed a contraction. It could

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potentially be the solution in entering the sector's problems. At

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the moment, China's economy is not out of the woods.

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We continue to watch that closely. Turning to bricks and mortar, if you

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are looking to own real estate, Singapore is the fourth most

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expensive city in the world, after Hong Kong, London and Monaco. And

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now the Singaporean government has decided to introduce tougher

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measures to cool the property market. In today's instalment of our

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global series on housing, Sharanjit Leyl takes a look at the efforts to

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control Singapore's spiralling prices.

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He lives with his wife and daughter in this five bedroom, 7000 square

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feet penthouse in Central Singapore. He thinks it would cost about $11

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million if he were to sell it. He plans to stop buying any more here.

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They've stabilised the property market. When they say they are going

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to stabilise it, they will. At the same time, I will hold on to the

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portfolio I have here. government has tried to bring down

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house prices by raising the stamp duty. Coupled with expectations of

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rising interest rates and rising mortgage payments, has people

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worried that prices will fall. Developers bank on more demand from

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buyers. There has been so much demand that property prices hit a

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record high in the last quarter. They are paid measurement in place

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for the last four years. They have put in even tougher ones in the hope

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they will work. These include trying to stop borrowers from making

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monthly payments. A hint of concern that Singapore might experience a US

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style mortgage meltdown. We have to look out for the right

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opportunities. We have been fairly prudent to our approach in investing

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