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tv   Asia Business Report  BBC News  August 21, 2018 1:30am-1:45am BST

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reunited for the first time in at least 65 years. a group of elderly south koreans travelled to a tourist resort in the north for the event. the korean war in the 1950s left the peninsula divided, and many on the northern side were unable to leave. pope francis has written an unprecedented letter condemning child sex abuse and cover—ups in the catholic church. the 2,000—word letter is addressed to the world's 1.2 billion roman catholics. and it has been back to basics at london's gatwick airport. staff had to write flight information on whiteboards for most of the day due to a technical problem. the airport says the issue has now been resolved. that's all. stay with bbc world news. and the top story in the uk: birmingham prison is being taken over by the government from the private firm gas, after inspectors said it had fallen into a state of crisis. the ministry ofjustice is accused
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of being asleep at the wheel. now on bbc news, live to singapore for asia business report. more rhetoric on us china trade talks. president trump says he doesn't expect much to come out from the negotiations with china on tariffs, but one family run business in singapore is caught in the crossfire of this trade war. we look at how small businesses across asia are coping. and the world's biggest mining company, bhp billiton, so a 37% drop in net offered ability. find out what dropped earnings lower. —— net profitability. good morning, asia, hello, world. it is a tuesday. glad you could join us for another exciting addition of asia business report. i'm rico hizon. we
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start off the programme with us china trade talks and american companies affected by washington's trade war with china are getting the chance to speak up this week. overnight, government officials started public hearings on the next set of tariffs that president trump has threatened to impose on chinese goods, this time worth $200 billion. with tariffs on more goods coming into effect on thursday, this brings the total amount of goods subject to ta riffs the total amount of goods subject to tariffs on both sides to $50 billion us. as the dispute continues, it is not just china us. as the dispute continues, it is notjust china or the us that is affected. asian economies are intricately linked to china's fortunes. many made in china products have components from other countries, and so what hurts beijing hurts countries further afield like south korea, taiwan or singapore. our asia business correspondent has the full details. in the 50 years he has run this business, this man
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hasn't seen anything quite like this. he and his daughter, joyce, are trying to figure out how their family business can avoid becoming a potential casualty of the us china trade war. they make speakers in this factory in singapore, and also have factories in vietnam and china. the worst case is you impose a 25% tariff... now they have found out that the equipment they make on their chinese factory is on the latest list of chinese goods the us is targeting. if these tariffs come into effect, their chinese made speakers could be up to 25% more expensive for american customers. we are sandwiched. we have a little voice, our voices were probably drowned out. hopefully it finds its way to somewhere, and this threat will cease, but we're not sure. anything can happen so as a business we have to be prepared for the worst. the predictions are dire. singapore alone could see up to a
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percentage point of its economic growth shaved off this year if these tensions turned into an all—out trade war and around the region the numbers are almost as bad. but, as singapore's trade minister told me, the bigger threat to the global economy is lurking in the background. if global confidence is shaken, if this impacts it negatively and everyone withholds their investment, then i think we will suffer quite serious consequences for the entire global economy. international trade, consequences for the entire global economy. internationaltrade, goods being manufactured and moved across the world, has been the lifeline not just for singapore but this entire region. it has transformed asia from an economic backwater into being front and centre on the world map of trade. but now, asia is stuck in the middle, caught up in a fight between the world's two superpowers, and all businesses here could do is stand on the sidelines and watch. well,
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shipping is often an early bellwether of how an economy is doing. currency and stock markets can also be indicators. some publicly listed companies are beginning to warn investors that future profits might be affected. let's find out more with our next guest, who says we are seeing more companies race for the impact of tariffs. we are actually seeing companies that investors haven't thought that they might get in, it impacted, warning the outlook of wea ker impacted, warning the outlook of weaker earnings due to the tariffs coming in in september, and some of them even talked about potentially moving their operations back to the us, should there be prolonged or increased tariffs further down the track. of course, so far it is really the impact from september.m a portfolio manager, where do you see the opportunities in this environment? is it time for investors to buyback or abandon
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stocks on our? look, there will be a lot of volatility is, however i do feel if investors take a slightly longer term view, you will find a lot of good opportunities, especially with china exposed stocks. they are offering very good structural growth regardless of the trade war. so do pay attention and find you're buying opportunity. the world's largest mining companyjust reported a 37% drop in its net profit for the year. bhp was hurt by impairments related to costs associated with the mining disaster in brazil, and it did too well from the sale of its assets to rival bp. taking a look at the industry, two forces looking at oil prices, the threat of sanctions on iran and the escalating trade war between america and china. on thursday we will be hearing how china's largest oil refining company is holding up against the pressure on both ends
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when it reports half yearly results. let's find out more with an investment director. he talked to us about the problems of bhp billiton. i think ever and is disappointed given that three out of the four businesses they had had a really good pricing environment. they are involved in base metals, coal and oil. all those three businesses should have done really well given that prices are up 20% from where they were in the previous period. all right, but they can indeed bounce back despite these issues. they are a large company. taking a look at other earnings around the region, you have sinopec. what are you expecting from the chinese oil company? generally i think refiners are ina company? generally i think refiners are in a good position, especially in china. refining margins in china area in china. refining margins in china are a very decent levels where they can makea are a very decent levels where they can make a ton of cash. i think it is sort of driven by two things. one
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is sort of driven by two things. one is just the rapid is sort of driven by two things. one isjust the rapid pace of is sort of driven by two things. one is just the rapid pace of the chinese economy. it has grown at such a rapid pace in the past couple of years. that is basically supporting the demand for all the products that sinopec sells, gasoline, diesel and the rest of it. and today we have seen oil prices continuing to rise, despite all of these trade tensions between the united states and china. yes, so the other side of it is basically the supply side. so basically the iran sanctions, which, you know, if they go through, they prevent anybody who wa nts to go through, they prevent anybody who wants to do business with the us to stop buying in —— iranian exports. donald trump has trumpeted the state of the us economy under his leadership. indeed, much of the us economy has boomed during the trump administration. ouraverage
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economy has boomed during the trump administration. our average people really feeling the benefits? my colleague has been looking at one number that seems stuck, potentially holding down the american consumer. we have the greatest economy we've ever had. we have the best numbers, where setting records in every respect. the us economy is booming, the president is right about that, but our average americans feeling any of the benefit? wages for the first time in18 any of the benefit? wages for the first time in 18 years are rising again. wages have been stagnant for decades but let us look at the last five years. overall a decent picture, some ups and downs but it is generally. in fact, since last year, wages are up is generally. in fact, since last year, wages are up 2.7%. we have so manyjobs coming in, but they are raising wages. here is the problem, thatis raising wages. here is the problem, that is what we call nominal wage growth, where they haven't factored in inflation. average prices for
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consumers have gone up in inflation. average prices for consumers have gone up 2.8%, so while the numbers on americans' paycheques might look like they are going up, when you factor in cost wages are effectively flat. let's look at that nominal wage growth graph again. now let's adjusted for inflation. it is not a good look. our economy is soaring, and we are creating opportunity for everyone. so what is driving up prices?” creating opportunity for everyone. so what is driving up prices? i am for massive oil and gas, and everything else, and a lot of energy. it is mainly oil prices. they have shot up in part because of the situations in venezuela and the middle east. and then there is the iran deal, with trump pulling out of it and slapping new sanctions on the country. it is likely global supplies of oil will be tightened further, driving up prices at the pump and in the checkout. further, driving up prices at the pump and in the checkoutlj further, driving up prices at the pump and in the checkout. i have been here a little more than 1.5 yea rs been here a little more than 1.5 years and we have had record numbers. we have had numbers that nobody believed possible. so the best numbers, i guess it depends on which ones you are looking at. let's
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have a quick look at the markets before we go. currently it is a mixed bag, the nikkei 225 down by 128 points, but south korea is up by zero point one. mac —— 0.1 of a percent. consumers continue to wait policy versus us china trade negotiations which start today. thank you for investing your time with us. i am rico hizon. sport todayis with us. i am rico hizon. sport today is coming up next. see you soon. this is bbc news. the top stories this hour: reunited after decades apart. emotional reunions for south koreans meeting their relatives in the north. and a break in the monsoon rains has allowed rescuers to step up their relief efforts in kerala, where more than 400 people have died. gatwick airport says a problem with its flight information screens which led to some passengers missing theirflights
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has been fixed. staff were forced to resort to marker pens and whiteboards to provide departure details. jon hunt reports. this is how the airport was telling passengers which gate they needed to go to the board their flight today. the digital information screens went blank after a data cable was damaged. passengers gathered around a whiteboard as staff updated the status of flights with marker pens. some had problems checking in their bags and printing boarding passes. when we arrived at the paper machine to print the boarding pass, it didn't work. so we wait, we wait, we ask five persons, that we will miss ourflights, ask five persons, that we will miss our flights, and they didn't do anything. so we missed ourflights. it seems like a lot of the kiosks we re it seems like a lot of the kiosks were down, and there just wasn't
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enough people to manage everyone who needed tickets, sol enough people to manage everyone who needed tickets, so i ended up missing my flight and they told me that i needed to get on the next one, so i'm waiting in line to make that switch. how do you feel about that? really frustrated. iwas looking forward to a relaxing vacation in italy so it is not after a good start. the issues began in the early hours of this morning, affecting the first wave of flights from 4:35a.m.. affecting the first wave of flights from 4:35 a.m.. screens at both the north and south terminal were affected. around 200 people miss theirflight affected. around 200 people miss their flight because of the confusion with departure times. for the departure screens to fail in the early hours of this morning and to jeopardise the first wave of outbound flights is, i'm afraid, another technical embarrassment the gatwick airport. i guess the best thing is that only 200 people miss theirflight, thing is that only 200 people miss their flight, although they must be mightily cheesed off. the display screens started working again this afternoon. gatwick airport has apologised, as has vodafone, which
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provides the airport's it systems. it isa provides the airport's it systems. it is a problem both gatwick and its passengers could have done without, as the airport sees its busiest summer ever. much more on the bbc news website on those delays at gatwick. now on bbc news, sport today. hello, this is sport today, live from the bbc sport centre. coming up on this programme: its 100% start to the season forjurgen klopp's liverpool, as they see off crystal palace with a 2—0 win. frustration for diego costa, as atletico madrid kick off their la liga campaign with a draw at valencia. captain kohli shines again as india leave england with a mountain to climb. hello and thanks for
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joining us on sport today. we start with football, and liverpool have made it two wins out of two at the start of the new english premier league season. they won 2—0 at crystal palace on monday, and are one of six teams who've made a perfect start to the new campaign. liverpool took the lead when their captain james milner scored with a penalty on the stroke of half—time. the spot kick was awarded for a clumsy challenge by mamadou sakho on mohamed salah. palace were reduced to 10 men when aaron—wan bissaka was sent off 15 minutes from the end. and set up sadio mane for the goal which sealed a 2—0 victory. the class that as a three points? great three points, great game, i am not sure what you want to

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