♪ >> the asia-pacific braces for declines red by miners -- led by miners and energy. >> blowout payroll numbers on friday. a private survey this morning sees the most jobs added in three years. >> hard to swallow. her she's the comes the first american company drawn to beijing. >> the fastest-growing economy in asia to read we are alive.

>> this is the second hour of daybreak asia from bloomberg's u.s. and asia headquarters. >> it is just after 7:00 p.m. here in new york. i am betty liu. we are marching ever closer to the friday jobs report here in the u.s.. some see it as the last data points before we get the fed decision next week. it could swing either way. ifit is bad, i do not know that 100% chance holds. >> i know the correlations are not strong. but that adp report was a blowout figure. all but solidified this was 100% when it comes to the fed it next week to read also watching oil very closely. at $50, that hid the energy players in australia. with check out the market sophie. >> oil producers in focus given that 5% drop in wti overnight.

we have the nikkei and the kospi coming online. the nikkei 225 snapping a four-day drop, up 4/10 of 1%. a lot of focus given what is happening. toshiba has concerns about chip sales. asahi reporting it may not meet its earnings update by march 14. over on the kospi, up 1/10 of 1%, extending its gains for a fourth day. geopolitical risks for china and its neighbor to the north. 200 marginally lower. this cut the regulation with a proposed deal. a quick check of oil prices and the yen are playing out. that 114.42.

this is cap, the dollar-yen, since the start of february. we see momentum gaining ground. of of $50. willould it go above, that make it interesting for markets, given that reflation story. likely toices are have strengthened again in february according to surveys. let's bring in our china correspondent, tom mackenzie, with the preview of the numbers do in the next hour. we saw those trading numbers yesterday. they were described as bizarre. can we see any disappointment here today? tom: let's not be fooled. these numbers may come as a surprise. but what we are expecting is a 7.7% increase for the producer price number. we have a terminal that shows what is going on. we have deflationary prices and those were placed by gradual

price hikes at the factory gates. toward the end of last year we had five straight increases in the factory date prices. if we do get that 7.7% number, that will be the biggest spike since 2008. and the consumer price number coming up versus an increase of 2.5% in january. there were seasonal effects. in terms of what this means for the overall inflation picture, bloomberg intelligence says of the pboc will be relatively relaxed until that feeds into the consumer number. intelligence do not expect a rate hike from the pboc. they will be saying when on these number -- sanguine on these numbers. supportand backing up for free trade with action. tell us the key points.

tom: this was the european trade, she was talking about the l,ropean concerns about stee saying it is a subsidized industry that is dumped on european markets. and the other producers in europe. we know the european union are looking at potential terrorists -- tariffs on chinese steel. they say it has effectively stalled until china implements further reforms. she talked to generally about the challenges of european businesses operating here in china. take a listen. >> unfortunately, the reality and china today is not so bright. it is difficult for europeans to make business. there is increasing bureaucracy and lack of transparency, and state-owned policies. it is not a level playing field. we hope to they would pursue the

reforms they had intended. both the europeans and u.s. complain about the number of sectors closed off in china. particularly around the services of health care, finance, logistics, social media, telecoms, all closed off to foreign investment. we heard from wilbur ross, the new commerce secretary under donald trump. he was asked about the potential of a trade war. take a listen. war. are in a trade we have been in a trade war for decades. that is why we have the deficit. the difference is, our troops are now coming to the ramparts. that is the only change. parts of the team in washington drawing up their asia policy. when that finally comes out we will know if the referendum on the campaign trail will be translated into action, these of u.s.-china about

trade. >> first word news with paul allen. >> it has been revealed that president trump did meet with russian ambassador sir take his lack -- sergey kislyak. the president link to the ambassador resurfaced after news that at least five members of his team met him before he took office. trump has dismissed allegations of improper ties with russia as a ruse. the u.s. wants positive action from north korea before any direct talks. them to abandon their nuclear program in return. they announced the north's latest missile tips. jong-un -- >> we are not dealing with a rational person.

we have to see some sort of positive action taken by north korea before we can never take them seriously. they have given us enough reason to believe they are irresponsible. we cannot believe we are dealing with a rational person on this. >> south korea's trial of the century begins today with a preliminary hearing into allegations samsung de facto money to the government for favors. l is the highestee figure indicted in an investigation. samsung concern that early talks are not expanding its manufacturing operations in the u.s. with a new facility for home appliances. the wall street journal says samsung plans to spend $300 million on the project. at the shift may involve moving production from mexico and could generate 500 jobs.

global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am paul allen, this is bloomberg. >> thank you. embarking on the first comprehensive audit of state-owned banks in decades, to protect what is asia's top growing economy. our southeast asia correspondent is at our bloomberg live event in miramar. -- myanmar. are they opening up to foreign investors? they are it is a sign opening up even more. they tried to prepare stay banks for more competition. you may not know this, but there are already a dozen foreign banks in myanmar already since they opened up to the world six years ago. they are competing with 29 local banks. there is increasing competition in the space. myanmar needs to do more to open

up. there are issues to do with policy, regulations, role of law. these are the things that are impacting investor confidence. when you look at the fdi, it rose $9 billion. but last year we saw a slump of 65%. because investment was smooth after the government was elected. there was a lack of policies and where it was headed. investors are taking a backseat. even as economies are opening up, they need to do more to show to the world that it is ready to welcome foreign money into the country. when can foreign investors a jump back in and where are the opportunities right now, is it in the banking sector half? market.is a frontier it is the last frontier market in southeast asia. when you talk about

opportunities it is across all sectors. lots of potential in banking. foreign banks are here. population of 55 million people. less than 10% of them have any access to banks. a lot of opportunities there. opportunities in mining, construction, real estate, infrastructure. lots of opportunities there. we will be speaking throughout the morning to all of the key players across the industry just to give you insights on who would -- who we will be speaking to throughout the day. we will have the managing director of one of myanmar's biggest banks. we have one of the best known and wealthiest businessmen in myanmar. that country's largest retailer.

a busy, busy morning for us here in myanmar. >> we look forward to those interviews. taking aim at south korea's travel sector over deployment of a u.s. missile system. we assessed the damage later in the show. plus, the copper market sends major signals in opposite directions. to explainceo of mmg it. ♪ ♪

>> this is "daybreak: asia," i am betty liu in new york. innne: and i am yvonne man hong kong. they narrowed losses from a $1 billion a year before, over $150 million. record copper production was partially offset by lower prices. this could earnings. newly appointed

ceo. thank you so much for joining us. and ited about copper has been very much a supply story. we talked about it in indonesia. there is been long-term bullishness. but i think there is resistance the $6,000 level. is there a reason to be cautious at this point? confident we are about the copper price. long-term and short-term. we see more and more disruptions. in particular, those disruptions happen to be with the two major, major copper producers. bambas will help mmg get back in the black this year? jerry: they have had successful

commissioning. to 500,000reased tons, which enabled us as the number one copper producer. pounds, las500,000 bambas produced much of it. >> at las bambas there were protests from local groups. is that a concern to you because it risks your shipments and production levels? jerry: it does seem like a real issue. but i have to say, those are a normal thing. recently, and other countries we have similar, not necessarily and othert union political deals. that is the issue faced by minors. -- miners.

a closeto maintain relationship with the government and work with the community. to be responsible to their concerns and work together with the local government and community. do you think those situations will be manageable? jerry: i think so. in theave our people region. they work very closely with the local community. and we have our expertise. they have worked a long time in peru. we have a solid connection with the government. we believe we are confident in that region. want to talk about acquisitions, what you are looking at around the world. innow you are interested buying copper assets, zinc assets, as we discussed. what are you looking for right

now? do you see any targets that are of interest to you? jerry: it is true, we would like to grow and we are looking for different opportunities. we i have to say, whatever do, and wherever we do it, we are trying to make a difference. we make a difference either by leveraging the existing synergy with our operating have in the copperfield in african countries, the andes region in and southeast asia. also, to see if we can make a difference by our own experiences in talents. and weekend improve the operation and make additional value for our shareholders. betty: absolutely, you do want to make that impact. there might not be that many targets out there. have you identified targets?

may be you see something sometime this year? to be veryhave innovative. you are right. there are not too many opportunities out there. open to thee more right partnerships. and also, we are very active with organic growth opportunities in our own organization. yvonne: i want to switch gears and talk about china. we see an emerging slowdown in the properties sector. how big of a concern is this to you when we think about china commodities? there is uncertainty you where demand will go in the property sector. as well as stimulus. jerry: talk about the climate. made ave china has proactive choice, rather than a reactive response. china has not stopped. byna is still growing

developing long-term infrastructure. to partner with other countries so it could see the initiative. china has not design the whole thing, they have encouraged companies to go abroad. establishing an organization to help the financing of that region. yvonne: would you consider building mark copper smelters in china? we aren't -- a mining company that operates overseas. they do have the plan to have a certain good quality copper smelting business in china. yvonne: great to have you here in the studio. let's do a quick check of the latest business headlines. softbank is selling a 25% stake

in arm holdings. they set up with saudi arabia. sources say a billion dollars in shares purchased by vision fund. they wanted included in the $100 billion fund. the deal is separate from the $25 billion softbank plans to contribute. foxconn looking at making a deal on toshiba's memory business. they have approached a company to explore the possibility of working together on a bit. all three companies declined to quote. they have yet to decide whether to launch a joint bid. battle at a chinese gas supplier may be coming to an end. sources say they rejected a proposal to oust two cofounders. a first of two meetings, they

voted to keep the former ceo and coo on the board. the results of the second theing, the sun would sell chairman, is unfounded. betty: it is unanimous, traders sure the fed will hike next week. we will discuss that. ♪ >> this is "daybreak: asia," i'm

yvonne man in hong kong. betty: and i am betty liu in new york. traders are certain the feds will move. b will noture that ec move. we have talked about it so much the past couple weeks.

every day, imf him in an and we are talking about the latest said speaker. we have had so many fed speakers. and the rate hike went from 34%, -- 100%.t is 100% job and employment services company put out their own report two days ahead of the u.s. government. their report showed there were 289,000 private softer -- private sector jobs created. so much so, the bloomberg consensus forecast is now at 200,000. let's jump into the bloomberg and give our viewers a sense of what people take this so seriously. jobsshows us the adp report, the white line. the government jobs report is the blue line. the white line is one month ahead of what we will get friday. backup a month.

adpjanuary jobs report, the came in stronger. jobshe january government report came in stronger than forecasted at 227,000. this is why markets, traders, economists are taking it seriously. to theump over interest-rate projections. you cannot get stronger than 100%. that is where we are for the march quarter. that will bring us to 0.75 to 1%. go down three dates. probabilities, of a hike in june are up to nearly one in two. up two pointear

8%. it is a bear market, that is where we are now. is a different story for the ecb but we see market pricing in and could see a hike mid 2018. his mario draghi going to budge? >> 2018 is as soon as you will see it. but not as soon as he keeps pounding the table about. let's go to the bloomberg now. very powerful lines. blue line, inflation of about 2%, at the ecb's target. 0.29%. energy market at he is telling the germans, cool it. everyone says a little more hawkish. maybe give a forward guided tweak, but no signal. a pretty tame ecb meeting.

unless he sounds hawkish, that could get the markets going. >> thank you. companies saying falling sales. china retaliates from a missile system. ♪ >> a beautiful look at singapore

this morning. sun is out there at the lion city. i am it yvonne man in hong kong. betty: and i am betty liu in new york. you are watching "daybreak: asia ," let's get the first word news with paul allen in sydney. >> the european union says the chinese president must back up his support for free trade and globalization with concrete action. he advanced protectionism, saying it was like locking oneself in a dark room. bloomberg they hope

beijing will adopt a stronger leadership role on such issues. secretary secretary steve mnuchin having a tough time building his team. areces say his choices stalling. questioning are loyalty to the president, whether they are too liberal or two wall street. next week's g-20 meeting. australia's prime minister says political squabbling is threatening the companies -- countries aaa rating. feeding ony are fears for pity point scoring. a hostile senate -- our economicnfront challenges head-on, beginning with a frank and honest discussion. >> australians deserve a mature, constructive device.

without it, we risk putting our rating underedit great pressure. >> the reserve bank of india says it rejects the terms of the settlement handed out. the company's agreed last month to resolve their two-year dispute over the carriers sale of the wireless venture. it with the arbitration for more than $2 million. r.b.i. does not like the deal and will explain why next week. chancellor angela merkel says she only learned about volkswagens emissions cheating through the media. it put reputation at risk. after meeting with lawmakers in berlin, she rejected describing volkswagens actions as a gigantic scandal. she said it was wrong to vilify automakers in general because

they provide so many jobs. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. i am paul allen, this is bloomberg. how the asian markets are shaping up this morning. i am seeing recovery here on wti, but we are still looking mixed in the asia-pacific region. >> oil prices dropped overnight by 5%. that is going to put pressure on what is going on in asia. we have stocks falling across the region. this is oil, holding losses at $50 a barrel. we did have saudi arabia's oil --ister saying inventories u.s. inventories have dropped slower than opec's expectations. while we are seeing the kospi and the nikkei 225 hold their

gains for the day we are seeing a drop in commodities. we have miners in the red. south korea's trial of the century starts today. how are samsung shares holding the middle of all this? >> we are seeing samsung shares -- itg but holding above is the biggest drag on the country today. investors have been relatively sanguine. 41 buys on the stock. shares are snapping as a two-day drop amid reports it has been a products -- it has been approached by foxconn. 37% can set a price tag above the current share price. there is an upside there. >> thank you. u.s. company has been drawn into

china's growing dispute with south korea. beijing ordering a hershey joint venture in shanghai to halt production. moreind chin is here with on this. explain what this is all about, this suspension. >> it is the first time we have seen a u.s. company drawn into the geopolitical tensions, which are slowing around north korea. this is a cause the joint shanghai,factory in and her she has a controlling 50% stake in it. they make chocolate and other confectionery. they are suspended for maintenance activities, in relation to inspections. the chinese authorities ordered production to be stopped for a month due to a legend safety violations. it could cost the joint venture about $3.5 million in lost sales. it will take a punch for that.

but it is really the latest move china has made against companies under the group. they have offered land where they will the ploy the third missile shield system. this is aimed at north korea. north korea has been launching more missiles as of late. china sees it as the threat to itself and its own borders and has mentioned more than once and said in strong terms that it is against it and asked them to stop deployment. south korea has said it is probably going to roll out in april. >> it all comes down to north korea. it seems like it is further complicating china's relationship with the rest of the region. on the political front there is little consensus on how to deal with the north. >> yes, different views on how to deal with it. neither talks nor sanctions seem to be viewed -- working. condemned theil

launches this week. u.s.rench envoy to the said they were looking for stronger, additional sanctions on north korea to go beyond those past by the security council in november. the u.s. ambassador to the u.n., nikki haley, says they must have positive action. the u.s. is reevaluating all options. -- stop trying to antagonizing north korea by conducting military drills in the area and saying they should halt their nuclear proliferation's, their nuclear program. they are saying they really want to talk. >> thank you. back to the business side. analysts think this could have long-lasting effects. things will not be too

bad, at least in the long term. why do you think so? >> if you look at past examples, these are short-lived. look at japan, for instance. there were all these tensions between japan and china in 2012. a lot of automakers had to cut production. there were people burning japanese cars in china. now things are much better, things are back to normal. it took a year, but things worked out in the end. forou say there is more them to worry about than these tensions. for instant some of the rise of the korean won will be a big deal, right? nisha: the bigger deal is for mainland china consumers with over 4%. if you are going shopping and korea, things are more expensive than before. the good value is part of the attraction.

>> is there any reason to think this could spread? small share take a in their revenue. is there reason to think this could be a bigger issue? we have seen some of the shops shut in china -- some of their imports shut down in china, they were told there was bacteria in some of their products. there has been some affect on other companies. the deeper issue is, we have a lot of supply-side components they do not want to be cut off. that is why i feel it will be short-lived. >> as you mentioned, other companies have protested this before. in kind of impact, it particular, the japanese automakers. there a long-standing

result of these protests or is it forgotten and no impact here? nisha: if you look at japanese cars in china, they cannot match how volkswagen sells, for instance. but a lot of them have rebounded already. stillk the tensions are there, political tensions remain. when it comes to the consumer, these things are forgotten easily. mentioned the nationalistic cited these disputes. the you cannot change the fans. k-ha: that is the beauty of pop. people have a lot of love for it, in this region of asia. they will find ways to watch this stuff they like. the shows are not streamed as much anymore. yvonne: they will find a way. great to have you. you can turn to your bloomberg from our on this. you can get commentary and analysis from bloomberg's expert

editors. betty: and we will be live to hear from a business leader, managing partner of delta capital. ♪ >> and this is "daybreak: asia,"

i am betty liu in new york. yvonne: and i am yvonne man in hong kong. coca-cola --d plans to boycott beverages made by the companies. complaints about groundwater. it will be announced next week. the call comes a week after neighbors stopped selling sodas made by coca-cola and pepsi. planning airways carrier to india, aiming for a bigger slice of the market. a 100o wants to launch

strong fleet of airplanes. they tried to boost their presence by purchasing a stake. the latest attempts will not involve joint venture. >> bloomberg sources say that e.u. commissioner is seeking to reimpose fines of $850 million over an alleged airline cargo sale. therefrance and others a actionated -- earlier with other airlines was thrown out. opens its economy come up private equity firms are making it back. challengers remain, even those daring risk -- even for those daring risk takers. we will take you to myanmar where our chief correspondent in

southeast asia is standing by with a leading private equity investor. take it away. early movers here in myanmar, and you can see why. a population of 55 million people. 60% are between 16 and 65. the economy, poised to double by 2030.ars, quadruple we are talking $200 billion. nick powell is here with me. myanmar is for the brave, isn't that true? think that is true. it is definitely early. but there is an advantage to being a first mover in this market. how have you benefited? and where are you invested? >> it is early to talk about returns. we have been investing since 2013. the investment spaces are quite

simple. we believe political change is real and that is going to unleash decade-long growth. environment, which is difficult, will improve. that is what will generate your return. >> what are you optimistic about? we are talking about $9 billion in the year to march. it dropped 65% last year because investors were confirmed -- concerned of a lack of clarity and policy. why do you think it will be better and smoother from now on? >> a couple things. that was a blip. compared toat fdi three years ago, it is better. number two, oil and gas is in outside part of that. there was a big decline in oil and gas. thirdly, the new administration has only been in for 11 months. people are waiting to make final investment decisions so they can

see exactly what the playing field is. >> what are you looking for from the new government? it has been pretty quiet. >> it has been quiet but you have to give them time. they have strong mandates and the late at what their priorities are. the peace is top of their agenda. but the economy is key, trading is key. fdi is important for that. important piece of legislation we are all waiting for as investors, which is in parliament. it is investment law, the companies act. it will dictate how foreign investors can invest, and which sectors they can buy. that will be clarified in the new investment law. >> are you in telecom? what is exciting right now? was not on our investment target three years ago.

growing thea sector fastest. you have full national coverage now, better infrastructure. you have gone from 3% penetration to 80%. 80% of the population on a mobile telephone today. anything you can deliver digitally, music, books, television services. the adoption rates are incredible. when china started consuming, the private sector took hold back in the early 2000's. >> what are you talking about digital banking? we talk about the average income $1000 myanmar person is u.s. million early, but 55 people, -- we're seeing that grow very quickly.

the moment financial services kicks in on that basic level, there is a portion of the population which needs further banking than that. your traditional rollback of opening a bank, getting customers, will be superseded by online ranking and digital banking. >> you are pretty upbeat. are there any risks out there? what do you deem as the biggest risk for investors in myanmar? >> the political process has happened, we have a new administration with the strong mandate. today is the legal environment you are investing in, that is improving. just late in there. and challenges are, everything from human capital, you have had decade-long sanctions. a lack of investment in education. you do not have a pool of talent or experience there. we have to bring in and bring

back burmese who have gone overseas for education and experience, to invest in training. that is a challenge. and basic infrastructure, roads, rails, electricity. >> and issues to do with rohing and the borders it shares with china. they say they are reluctant to put money into the country because they can be seen as condoning what is happening. what is your take on that? >> that is true. but they are all a decades long problems, not problems that happened recently or are attached to the new administration. actions are being taken to deal with them. willeing realistic, those still be issues in the for seeable future. doing it properly and responsibly, that is the way to deal with it. through a in myanmar joint venture, is that the best

way to go? need a local partner. you cannot come here and expect to execute without a strong local partner. operate and do investments, you need that. >> we are live from the bloomberg in the myanmar summit happening throughout the day. betty: thank you so much. speaking to help the capital myanmar managing partner nick powell. donald trump facing challenges to his revamped travel ban. ♪ >> this is "daybreak: asia," i

am betty liu in new york. yvonne: and i am yvonne man in hong kong. you are watching china inflation? >> absolutely. we have been looking closely at the factory gate number that produced price index. it has shot up into the positive rates. we are looking at 7.7%. a few months ago that turned positive after 53 months of deflation. reaction inhave about 35 minutes from now. north korea in the mix when it comes to geopolitics right now. we have the foreign minister of

china talking about pyeongchang and washington being on a collision course, putting a red light on both of their actions as well. jointor the u.s. to stop exercises with the north korean military. in the north, to halt its nuclear program. myanmar continues. and our correspondent will be back in 20 minutes to talk to the oil executive. interest,out their and tell viewers why people should be casting and -- an eye on this frontier market. betty: thank you so much. at the white house facing a fresh round of lawsuits following president trump's revised travel ban and other immigration policies. on this.encio has more let's take a step back. who is the plaintiff in this lawsuit? unnamed, a u.s.

citizen, a male of egyptian dissent. he is alleging he is facing religious and racial discrimination because he is a muslim and is working at a mosque in hawaii. that is fairly rare. i lived in hawaii for a year and did not see that. a very diverse state. it stands to reason it would be a good place to be. his mother-in-law cannot get a visa he says if this travel ban was enacted, according to the executive order. it is happening in hawaii, the first date to challenge mr. trump's executive order. request, thege state's attorney general saying -- arguing its unconstitutionality. willg the executive order result in the establishment of religion in the state of hawaii and hurt hawaii's economy, education system, and tourism industry. looking ahead, we will not have too long to wait to see what is

happening on march 13, next monday. the doj can have -- can challenge what is happening in the court. the judge will hear it on march 15. if you rules in favor of hawaii and it does not go into effect marches 16, we have this to ponder over. trump's new travel ban has a set of legal challenges. but his policies on sanctuary cities is another big one. a this has been with us since january 25 when donald trump laid out his edicts about sanctuary cities. saying he would withhold funding from any city that would not comply with enforcing the deportation of these undocumented immigrants. taking a step back, sanctuary cities have said they will protect these undocumented immigrants. especially if they do not have criminal records against deportation. there are 300 of them in terms of jurisdictions across the country.

the biggest, san francisco, new york, washington. the san francisco attorney general said to a federal judge that they need to block this case, this order, to cut federal funds. mr. trump has said he wants to with hold up to $2 billion in funding. to put that in perspective, that san francisco's total budget for 2016. that they say they are not budging, we will see you in court. >> thank you, that is it for us. 20 to come. coming down to several more markets opening in asia. >> and we have china inflation numbers. ♪

rishaad: it is night a.m. here in hong kong -- 9:00 a.m. here in hong kong. i am haidi lun in sydney. we are looking ahead to the latest check when it comes to the chinese economy. but let's get you up-to-date with the headlines. ♪ rishaad: china inflation