>>this week on world business a look back at some of the best stories of the last year including. >>growing old before it grows rich; china will soon have to face the problems of a massive aging population with no social safety net. >>we're going to see a country whose working population was among the most rapidly growing in the world for the last 30 years convert itself into a country whose working population will be among the most rapidly contracting in the world . >>how mountaintop coal mining is literally changing the landscape in west virginia. >>as far as i know there's no way you can blow up a mountain and put it back. there's no way they'll actually ever gonna get this back to its original contour. it's impossible. >>and ever felt you are being watched? the number of cctv cameras in the uk is hitting

staggering numbers, but is it really money well spent? >>if you've got a camera showing a crime being committed, i would say that shows cctv doesn't work! but somehow the public believe it shows it does. >> abirached: hello and welcome. i'm raya abirached and this is world business, your weekly insightinto the global business trends shaping our lives. this week we are looking back at some of the best stories of the past year. china may be the economic powerhouse of asia, but it is also aging. and as the country grows old it could hamper growth. >>reporter: when these ladies were in their 20's, reaching

60 was considered quite an accomplishment. >>now life expectancy in china is 73. and in terms of cash, they're also fortunate. because as former urban state workers, they're among a privileged minority of chinese that receive apublic pension and insurance cover. >>luming: i am diabetic. because i have the national medical insurance which covers 14 big diseases, i don't have any pressure. it covers my whole year's treatment. >>reporter: but seven in every 10 mainland chinese - mainly in the vast countryside - have no safety net - only savings or family support to fall-back on when they're old or sick. and the government's task to try and redress this imbalance, which ferments social instability, is getting harder by the day. >>reporter: china is getting older rapidly because living standards have greatly improved since the1970's. by 2050, there'll be more

elderly chinese than today's entire us population with over 100 million aged 80 or over. and just look at the youth numbers. for the economy, this means fewer workers down the line. >>reporter: come 2015, the workforce will start shrinking. and this is a direct consequence of the one child policy, introduced in 1978. >>pettis: we're going to see a country whose working population was among the most rapidly growing in the world for the last 30 years convert itself into a country whose working population will be among the most rapidly contracting in the world . >>reporter: and this has huge implications for china's competitiveness not to mention its ability to finance credible welfare provisions. although china is now the world's third largest economy with per capita income that has risen more than 10 fold since the 1970's, it's still very much a developing country. >>reporter: unlike the income levels of other ageing

countries, it's all happening to a chinese population that's still poor over a 100 million people here live on less than a dollar a day. >>reporter: how the government navigates this demographic transformation will influence the country's future prosperity and stability. >>reporter: so what are the options? >>reporter: there are growing calls to scrap china's controversial family planning rules and so expand the next generation of taxpayers that the economy will depend on. but in the near term this isalso problematic. >>pettis: the problem is of course that babies don't become workers for 20 years. and so we end up with a much worse dependency problem and much heavier expenditure. >>most urban employees in their 40's and above expect the status quo to continue or at least improve. which means, leaving the workplace before 60 on modest but adequate benefits then dote on their only grandchild.

>>huibi (in chinese): in the past, because there were no birth control policies, there were too manychildren. life was too difficult. now, there are less of us in the family, our living standard is better. >>reporter: her son knows little about the pension time bomb, but like many young parents, he won'ttrust in the state to provide for his retirement. he's one in a new, growing breed of chinese consumers that buys private insurance. >>yunfei (in chinese): our generation thinks about how to work to pay for pensions and insurance so that when we retire, we can have a good life. >>reporter: private insurance annual premiums now top 55 billion us dollars with the industry growing by over 20 percent annually. foreign companies are established in the country's mature metropolises like beijing and shanghai. >>mackie: a rapid development of the private sector, including capital markets reform, would help support the future needs of those with disposable income. but a strong state retirement scheme is still a must. the trouble today, however, is

that china's basic urban pension scheme also covers the underfunded obligations of shuttered state run factories. according to a world bank report, these payments swallow-up almost half of today's contributions. as china ages, the country's pay-as-you-go pension system in its present form is in danger of collapse. >>reporter: as policymakers consider changes, including a fully funded urban scheme linked to individuals' contributions, they're also evaluating new policies for the countryside. over 90 percent of the rural elderly have no pension. they rely on their children for support, many of whom work away as migrants. >>xiongqi (in chinese): the urban areas have the state retirement insurance but the rural communities don't. the government's new rural retirement policy treats both urban and rural as equal. >>reporter: in trials across the country, officials are encouraging locals to start

contributing toa state retirement plan. and for the elderly, the government is rolling out a non contributory pension with a payment of between 8 and 12 dollars per month. the thinking is, if this pension handoutis spent, not hoarded, it'll help boost the local economy. >>kaidi (in chinese): the increase in the number of elderly creates a new consumer group and helps develop a new service industry that focuses on the needs of the elderly. >>reporter: so ageing may present some industries with clear growth opportunities but of course, only if there is someone to pay for it. but for the country at large, the political and macroeconomic challenges are huge - so much so, that china could be on the brink of an era of slower growth and mounting social stress. >> abirached: half of the electricity in the us is powered by coal and west virginia produces 160 million tonnes every year. roughly a third of that is obtained

by mountaintop mining, a technique that is becoming increasingly controversial. >>reporter: it isn't easy to get to a mountaintop mining site in west virginia...in our case, it requires the help of a four wheel drive and a keen conservationist. >>webb: lets get out and venture off. what we're going to do, we're going to walk down this road and go round the corner here and you're going to be blown away. really. yes. >>reporter: ben webb is right...it is an awesome sight....and not one he likes. >>webb: how do you feel when you see something like this? i feel horrible. it's horrible what they're doing here. i think this sites roughly 21 miles. it's pretty bad. >>reporter: mountaintop mining accounts for about 40% of all the coal mining in west virginia. it'sa form of surface mining that accesses shallow coal seams. one the coal industry sees as essential...

>>raney: we're able to recover the full coal seams in the top of the hills because you can't underground mine them. they're too thin. you can't hold a top, you can't have a bottom. you can't have a safe environment for an underground mine in these upper coal seams. >>reporter: but activists say mountaintop mining is creating anything but a safe environment. i meet bo webb beside an elementary school that lies directly beneath an active surface mine...one he's convinced is poisoning the area with dangerous coal dust and chemicals. >>webb: the american school board journal came in here and did a story and their investigation showed that 10 people, students, staff teachers had died of cancer that attended this school in the previous 6 years of their report. >>reporter: however coal industry supporters say surface mines are both legal and safe. and while they admit active sites aren't pretty, they point out that companies are required by law to eventually restore mountains to either their approximate original

contour, or, in a state where naturally flat land is rare...levelled off to encourage development, like at this former site. >>horton: so any kind of flat area that you can create in your opinion is valuable obviously economically. absolutely it is. it allows us to keep our children at home and employ them here and they don't have to leave home. >>webb: of all the land that's been flattened in west virginia, only about 3% has had any reclamation. it's not being used for anything. they're not improving it in any way. >>reporter: in fact, environmentalists say mountaintop mining is nothing more than a cheap way to access coal...by blowing the tops off mountains, and filling in adjoining valleys with leftover wastethat chokes off streams, pollutes rivers and tarnishes water supplies. >>raney: first of all it's not waste. it's the natural rock and dirt that is out in the ground above the coal. it's not waste at all and you know i take offence to people using that term because it'scompletely inaccurate.

>>sebok: it turns everything orange, like rust. the only thing i could clean it off my bathtub and commodes and things was an acid cleaner, an acid based cleaner. >>raney: every drop of water that leaves the site has to be treated in a system of some sort to be sure that we meet water quality standards. >>webb: for them to say they're putting out clean water is just a ridiculous statement. >>reporter: whatever effect it's having on the environment, signs of support for a coal industry that still accounts for around 15% of west virginia's $46.3b gdp aren't hard to find. largely because in what is america's second poorest state, for generations it's provided jobs for the locals. >>cline: i've worked in the mines 27 years. my grandfather worked in the mines. and my dad worked in the mines. and all my uncles worked in the mines. >>reporter: in nearby logan county, some see those coal jobs as crucial to the local economy. >>kirkendoll: it probably

touches directly 80% of the people in some fashion to a spinoff job or whatever, so it's critical to us. >>reporter: most coal miners earn over $60000 dollars a year, more than double the state's average salary. >>webb: these guys in order to make 60000 dollar a year, they're working an awful lot of overtime. >>reporter: surface mining in west virginia directly provides around 6000 jobs. it only accounts for about 6% of the 1.2b tonnes of coal mined in the usa each year, so environmentalists say it's not essential...more importantly, they believe it simply can't be done in a way that isn't hugely harmful to the environment. >>webb: as far as i know there's no way you can blow up a mountain and put it back. there's no waythey'll ever gonna get this back to its original contour. it's impossible. >>reporter: others, however, believe the restored sites are just as good as the real thing. >>horton: lot of times i'll just drive up here by myself or with a couple of my buddies or maybe mywife and we'll just sit around and enjoy the quiet and peaceful afternoon. couple of beers? yeah we'll have

a couple of beers. yeah. that's a fact. maybe grill. sometimes we pitch a little shoes. have a good time. >>reporter: those opposed to mountaintop mining claim it's already ruined over 500 mountains covering 1.5m acres, and is slowly but surely destroying the appalachians. >>webb: looks like afghanistan. you know, it's supposed to look like rich thick forest. >>cline: if they do away with mining and coal. west virginia is going down. it can't survive. >>raney: they don't offer any alternative to it. they say do it underground. you can't mine that coal underground. so they give you easy answers and they walk away. >>still to come on world business >>stunning scenery and sailing in the banda sea in indonesia. >>and big brother is watching the streets, but is cctv really an effective deterrent

>>crime time television... and the rest in just a moment on world business... >>the uk relies more on cctv cameras to prevent and detect crime than any other country in the world. so why britain is such a fan of monitoring its citizens, how much does it cost and above all, is it working? >>reporter: ever felt like you're being watched? with only 1% of the world's population britain is home to an astounding 20% of the world's cctv cameras exactly how many watch uk streets is hard to say but reports suggest that it could be as many as one for every 14 people. >>ingledew: i think that cameras grew very quickly in london, and indeed

in the country as a whole over a short period of time. we've actually put a stop to that now >>russell: when george orwell penned his famous novel, 1984, even he couldn't have predicted the extent to which his words would ring true in the 21st century. and yet here in the heart of london, where the author once lived, there are more than ten and a half thousand digital eyes spying on its citizens and that's just the ones funded by the home office. in reality there are probably more than amillion cameras watching these streets. >>reporter: some $300million of public funds has been spent on cctv in london over the last decade that figure rising to nearly $800million across the uk.... but according to an internal police report released last year the technology is failing to have a significant impact, with only one crime detected each year per 1000 cameras amounting to what some say is an almost criminal waste of public money. >>farrier: of course a massive amount of money has been

wasted on cctv, at least ú500million of public money. now what would have happened if you'd used that ú500million to do something that actuallydoes works? for instance street lighting costs a fraction of the cost, we know it has much better results. >>davis: the home office has actually carried out studies of its own which show that after the first few months cctv ceases to have any effect at all. it doesn't deter crime at all and for a very good reason the criminals know nobody ever looks at it. >>reporter: in fact even scotland yard officials are prepared to admit this they just don't have the manpower to sift through all the footage and even when they do it is often not of a high enough quality to assist in a conviction. >>davis: i don't mind footage being simply recorded if it's used when it does catch a crime, and that can happen too. the trouble is what you tend to find is that it's either broken down, or the footage is not there...i mean the most outrageous case of this was the very, very famous shooting of jean charles de menezes

in the stockwell tube shooting, and none of the footage on the train, on the platform or on the bus was actually available. you've got to make sure that if you're going to have these things, they are available; can be used, so that when you do have a crime you can catch somebodyfor it. >>reporter: uk web start up, internet eyes is trying to rectify this problem by setting up a systemwhereby members of the public can log in to random camera feeds from the comfort of their own homes, gaining a cash reward if they alert the camera's owner to a crime in progress. while a good idea in theory the business model has to be very carefully constructed to overcome the objections being put forward by the ico, and at this time they are unable to comment about the status of the project. >>reporter: the debate blew up again this year when it was revealed that councils are using number plate recognition to issue so called ghost parking tickets, without the need for parking wardens to be out on the streets.

>>davis: what you tend to find, and we've actually found it with individual authorities, they hire a firm to run the thing and very quickly instead of pointing it at the cash machine to reduce crime,they point it at the parking areas to increase revenues. >>reporter: aside from financial issues and incentives human rights campaigners say the cameras aresimply an invasion of londoner's privacy and there are big questions around their regulation. >>coles: that's one of our major concerns with cctv is that it's not properly regulated. we've got some limited legislation that governs how some of the images are to be stored but there's not reallyany legislation governing where cctv is to be placed, who's to operate it there's only voluntary codes of conduct. >>reporter: but the weight of public opinion is behind surveillance. while the home office weren't available to be interviewed on camera somewhat ironic given the number of cameras they point at us they issued a statement which said 80% of people support the use of cctv and that they believe it is a crucial crime fighting tool. >>burton: i think that

generally, organizations like ourselves at tfl use it very effectively and we publicize very well how we use it. we're very conscious of data protection, we're very conscious of civil liberties, but we ensure we use them in the right way for the right reasons. the other thingis that you'll find that cctv footage is very effective for both detecting and convicting people ofcrime. >> reporter: although according to some, quite clearly not a deterrent. >>farrier: of course the stupidness of that is that if you've got a camera showing a crime being committed, i would say that shows cctv doesn't work! but somehow the public believe it shows it does. >> abirached: the islands of indonesia have plenty of beautiful spots for tourists to take to the water, either sailing above the waves or diving beneath them. the banda islands are particularly spectacular and this year paid host to some pretty spectacular racing as well.

>>reporter: a warm welcome for international yachts arriving in ambon with indonesia's political and business elite all out in force to greet them. >> yudhoyono: we are holding sail banda to showcase our grand maritime heritage that has international standards. this is our momentum to promote our diverse marine archipelago to the international community. >>reporter: 106 yachts were taking part in sail banda, part of sail indonesia, one of the largest maritime events in the country. the first leg kicking off in the far-east. >>boats representing 18 countries set sail from darwin, australia through the choppy banda sea to the capital of the moluccas. the three-month long race charts a course

over 5,000 kilometres the entire length of the country. >>kazon: we have received a wonderful welcome. we have been treated like royalty. everybody was so friendly and helpful, absolutely unbelievable. >>whitby: it has been really great, there was good entertainment in darwin before we left. banda was absolutely superb; everybody had risen to the equation. all the locals were full of enthusiasm. >>reporter: in ambon organisers pulled out all the stops not just supporting yachts from america to france, but also local people with floating hospital ships in harbour providing free medical care. >>laksono: we treated more than 37,000 patients on the indonesian and us navy hospital boats. doctors from singapore and australia were all helpful it's team work. >>muhammad: it is the biggest

ever done since the republic has been established... all of these places come along to support our healthcare people here. >>reporter: offshore activities were also matched onshore, with conferences and workshops the mainaim: to boost the welfare of the moluccans. >>mcelroy: the origins are around sailing between australia and indonesia and yet what we are seeing over this month long celebration, is all these industries, the industrial parts, the export parts,the island communities story all getting a voice in international forum. >>hayward: many components to this event in its relation to the sailing in the region. one of course in kind of slang terms is a reboot of the ambon image and the ambon community after the troubles of a decade ago because you will only encourage tourism here by actually having tourists come here onsite >>reporter: hungry for primary resources the chinese were

also looking to develop business interests in the province during the sail banda event. >>jun-feng: i think there is a lot of potential of cooperation between the two sides, especially inthe tourism industry...we want to have more of this investment in to this maluku >>easen: sail banda is more than just a yacht race. it's a rallying call for this province to be more active in promoting its vast natural resources. fisheries and tourism dominate here. but developing these industries across hundreds of islands that cover an area the size of turkey is a challenge. >>reporter: to-date government and businesses are seeing growth from a low base. the province only receives five percent of indonesia's seven million visitors each year. yet the banda islands are world-famous for the spice trade, especially nutmeg once worth its weight in gold. >>reporter: the moluccas have also been named indonesia's

centre for fisheries encompassing 600 thousand square kilometres of sea. both under-utilised sectors are now being fast-tracked for development. >>hayward: eastern indonesia has vulnerabilities; has vulnerabilities which are both environmental,political, social, economic. it also has great resiliences. because this area has an amazing history of trade with other regions and with maintaining its own environments so it is a question of balancing those two areas. >>soesilo: we are moving forward to make ambon and maluku the gate of east indonesia, ready to invite investment for the coming years, mostly on marine and fisheries sector...the potential of captivefisheries in this area is more than one million tonnes per year. >>reporter: robert tjoanda runs one of the largest tuna processing companies in the moluccas. and business is booming. each year his company sells over one thousand tonnes of fish for sushi mainly tothe us hit by a slump in the u-s dollar, the challenge is now accessing

new markets such as europe. >>tjoanda: from ambon we have to send to surabaya first then from surabaya to taiwan. a lot of transit points, that make a lot of costs and that makes us more hard to compete. >>mcelroy: the problem with small islands is that you don't have a mass of local markets. you are dependent upon the outside, you don't control anything, you are a price taker, you have no control onwhat is happening you just responding to what is happening. >>reporter: that's why tjoanda and others hope sail banda will bring fresh investment in transportation, infrastructure and communication allowing businesses to be more connected to global trade a sentiment shared by the government. >>ralahalu: one of the biggest challenges here is the investor. we hope there will be potential investors who are interested in our huge fish resource... ...it is very important to manage this properly so that we can increase the moluccas economic growth.

>>reporter: while the yachts sail off towards sulawesi and beyond, moluccans hope that sail banda has not just rebooted the province's peaceful image, ten years after ethnic conflict, but also steered them on a course to greater prosperity. >> abirached: that's it for this week's world business. thanks for watching. we'll see you again at the same time next week.

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