>>this week on world business a look back at some of the best stories of the last year including. >>it may be landlocked poor and small, but laos is determined to succeed. >>i'm very confident laos can achieve much better economic development and poverty reduction process. >>with the pound in the doldrums and the uk economy in tatters, buildings in london are proving a bargain for rich buyers from the gulf. >>today 85% of the investment going on in london is driven by the overseas market. >>and demand for ser yachts has reached such levels that the real battle is now to find a berth. >>the waiting lists are huge. you could wait for a decade to get a berth annually and you're not sure to get one.

>>abirached: hello and welcome. i'm raya abirached and this is world business, your weekly insight into the global business trends shaping our lives. this week we are looking back at some of the beststories of the past year. while its neighbours have boomed, small and landlocked laos has struggledto progress and many of the population are still desperately poor. but by concentrating on its strengths, the country has taken great strides forward >>reporter: the numbers tell a story of rapid change. >>since the mid-1990s, the number of laotians living in poverty has halved, while per capita income,though still

only around 800 dollars a year, has more than tripled. >>reporter: over the past five years, foreign direct investment has surged from only around half a billion dollars a year to more than four billion dollars in 2009, helping the country to average more than seven per cent annual growth. >>illangovan: the government itself embraced the market mechanism which created opportunities for people to find employment; therefore wage earning potential was there. the second is the economy modernized so they had more value added opportunities whether it is in agriculture, tourism. third is natural resource sectors opened up especially on hydro and mining. >>reporter: hydro power and mining have been the big draws for foreign investment. >>the theun hinboun hydroelectric project was largely funded by the asian development bank, and is now owned by a consortium of lao, norwegian and thai interests.

>>reporter: it has been one of the country's biggest foreign currency earners, and has brought sometangible benefits to those living nearby, not least of them electrification. >>maelzer: work has begun on an expansion of this project, which will double its power capacity. and some 100 kilometers upstream from here, by far laos' biggest power project, the nt2 dam is getting set to go on stream. as with this dam, some 95 per cent of its power will be exported to thailand. >>reporter: funded by the private sector and donor agencies, that hydro project will earn the country around 2 billion dollars...money that the lao government is required to spend on protecting the environment and reducing poverty. >>the nascent garment making industry has also been attracting foreign investment, particularly fromneighboring countries. >>reporter: the industry accounts for about a fifth of the country's export

earnings and plays an important role in reducing poverty. >>one-sy: we employ around 28-thousand young workers, mainly 86 per cent are female workers. that is a big contribution because these people came from the rural areas especially from the northern part. >>reporter: despite the recent surge in fdi, laos remains heavily dependent on foreign aid, which makes up close to 80 per cent of the government's capital expenditure. >>aside from helping improve infrastructure, health and education, aid donors are doing what they call capacity building, working to improve the country's ability to govern itself well, and properly manage its revenues. >>kim: that becomes critical because now more foreign direct investment and economic development pressure on natural resources. second

rapid modernization in economic structure needs skilled labour so laos needs to improve their human resources. third, the challenge is how to diversify their economic structure. >>reporter: the government has steadily been opening up the lao economy. >>xaybandith: the government has made a lot of improvement especially in regulation, business administration, process which is shorter than before, easier than before. nevertheless there are still some complexities in that one, especially for foreigners, normally they are looking for studies, statistics, data and so on, which is very hard to get, especially official data. >>reporter: for input and ideas, the government has been looking to the private sector as well as to the development agencies. >>kim: laos has a good

momentum to maintain this good development and with the strong commitment from the leadership and guidance and also full support from development partner agencies, i'm very confident laos can achieve much better economic development and poverty reduction process. >>illangovan: what they want to do is look at what lessons are out there in the international development market place that they can embrace and how they could use these lessons, adapt them to the local situation and benefit from it. >>reporter: that situation includes being landlocked, but with booming economies like vietnam and china next door. >>reporter: already laos attracts significant investment and does most of its trade with its neighbours. but laos needs to greatly improve infrastructure, raise the quality of its work force, reduce corruption and continue to make itself more attractive to foreign investors aid if, as the development agencies

put it, it's to go from being landlocked to land linked. >> abirached: when recession struck, the uk's famously buoyant property market took a rapid dive and as the downturn continued, the pound weakened. as a result wealthy investors from the middle eastand asia took the opportunity to snap up trophy buildings in london at rock bottom prices. >>reporter: morning in london's elegant st james's district, it may not be obvious on these exclusive streets but with the pound still weak, tourists with more cash in their pockets are back looking for bargains. >>and it's not just in the shops that overseas visitors have been hunting out the good deals. >>reporter: here, in the heart of the capital, the 105 room stafford hotel recently changed hands for $128million.

>>the buyer was egyptian family business the ramw group, and its ceo ahmed el sharkawy believes it has the mix of quality and tradition he has been seeking for six years: >>el sharkawy: you couldn't have picked a hotel that would depict the english tradition more so than the stafford, its location, its heritage, its history. >>reporter: it used to have a tunnel that linked it to st james's palace, and still boasts a wine cellar dating back 360 years. and the new owners, who have interests in construction and hospitality in egypt, are determined to lose none of the traditional feel during their planned refurbishment. >>el sharkawy: we have to maintain a balance between british tradition and heritage on one hand andbringing the service, upgrading it to the international standards as far as the service, exposure and other issues relating to the hotel in general.

>>baldwin: this cobbled mews is a reminder of days gone by, guests live in luxury where the horses once were stabled. but it's not just old world charm attracting buyers back to london. >>el-sharkawy: the moment you start thinking with your heart, that's when problems start, you have to look at dollars and cents. >>reporter: indeed dollars and cents are at the heart of this, or rather the weakness of pounds andpence which is causing foreign buyers to flock to agents in central london and pick up half-price bargains. >>brett: with the change in exchange rates, the property fall in london has been circa forty, fortyfive percent and with the appreciation of the dollar against sterling, of about 25 per cent, the change in value is between fifty and sixty per cent overall. >>reporter: and that means plenty of interest. knight frank recently published

a survey showing that demand for all property in the capital has risen by 35 per cent in a year. but the frenzy is especially affecting the city of london. >>clifton: the market is booming, it's an extraordinary time, the city market is such a volatile market that getting in or getting out at the right time is everything. we've seen a whole series of events occurring at the same time, we're almost heading for a perfect storm where interest rates, currency, the clarity that is the uk market is attracting truly worldwide interest. >>reporter: buyers are bringing old oil money, and new asian wealth to the city. >>clifton: we are seeing a huge sea change, two years ago fifty per cent of investment in the city of london or central london as a whole was uk and fifty per cent was overseas broadly, today 85 per cent of the investment going on in london is driven by the overseas market and of that 85 per cent probably half is coming from the middle and the far east.

>>reporter: this prime piece of real estate, next to the bank of england has just sold for 40 million pounds or seventy million dollars today. the old headquarters of the midland bank is a listed building by famous english architect sir edwin lutyens. its former russian owner has gone bust aftepaying the equivalent of more than a hundred and fifty million dollars two and a half years ago. >>reporter: with permission for conversion to a hotel, and a strong room which doubled as fort knoxin a james bond film the new foreign buyers think they've found a safe place for their funds at a bargain. but behind the drive is not just discounted prices, it's also the long term value, and guaranteed income offered by the prestigious tenants of london's trophy office blocks. >>brett: there is a long term nature to the income, and as the properties remain above long term yield averages, they still look relative value compared to other cities around the world. >>reporter: annual yields

of six per cent or higher are a lot better than the half per cent offeredby the banks. that's what new player the libyan investment authority achieved when they recently bought 14 cornhill, the old lloyds bank, right opposite the bank of england, for around 200 million dollars. >>reporter: even beleaguered canary wharf has been given a boost, with current investor qatar upping its stake, and a new fund from china chipping in smartly to help. >>bill: the chinese sovereign wealth fund, which is the biggest in the world, with i do not know how many trillions of dollars it has got in it, bought into canary wharf, now i heard this morning that they took three days to make that decision, they spent 350 million pounds, they were straight in there, and the reason quoted is they believe london to be one of the three financial capitals of the world, and where better place to put your money. >>reporter: and still at canary wharf, the hsbc tower has just been sold to the national pension service of korea for $1.29 billion. one drawback to all

this activity is that demand is now far outstripping supply, but for the agents and for buyers like ahmed el sharkawy, it's the stability of london which will keep the money rolling in. /e >>el sharkawy: people come and drop 700 billion dollars here, or pounds, or yen whatever the currency is, not for the looks of the people here, but it's because of the political stability, the rule of law, the fact that there are safety nets here. >>reporter: and that's a welcome vote of confidence, in these troubled economic times, for a city determined to hold on to its position as a global financial centre, in a country still in the world'stop five recipients of fdi. >>still to come on world business... >>how nascar is fighting to keep the power on despite the recession >>and superyachts are still selling by the boatload but finding a mooring is more

of a challenge. >>a quay is the key ... and the rest in just a moment on world business... >> abirached: despite the global recession demand for superyachts has pushed production to such levels that there is now literally no room to accommodate them. what matters now is not whether you canafford the boat, but whether you can buy a berth. >>reporter: the maltese falcon, a state-of-the-art super yacht and one of the ultimate status symbols. the cote d'azur is the destination of choice for these marine behemoths and as yachts get bigger, and fatter, the marinas are stretched to breaking point.

>>steve: the average is around 70 demands by day, per day and we increase this level during the summer. ... it's a real challenge each day to manage these berths. >>milns: antibes marina is one of the biggest and most popular and whilst it is possible, just about, to rent a berth space on a short-term basis, if you are looking for a long-term solution, the preferred option, albeit an extremely expensive one, is to buy a lease. >>murray kerr: all the phone calls i get are for the south of france, they simply are not enough berths. everybody wants to be here, permanently preferably, but the waiting lists are huge. you could wait for a decade to get a berth annually and you're not sure to get one. the best way to short-circuit the waiting list is to buy a berth. you buy a berth then you can

expel the tenant and you can use the berth yourself... >>reporter: however, most of the leases are due to run out in 10-15 years when the marinas return to state ownership. the plan is that current owners will get priority to rent their old berth, for a similar rate to their current service charge but there's no guarantee that this will be the case. >>murray kerr: you never know who's going to be in power in the next decade so it is a bit of a question mark here. >>reporter: despite this uncertainty, the prices are as extravagant as the yachts themselves. here a short term lease starts at $750,000 for an 80 foot yacht berth but can get much, much higher. >>milns: it may only be a difference of 100 m but while it's free to drop

your anchor over here, over here on the quai de milliardaires, or billionaires quay, are some of the most expensive and sought-after berths on the entire cote d'azur. the last one sold back in 2008 for a staggering $21 million. >>reporter: the cote d'azur commands such high prices because, despite the lack of space, the southof france has the necessary supporting infrastructure. >>gartner: there is a lot of people around here who know how to work on these boats, supply the services. it's really important just to have some place to go and it's getting harder and harder to find these places as boats are getting bigger and bigger. >>reporter: and it's not just about the length, width is equally important. >>certaldi: one major point is the beam of the boat. we had 10 years ago boat of 40 m with 8 m beamfor example now we can have a boat on the same berth of 12-14m beam so obviously one boat is taking2 berths. >>reporter: it is a factor

that is increasingly affecting sales of the yachts themselves. >>seal: on occasion we've had people who won't commit to buying the yacht until we found that the berth for the yacht, so that can slow things down even stop the sale from happening. >>reporter: even so, even if worldwide yacht orders stopped today, the backlog is such that there would still be four yachts over 80 feet being delivered every week for the next four years. when the demand so clearly outstrips supply, the solution would appear to be obvious, increase the supply. however, the french government will not allow any more development. italy and spain however are both building new marinas, and puerto montenegro is an ambitious new project on the adriatic coast. it hasthe potential capacity for 650 berths, including 150 super yachts.

>>corlette: prior to our taking over is that it was set up for naval frigates and so the infrastructure that's in place - the docks themselves are between 15 and twenty metres wide. and for these large yachts, the super-yachts from 100 metres up to 130 metres. they need this kind of heavy duty infrastructure for the provisioning, the fuel trucks and for the yachts themselves to tie up. >>reporter: and by transforming spartan military facilities into a chi-chi harbour for the jet set crowd it's a project that has got sea legs. >>murray kerr: the project has huge potential. the adriatic coast is pretty much what the cote d'azur was 50 years ago, all you need is a bit of infrastructure and ... a modern day brigitte bardot toput it on the map. >>reporter: and with yacht construction showing no sign of slowing down, an investment here could prove real shelter from our recessionary storm.

>> abirached: from humble beginnings in the usa's south eastern states, nascar has risen to become a behemoth of american sport. but it's heavily dependent on sponsorship, and a car industry sent reeling by the global economic crisis. we took a look at just what makes nascar special, and how it's coping with the recession. >>reporter: there's plenty of sporting entertainment on offer in the usa...little of it, however, as popular as the races laid on by nascar. >>giangola: if you look at attendance overall, the 20 largest sporting events in the united stateshis...17 of those 20 will be nascar races. so these are mega events. >>reporter: events that pull in over 7m passionate fans a year. >>i save all winter. but then i...this is what i do. >>we make it one way

or another. it's something we would not ever miss. >>curtis: we have all 50 states represented here. 25% of our crowds from canada, 60% comes from outof state. >>reporter: and where there are fans...there are sponsors...ones that last year injected around $1.5b into the sport. >>owen: there's absolutely no better venue out in america today to get your name in front of large audiences. 100000 people a week can come out to these things that attend...and then you've got millions and millions of more viewers that are at home. >>giangola: there's over 400 sponsors involved in nascar, which makes it the most corporate involvement of any sport in the united states. >>de jong: well. i guess the best way to describe this experience is with a few numbers. basically,if you've got 43, 800hp cars going round a 2 mile track at about 200mph in front of over 100000 fans...its brilliant. its absolutely brilliant.

>>reporter: and deceptively difficult. >>edwards: i can understand...it looks like we're just driving round in circles..the thing that's going on that's hard to see on television is the whole time we're cornering is you're getting the most grip out of the car...so the car is sliding the whole time. >>vickers: smaller tires, very little down force and a very heavy car...so it's a very difficult car to drive. >>reporter: and in the midst of a recession, nascar itself is finding things a little difficult...for starter, the sport's four car manufacturers have made heavy spending cuts this year. gm and ford by 20%...chrysler 30% and toyota by an undisclosed amount. tv ratings are down almost 20% on 2005's high water mark and attendances have fallen for four successive years. >>wolfe: when you look at most sports attendance is off a bit...with so many opportunities available for consumers to watch on television, television is down a little bit, but not more so than any other major sport. 12

>>giangola: we're seeing a slight softness in attendance. declines are in the single digits. 6 >>reporter: meanwhile teams, which need to rustle up around $20m a year to be competitive, have found the sponsorship money that makes up about 3/4 of their income, harder to come by. >>stewart: instead of necessarily having a 38 race season where they have one particular sponsor for 38 races. some of them now will sell a sponsorship for 20 races, and then another for 10, and thenanother for 8. >>reporter: over the last decade, nascar has been the fastest growing sport in the usa. in 2005 it signed an 8-year, $4.5b broadcast contract. but now it may have to work a little harder to sell itself. >>curtis: i don't want to say there was complacency...but we certainly were on a huge growth curve.now it's time to pause and take stock and recall why are we here. >>reporter: one idea reignited by the recession has been that of a franchise system which would guarantee licensed teams

an appearance on race day, important for sponsorship income and stability. currently teams need to qualify. but it's unlikely to happen...firstly because nascar is a family run, benevolent dictatorship that could see its authority diluted by franchisees, and secondly. >>stewart: the history of this sport has been the total opposite of that. it's been about a guy that has a shop down the street that builds a car and can enter it just like anybody else. so i don't know that they'll ever really get away from that model. >>reporter: but nascar isn't averse to radical change. 2 years ago, for example, it introduced the car of tomorrow a standard design to be used by all teams, created to cut development costs, and encourage more competitive racing....critics however, say it's just made passing more difficult, andracing less exciting, by artificially squeezing the field together. >>wolfe: i know it's a bit more difficult for the drivers to pass and it makes it a lot more challenging but from a fan perspective

your team could be right there to the end. 8 >>reporter: of course, nascar is still in a position many other sports can only envy. in the usa only the nfl draws more tv viewers, while average attendance thru its 10 month season is still well over 100000. and speaking from personal experience, you'll be hard pressed to find a more dedicated, enthusiastic, and friendly bunch of fans. >>what's this game called? >>cornhole. >>cornhole? why's it called cornhole? >>because the corn in the bag's gotta get in the hole. cornhole. >>this is a popular game at the nascar? >>it is. >>hello sir...tell us your name. >>tim thiry. >>tim what are you doing here and you've got a lovely bus i see. >>belgian by ancestry. >>you pretty good at the corn hole? >>not bad. >>that went straight in. >>reporter: as for the drivers, they're an accessible lot, and having taken a brief spin in the pace car, i could see

the attraction of an adrenaline fuelled career based on hurtling around a steeplybanked oval. >>you make a good living? >>edwards: yeah i make a great living. >>stewart: it's a great sport. it's an awesome sport. >>reporter: a sport however, facing something of a slowdown, before it gets back into the fast lane. >> abirached: that's it for this week's world business. thanks for watching. we'll see you again at the same time next week.

no. well, it's just past there. first house in the right after the cottage on the l don't panic. brazen it out. me? - no. - right. here goes. yippee!