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Good morning. Welcome to Business Today for Australia Network. Fitzsimmons. Coming up on the
program - acceptable range - China's Premier suggest s Beijing will China's Premier Beijing will intervene if growth drops below 7.5%. Resilient result - Apple posts better than Resilient result - Apple better than expected earnings as it taicts on his cheaper smartphone rivals. And sustainable design - how one entrepreneur grew a successful business out of a personal choice.Those stories coming up shortly but first let's take a quick look at the markets. On Wall Street there was a mixed decision. For more on the market action we're joined by Christine Ipp.The theme was consolidation overnight but the Dow did manage to reach an jowl time high. It was about earnings. Apple beat estimates and its shares were up 4% in after-hours trading. In other earnings we did see travellers missing the mark but United technologies which is considered a bellwether for the US economy did see a sol id result. Its shares rose 3%. So mixed session on Wall Street, investors Towke fauxusings on the corporate fundamentals.In the US, just take us through that data that was out there.It was very closely watched that data last night. We did see regional manufacturing activity from the Richmond Federal Reserve contract for July. I does signal the manufacturing contraction in an area which includes the district of column wra, Maryland and Virginia. What is so important about this DAT Datia is it does give investors food for thought on wha when the investor also move. The Fed has said they could reduce bond purchases as early as September but it depends on that US growth scenario. Disappointing data last night and we saw a loss of data
0.2% immediately after that data was released.The session Wass down-beat in Europe. What was weigh weighing there.Most markets traded lower but we the peripherals outperform. It was weighed down by news, micro technologies was down after reporting losses and KPM posted a second quarter profit of $107 million, missing analysts expectation. But merger and acquisition news from Vivendi and KPM did move and we saerds Heard from China's Premier Li Keqiang that could would Overall European stock s fell overnight and down from the 7-week high.What can we expect to see in local and regional trade today?The Australian share market is set for only a) quiet day today. The SPI is down 4 points. There is not a a lot of local data but the data will be the ASBC data that will be key for the Australian share market. We did see a solid performance from Asian expected on performance from Asian markets
yesterday and gave gains expected yesterday and gave gains are
expected on local - on regional markets for today.Thanks for markets for joining us.Thanks.Now let's
take a look at what's happening with currencies take a with currencies and
commodities: take a look at what's happening Aches markets were boosted by re assurances of China's leaders of where the region is heading: Investors took heart by comments from Premier Li Keqiang that the growth must not drop below 7%. In a statement he reinforced the message that Beijing is serious about reforms and shifting the economy from rapid expansion fuelled by dent, heavy investment and export s toward more sustainable growth. But he also tried to re assure markets that, while the new leadership had less ambitious growth targets than its predecessors, the Government could act if the economy slipped too far. The messages out of the region's economy are becoming more Cox plex and President Xi Jinping also said China needs to deepen reforms in an effort to address its economic challenges.But some analysts are warning China's growth could slow very quickly. Its economic transition isn't managed proper lir. Fund manager Roger Montgomery says investors should be repaired for expansion.China is deteriorating rapid ly and while many people point to its 7.5% growth rate, the reality is that growth rate could drop to as low as 4% or lower if in fact China doesn't transition well from its export lead and investment intensive economic growth to consumption growth. I think it's absurd to think that it's going to maintain a 7% growth rate as it tries to achieve that.Corporate expenditure, fixed asset investment in China is now 80% of GDP and two years ago it was 60% of GDP.So it's now a higher proportion of a lower rate of growth, which means the rest of the economy has fallen off the cliff and the Government is taking up the reins.Apple's share price has been boosted on slightly better than expected third quarter earnings. The tech giant reported a 6.9 billion dollar profit for the last three months helped bay record iPhone sales of more than $31 million nor the first quart er. IPhone salingses with just over 14.5 million compared to 17 million a year ago. Profits were 22% down on the same period a year earlier and profit margins were also lower, down from around 43 to 37%. Slowing sales and growth have put pressure on Apple to launch new products. Its shares jumped near ly 5% in after-hours trade, boosting the stock which has tumbled since last year's high above 700 dollars.PM Kevin Rudd will meet business and union leaders today to discuss how to increase productivity. Mr Rudd has called for a deal between government, business and unions similar to the 1980s accord. ACTU secretary Dave Oliver will be at the meeting and says innovation, training and better management are keys to improving productivity. Mr Rudd has called for a new national competitiveness agenda.Australia's corporate leaders are calling on politicians to back their words with deeds. The Institute of Company Directors says it's time to display a commitment to reducing costs and boosting productivity by cutting red tape. And it's released a white paper outlining policy priorities for the next got. With the election just around the corner, lobby group grievances are getting a good airing and company directors are no different.We're about 26% of their time is dealing with regulations, conforments and what have you. As opposed to dealing with more with entrepreneurial risk, performance of the organisation and promoting jobs, investments and those type of things.The Institute of company directors has released a white paper outlining a reform process designed to reduce red tape to boost productivity and competitiveness. It starts doing something about this, the massive increase in laws since the '70s which shows no signs of slowing down.The AICD wants the next government to call a regulation summit, bringing government and business together within the first 100 days of its term, aimed at mapping out a reform process that coordinates the removal of unnecessary legislation and the introduction of new laws.Too often new regulation is being developed on a knee jerk reaction for a one-off event
rather than reaction for a through rather than being developed
through proper regulatory processes involving risk base assess processes involving assess ment, consultation and proper cost assess ment, consultation analysis.The AICD is reluctant analysis.The AICD to point the finger Labor Government which to point the Labor Government which has been
accused of introducing policy on the run. Joining the chorus of complaints was Myer boss Bernie Brookes.We're not helped by the helped by the Government. I think we can't blame the Government for the changes that are taking place in the worldwide web.But he did blame Government force big differences in State and Federal laws, doubling the compliance and cost load. Also a concern is the business judgment rule defence. It's a defence against prosecution for a breach of directors duties as long as a director can show the decision was taken in good faith, the type of get out of jail free card. The AICD wants to see this defence widened for directors in Australia, as it is in the United States to encourage more jonlt pren yural decision making.We think as a director that this is where the company is likely to go. In Australia, you're reluctant to say that because of all the liability laws. We want to make the market work better than rather than being constrained. ThatThat is not how the corporate governance experts see it.The specific regular laces that have been put forward by the AICD need to be carefully examined. In particular the suggestion that the business document rule which would have seen the directors of James Hardie and of Centro not prosecuted at all should be treated with caution because there's no evidence really that we need to make such a radical change.One man's meat, another man's poison.It's an emotive issue across rural Australia, cashed up foreigners buy ing land and sparking the demise of the family farm. In the latest example, China's biggest state-owned agricultural Kofi Annan glomerate as for the first time invested in the automobile market buying up vast tracts of farmland in WA. As well as port facilities to ship its grain out of the country. While the foreign capital helps boost economic growth it's also breeding resentment.I just want to go over that asset register for the eastern property.Will Crozier has a lot on Liz mind. The former farmer from Geelong is now an international deal maker in fantastic.10 mls overnight.And the purchase of this farm four hours south of Perth is one of the biggest he's negotiated. It's part of a $150 million investment $150 million investment by China's largest agricultural company.The vision is massive. The development is massive. So far and it's only a start. This lays claim to being the biggest farming operation nkt it already grows 70 million tonneses of oh f grain globally and operates in more than 30 countries.But the purchase of more than 40,000 hectares of farmland in WA's south a the company's first foray into Australian agriculture and this is its first crop.They are the biggest farming operation in the world, I think it's 70 million tonnes of grain annually that they crop.This is the first time that we they have been introduced to Australia, Australian techniques, Australian technology, and Australian climate.Through its new Australian subsidiary, the company hasn't just bought the farm.It's also purchased port facilities at nearby Albany to vertically integrate its operations. This creates its own paddock to plate supply chain from WA to northern China.They 're going to be shipping the grain out of Albany. Are they going to be bringing in Empey ships or are they going to be filling them with their own machinery, their own fertiliser, their own chemical?Mary Nenke and her family are fourth generation wheat farmers in southern WA who have also diversified into yabby farming:These are business people. Tay will are not there for our good. They're there for their good. In our patch there are people paying up to 17% interest. These people will be - it will be Chinese money, what interest rates will they be paying? When you can't compete in your own country, what next?There is nothing to be afraid about, this is simply a new stream of capital coming in to rural Australia.At last count, around 11% of the nation's farmland was in foreign hands. But Bill Heffernan says no-one really knows what the exact figure is which is why it's crucial a foreign land registry is set up.We need to do that, then we need to model that out for 20 or 30 years given the present law and practices, and then say to ourselves is that where we want to be in 20 or 30 years as a nation because it's my view that, under the present arrangements we are re designing - redefine ing sovereignty.They're saying it's good for us. Would it be good if all city were owned by China and
then we were good if all our suburbs of the
city were then we were renting back the houses from then we were renting back houses from China?For Will Crozier, it's the way of the future.Northern producers have called on both sides of politics to do more to restore Indonesian confidence in Australian cattle exports. They're concerned that the election campaign might jeopardise the recent good will that has led Jakarta to ease restrictions on the half a billion dollar live trade. There's some movement at the station but no overseas trip scheduled yet for these cattle. This year gulf graziers have been hit with just about everything from bushfires to the beef cattle wasting disease BJD. That is everything except drevernling monsoonal rains and any interest from live cattle buyers.In would be about one boat for Carumba usually. One boat, one vendor.There's many worse off than Stan broke and this Australia. The resilient of cattle people this spread across Northern cattle people and Australia. cattle people and their businesses was the focus of a businesses was forum in Mount Isa that drew key stake holders across the northern beef industry.I am here to be your champion, loyal to your, your representative in the Cabinet, the person that goes in batting for you.Gulf graziers appreciate the attention they're getting from Canberra, but hope the same emphasis is directed to Jakarta.Building trust, building confidence, building bridges with our Indonesian neighbours is paramount to the success of getting the north Australian beef industry back on its feet.He is not the only Queenslander appealing for a bipartisan approach. Even in the midst of a robust election campaign.Visit Indonesia to slowly but surely start the process of re-establishing our export relationship with Indonesia adds we've been doing.State wise, federally, very important to work together.Good will or not, no-one up here is too sure how long it will take to sort out the markets for their surplus stock.The man accused of sending a hoax press release that caused the share price of Whitehaven Coal to plummet has been granted bail after appearing in court. Jonathan Moylan was charged by the Australian Securities and Investments Commission with making a false and misleading statement but the case has raised serious questions about whether ASIC has gone too far.At the time he sent his fake press release in January, Jonathan Moylan was un repentent.Change doesn't happen without people taking risk. The consequences to me could be very serious but nowhere near as serious as the impact that this mine is going to have on our water and our farmlands.Those risks landed the 25-year-old activist in the downing centre local court facing 10 Rears of making a false and misleading statement under corporations law. The charges stem from this, a stake document supposedly from ANZ saying it was draw wrau ing a loan for Whitehaven Coal's Maules Creek coal mine expansion. It looked real enough to fool the financial press and the stock exchange. And when it was reported as fact, shares in Whitehaven Coal slumped more than 300 million dollar s, forcing a trading halt and infuriating investors.Cleanly shaven and quiet, briefly in court quiet, Mr Moylan briefly in court flanked by
around

his lawyer to speak on his around 50 supporters.But left his lawyer to speak on his be
half.This matter his lawyer to speak on half.This matter is larger half.This matter is matter is about than Jonathan Moylan. of the environment of the forest, it's about the destruction of the environments t, about getting the public to know what is going on and the destruction of our rural communities.ASIC has cited the importance of market integrity to the Australian economy as its reason for pursuing the case but Mr Moylan's lawyer John Sutton has accused the corporate regulator of overkill.He has felt a massive weight of the law. One might draw the analogy of a sledge ma'am hammer to crack a nut.Some might question if ASIC has gone too far.In terms of the cases that ASIC has chosen not to pursue or been willing to settle for some sort of enforceable undertaking rather than taking people to court then in that context I think it seems over the top to pursue an individual with a charge that carries a 10-year jail sentence.Dr Dennis says ASIC should have bigger fish to fry?In recent years we've seen the collapse of ABC Learning and ap allegations about - allegation about systematic problems in the financial advice industry. There are Australians out there that are losing their lifesavings, as financial planners at times do things that are either inappropriate or illegal.Initially Mr Moylan apologised to investors who lost money because of his prank, outside the court his supporters reiterated that apology, but said their campaign to stop the mine expansion is paramount.It's the plight of the farmers with coal mining particularly, Jonno's brought the fact out that this is a very ugly project:. It's going to be a very dusty project, it's a very massive project.Jonathan Moylan was granted unconditional bail and will appear in court again in September.

It's often said that necessity is the mother of invention and this was the case when one business woman decided to embrace environment ally to friendly clo cloth nappies for her children. Lack lack lack came wum her own modern version, the design became so popular she soon found it difficult to keep up with demands and e decided to source her manufacturing from China. To finds out more about how she did this, I caught up recently be lack lack lack.Your company Itty, how did you come up with the idea and then develop the business?The idea came about because I wanted to use cloth on my children. I have been exposed to a few styles of new nappies where they put elastic in the legs and had got quite involved with a cloth nappy community. So I set about designing something that was slim fitting and trim and would make mums want to use it.So is the business developed how did you pursue manufacturing in China?In the beginning, I spent a lot of time doing a lot of research about the option, about where to manufacture. China was one of the option. We had actually looked at a few other places but China was the sort of best option. Also a lot of the fabrics to make cloth product, clothing, et cetera and particularly nappies with the bamboo comes from China. So I actually went on a little recky over to China before I started any manufacture and went around to a few different factoriesI wanted to make sure that whatever factory we used It was
was treated the workers well. It was really important that the staff that were making my products weren't in a sweat shop and weren't badly treated and were working in good conditions. So being able to go and see that was really important to me.What were the challenges in setting up your operations there?There is probably little things. Because it is my own product and design I am fa fussy about the small details and sometimes things would be missed, things weren't made exactly to speck. Generally speaking I was probably quite fortunate with how controlling I was almost because I got samples of everything and then got further safrm and then would produce. So that by the time I was getting my mass produced stuff I had gone through and eliminate add lot of the little errors. But I found to keep on top of everything I have to go there frequently and sometimes I can be battling with an for months I can be battling with an issue for months over email, phone and for months and I can go and have a meeting and things are sorted and I can go and have a five minutes.But of and things are five minutes.But of course
there are and things are sorted out in
five there are obviously manage there advantage s to having your operations there. What are those?The two main advantages for us and why we went there in the first place was to get the volume that we needed because we found that quite difficult because the business was growing so fast and in such huge demand we couldn't keep up. So being able to get the volume was one thing.S And obviously like every business that is faced with challenges of being viable and going into the future the costs of manufacture was important. We wanted to sheen ensure we could keep the business working at a profitable and sustainable manner. So manufacturing in China allows us to do that.So now you're actually looking at setting up your own factory in the region, it's a massive endeavour. Just tell me a little bit about what that entail?I guess as we have sort of grown as a business, we've had challenges with manufacturing, there's a as a lot of people have. I have had a few frustrations when I've wanted things to be done a certain way or I've wanted to find a particular fabric, all sorts of different challenges. I will ask, say, OK this is what I'm after, let's do that and they will be like I can't do that. I would be saying I am really sure you can do it and it will be a blanket no. Also we have had problems they am sure a lot of people have, with deliveries, things not coming when you want them looking at all of our
congression options when you want them to.And congression options we have looked at different manufacturers to see if that is something that would manufacturers something that would maybe help us. We have sort of kept coming back to this if we set thimgs s things up ourselves we have a lot more control over everything frtion we can source the raw materials.Manufacturing your product in the region, how concerning is it to protect your intellectual property and the design?Of course that is an issue. There's a lot of intellectual property issues that go on in China.I guess spent many hours in China discussing things with various people over there and there's a really big cultural difference between Australia and China, I find. Things that we would consider taboo are considered fairly normal culturally over there.They ripping things off and just making tiny changes is not frowned upon because they say it's different. That has been really challenging for us but part No-one was doing more to No-one improve discipline No-one was doing improve discipline in the young Australian team than I improve discipline in the Australian team than I was. So
we're hearing that Australian team we're hearing that he might
have a bit to say to the media as he walks in to as he walks in to this commission hearing. So we will just stop for a moment and hear what Mickey Arthur has to say.Morning..: . (Inaudible) (PROBLEM WITH SOUND)
So unfortunately obviously we had a few audio problems there with Mickey Arthur saying a few words as he heads into that conciliation hearing at the fair work Commission.Hopefully we will have those audio problems fixed by the time he gets out. But Mickey Arthur saying that his career has suffered immense damage from that move by Cricket Australia to sack him before the Ashes Test.And going in for that hearing he's demanding $4 million in compensation or his reinstatement as coach.Obviously as I said we will keep across that through the day and see if Mickey Arthur has anything to say when he leaves that hearing in Sydney this morning.To other news of the day - at least one person is reportedly dead after an asylum seeker boat bound for Christmas Island began sink off the south-west coast of the Indonesian island of Java last night. The boat carrying as many as 100 people left a fishing village yesterday morning. They only
got a few kilometres out to sea after hitting heavy at least south-easterly winds. The maritime safety authority has confirm add rescue operation is under way.Indonesia correspondent George Roberts joins us now on the phone.Tell us where you are and what the situation is with this boat.Well, we're in the Punhuk area on the way to the coast. We have broken down. That is not helping us oust out. This is sort of asylum seeker country where thousands of people gather on their way to the coast with I is where we're trying to reach so we can
cover this story. The latest we have from the head of search and rescue, the operational head in West Jaffe are a man called Adrian Shah is they suspect about 200 people were on board, so that is revised up from that figure of 100. But these figures often change. So bear in mind that could change later. Local media reports are that one child is dead and 47 people have been rescued. That is coming from one of the major TV stations here, one of their reports who is in the area there on the coast. Scbr theThe local authorities are saying that 30 people have been saved so far.As you understand it, when did this boat, what were the reports saying when this boat actually left the Indonesian coast and how long was it before it got

sinking, is it still upright right now or the hull is overturned or has it sunk? Have you heard any details?The search and rescue people West Java say they're still two hours a-awa. So this information is still early on. This information is coming from the search and rescue people who have got it from the nave ynd it's about third hand at this stage, it's hard to say exactly what is going on. That's why there are two different source of information coming through, the 30 people saved apparent ly by local fisher men but others say 40 people have been saved and one child dead. As far as leaving the coast goes, given the proximity of this boat to the mainland, it's fair to assume that it would have - if it left a north Java from the port in Jakarta, then it would have left in the path 24 to or if it left in a place closer left in the path 24 to 48 hours or if to Christmas Island or if it left in a

into trouble? And also is it