Asia-Pacific

Hu throws down gauntlet with Chinese GDP target

8 Nov 2012

The outgoing president has called for the country to double output per head by 2020. That implies annual growth of 7.3 pct to the end of the decade - a whisker below this year’s official goal. That’s only achievable if Hu’s successors make changes he and his generation didn’t.

Obama’s victory is a clear win for Asian assets

8 Nov 2012

Markets see-sawed after the presidential election as investors disagreed about whether four more years are good or bad for the economy. But whether the U.S. falls off its fiscal cliff or quantitative easing sparks a robust economic recovery, more dollars seem destined for Asia.

Pre-crisis rating laxity still has power to shock

6 Nov 2012

An Australian court has held S&P and ABN Amro liable for investor losses on AAA-rated CPDOs sold at the height of the credit bubble. S&P will appeal. Whatever the result, the ruling exposes the interplay of cynical bankers and inept raters. Today’s watchdogs should take note.

QE-lenient world gives Vietnam financial pardon

6 Nov 2012

Even after a downgrade by Moody’s last month, investors are willing to lend Hanoi dollars for less. Rising exports helped avert a balance of payments crisis and officials apologized for economic goofs. But in a world awash with cash, investors are too eager to forgive and forget.

HSBC still aiming at its moving targets

5 Nov 2012

The emerging market bank’s costs are still above CEO Stuart Gulliver’s goal, and returns still below. One-off charges for UK mis-selling and U.S. money-laundering are partly to blame. But if these prove a recurring cost of doing business, HSBC’s targets may need adjusting.

Chinese reforms could trigger domino effect

5 Nov 2012

To sustain growth and make citizens happier, new leaders must tackle three big challenges: financial efficiency, innovation and the environment. But each policy tweak depends partly on others. As before in China’s history, success is based not on intent, but on political capital.

Asian rice producers’ cartel is a bad idea

5 Nov 2012

Having spent $10 billion to buy rice paddy from farmers at above-market rates, Thailand must dread being forced to sell its stockpiles at the prevailing low prices. But forging an alliance of Southeast Asian exporters won’t give Bangkok more pricing power: unlike oil, rice rots.

Japan risks consumer electronics death spiral

2 Nov 2012

Panasonic, Sony and Sharp all suffered slumping demand for consumer gadgets. Though the economy is partly to blame, so are successful rivals like Apple and Samsung. The temptation may be to cut product development spending, but that could leave the trio ever further behind.

Pigeons and paranoia belie China’s surprising calm

2 Nov 2012

Flying pigeons, opening taxi windows and buying knives are among the activities banned in Beijing during China’s leadership handover. The anxiety shows cracks in the system, but what’s remarkable is how China remains basically stable, and not all because of heavy-handed measures.

China web truce may strengthen Baidu’s hand

2 Nov 2012

A trade group has asked major companies to sign a code of conduct to moderate rising tensions in the search market. If this helps to slow down upstarts like Qihoo, dominant player Baidu stands to benefit most. But for users, the impact is likely to be mixed.

China “hard landing” talk abates, but not for long

1 Nov 2012

A return to growth in the key PMI survey, and a pick-up in the Breakingviews Tea Leaf Index, suggests China is on track for above-7.5 percent growth in 2012. Credit growth has been sustained and a property slump avoided. But the fragilities that worry China bears are still there.

HK’s move to promote women in boardroom is overdue

1 Nov 2012

The pro-business city is catching up with financial centres and Asian neighbours in proposing listed companies state their diversity policy. As in many other countries, women are under-represented on boards. Improving awareness of diversity is the least regulators can do.

Ethical economy: Admit economic ignorance

31 Oct 2012

Policymakers may still sound sure and pundits admit few doubts, but most key questions remain unanswered, even though it has been four years since Lehman Brothers’ collapse blindsided economic visionaries. Unless a new Keynes comes along, expect more stumbling in the dark.

Europe, China holding back Asian export recovery

31 Oct 2012

Gains in September exports have buoyed hopes for a U.S.-led rebound in regional trade. But Asian economies have shifted their focus to Europe and responded to Chinese competition by supplying the manufacturing juggernaut. A U.S. upturn alone won’t revive Asia’s export engine.

UK nuclear deal a step forward in challenging slog

30 Oct 2012

Hitachi’s $1.1 billion purchase of a big nuclear power project is a victory for the UK government. The Japanese group is an attractive partner, with a reputation for delivering on time and on budget. But policymakers need to deliver in three big areas for the project to succeed.

Three reasons China’s banks deserve their derating

30 Oct 2012

The biggest lenders trade at just 1.2 times book value, despite returns on equity above 20 percent. Why? Because healthy reported numbers don’t reflect the risk of bad debts rising, the squeeze on bank deposits, or the likelihood that some will need more capital.

Bank of Japan fails the shock-and-awe test again

30 Oct 2012

The central bank’s decision to print an additional 11 trillion yen was neither impressive nor surprising. The BOJ’s own gloomy assessment of the economy suggests that the predictable timidity of its moves is blunting its ability to fight deflation.

Activism undermines Beijing’s investment-led model

30 Oct 2012

Violent protests in Ningbo forced Sinopec to cancel a planned petrochemical plant. The latest in a series of demonstrations could further embolden resistance to new projects and forced relocations. Less compliant citizens are another reason China needs to find new ways to grow.

Petronas return may herald Canada M&A clarity

30 Oct 2012

Ottawa botched its initial veto of the Malaysian oil group’s $5.2 bln bid for gas producer Progress. Nerves over CNOOC’s bigger offer for Nexen played a part. Petronas is back, but if the government wants the benefit of the doubt next time it needs to make the rules less fuzzy.

Hong Kong’s anti-foreigner property tax may spread

29 Oct 2012

Non-resident buyers have been whacked with an extra 15 percent stamp duty as the territory battles the effects of cheap money and capital flight. The political appeal is likely to outweigh the bad side effects. Other urban hot spots, like London, may be tempted to follow suit.