Asia-Pacific

Dropped Aussie coal bid calls end of go-go days

24 Aug 2012

The timing of Nathan Tinkler’s abandoned bid for Whitehaven Coal is apt. A day earlier, Australia’s mining minister caused a ruckus by declaring the resource boom “over”. Mining isn’t finished. But the debt-fuelled approach favoured by this Australian magnate may be.

Indian politics turns from hope to fear

24 Aug 2012

With elections looming, the government’s economic story is deteriorating. And so, as a result, is its politics. When all else fails, communal tension helps shore up the bases of both main parties. That helps them in the face of strong regional parties. But it’s a disaster for India.

It’s risky to be big fish in murky Vietnam markets

24 Aug 2012

The arrest of tycoon Nguyen Duc Kien has roiled the country’s tiny stock market. Never mind that he no longer controls the bank he founded: with weak banks, widespread corruption and poor governance, investors fear that if he goes down, he may take the financial system with him.

Thais should tone down populist rhetoric

23 Aug 2012

A top official says the country’s foreign reserves are doing “nothing useful.” A swap of low-yielding U.S. Treasuries for roads and bridges sounds tempting. But the actual economics are doubtful, Thailand isn’t secure enough for the risks and the timing is terrible for investors.

Beijing insecurity creates sure corporate winners

23 Aug 2012

The government is worried about social order, so while a slowdown in public spending has hit some companies hard, providers of video surveillance and state media are doing well. When times are tough, Chinese authorities are willing to invest in maintaining stability.

Korea, Taiwan are global stimulus weather vanes

23 Aug 2012

The two export-reliant economies are suffering as global growth slows. Yet foreign investors have been snapping up their stocks to wager that China, Europe or the U.S. will respond with major stimulus measures. If they do, Asia’s exports could be among the first beneficiaries.

Spending still needed despite mine capex cull

22 Aug 2012

BHP Billiton’s decision to shelve a $20 bln Australian copper and uranium dig shows reassuring discipline. As lower returns challenge more marginal projects, investors may ask miners to shovel even more cash in their direction. The biggest miners can afford to think longer term.

China has no liquidity problem. That’s a problem.

22 Aug 2012

Beijing has managed to keep credit and cash growing despite falling property, profit and slowing growth. That may help China avoid the kind of liquidity trap that made the U.S. recession so painful. But it could encourage the behavior that has kept Japan in a slump for so long.

South Korea can’t kick debt habit

22 Aug 2012

Loan limits for younger homebuyers have just risen by about 15 percent, thanks to a decision to let lenders estimate borrowers’ future incomes. More credit might help counter the current weakness in demand, but will only increase the stress on Korea’s over-indebted households.

Goldman still on wrong side of China’s great wall

21 Aug 2012

Eight years ago the bank hit on a clever trick to tap China’s restricted equities market. But while Goldman’s franchise thrived, its equities business hasn’t. Two Goldman vets and China novices have now been shipped in to enliven things. The best thing they can bring is patience.

China’s oil giant may need pricey Canadian boost

21 Aug 2012

CNOOC’s $15 bln tilt at Canada’s Nexen seems an expensive distraction, especially since the Chinese oil major has cut its dividend, has flat output and rising costs. Yet CNOOC needs a booster. Nexen’s drilling expertise could help it squeeze more out of its domestic business.

Malaysia might escape middle-income trap

21 Aug 2012

The government’s efforts to support the Malay majority have hollowed out the nation’s talent pool and hurt growth. Encouraged by a boost in public spending, private sector investment rose at a 25 percent rate in the second quarter. That could make faster growth self-sustaining.

Time to draw a line under India’s crony capitalism

21 Aug 2012

India’s national auditor has once again highlighted too-cheap sales of state assets. Going forward the answer is simple: auctions that are transparent and profit-maximising. The past is harder to clear up. The government and business community need to show they’re sorry.

Gu Kailai verdict may play better than Pussy Riot

20 Aug 2012

In some ways, China’s hasty murder conviction of a politician’s wife resembles Russia’s farcical prison sentence for a punk protest. But the Russian case inflames fear of excessive state control, which is bad for markets. In China, investors may be happy that order has prevailed.

Thais have done well in APB bluff against Heineken

20 Aug 2012

The Dutch brewer blinked after a Bangkok beer family threatened to block it from full ownership of the Singapore brewery. Heineken raised its bid to $4.46 bln. The Thais could try for still more, but risk a devastating loss if Heineken balks. They’d be savvy to cash in now.

Noodle king Tingyi bulks up in lean China market

20 Aug 2012

Chinese consumers are becoming more frugal, even over staples like bottled drinks and instant noodles. Yet market leader Tingyi grew sales in a weak market by taking share from rivals. Lower palm oil and sugar prices also helped produce a 24 percent rise in first-half profits.

Beijing’s universal bank plan falters overseas

17 Aug 2012

China’s big four banks hired wildly and invested madly abroad in 2009, when Western banks stumbled. After CCB’s investment banking unit lost $250 million in 2011, they are all cutting back. A much needed strategic rethink of their global ambitions is under way.

Review: How the West both lost and won Asian minds

17 Aug 2012

From Egypt to Japan, intellectuals have spent much of the last 150 years trying to respond to the temptations and horrors of European culture. Pankaj Mishra traces out the uneasy mix of emulation and rejection. Modernisation was hard then and isn’t much easier now.

Delhi’s mission to Mars more than confectionery

16 Aug 2012

It may seem wasteful to launch satellites when half India’s children are malnourished. But the $80 mln at stake is relatively small, and symbolic feats can pay economic dividends. Besides, it will take more than abandoning a space programme to close India’s massive wealth gap.

New optimism may torpedo Asia’s safe-haven bonds

16 Aug 2012

Investors driven by weak global growth, low interest rates and strong Asian finances have sought shelter in the region’s bonds. But Asia’s growth hasn’t fallen as fast as feared. If the U.S. or China move to revive growth, those bonds could prove vulnerable to a brightening mood.