Asia-Pacific

China’s stock reforms should benefit brokers most

3 May 2012

New rules like lower trading fees are designed to boost China’s stock market, which trades at a discount versus its Asian peers. New kinds of trading and higher underwriting volumes should help struggling securities firms, but may disappoint investors hoping for higher stock prices.

Dissident solution bodes well for China and U.S.

2 May 2012

The blind activist is safe and still in China. Beijing and Washington avoid a diplomatic incident and can each claim victory. The U.S. comes out as a defender of human rights and China can uphold the rule of law while complaining about interference.

Australia’s rate policy dragged in two directions

2 May 2012

The central bank’s rate cut looks like a response to a slowing China, which will weigh on Australia’s commodity exports. Yet that exposes it to new risks. Australia has built up a reliance on foreign investors to fund its current account deficit. Lower rates could scare them away.

India’s bullish consumers need investors to match

2 May 2012

Buyers seem fairly oblivious to India’s economic woes. See Hindustan Unilever’s strong showing. And India’s consumer is the most optimistic in the world, says Nielsen. But booming consumption needs investment that can keep up, otherwise the result will be more inflation.

China and U.S. should avoid human rights fight

30 Apr 2012

A dissident takes refuge in the U.S. embassy in Beijing. It’s a diplomatic crisis, but both sides have reason to want a face-saving resolution. Though Washington defends human rights, it needs a stable and cooperative China. Beijing, meanwhile, has a chance to improve its image.

The rupee looks vulnerable

30 Apr 2012

India’s ballooning trade deficit means it has to run just to stand still. Without steady capital inflows, the currency will collapse. The rupee’s 19 percent fall against the dollar over the past year is worrying. Predictions of further decline could become self-fulfilling.

Nomura stabilises, but at a low base

27 Apr 2012

Earnings jumped in the last quarter, lifting the Japanese bank to a full-year profit. Healthier equity markets at home and better global trading both contributed, while past cost-cutting should help in the coming year. But Nomura’s weak returns mean it has much more to do.

Samsung moves on from Japan to nibble at Apple

27 Apr 2012

The Korean company learned by pulling apart Japanese electronics, then reverse-engineering the business model. Having taken the lessons, it has built a commanding position in TVs and smartphones. As Apple tackles emerging markets, Samsung is showing it is still hungry.

Weak exports bring double whammy for Chinese banks

27 Apr 2012

Chinese lenders kept the country from a crisis in 2008. But now they’re facing a squeeze. Deposits are harder to find, thanks to the decline in the automatic inflow from the shrinking trade surplus. Meanwhile, losses are rising on loans to smaller businesses hit by poor demand.

People’s Daily website shows profit in propaganda

27 Apr 2012

The flotation of People.cn, the online version of China’s People’s Daily, gives it a value larger than the New York Times. It gets government subsidies and advertisers love that it reaches so many officials. Western media companies can hardly ape its ways. But they are enviable.

Thailand’s weak exports don’t dent recovery story

26 Apr 2012

Rebuilding after 2011’s floods should produce a V-shaped recovery. Falling European demand is a worry, but investment is booming and output should rebound as factories reopen. Government handouts will prop up rural consumption. That augurs well for earnings and stocks.

Jailing IPO bankers is a step too far

25 Apr 2012

Hong Kong talk of allowing lawsuits against negligent sponsors sounds fair. Reputation isn’t the safeguard it was. But the regulator’s idea of adding criminal liability may just damage the market’s efficiency. And it misses the real problem: investors lap up overpriced deals.

JPMorgan sends big gun after small bounty

24 Apr 2012

Deploying its global head of investment banking, Jeff Urwin, to run things from Hong Kong may help Jamie Dimon catch up with regional leaders UBS and Goldman. But given Asian deal fees are just a fraction of the total pool, Urwin’s frequent flyer miles will probably grow faster.

Cuba unveils a Hugo Chavez hedge: economic reform

24 Apr 2012

With the island’s last rich patron battling cancer, Raul Castro may finally see the writing on the wall. If he can reduce the state’s role in the economy and relax restrictions on capitalist activities, Cuba’s future won’t be North Korea or even Vietnam - but rather Turkey.

DBS deal tests Indonesia’s deep Singapore-phobia

24 Apr 2012

Even a 52 percent premium may not secure the Singaporean bank’s $7.2 bln takeover of Bank Danamon. A deal would benefit all sides and burnish Indonesia’s image as a hot investment destination to boot. But looming elections and longstanding mistrust may trump commercial logic.

China’s "investment imbalance" is mostly fictional

24 Apr 2012

Chinese investment is excessive, wasteful and will ultimately cause serious trouble. That claim has been around for years. The growth sceptics may eventually be right. But their logic is weak and their statistics doubtful. They also underestimate the government’s ability.

Fund managers are losing patience with India

24 Apr 2012

Foreign investment in the country’s equity market has slowed to a trickle. Ambiguity over tax changes is a major reason investors are holding back. India’s fragile economy can’t risk an exodus. But the rules haven’t yet come into law. The government still has time for a re-think.

China bank pay is the wrong target for reform

24 Apr 2012

In what looks like a response to public complaints, some Chinese bank chiefs have had their pay cut. Others are getting raises, but still earn a pittance. Yet the industry’s earnings grew 36 percent in 2011. It would be better to address the lack of competition that enables the banks to do so well.

Cambodia must solve two big problems for takeoff

23 Apr 2012

Cambodia’s stock exchange opening shows the country’s relatively friendly attitude to foreign investors and markets. But meeting the needs of a rapidly growing population and reducing corruption stand in the way of the rapid growth other Asian tigers have delivered.

How China can avoid a corruption crisis

20 Apr 2012

Graft need not stop growth in resource-rich countries. But China’s main resource - cheap labour - is running out. The distortions from decades of corruption could soon slow the economy. This burden can be lifted, but that requires breaking some idols, and bending some rules.