Asia-Pacific

Freer yuan sends the right message

16 Apr 2012

Widening the Chinese currency’s trading band will make the central bank’s life easier, and greater volatility should deter foreign inflows. A more hands-off approach should also pacify trade partners. It’s a small but decisive step that shows deeper reform is still on the agenda.

Infosys U.S. woes tarnish India’s star sector

16 Apr 2012

Outsourcing was a bright spot amid worries about India’s growth prospects. But an investigation into alleged visa violations by Infosys could herald a tougher time for the industry. Until the IT group’s papers are in order, investors have another reason to shun Indian stocks.

Growth is the least of China’s three big worries

13 Apr 2012

GDP increased 8.1 percent in the first quarter - slow for China and a little worse than expected. But those missed basis points are not a big risk for the economy. More telling for investors are ongoing political ructions and a banking system that could easily fall into crisis.

South Korean election rewards decent economic job

12 Apr 2012

Park Geun-hye’s ruling party victory in legislative elections is a reflection of her predecessor’s success in overcoming recession and nurturing growth. If she wins the Blue House in December, Park even has a shot at conquering the remaining ills of corruption and corporatism.

Sony’s overhaul doesn’t go far enough

12 Apr 2012

The new CEO aims to reverse $6.4 bln in losses by rewiring the TV unit and pushing further into smartphones and medical devices. One-off charges now may flatter earnings later, but the tech company may need new equity to expand. Sony needs deeper cuts and more radical re-rigging.

India can risk a bold rate cut

12 Apr 2012

The Reserve Bank of India has trouble guiding the economy because so little of the population is connected to the financial system. But with growth slowing, there’s a good case that a rate cut now would encourage investment and production - without encouraging inflation.

China’s grip on rare earths market looks fragile

12 Apr 2012

High rare earth prices won’t last forever. Beijing’s drive to shut dirty smelters may support prices near term. But miners elsewhere will be better placed as Chinese producers are held to higher standards. As new mines come online, greater competition should bring prices down.

Ethical economy: Towards a better society in China

11 Apr 2012

The Chinese Communist Party has changed with the country it rules. It wisely moved away from naïve Marxism with the Three Represents mantra. But the richer country needs a firmer and wider social and political base. It’s time to work on the Five Responsibilities.

Bo’s fall reveals China’s cult of anti-personality

10 Apr 2012

The former rising star’s removal from the Politburo, though expected, is a sign that the ruling party has no place for leaders with a penchant for self-promotion or wives who court scandal. Today’s ambitious Chinese politicians should be outwardly bland and keep misdeeds quiet.

China’s positive data hides healthy economic pain

10 Apr 2012

Surprisingly high inflation and a big monthly trade surplus are misleading. Producer prices are falling and exports slowing. But the news is not bad enough to provoke monetary stimulus. Reformers think slowing growth pains are required to make China’s economy more balanced.

Singapore may not escape India’s offshore tax grab

10 Apr 2012

The country’s tax crackdown is likely to prompt an exodus of investors from Mauritius. Some are already shifting their operations to Singapore. The city state is a better established financial centre. Nevertheless, the very act of hopping islands may look like tax avoidance.

World Bank wackiness explains odd U.S. choice

9 Apr 2012

If the competition for the World Bank’s presidency were a normal process, Jim Kim wouldn’t stand a chance. But geopolitics and the bank’s mandate explain why the doctor who couldn’t stop Dartmouth frat boys from consuming “vomelets” may actually be an inspired choice.

Tata’s new guard can break open old markets

4 Apr 2012

Cyrus Mistry’s first major appointment is a young charismatic head of business development. Tata may be one of the few groups with the political and economic clout needed to breathe new life into India’s retail and financial services markets.

Bank of Japan divisions point to stronger yen

3 Apr 2012

The bank talks about fighting deflation, but has done relatively little. Replacing two board members with inflation doves when the seats open on April 4 won’t end the impasse. As long as fears of higher borrowing costs stop the BoJ from printing money, the yen will defy gravity.

Quality of life may one day dethrone NY, London

2 Apr 2012

They’re still the most global cities, A.T. Kearney reckons, with Paris and Tokyo next. But Vienna, rated only 13th among global cities, tops Mercer’s quality of living list. As technology makes location less critical, life quality may matter more. Auckland or Vancouver, anyone?

Temasek on top in SE Asia bank stake swap

2 Apr 2012

The Singaporean fund will exchange its stake in Indonesia’s Bank Danamon for an enlarged slice of DBS, a bigger lender based in its home state. The price is high and there are integration dangers for DBS. But if all goes well, Temasek will enjoy a windfall of almost $2 billion.

Myanmar vote doesn’t give clear win to investors

2 Apr 2012

Aung San Suu Kyi’s by-election win is a big step to democracy, which may bring the end of sanctions. The simultaneous freeing up of the exchange rate is a step to a market economy. But the path to democracy is still uncertain and Suu Kyi’s views on foreign investment are unknown.

India can’t afford a foreign investment collapse

2 Apr 2012

If the latest tax spat goes beyond sulking and investment actually starts to freeze up, India could face a balance of payments crisis. A coordinated letter from international trade associations is as much a rallying cry to investors as it is a message to the Indian government.

Sweat-free iPads come at a price worth paying

30 Mar 2012

Apple scores points for pushing to improve life for workers at the Foxconn “iGadget” factories in mainland China. But change may have been inevitable thanks to rising wealth and labour shortages. Consumers, ultimately, may have to foot the bill, but they should be OK with that.

Hong Kong still haven for tycoons – and investors

30 Mar 2012

Two property moguls have been nabbed by the corruption watchdog. It’s a welcome sign that the city’s plutocrats aren’t untouchable. While conspiracy theories abound, they are far-fetched. If politicians wanted to clip the tycoons’ wings, there are more effective ways to do so.