Government & Agencies

Coldplay gives Hong Kong rush of blood to the head

17 Oct 2024

The UK band’s sold-out concert suggests the struggling economy’s affluent locals have plenty to spend. Yet city leader John Lee reckons policies like streamlining mortgages and IPOs will foster growth. He’d do better finding ways to help the less well off boost consumption.

China’s woes make Plaza Accord 2.0 less outlandish

16 Oct 2024

If Donald Trump becomes US President, he wants a weak dollar and taxes on Chinese imports. He may use the threat of tariffs to get Beijing to boost the yuan, an echo of the 1985 Plaza Accord. A strong currency hurts growth, but a trade war could be worse for President Xi Jinping.

Measured UK tax hike can avoid dealmakers’ Brexit

16 Oct 2024

Chancellor Rachel Reeves has to raise money in her Oct. 30 Budget and may up capital gains tax from 28% to 35%. That would require 2,000 buyout barons to pay $120,000 extra on their funds’ profits. Such a small hit would probably stave off a threatened private equity exodus.

India’s moment is hurt by interference label

15 Oct 2024

New Delhi called Ottawa linking its agents to homicides "preposterous" as the countries expelled each other's diplomats. A similar US case has higher stakes. If the saga shunts perceptions of India into the same bucket as China, its status as a land of opportunity will suffer.

Putin’s economic resilience rests on war addiction

15 Oct 2024

Sanctions and the fall in oil prices have hit the Russian economy. But growth has outpaced expectations since the 2022 Ukraine invasion thanks to high military spending, now at more than 6% of GDP. The reliance on ongoing conflict hides President Vladimir Putin’s vulnerability.

UK tax threat revives gambling stocks’ M&A saga

14 Oct 2024

Entain and Evoke shares fell over 10% on reports of a 3 bln pound tax hike on the sector. After a troubled few years in which it was a target for MGM, debt-laden Entain had looked on the mend. If Britain turns the fiscal screw, smaller players may need to bulk up.

Nobel prize brings global inequality back in focus

14 Oct 2024

Economist Daron Acemoglu and two colleagues shared the Swedish award for showing why some countries are rich and others poor. Their findings – democracy and rule of law matter – are a reminder that huge disparities in income among, and within, nations remain a festering issue.

Old theories offer new insight into global rivalry

14 Oct 2024

The geographer Halfold Mackinder in 1904 proposed that future strife would revolve around control of Eurasia. Though the modern world is very different, it’s one way to understand conflicts in Ukraine and the Middle East and the showdown between the United States and China.

Italy has more to gain from France’s pain

14 Oct 2024

Rome borrowing costs are converging with Paris. Prime Minister Giorgia Meloni’s stable government is pledging to contain its deficit and pushing through reforms, at a time when its peer is in turmoil. To press home the advantage, though, Meloni will need to take bolder action.

China stimulus aims at its greatest wall of debt

14 Oct 2024

The finance ministry pledged to tackle local government borrowings. It reveals an intent to smash systemic financial risk and, by not rushing to support consumer demand, a desire to avoid repeating past spending mistakes. Beijing's plan is welcome but still missing key details.

France heads toward aimless short-term austerity

11 Oct 2024

PM Michel Barnier’s deficit-reduction plan mostly relies on 30 billion euros of tax hikes next year. That will hit growth just as corporate investment and consumer demand are flat. Long-term spending cuts would be a better solution. But this weak government cannot provide them.

UK government can still trip over lower fiscal bar

11 Oct 2024

Chancellor Rachel Reeves needs an extra 31 bln pounds in public investment by 2029 to boost the country’s anaemic growth. Easing the spending rules is a start. But without a clear plan and return targets, the Labour administration will fall into a debt trap of its own making.

China’s stock market bazooka is yet to fire

10 Oct 2024

The People’s Republic recently unveiled a raft of measures to solve a housing bust and support the market, producing a pop of post-vacation enthusiasm. That’s now waning as investors await a bigger move. In this Viewsroom podcast, Breakingviews columnists discuss what comes next.

China’s EU reply cuts odds of damaging tit-for-tat

8 Oct 2024

Days after Brussels voted for electric-vehicle tariffs, Beijing penalised European brandy. Pork, dairy and pricey cars may be next. Yet the moves are well-flagged. And more damaging retorts, like hitting luxury or $9 bln of aircraft-linked imports, seem unlikely for now.

Ireland spins global tax mess into $28 bln of gold

8 Oct 2024

Dublin expects a 2024 budget surplus worth 8% of gross national income, thanks to the presence of US companies lured by low levies. It’s evidence that profit shifting lives on despite a landmark OECD deal. The good news for Ireland is that there’s little chance of that changing.

Tokyo Metro IPO is a big deal with big caveats

7 Oct 2024

Japan’s largest listing in half a decade comes to market with rising passenger traffic and solid earnings to back its $2 bln share sale. The subway operator also carries a sizable debt load and a massive stock overhang that raises questions about the government's ownership.

EV tariffs are only the first step in EU-China war

4 Oct 2024

Despite internal squabbles, member states voted for levies on imported Chinese battery cars. That may help onshore production, but doesn’t tackle China’s clout in hybrid vehicles and batteries. New trade battles are likely: autos and their supply chains are in the firing line.

French PM has a plan but lacks time to fix budget

4 Oct 2024

Michel Barnier is proposing 30 billion euros of spending cuts and tax hikes to shrink the country’s deficit. Even if a divided parliament approves, he will have to repeat the feat in future years to fill the fiscal hole. This government’s weak hold on power makes that unlikely.

China and India reveal emerging market mistakes

3 Oct 2024

Investors often assume stocks in developing countries track economic growth, while valuations are a guide to future returns. The diverging path of Chinese and Indian equities over the past decade shows the flaws in this approach. Better to pay attention to capital efficiency.

Greece is unlikely victor in bank selldown race

3 Oct 2024

Athens sold 10% of National Bank, effectively ending the privatisation of the major lenders it rescued. Germany, the Netherlands, the UK and Ireland still own bank stakes. Greeks can thank continued government support and a strong economy, fuelled by rising investment.