Regulation

China’s march to strong yuan is long and perilous

26 Sep 2024

President Xi Jinping wants a more powerful currency. This means increased usage of the renminbi in global payments and central bank reserves, rather than replacing the dollar. But Beijing’s desires for bigger forex heft clash with its need to keep a tight grip on the economy.

Skimpy financial disclosures leave plenty exposed

25 Sep 2024

Few rules require detailed reporting from public companies, leading to variations that frustrate investors. Consider Temu owner PDD’s scant info versus $390 bln Home Depot’s extra granularity. Corporate bosses may fear accountability from openness, but opacity often stings worse.

Beijing IPO meddling leaves bad taste in Hong Kong

23 Sep 2024

Regulators have put three bubble tea firms’ offerings on hold. Why? Because listed peers have performed poorly amid tough competition, Reuters reports. That may be true, but it’s a decision for companies and investors. China’s heavy handedness bodes ill for the city’s bourse.

Europe’s CO2 fines undermine carmakers’ progress

19 Sep 2024

An auto lobby group called on governments to ease 2025 carbon penalties. Modest relief would help. With EU electric-vehicle sales down 8% year-on-year, Europe’s plan to end combustion engines looks dicey. That’s more down to government inaction than big-spending carmakers.

Beijing’s pension plan grasps at a utopian reality

17 Sep 2024

China is raising the retirement age for the first time since the 1950s, and increasing the number of years workers must contribute to receive payouts. Both thresholds remain low but policymakers are right to tread cautiously. Boosting the workforce in a slowing economy is risky.

For global firms, India IPOs are a honey trap

17 Sep 2024

Hyundai and LG Electronics are each keen to float their local subsidiary on Mumbai bourses. Rich valuations are on offer. Companies have been burnt, though, by chasing additional listings around the world. The risk of getting hurt looks particularly bad in India.

ASML faces bigger problems than China

16 Sep 2024

Fears of US tech export curbs have pummelled the $320 bln Dutch firm’s shares. A longer-term worry is that the growth of AI leads to new technologies, and less need for ASML’s machines that make chips smaller and efficient. That, more than trade wars, may hurt its rich valuation.

The UK’s finance-business chasm is as wide as ever

13 Sep 2024

British investors and regulators are fretting that capital markets do not adequately serve local companies. The long-running issue is rooted in the country’s outsized financial sector, which brings in 12% of GDP. Recent reforms will struggle to address the underlying problem.

China wins only token victory in EU car wars

13 Sep 2024

Spanish PM Pedro Sanchez wants Europe to drop duties on Chinese EVs, suggesting the Middle Kingdom’s plan to turn member states is working. But blocking the levy will be legally tricky, and Brussels’ credibility is at stake. Beijing faces a long road to upend the union’s plans.

Telegram and X expose tech platforms’ new reality

12 Sep 2024

The arrest of Pavel Durov, founder of the controversial messaging app, and the ban of X in Brazil shows state officials are not afraid to intervene in Big Tech. In this Viewsroom podcast, Breakingviews columnists debate what it means and how CEOs should manage the threat.

Ireland can use unwanted taxes to keep Apple sweet

10 Sep 2024

Europe’s top court told the iPhone maker to pay $14 bln in corporate levies. Dublin opposed the move for fear of driving away Big Tech. But PM Simon Harris can up the country’s allure by spending the funds on infrastructure, and IT giants have limited choices for EU headquarters.

China brokerage deal has more bark than bite

9 Sep 2024

The merger of Guotai Junan and embattled rival Haitong will create the country’s largest brokerage with assets of $225 bln. The overcrowded sector needs consolidation, but this deal probably won’t aid Beijing’s goal to foster a squad of world-beating investment banks.

Telegram’s route to profitability looks dubious

3 Sep 2024

The troubled app’s CEO Pavel Durov runs a lossmaking enterprise. The easiest path to profitability is to echo Facebook, but content moderation costs would further hit Telegram’s finances. The main alternative is to be a messaging app, but WhatsApp implies that’s hard to monetise.

Telegram CEO arrest is fuzzy warning to Big Tech

28 Aug 2024

Paris prosecutors detained Pavel Durov as part of a probe into illicit activity on the app. The specifics of the case and French law have little read across for rivals like Mark Zuckerberg or Elon Musk. Yet a global scandal will heap pressure on platforms to clean up content.

New EU antitrust tsar has better tools, harder job

27 Aug 2024

The European Union will soon have a new competition commissioner. Margrethe Vestager’s replacement has greater scope to go after Big Tech and Chinese subsidies. But he or she will also have to defend the single market from the assault of EU members’ national industrial policies.

Elon Musk’s best move in EU fight may be an eXit

21 Aug 2024

The billionaire has different views on content moderation from the European Commission, which is investigating his social-media site. It’s hard to imagine a compromise. Rather than risking fines of 6% of sales, it might be easier for X to simply block users in the region.

Price may be Couche-Tard’s lowest Seven & i hurdle

21 Aug 2024

The Canadian suitor may be able to cut enough costs to offer a 40% premium for its rival, valuing it at $59 bln. But antitrust concerns might require selling some US assets. And the target's status in Japan as a quasi-national asset will complicate attempts to seal a deal.

Luxury’s legal pain is new threat to valuations

20 Aug 2024

Italian prosecutors allege sweatshop-like worker conditions at subcontractors of houses like LVMH’s Dior. That’s a bad look after recent luxury price rises. But if the sector has to hike costs to improve its supply chains, investors may find a new reason to mark valuations down.

Google solution is distribution, tech and time

19 Aug 2024

How do you fix a $2 trln illegal search monopoly? Counterintuitively, big moves like separating Google’s ad platform might just treat the symptom. Nixing contracts bolstering its lead in users and data gets at the illness. The key is to give new tech room to shift the market.

Court-emboldened capital puts labor on front lines

9 Aug 2024

Starbucks and SpaceX are among the employers testing the scope of a recent US Supreme Court decision against SEC tribunals. If it extends to a labor law agency, it would be a setback for reinvigorated unions and give companies proof of concept to undo rulings elsewhere.