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Thursday, 18 December 2014


China's superlative growth looks hard to sustain

18 December 2014

Assume the economy expands as briskly in the next 20 years as in the past decade. Its share of world GDP could top 35 percent, a Breakingviews calculator shows. A static workforce would have achieved heroic productivity gains. If it doesn’t, China’s slowdown has only just begun.   

avon products

Avon exposes ugly side of doing business in China

18 December 2014

The U.S. cosmetics company’s Chinese subsidiary gave officials handbags, holidays and cash to access a huge market. The rationale: muddy markets make dirty hands. Avon has learned its lesson with a $135 mln fine. Elsewhere in China, the belief that bribery pays remains engrained.   

Dollar signs are seen alongside the signs for other currencies at a currency exchange shop in Hong Kong November 1, 2014.

The too-big-to-fail club will shrink in 2015

17 December 2014

The list of global banks deemed systemically important has hardly changed since 2011. But membership now comes with ever-larger capital requirements and increased regulatory meddling. In an attempt to escape, some lenders will decide to become smaller or less interconnected.

Employees work inside a travel agency office besides a model of a SpiceJet aircraft in the western Indian city of Ahmedabad February 14, 2014.

SpiceJet rescue is no fix for India aviation woes

17 December 2014

The government is cajoling banks to lend to the indebted airline, which really needs more equity. The lifeline just might prevent a repeat of Kingfisher’s high-profile failure. But high fuel taxes and the lack of a bankruptcy law will keep the industry stuck in an air pocket.

A phone running the Uber application is held above the traffic in central Bangkok December 10, 2014.

Baidu's Uber stake is more hype than substance

17 December 2014

The Chinese web giant is already behind rivals Alibaba and Tencent in mobile taxi-apps. Strategically the tie-up looks like a coup. But without financial terms, investors are left in the dark. Uber’s controversial track record and Baidu’s shrinking margins add to the uncertainty.

The Chinese flag flies with the Pudong skyline in the background

Chinese companies will mostly stay at home in 2015

17 December 2014

Even with a slowing economy the People’s Republic offers lots of growth for home-grown corporations. Hostile regulators, stronger rivals, and cultural differences discourage foreign expansion. Though some will take the plunge anyway, in most cases overseas growth can wait.

A woman walks past a Li Ning sportswear store in Huaibei, Anhui province October 17, 2012

TPG should let investors off the Li Ning treadmill

17 December 2014

The U.S. buyout firm is backing a $219 million capital raising by the Chinese sports brand it has failed to revive in almost three years. The cash will help. But if TPG really wanted to show confidence, it would team up with the company’s founder and take Li Ning private.