Asia-Pacific

Beijing’s closer embrace is bad news for Big Tech

12 October 2017

China wants stakes and board seats at web giants like Tencent, the WSJ says. Beijing is already influential behind the scenes in technology, and given its tightening grip elsewhere, a power grab in this vital sector was all but inevitable. This will nonetheless cost investors.

UBS no longer lonely in Hong Kong’s IPO sin bin

12 October 2017

The securities watchdog says it is probing shoddy work by 15 firms on Hong Kong listings. That takes some heat off UBS, the only active IPO bank named so far. A lot has changed in recent years, but the regulator’s zeal in cleaning up the market is nonetheless welcome.

Hadas: Economists need more psychological abuse

11 October 2017

Insights from the study of the mind helped Richard Thaler win the Nobel Prize in economics. The dismal science would benefit from more thoughtful analysis. Rules of thumb could help with investments, statistics would become less alien, while ethics could illuminate big decisions.

Hong Kong’s new leader clears first hurdle

11 October 2017

In her maiden policy address, Carrie Lam unveiled lower taxes for small firms and more affordable housing for the middle class. Her proposals mark a decent start for tackling the city’s economic divide. If she follows through, Lam could earn support tackling more divisive issues.

Syngenta puts Beijing’s unspoken promises to test

10 October 2017

The Swiss seed company’s Chinese parent and its state backers disagree over whether they stand behind its legal bills. It’s a dynamic found across China’s financial system: implicit guarantees are common, and rarely tested. The government has good reason to keep things ambiguous.

Companies WACC central bankers on yields

10 October 2017

Rate-setters have engineered ultra-low borrowing costs and the risk premium on stocks is down. In theory, that lowers the bar for business investments. In practice, corporate hurdle rates have barely budged for decades. It’s a reality check for policymakers trying to fan growth.

IKEA digital surrender raises flicker of IPO hope

10 October 2017

The Swedish furniture firm has grown through its warren-like stores and without needing external capital. Yet it now plans to sell through websites like Amazon to reach new customers. With competitive pressures growing, IKEA might also revisit its aversion to selling stock.

Money-go-round is neat way to fix Indian banks

10 October 2017

New Delhi might issue "recapitalisation bonds" to stressed lenders and use the proceeds to bail them out, as it did in the 1990s. This makes sense: banks are flush with cash after Premier Narendra Modi banned big banknotes. It might also help to contain the fiscal deficit.

Breakdown: Xi and China’s leadership reshuffle

10 October 2017

President Xi Jinping may be China's strongest leader in decades, but reform has been slow on his watch. Some believe that if he can consolidate power at the Party Congress next week, he'll liberalise further. Four key benchmarks will help measure the strengthening of Xi's grip.

Nobel Prize nudges economics to accept the obvious

9 October 2017

Richard Thaler won the award for showing how people don’t always behave rationally to maximise a narrow concept of well-being. His insights forced economics to confront its shaky tenets. They are less useful for building new theories of how economies and markets actually work.

HSBC’s next challenge is how to grow responsibly

9 October 2017

The global bank wants insider John Flint to replace CEO Stuart Gulliver, according to the Sunday Times. If approved, he will take over a slimmed-down lender trading at 1.2 times book value. Investors now want growth – but Flint and Chairman Mark Tucker should heed past mistakes.

Mantra should have reservations over Accor bid

9 October 2017

Accor has offered $917 mln for the Australian hotel group. The French suitor’s bid looks cheap set against previous deals in the sector, and given the financial benefits Accor could reap. Mantra’s board could afford to ask for a bit more before handing over the keys.

China’s oil giants brace for electric car crash

9 October 2017

Beijing's move against gasoline means tough times ahead for the country's oil majors. The rapid push into new energy vehicles will curb demand for imported hydrocarbons, but at the expense of state giants like Sinopec and PetroChina. It might also pressure crude prices.

Wanderlust, not shopping, drives China tourism 2.0

9 October 2017

More people spent China's "Golden Week" holiday on Thai beaches than in Hong Kong malls. As Chinese tourists eschew shopping for sight-seeing, offshore luxury retailers could lose custom. But as the travelling middle class spreads out, there are bound to be more winners.

Review: Dani Rodrik gives economists a better name

6 October 2017

The mildly iconoclastic Harvard professor’s “Straight Talk on Trade” runs through several controversial claims, from praise of diversity in economic models to support for curbs on capital flows and unfair trade. His humility is admirable, even if his pessimism may be overdone.

Sliding peso flashes warning sign over Philippines

6 October 2017

The peso’s slide to 11-year lows reflects concerns about President Rodrigo Duterte’s priorities. His brutal drug war, erratic leadership and vague economic plans could send Asia’s worst-performing currency even lower as Manila’s balance sheet deteriorates and inflation rises.

Buyout giants break through the ice in Japan

6 October 2017

Western private equity firms are no longer getting a frosty reception in Tokyo. Bain’s $18 bln deal for Toshiba’s chip unit is a special case, but rival KKR has notched up big deals with Nissan, Hitachi and Panasonic. Patience helps. So does a sense of crisis among sellers.

Viewsroom: Building the car for the future

5 October 2017

Ford boss Jim Hackett’s plan to catch up with rival GM on electric and self-driving vehicles starts with $14 bln of cost cuts. China may be in pole position as it considers banning gasoline cars entirely. But plenty of factors could delay mass adoption of new technology.

More for China than London in Russian hydro IPO

5 October 2017

Oleg Deripaska’s En+, which controls aluminium outfit Rusal, aims to raise $1.5 bln in an LSE and Moscow listing. It touts a green model, but public investors will have little say. The cornerstone backer, a partner of the PRC group that just bought into Rosneft, may do better.

Hadas: Road to calm finance is unsafe at any speed

4 October 2017

A decade after the last financial crisis began, central banks are finally moving to normalise interest rates and money supply. With governments weak and banks and businesses hooked on easy credit, risks are high. There’s a better way to run this system, but few seem interested.