China

Guest view: China bonds enjoy best of worst times

23 January 2020

Defaults are at record highs, yet foreign money keeps chasing yield in the country’s fixed-income market. China finance specialist and author Fraser Howie argues Beijing can console itself: its bonds are part of the global investment landscape as never before.

Flying cars are a cool solution to a tiny problem

23 January 2020

Toyota has pledged $394 mln to support aviation startup Joby; Geely and Hyundai are also dabbling. Technology advances have put commercialisation within reach, and regulators will slowly come to grips with the idea. The final frontier is finding actual customers.

China virus scare leaves bling giants exposed

21 January 2020

A deadly virus erupted ahead of the key Lunar New Year festival. Compared to the 2003 SARS crisis, the damage to luxury stocks looks modest. Yet Chinese shoppers now make up a third of the $310 bln market for high-end goods. If the disease spreads, the overall hit will be worse.

China’s viral immune system open to economic pox

21 January 2020

A bungled swine flu cover-up doubled pork prices last year, taxing the poor. Now a human virus is panicking citizens before the start of what’s usually a $150 bln holiday spending boom. President Xi’s anti-corruption campaign has made officials less venal, not more credible.

Moody’s Hong Kong downgrade flunks Carrie Lam

21 January 2020

The credit agency cut the city’s rating, citing the leader’s feeble response to months of unrest. It’s a terse rejection of her stimulus plan, but Moody’s also indicted wider institutional inertia. That suggests economic revival will be difficult, whether Lam stays or not.

Macau’s makeover comes at a cost for casinos

20 January 2020

Authorities are desperate to diversify the $55 bln economy beyond betting and will use their clout in 2020 to force Sands and Wynn to invest more in theatres and malls, away from betting tables. Odds on it will sink profit margins: the new breed of visitors won’t be big spenders.

Huawei can afford to hang up on America

17 January 2020

The Chinese telecoms firm is fighting to keep its rural-carrier customers amid D.C. pressure. It’s a losing battle and makes little sense given the tiny contribution to Huawei’s top line. Quitting the U.S. would get rid of a headache and leave more energy for bigger conflicts.

China’s shadow bankers sneak back to market

17 January 2020

GDP grew 6.0% last quarter, but lending disappointed. A drive to cut bad debt while pushing banks to prop up small risky firms has squeezed healthier private companies. With informal, pricey credit moving to fill the gap, officials may have to tolerate a shadow loan revival.

Anta Sports puts ultimate buy rating on itself

17 January 2020

After outrunning short-sellers, the Chinese apparel giant is issuing 1 bln euros of convertible debt that pays nothing and can’t be swapped for equity until shares rise 40%. Strong take-up will signal confidence Anta can repeat its success reviving Fila with Finland’s Amer.

Trump’s trade war chases its own tail

16 January 2020

The U.S. president is hailing his agreement with China as a boost to farmers and manufacturing workers. It is, but only because they were the losers from trade conflict. Obama showed that following the rules doesn’t work; Trump has only shown that ripping them up doesn’t either.

Viewsroom: Carlos Ghosn’s great escape

16 January 2020

The international car boss who fled Japanese authorities is now lambasting Nissan and suing Renault for money due. Breakingviews columnists discuss why the latest twists overshadow the fraying global alliance of three automakers. Also, why China’s Geely wants Aston Martin.

China’s reform camp high-fives Wall Street

16 January 2020

The most substantive part of Beijing’s trade deal is the commitment to open its financial sector. Combined with other liberalisations, local institutions face real U.S. competition. That should reduce the credit misallocation that irks trade partners and warps economic growth.

Lazy days are over for buyout barons in China

16 January 2020

Dealmakers were gloomy at an annual forum in Hong Kong after a disappointing year. Private equity can no longer rely on minority stakes in a booming economy to juice returns. Tech bets are mostly off. The next batch of funds will work hard on traditional, unloved businesses.

China trade deal gives Trump a campaign win

15 January 2020

Beijing pledged to buy more U.S. goods and enforce intellectual-property rights. It has fallen short on similar promises in the past, and anyway the conflict was partly whipped up by the U.S. president. Still, he can tout the new “phase one” agreement as he seeks re-election.

Hong Kong’s luxury icon sells new retail model

15 January 2020

Chow Tai Fook plans to close up to 15 of its local stores. The $11 bln jeweller’s decision comes at a moment of calm after months of protests and before a key shopping holiday. That suggests a recovery is distant. Tapping mainland shoppers elsewhere is the new way forward.

Plane woes cast doubt on Beijing’s DIY tech plan

14 January 2020

The C919, intended to compete with Airbus and Boeing commercial jets, is behind schedule and riddled with problems despite vast state support. China’s plan to replace foreign hardware and software with local versions may struggle to take off for similar reasons.

Trump adds fake currency news to trade armory

13 January 2020

The U.S. government will stop accusing Beijing of yuan manipulation as part of a limited tariff deal. The dubious claim was born of presidential ire. But its arguable success makes it a useful stick for the White House – a worry for those with growing trade deficits like Vietnam.

Geely’s European car collection is too eccentric

13 January 2020

The Chinese rescuer of Lotus and London black cabs might inject funds into Aston Martin, James Bond’s favoured ride. Founder Li Shufu had some success with Volvo, but with his home market under pressure, becoming a collector of genteel money-losers is an unwelcome distraction.

Taiwan’s revival is Tsai’s to squander

13 January 2020

The independence-leaning president has coasted into a second term on anti-Beijing sentiment and a strong $580 bln economy. Tsai Ing-wen can take credit for neither. After wasting an earlier opportunity, she now has another to fix poor infrastructure that threatens growth.

Hong Kong bourse boss trusts in awkward necessity

10 January 2020

Charles Li has seen HKEX earnings plunge on political unrest as Beijing mulls alternative venues. Yet Li is confident China’s market inefficiencies will leave it dependent on Hong Kong’s financial plumbing in the end. The exchange’s reviving share price suggests investors agree.