Macau Business Daily, April 29, 2013 by Business Daily

Second-hand homes for the middle-class

www.macaubusinessdaily.com

Year II

Number 271 Monday April 29, 2013

Editor-in-chief Tiago Azevedo

Deputy editor-in-chief Vitor Quintã

MOP 6.00

April 19, 2013

More public housing will help reduce the price of second-hand homes, boosting the middle class, said Tommy Lau Veng Seng. In an interview with Business Daily the president of the Macau Association of Building Contractors and Developers said more supply is needed to turn residents into homeowners. Rents will keep growing as more people come to work at Cotai’s resorts, the legislator warned. Pages 6 & 7

Alert level up as avian ’flu closes in S

tarting this morning there will be thermal infrared detectors in all of Macau’s border crossings and not just at the airport. The move comes as the first case of H7N9 bird ‘flu was detected in Fujian province. Meanwhile a chicken was found to be infected with a virus of the H7 strain in a poultry wholesale market in Dongguan, in neighbouring Guangdong province, yesterday.

Chinese Premier Li Keqiang called on health officials and residents to remain vigilant against the bird ‘flu, as the number of infections rose over the weekend. The city is expecting a larger flow of mainland tourists starting today as China enters the three-day May 1 vacation. The tourism and hospitality industry does not expect the ‘flu outbreak to have a major impact on business. More on page 5

I SSN 2226-8294

Report does little to clear Sin Fong doubts

Assembly members in no hurry over old districts bill Page 2

Page 2

Wynn results improve despite VIP slowdown

Hang Seng Index Page 8

22680

22652

Staff shortage foils longer Gongbei hours

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22596

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he Gongbei border crossing will not be open for two extra hours during the May 1 holidays, unlike during the Ching Ming festival holidays. The extension will not be implemented due to a lack of staff by the Zhuhai customs, the government said. But the Lotus Bridge border will open for two extra hours permanently still this year, said a Hengqin official.

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April 26

HSI - Movers

Page 3 Name

Residents’ wages hit record high

he pay gap between the city’s haves and have-nots expanded in the first quarter as residents’ salaries reached new highs, while the wages of non-resident workers were unchanged. The gaming industry and hotels were the biggest creators of new jobs in the first quarter, hiring a further 700 people. About 1,500 of the 1,800 new jobs created were filled by imported workers.

Page 4

%Day

TINGYI CAYMAN

3.16

WANT WANT CHINA

3.00

CHINA UNICOM HON

2.59

BELLE INTERNATIO

2.37

PETROCHINA CO-H

1.96

NEW WORLD DEV

-1.02

CHINA COAL ENE-H

-1.56

COSCO PAC LTD

-1.69

HONG KONG EXCHNG

-1.89

SINO LAND CO

-2.56

Source: Bloomberg

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April 29, 2013

Macau

No one yet to blame for Sin Fong Garden: govt Neither developer nor residents are pleased with report over the collapse-threatened building Stephanie Lai

sw.lai@macaubusinessdaily.com

A support pillar at Patane’s Sin Fong Garden collapsed in October (Photo: Manuel Cardoso)

oncrete of poor quality was found in four support pillars of the car park at collapsethreatened residential building Sin Fong Garden, a governmentcommissioned report says. All of the 140 households from the 18-year-old high-rise building located in Patane had to be evacuated on October 10 after one of its support pillars in the car park collapsed, threatening the building structure. After almost half a year the government released a report on the building’s structural flaws on Friday, without giving any reason for the delay. A University of Hong Kong civil engineering consultancy team carried out the study. It also concluded that the piling works at the adjacent construction site, Soho Residence, or the demolition of a neighbouring industrial building did not affect Sin Fong Garden’s support pillars. “We will conduct an [administrative] investigation on the developer and the engineer overseeing the construction,” said Jaime Carion, director of the Land,

Public Works and Transport Bureau. “At this moment and until that happens we cannot say who is the responsible party,” he told media during the report presentation on Friday. But the building’s main developer does not agree with the conclusions. “If they are saying the neighbouring constructions had no impact, how come the residents of [nearby] buildings Lei Cheong and Kwong Heng complain of a tilting problem, similar to what Sin Fong has encountered?” said Lino Ho Weng Cheong, managing director of Ho Chun Kei Construction and Investment Co Ltd. Mr Ho told Business Daily its engineering and legal team would first study the report before making any further comments. “Nevertheless, we will attend a hearing to be held by the government on the Sin Fong Garden incident. The instructing engineer [in charge of overseeing foundation works] will also attend,” he added. The government has not set a date for the hearing. The owners of Sin Fong Garden flats are also unhappy with the conclusions, Chinese-language media reported. “People ask us how much we would like to get as compensation, and whether we are willing to pay for the reconstruction of Sin Fong Garden,” said owner Wong Kok Fai during public broadcaster TDM’s Macau Forum, yesterday. “But we are not able to answer those questions because we don’t know who is the right party that we can talk to,” Mr Wong said. “I hope the government could find out who is the one responsible for the incident, and not shying away from the problem anymore.”

Assembly kills time on old districts bill Legislative Assembly and the government appear divided over the bill, while the window to pass it is closing Tony Lai

tony.lai@macaubusinessdaily.com

egislative Assembly members think rushing to pass the bill on the regeneration of old neighbourhoods bill is pointless without a clear definition of what an old neighbourhood is. But there is no sign that the government is willing to scrap the bill. The chairman of the assembly’s second standing committee, Chan Chak Mo, said on Friday that the committee would resume debate on the bill early next month and demand an opinion from the government. The bill passed its first reading in March 2011 but Mr Chan’s committee has done no work on it since last year. “We think it would be better to discuss this bill in the new assembly after other laws come into force,” Mr Chan said on the sidelines of a committee meeting. Members wish first to pass the bill amending to the land law, the urban planning bill and a cultural heritage protection bill, before the assembly is dissolved in the summer for elections. Bills pending lapse when the assembly is dissolved and the legislative process must begin

again when the new assembly convenes in October. “[We] are talking about old neighbourhoods but we do not know what they are,” Mr Chan said. “There is no definition of old neighbourhoods.” He said the omission was due to the lack of an urban planning law dividing the city into zones. His committee is also handling the urban planning bill.

Mr Chan said the assembly would have to wait for the government to draw up an urban master plan and detailed urban plans even after the urban planning bill was enacted. “As such, is it really worth it to pass the old neighbourhoods bill now?” he said. The master plan would contain the strategy for development and the detailed plans would direct development locally.

Any regeneration of the Iao Hon district will have to wait for legislation (Photo: Manuel Cardoso)

Assembly president Lau Cheok Va said in February that the assembly would ask the government to withdraw the old neighbourhoods bill. Secretary for Public Administration and Justice Florinda Chan said the government would cooperate with the assembly, but did say if it would withdraw the bill. Mr Chan said it was “not necessary to reach a consensus with the government” on how to handle the matter. He said that if the government did not withdraw the bill, the committee could still draft its report and let the full assembly decide its fate. The committee met government officials behind closed doors on Friday to discuss the urban planning bill. Mr Chan said the government’s legal advisers and assembly members were divided over provisions in the bill about voiding the master plan and detailed plans. The committee was concerned that the bill’s provisions, namely those on compensating property owners whose interests are harmed by changes to urban planning schemes, may be inconsistent with other related laws.

April 29, 2013

Macau

No Gongbei opening extension for May 1 But Hengqin crossing could be open for longer hours by the end of 2013 Vítor Quintã

vitorquinta@macaubusinessdaily.com

he Gongbei border crossing will not be open for two extra hours during the May 1 holidays, the government confirmed on Saturday. The extension will not be implemented due to a lack of staff by the Zhuhai customs, the Government Spokesperson Office said in a statement. Business Daily had reported on

April 19 that the two-hour extension implemented during the Ching Ming festival holidays was unlikely to be repeated for the May 1 holidays. To cope with the Ching Ming extension the Zhuhai customs had “to ask to allocate over 100 extra staff to the Gongbei border from Guangzhou and Shantou customs for provisional support, on rather urgent notice of just one day,” Gongbei customs

Over a million people crossed Gongbei border during Ching Ming holidays (Photo: Manuel Cardoso)

post supervisor Lao Ngai Leong told Business Daily at the time. “We extended some of our customs colleagues’ working hours,” a Zhuhai customs spokesman added. To repeat the practice would be even more difficult with the H7N9 avian flu outbreak spreading (see page 5) and putting greater pressure on the quarantine process and crowd monitoring, Mr Lao added. Gongbei is Macau’s busiest border crossing, having handled almost 13.6 million visitors last year. The government has pledged to “continue to push for the fulfilment of the border crossing opening extension measure, as well as to carry on with the preparation works”. The border to Hengqin Island will open for two extra hours permanently still this year, said Ye Zhen, deputy director of the Administrative Committee of Hengqin New Area, on Saturday. “We predict that before the end of the year the measure will be confirmed for implementation,” he said quoted by public broadcaster TDM News. “When all the participants are well prepared it will be introduced officially,” Mr Ye added. The closing hour of the Lotus Bridge border will extend from 8 pm to 10 pm, both on the Hengqin side and on the Macau side, the official said. The opening hour will remain 9 am for that border. There will be no change as “not many people use” that border due to the ongoing development on the island, the government’s spokesperson, Alexis Tam Chong Weng, said earlier this month. The Lotus Bridge border is mostly used by cargo trucks.

Bally Tech. quarterly net income up 28.5 pct Beats analyst consensus on fiscal third quarter, steps up share repurchase programme Michael Grimes

michael.grimes@macaubusinessdaily.com

ally Technologies Inc. – a major supplier of gaming equipment to the Macau and regional casino markets – beat Wall Street consensus on earnings and revenues in its fiscal third quarter results to March 31. Net income attributable to the Nevada-based company improved to US$38.45 million (307.47 million patacas) or 93 U.S. cents per share from US$29.91 million or 67 U.S. cents per share in the same period last year. Revenues totalled US$259.1 million, up from US$228.6 million last year. The fiscal third quarter number was 5.3 percent higher than analyst consensus of US$245.97 million. Gross margins improved to 65 percent from 63 percent last year, indicating Bally’s strength in the market for high-margin electronic systems used to monitor and manage casino slot floors. Ramesh Srinivasan, Bally’s chief executive, told analysts on the quarterly conference call that around a fifth of the firm’s revenues came

from outside North America. “…overall revenue from international regions was 18 percent this quarter. Growth in international regions remains a good opportunity for us,” stated Mr Srinivasan, who for six years between 2005 and 2011 was head of Bally Systems. “Our significant product investments aimed at these markets during the past couple of years will begin to bear fruit in a steadily increasing way,” he added. The firm also said it was stepping up its share repurchase scheme. It authorised a new US$300 million programme. That replaces the existing US$150 million one whereby Bally had so far repurchased approximately US$63 million of its common stock – including US$31 million-worth in the fiscal third quarter. “Overall, it was yet again another strong quarter for Bally,” said Union Gaming Research in Las Vegas in a note to clients. “This is particularly impressive against the backdrop of a challenging environment for equipment companies (few new

property openings, over-leveraged [U.S.] gaming operators and soft [U.S.] regional revenues). Bally’s systems business provides for revenue visibility in a challenging industry to model given the lumpiness of game shipments,” added Union Gaming.

Ramesh Srinivasan, CEO, Bally Technologies (Photo: Carmo Correia)

editorial

A beggar’s tale

Vítor Quintã

vitorquinta@macaubusinessdaily.com

hief Executive Fernando Chui Sai On again asked the public not to buy homes on Thursday, admitting that “the market is overheated and the prices are too high”. The message has not changed substantially since Mr Chui’s Policy Address for 2013, delivered in November. At the time, he called for people to ensure their incomes were big enough for them to afford a home. Two weeks ago, the most Secretary for Transport and Public Works Lau Si Io had to say was to ask prospective homebuyers to assess their finances before buying a house. Housing prices increased by 6.7 percent in the first three months of this year. Hong Kong and the mainland have introduced further measures to cool their housing markets. It is unclear how effective they have been. In Macau, the best the government can do is to beg people not to exercise their right to buy property. This is ludicrous. The government can advise the public at any moment about what type of behaviour it should be engaging in. Recycling is an example. If at any point the government decides the activities of some people – even if not illegal – are harming the public interest, it can introduce restrictions. Mr Chui is terribly naive if he expects the public, many of whom are proxies for mainland investors, to refrain from buying property on the strength of his remarks. If I were interested in buying property, these comments would boost my interest in closing a deal immediately. A government that resorts to begging for public compliance is one that is either impotent, lacks ideas or is simply unwilling to take the necessary action. If prices are too high, something must be done, regardless of interests in the real estate and construction industries. The public cannot afford to wait until the five new areas of reclaimed land are ready to hold thousands of new flats, contrary to Mr Chui’s suggestion. Renting, the alternative to buying a home, is becoming more expensive. How expensive it really is remains unclear, as the Statistics and Census Service has not published data on housing rent since the 2011 census. Perhaps we will have to wait until the next census in 2021. The government must abandon the myth that Macau is a free and open market, as economist Albano Martins told Business Daily in an interview published last week. Nobody believes it. Telecommunications, transport, fresh food: the market for none of these things is fully open, to the detriment of the city. It seems the government is keen on making sure the market is free and open only when it benefits powerful interests such as real estate developers and builders.

The government is keen on making sure the market is free and open only when it benefits powerful interests

April 29, 2013

Macau State-owned builder wins Hengqin plot

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A subsidiary of state-owned builder China Communications Construction Co. Ltd won a Hengqin land plot in a tender only open to organisations included in Fortune magazine’s top 500 companies worldwide, the Zhuhai authorities announced last week. The mainland’s largest port constructor successfully bid for the 32,000-square-metre plot at the reserve price of over 688 million yuan (860 million patacas). The firm will invest over 3 billion yuan in a financial services project, according to media reports. Macau businessman David Chow Kam Fai won a Hengqin parcel in December to develop a Portuguese-themed commercial centre

HOSPITALITY No cheap thrills The prices of the goods and services tracked by the tourist price index have increased in each quarter since 2008. Compared to consumer price inflation, as measured by the consumer price index, the price rises borne by tourists have been greater and shown more volatility. The rise in tourist prices between the first quarter of 2008 and the first quarter of this year is more than 50 percent. The graph below plots annualised quarterly growth in the tourist price index published by the Statistics and Census Service in conjunction with the quarterly figures for the index and its components.

Residents take home higher salaries in Q1 Median earnings are unchanged as the wages of imported workers level off Tony Lai

tony.lai@macaubusinessdaily.com

A rising trend reversed after the third quarter of 2008. In the following four quarters the annualised rate of quarterly tourist price inflation fell by more than 9 percentage points. Tourist price inflation was at its lowest at 3.1 percent. A second upward trend persisted until the fourth quarter of 2011. This time, tourist price inflation topped about 15.5 percent, five times what it was just two years before. From that peak, tourist price inflation dropped rapidly to about 5.6 percent in the first quarter of this year. Any seasonality of the price changes within the year, which we might expect, is diluted by the longer-term trends illustrated here. J.I.D.

3.1%-15.5%

Range of annualised quarterly tourist price inflation since 2008

Businesses in the recreation and gaming sector took on 700 more workers last month

he pay gap between the city’s haves and have-nots expanded in the first quarter as residents’ salaries reached new highs, while the wages of non-resident workers were unchanged. Residents’ median monthly pay reached 14,500 patacas (US$1,812.50) in the first quarter, an increase of 1,500 patacas or 11.5 percent over the previous quarter, the Statistics and Census Service said on Friday. The pay of residents makes up twothirds of workers’ earnings but, even with the increase in their wages, the city’s median monthly salary was stable at 12,000 patacas, suggesting wages for imported workers were steady. The wages of non-resident workers are not monitored. The median wage has increased by 9.1 percent in the past 12 months,

more than offsetting inflation in the same period of 5.38 percent. Also released on Friday was the unemployment rate in the first quarter, which was unchanged at 1.9 percent. It is the lowest rate since the government started collecting data in 1992 and the third-lowest in the world. The unemployment rate among residents rose by 0.1 percentage point to 2.5 percent. About 1,500 of the 1,800 new jobs created were filled by imported workers. The ranks of the jobless increased by 200 people in first quarter, taking the total to 6,800 people, and the labour force now numbers about 351,800 workers. Chief Executive Fernando Chui Sai On said on Thursday that a shortage of workers would intensify before

2016, when several casino-resorts in Cotai are set to open. He flagged a looming debate about importing more foreign workers, saying the labour force could grow by “absorbing qualified talent from elsewhere”. Official data show the gaming industry and hotels were the biggest creators of new jobs in the first quarter. The biggest employer was recreation and gaming. The industry created 700 jobs in March to take its workforce to about 81,100 people, or about one in four of all workers. About 400 people started working in hotels last month and they now employ about 29,800 workers. The rate of underemployment, which measures the number of people overqualified for their jobs or who want full-time work, crept up by 0.1 point to 0.7 percent in the first quarter.

April 29, 2013

Macau

Border checks widen as avian ‘flu spreads south Health Bureau and tourism sector in full-alert as H7N9 bird ‘flu reaches southern China Stephanie Lai

sw.lai@macaubusinessdaily.com

Mainland China says 122 people were infected with the H7N9 virus

hermal infrared detectors will begin operating this morning in all of Macau’s border crossings, the Health Bureau announced, as the first case of H7N9 bird ‘flu was detected in Fujian province. So far there has been no confirmed case of H7N9 infection in the territory. The bureau said two suspected cases turned out to be negative. Up to yesterday mainland China had registered 122 people infected with the H7N9 virus, 24 of which died. On Wednesday Taiwan also reported the first avian ‘flu infection case. Chinese Premier Li Keqiang called on health officials and residents to remain vigilant against the bird ‘flu, as the number of infections rose over the weekend. “We need to stay on high alert as this is a new virus, and we don’t have all the information,” Mr Li said yesterday during a visit to the mainland’s disease control agency in

Beijing, according to a report posted on China National Radio’s website. Over the weekend Jiangxi, Fujian and Hunan provinces have each reported their first case of the avian ‘flu. Fujian is Macau’s second-largest visitor market in the mainland, accounting for 177,434 tourists in the first quarter. Yesterday a chicken was found to be infected with a virus of the H7 strain in a Dongguan poultry wholesale market, Guangdong province, after a spot-check session. The market was immediately ordered to suspend business and conduct a full-scale sanitisation. Civic and Municipal Affairs Bureau told Business Daily that it is closely checking the Dongguan case at the moment, even though Macau imports no poultry from the city. Authorities are still trying to confirm if the chicken was infected with the H7N9 subtype, in what could be the first such case in

Corporate

Special Olympic Golf Masters ends on a high note The Special Olympics Golf Masters 2013, featuring 14 teams from 12 countries and regions, closed “as a resounding success,” the organisers said as they wrapped up the event that took place at the Caesars Golf Macau. Some 47 athletes and 27 coaches took part in the six-day event, which was divided for Level 5 players and Level 1 and 2 players, the latter tailored for beginner teams from the Asia Pacific Region. Best Performance prize in this specific level of golf went to Team ASEAN, represented by Ranveer and Ahmad from India and Brunei, respectively. The trophy was presented by Macau Government Tourist Office director Maria Helena de Senna Fernandes (left). The Level 5 one-on-one tournament saw Chang Jih Hung from Taipei lift the trophy for Best Performance, presented by Caesars Golf General Manager Li Wei. On Thursday, tournament sponsor Melco Crown Entertainment Ltd invited all the teams to the City of Dreams’ resident show ‘The House of Dancing Water’. On Friday, the Special Olympics teams were welcomed for a gala dinner at the Westin Resort and every athlete and coach was awarded a gold medal.

CORRECTION

Macau donations to earthquake victims In Friday’s edition we published an article titled ‘Sichuan quake money well spent, says govt’, concerning Macau donations to reconstruction works after Sichuan earthquakes (2008 and 2013). In the article, Business Daily wrote the Macau Red Cross spent 719.6 million yuan building 30 medical clinics, 10 county hospitals, 13 schools, 1,207 homes and seven care centres for the elderly in Sichuan and the neighbouring provinces of Shaanxi and Gansu. However, the accurate figure spent by Red Cross was 71.96 million yuan (US$11.7 million). For that inaccuracy we apologise to our readers and to the Macau Red Cross.

neighbouring Guangdong province. The city is expecting a larger flow of mainland tourists starting today as China enters the three-day May 1 vacation. “For sure we will reinforce the cleaning and sanitising work inside hotels,” Chan Chi Kit, president of Macau Hoteliers & Innkeepers Association, told Business Daily. “But we are not intending to set fever screening at hotel lobbies because immigration checkpoints are already doing it,” Mr Chan added. “To add one extra fever sensor at the lobby would make visitors feel too tense.” The authorities have asked the tourism and hotel sectors to remind visitors to keep good personal hygiene, noted Andy Wu Keng Kuong, president of the Macau Travel Industry Council. “But it has not gotten to a point where mainland tour groups are giving the tourists sanitising hand

gel, which was the case at the time of SARS [severe acute respiratory syndrome outbreak in 2002-2003],” Mr Wu told Business Daily. Air Macau told Business Daily that it did not notice any impact from the outbreak on its bookings. But it has affected mainland tour groups, Mr Wu said. “There will be less tour groups travelling to Hong Kong and Macau during the Labour Day vacation,” he predicted. The May 1 holidays is “the weakest golden week in the year,” says Mr Wu, mainly because it is shorter than the Lunar New Year or the National Day holidays. Hotel room rates for the Labour Day vacation will be similar to a regular weekend rate, Mr Wu and Mr Chan said. “Our occupancy has been doing pretty well in the previous weeks,” said Mr Chan. With AFP

April April 29, 19, 2013 2013

Macau Brought to you by

Financial Monitor Growing concern The size of the labour force has increased substantially over the past few years but growth has not been steady. Taking 2008 as the starting date, official data show that the international crisis reduced the number of employed and increased the number of unemployed, albeit to different degrees at different times. The chart below puts the effects the international crisis into perspective. The plots are of indexes for employment and unemployment, based on February 2008, which use the three-month rolling average of the monthly figures for each.

Lau: more homes for middle class needed The construction business is in good health, yet the property market is going through a peculiar phase. The president of the Macau Association of Building Contractors and Developers, Tommy Lau Veng Seng, says the only way to stabilise the real estate market is to increase supply, particularly the supply of homes for the middle class. Mr Lau, who is also a member of the Legislative Assembly, told Business Daily in an interview that the measures recently taken by the government to cool the housing market had only curbed the number of homes sold, and that equilibrium would established only when more homes were added to the market. Luciana Leitão

leitao.luciana@macaubusiness.com

Photo by Manuel Cardoso

Construction work almost stopped in Macau after the financial tsunami and the corruption scandal involving the secretary for transport and public works at the time, Ao Man Long. Are we now resuming the previous pace? All construction sites are operating very actively. I would say we have already restored the momentum of the construction business. It’s very positive, and for the next 10 to 20 years we should have very positive development of the construction business. Employment and unemployment were relatively stable in the first half of 2008. By the middle of the year, unemployment had even fallen, which is somewhat surprising. But as expectations worsened and a new batch of graduates left school, unemployment rose fast in the second half of 2008, reaching high levels and staying there for most of 2009. The number of jobless reached a peak of 12,600 in July 2009. After that the number fell almost without interruption to just below 7,000 people, where it has stayed for the past six months. Employment was slower to react to the international crisis. Until September 2008 the number of people in work kept rising. Then the number fell slowly, reaching its lowest level, 212,000 people, in December 2009. Since then, the number of people in work slowly rose to more than 350,000, where it has stayed for the past four months. J.I.D. The content of this column is the work of Business Daily’s journalists.

9 months The period Macau has had fewer than or about 7,000 unemployed

What will be the next main works? New private projects will focus mostly on the Cotai area, because all those big hotel-casinos are now starting their second phase or third phase of development in the Cotai area. I’ve seen that the Galaxy Macau, all those American gaming companies – Wynn [Macau Ltd], MGM [China Holdings Ltd] – have already started construction work there. The private projects will be concentrated in the Cotai area. However, when it comes to public projects, many have set to start. Some of them are already under construction, like the Light Rapid Transit, in which there are millions invested. If you pass by Areia Preta, you can see the man-made island that will be completed soon for the Hong Kong-ZhuhaiMacau Bridge. After the island is completed you can expect some contracts to be offered to contractors to build car parks for motorists that will use the bridge as a way to travel between Hong Kong and Macau, or even for Chinese tourists coming off the bridge. In addition, there are five pieces of reclaimed land. Area A should start

as soon as possible, considering that it is located between the Macau peninsula and the bridge, so it has to be finished before the bridge is completed in 2016. There will be a lot of contracts arising from the reclamation of those five pieces of land. There are a lot of projects to be started. You and other legislators have pointed out that the government takes too long to approve construction projects. Has the government speeded up the process? Frankly speaking, they have made their best effort to improve the approval process. I think some of the process has been simplified somewhat in the past few months. They have made some improvements. However, they should do more.

Macau does not have enough residential units offered in the market to meet all the needs of residents

Macau does not have enough residential units offered in the market to meet all the needs of residents. Of course, the price of real estate has not fallen, even with the very tough kind of policy imposed by the government last year. We have to try our best. We can work together with the government to speed up the approval process, so we can increase the supply of residential units to stabilise the market or make the potential home buyer more confident and willing to chase high-value property. You could call it an economic or psychological factor that could help residents get the chance to buy a unit somehow in the very near future. The land bill would still allow land grants without public tenders. Do you agree with this? They are going through very detailed discussions of this topic and I will support it if there is a high degree of openness about the information relating to the waiving of the tender, and if all the information is made public. This would allow the government to implement some kind of policy that could help Macau grow and develop. This is one of the key issues, and I will support that. Of course, there may be some kind of further discussion to guarantee that all the information is made public. I think this is quite essential. Is it only through an increase in supply that the government can stabilise home prices? One way to bring down property prices is to increase supply. With regard to the market for rented homes, there will be continuous

April April 29, 19, 2013 2013

Macau upgrade, it will be easy. Usually the most difficult thing for a middle-class family is to buy their first home. Once they have started, if they want to exchange it for another one, they only have to take care of the price difference. On top of that, if they start with a twobedroom unit and if they want to move on to a three-bedroom unit, they only have to pay a little extra. In a few years it should be easy for the middle class to buy a home, provided that the trend of supplying more units to the market continues. How do you feel about the government measures to cool the real estate market? You can conclude from the statistics that it has slowed quite a bit the number of transactions. However, property values are still a little bit high, but this is basically due to the lack of supply. This is the main reason.

There are a few areas that can still offer some kind of land resources, one of them Ilha Verde

demand because in a few years’ time there will be a lot more big projects to be completed. Macau’s population is a bit more than half a million, so I expect quite a number of workers will come from abroad to support the operation of these facilities and projects. Other nationals are coming to Macau to live and work, so they need housing. The market for rented homes is going to move up. How can there be more supply if there is a lack of land? Yes, Macau is too small. What can we do? There are a few areas that can still offer some kind of land resources, one of them Ilha Verde. When the urban plan for that area is approved and announced, there will be quite a lot of parcels available for private developers to build homes on. If the urban plans for Ilha Verde – and also for other areas, on Taipa – are approved, then I think there will be a lot more land available to build property on there. By then there will be a lot more units on offer. But should these units target highincome buyers or the middle class? It’s up to the market. For a businessman, if you are just talking about the private sector, he will look for what is good for his

business. Some developers may aim for units with an area of about 60 to 70 square metres, the optimum size for the average family, and this will be more affordable for the general public or for the middle class. It is good for them if they can market the property and in a matter of a few weeks the units are gone. Then the return will be fast. It depends on market demand, what is most needed. There are quite a few fancy projects already being marketed or under construction in Macau, and they will be put on the market in the next two to three years. Will the market focus on meeting demand for units for the middle class? That is what I’m saying. Developers will focus on that. The government has been focusing on allocating public housing to low-income groups. Should it also target middle-income people? I believe the middle class is the most difficult part of the community when it comes to public housing. That said, our Chief Executive, Fernando Chui Sai On, has already increased the income limit to allow more people to apply for public housing. This is positive. As for the lower-income groups, they have a very good chance of getting public housing. We have many public housing units being offered in the market. We have such a large supply of public housing units offered to the community. In addition to that, there will be property offered by the private sector. A lot more units are going to be on the market in a few years. It is going to bring down demand. By then, the value of some secondhand units will come down, owing to more supply of public housing units and also of private-market property. The middle class may have a chance to buy second-hand property as their first investment. Afterwards, when they want to

amendments to the penal code. It has taken up a lot of time. My background is in the real estate and construction sector, so I will just say that I will be happy to see the three bills related to this sector – the heritage bill, the land bill and the urban planning bill – passed before August. Will that happen? I think every committee is doing its best. Do you expect surprises in the Legislative Assembly elections? At this stage there are so many rumours that I can hardly comment. As I’ve already told you, besides attending meetings at the Legislative Assembly, I have my private business. After the meetings I have to return here and make contacts to speed everything up.

You are also a legislator appointed by the chief executive. Do you expect to be part of the next Legislative Assembly? At this stage I can only think of how I can fulfil my responsibilities during this term. Every day I spend almost four to five hours at the Legislative Assembly attending meetings, so I almost have no spare time to think about that. I’m now on the third standing committee of the Legislative Assembly and there are two bills we’re actively discussing every week: the cultural heritage protection bill, and the

MIN

The middle class may have a chance to buy second-hand property as their first investment

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April April 29, 19, 2013 2013

Macau Wynn Macau and Encore – joined by Wynn Cotai in early 2016

Wynn Macau Q1 net revenue near US$1 bln Adjusted property EBITDA up 14 pct, beating analyst consensus, despite y-o-y fall in VIP chip turnover Michael Grimes

michael.grimes@macaubusinessdaily.com

et revenues at Wynn Macau Ltd rose 4.4 percent yearon-year to US$992.1 million (7.93 billion patacas), despite its VIP chip turnover for the period falling 15.3 percent. Mass-market table gross revenue rose 14 percent yearon-year to US$243 million. Slot machine handle was US$1.1 billion for the first quarter of 2013, a 23.4 percent decline from the equivalent period a year earlier. Win per slot unit per day was 7.1 percent lower year-on-year at US$809, compared to US$871 in the first quarter of 2012. Perhaps most importantly in terms of trend however, Wynn Macau’s adjusted property EBITDA (earnings before interest, taxation, depreciation and amortisation) in the first quarter of 2013 was US$330.7 million, up 14.1 percent from US$289.8 million in the first quarter of 2012. That beat market consensus. The median figure for first quarter adjusted EBITDA based on estimates of five analysts polled by Bloomberg News was US$16 million. Wynn Macau’s Q1 EBITDA It is likely to be one of the strongest EBITDA performances among the Macau operators this reporting season suggested Karen Tang of Deutsche Bank in a report published before Wynn Resorts Ltd declared its global results on Thursday U.S. time. EBITDA is a measurement favoured by analysts as an indicator of how a company is performing relative to its peers and market rivals. Looking at net revenues in isolation is considered less reliable because it can

KEY POINTS Wynn Macau Q1 13 adjusted property EBITDA up 14 pct EBITDA y-o-y growth above analyst consensus Net revenues up 4.4 percent y-o-y to US$992.1 mln Slot handle down 23.4 pct y-o-y Wynn Macau now has multiseat LT Game stadium-style electronic table game: Union Gaming

be affected positively or negatively by the timing of line items such as receipts or expenditures. Wynn Macau’s parent Wynn Resorts said it has approved a cash dividend for the quarter of US$1.00 per common share payable on May 23, to stockholders of record as at May 9. Matt Maddox, chief financial officer of Wynn Resorts, also confirmed to analysts during the first quarter earnings call that US$830 million in dividends for 2012 would be paid by Wynn Macau, with US$600 million of that payable to the parent company “over the next two months”. He added Wynn Resorts had “roughly” US$2 billion

in bank cash, with 75 percent of it held outside the United States – taken to be reference to the strong performance of the Macau operation. “Although Wynn Macau remains largely capacity constrained until it can open its Cotai project in early 2016, the existing asset remains, in our view, the most aspirational in town,” said Union Gaming Research Macau in a note to clients. “To that end the Encore portion of the property continues to experience a surge in high end (a.k.a. premium) mass market play, driving not only high margin high-visibility business but also seemingly driving hold rate higher.”

Win v. hold While Union Gaming uses the term ‘hold rate’ here in a precise way, the issue of ‘win rates’ and ‘hold rates’ in the Macau gaming industry has recently caused some confusion, say a number of analysts. ‘Win rate’ is an indicator of how quickly the casino wins money from the player, but is dependent on play volume. If the casino wins HK$100 from a player betting 100 hands per hour, than that’s an inferior win rate compared to the casino winning HK$100 from the same player betting only 50 hands per hour. “The hold rate on the other hand is a better description of how much the casino has actually won from the players,” says Ben Lee of IGamiX Management and Consulting Ltd, a gaming industry consultancy. “If a player checks in HK$100 at the beginning of the game and walks

away with HK$80, the hold rate for the casino is 20 percent. This is irrespective of how many games were played to achieve that result.” He points out however that hold rates can be skewed when players buy in at the cage, not the table. During Wynn Resorts’ first quarter earnings call Steve Wynn, chairman and founder of Wynn Resorts, raised that issue in relation to his high volume premium mass business at Encore Macau. Mr Wynn said that mass market hold rates in the casino industry had traditionally been measured by what cash goes in the table drop box, compared to what’s paid in table chips to the players. But he pointed out many premium mass players buy in at the cage, not the table. That’s largely because of the volumes of cash involved when playing on tables with minimum bets of HK$2,000 or above. Counting large amounts of cash at the table slows down the game, which neither the players nor the casinos like to see. “…what’s happened is, the customers are buying the chips at the cage, which does not enter into the drop,” Mr Wynn explained to analysts. “So the hold percentage in the mass market and our Diamond Club, our premium mass market, is an irrelevant number. You should disregard that number now and pay only attention to the amount of the win because this absence of the chips purchased at the cage in the handle has skewed the numbers and made it look like we’re holding an abnormal amount of money.”

April April 29, 19, 2013 2013

Greater China EU launches solar glass subsidy inquiry The European Commission launched an investigation on Saturday into industry claims that Chinese makers of solar glass benefit from illegal subsidies, notching up another case against its No. 2 trading partner. The inquiry follows a complaint from trade body EU ProSun Glass, which says Chinese glass sold in the European Union at below-cost prices is damaging the bloc’s solar glass industry. The market, valued at less than 200 million euros (US$260.54 million), is tiny compared with overall EU imports from China, which totalled 293 billion euros in 2011, according to Commission figures, making it China’s main trading partner.

Industrial firms’ profit growth slows

Steel body warns against ‘high expectations’

March net income growth falls to 5.3 percent

Government stepping in to tackle overcapacity

Industries catering to the consumer ‘doing much better’ – analyst

rowth in Chinese industrial companies’ profits slowed in March, adding to evidence the nation’s economic recovery is losing steam. Net income increased 5.3 percent from a year earlier to 464.9 billion yuan (US$75 billion), down from a 17.2 percent pace in the first two months, the National Bureau of Statistics said on its website. Profit in the first quarter rose 12.1 percent to 1.17 trillion yuan (US$190 billion), it said. China’s stocks fell for a third straight month in April amid investor concern that the recovery in the country’s economic expansion is losing momentum and will hurt corporate earnings. The benchmark Shanghai Composite Index closed 1 percent lower on Friday, the last trading day before a three-day holiday ending May 1. “Profits are only growing in line with sales and with problems of overcapacity and the sluggish global picture, it doesn’t bode well for a speedy return to higher profit margins,” said Louis Kuijs, chief China economist at Royal Bank of Scotland Group Plc in Hong Kong. “Heavy industries especially still face destocking and higher costs, but if there is a silver lining, industries catering to the consumer, like textiles, food and beverages, seem to be doing much better.” Industrial companies’ revenue rose 11.9 percent in the first three months to 22.2 trillion yuan, according to Saturday’s statement. That’s down from 13.1 percent in the first two months. The bureau doesn’t break down January and February data due to distortions caused by the timing of

the Lunar New Year holiday. No figure was given for March sales.

Lower estimates Profit margins in the first quarter were 5.3 percent, the same as the first three months of 2012, the data show. The report covers companies with annual sales of 20 million yuan and above in 41 industry categories. Gross domestic product in world’s second-biggest economy expanded 7.7 percent in the first three months of 2013 from a year earlier, down from 7.9 percent in the fourth quarter and trailing the 8 percent median estimate in a Bloomberg News survey. Goldman Sachs Group Inc., Royal Bank of Scotland and JPMorgan Chase & Co. cut their estimates for full-year growth to 7.8 percent after the GDP data were released on April 15. That would be the same pace as 2012 which was the weakest in 13 years. Industrial growth is facing downward pressure amid slowing domestic and international demand, Ministry of Industry and Information Technology spokesman Xiao Chunquan said last week. Profits at industrial companies are at “very low levels” compared with the past few years because of falling product prices and surging costs, Mr Xiao said.

Earnings rebound Vehicle manufacturing earnings dropped 1 percent last month from a year earlier after a 20 percent increase in the first two months, the statistics bureau said in a separate statement. The drop in coal industry profit accelerated in March to 50

percent from 35 percent in the first two months, it said. Earnings in some industries have rebounded after falling for most of last year when slowing economic expansion damped demand for steel, cement and machinery. Restocking and higher product prices are supporting profit gains even as growth in GDP moderates. Profit in the ferrous metals industry, which includes steel, doubled in March from a year earlier, the bureau said. Earnings in oil processing, coking and nuclear fuel processing tripled in March from a year earlier, after swinging to a profit in the first two months from a loss a year ago, the bureau said. China Petroleum & Chemical Corp., Asia’s biggest refiner, made a profit from crude-oil processing in the first quarter for the first time since 2011, while PetroChina Co., cut its refining losses, statements from the companies last week showed. Bloomberg News

US$190 billion

Total profit made by Chinese industrial firms in Q1

hina’s steel industry body warned its members to rein in expectations for the remainder of the year, saying that an anticipated increase in demand would not be enough to justify big rises in production in coming months. Officials with the China Iron and Steel Association (CISA) told reporters at a briefing that the government was looking for new ways to restructure the sector, which was still facing massive problems. China’s steel industry, the world’s biggest, is struggling with poor margins and weak demand even as it heads into the April-June peak consumption season. Sluggish sales in China sent benchmark iron ore prices to their lowest point in more than five weeks on Friday. CISA chairman Zhu Jimin said producers should not be misled by “bright spots”, including improvements in downstream sectors like automobiles, railway construction and shipbuilding. “Downstream demand will gradually improve, but at the same time it is difficult to see any relatively big rises in steel consumption, and the expectations of steel firms should not be too high, and they should not blindly expand output,” he said. The association, which represents around 80 large- and mediumsized steel mills, said in a review of the industry over the first quarter of 2013 that, while overall profits had improved, the market was increasingly precarious. Large steel firms earned 2.5 billion yuan (US$403.24 million) in the first three months after suffering losses in the same period last year. In March, profits fell to 267 million yuan, with margins down to a razor-thin 0.28 percent. According to industry estimates, total annual crude steel production capacity in China is approaching 1 billion tonnes, with mills still expanding even though apparent demand is predicted to reach just 698 million tonnes this year. “We can put it like this – current steel capacity can already completely satisfy peak domestic steel consumption and we should stop all blindly expanding projects,” said Li Xinchuang, CISA’s deputy secretary general. Mr Li said the government was examining ways of tackling the industry’s overcapacity problems, and tougher environmental measures and technological requirements could be used to try to ensure smaller firms face the same social responsibilities as their big state-owned counterparts. Reuters

10 10

April April 29, 19, 2013 2013

Greater China Officials met amid island row Defence officials from Japan and China met yesterday in Beijing, signalling Asia’s two biggest economies are trying to soothe rising tensions over East China Sea islands claimed by both. The two sides discussed ways to improve contacts over territorial issues and exchange opinions on “the maritime communication mechanism,” Itsunori Onodera, Japan’s Defence Ministe, said. Japanese Prime Minister Shinzo Abe vowed last week to protect the islands by force if necessary as marine patrols from both sides circled each other.

ZTE returns to profit ZTE Corp., China’s second-biggest maker of mobile-phone equipment, returned to profit in the first three months of this year because of an asset sale, after posting two straight quarterly losses. Net income rose 36 percent to 205 million yuan (US$33 million) from 150.9 million yuan a year earlier, the company said in a statement to the Shenzhen stock exchange yesterday. ZTE reported a loss of 2.84 billion yuan for 2012 that was triggered by delays in contracts and international projects in the third and fourth quarters.

Cnooc sales climb 13 pct Cnooc Ltd, China’s biggest offshore energy explorer, posted a 13 percent gain in first-quarter sales as higher output helped counter a slump in the price of oil. Oil and gas sales rose to 55.3 billion yuan (US$8.97 billion) in the three months ended March 31, the Beijing-based company said in a statement yesterday. Output rose 17 percent from a year earlier to 93.6 million barrels of oil equivalent. Cnooc, which gets most of its income from oil and gas production, didn’t report firstquarter profit.

ICBC leads state banks to record quarterly profit As banks boost lending and fee-based services

hina’s four largest banks, among the world’s 10 biggest by market value, defied a sluggish economy to report record quarterly profits in the first three months. Combined net income at Industrial & Commercial Bank of China Ltd, the world’s most profitable lender, and its three closest domestic rivals rose 11 percent to 215 billion yuan (US$35 billion), according to their earnings statements. Earnings exceeded analysts’ estimates at all four Beijing-based banks. The biggest lenders are taking advantage of their nationwide branch networks and customer base and maintaining pricing power for loans, even as the economy slowed below 8 percent for the longest streak in at least 20 years. Profit may grow by less than 10 percent this year for the first time since the lenders sold shares to the public in the last decade as China deregulates interest rates and defaults rise, according to analysts’ forecasts. “As long as loan growth remains at robust but not too aggressive levels, the banks will have further earnings upgrades,” said Sandy Mehta, chief executive of Value Investment Principals Ltd, which doesn’t hold shares of mainland banks. “Investor sentiment on the Chinese banks is overly cautious.” Shares of nine Hong Konglisted Chinese banks have gained an average 0.2 percent this year, outperforming a 0.5 percent decline in the benchmark Hang Seng Index.

Lending growth China’s banks advanced 2.76 trillion yuan of new loans in the first three months, 12 percent more than a year earlier, the second highest level

ICBC saw its net profit grow to 68.7 billion yuan

on record, government data show. ICBC extended 461 billion yuan of new loans in the first quarter, 25 percent more than the same period a year ago. ICBC, the world’s largest lender by market value, on Friday reported a 12 percent increase in first-quarter earnings to 68.7 billion yuan, while China Construction Bank Corp, the second- largest, posted a 16 percent increase. Net income rose a betterthan-expected 8.2 percent at both Agricultural Bank of China Ltd and Bank of China Ltd. “Chinese banks this year will need to rely on expanding the scale of lending to bolster income growth as there are pressures on loan profitability,” said Wilson Li, a Shenzhen-based analyst at Guotai

Junan Securities Co. “Chinese banks are in an economic cycle where bad loans are climbing. As long as the increase is slow and gradual, that shouldn’t be a concern.” ICBC’s non-performing loans rose to 80.2 billion yuan as of March 31 from 74.6 billion yuan at the beginning of the year as smaller borrowers struggled for repayment. Bad loans also rose at Construction Bank and Bank of China Ltd, according to their statements. At Agricultural Bank, the balance decreased by 165 million yuan in the first quarter to 85.7 billion yuan, or 1.27 percent of total advances, according to the statement. All four are majorityowned by the government. Reuters

Striking HK port workers cut wage demands Open to discuss increase in the ‘double digits’ Michelle Yun

Ping An posts rise in Q1 net income Ping An Insurance Group Co of China Ltd, the world’s No. 2 insurer by market value, posted a 21.9 percent rise in its first-quarter net profit helped by a steady gain in its insurance and banking business. Ping An generated 7.39 billion yuan (US$1.20 billion) of net profit in the first three months of the year, compared with 6.06 billion yuan a year earlier, it said in a stock exchange filing. Ping An’s Hong Kongtraded shares closed up 0.9 percent at HK$60.2 on Friday before the results were published.

rotesting workers at Hong Kong billionaire Li Ka Shing’s port operator are willing to lower their wage demands as the strike enters its 31st day, according to the Hong Kong Confederation of Trade Unions. About 450 dock workers, mostly crane operators and stevedores, walked out on March 28, demanding higher wages and better working conditions. They had called for a 23 percent pay increase, while labour contractors offered 7 percent. The workers are open to discussing an increase in the “double digits,” Lee Cheuk-yan, the general secretary of the trade union and a lawmaker, said by phone. “I hope talks can take

place very soon but the missing link now is the negotiating party for the crane operators,” he said. Dock workers surrounded Mr Li’s 70-story building in the city’s Central district last week after rejecting a pay raise as inadequate amid rising living costs and record home prices. Hong Kong is the world’s thirdlargest container port, lagging behind Shanghai and Singapore. “We are actually shuttling among various parties with the objective of reconvening the fourth round of negotiating meeting,” Matthew Cheung, Hong Kong’s labour secretary, said on Saturday, according to a government transcript. Mr Li’s Hutchison Whampoa

Ltd failed to persuade a Hong Kong court to order the protesting workers to leave his building, according to a company press release. The Union of Hong Kong Dockers said 3,000 people took part in a rally Saturday night to the Government House, the official residence of the city’s chief executive, while the police said 600 people participated, Radio Television Hong Kong reported. The striking workers earn HK$55 an hour, according to the union. That’s less than the HK$60.70 they were paid in 1995, the union said. The workers took a pay cut in 2003 during the severe acute respiratory syndrome, or SARS, outbreak. Bloomberg News

11 11

April 19, 29, 2013 2013 April

Asia Finance officials to skip talks An annual meeting of finance officials from China, Japan and South Korea will not take place this year, Japanese officials said, amid tension over Japanese lawmakers’ visits to a shrine for war dead and rival claims over small islands. Three-way meetings of finance ministers and central bank governors have been held in recent years on the sidelines of the Asian Development Bank’s annual meeting in May. But China, which serves as chair this year, has informed Japan no meetings need to be held this time as there were no urgent issues to discuss, the government officials said. Homage paid by Japanese politicians at the shrine, which honours 14 leaders convicted as war criminals by an Allied tribunal along with Japan’s war dead, angered China and South Korea, where resentment of Japan’s war-time aggression runs deep. Japan is also locked in a bitter territorial dispute with China over a group of East China Sea islands, called the Senkaku in Japan and the Diaoyu in China.

ANA takes 787 back into the air Expects to pave the way for full resumption of flights three months after grounding

ANA has the largest fleet of Dreamliners

ll Nippon Airways Co Ltd, the Japanese launch customer for Boeing Co’s 787, flew its first Dreamliner in more than three months yesterday to test reinforced batteries installed by the U.S. aircraft maker.

Italian judge rejects Nomura asset seizure An Italian judge rejected a request by prosecutors to seize as much as 1.95 billion euros (US$2.5 billion) of assets held by Nomura Holdings Inc. as they probe how Banca Monte dei Paschi di Siena SpA used derivatives to conceal losses. The judge in Siena took the decision late on Friday, prosecutor Nicola Marini told reporters at a court in the city. Mr Marini said he didn’t have details of the reasoning behind the ruling. Italian prosecutors are probing claims that Nomura executives colluded with Monte Paschi’s former managers to design one of two derivatives in 2008 and 2009 that hid as much as 557 million euros of losses at the Italian bank. Tokyo-based Nomura, which isn’t under investigation, said last week that it will “vigorously” contest any suggestion of wrongdoing. Most of the assets sought from the Japanese broker consist of assets pledged by Monte Paschi to Nomura as security for the derivatives contracts and deposited in Germany. Nomura dropped 0.7 percent to 762 yen in Tokyo, falling for the first day in three.

Philippines mulls adjusting SDA The Philippine central bank is considering adjusting so-called special deposit accounts (SDA) in an effort to manage costs so it has room to cool currency gains. “We would like to consider ways to make the SDA function more as a monetary instrument rather than an investment vehicle,” Governor Amando Tetangco said in an e-mail reply to questions. “The exact form of these refinements will be made known in time but as in our practice, any adjustments we will make will be gradual and phased in.” The possible change in the SDA, which holds about US$46 billion, comes after Bangko Sentral ng Pilipinas on Thursday cut the rate it pays on the deposit facility for a third time this year. The central bank has lowered borrowing costs, banned foreign funds from the special accounts and revised rules to spur outflows. The peso has gained almost 3 percent in the past 12 months, the best performance in the region after the Thai baht, as Southeast Asia’s fastestgrowing economy in 2012 lures investors seeking higher returns than in developed markets, where interest rates are near zero.

The ANA flight was the second by an airline since aviation regulators on Friday gave permission for 787 operations to restart after batteries on two of them overheated in mid January. One was on an ANA plane in Japan

Australia to toughen worker visa laws Government aims to remove loopholes

ustralia plans to toughen laws that allow overseas workers to plug short-term labour needs and skills shortages as some employers are exploiting the system, Immigration Minister Brendan O’Connor said. “There is no reason why we wouldn’t be looking to properly protect the efficacy and integrity of this scheme by way of legislation,” Mr O’Connor said in a Sky Television interview today. “What we’ve got to do is really remove the loopholes.” Prime Minister Julia Gillard’s ruling Labor party is seeking to gain momentum with voters before the September 14 election after trailing in opinion polls for more than 18 months. The so-called 457 visa programme has been backed by mining magnate Gina Rinehart as

necessary to fill labour shortfalls that may threaten the nation’s investment pipeline that reached US$280 billion as of October 31, according to a government research department. The number of the lowest-paid 457 visa holders, working in the lodging and food services industries, has almost doubled in the past year, Mr O’Connor said in a separate statement yesterday. Australia had 105,600 457 visa holders as of March 31, up 19 percent from the year before, Department of Immigration and Citizenship figures released yesterday show. “My focus is ensuring we have a 457 scheme that is legitimate, to ensure that the employers who use it properly are not disadvantaged against those employers that use it

and another on a Japan Airlines Co Ltd jet parked at Boston’s Logan airport. Ethiopian Airlines Enterprise on Saturday became the world’s first carrier to resume flying Dreamliner passenger jets since the global fleet was grounded three months ago, carrying passengers to neighbouring Kenya from Ethiopia. The ANA flight, with company president Shinichiro Ito and Boeing’s chief of commercial aircraft, Ray Conner, among those on board, left Tokyo’s Haneda airport at 8.59 am local time. It returned without incident at 10.54 am, a spokesman for the airline said. ANA plans at least 230 test flights through May before resuming commercial operations. In addition to the battery fix approved by the Federal Aviation Administration (FAA) in the United States, Japan’s Civil Aviation Bureau has requested its airlines monitor the battery current while the jet is in the air and inspect used batteries. ANA owns 17 of the 50 Dreamliners, which have been grounded since mid January, while local rival JAL has seven of the carbon composite aircraft in its fleet. JAL will start test flying its Dreamliners early next month with the aim of returning to normal operation in June. Neither Japanese carrier, which on Tuesday will release their earnings results for the three months that ended March 31, have said how much the 787 grounding has cost them in lost revenue. Reuters

improperly,” Mr O’Connor said. It’s important “Australian citizens and permanent residents get the first options for employment before we look overseas,” he said. Ms Rinehart, Australia’s richest person, sparked union criticism after getting government approval last May to hire more than 1,700 overseas workers on her Roy Hill iron ore project in Western Australia. Ms Gillard is attempting to boost her minority government’s economic credentials, which were damaged when a slump in tax revenue forced her in December to abandon a pledge to return the May 14 budget to surplus. The nation’s first female leader faces the challenge of rebalancing a two-speed economy where mining regions in the north and west thrive off Chinese demand, while manufacturing and tourism in the south and east struggle. Employers cut payrolls more than forecast in March, with the jobless rate unexpectedly increasing to 5.6 percent, the highest level since November 2009, government data showed April 11. Bloomberg News

The number of 457 visa holders almost doubled in 2012

April 29, 2013

Markets Hang Seng Index NAME

PRICE

DAY %

VOLUME

34.25

1.331361

31673050

CHINA UNICOM HON

ALUMINUM CORP-H

2.87

-2.711864

17960000

CITIC PACIFIC

BANK OF CHINA-H

3.58

1.416431

457056095

BANK OF COMMUN-H

6.08

0.8291874

46237318

BANK EAST ASIA

31.3

0.805153

2383160

12.98

2.365931

BOC HONG KONG HO

26.4

CATHAY PAC AIR

AIA GROUP LTD

BELLE INTERNATIO

CHEUNG KONG

DAY %

VOLUME

11.08

2.592593

52253312

9.51

-0.105042

5648219

PRICE

DAY %

74.5

0.6756757

2233228

SANDS CHINA LTD

42.65

1.426873

12299520

SINO LAND CO

12.96

-2.556391

9467809

SUN HUNG KAI PRO

113.9

-0.0877193

4535452

POWER ASSETS HOL

VOLUME

0.5162242

2842383

-0.2770083

74061710

COSCO PAC LTD

10.44

-1.694915

6889800

SWIRE PACIFIC-A

98.4

1.026694

1099757

27840833

ESPRIT HLDGS

10.04

3923894

TENCENT HOLDINGS

259

1.330203

3385956

1.538462

16731786

HANG LUNG PROPER

30.1

-0.660066

4383518

TINGYI HLDG CO

21.2

3.163017

9821971

13.3

0.6051437

2118049

128.7

0.546875

1564925

WANT WANT CHINA

12.38

2.995008

23253175

WHARF HLDG

70.15

0.7902299

3787915

-0.170503

4223897

6.3

-1.5625

33725112

CHINA CONST BA-H

6.38

0.7898894

281778006

CHINA LIFE INS-H

20.9

1.456311

55934701

CHINA MERCHANT

24.95

1.629328

3678296

CNOOC LTD

HANG SENG BK

56.2

-0.7067138

4577021

HENGAN INTL

HENDERSON LAND D

78.25

0.772698

4574167

HONG KG CHINA GS

23.35

0.6465517

6604449

HONG KONG EXCHNG

130

-1.886792

4288062

HSBC HLDGS PLC

83.4

0.7246377

14342098

84.1

0.1786778

14517748

HUTCHISON WHAMPO

23.45

-0.212766

17227258

IND & COMM BK-H

CHINA PETROLEU-H

8.47

-0.7033998

91253390

LI & FUNG LTD

CHINA RES ENTERP

26.1

0.967118

4850629

MTR CORP

31.4

0.8025682

4225638

CHINA RES LAND

23.25

0.6493506

8821087

NEW WORLD DEV

13.54

-1.023392

17773340

CHINA RES POWER

24.95

1.629328

4225864

PETROCHINA CO-H

9.88

1.960784

119754521

CHINA SHENHUA-H

27.05

0.744879

32622194

PING AN INSURA-H

60.15

0.9228188

10255385

CHINA OVERSEAS

NAME

14.4

117.1

CLP HLDGS LTD

PRICE

68.15

CHINA COAL ENE-H

CHINA MOBILE

NAME

-0.0602047

5365408

5.41

0.744879

215570763

10.16

0.9940358

16006329

MOVERS

1 22680

INDEX 22547.71 HIGH

22673.52

LOW

21996.82

52W (H) 23944.74 (L) 18056.4

21990

24-April

26-April

Hang Seng China Enterprise Index NAME

PRICE

DAY %

VOLUME

AGRICULTURAL-H

3.69

1.652893

151143625

AIR CHINA LTD-H

6.21

0.6482982

9312000

ALUMINUM CORP-H

2.87

-2.711864

17960000

ANHUI CONCH-H

27.8

0.1801802

13405615

BANK OF CHINA-H

3.58

1.416431

457056095

CHINA SHENHUA-H

NAME

PRICE

DAY %

VOLUME

PRICE

DAY %

VOLUME

CHINA PACIFIC-H

27.9

1.086957

10835250

YANZHOU COAL-H

8.44

-6.222222

69034210

CHINA PETROLEU-H

8.47

-0.7033998

91253390

ZIJIN MINING-H

2.34

-1.680672

43597000

CHINA RAIL CN-H

7.9

3.133159

24415816

ZOOMLION HEAVY-H

8.07

-1.465201

20707080

CHINA RAIL GR-H

3.95

1.282051

22796061

ZTE CORP-H

12.4

-0.4815409

4212676

27.05

0.744879

32622194

6.08

0.8291874

46237318

CHINA TELECOM-H

3.91

44063320

28.15

12.15139

12857888

DONGFENG MOTOR-H

11.68

-1.683502

13947490

4.24

0.7125891

42508732

GUANGZHOU AUTO-H

6.37

-2.300613

8405181

CHINA COAL ENE-H

6.3

-1.5625

33725112

HUANENG POWER-H

8.71

1.044084

12438000

CHINA COM CONS-H

7.5

-1.960784

22933782

IND & COMM BK-H

5.41

0.744879

215570763

CHINA CONST BA-H

6.38

0.7898894

281778006

JIANGXI COPPER-H

15.58

-1.142132

21125712

CHINA COSCO HO-H

3.41

0.887574

11459082

PETROCHINA CO-H

9.88

1.960784

119754521

CHINA LIFE INS-H

20.9

1.456311

55934701

PICC PROPERTY &

CHINA LONGYUAN-H

7.19

6230000

PING AN INSURA-H

CHINA MERCH BK-H

16.14

1.001252

29020900

SHANDONG WEIG-H

CHINA MINSHENG-H

9.99

1.731161

91926649

SINOPHARM-H

22.85

-2.765957

11515275

CHINA NATL BDG-H

9.64

-0.7209063

31589111

TSINGTAO BREW-H

52.85

-2.220167

1446416

15.58

3808995

WEICHAI POWER-H

28.25

2.727273

2696180

BANK OF COMMUN-H BYD CO LTD-H CHINA CITIC BK-H

CHINA OILFIELD-H

9.72

0.8298755

10708355

60.15

0.9228188

10255385

7.4

-2.631579

7822950

NAME

MOVERS

3 10930

INDEX 10834.08 HIGH

10928.88

LOW

10529.7

52W (H) 12354.22 10520

(L) 8987.76 24-April

26-April

Shanghai Shenzhen CSI 300 NAME

NAME

PRICE

DAY %

VOLUME

AGRICULTURAL-A

2.69

-0.7380074

98526496

AIR CHINA LTD-A

5.23

-1.506591

5166291

CITIC SECURITI-A

CHONGQING WATE-A

PRICE

DAY %

VOLUME

PRICE

DAY %

6.2

-2.053712

6571968

QINGHAI SALT-A

24.35

-0.7742461

3860060

12.42

-0.7194245

66198652

SAIC MOTOR-A

14.9

0.1344086

20767841

NAME

VOLUME

3.98

-1.240695

15985511

CSR CORP LTD -A

3.98

-0.9950249

16381021

SANY HEAVY INDUS

9.76

-1.810865

19382466

ANHUI CONCH-A

17.61

-0.05675369

17964870

DAQIN RAILWAY -A

7.05

-2.354571

32120187

SHANDONG GOLD-MI

32.13

4503942

BANK OF BEIJIN-A

8.79

2.090592

43843654

DATANG INTL PO-A

4.35

1.162791

6565666

SHANG PHARM -A

11.99

-1.316872

6520537

BANK OF CHINA-A

2.87

-1.034483

34709644

EVERBRIG SEC -A

13.4

-2.75762

16616151

SHANG PUDONG-A

9.88

-0.3027245

52806428

ALUMINUM CORP-A

BANK OF COMMUN-A BANK OF NINGBO-A

4.63

-0.4301075

41941465

GD MIDEA HOLDI-A

13.96

2.271062

22844017

SHANGHAI ELECT-A

3.73

-1.842105

3581817

10.18

-0.1960784

11593667

GD POWER DEVEL-A

2.81

0.3571429

51309572

SHANXI LU'AN -A

15.96

-0.7462687

11209252

4.8

0.2087683

37907083

GEMDALE CORP-A

6.99

1.451379

41422129

SHANXI XISHAN-A

10.53

-0.7540057

7912841

BEIJING TONGRE-A

22.44

-1.578947

9744682

GF SECURITIES-A

13.15

-0.9789157

14805509

SHENZEN OVERSE-A

5.76

0.173913

30445184

BYD CO LTD -A

24.55

3.064652

7882916

GREE ELECTRIC

-0.3831418

11212283

SICHUAN KELUN-A

61.6

-2.56248

674648

21.8

-3.539823

3057671

GUANGHUI ENERG-A

18.38

-2.441614

18997699

SUNING COMMERC-A

5.88

-1.010101

32095456 4097690

BAOSHAN IRON & S

CHINA AVIC AVI-A CHINA CITIC BK-A

4.27

-0.6976744

20002122

HAINAN AIRLINE-A

4.71

-5.040323

43069901

TASLY PHARMAC-A

74.51

2.942802

CHINA CNR CORP-A

4.03

-0.2475248

13007525

HAITONG SECURI-A

10.71

0.4690432

88582416

TSINGTAO BREW-A

37.78

-0.07934409

2264961

CHINA COAL ENE-A

6.81

-1.161103

4342980

HANGZHOU HIKVI-A

36.22

-1.789588

5865052

WEICHAI POWER-A

21.96

-4.852686

9699258 13457108

CHINA CONST BA-A

4.65

-0.6410256

22742004

HENAN SHUAN-A

78.58

-1.775

1822880

WULIANGYE YIBIN

21.95

-0.2272727

CHINA COSCO HO-A

3.37

-2.034884

10597179

HONG YUAN SEC-A

21.45

-0.6484484

33896820

YANGQUAN COAL -A

12.59

-1.94704

6101510

CHINA EAST AIR-A

3.06

-1.923077

7822324

HUATAI SECURIT-A

9.64

-0.8230453

22112830

YANTAI WANHUA-A

18.59

-1.640212

10502752

CHINA EVERBRIG-A

55031877

HUAXIA BANK CO

10.47

2.747792

50156004

YANZHOU COAL-A

15.17

-2.943058

5920172

4.05

-0.7352941

48236100

YUNNAN BAIYAO-A

85.2

-1.010805

1077459

CHINA LIFE INS-A

16.76

15846304

IND & COMM BK-A

CHINA MERCH BK-A

12.15

-0.5728314

33018250

INDUSTRIAL BAN-A

18.16

-0.3839824

71264377

ZHONGJIN GOLD

12.59

1.450443

22206329

CHINA MERCHANT-A

12.13

-0.8986928

22898539

INNER MONG BAO-A

27.59

0.3637686

18292792

ZIJIN MINING-A

3.13

0.3205128

35605034

CHINA MERCHANT-A

25.42

1.194268

8856678

INNER MONG YIL-A

29.24

-3.973727

12315564

ZOOMLION HEAVY-A

7.57

-1.943005

23257399

CHINA MINSHENG-A

9.82

-1.107754

95530352

INNER MONGOLIA-A

4.71

-0.8421053

23635522

ZTE CORP-A

11.34

-1.9879

15877196

CHINA NATIONAL-A

9.02

-4.952582

48291907

JIANGSU HENGRU-A

30.48

1.464714

5679411

CHINA OILFIELD-A

15.53

-0.7667732

2799720

CHINA PACIFIC-A

18.76

-1.315097

19668526

6.73

-0.7374631

18534969

CHINA PETROLEU-A

JIANGSU YANGHE-A

58.38

-5.533981

7205043

JIANGXI COPPER-A

20.84

-0.5725191

11617515

JINDUICHENG -A

10.32

-2.457467

5964602

17.38

-0.855676

21824148

173.99

-1.533673

1630764

CHINA RAILWAY-A

5.14

0.390625

14650663

KANGMEI PHARMA-A

CHINA RAILWAY-A

2.79

-0.3571429

16720948

KWEICHOW MOUTA-A

CHINA SHENHUA-A

20.49

-0.9666506

9284215

LUZHOU LAOJIAO-A

24.43

-1.093117

5857758

CHINA SHIPBUIL-A

4.19

-4.772727

57783237

METALLURGICAL-A

2.04

0.4926108

14175798

CHINA SOUTHERN-A

3.45

-1.988636

15793098

NINGBO PORT CO-A

2.46

0.4081633

9104940

8.48

-0.4694836

14074849

18.7

-0.6903877

33673898

CHINA STATE -A

3.44

-0.5780347

48979379

PETROCHINA CO-A

CHINA UNITED-A

3.57

-1.923077

117328713

PING AN BANK-A

CHINA VANKE CO-A

11.03

0.4553734

48444343

PING AN INSURA-A

39.81

-0.8221226

18863711

CHINA YANGTZE-A

7.13

-0.140056

16584791

POLY REAL ESTA-A

11.63

0.4317789

28203451

10.51

-0.9425071

37170943

QINGDAO HAIER-A

12.82

-0.927357

6614424

NAME

PRICE DAY %

Volume

NAME

PRICE DAY %

Volume

ACER INC

24.1 -0.4132231

8841124

CHONGQING CHAN-A

MOVERS

243

7 2510

INDEX 2447.306 HIGH

2505.24

LOW

2447.08

52W (H) 2791.303 (L) 2102.135

2440

24-April

26-April

FTSE Taiwan 50 Index

ADVANCED SEMICON ASIA CEMENT CORP

25.85

NAME

FORMOSA PLASTIC

72.2

10095587

FOXCONN TECHNOLO

77.4

-1.023018

3716440

42.3

0.7142857

17102283

TSMC

-1.147228

25613052

37.2 -0.6675567

2744061

FUBON FINANCIAL

ASUSTEK COMPUTER

325

-2.985075

3292342

HON HAI PRECISIO

76.2

-1.550388

69682746

AU OPTRONICS COR

13.2

-1.123596

73336520

HOTAI MOTOR CO

258.5

1.571709

333189

PRICE DAY %

Volume

TAIWAN MOBILE CO

104

TPK HOLDING CO L

580

2.112676

6699090 5229630

108.5

1.401869

36776724

UNI-PRESIDENT

58.5

-1.182432

7273368

UNITED MICROELEC

11.2 -0.8849558

29071734

CATCHER TECH

144

-1.706485

9088716

HTC CORP

277.5

-1.595745

23504508

29.4

0.8576329

12854894

CATHAY FINANCIAL

38.6

0.1297017

17746884

HUA NAN FINANCIA

16.95 -0.2941176

4855562

YUANTA FINANCIAL

14.65

-2.006689

13461333

CHANG HWA BANK

16.8 -0.8849558

7241826

LARGAN PRECISION

736

6.976744

1493277

YULON MOTOR CO

50.4

-1.176471

2167272

CHENG SHIN RUBBE

96.1

-3.9

19126931

LITE-ON TECHNOLO

1.532567

7467913

CHIMEI INNOLUX C

17.8

-1.928375

53386743

MEDIATEK INC

355

-1.933702

6550074

CHINA DEVELOPMEN

8.32

-0.952381

42285189

MEGA FINANCIAL H

22.9

-1.505376

34554994

CHINA STEEL CORP

26.1 -0.1912046

13159443

NAN YA PLASTICS

59.6

0.3367003

13106003

CHINATRUST FINAN

17.7

37003046

PRESIDENT CHAIN

183

-1.081081

1243512

CHUNGHWA TELECOM

94.1

0.3198294

6321836

QUANTA COMPUTER

59.9

1.870748

9670659

35.25

19.05

1.329787

31015505

SILICONWARE PREC

3.070175

28813765

DELTA ELECT INC

COMPAL ELECTRON

142

2.158273

6399666

SINOPAC FINANCIA

14.6 -0.3412969

17325471

FAR EASTERN NEW

31.5 -0.3164557

7840860

SYNNEX TECH INTL

48.5

3312133

FAR EASTONE TELE

72.9

4146114

TAIWAN CEMENT

38.9 -0.2564103

3155822

FIRST FINANCIAL

17.85

1.532033 0

9111728

TAIWAN COOPERATI

16.9

0.2967359

7112944

FORMOSA CHEM & F

69.5 -0.4297994

5632905

TAIWAN FERTILIZE

70.6 -0.4231312

2121930

FORMOSA PETROCHE

78.8

1896828

TAIWAN GLASS IND

1.677419

29.05

1.929825

2573880

WISTRON CORP

MOVERS

5 5630

INDEX 5589.73 HIGH

5624.13

LOW

5534.09

52W (H) 5639.93 (L) 4719.96

5530

24-April

26-April

April 29, 2013

Markets Gaming Stocks - Daily Performance (Hong Kong Stock Exchange) 34.5

63.2

34.4

62.7 18.2

34.3

62.2

34.2

average 34.304

Min 34.15

34.0

Last 34.25

18.1

61.7

34.1 Max 34.45

18.3

Max 63.2

average 62.616

Min 61.2

61.2

Last 63.2

Max 18.26

average 18.172

Min 18.06

Last 18.2

19.90

43.5

24.3

19.85

43.1

18.0

24.0

19.80 42.7

Max 43.5

average 42.902

Min 42.35

42.3

Last 42.65

Max 19.84

average 19.78

Commodities

METALS

PRICE

DAY %

WTI CRUDE FUTURE Jun13

-0.683468603

BRENT CRUDE FUTR Jun13

103.16

GASOLINE RBOB FUT May13

283.49

GAS OIL FUT (ICE) Jun13 NATURAL GAS FUTR Jun13 HEATING OIL FUTR May13

YTD %

(H) 52W

Last 19.76

(L) 52W

-0.524120227

105.6800003

81.34999847

-0.241756116

-4.42838614

116.6699982

90.91999817

0.821537805

-2.042156185

330.369997

237.7199888

862.5

0.203311066

-5.427631579

992.75

799.25

4.223

0.547619048

20.38198404

4.457000256

3.203999996

290.12

-0.017231278

-4.054500959

327.1399975

258.5000038

Gold Spot $/Oz

1461.92

0.9697

-12.1685

1796.08

1322.06

Silver Spot $/Oz

24.0025

2.7759

-20.284

35.365

22.0713

1477.5

1.6372

-2.652

1742.8

1374.55

681

0.8441

-2.667

786.5

553.75

1878

-3.245749614

-9.406657019

2200.199951

1818 6762.25

Platinum Spot $/Oz Palladium Spot $/Oz LME ALUMINUM 3MO ($) LME COPPER 3MO ($)

7030

-2.08913649

-11.36048418

8496.75

LME ZINC

1897

-2.01446281

-8.798076923

2230

1745

15205

-1.362309439

-10.87338804

18920

15075 14.79500103

3MO ($)

LME NICKEL 3MO ($) AGRICULTURE ROUGH RICE (CBOT) Jul13 CORN FUTURE

Min 19.72

Jul13

WHEAT FUTURE(CBT) Jul13

15.07

-0.264725347

-4.287075262

17.07500076

619.75

-0.760608487

-11.11509502

824

527

692.5

-1.598579041

-12.75590551

900

664.75

1381

0.637638914

-1.021322344

1605.75

1217.75

133.95

-2.510917031

-10.43129388

202.1999969

133.0500031

SOYBEAN FUTURE Jul13 COFFEE 'C' FUTURE Jul13 SUGAR #11 (WORLD) Jul13

17.42

COTTON NO.2 FUTR Jul13

84.25

0.230149597 1.225519644

-11.75278622 9.600624431

23.05999947 94.19999695

17.25 69.94999695

COUNTRY MAJOR

ASIA PACIFIC

CROSSES

AUD GBP CHF EUR JPY MOP HKD CNY INR THB SGD TWD PHP IDR AUDJPY EURCHF EURGBP EURCNY EURMOP EURJPY HKDMOP

Max 24.25

average 23.866

Min 23.4

Last 23.45

World Stock Markets - Indices

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

1.0276 1.5473 0.9429 1.303 98.05 7.996 7.7633 6.1651 54.375 29.24 1.2364 29.639 41.265 9722 100.769 1.22761 0.84189 8.0382 10.3988 127.73 1.03

-0.4167 0.2202 0.0318 -0.3213 1.0913 0.0075 0.009 0.0892 -0.2759 -0.4104 0.1132 0.1552 -0.0606 -0.0411 1.4935 0.4277 0.5701 0.1219 0.5222 1.4405 0

-0.9828 -4.3459 -2.9165 -1.213 -12.1877 -0.1601 -0.1636 1.0624 1.1402 4.5828 -1.2132 -2.0446 -0.6301 0.7303 -11.3547 -1.6398 -3.1441 2.2306 1.2655 -11.0859 -0.0097

1.0625 1.6381 0.9972 1.3711 99.95 8.0111 7.7713 6.3964 57.3275 32 1.2971 30.203 43.975 9904 105.433 1.25692 0.88151 8.4957 10.9254 131.12 1.032

0.9582 1.4832 0.9022 1.2043 77.13 7.9824 7.7498 6.1594 51.3863 28.56 1.2152 28.913 40.54 9175 74.482 1.20051 0.77553 7.7018 9.6245 94.12 1.029

NAME

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

ARISTOCRAT LEISU

3.81

1.329787

20.95238

3.94

2.29

VOLUME CRNCY 2428450

CROWN LTD

12.8

-0.3891051

19.96251

12.98

8.06

1141538

AMAX HOLDINGS LT

0.84

1.204819

-40

1.9

0.75

197900

BOC HONG KONG HO

26.4

1.538462

9.543567

27.1

20.85

16731786

0.295

11.32076

0.42

0.215

6.17

0.3252033

3.005012

6.74

2.8

106858 17227258

CHEUK NANG HLDGS CHINA OVERSEAS

23.45

-0.212766

1.51515

25.6

14.624

CHINESE ESTATES

13.58

-0.2936858

11.9592

13.8

7.697

1978500

CHOW TAI FOOK JE

10.46

0.965251

-15.9164

13.4

8.4

7599200

EMPEROR ENTERTAI

2.31

-3.34728

22.22222

2.49

1.1

1280000

FUTURE BRIGHT

2.47

6.008584

102.459

2.75

0.77

12948200

COUNTRY

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

DOW JONES INDUS. AVG

14712.55

0.07992762

12.27406

14887.51

12035.08984

NASDAQ COMPOSITE INDEX

3279.263

-0.3259284

8.602355

3306.95

2726.68

GALAXY ENTERTAIN

34.25

1.032448

12.85008

35.7

16.94

16095698

FTSE 100 INDEX

6426.42

-0.250986

8.962816

6533.99

5229.76

HANG SENG BK

128.7

0.546875

8.424603

131.5

99.2

1564925

DAX INDEX

7814.76

-0.2310778

2.658424

8074.47

5914.43

HOPEWELL HLDGS

29.6

0.5093379

-10.97744

35.3

19.049

1713987

HSBC HLDGS PLC

83.4

0.7246377

2.583022

88.45

59.8

14342098 8281200

NIKKEI 225

13884.13

-0.3012334

33.56316

13983.87

8238.96

HANG SENG INDEX

22547.71

0.6538477

-0.4820116

23944.74

18056.4

CSI 300 INDEX

2447.306

-0.8334701

-2.998313

2791.303

2102.135

HUTCHISON TELE H

3.97

1.794872

11.51686

4.05

2.98

LUK FOOK HLDGS I

22.05

-0.2262443

-9.631146

30.05

14.7

3842500

MELCO INTL DEVEL

15.4

2.52996

70.92119

15.58

5.12

10440400 6795249

TAIWAN TAIEX INDEX

8022.06

0.003864493

4.189364

8089.21

6857.35

MGM CHINA HOLDIN

18.2

0.5524862

37.06595

18.449

9.509

KOSPI INDEX

1944.56

-0.3607297

-2.628376

2042.48

1758.99

MIDLAND HOLDINGS

3.53

1.146132

-4.594596

3.249

902000

S&P/ASX 200 INDEX

5097.508

-0.09646384

9.648579

5163.5

3985

NEPTUNE GROUP

0.154

0.6535948

1.315793

0.226

0.084

8080000

4978.507

-0.3206713

15.33166

5026.919

3635.283

NEW WORLD DEV

13.54

-1.023392

12.64559

15.12

7.95

17773340

FTSE Bursa Malaysia KLCI

1711.29

0.2900946

1.322721

1718.08

1526.6

SANDS CHINA LTD

42.65

1.426873

25.62592

43.7

20.65

12299520

SHUN HO RESOURCE

1.51

7.857145

1.67

1.03

NZX ALL INDEX

969.579

0.1699496

9.922986

972.727

755.149

SHUN TAK HOLDING

4.09

0.9876543

-2.386636

4.65

2.56

3194851

PHILIPPINES ALL SHARE IX

4384.48

0.4626182

18.53214

4422.22

3238.77

SJM HOLDINGS LTD

19.76

1.437372

9.777778

22.15

12.34

12506100

SMARTONE TELECOM

13.42

0.1492537

-4.687499

17.38

12.5

1478331

WYNN MACAU LTD

23.45

0.6437768

11.93317

25.5

14.62

18593545

JAKARTA COMPOSITE INDEX

23.4

Macau Related Stocks

CENTURY LEGEND

NAME

19.70

Currency Exchange Rates

NAME ENERGY

23.7

19.75

HSBC Dragon 300 Index Singapor

648.85

0.8

4.47

STOCK EXCH OF THAI INDEX

1582.93

0.5513737

13.72195

1601.34

1099.15

HO CHI MINH STOCK INDEX

474.51

-0.4364338

14.69074

518.46

372.39

ASIA ENTERTAINME

4.44

0.2257336

45.09804

5.83

2.4

255541

BALLY TECHNOLOGI

54.66

0.7186291

22.25453

54.83

41.74

886004

Laos Composite Index

1340.86

0.7650224

10.37974

1455.82

980.83

BOC HONG KONG HO

3.43

4.573171

11.72639

3.59

2.7

43320

GALAXY ENTERTAIN

4.41

0.6849315

11.08312

4.93

2.25

4700

16.96

-1.965318

19.68948

17.53

10.92

7896830

JONES LANG LASAL

96.5

-0.5462228

14.96307

100.91

61.39

266015

LAS VEGAS SANDS

56.17

-1.628722

21.68544

57.11

32.6127

4991219

MELCO CROWN-ADR

24.27

-0.3285421

44.12114

24.46

9.13

3701107

MGM CHINA HOLDIN

2.1

13.51351

2.44

1.36

10000

MGM RESORTS INTE

13.52

-0.07390983

16.1512

13.78

8.83

13146768

SHFL ENTERTAINME

15.47

-2.704403

6.689655

18.23

11.75

221208

SJM HOLDINGS LTD

2.57

1.581028

11.25541

2.85

1.65

1100

WYNN RESORTS LTD

135.5

0.4373286

20.45515

136.274

84.4902

1900651

INTL GAME TECH

Shanghai Shenzhen Composite index is listing the biggest companies by market capitalisation. All data supplied by Bloomberg unless otherwise indicated.

AUD HKD

USD

April 29, 2013

Opinion

Germany can relax euro austerity and lose nothing Melvyn Krauss

Emeritus economics professor at New York University and a senior fellow at the Hoover Institution at Stanford University

urope needs a new deal that trades less austerity for more structural reform. It can be done without costing Germany a euro cent. The contours of this shift are starting to emerge, with Spain leading the way. To persuade the European Commission to relax its budget deficit targets for 2014 to 2016, the government of Mariano Rajoy last week set out plans to overhaul pension systems and reform labour markets, service sectors and fiscal management. Officials in Brussels are likely to be receptive to these ideas, because they see that current policies risk tearing apart the European Union. EU Commission President José Manuel Barroso warned last week that politically Europe is pushing against the limits of austerity. Barroso is right that the euro area’s crisis-fighting mix needs to change: In Spain, unemployment reached 27 percent, and a new government being formed in Italy will need to offer carrots to secure the

structural changes that will help its economy grow again. Despite the anger of some German politicians about Barroso’s comments, relaxing deficit targets shouldn’t be seen as a bad thing. Austerity doesn’t necessarily increase the periphery’s cost competiveness, which is the sine qua non for ending the crisis. Structural reform is better suited to that task.

Populist politics Austerity applied during a global slump creates suffering that is exploited by protest parties and unscrupulous politicians such as Italy’s Silvio Berlusconi, who are fanning anti-German and anti-euro sentiment to gain votes. So far, structural reforms, such as improving the efficiency of labour markets by jettisoning laws that protect certain professions, have been hard to carry out in the euro-area periphery. The main reason is that those changes require taking on elites – labour unions, taxi drivers, pharmacists or others – that fiercely defend their privileges.

This resistance made labour reform elusive for Mario Monti, Italy’s caretaker prime minister. Mapping an acceptable path to soften or relax austerity in return for more structural reform could allow governments of Europe’s periphery to secure the public support they need to take on such vested interests and win. It could also help politicians who are serious about fixing their nations’ problems to marginalise the likes of Berlusconi. The initiative would have to come from countries that want their budget-deficit targets relaxed. The commission could rule on each case, and decide whether the proposed reforms warranted a concession. The European Central Bank also could deploy its Outright Monetary Transactions bond-buying programme if a country’s bond market is attacked as a result of the policy change. Most likely, as has been the case so far, the very threat of ECB intervention would be sufficient to keep markets calm. The rebalancing effort wouldn’t have to cost

northern governments a single additional euro. This would be a good deal for southern countries such as Greece, Portugal and Ireland. Because of their renewed commitment to structural reform, they could get ECB support for their debt and, at the same time, get the lending countries to soften their austerity programmes. It also should appeal to Germany, and not only because it would help tame the noxious anti-German sentiment. A little more than a decade ago, Chancellor Gerhard Schroeder’s Agenda 2010 transformed Germany from what the Economist magazine called “the sick man of Europe” into Europe’s sole competitive economic power.

Sincere effort For Germany to abandon its view that the periphery countries will change only under austerity-imposed duress, however, it will need to see that structural reform efforts are sincere. Germans will be on board once they realise that this

doesn’t mean giving the periphery a free ride but encouraging a more effective mix of reform. German Finance Minister Wolfgang Schaeuble’s comment Thursday that France can take more time to cut its budget deficit as long as the government doesn’t slacken its structural reforms suggests that officials in Berlin may be open to changing the reform mix. Sceptics will argue that money in exchange for structural reform always has been part of Europe’s crisis-fighting strategy, and that it hasn’t worked. What’s different now is that bailedout periphery economies may have reached a level of suffering that forces national politicians and electorates to get serious about structural changes and begin combating privileged elites in exchange for relief from punitive deficit targets. If these countries offer creditable plans for structural reform, why not take the chance? If the softer approach doesn’t work, harder policies can be restored. Spain has taken a constructive step that should be supported by Germany and the European Commission. Bloomberg View

Austerity doesn’t necessarily increase the periphery’s cost competiveness, which is the sine qua non for ending the crisis

editorial council Paulo A. Azevedo, Tiago Azevedo, José I. Duarte, Emanuel Graça, Mandy Kuok Founder & Publisher Paulo A. Azevedo | pazevedo@macaubusinessdaily.com Editor-in-Chief Tiago Azevedo DEputy Editor-in-Chief Vitor Quintã Associate editor Michael Grimes GROUP SENIOR ANALYST José I. Duarte Newsdesk Luciana Leitão, Stephanie Lai, Tony Lai EDITOR AT LARGE Alex Lee Creative Director José Manuel Cardoso WEB & IT Janne Louhikari Contributors James Chu, João Francisco Pinto, Larry So, Pedro Cortés, Ricardo Siu, Rose N. Lai, Zen Udani Photography Carmo Correia, Manuel Cardoso Assistant to the publisher Laurentina da Silva | ltinas@macaubusinessdaily.com office manager Elsa Vong | elsav@macaubusinessdaily.com Agencies Bloomberg, Reuters, AFP, Xinhua, Lusa, Project Syndicate Printed in Macau by Welfare Ltd.

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April 29, 2013

Opinion Business

wires

Long live China’s slowdown

Leading reports from Asia’s best business newspapers

Jakarta Globe Central banks in Southeast Asia inched closer to agreeing on rules allowing commercial banks to expand within the region. To qualify for the improved market access, banks must reach the status of Qualified Asean Banks. Requirements include having headquarters in Asean and meeting certain thresholds on capital adequacy and consolidation, restrictions on large exposures, accounting and transparency. The agreement principles “will be complete by the end of this year,” said Mulya Siregar, executive director of banking research and regulation at Bank Indonesia.

Korea Herald South Korean workers at a jointly run industrial complex in North Korea returned home on Saturday, Seoul officials said. According to officials, 11 workers went home from the Gaeseong industrial complex with 116 more scheduled to follow. As of Friday, there were 175 South Koreans at the factory zone. Seoul ordered for all remaining workers to return home from Gaeseong, after Pyongyang spurned a proposal for talks to resolve disputes over the factory park, which is considered the last remnant of inter-Korean rapprochement.

China Daily Xin Hua Merchandise Exchange, which is offering fuel oil and methanol as its first batch of commodities, was launched on Saturday in Daqing. It aims to develop into an influential spot trading platform and help China gain a bigger say in the international oil market. The exchange is controlled by Xinhua News Agency and cosponsored by Daqing municipal government, and Guangdong Zhenrong Energy Co Ltd (GDZR), a state-owned company. GDZR is one of China’s five companies that have the rights to import crude oil from abroad.

Yomiuri Shimbun Bank of Japan Governor Haruhiko Kuroda and economists in the private sector are far apart on their views of whether the central bank can meet its inflation target in two years. Mr Kuroda expressed confidence that the central bank and government’s 2 percent inflation target can be achieved by the end of fiscal 2015. “It [the Bank of Japan’s projection] is unreasonably bullish,” said Junichi Makino, chief economist at SMBC Nikko Securities. Naka Matsuzawa, economist at Nomura Securities Co., said monetary policy is not enough to prompt Japanese companies to raise prices as they face global competition.

Stephen S. Roach

Faculty member at Yale University and former chairman of Morgan Stanley Asia

t 7.7 percent, China’s annual GDP growth in the first quarter of this year was slower than many expected. While the data were hardly devastating relative to a consensus forecast of 8.2 percent, many (including me) expected a second consecutive quarterly rebound from the slowdown that appeared to have ended in the third quarter of 2012. China doubters around the world were quick to pounce on the number, expressing fears of a stall, or even a dreaded double dip. But slower GDP growth is actually good for China, provided that it reflects the long-awaited structural transformation of the world’s most dynamic economy. The broad outlines of this transformation are well known – a shift from export- and investment-led growth to an economic structure that draws greater support from domestic private consumption. Less well known is that a rebalanced China should have a slower growth rate – the first hints of which may now be evident. A rebalanced China can grow more slowly for one simple reason: By drawing increased support from services-led consumer demand, China’s new model will embrace a more labour-intensive growth recipe. The numbers seem to bear that out. China’s services sector requires about 35 percent more jobs per unit of GDP than do manufacturing and construction – the primary drivers of the old model. That number has potentially huge implications, because it means that China could grow at an annual rate in the 7-8 percent range and still achieve its objectives with respect to employment and poverty reduction. China has struggled to attain these goals with anything less than 10 percent growth, because the old model was not generating enough jobs per unit of output. As Chinese manufacturing moved up the value chain, firms increasingly replaced workers with machines embodying the latest technologies. As a result, its economic model spawned a labour-saving, capital-intensive growth dynamic.

Viable alternative On one level, that made sense. Capital-labour substitution is at the heart of modern productivity strategies for manufacturing-based economies. But it left China in a deepening hole: increasingly deficient in jobs per unit of output, it needed more units of output to absorb its surplus labour. Ultimately, that became more of a problem than a solution. The old manufacturing model, which fuelled an

unprecedented 20-fold increase in per capita income relative to the early 1990’s, also sowed the seeds of excessive resource consumption and environmental degradation. Services-led growth is, in many ways, the antidote to the “unstable, unbalanced, uncoordinated, and ultimately unsustainable” growth model that former Premier Wen Jiabao’s famously criticised in 2007. Yet services offer more than just a labour-intensive growth path. Compared to manufacturing, they have much smaller resource and carbon footprints. A servicesled model provides China with an alternative, environmentally friendlier, and ultimately more sustainable economic structure. It is premature, of course, to conclude that a services-led transformation to slower growth is now at hand. The latest data hint at such a possibility, with the tertiary sector (services) expanding at an 8.3 percent annual rate in the first quarter of this year – the third consecutive quarter of acceleration and a halfpercentage point faster than the 7.8 percent first-quarter gain recorded by the secondary sector (manufacturing and construction). But it will take more than a few quarters of mildly

Slower GDP growth is actually good for China, provided that it reflects the longawaited structural transformation of the world’s most dynamic economy

encouraging data to validate such an important shift in the Chinese economy’s underlying structure. Not surprisingly, China sceptics are putting a different spin on the latest growth numbers. Fears of a shadowbank-induced credit bubble now top the worry list, reinforcing longstanding concerns that China may succumb to the dreaded “middle-income trap” – a sustained growth slowdown that has ensnared most highgrowth emerging economies at the juncture that China has now reached.

Global reach China is hardly immune to such a possibility. But it is unlikely to occur if China can carry out the services-led proconsumption rebalancing that remains the core strategic initiative of its current (12th) Five-Year Plan. Invariably, the middleincome trap afflicts those emerging economies that cling to early-stage development models for too long. For China, the risk will be highest if it sticks with the timeworn recipe of unbalanced manufacturingand construction-led growth, which has created such serious sustainability problems. If China fails to rebalance, weak external demand from a crisis-battered developed world will continue to hobble its export

machine, forcing it to up the ante on a credit- and investmentled growth model – in effect, doubling down on resourceintensive and environmentally damaging growth. But I remain hopeful that China’s new leadership team will move quickly to implement its new model. There are no viable alternatives. Financial markets, as well as growth-starved developed economies, are not thrilled with the natural rhythm of slower growththatarebalancedChinese economy is likely to experience. Resource industries – indeed, resource-based economies like Australia, Canada, Brazil, and Russia – have become addicted to China’s old strain of unsustainable hyper-growth. Yet China knows that it is time to break that dangerous habit. The United States is likely to have a different problem with consumer-led growth in China. After all, higher private consumption implies an end to China’s surplus saving – and thus to the seemingly openended recycling of that surplus into dollar-based assets such as U.S. Treasury bills. Who will then fund America’s budget deficit – and on what terms? Just as China must embrace slower growth as a natural consequence of its rebalancing imperative, the rest of the world will need to figure out how to cope when it does. © Project Syndicate

April 29, 2013

Closing Iceland ousts government

Letta appointed prime minister

Icelanders rejected the government that led the economy back to growth amid impatience over efforts to restore household wealth to pre-crisis levels. The opposition Independence Party, which has promised to lower taxes, gained 2.8 percentage points from the last election to 26.5 percent, according to a count of 66 percent of the votes. The Progressive Party jumped 7.2 percentage points to 22 percent after pledging to writedown mortgage debt for consumers. The two, which are both opposed to continuing European Union membership talks, may now form a government.

Enrico Letta was sworn in as Italian prime minister yesterday after assembling a 21-member Cabinet that sealed a truce with Silvio Berlusconi and promised to end a two-month political deadlock. Mr Letta named Bank of Italy Director General Fabrizio Saccomanni finance minister and ex-Senate Vice President Emma Bonino foreign minister. The new administration reunites the broad coalition that stood behind Mario Monti, until it collapsed in December. Two policemen were wounded in a shooting outside government offices yesterday, just as the new coalition cabinet was being sworn in.

S. Korean citizens leaving Gaeseong Total of 175 workers were still in the industrial complex on Saturday

outh Korean workers began to return to Seoul on Saturday from an industrial park jointly run with North Korea. About 11 of the 175 South Koreans at the Gaeseong industrial zone had come back, while 115 more

were expected to follow, after an agreement was reached with North Korean officials on the logistics of the pull-out, according to a text message from the South’s Unification Ministry yesterday. The remainder are expected to return today.

South Korea’s President Park Geun-hye made the “inevitable” decision to pull citizens from Gaeseong, which shut down more than two weeks ago, Unification Minister Ryoo Kihl Jae told reporters in Seoul. North Korea ignored a deadline to accept an offer for talks on reopening the facility. The Korean peninsula has been on edge since February, when Kim Jongun’s regime detonated an atomic bomb in defiance of United Nations sanctions and then threatened preemptive nuclear strikes against its enemies. The North on April 8 recalled its workers from Gaeseong, the last point of inter-Korean exchange and an important cash source for the impoverished nation. North Korea said late Saturday that the South has “responsibility for the total closure” of Gaeseong, saying it would damage the southern nation, according to the official Korean Central News Agency, which cited a spokesman for the General Bureau for Central Guidance.

‘Serious measures’ North Korea’s National Defence Commission had threatened “final, decisive and serious measures” against the South’s “ultimatums,” according to a statement on KCNA. The South should withdraw its citizens from Gaeseong if it’s concerned about their wellbeing, KCNA said. The complex, about 10 kilometres (6 miles) north of the demilitarised zone

between the two countries, employs more than 53,000 North Koreans at 123 South Korean companies. North Korea generates US$100 million in annual profits there, while South Korea makes quadruple that amount, according to Yang Moo Jin, a professor at the University of North Korean Studies in Seoul. North Korea on April 3 blocked South Koreans’ access to the complex, only allowing them to leave. With all traffic from the South into Gaeseong banned, the South Koreans have had to endure a shortage of food and medical resources. With the U.S. and South Korea calling on North Korea to return to negotiations, Ms Park’s options to pressure Mr Kim are “very limited,” said Kim Young Yoon, a research fellow at the Korea Institute for National Unification in Seoul. South Korean companies operating in Gaeseong have urged the government to break the impasse and seek damages from the loss of operations. The association representing them yesterday called for talks between the two sides. The Export-Import Bank of Korea revived its pledge to expand financial aid to companies running plants in the complex, the state-run lender said in an e-mailed statement yesterday, without giving details. The bank has provided 300 billion won (US$270 million) of aid, including lower lending rates and higher ceilings on loans, it said. Reuters

Mitsubishi UFJ eyes Morgan Stanley assets M

itsubishi UFJ Financial Group Inc., Japan’s biggest bank by market capitalisation, is in talks to buy Morgan Stanley’s trust-banking assets, said two people with knowledge of the matter. The assets are valued at about US$4 billion, according to the people, who asked not to be identified while talks are continuing. UnionBanCal Corp, the Japanese bank’s San Francisco-based unit, plans to acquire the business from Morgan Stanley, the people said. Nikkei newspaper, which earlier yesterday reported the negotiations, said the deal would need approval from the U.S. The purchase by Morgan Stanley’s largest shareholder would underscore Japanese banks’ interest in acquiring assets to expand operations, especially overseas, as

demographic changes including a shrinking and ageing population slow lending demand at home. Mitsubishi UFJ this month agreed to pay US$3.7 billion for U.S. property lending assets from Deutsche Bank AG through UnionBanCal. Mika Watanabe, a Morgan Stanley spokeswoman in Tokyo, and Yuji Okumura, a spokesman for Mitsubishi UFJ in the city, both declined to comment. The Japanese bank owns a 22 percent stake in Morgan Stanley, according to data compiled by Bloomberg. Mitsubishi UFJ has stepped up acquisitions in the U.S., buying UnionBanCal in 2008 and Santa Barbara-based Pacific Capital Bancorp last year as persistent deflation inhibits loan demand at home. The announced purchase of U.S. real-estate loan assets

New cases may lead to increased scrutiny Mitsubishi UFJ has stepped up acquisitions in the U.S.

from Deutsche Bank will boost its commercial lending business, mainly on the east coast. Other acquisitions in recent years have included its trust banking unit’s deal to purchase a 15 percent stake in AMP Ltd’s Australian assetmanagement business in December 2011, and a buyout of project financing assets previously owned by

Royal Bank of Scotland Group Plc. In the current year, the Japanese lender may increase dividends for the first time in six years, raising payouts to 14 yen a share, as government stimulus measures improve earnings prospects, according to seven of nine analysts surveyed by Bloomberg earlier this month. Bloomberg News