Macau Business Daily, April 5, 2013 by Business Daily

Year II Number 255 MOP 6.00 Wednesday April 5, 2013 Editor-in-chief: Tiago Azevedo Deputy editor-in-chief: Vitor Quintã www.macaubusinessdaily.com

Poor get more cash in run up to May Day

Jiangsu man clear of bird ‘flu Govt says city not affected T

he Health Bureau said yesterday a man from Jiangsu province admitted to Kiang Wu Hospital two days earlier with chest pain and breathing difficulties did not have the latest deadly bird ‘flu virus, H7N9. As Business Daily went to press, four deaths had been officially confirmed on the mainland, out of 10 cases reported. Of the ten confirmed patients, four were from Jiangsu, two in Shanghai municipality,

one from Anhui province and three from Zhejiang province said Xinhua, China’s official news agency. The mainland outbreak has no impact on the decision to open the Gongbei border for longer during the Ching Ming holiday, said Alexis Tam Chong Weng, head of the Chief Executive’s office. A note to investors from Wells Fargo Securities LLC in New York said the impact of H7N9 on Macau was in its view likely to be “marginal”. More on page 2

Court throws out appeal on StarWorld

Mobile phones to act as MACAUpass cards

he Court of Second Instance has rejected an appeal brought by some NAPE residents against a government decision to approve the construction of the StarWorld Hotel in 2004. The judgement says it was not the court’s task to rule on the legality of a Chief Executive’s dispatch revoking the urban development plan for NAPE or on the eventual unlawfulness of the construction for having thwarted some of the provisions in that specific urban plan.

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Poor families are to get the equivalent of an extra month’s allowance from the government this month, starting from today. More than 5,000 households receiving regular monthly allowances from the government are entitled to receive the additional cash.

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I SSN 2226-8294

Brought to you by

2013-04-05

2013-04-06

2013-04-07

21˚ 25˚

16˚ 21˚

15˚ 21˚

HANG SENG INDEX 22530

22484

22438

22392

22346

22300

April 3

eople could soon be able to use their mobile phones like stored-value cards to take the bus, park their cars and shop for groceries, according to Macau Pass SA. The issuer of MACAUpass cards aims to have the system that allows this up and running this year. Macau Pass deputy general manager David Lao told Business Daily yesterday the company was negotiating with some of the city’s telcos about developing a SIM card for mobile phones with the functions of a MACAUpass card.

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HSI - MOVERS Name CHINA RES ENTERP

1.72

LENOVO GROUP LTD

1.46

WANT WANT CHINA

1.19

HANG LUNG PROPER

1.17

POWER ASSETS HOL

1.15

KUNLUN ENERGY CO

-1.33

CHINA COAL ENE-H

-1.76

CATHAY PAC AIR

-1.99

BELLE INTERNATIO

-2.04

TINGYI HLDG CO

-2.41

Source: Bloomberg

Second Suen lawsuit over LVS Macau licence Page 6

Estate agent law clears out ‘grey’ operators Page 7

Ho Tram developer gets nod from Vietnam govt Page 16

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business daily April 5, 2013

macau Macau, Zhuhai meet over Hengqin development Representatives from Macau, led by the government’s spokesperson Alexis Tam Chong Weng, met with officials from the Zhuhai administration on Hengqin Island on Wednesday. Talks focused on the plan to link Macau’s Light Rapid Transit railway to Guangzhou Intercity Railway’s future extension to Hengqin, as well as on strategies to attract businesses for the 5-square kilometre Guangdong-Macau Cooperation Industrial Park. Secretary for Economy and Finance Francis Tam mentioned last month that a committee to assess project proposals from Macau firms will be formed this month.

Bird ‘flu on mainland not affecting Macau: govt No reports from World Health Organization of human to human transmission Michael Grimes

michael.grimes@macaubusinessdaily.com

acau need not be worried about four confirmed human deaths on the mainland linked to a strain of bird influenza known as H7N9, said the government. And the outbreak has no impact on the decision to open the Gongbei border for two hours longer during the three days of the Ching Ming holiday, added Alexis Tam Chong Weng, head of the Chief Executive’s office. “For the [H7N9] ‘flu this time, there is still not any case recorded in Macau,” Mr Tam told a press conference on Wednesday. “The cases are currently limited to the northern region of China so I think there will be no problem for us to open longer hours in the border in these three days.” The World Health Organization said on April 1 that mainland authorities had informed it of an initial three H7N9 cases. “The cases were reported from Shanghai (two cases) and Anhui province (one case). All three cases presented with respiratory tract infection with progression to severe pneumonia and breathing difficulties. Disease onset was between 19 February and 15 March 2013. Two of the cases died,” said WHO. Mainland official have since confirmed another two deaths. On Wednesday the China Health and Family Planning Commission notified WHO of an additional four cases of human infection, all in Jiangsu province in eastern China. “All of these patients are in a critical condition,” said WHO.

No screening China’s wet markets – where live poultry are displayed and sold – have previously been identified by medical experts as a likely transmission route for avian ‘flu into the human community. WHO has not reported any human to human transmission of the

Government chief spokesman Alexis Tam Chong Weng (Photo: Manuel Cardoso)

H7N9 strain. Macau’s Health Bureau said on Wednesday: “Temporarily there is no need to implement any screening procedures [for avian ‘flu] on the inbound visitors at the border terminals – based on the suggestions from World Health Organization.” The Bureau added Macau was currently on a level 3 alert over the mainland outbreak. The WHO uses an alert scale of 1 to 6, with level 6 being the most serious – a global influenza emergency known as a pandemic. The government’s Alexis Tam gave reassurances to locals and visitors that the outbreak was not currently an issue in Macau. “I believe we don’t need to be worried as there is still no single case recorded in Macau or the Guangdong province. I also believe we have enough capabilities to carry out preventive measures [for the

We attribute some of the recent underperformance of Macau gaming stocks to concerns over Chinese reports of a new deadly variant of avian influenza Wells Fargo

disease],” he stated. There are a growing number of transport routes between Macau and the rest of mainland China – including a new high-speed rail network that links Beijing and Shanghai directly to Guangzhou and then to Gongbei via a new section opened in December. Any disease outbreak on the mainland could therefore spread rapidly to Macau. In 2009 when an outbreak of swine ‘flu – a strain known as H1N1 – spread quickly from Mexico across the world, Macau casino operators and other landlords in the city introduced emergency measures including in some cases hourly disinfection of lift buttons and door handles. By June 22 that year the Health Bureau confirmed three H1N1 cases here. No one died in Macau during that outbreak, but the lesson that businesses

learned was that public perception of danger could be as damaging to commercial prospects as actual danger. A different health emergency also affecting human lungs – severe acute respiratory syndrome – hit Hong Kong and southern China in late 2002 and the first half of 2003. It killed 775 worldwide – 38 percent of them in Hong Kong and another 45 percent on the mainland according to WHO data. Only one – non-fatal – case of Sars was confirmed in Macau. The city suffered greatly economically however as panic spread and people stopped travelling in and to the Pearl River Delta Region. In the first half of 2003, arrivals to Macau by ferry dipped by more than 40 percent compared to the fourth quarter of 2002. According to recent figures from the Census and Statistics Bureau, one in five Macau employees works in a casino, so any sudden downturn in tourism could have a major effect on the local economy. A note to investors from Wells Fargo Securities LLC in New York in Wednesday United States time, said the impact of H7N9 on Macau was in its view likely to be “marginal”. “We attribute some of the recent underperformance of Macau gaming stocks to concerns over Chinese reports of a new deadly variant of avian influenza (H7N9) ,” said senior analyst Cameron McKnight and his research team. “While any spread of life threatening influenza could potentially impact Macau visitation, we believe any impact is likely marginal and note that no humanto-human transmission of the ‘flu has been recorded so far. In our view, it would take a pandemic on par with the 2002-03 Sars outbreak to materially impact Macau visitation and revenues,” added the note. With Tony Lai

April 5, 2013 business daily | 3

MACAU

Court throws out appeal on StarWorld The government’s approval for casino did not breach its urban planning rules Vítor Quintã

vitorquinta@macaubusinessdaily.com

he Court of Second Instance has rejected an appeal brought by some NAPE residents against a government decision to approve the construction of the StarWorld Hotel in 2004. The appeal verdict, dated January 31 but released late last month, divided the three judges. Judge Ho Wai Neng, who was outvoted in the appeal decision, said the government violated the urban development plan for the NAPE district and that the construction of the Galaxy Entertainment Group Ltd’s hotel-casino should not have gone ahead. But the judgement says it was not the court’s task to rule on the legality of a Chief Executive’s dispatch revoking the urban development plan for NAPE or on the eventual unlawfulness of the construction for having thwarted some of the provisions in that specific urban plan. The two-to-one ruling ended a case brought to court in 2007 by a trio of residents that lived n e a r St ar Wor ld. The y argue d that the project approval “openly goes against” the urban plan implemented in 1991. The urban plan permitted a building with a maximum height of 80 metres and a construction area of 43,102 square metres. The StarWorld project called for a 150-metre-tall tower on a construction area of 90,000 square metres. Officials representing Secretary for Transport and Public Works Lau Si Io told the court the urban development plan was no longer relevant because it was revoked

in 2006 by former chief executive Edmund Ho Hau Wah. Mr Ho’s dispatch at the time said the plan was outdated because it had never been revised and was no longer necessary because the district was fully developed. The lawyer representing the residents argued that the NAPE urban plan “was obviously still in effect” when the project was approved in 2004. “Even if all the plots that a plan covers have been developed, the plan continues to regulate any future construction, as well as the use and maintenance of the buildings.” Revoking the plan two years later was simply “an attempt to give an impression of legitimacy to the whole construction procedures”.

No revocation The judges agreed scrapping the plan “could never” be applied retrospectively to alter the legal status of the approval for StarWorld. Business Daily asked Mr Lau’s cabinet for a comment but it got no reply before it went to press. The appeal said an urban plan could only be changed or revised, not revoked. The residents argued “the administration cannot undertake an outright revocation of an urban plan, especially when it results in limiting urban planning to a simple confirmation of individual decisions”. Transport and Public Works representatives said Macau had “no rules for the drafting and approval” of legally binding urban plans. In fact,

urban plans were not “especially set out in the law”. But the judgement says the court could not rule on the legality of revoking the plan because the construction of StarWorld did not breach the residents’ rights or interests. B u s i n es s Da i l y a p p r o a c h e d StarWorld’s operator Galaxy Entertainment Group Ltd for reaction to the appeal judgement, but no comment was available at the time we went to press. The residents’ appeal claimed the hotel-casino had blocked natural light and a ventilation corridor. This had made the residents’ flats “sombre and little-ventilated”. They purchased their flats “confident that the conditions… would not change, even because there was an urban plan that seemed to guarantee the stability of their expectations,” said the appeal. The Public Prosecutions Office said those expectations were unreasonably high “in a territory as small and as scarce of land as Macau” where land reclamation and construction were bound to occur. The prosecutions office said that if a flat with little light or ventilation was “an insult to the appellants’ health, well being, comfort and environment, the least we can conclude is that most of the Macau residents are deprived of access to such fundamental rights, which would be a real tragedy”. The judgement sides with the prosecutions office, saying data proving the flats had become sombre and little-ventilated are “lacking”.

Approval for StarWorld should not have gone ahead, says judge Ho Wai Neng (Photo: Manuel Cardoso)

Nevertheless, Judge Ho argued that an administrative decision did not have to breach an individual’s rights in order to be considered illegal. Approving StarWorld breached the NAPE urban plan and it “should be rescinded,” said the former president of the Lower and Administrative Court.

High-rise springs from low-rise ambition

he site of the StarWorld Hotel was once earmarked for a 19-storey hotel and shopping centre. In the early 1990s, the Portuguese administration had a vision for NAPE as a district of medium-density development, smaller high-rise buildings and significant amounts of public open space. The government granted a 25year lease on the StarWorld site in 1992 to Vitor Cheung Lup Kwan, now a member of the Legislative Assembly, for a premium of 200 million patacas (US$25 million). Later that year, Sociedade de Investimentos Hoteleiros Majesty (International) Lda, a company in which Mr Cheung was general manager, was named as the developer. The firm had three-and-a-half years to develop the plot. No work took place, nor was the company fined. The land was sold to a subsidiary of Galaxy Entertainment Group Ltd in 2004. The government gave its final approval to the deal two years later. StarWorld’s construction was plagued by rumours the building had structural flaws. The project’s contractor, Ho Meng Fai, was found guilty in 2009 of bribing former government secretary Ao Man Long to speed up inspections at several building sites, including StarWorld. Our sister publication Macau Business magazine reported in 2006 – shortly before StarWorld opened in October that year – that Wong Ying Fai, Galaxy’s project development general manager for the StarWorld site confirmed cracks had appeared in the road behind the property. Mr Wong told Macau Business at the time: “There is some settlement at the street level but [it] will not affect the building, which has its structure completely secure”. Mr Wong added: “This is because the streets don’t have piling that goes 40 to 60 metres deep. The construction of the building was supervised according to the plan approved by the Public Works Department. During all this time we did tests and the structure has been given careful attention. No problem was revealed,” he added. The Land, Public Works and Transport Bureau asked the Civil Engineering Laboratory of Macau to investigate but there were no technical problems found. V.Q.

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business daily April 5, 2013

macau Brought to you by

The number of Macau Pass cards on issue is now nearly 1.1 million (Photo: Manuel Cardoso)

HOSPITALITY Tapping new wells If the tourism and gambling industries are to reduce their dependence on mainland Chinese, an obvious option is to attract tourists and gamblers from elsewhere in Asia. The numbers of visitors from Hong Kong and Taiwan, our nextbiggest sources after the mainland, have been showing signs of contraction. After Hong Kong and Taiwan, our next-biggest sources of visitors are Japan and South Korea. More South Koreans visited last year, but the increase simply offset the decrease in Japanese visitors.

Mobile phones to act as MACAUpass cards By the end of this year, mobile phones could be used to pay for anything that a MACAUpass card pays for After Japan and South Korea, our nextbiggest sources of visitors are Malaysia, Thailand, Indonesia, Singapore, India and Vietnam, in that order. Together, they send us few visitors. Last year fewer than 4 percent of all visitors came from these countries. In 2008 and 2009 only 5.5 percent did. India could have the greatest potential as a source of visitors, and the numbers of Indians visiting showed some promise in years gone by. Last year, however, the number of Indian visitors was disappointing, being less that in 2010 or 2011. Other countries that had seemed to be sending us increasing numbers of visitors, such as Singapore and Indonesia, also sent fewer last year. The numbers of Malaysians visiting have been declining steadily, falling by almost 30 percent since 2008. The number of Vietnamese visitors was last year almost 80 percent below the peak it reached in 2009, but since so few Vietnamese visit, the decline did not make much difference. More Thais visited last year, but not so many as in years gone by. The data for the first two months of this year do not change these trends. The rest of Asia seems to be a dry well. J.I.D.

11.1 %

Fall in number of Indian visitors in 2012

Tony Lai

tony.lai@macaubusinessdaily.com

eople will soon be able to use their mobile phones like storedvalue cards to take the bus, park their cars and shop for groceries, according to Macau Pass SA. The issuer of MACAUpass cards aims to have the system that allows this up and running this year. Macau Pass deputy general manager David Lao told Business Daily yesterday that the company was negotiating with some of the city’s telecommunications companies about developing a SIM card for mobile phones with the functions of a MACAUpass card. “We have already developed some samples but we still need to discuss some details with the telecommunications companies,” Mr Lao said. “We hope we can launch this service within this year,” he added. “With this SIM card in a mobile, it can be used no differently from a MACAUpass card.” Mr Lao declined to say which phone companies Macau Pass was negotiating with. He also declined to say how much it would cost to introduce

the new service. Mr Lao said that making phones double as stored-value cards would eventually get easier. “This is the first phase of this project, and in the second phase we hope to do this via downloading an app rather than using a SIM card,” he said. He did not say when the second phase would begin. Mr Lao said customers would find the new service more convenient.

Better revenue Mr Lao said Macau Pass had made a “little profit” last year. “Our cards could be used in more places – like car parks – last year, so there was better revenue,” he said. He did not elaborate. Macau Pass’s results for last year will be made public later this month. The company made a profit of about 138,700 patacas (US$17,337) in 2011, having made a profit of 1.93 million patacas in 2010. Mr Lao said the number of Macau Pass cards on issue was now nearly 1.1 million, of which about

2,000 had UnionPay Co Ltd’s QuickPass function. He said his company aimed to modify 1,700 MACAUpass readers – including some 600 on buses – so people could use QuickPass. At present QuickPass works with only about 700 readers. QuickPass allows the holder of a card to use it for contactless settlement of small transactions. Mr Lao expects all UnionPay card readers in mainland China to be able to read MACAUpass cards with the QuickPass function by 2015. This month Macau Pass and Guangdong Lingnan Pass Co Ltd will launch a new stored-value card, the MACAUpass-Lingnan Pass, which will be the first such card that can be used to pay fares on public transport in Macau and 17 cities in Guangdong. “In the first batch will be around 2,000 released here, as we expect there will be quite a lot of demand from residents here,” said Mr Lao. “The mainland side will put out at least 3,000 cards.” He said the price of the card had yet to be set.

news where it matters

April 5, 2013 business daily | 5

MACAU

Legislator worries over old university campus Kwan Tsui Hang says the government should say what it is planning for the site Tony Lai

tony.lai@macaubusinessdaily.com

egislative Assembly member Kwan Tsui Hang has urged the government to make “good and reasonable” use of the Taipa campus of the University of Macau, which will become vacant this year. The university will move to its new campus on Hengqin Island in the coming academic year. In a written inquiry on Wednesday, Ms Kwan said the government should make public what plans it has for the Taipa site, which covers 54,000 square metres, because land was scarce. “Macau is facing a shortage of land and the Taipa campus of the University of Macau covers quite a large area,” she said. “Will the university return the whole campus or just part of it to the government?” she asked. Secretary for Social Affairs and Culture Cheong U said last year that the Taipa campus would be used mainly for “cultural and educational” purposes.

The university’s rector, Zhao Wei, said last year that the university would like to keep the Taipa campus, or at least part of it. Government officials have repeatedly said they have no precise plan for the campus. Ms Kwan asked whether the government would solicit the opinions of residents on the future

use of the campus. The government is expected to take possession of the new campus on Hengqin this month, once all the construction work is complete. The university said in February that it would begin trying out the new campus by June and have it operating fully in September, in time for the new academic year.

The University of Macau’s Taipa campus covers 54,000 square metres

Poor get more cash in run up to May Day

oor families are to get the equivalent of an extra month’s allowance from the government this month, starting from today. More than 5,000 households receiving regular monthly allowances from the government are entitled to receive the additional cash. The Social Welfare Bureau said in a statement yesterday that such a move was to “help the disadvantaged communities ease their livelihood pressures caused by the inflation”. The normal monthly allowance for a single individual is 3,450 patacas (US$431) and 6,360 patacas for twomember households. Families with at least eight members are entitled to 16,150 patacas. Poverty allowances are calculated based on a government index known as the minimum subsistence index. It was last adjusted in January. The supplementary payments in April will cost the government an extra 25 million patacas. The Bureau’s announcement comes just before the Labour Day holiday at the start of May. On Labour Day 2007 and again in 2010 street marches protesting at local unemployment and the importation of outside workers ended in violence and arrests. Since 2008, the Macau government has paid all the city’s registered residents an annual cash handout, usually in May. This year permanent residents are to receive 8,000 patacas – a 12.5 percent increase on 2012. The government has not yet confirmed the date of the payment. T.L.

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business daily April 5, 2013

macau Longer bus services for new border hours

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Four bus routes will serve the public for longer hours during the three-day Ching Ming Festival that started yesterday. They are meant to better suit the new opening hours of the Gongbei border, which will be open from 6 am to 1 am until tomorrow. The routes – 3, 18, 25, AP1 – will operate from 5.30 am to 1.30 am, according to a statement from the Transport Bureau. The government’s spokesperson Alexis Tam Chong Weng said on Wednesday that they had notified travel agencies, casinos and hotels to adjust the schedule of their shuttle buses.

Sex and age effects The unemployment rate is usually higher among men than among women. One reason is that women leave the labour force more often and for longer periods than men. That is, when a woman leaves her job, voluntarily or involuntarily, she is more likely than a man to stop looking for another job, and so is not counted as unemployed. The unemployment figures in Macau reflect this almost universal feature of labour markets. Look at unemployment among workers in the various age groups and you see other features. The chart shows the average number of unemployed in any one year from 2008 to 2012.

‘Case about not paying your debts’: Suen lawyer Opening gambit in renewed battle between HK businessman and LVS over credit for Macau casino licence Michael Grimes

michael.grimes@macaubusinessdaily.com

S In all but one age group the numbers of unemployed men were bigger than the numbers of unemployed women. Among workers under 25 years of age and workers aged 45 to 54, for every five unemployed women there were roughly eight unemployed men. Among workers aged 55 to 64, the ratio of unemployed women to unemployed men was even wider. However, the numbers of unemployed in this age group are small, making the ratio sensitive to small changes, and the paucity of unemployed women reflects the abandonment of the labour market by other women in this age group. Among workers aged 35 to 44, unemployed women outnumbered unemployed men mainly because so many more women were jobless in 2008 and 2009, during the slump caused by the international financial crisis. This suggests that some occupations where women are more numerous are more sensitive to the ups and downs of the economy. J.I.D. The content of this column is the work of Business Daily’s journalists.

9,165 Average number of jobless in the past five years

ome of the allegations made in a 2008 lawsuit about how Las Vegas Sands Corp. got its Macau gaming licence emerged again in opening remarks at a new civil trial about the same matter in Nevada. Opening statements started on Wednesday United States time in state court in Las Vegas. Hong Kong businessman Richard Suen claims that LVS breached a 2001 agreement to pay him and his associates US$5 million (40 million patacas) and two percent of the net income from the company’s Macau casinos if it were awarded a gaming permit there. Mr Suen is seeking as much as US$328 million in damages. The opening from Mr Suen’s legal team included a repeat of suggestions from the 2008 trial that Mr Adelson made inquiries of senior U.S. lawmakers to find out what political opposition there might be domestically to the idea of China hosting the 2008 Olympics in Beijing. John O’Malley, a lawyer for Mr Suen, told jurors that at Mr Suen’s suggestion, before meeting with the Chinese officials in July 2001, Mr Adelson telephoned Republican lawmakers to “see what he could learn” about a pending U.S. House of Representatives resolution to discourage the U.S. Olympics Committee to vote for Beijing’s bid to host the 2008 Olympics. After talking to then House Majority Whip Tom DeLay, who was a co-sponsor of the resolution, Mr Adelson told the mayor of Beijing that he didn’t have to worry about the House voting on it, Mr O’Malley said. “As a result of that call, Mr Adelson learned or understood that the bill would either be killed or not voted on” before the vote in Moscow later that same month on Beijing hosting the

Opposite sides – Richard Suen, left, and Sheldon Adelson

Olympics, Mr O’Malley said. The lawyer added that the goodwill Mr Adelson generated by calling his political connections at the time of the Olympics bid was important to Chinese officials helping Las Vegas Sands getting awarded the Macau licence.

Old news For the Chinese government and the general public, the claims – which had the potential for causing some embarrassment on this side of the world the first time around in 2008 – have probably lost most of their sting now. But a second trial means a new jury, so many of the arguments made the first time are being repeated. What appeared to be new this time was an attempt by lawyers for Mr Suen to define the case in terms of fairness rather than technical contractual duty. “This is a case about not paying your debts even if you have the

means to do so,” Mr O’Malley told jurors. “Las Vegas Sands should pay a debt that now has been owing for many, many years.” Richard Sauber, a lawyer for Las Vegas Sands, said in his opening statement that Mr Suen can’t prove his claim that he “delivered” the Macau licence by setting up a 40-minute meeting with officials in Beijing. “Mr Suen had nothing whatsoever to do with any of these activities,” Mr Sauber said. “There was no interference from China – this was an independent decision.” Mr Adelson was scheduled to testify in the latest hearing at the Nevada District Court, Clark County, on Thursday U.S. time. The Nevada Supreme Court in 2010 reversed a US$43.8 million jury award that had been made in favour of Mr Suen two years earlier in relation the matter. The court – which in Nevada acts as the appellate body – sent the case back for a new trial. With Bloomberg News

April 5, 2013 business daily | 7

MACAU

Estate agent law clears out ‘grey’ operators Profession welcomes regulation of estate agents’ qualifications, but has concerns over proposed exam’s content Stephanie Lai

sw.lai@macaubusinessdaily.com

he local property sales sector is generally positive about the new estate agent law for unifying qualification standards. Macau General Association of Real Estate and Midland Realty (Macau) Ltd agree that the law has at least cleared out the long existing ‘shady operators’ in the city. That’s people using their shops to run both a property dealership and some other unrelated business. “It just doesn’t make sense that people can run both property sales and a totally unrelated business, like selling clothes, in one single shop,” said Ronald Cheung Yat Fai, Midland Realty (Macau) Ltd managing director. “It’s good to see the real estate agent law does not allow this type of operation to go on,” Mr Cheung told Business Daily. The law on estate agents, gazetted in November but only coming into force this July, requires all local sales agents and agencies to take an exam to get a licence to operate.

is focusing on the legal knowledge of property trading. The course will only start after the law comes into force on July 1. “The exam exemption rule has at least ensured the new law will not impose a hard blow to the existing estate agents, particularly the ones more than 40-year-old,” said Chong Sio Kin, president of Macau General Association of Real Estate. “A good number of the local estate agencies are run by operators that are at least 40 years old,” said Mr Chong. “And when they started the business one or two decades ago, they did not complete a tertiary education. An exam on legal theory would be too much a test for them.”

Exam doubts

Sales agents and agencies to take an exam to get operation licence

The agents and agencies established prior to November 12 last year are being given a threeyear grace period whereby they can continue to operate prior to taking the new exam – provided they apply for a temporary licence. The new law states that agents

aged 40 years and above with at least five years of experience in property trading can be exempted from the qualification exam, as long as they attend 80 percent of an approved training course. The 30-hour training course, held by the Labour Affairs Bureau,

However, Midland’s Mr Cheung had some reservation of the content of the qualification exam. According to the government, the qualification exam for agents will be directly drawn from the questions and answers section on property trading laws published on the bureau’s website. “I find it problematic that the 500 Q & As are being directly extracted as exam content, instead of serving as a reference to candidates,” said Mr Cheung. “And I think it would be better if the bureau can provide more practical aspects of the trade in the course and the exam, like the different types of property transaction scenario and contract terms,” he added. “It’s also important that the government could issue a unified guideline on the operation mode and code of conduct for estate agents along with the training,” the agent said.

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business daily April 5, 2013

GREATER CHINA

Hopes still pinned on cheap Chinese shares Fund managers bet on turnaround in China’s equity index Sujata Rao

Equity returns – still elusive

he triumph of hope over experience. That might describe investors’ continuing infatuation with Chinese stocks despite mostly meagre rewards in the past. Though MSCI’s China index is languishing 4 percent in the red this year, many fund managers are betting the stars are finally aligned for a lasting turnaround in China’s equity index, the biggest in emerging markets. A lot of cash is riding on hopes that last year’s bumper 23 percent return

marked an end to a multi-year lossmaking run. Data from fund tracker EPFR Global shows more than US$8 billion has flowed to China equity funds this year – over a third of the amount taken by emerging market funds as whole. So why, despite years of losses, are investors so bullish? For one, growth appears to have stabilised after hitting decade-lows last year. The Communist Party’s new leaders have announced reform plans to boost domestic consumption while regulators have suspended

approvals for new IPOs to curb unbridled equity issuance. Most crucially, fund managers say, these factors are not reflected in Chinese share prices, which trade a quarter below their own past 10-year average, based on forward earnings. “We are not jumping up and down, saying we expect huge gains this year but we do expect a steady upward move,” said Jeff Chowdhry, a fund manager at F&C Investments who is “modestly overweight” Chinese shares. “We expect a gentle improvement

in economic outlook, that provides a supportive backdrop for companies to grow earnings.” But in what has become a familiar pattern, exuberance that took hold last autumn has dimmed, with the index now 8 percent off the 4-1/2year highs of early February. Recent earnings have disappointed, with Reuters Starmine data showing that over half the Hong Kong-listed Chinese firms that reported 2012 results by end-March had missed forecasts. Fears of more real estate curbs

HKEx eyes yuan commodities trade Plans to use LME ‘to achieve a breakthrough in the barrier between China and the world’, says chief executive

harles Li, the chief executive of Hong Kong Exchanges & Clearing Ltd, is taking over the 136-year-old London Metal Exchange at time when most metals and energy trading in Asia is done through contracts anchored in Europe and the U.S. Besides LME’s 80 percent share of global industrial-metals, the benchmarks for oil, West Texas Intermediate and Brent, are settled in New York and London. Global benchmarks for everything from corn to wheat to soybeans are set in Chicago. The Gansu-raised former chairman of JPMorgan Chase & Co. in China paid US$2.2 billion for the LME. At 180 times trailing income, the deal, announced on June 15 and completed on December 6, is the most expensive bourse acquisition over US$1 billion since at least 2000, according to data compiled by Bloomberg. The price was justified because the world’s second-biggest economy accounts for as much as 44 percent of global consumption of aluminium and copper, Mr Li said.

“I didn’t go to London to do this to make history,” Mr Li said in an interview. “More importantly for us is to really use the LME as a catalyst to achieve a breakthrough in the barrier between China and the rest of the world.” The Hong Kong bourse’s all-cash offer beat Intercontinental Exchange Inc. to win control of LME. CME Group Inc., which vies with Hong Kong Exchanges for the title of world’s biggest bourse company by value, had dropped out of the bidding earlier. With the LME behind it, Hong Kong plans a venue for its own products in iron ore, coking coal and crops, and will expand the LME’s network of warehouses for storing physical commodities into China, Mr Li said. That will give Hong Kong Exchanges a chance to capture the yuan-denominated commodities trade, valued at a combined 95.3 trillion yuan (US$15.35 trillion) in 2012, which is now confined to three Chinese exchanges that restrict foreigners, according to the China Futures Exchange Association. Those venues are in Shanghai, the northern

port city of Dalian and Zhengzhou, capital of Henan province. Hong Kong can provide a “demilitarised zone” where domestic consumers and foreign suppliers establish prices using indexes, futures and physical delivery contracts, Mr Li said.

Three leaders “With a strong suite of listed products consisting of equities, commodities, fixed income and currencies, I see HKEx joining CME and ICE as one of the three leading exchanges in the world in five to 10 years,” Eric Shi, global commodities head of BOC International, the investment-banking unit of Bank of China Ltd. wrote in an e-mail. “There are still many hurdles for HKEx/LME to be successful, particularly in the short term, given the complexities of China.” Mr Li said the opening of the Chinese economy echoes his own journey from growing up in a rural territory bordering Mongolia to speaking at the London LME dinner. He wants to cement

Hong Kong’s position as China’s outward-facing financial centre rooted in every asset class. “What influenced my life and the life of my generation is this great wave of change of China, in the short space of 15 years that allowed my generation to experience something that other people hadn’t

KEY POINTS HKEx wants venue for own products in iron ore, coking coal and crops Paid US$2.2 billion for the LME Plans to expand warehouses for storing commodities in China LME investment a mistake – David Webb

April 5, 2013 business daily | 9

GREATER CHINA – with a potential knock-on impact on steel, cement and banks – have also weighed. China is nevertheless still fund managers’ fifth largest overweight in emerging markets, Bank of America/ Merrill Lynch’s monthly survey finds. Net overweight positions were as high as 50 percent last month though they fell to 11 percent in March.

Bitter experience Investors’ continued keenness on China may seem surprising given their bitter past experience. Having poured over US$50 billion into Chinese equities since 1995, international funds have found out the hard way that booming growth is no guarantee of equity returns. Except for a brief 2003-2007 period and the end-year spurt in 2012, the MSCI China index has mostly lost money. But Bill Maldonado, AsiaPacific CIO for HSBC Global Asset Management, reckons the market is at a turning point as fears that have dogged it since 2008 recede, whether of an economic hard landing, leadership changes or a world growth collapse. Evidence, according to Mr

US$8 bln Has flowed to China equity funds this year according to fund tracker EPFR Global

Maldonado, will come this year via upgrades to earnings forecasts, rather than the reverse that is usually the case in China. He predicts 13-14 percent earnings growth in 2013, versus forecasts of 10-12 percent. But shares are trading well below their past average and are much cheaper than for most other emerging markets. “That’s very supportive given the relatively high level of earnings,” Mr Maldonado said. “I can buy the Chinese market on a price-book of 1.25-1.5 but experience return-onequity (ROE) in 2013 of 20 percent. Show me another market that will give me 20 percent ROE at that valuation.” As a multiple of forward earnings, MSCI China trades at 9.1 times compared to its past average of 12 times and the emerging markets average of 10.3 times, Thomson Reuters data shows. “Earnings growth has been decent in the past three years but MSCI China has moved sideways. That means Chinese companies have become more and more undervalued,” says Gustav Rhenman, a portfolio manager at East Capital in Stockholm. Take two of China’s biggest banks, Bank of China Ltd and Agricultural Bank of China Ltd. Both trade at a price-book ratio of 1 or less, well below peers in India or Russia. Versus forward earnings, BOC now trades under 6 times, from 8.6 in early 2011. Shares in both banks are down this year after they posted their worst ever annual results. Investors point out that earnings actually grew 19 percent and 12.2 percent respectively, however. In 2011, they grew 28.5 percent and 19 percent.

Still waiting

in non-traditional lending risk further policy tightening. That could fuel a surge in bad loans at banks, in turn hitting property shares. Given these risks and high levels of state ownership in the market, cheap valuations are justified, critics might say. Investors counter that current share valuations effectively pay them to take that risk. And potential rewards are great, maintains veteran investor Mark Mobius, executive chairman at Franklin Templeton’s emerging markets group. Consumers in China have been benefiting from annual wage increases of 20 percent or more, Mr Mobius notes, while the new government has made urbanisation a priority. “It’s our expectation that as disposable income increases for China’s middle class, more personal assets could be funnelled into savings and investments,” Mr Mobius told Reuters in an email. He is one of many who now hope that an era of slower growth in China will mark a shift towards more steady equity returns.

Asian time zone, of the Asian pricediscovery system, the Asian volume,” said Mr Li, who helped lead China’s first international bond sale in New York 19 years ago. “Unless you have fixed income and currency markets you are not a real capital market, you are not a real international financial centre. Our chance lies in the renminbi.” Bloomberg News

Reuters

We are not jumping up and down, saying we expect huge gains this year but we do expect a steady upward move Jeff Chowdhry, fund manager, F&C Investments

The reality is that returns are still elusive. The MSCI index is back at December 2012 lows on fears that the real estate recovery and an explosion

Management stretch

Mr Li took over as CEO in January 2010

2007, and almost 10 percent below the closing level on January 15, 2010, the day before Mr Li took charge. Mr Li’s acquisition of LME may help offset declining business from equities. Turnover dropped to HK$13.3 trillion last year, a 22 percent slump from 2011, according to data from the bourse. “The point is to create a growing relevance and importance in the

Failure means US$1.4 billion deal can be terminated ustralia’s Sundance Resources Ltd said yesterday Chinese suitor Hanlong Group had failed to make a key payment to it due this week, triggering a clause that will allow either side to terminate the troubled US$1.4 billion takeover deal as early as Monday. Sundance said it remained in “incomplete and confidential” talks with Hanlong representatives, but demanded payment of the second of three planned tranches of A$5 million (US$5.24 million) under a convertible note facility by Monday. Hanlong’s failure to pay the funds by April 3 is the latest in a series of missed deadlines by the Chinese company and follows its failure to provide proof of financing for its A$0.45 per share bid by a March 26 deadline. The deal, first announced in October 2011 as Hanlong sought access to Sundance’s US$4.7 billion Mbalam iron ore project in Africa, has also been subjected to a string of revisions and regulatory delays. Sundance shares have been suspended from trading since March 19, when Chinese media reported that Hanlong chairman Liu Han had been detained by police. Reports later said Mr Liu was under police investigation for harbouring his younger brother, a murder suspect. Sundance’s shares last traded at 21 cents of Australian dollar, less than half the value of Hanlong’s offer. Sundance said it expects the shares to remain suspended until an announcement on whether to terminate the deal. Sundance has been committed to the troubled takeover deal even after some Hanlong executives in Australia were charged with insider trading, Chinese authorities held up approvals and Hanlong cut its offer by more than a fifth. But Hanlong’s failure to pay the second tranche of agreed funding means the companies will enter into a 10 business day consultation period from Monday, during which either side can end the deal. The consultation has been delayed until next week because of the April 4-5 Chinese public holiday. The Chinese government had ordered Hanlong to line up a major Chinese company to help it develop the Mbalam project on the border of Cameroon and Republic of Congo, but those talks have stalled following the detention of Mr Liu. Investors have been betting the deal would not go ahead due to the repeated delays in securing the necessary financing from Chinese institutions.

experienced over 20, 30, 40, 50, 60 years, because of the change in China from nobody to the second-largest economy,” he said. He joined HKEx in 2009 and became CEO in January 2010. Last year, Mr Li received a cash bonus of HK$6.6 million (US$850,000) on top of his HK$7.6 million salary, according to data compiled by Bloomberg.

HKEx’s LME investment was a mistake, according to David Webb, an independent financial commentator based in Hong Kong and a former director of the exchange. “The justification for buying it, whatever the price was, was diversification and that’s never a good reason to buy something in and of itself,” Mr Webb said in a phone interview. “It’s 6,000 miles away. It doesn’t have any synergies with HKEx and it stretches management capabilities to assimilate something so different.” The bourse company’s net income fell 32 percent in the fourth quarter to HK$864 million, below analysts’ estimate and the worst since the first of quarter of 2009. The decline was due to falling volume and listings, the firm said. The share price, while gaining 6.3 percent in 2012, is about half of its peak at HK$265.60 in November

Hanlong misses Sundance payment

10 |

business daily April 5, 2013

ASIA Billabong bidders seek cheaper deal Private equity bidders for Billabong International Ltd are seeking to buy Australia’s largest surf-wear company for as little as 50 Australian cents a share, two people with knowledge of the matter said. Billabong is seeking a higher offer and talks are continuing with the groups led by Altamont Capital Partners and Sycamore Partners Management, said the people. No offer at that price has been made, a third person said. Billabong yesterday suspended its shares from trade to continue talks, giving no timetable for how long that would take. A deal at 50 cents a share would value the company at A$239 million (US$250 million).

BOJ doubles bond purchases Kuroda sets new base money target, boosts asset buying

Prices, excluding food, haven’t risen 2 percent since 1997

ank of Japan Governor Haruhiko Kuroda began his campaign to end 15 years of falling prices by doubling monthly bond purchases in a bid to reach 2 percent inflation in two years. With Mr Kuroda presiding over his first meeting, the board yesterday temporarily suspended a cap on bond holdings and dropped a limit on the maturities of debt it buys. The BOJ will purchase 7 trillion yen (US$74 billion) of bonds a month along with more risk assets, the central bank said in Tokyo. The yen fell the most since October 2011 and stocks surged, signalling Mr Kuroda is winning investors’ confidence as he targets a doubling of the monetary base over two years to revive the world’s third-biggest economy. “The previous approach of incremental easing wasn’t enough to pull Japan out of deflation and achieve 2 percent inflation in two years,” Mr Kuroda said at a news conference after the monetary policy meeting. “This time, we took all necessary steps to achieve the target,” he added. The BOJ set a two-year horizon for the price goal under a “new phase of monetary easing,” as the governor won the backing of a board mostly appointed by the previous government. “It’s fast and furious,” said Takuji Okubo, chief economist at Japan Macro Advisors in Tokyo, and formerly of Goldman Sachs Group Inc. “The

specific mention of a two-year time horizon was a positive surprise.” The Nikkei 225 Stock Average rose 2.2 percent after falling earlier and is up 45 percent from midNovember. The yen slid 2.7 percent to 95.63 per dollar at 4.45 pm in Tokyo, the largest one-day decline since October 2011.

Call rate The BOJ said it changed the target for money-market operations from the overnight call rate to the monetary base – cash in circulation and the money that financial institutions have on deposit at the central bank. It predicts the measure will grow to 270 trillion yen by the end of 2014. The average remaining maturity of government bonds to be purchased by the bank will be about seven years under the new plan, compared with less than three previously. Monthly bond purchases stood at an average of about 3.4 trillion yen in the first quarter, according to data compiled by Bloomberg. At stake is sustaining growth after three recessions in five years. The bank will increase holdings of exchange-traded funds and real-estate investment trusts, by 1 trillion yen and 30 billion yen per year respectively. The BOJ scrapped the asset-purchase programme set up by former Governor Masaaki Shirakawa that was previously its main tool for easing, and said it

will buy bonds with maturities of as much as 40 years.

Banknote rule Under a so-called banknote rule, the BOJ had pledged to keep the value of its bond holdings below the amount of cash in circulation, excluding securities held under its asset-purchase program. That guideline is “temporarily suspended,” the central bank said. Only one board member, Takahide Kiuchi, voted against any of Mr Kuroda’s policy proposals. The new policies will “lead Japan’s economy to overcome deflation that has lasted nearly 15 years,” the central bank said in the statement. “Today’s decision clearly heralds a regime change at the BOJ,” said Hiroaki Muto, a senior economist in Tokyo at Sumitomo Mitsui Asset & Management. “Kuroda has embarked on an experiment of whether boosting the monetary base can prop up economic growth and eradicate deflation.” Not everyone is confident that Mr Kuroda’s plan will work. Former BOJ board member Atsushi Mizuno last month said more bond purchases could inflate a market bubble, while Kazumasa Iwata, a former deputy governor, deemed Mr Kuroda’s twoyear goal impossible. Prices excluding fresh food haven’t risen 2 percent in any year since 1997, when a sales tax was increased. Bloomberg News/Reuters

KEY POINTS Bank of Japan changes policy target to base money from interest rates BOJ combines bond-buying schemes, targets JGBs across curve ‘We took all necessary steps to achieve the target’ – Kuroda Decisions made by unanimous vote

April 5, 2013 business daily | 11

ASIA Australia retail sales surge in Feb Australian retail sales increased by the most in three years in February, in the clearest sign yet that consumer demand is responding to lower interest rates. The Reserve Bank of Australia (RBA) held rates steady at 3 percent at its April policy meeting this week in a show of confidence that the rate cuts since November 2011 were percolating through the economy. Yesterday’s data showed retail sales surged 1.3 percent in February, far outstripping forecasts of a 0.3 percent increase. It was the largest monthly gain since November 2009 and followed an upwardly revised 1.2 percent rise in January.

N.Korea drags won to 7-month low Pyongyang warns U.S. it approved ‘lighter’ nuclear attack

ensions with North Korea dragged the South’s won currency to a seven-month low against the dollar yesterday, leading a broad decline in emerging Asian currencies after the U.S. reported weaker-than-expected private hiring in March. The Malaysian ringgit was the lone bright spot, climbing to its strongest level in two months as traders bet on the return of the ruling coalition in elections expected this month. Such a result will spark more inflows into the country’s stocks and bonds, they said. The won slid up to 0.7 percent to 1,125.7 per dollar, its weakest since September 13 on offers from offshore funds, traders said. Foreign investors sold local shares. Some traders said foreign exchange authorities may have intervened to limit the won’s downside. Exporters including shipbuilders bought the won on dips, but the currency is expected to stay under pressure from the tension on the Korean peninsula, traders and analysts said. “There were so many exporters’

The won is at its weakest against the dollar since September 13

bids around 1,125. Without such demand, the won could have gone to 1,130,” said a South Korean bank dealer in Seoul. “With market focusing on the geopolitical tension, it would be a key how further exporters’ demand persist,” the trader added. The United States said it would soon send a missile defence system to Guam to defend it from North Korea, as the U.S. military adjusts to what Defence Secretary Chuck Hagel

called a “real and clear danger” from Pyongyang. Hours later, South Korea’s Yonhap news agency said North Korea had moved what appeared to be a mid-range Musudan missile to its east coast. North Korea stepped up threats against the U.S, authorising its military to conduct a potential “smaller, lighter and diversified nuclear strike” while again restricting South Korean access to a joint industrial zone. The missile movement and the statement by the North Korean army yesterday marked a further escalation over the regime’s nuclear weapons programme and United Nations sanctions against it. The U.S. and South Korea say the rhetoric hasn’t been accompanied by actions consistent with preparations for war. Nevertheless, foreign investors continued to dump Seoul shares, unloading a net 472.3 billion won (US$422.6 million) worth of stocks on Seoul’s main exchange. On Wednesday, they sold a net 218.5 billion won in shares. The won has been the worst performing emerging Asian currency with a 4.8 percent loss against the dollar, according to Thomson Reuters data. But the South Korean currency rose 2.1 percent to 11.7552 against the yen after the Bank of Japan shocked markets with a radical overhaul of its policymaking, adopting a new balance sheet target and pledging to double its government bond holdings in two years to fight deflation. Reuters

Hyundai, Kia fall on vehicle recall Five model years recalled for electronic defects

yundai Motor Co., South Korea’s largest automaker, and its affiliate Kia Motors Corp. recalled more than 1.8 million vehicles in the U.S. and South Korea. Hyundai dropped 5.1 percent, the most since November 5, to 207,000 won (US$184) at the close in Seoul trading. Kia sank 3.3 percent, while the benchmark Kospi index fell 1.2 percent. About 1.1 million vehicles are affected by a possible malfunction that may prevent brake lights from illuminating and the cruise control from turning off, raising the risk of a crash, Hyundai said on the U.S. National Highway Traffic Safety Administration website. Kia is recalling 623,658 vehicles for the same defect. The automakers combined sold 1.26 million cars and light trucks in the U.S. last year. “The latest recall doesn’t seem to be an issue that could hurt brand image of the South Korean carmakers in the U.S.,” Im Jeong Jae, a Seoul-

based fund manager at Shinhan BNP Paribas Asset Management Co. said yesterday. “Given that the actual costs they have to cover are marginal, today’s share-price drop is excessive.” Hyundai and Kia are also recalling 160,000 vehicles in South Korea for the same stop-lamp malfunction, the companies said in separate e-mails. The malfunctioning switches cause affected electronics to not work intermittently and don’t affect brake performance, Jim Trainor, a U.S.-based spokesman for Hyundai, said in an e-mail. The recall includes Accents and Tucsons from model years 2007 to 2009, Elantras from 2007 to 2010, Santa Fes from 2007 to 2011, Veracruzes from 2008 to 2009, 2010 to 2011 Genesis Coupes and 2011 Sonatas. The Elantra is Hyundai’s best-selling car in the U.S. this year, according to Autodata Corp., an auto researcher. “We are working hard to solve the problem as quickly as possible,”

Hyundai said in an e-mailed response to Bloomberg query. Kia’s recall includes Rondos and Sportages from model years 2007 to 2010, Sorentos from 2007 to 2011, Sedonas from 2007, Souls from 2010 to 2011 and Optimas from 2011. The stop-lamp defect can also lead to intermittent operation of the push-button start, prevent the gear shifter from being moved out of the park position, or cause the electronic stability control malfunction light to illuminate, according to the NHTSA filings. The vehicles included in the latest recall were built after a previous Hyundai recall for stop-lamp switch replacement, the company said in a March 29 letter to NHTSA. The company, in the letter, told regulators it changed its production process since the 2009 recall and that the cars and trucks in the new recall were manufactured before all the changes were made. Bloomberg News

Govt to sell shares in Coal India Finance ministry plans to raise US$3.7 billion

ndia plans to raise 200 billion rupees (US$3.7 billion) selling part of its stake in Coal India Ltd, the world’s biggest producer of the fuel, and narrow the widest budget deficit among major emerging economies. The government, which owns 90 percent in the monopoly coal miner, plans to sell a 5 percent stake to the public and a similar holding to the company, according to a finance ministry’s draft proposal obtained by Bloomberg News. Prime Minister Manmohan Singh’s administration sold stakes in companies including NTPC Ltd, NMDC Ltd and Oil India Ltd for about 240 billion rupees in the year ended March 31 to shrink the deficit, pay for subsidies and invest in public works. Coal India shares had their biggest gain in almost a year. The disinvestment department has asked the coal ministry to take the company’s workers’ unions into confidence and gather support for the share sale, according to the document. The unions were assured at the time of the company’s initial public offering in 2010 by the then finance minister Pranab Mukherjee there would be no further disinvestment. “We anticipate some labour issues and we will do our best to take them into confidence,” Coal Secretary S.K. Srivastava said in an interview. The divestment list to raise 400 billion rupees this fiscal year includes National Aluminium Co., Rashtriya Ispat Nigam Ltd, Indian Oil Corp., Power Grid Corp. of India, Bharat Heavy Electricals Ltd and Coal India. Bloomberg News

We anticipate some labour issues and we will do our best to take them into confidence S.K. Srivastava, Coal Secretary

12 |

business daily April 5, 2013

MARKETS Hang SENG INDEX NAME

NAME

PRICE

DAY %

VOLUME

AIA GROUP LTD

34.4

0.7320644

20416665

CHINA UNICOM HON

ALUMINUM CORP-H

2.95

-0.6734007

15061209

CITIC PACIFIC

BANK OF CHINA-H

3.56

-0.280112

295182414

5.8

0.3460208

26322048

31.15

2177664

BANK OF COMMUN-H BANK EAST ASIA

CLP HLDGS LTD

PRICE

DAY %

VOLUME

10.24

0.3921569

24004653

9.85

-0.8056395

6855961

68.8

0.5113221

3198099

CNOOC LTD

14.94

-0.928382

31282078

COSCO PAC LTD

11.12

-0.8912656

NAME POWER ASSETS HOL SANDS CHINA LTD

PRICE

DAY %

74.55

1.153324

VOLUME 2256827

39.5

-1.002506

11579669 5397716

SINO LAND CO

13.32

-0.5970149

SUN HUNG KAI PRO

105.6

-0.7518797

5129306

4920629

SWIRE PACIFIC-A

98.35

-0.8568548

1126334 4366723

BELLE INTERNATIO

12.5

-2.037618

24044880

9.51

0.955414

5382302

TENCENT HOLDINGS

242.8

BOC HONG KONG HO

25.9

-0.1926782

8082826

HANG LUNG PROPER

30.15

1.174497

6249895

TINGYI HLDG CO

20.25

-2.409639

2278084

CATHAY PAC AIR

12.8

-1.990812

6081294

HANG SENG BK

125.5

0.3197442

1344690

WANT WANT CHINA

11.88

1.192504

7930395

114.6

-0.6932409

2989128

HENDERSON LAND D

54.05

0.371402

3147034

WHARF HLDG

70.3

-0.6360424

6140496

6.69

-1.762115

16785755

0.456621

1206868

CHEUNG KONG CHINA COAL ENE-H CHINA CONST BA-H

6.3

-0.4739336

176445858

CHINA LIFE INS-H

20.05

-0.2487562

32293971

CHINA MERCHANT

25.05

0.804829

ESPRIT HLDGS

HENGAN INTL HONG KG CHINA GS

0.4366812

4616267

HONG KONG EXCHNG

131.7

-0.3028009

2546009

2499943

HSBC HLDGS PLC

82.95 -0.06024096

5417698

8948748

HUTCHISON WHAMPO

CHINA MOBILE

82.7 -0.06042296

CHINA OVERSEAS

21.6

19645036

IND & COMM BK-H

CHINA PETROLEU-H

9.07

-0.4390779

44368855

0.3671971

4715017

5.34

-0.5586592

246566066

LI & FUNG LTD

10.56

-0.5649718

14118324

0.8064516

1745859

CHINA RES ENTERP

23.6

1.724138

3316097

MTR CORP

31.25

CHINA RES LAND

21.9

-0.2277904

3434301

NEW WORLD DEV

13.24

10127513

CHINA RES POWER

23.5

-0.6342495

9418336

PETROCHINA CO-H

10.28

33339720

CHINA SHENHUA-H

28.15

-0.177305

12206269

PING AN INSURA-H

59.75 -0.08361204

7944325

MOVERS

5 22530

INDEX 22337.49 HIGH

22527.12

LOW

22153.89

52W (H) 23944.74 22150

(L) 18056.4 28-March

3-April

Hang SENG CHINA ENTErPRISE INDEX NAME

PRICE

DAY %

VOLUME

25.65

0.984252

8776704

CHINA PETROLEU-H

9.07

-0.4390779

15061209

CHINA RAIL CN-H

6.95

1.750973

9226560

CHINA RAIL GR-H

3.56

-0.280112

295182414

CHINA SHENHUA-H CHINA TELECOM-H

PRICE

DAY %

VOLUME

AGRICULTURAL-H

3.6

-1.369863

196658116

AIR CHINA LTD-H

6.71

-0.739645

12918000

ALUMINUM CORP-H

2.95

-0.6734007

ANHUI CONCH-H

26.15

BANK OF CHINA-H

NAME CHINA PACIFIC-H

PRICE

DAY %

VOLUME

YANZHOU COAL-H

10.2

-0.5847953

13242353

44368855

ZIJIN MINING-H

2.51

-1.953125

57523023

-0.286944

11949263

ZOOMLION HEAVY-H

8.23

-2.372479

30155711

3.74

-1.058201

18568669

ZTE CORP-H

12.34

-3.139717

9301311

28.15

-0.177305

12206269

5.8

0.3460208

26322048

3.9

33644813

BYD CO LTD-H

23.4

-3.703704

1759174

DONGFENG MOTOR-H

10.92

0.1834862

10778440

CHINA CITIC BK-H

4.22

-3.652968

108594093

GUANGZHOU AUTO-H

6.15

-3.149606

9383178

CHINA COAL ENE-H

6.69

-1.762115

16785755

HUANENG POWER-H

8.4

0.3584229

16118030

CHINA COM CONS-H

7.25

1.11576

37609504

IND & COMM BK-H

5.34

-0.5586592

246566066

CHINA CONST BA-H

6.3

-0.4739336

176445858

JIANGXI COPPER-H

16.62

-1.071429

10295497

CHINA COSCO HO-H

3.51

-0.2840909

14063522

PETROCHINA CO-H

10.28

33339720

20.05

-0.2487562

32293971

PICC PROPERTY &

9.58

-2.244898

26252362

CHINA LONGYUAN-H

6.95

0.1440922

11790805

PING AN INSURA-H

59.75

-0.08361204

7944325

CHINA MERCH BK-H

15.8

-1.741294

39833137

SHANDONG WEIG-H

7.14

0.2808989

7674000

BANK OF COMMUN-H

CHINA LIFE INS-H

CHINA MINSHENG-H

9.28

-2.109705

56474349

SINOPHARM-H

25.05

0.6024096

7454957

CHINA NATL BDG-H

9.5

-1.758014

45476691

TSINGTAO BREW-H

48.3

-2.12766

1040407

16.32

-1.090909

6142347

WEICHAI POWER-H

25.05

-0.1992032

4891372

CHINA OILFIELD-H

NAME

MOVERS

3 10980

INDEX 10758.8 HIGH

10973.38

LOW

10728.6

52W (H) 12354.22 10720

(L) 8987.76 28-March

3-April

Shanghai Shenzhen CSI 300 PRICE

DAY %

VOLUME

PRICE

DAY %

VOLUME

AGRICULTURAL-A

2.73

1.486989

129304479

CHONGQING CHAN-A

9.12

-5

35425387

AIR CHINA LTD-A

5.33

-2.380952

14837358

CHONGQING WATE-A

6.25

-1.263823

8323514

ALUMINUM CORP-A

4.11

1.231527

16410036

CITIC SECURITI-A

12.12

-1.383238

ANHUI CONCH-A

17.97

0.05567929

20414462

CSR CORP LTD -A

3.98

BANK OF BEIJIN-A

8.78

0.5727377

12519265

DAQIN RAILWAY -A

7.43

BANK OF CHINA-A

2.94

0.3412969

23831098

DATANG INTL PO-A

BANK OF COMMUN-A

4.73

0.4246285

41895734

EVERBRIG SEC -A

BANK OF NINGBO-A

10.65

0.6616257

9138285

GD MIDEA HOLDI-A

12.22

BAOSHAN IRON & S

4.85

0.4140787

33338202

GD POWER DEVEL-A

NAME

BYD CO LTD -A

21.73

0.1382488

NAME

2024918

GF SECURITIES-A GREE ELECTRIC

NAME

PRICE

DAY %

VOLUME

14.7

0.5471956

16194456

SANY HEAVY INDUS

10.23

0.2941176

18420786

64213558

SHANDONG DONG-A

49.6

-0.7007007

4586254

-0.2506266

32784742

SHANDONG GOLD-MI

32.13

4503942

1.226158

20445373

SHANG PHARM -A

13.06

3.322785

36419665

4.32

-1.818182

5499634

SHANG PUDONG-A

10.06

0.2991027

88765772

12.95

0.3875969

9269024

SHANGHAI ELECT-A

3.9

-0.2557545

2786662

9.990999

3768754

SHANXI LU'AN -A

17.19

0.2917153

11223085

SAIC MOTOR-A

2.96

0.6802721

34283700

SHANXI XISHAN-A

11.53

0.6108202

7962881

13.35

-0.2987304

21551785

SHENZEN OVERSE-A

5.87

-1.011804

29163533

28.7

-0.173913

10300438

SICHUAN KELUN-A

61.12

0.01636393

858950

20.01

-2.722411

29473178

SUNING COMMERC-A

6.19

-0.1612903

25218479 3638694

CHINA AVIC AVI-A

22.63

-0.745614

3247511

CHINA CITIC BK-A

4.37

-2.455357

63815792

GUANGHUI ENERG-A

CHINA CNR CORP-A

3.93

0.7692308

38332434

HAITONG SECURI-A

10.1

-1.463415

69175272

TASLY PHARMAC-A

65.75

-1.836369

HANGZHOU HIKVI-A

37.15

-0.6684492

4188126

TSINGTAO BREW-A

36.53

-2.819899

1575155

72.6

-5.714286

7334419

WEICHAI POWER-A

20.9

0.1917546

5519787 13639640

CHINA COAL ENE-A

7.11

0.4237288

5634717

CHINA CONST BA-A

4.67

0.6465517

38530656

CHINA COSCO HO-A

3.51

0.862069

24124045

HONG YUAN SEC-A

17.57

-1.458216

8669357

WULIANGYE YIBIN

21.95

-0.3178928

CHINA EAST AIR-A

3.1

-2.208202

23609850

HUATAI SECURIT-A

9.61

-0.4145078

23949469

YANGQUAN COAL -A

13.58

-0.4398827

5506977

CHINA EVERBRIG-A

3.13

50349328

HUAXIA BANK CO

10.4

0.8729389

23497537

YANTAI WANHUA-A

17.99

1.010668

10355505 5094150

HENAN SHUAN-A

12.6

-0.3952569

5133299

IND & COMM BK-A

4.09

0.7389163

49636363

YANZHOU COAL-A

16.85

-1.23095

CHINA LIFE INS-A

17.42

1.515152

14523761

INDUSTRIAL BAN-A

17.15

1.780415

99152211

YUNNAN BAIYAO-A

80.83

-1.426829

2017476

CHINA MERCH BK-A

12.79

1.83121

63290889

INNER MONG BAO-A

28.99

-0.4464286

13498865

ZHONGJIN GOLD

13.77

-1.077586

11145127

CHINA MERCHANT-A

12.28

-1.76

21352477

INNER MONG YIL-A

30.18

-0.5273566

11270966

ZIJIN MINING-A

36541275

10181936

INNER MONGOLIA-A

5.19

-0.7648184

142233487

30.89

-1.655524

6730243

CHINA INTL MAR-A

CHINA MERCHANT-A

25.1

-1.761252

CHINA MINSHENG-A

9.68

0.5192108

135990061

JIANGSU HENGRU-A

CHINA NATIONAL-A

8.86

-3.485839

34247873

JIANGSU YANGHE-A

61.05

-0.245098

2894117

CHINA OILFIELD-A

16.59

-0.1204094

2510860

JIANGXI COPPER-A

22.12

1.189387

8946948

CHINA PACIFIC-A

18.64

2.025178

18570316

JINDUICHENG -A

11.33

0.1768347

4857197

16.86

-0.9400705

18974156

163.85

0.08551707

2199050

CHINA PETROLEU-A

7.24

-0.137931

27229602

KANGMEI PHARMA-A

CHINA RAILWAY-A

4.95

13685747

KWEICHOW MOUTA-A

CHINA RAILWAY-A

2.79

0.7220217

24308391

LUZHOU LAOJIAO-A

25.88

1.490196

11226142

METALLURGICAL-A

2.04

-0.4878049

12303197 11116551

CHINA RESOURCE-A

29.85

-0.8964143

4263664

CHINA SHENHUA-A

21.85

0.6912442

8730223

NINGBO PORT CO-A

2.46

-0.8064516

8.72

-0.1145475

3.4

-0.5847953

ZOOMLION HEAVY-A

8.24

0.4878049

37953545

ZTE CORP-A

11.1

-1.245552

19203422

MOVERS 107

171

22 2530

INDEX 2483.547

CHINA SHIPBUIL-A

4.98

0.2012072

19347894

PETROCHINA CO-A

9345109

HIGH

2520.92

CHINA SOUTHERN-A

3.53

-3.287671

38771793

PING AN BANK-A

20.45

0.04892368

22458964

LOW

2476.97

CHINA STATE -A

3.39

-0.2941176

49982376

PING AN INSURA-A

40.76

0.5674809

20246771

CHINA UNITED-A

3.66

2.234637

184791701

POLY REAL ESTA-A

11.84

-1.251043

34024322

CHINA VANKE CO-A

11.2

53910464

QINGDAO HAIER-A

12.95

-0.7662835

5816462

CHINA YANGTZE-A

7.33

-0.9459459

10399853

QINGHAI SALT-A

29.31

0.9993108

10685941

PRICE DAY %

Volume

PRICE DAY %

Volume

71.1 -0.5594406

2755791

TAIWAN MOBILE CO

102

-1.923077

82 -0.6060606

4162208

TPK HOLDING CO L

609

1.162791

2938290

100.5

26347381

52W (H) 2791.303 (L) 2102.135

2470

1-April

3-April

FTSE TAIWAN 50 INDEX NAME

NAME

ACER INC

25.85

0.5836576

4907457

FORMOSA PLASTIC

ADVANCED SEMICON

24.55

0.2040816

6154521

FOXCONN TECHNOLO

ASIA CEMENT CORP

36.5 -0.4092769

2169546

FUBON FINANCIAL

40.9

ASUSTEK COMPUTER

349.5 -0.1428571

AU OPTRONICS COR CATCHER TECH

13.2

NAME

PRICE DAY %

0.122399

21772481

TSMC UNI-PRESIDENT

1727415

HON HAI PRECISIO

83.1

16366062

0.7633588

34544443

HOTAI MOTOR CO

247

1.229508

231470

UNITED MICROELEC

Volume 3011385

8775565

11.3

0.4444444

31841897

144

2.491103

15452208

HTC CORP

246.5

1.440329

7821108

WISTRON CORP

33.15

0.1510574

6480167

CATHAY FINANCIAL

40.15

0.879397

20209792

HUA NAN FINANCIA

17.3

0.5813953

4777116

YUANTA FINANCIAL

15.05

1.346801

12330618

CHANG HWA BANK

17.4

0.2881844

6482723

LARGAN PRECISION

778

1.965924

830535

YULON MOTOR CO

52.8

1.34357

3907452

CHENG SHIN RUBBE

92.8

3.571429

12490376

LITE-ON TECHNOLO

3.343465

12855541

CHIMEI INNOLUX C

18.85

0.802139

48074435

MEDIATEK INC

356

2.298851

12160599

CHINA DEVELOPMEN

8.56

1.542112

43505757

MEGA FINANCIAL H

24.15

0.8350731

20010072

CHINA STEEL CORP

26.1 -0.1912046

16017020

NAN YA PLASTICS

52.8

-1.675978

3129690

3.089888

93505585

PRESIDENT CHAIN

169.5

0.8928571

922623

CHINATRUST FINAN

18.35

CHUNGHWA TELECOM

93.1

4429687

QUANTA COMPUTER

64.5

-1.225115

8660148

COMPAL ELECTRON

21.2

0.2364066

7592825

SILICONWARE PREC

0.1472754

3101669

DELTA ELECT INC

130.5

4417418

SINOPAC FINANCIA

14.7

2.797203

114631536

FAR EASTERN NEW

30.85 -0.1618123

4129244

SYNNEX TECH INTL

53.8 -0.5545287

4940472

FAR EASTONE TELE

68 -0.8746356

5564175

TAIWAN CEMENT

38.4

1.453104

4703491

FIRST FINANCIAL

18.65

0.2688172

7807238

TAIWAN COOPERATI

0.2949853

4661149

FORMOSA CHEM & F

68.8

-2.272727

3981534

TAIWAN FERTILIZE

0.9817672

1597480

FORMOSA PETROCHE

78.7

-1.130653

1258744

TAIWAN GLASS IND

28.3

1.071429

582385

MOVERS

5 5520

INDEX 5512.96 HIGH

5514.41

LOW

5476.85

52W (H) 5639.93 5470

(L) 4719.96 1-April

3-April

April 5, 2013 business daily | 13

MARKETS GAMING STOCKS - DAILY PERFORMANCE (Hong Kong Stock Exchange) 59.3

32.80 32.65

17.20 17.05

59.2

32.50

16.90 59.1

32.35

Max 32.8

average 32.385

Max 40.3

average 39.483

Min 32.25

32.20

Last 32.35

Min 39.2

Max 59.2

average 59.195

PRICE

Max 17.04

average 16.851

Min 16.66

Last 16.66

40.1

19.6

21.0

39.8

19.4

20.8

39.5

19.2

20.6

Max 19.8

average 19.325

DAY %

YTD %

(H) 52W

(L) 52W

96.83

-0.370398227

3.939458995

106.5

BRENT CRUDE FUTR May13

110.36

-0.298129912

1.742417258

117.4300003

91.54999542

GASOLINE RBOB FUT May13

304.24

0.052617732

5.127850726

330.369997

237.7199888

GAS OIL FUT (ICE) May13

930.75

-0.18766756

1.638001638

1000.75

801.25

3.982

0.327538423

15.32001158

4.12100029

3.072000027

308.42

-0.103647082

1.997486606

327.1399975

258.5000038

1571.14

-1.6636

-5.6066

1796.08

1527.21

NATURAL GAS FUTR May13 HEATING OIL FUTR May13 Gold Spot $/Oz Silver Spot $/Oz

27.125

-2.9951

-9.9136

35.365

26.1513

Platinum Spot $/Oz

1566.9

-1.4652

3.2383

1742.8

1379.05

Palladium Spot $/Oz

761.93

-1.623

8.9

786.5

553.75

LME ALUMINUM 3MO ($)

1884

-1.050420168

-9.117221418

2200.199951

1827.25

LME COPPER 3MO ($)

7465

-0.99469496

-5.87567772

8702.75

7219.5

LME ZINC

1854

-2.266736953

-10.86538462

2230

1745 15236

3MO ($)

LME NICKEL 3MO ($) AGRICULTURE ROUGH RICE (CBOT) May13

16380

-1.680672269

-3.985932005

18920

15.925

1.014906438

2.841459477

16.95000076

14.5

640

-0.078064012

-8.604069975

838

520.25

May13

676.5

0.857249348

-14.12250079

938

659.75

SOYBEAN FUTURE May13

WHEAT FUTURE(CBT) May13

1388.25

-0.412482066

-0.78613543

1639.5

1218.75

COFFEE 'C' FUTURE May13

136.05

-0.073448402

-7.259713701

204.5999908

132.0500031

Min 19.06

Last 19.46

19.0

Max 21.05

average 20.831

Min 20.45

Last 20.8

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

PRICE

DAY %

1.0465 1.5103 0.95 1.2812 93.52 7.9949 7.7621 6.2014 54.3575 29.35 1.2382 29.858 40.895 9750 97.868 1.21715 0.84833 7.948 10.2439 119.81 1.03

YTD %

-0.0668 -0.5989 -0.3789 -0.1792 -0.2246 0.0063 0.0052 -0.029 -0.1632 0.0681 -0.0485 0.067 -0.0245 -0.1128 -0.1614 -0.2038 -0.422 0.1132 0.1816 -0.0417 0

(H) 52W

0.8383 -6.6333 -3.6421 -2.8658 -7.9341 -0.1463 -0.1482 0.4709 1.1728 4.1908 -1.3568 -2.7631 0.269 0.441 -8.7271 -0.7945 -3.8794 3.3908 2.7968 -5.2082 -0.0097

1.0625 1.6381 0.9972 1.3711 96.71 8.0039 7.7713 6.3964 57.3275 32 1.2971 30.203 43.975 9904 99.978 1.25692 0.88151 8.4957 10.9254 127.71 1.0314

0.9582 1.4832 0.9017 1.2043 77.13 7.9824 7.7498 6.1974 50.865 29.08 1.2152 28.913 40.54 9095 74.482 1.19995 0.77553 7.7018 9.6245 94.12 1.029

MACAU RELATED STOCKS NAME

(H) 52W

(L) 52W

3.67

0.273224

16.50793

3.94

2.29

4167927

CROWN LTD

12.44

0.8103728

16.58857

12.59

8.06

1534360

ARISTOCRAT LEISU

PRICE

DAY % YTD %

VOLUME CRNCY

SUGAR #11 (WORLD) May13

17.65

0.341102899

-9.948979592

24.56999969

17.5

AMAX HOLDINGS LT

0.045

#N/A N/A

13645500

89.37

0.562619557

17.80912207

93.93000031

68.18999481

BOC HONG KONG HO

25.9

-0.1926782

7.468878

27.1

20.85

8082826 132000

CENTURY LEGEND

World Stock MarketS - Indices

0.275

-5.172414

3.773591

0.42

0.215

CHEUK NANG HLDGS

5.84

0.5163511

-2.50417

6.74

2.8

18000

CHINA OVERSEAS

21.6

-6.493508

25.6

14.624

19645036

CHINESE ESTATES

COUNTRY

PRICE

DAY %

YTD %

DOW JONES INDUS. AVG

14662.01

0.6118227

NASDAQ COMPOSITE INDEX

3254.862

0.484352

FTSE 100 INDEX

6472.66

DAX INDEX

7938.51

-0.1536098

7.177439

13.08

7.697

250000

CHOW TAI FOOK JE

10.6

-1.119403

-14.79099

13.4

8.4

3491200

EMPEROR ENTERTAI

2.3

-1.709402

21.69312

2.49

1.1

380000

FUTURE BRIGHT

2.4

3.896104

96.72131

2.75

0.64

3030000

(H) 52W

(L) 52W

11.88838

14684.49

12035.08984

GALAXY ENTERTAIN

32.35

-0.154321

6.589784

35.7

16.94

4879817

7.794248

3270.296875

2726.68

HANG SENG BK

125.5

0.3197442

5.728731

131.5

99.2

1344690

-0.2773216

9.74684

6533.99

5229.76

HOPEWELL HLDGS

31.75

1.275917

-4.511278

35.3

19.049

1045958

-0.06747341

4.284063

8074.47

5914.43

HSBC HLDGS PLC

82.95

-0.06024096

2.029516

88.45

59.8

5417698

HUTCHISON TELE H

3.81

-0.2617801

7.022474

4.05

2.98

4877000

LUK FOOK HLDGS I

23.4

-4.684318

-4.098359

30.05

14.7

2312382

NIKKEI 225

12362.2

HANG SENG INDEX

22337.49

-0.1355966

-1.409855

23944.74

18056.4

MELCO INTL DEVEL

13.52

2.424242

50.05549

13.96

5.12

10922078

CSI 300 INDEX

2483.547

-0.1143827

-1.561852

2791.303

2102.135

MGM CHINA HOLDIN

16.66

0.1201923

25.46806

18.449

9.509

5424000

TAIWAN TAIEX INDEX

7942.35

0.3686255

3.154102

8089.21

6857.35

MIDLAND HOLDINGS

3.4

-0.2932551

-8.108109

3.249

2578000

NEPTUNE GROUP

0.144

-2.702703

-5.263155

0.226

0.084

9760000

NEW WORLD DEV

13.24

10.14975

15.12

7.95

10127513 11579669

KOSPI INDEX

S&P/ASX 200 INDEX

1983.22

2.988896

-0.1475216

18.92243

-0.6925254

12650.26

2051.8

8238.96

1758.99

4957.68

-0.5582177

6.640854

5163.5

3985

4975.528

0.3686922

15.26265

4985.852

3635.283

FTSE Bursa Malaysia KLCI

1678.84

-0.3655786

-0.5985959

1699.68

JAKARTA COMPOSITE INDEX

20.4

(L) 52W

COTTON NO.2 FUTR May13

NAME

16.60

21.2

WTI CRUDE FUTURE May13

CORN FUTURE

59.0

CURRENCY EXCHANGE RATES

NAME

METALS

Last 59.2

19.8

Commodities ENERGY

Min 59.1

40.4

39.2

Last 39.5

16.75

SANDS CHINA LTD

39.5

-1.002506

16.34757

41.05

20.65

SHUN HO RESOURCE

1.46

-1.351351

4.285716

1.67

1.03

30000

1526.6

SHUN TAK HOLDING

4.11

-1.201923

-1.909309

4.65

2.56

2705750

NZX ALL INDEX

940.139

0.1511633

6.585319

944.123

755.149

SJM HOLDINGS LTD

19.46

0.2059732

8.111111

22.15

12.34

5188523

PHILIPPINES ALL SHARE IX

4233.33

0.8954278

14.44588

4290.5

3238.77

SMARTONE TELECOM

13.36

1.984733

-5.113636

17.38

12.5

1955500

HSBC Dragon 300 Index Singapor

645.68

0.48

3.96

STOCK EXCH OF THAI INDEX

1542.87

-0.4946664

10.84393

1601.34

1099.15

HO CHI MINH STOCK INDEX

505.93

-0.6870424

22.28506

514.1

372.39

BOC HONG KONG HO

Laos Composite Index

1394.78

0.5863051

14.81844

1455.82

973.8

GALAXY ENTERTAIN INTL GAME TECH JONES LANG LASAL

WYNN MACAU LTD

20.8

1.216545

-0.7159941

25.5

14.62

25960609

ASIA ENTERTAINME

4.34

0.9302326

41.83007

6.8

2.4

133082

BALLY TECHNOLOGI

51.73

0.329713

15.70119

52.7

41.74

459370

3.3

7.491859

3.59

2.7

15630

4.23

0.7142857

6.549118

4.57

2.25

350

16.47

0.1215805

16.23147

17.49

10.92

5118342

97.53

-0.3168438

16.19013

100.86

61.39

212636

-0.650289

19.15078

58.3216

32.6127

4893175

MELCO CROWN-ADR

23.01

-0.04344049

36.63895

23.39

9.13

7165598

MGM CHINA HOLDIN

2.19

18.37838

2.44

1.36

500

MGM RESORTS INTE

12.48

-2.652106

7.216492

14.11

8.83

13265697

SHFL ENTERTAINME

15.76

-1.005025

8.689655

18.77

11.75

329433

SJM HOLDINGS LTD

2.54

2.419355

9.956713

2.85

1.65

1500

123.26

0.05682279

9.574186

129.6589

84.4902

1012427

LAS VEGAS SANDS

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

WYNN RESORTS LTD

AUD HKD

USD

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business daily April 5, 2013

Opinion

It would be a mistake to delay actions investors know the BOJ should have taken 10 years ago

Is Haruhiko Kuroda Japan’s Mario Draghi?

can deliver on its rhetoric. It should worry Kuroda that his vow to do “whatever it takes” to end deflation is already being questioned in financial circles.

Radical thinking

William Pesek

Bloomberg View columnist

s Haruhiko Kuroda walked into his first policy meeting as Bank of Japan governor, he must be in a Mario Draghi state of mind. Think of Kuroda’s predecessor, Masaaki Shirakawa, as Japan’s equivalent of former European Central Bank President Jean-Claude Trichet. Shirakawa was a respected economist whose doctrinaire ways caused him to stumble when unexpected things happened, such as the financial crisis in 2008. Just as Trichet’s worldview was out of sync with the times (he actually raised interest rates in mid-2008), Shirakawa was too blinded by ideology to see economic reality. When Draghi replaced Trichet in late 2011, he acted immediately to communicate that the ECB was under new management, in word and in deed. So must Kuroda, who made his debut as head of the BOJ this week. To get in touch with his inner Draghi, Kuroda should focus on this single figure: 51 percent. That, according to Standard & Poor’s, is how much the BOJ has expanded its balance sheet since September 2008. It’s a pitiful increase that’s dwarfed by the 333 percent surge in the Bank of England’s holdings, the 253 percent

jump in the Federal Reserve’s and 82 percent rise in the ECB’s. How will we know if Kuroda is a genuine deflation fighter or the latest in a long line of timid BOJ leaders? Kuroda can announce his authority and buttress his maverick bona fides at his news conference this week with a simple step: scrap the self-imposed limit on the central bank’s holdings of government bonds.

Cheering markets There’s a lot Kuroda could do to cheer markets. He should emulate Fed Chairman Ben Bernanke’s Operation Twist, vastly extending the maturity of the BOJ’s government bond holdings. He should load up on riskier assets such as corporate debt, asset-backed securities, exchange-traded funds and even equities. He should leave the door open to buy government bonds denominated in foreign currencies. And if the end of monetising some Japanese debt justifies the means, why rule it out? Yet nothing would declare that the BOJ is under new and bold leadership more clearly than dropping the so-called bank-note rule that says its government debt holdings can’t exceed the value of all yen in

circulation. That simple gesture would indicate that the Kuroda BOJ will be a vastly different central bank than the third-largest economy has had in more than a decade. “If the BOJ is to implement quantitative and qualitative easing that is to be effective in overturning the public’s deflation expectations, it will have to venture much further out of its comfort zone in terms of the assets that it buys,” said Paul Sheard, chief global economist at S&P’s in New York. Ending deflation is a confidence game, and it’s vital for Kuroda to instil some. We have heard lots of chatter from Kuroda in the two weeks since he took the helm. And that’s fine. He believes in transparency and communication as monetary tools in their own right. Like the heads of the Fed, ECB and Bank of England, Kuroda understands that so-called open-mouth operations are as vital to managing inflation expectations as open-market ones. Yet markets are sending Kuroda a clear message of their own. The cost of bearish options on Japanese shares is now at an eight-month high, according to Bloomberg News reports. In other words, investors who jumped into Japanese stocks in recent months doubt that the BOJ

It would be a mistake to delay actions investors know the BOJ should have taken 10 years ago. That means frontloading additional monetary stimulus, laying out a variety of other options and then letting traders fuel the momentum. Things would be helped along by serving up a couple of worst-case scenarios if fresh liquidity doesn’t gain traction – underwriting distressed Japanese towns, punishing banks that hoard debt to avoid making loans or whatever else Kuroda can come up with. This is the time for creative and radical thinking, not the usual ineffective remedies. Kuroda also needs to use his bully pulpit to urge the government to do its part. Economists such as Stephen Roach of Yale University and former BOJ Deputy Governor Kazumasa Iwata aren’t being cynical when they doubt Kuroda’s chances of meeting the BOJ’s 2 percent inflation target. Prime Minister Shinzo Abe must match BOJ action with equally aggressive structural changes and pro-growth strategies to generate true confidence on the part of households, companies and investors. The worst thing Kuroda could do is sound like a typical central banker, and that gets us back to Draghi. No one is saying the ECB chief has been state of the art, but the mood swing from Trichet’s tenure to Draghi’s did as much as anything to avoid disaster in Europe. It’s up to Kuroda to channel a similar shift in Japan. There’s no time to waste. Bloomberg View

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 5, 2013 business daily | 15

OPINION Business

wires Leading reports from Asia’s best business newspapers

China Daily China’s State Council on Wednesday rolled out its first major reform in agriculture since inauguration, experimenting schemes to accelerate modern agriculture. Regions where conditions allow it will be picked to carry out the pilot programme involving nine major tasks to boost modern agriculturethroughcomprehensive and coordinated agricultural reforms. The experiments in agriculture are restricted to Heilongjiang province, one of the country’s top grain production regions in northeast China, according to the statement. The government has also pledged deeper reforms in rural land management system to speed up the transfer of rural land to improve efficiency and promote large-scale commercial farming.

The Star Malayan Banking Bhd (Maybank) aims to grow its retail small and medium enterprise (SME) market share to 20 percent in five years time, said deputy president and head of community financial services Datuk Lim Hong Tat. Maybank’s current market share for the retail SME segment is estimated to be 13 percent, while its market share for the overall SME segment is about 60 percent. Aiming to grow the retail SME segment, Maybank has embarked on a transformation programme two years ago to develop a customer friendly and “lean” operating model.

Bangkok Post Thai stocks plunged 1.9 percent this week, underperforming their regional peers, on anxiety over potential measures to curb lending after the central bank expressed concern about surging property and equities trade. The property sector is at the centre of the selling spree, with the sector index slumping 5.3 percent, while some bluechip banks also suffered in the sell-off. Heightened political uncertainty also took a toll on the market. The National Anti-Corruption Commission is set to decide Prime Minister Yingluck Shinawatra’s fate for allegedly submitting a false assets declaration involving a 30-million-baht (US$1.02 million) loan to a company linked to her husband.

Jakarta Globe Indonesia plans to raise US$500 million from selling dollardenominated bonds by the end of the second quarter this year, the first such sale this year, as the government tries to plug up its huge budget deficit. Acting director general of the Finance Ministry’s debt management office, Robert Pakpahan, said the bond sale would be “benchmark size,” which is typically at least US$500 million. “It could be more or less, it will depend on the market,” Mr Robert said on Wednesday. Government officials are said to have held talks with American and European investors over the past three weeks.

The meaning of Cyprus Daniel Gros

Director of the Centre for European Policy Studies

he root of the problem in Cyprus is well known. Its two major banks had attracted huge deposits from abroad, largely from Russia, and presumably mostly from individuals who wished to escape scrutiny at home or elsewhere. The proceeds were then invested in Greek government bonds and loans to Greek companies. When Greece imploded, the investments turned sour, and the Cypriot banks that had engaged in this strategy became insolvent. Given this situation, the logical choice for the country should have been clear: if the government wanted to survive, foreign depositors must bear part of the losses. It is thus difficult to understand why the Cypriot government was at first so reluctant to inflict any losses on depositors. But the solution that was eventually agreed makes sense: the country’s two largest banks are effectively resolved. Their bad assets will be separated and wound down over time. Neither the Cypriot government nor European taxpayers will put any additional funds into these banks. The losses that remain after the bad assets have been disposed of will thus have to be borne by the banks’ uninsured creditors, which in this case means those with deposits of more than 100,000 euros (US$130,000). Although Cyprus is too small to matter for global financial markets, the crisis there could turn out to be an important precedent guiding how European policymakers deal with future banking problems. In particular, it could affect current plans for a “banking union,” which needs three elements: a single supervisor, a common resolution authority, and a credible system of deposit insurance. The Cyprus

crisis holds important lessons on all three counts.

European guarantee First, the crisis has underscored the need for a single supervisor that is not captured by local interests. The European Central Bank would never have allowed Cypriot banks to attract huge deposits by paying above-market interest rates, and then to put all of their eggs in one basket (Greece). This was a high-risk strategy without a safety net. Second, while there is still some discussion about how to create a common resolution mechanism for euro zone banks, events have shown that the ECB already de facto fills this role. No bank in difficulties can survive if the ECB does not grant or renew emergency liquidity assistance. This accumulation of power in the hands of a completely independent institution is, of course, not ideal from the standpoint of democratic accountability. But this should serve as an additional incentive for the euro zone’s member states to agree to the creation of

This realisation – that the European taxpayer does not have to save every troubled bank – might have a very beneficial effect

a genuine common resolution authority with enough funding to resolve even larger banks in an orderly way. Finally, the revolt of Cyprus’s small savers highlighted the need for a credible system of deposit insurance. The EU directive that stipulates the protection of bank deposits up to 100,000 euros does not provide a European guarantee; it only requires member states to create a deposit-insurance system at the national level. In reality, however, there has been a widespread misperception that somehow “Europe” protects small depositors. Yet a common deposit-insurance system had, at least so far, not even been under discussion, because the issue was not perceived as a live problem. Cyprus has shattered this complacency. Leaving deposit insurance exclusively at the national level is no longer an option.

Bailing in Cyprus also holds a more general lesson: Given the extreme reaction of financial markets to the collapse of

Lehman Brothers in 2008, it had become axiomatic among European policymakers that no bank should be allowed to become insolvent. But financial markets reacted calmly to the news that, for the first time, even depositors in a bank in the European Union will lose part of their money (and this was noted with glee in Berlin and elsewhere in northern Europe). The key lesson for European policymakers is thus that it is possible to “bail in” a bank’s creditors. This has not been officially admitted, but Eurogroup President Jeroen Dijsselbloem, the Dutch finance minister, expressed it clearly, saying that, after Cyprus, Europe should become more courageous in bailing in bank creditors. This realisation – that the European taxpayer does not have to save every troubled bank – might have a very beneficial effect, because Germany’s resistance to a banking union is motivated by the fear that German taxpayers would be forced to underwrite indirectly the losses of banks in the distressed countries of the euro zone periphery. This fear may now ease. The crisis in Cyprus represents an extreme and special case in many respects. But the way that the problem arose, and the solution that was finally adopted, is likely to have very important consequences for the way that Europe will address its banking problems. © Project Syndicate

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business daily April 5, 2013

CLOSING Pressure on Hollande over tax scandal IMF warns Irish of fragile recovery Pressure was building on French President Francois Hollande yesterday over a disgraced ex-minister’s secret foreign bank account, as it emerged that his one-time campaign treasurer was a partner in companies registered in the Cayman Islands. Mr Cahuzac was charged on Tuesday with “laundering the proceeds of tax fraud” after he admitted to having an undeclared foreign bank account with some 600,000 euros (US$770,000), following weeks of denials. Critics have accused Mr Hollande and his government of either trying to cover up the scandal or of mismanagement for having believed Mr Cahuzac’s denials.

The International Monetary Fund (IMF) has delivered a tough assessment of the Republic of Ireland’s economic problems. In its latest report reviewing the Irish bailout, it criticised the “inadequate progress” of Irish banks. This was in dealing with non-performing loans and tackling home repossessions. The IMF is also concerned that Irish banks are still losing money even before putting cash aside to cover those bad loans. While acknowledging the progress that Ireland has so far made, the IMF warned that more needed to be done in dealing with banking issues including home repossessions.

Ho Tram developer gets nod from Vietnam govt Paperwork should allow investor to start gaming operations soon in recently completed first phase

German economy ‘near stagnation’ Euro zone private sector activity slumps further

ermany’s economy slowed to “near stagnation” last month, while France’s recorded its biggest contraction for four years, according to a closely watched survey. The Markit Eurozone Composite Purchasing Managers Index, which measures both the manufacturing and services sectors, declined to 50.6 in Germany last month, from 53.3 in February. Any figure above 50 indicates growth. France’s reading fell to 41.9 points, its worst since March 2009. Private sector business activity for the euro zone as a whole fell to 46.5 from 47.9 in February, adding to an increasingly gloomy outlook for the economy, the survey showed yesterday. Markit said the downturn was now accelerating at its fastest rate since November, confounding hopes that the worst of the debt-crisis slump was over. The report will fuel concern that “the euro zone downturn shows no signs of ending,” Chris Williamson, Markit’s chief economist, said in a statement. “The recession is deepening once again as businesses report that they have become increasingly worried about the region’s debt crisis and political instability,” Mr Williamson said. Continued uncertainty in Italy was “commonly cited as a key factor clouding the economic outlook,” he said, adding that the “botched bailout of Cyprus could well filter through to a further worsening of business sentiment … in April.” Mr Williamson noted too that “growth almost stalled in Germany, which suggests that the only source of bright light in an otherwise gloomy region has once again begun to fade”. Germany’s index reading was the worst in the country for three months. Markit’s Eurozone Manfacturing PMI survey released earlier this week painted a similarly bleak picture of a faltering economy where unemployment now runs at a record 12 percent. AFP

Michael Grimes

michael.grimes@macaubusinessdaily.com

he developer of the Ho Tram Strip casino resort in Vietnam says it has received approval from the country’s central government for requested amendments to its investment certificate. “It’s possible to have a hotel without the investment certificate, but not gaming,” a spokesman for the developer Asian Coast Development (Canada) Ltd told Business Daily last month. A statement from ACDL did not detail yesterday what were the askedfor amendments. Union Gaming Research said in a note in November that ACDL had at that time been in default of its phase one completion deadlines as outlined in the original investment certificate granted by the government. Union Gaming stated then: “The project entity is in default of its Phase 1 completion deadline(s), which are outlined in the original investment certificate granted by the government of Vietnam. As a result the Ho Tram project will not be awarded gaming approval until an amendment to the investment certificate is granted by the government of Vietnam. This process has reportedly been slow and its timing and certainty are currently unclear.” The research house added in a commentary on Pinnacle Entertainment, a regional casino operator in the United States that is a partner in Ho Tram: “The noted default has resulted in funding issues for Phase 1 of Pinnacle’s Ho Tram project. In particular, the project’s US$175 million credit facility from a syndicate of Vietnamese banks has suspended the undrawn credit line. The former availability of US$96 million is needed in order to fund remaining construction (which we estimate represents around 22 percent of hard and soft costs). Construction may cease near-term unless an alternative source of funds is secured.” On March 7 MGM Resorts International said it was pulling out of a deal to provide resort branding and management to the first phase of the Ho Tram Strip. That part with 541 five-star rooms and suites was

Philip Falcone, left, of Harbinger Capital, one of Ho Tram’s backers, and Lloyd Nathan of ACDL on site in November

to have been known as MGM Grand Ho Tram Beach. “MGM will no longer be able to manage the first resort,” ACDL had said in an e-mailed statement at the time, although an ACDL spokesman added in a phone call with Business Daily: “They [MGM] didn’t want to wait.”

Branding partner No new branding or management partner has so far been announced for phase one. But ACDL told us last month that Pinnacle Entertainment might be able to take over the branding and management of the first phase in the absence of MGM: “That’s one of a number of options being looked at”. The person declined to state what were the other options.

Pinnacle reported in its fourth quarter 2012 results it was writing down its investment in Ho Tram by approximately US$25 million (200 million patacas). Commenting on the announcement about the investment certificate, Lloyd Nathan, ACDL’s chief executive, said: “We are delighted and honoured by today’s confirmation of our investment certificate amendment application and look forward to moving ahead with our opening,”. The Vietnam government’s draft gaming decree of August 2012 set a minimum investment threshold of US$4 billion per casino resort, and upheld a ban on gambling by locals without foreign passports. ACDL’s multi-phase property counts as one resort for the purposes of the decree.