Macau Business Daily, Jun15th, 2012

Shop site Taobao ends local store credit sales From July 8, locals will no longer be able to buy credits for popular shopping website Taobao in Macau convenience stores. Hong Kong-based Taodot says it will stop providing payment services. Some users fear the move will kill their online shopping habit but others already prefer to go through offline middlemen.

Year I - Number 55 Friday June 15, 2012 Editor-in-chief: Tiago Azevedo Deputy editor-in-chief: José I. Duarte MOP 6.00

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Escape velocity: AirAsia route back on Page 7

Minimum wage: the brawl goes on

W

ith academic research on a possible statutory minimum wage for all cleaning and security staff yet to begin, workers and employers remain miles apart on the idea.

The Standing Committee for the Coordination of Social Affairs, which brings together representatives from workers, employers and the government, agreed to commission a study almost 16 months ago But the authorities are not yet sure when it will begin, even four months after Secretary for Economy and Finance, Francis Tam Pak Yuen, gave the green light to the contract.

Research that ‘will serve as reference for the government in formulating the future minimum wage

system’ is set to take at least one year.

Even though representatives of workers and employers agree on the introduction of a minimum wage for cleaning and security staff, there’s no consensus on a citywide minimum wage such as the one in Hong Kong.

The Macau Federation of Trade Unions criticises the government for rejecting a proposal to set up a schedule for discussion while the study is being carried out.

But the president of the Association of Property Agents and Realty Developers, Ung Choi Kun, warns that small- and medium-sized enterprises must also be protected.

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Wastewater boss ‘won’t risk’ return

18950

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18900

he chief executive officer of Waterleau NV Group says he will not come to Macau because he fears being arrested in connection with Ao Man Long’s corruption scandal. But Luc Vriens denied all charges of having bribed the former official to get contracts for wastewater treatment plants, while laying in blame on ‘local agent’ Pedro Chiang.

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HSI - Movers

Tour growth slows down

Name

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isitor arrivals via package tours grew by 28 percent year-on-year in April but the expansion was much slower than in the first quarter, official data show.

Nonetheless the president of Macau Travel Council, Andy Wu Keng Kuong, expects a ‘steady’ increase in the number of tourists this year. However, the market remains heavily reliant on mainland Chinese visitors, he warned.

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%Day

SWIRE PACIFIC-A

0.93

HONG KG CHINA GS

0.87

BANK OF COMMUN-H

0.81

NEW WORLD DEV

0.34

HENGAN INTL

0.26

CHINA RES ENTERP

-2.78

CHINA PETROLEU-H

-2.81

SANDS CHINA LTD

-4.32

CHINA CONST BA-H

-4.64

ESPRIT HLDGS

-12.43

Source: Bloomberg

‘Nice guy’ Leven at LVS until at least 2014

Brought to you by

M

ichael A. Leven, president and chief operating officer of Las Vegas Sands Corp. has signed a new contract that keeps the 74-year-old in his current post until at least the end of 2014. Mr Leven is credited by some analysts with helping to bring stability and management continuity to LVS, which operates casino resorts in Macau, Singapore and the United States but has ambitions for global expansion.

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business daily June 15, 2012

macau

Waterleau chief denies bribery, blames Pedro Chiang instead The wastewater plant operator’s chief says he was tricked by Pedro Chiang and will not be showing his face in Macau Vítor Quintã

vitorquinta@macaubusinessdaily.com

T

he chief executive of the Waterleau NV group, Luc Vriens, has said he will not return to Macau, while denying allegations that he bribed Ao Man Long when Mr Ao was a government secretary, and blaming his “local agent”, Pedro Chiang.

Mr Vriens fears arrest in Macau, he told the Belgian newsletter Incidences. “It’s definitely a risk I will not take,” he said.

There is no extradition treaty between Macau and Belgium.

His remarks were published two days before a court judgement accused him of having bribed Mr Ao, the Transport and Public Works secretary at the time, to get four contracts together worth 375.5 million patacas (US$47 million) for wastewater treatment plants on Coloane and in the Zhuhai-Macau Cross-Border Industrial Park.

The written judgement says Waterleau’s bid scored only third among five bidders for the first contract, but still got it, owing to the intervention of Mr Ao, whose praise for the company was “essential” in securing the three other contracts.

The head of Waterleau called the accusation “absolutely unacceptable” and said he had made a business agreement “in good faith with a middleman of good standing [Pedro Chiang] … whom I was forced to follow in order to enter the market”.

In a written statement to the Commission Against Corruption in June 2007, Mr Vriens said it was the former secretary who had introduced him to Mr Chiang, who was sentenced in absentia last year to six years and 10 months in prison in a related case.

Opening doors “We contacted GDI [the Infrastructure Development Office] to present our offer [for the construction of the cross-border treatment wastewater plant] and they informed us that the decision was up to Mr Ao Man Long,” Mr Vriens said.

MOP375.5 M Combined value of the four contracts granted to Waterleau

business as usual

Time to rethink the bus problem

Paulo A. Azevedo

Waterleau ‘fulfilled all the legal requirements of the tenders in Macau’, chief executive Luc Vriens said

“As I already knew Mr Ao Man Long since before 1999, I contacted him directly and I set a meeting at his office,” Mr Vriens added.

He was emphatic, however, the meeting happened at a point when he did not know about Mr Ao’s corruption.

“I believe no one knew at that time, [including] the chief executive [Edmund Ho Hau Wah], who kept the secretary in charge until the moment of his detention.”

Mr Vriens said Mr Ao had introduced him to Mr Chiang “and suggested that he would be a good local partner”.

He said: “After that I met with Mr Pedro again several times to discuss the creation of Waterleau Macau Ltda.”

Waterleau Macau is the company that ran the plants.

“As in many countries, you cannot bid for this kind of market without the services of a local agent,” he said.

pazevedo@macaubusiness.com

T

he traffic problem in Macau is not caused by having too many buses on the road. Apart from those run by the three public transport companies, there are casino shuttles and the private buses.

What causes the traffic snarls is that most of their drivers are not skilful enough and operate under a kind of law of the jungle.

Some of the chaos is created by privatesector buses. They tend to park anywhere, always travel in the right lane and show absolutely no respect to anyone else on the road.

We could blame the gaming operators, but they do not run their own bus fleets.

So, who runs these road-hogs, and, most importantly, why will no government department do anything about it?

I wonder.

Recently, Kou Ngon Seng, a member of the Traffic Advisory Committee, complained that there were no regulations beyond the standard traffic code that could be used to

manage the problem.

He said the buses should be regulated independently but the Traffic Bureau has not presented anything to be discussed by the committee that would bring this to reality.

I am not surprised. It is difficult to find any good ideas in most government departments.

Actually, even the Public Security Police seldom do anything about illegal parking and unlawful driving.

It seems their only concern is to give out parking tickets to cars and motorbikes that have not pumped coins into the parking meters.

It would be nice to know – if only the police offered the public enough respect to talk about it – whether the traffic brigade was staffed by people with enough knowledge to force everyone on the streets to drive according to the rules.

I suppose it is a much easier job to install video cameras to nab speeding motorists.

KEY POINTS Waterleau CEO says he fears arrest in Macau Bribery allegations ‘absolutely unacceptable’ Alleged bribes were payments to ‘local partner’ Pedro Chiang Waterleau Macau unaware of Mr Chiang’s ties with Ao Man Long

“You should have not only local partners but also an agent able to introduce you, to open doors for you. That’s the way it is. You have no choice.”

The court judgement says Mr Vriens paid a bribe of almost HK$7 million (US$902,000) to a company controlled by Mr Chiang and Mr Ao, Best Choice, which also got a 20 percent stake in Waterleau Macau.

Mr Ao’s latest conviction entailed the forfeiture of his 20 percent stake in Waterleau Macau Ltda.

‘Front man’ Mr Vriens said those assets were normal payment to Mr Chiang for services rendered.

“As commercial agent, he would receive for his services 3 percent of our turnover or 20 percent of the net profits,” Mr Vriens said.

He said the company had not known Mr Ao controlled Best Choice.

“We could not know at the time that the money paid to Mr Pedro, who seemed to be a big businessman, actually was landing in the pockets of Ao Man Long,” Mr Vriens said.

“If this has proven to be, years later, a front man for a corrupt official, one can essentially say: ‘You had ill luck, full stop. You are only guilty of being in the wrong place at the wrong time’,” Mr Vriens said. “[Waterleau] fulfilled all the legal requirements of the tenders and for the projects – all absolutely in accordance with law and businesses ethical rules,” he said.

“If I could have imagined what was behind those businesses I would have avoided any business in Macau. My companies were and are doing many projects around the world and I did not have any particular need to go to Macau,” he said.

June 15, 2012 business daily | 3

MACAU

InBrief

Stanley Ho invests in Moza Banco Geocapital Holdings Ltd, an investment company controlled by gaming tycoon Stanley Ho Hung Sun, subscribed last month to a share issue

by Moza Banco. The Mozambican bank increased its capital by 283.3 million meticals (US$10.2 million) to 1.2 billion meticals and the head of the board, Prakash Ratilal, said a further injection is planned for September. Geocapital is the bank’s third-biggest shareholder, with a 24.5 percent stake.

Study on minimum wage hangs fire With academic research on a minimum wage yet to begin, workers and employers remain miles apart on the idea

NPC to vote on political reform The final step of the political reform process will be taken between June 26 and 30, during a session of the Standing Committee of the National People’s Congress (NPC). The committee will review two bills sent to it by Chief Executive Fernando Chui Sai On last month. The reforms would add two indirectly elected seats and two directly elected seats to the Legislative Assembly and 100 seats to the committee that elects the chief executive.

Vítor Quintã

vitorquinta@macaubusinessdaily.com

The city already has a minimum wage – but only for employees of cleaning and security companies contracted by the government

I

t has been almost 16 months since the Standing Committee for the Coordination of Social Affairs agreed to commission a study on a statutory minimum wage for all cleaning and security staff.

But the research has yet to begin and the government is not sure when it will.

At present the city has a minimum wage only for employees of cleaning and security companies contracted by the government.

The study is set to take at least one year, so a universal minimum wage is on the back burner.

In the meantime, workers and employers are far apart on the issue.

In Wednesday’s Official Gazette, Secretary for the Economy and Finance Francis Tam Pak Yuen gave the new coordinator of the standing

committee, Wong Chi Hong, permission to sign the study contract with University of Macau.

Four months earlier Mr Wong’s predecessor, Shuen Ka Hung, had been given similar permission, but he left the committee at the end of March.

“It takes some time to finish necessary procedures,” a spokesperson for the Labour Affairs Bureau said. “We will continue to closely follow up the study in the future.”

The spokesperson had no comment on when the study would begin.

Workers with lower salaries need to be protected, but so do those small and medium enterprises whose financial situation is not good

When the economy grows, everyone should be able to share the fruits of the hard work

Ung Choi Kun, Association of Property Agents and Realty Developers president

Little consensus Macau Chamber of Commerce vice-president Vong Kok Seng and Ella Lei Cheng I, vice-president of the Macau Federation of Trade Unions, are both members of the

Ella Lei Cheng I, Macau Federation of Trade Unions vice-president

standing committee.

Mr Vong said he did not expect the study to be ready this year.

Ms Lei believes the study may take one to two years. She said that the University of Macau would submit the results in phases and that the first deadline had yet to be set.

Both agree with the introduction of a minimum wage for all cleaning and security staff.

“There is a need in society and it also shows social improvement,” Mr Vong said.

But he rejects the idea of universal minimum wage like Hong Kong’s.

Ms Lei said the study was important that but discussions among employers, the government and workers should continue in the meantime.

She criticised the government for rejecting a proposal for a schedule for discussions.

She believes a universal minimum wage is only fair.

“When the economy grows, everyone should be able to share the fruits of the hard work,” she said.

The head of the Association of Property Agents and Realty Developers, Ung Choi Kun, said: “Workers with lower salaries need to be protected, but so do those small and medium enterprises whose financial situation is not good.”

Mr Ung said a minimum wage “should be considered” but that the proposal “is not a black-and-white issue”.

A compromise between workers and employers should be reached, he said. with Tony Lai

Macau present at Africa trade fair Macau will have a special exhibition at the 23rd China Harbin International Economic and Trade Fair from June 15 to 19. The mainland’s official Xinhua news agency said the fair would focus on Africa, with a Heilongjiang-Africa economic and trade cooperation conference. Macau has been trying to promote itself a conduit for trade between China and Portuguese-speaking countries, most of which are in Africa.

Mainland maids in training for Macau Zhuhai employment agencies are already training mainland Chinese housemaids for work in Macau, according to the Portuguese-language Tribuna de Macau, although the requirements are yet to be set. One agency said mainland maids could take up to half of the market. Macau and Beijing are negotiating the import of housemaids from the mainland, and their monthly salary is likely to be at least 3,000 patacas (US$375), the authorities have said.

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business daily June 15, 2012

macau

HOSPITALITY Hotel rooms and workforce The rise in the number of hotels in recent years is naturally associated with a rise in the number of rooms. Several of the newer hotels are bigger that the older ones. Consequently, the number of rooms has been rising fast. The figures for the first four months of this year confirm this trend. By the end of April the number of hotels had risen to 97, six more than a year before, an increase of 6.5 percent. Four of the new hotels have five stars. The number of rooms increased by slightly more than 20 percent. The result is that the average number of rooms per hotel rose from 326 to 363.

0

Package tours dominate arrivals again Visitor arrivals in package tour groups continue to grow in April, but more slowly than in the first quarter Xi Chen

xi@macaubusinessdaily.com

Photo by Manuel Cardoso

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5000 10000 15000 20000 25000 30000 35000 40000

The figures show a neat and direct relationship between the number of stars a hotel has and the number of rooms and beds. The higher the number of stars, the higher the number rooms and beds alike. The statistics less often quoted are those for the number of beds. The graph shows the numbers in 2011 and 2012. The number of beds this year is almost 61,000, 23.8 percent more than last year’s total of just above 49,000. The hotel industry is an important buyer in the labour market.

Package tour arrivals are still increasing, many coming from Greater China

M

Looking at the relationship between the number of rooms and the hotel workforce, the more stars a hotel has, the more employees it has per room. Five-star hotels have the highest ratio of employees to rooms: more than 1.7 to one. Guesthouses make do with only about one worker for every five rooms. The surprise is the unexpectedly high figure for three-star hotels, with almost twice as many employees per room as four-star hotels.

J.I.D.

acau had almost 696,000 visitors arriving in package tour groups in April, government statistics show.

This is a 28-percent increase year-on-year, yet is not quite as impressive as the 51.1 percent increase reported in March.

“We foresee a steady increase of tourists this year, even though the growth might be slowing down compared to the first quarter,” Macau Travel Council president Andy Wu Keng Kuong told Business Daily.

In the first quarter package tour visitors grew by 45.6 percent yearon-year.

Visitors from mainland China alone rose by 20.3 percent yearon-year to over 491,300 in April and accounted for 70 percent of the total.

Among mainland tourists, those from Guangdong increased by 89 percent.

Nearly 99 percent of all visitors were from Asia, with strong growth seen in numbers from Hong Kong and Southeast Asia.

April saw almost 41,700 visitors arrive from Hong Kong, a 68.6 percent increase year-on-year.

During the same month 13,500 visitors arrived from Malaysia, a 64 percent increase. Thai visitors also grew 38 percent year-on-year to almost 17,900.

Taiwan, Japan, Singapore and Philippines all posted increases compared with April last year.

“This shows that Macau is becoming more attractive as a travel destination,” Mr Wu said.

“However, the base numbers were also low for tourists outside of Greater China.”

Hotel demand The city’s hotel capacity continued to expand, with two new hotels and guest-houses opening – the Conrad and Holiday Inn at the Sands Cotai Central – putting 1,939 rooms on offer.

Macau had 97 hotels and guesthouses with 24,211 rooms in April.

695,762 Visitor arrivals in package tour groups in April

The occupancy rate dropped slightly to 82 percent in April, compared with 84.5 percent last year.

“Over 80 percent average occupancy rate is still considered very high even for a tourist city, not to mention we have added a lot more hotel rooms, but there was only a slight drop in occupancy rate,” Mr Wu said.

The government said this week that the number of hotel rooms was expected to double again in coming years, with 11 hotels under construction and 21 other projects in the process of getting approval.

However, Mr Wu said supply had not exceeded demand.

“Investors are paying attention to the market, and with the construction of the ZhuhaiMacau-Hong Kong bridge and the development at the neighbouring Hengqin Island, Macau will become more and more of an international tourist destination,” he said.

He said that service was of the utmost importance and that the city needed to continue to improve its service to become a global destination.

Macau did not make it into the top 20 in a recent Mastercard survey of best tourist cities.

Mr Wu said Macau had a very narrow source of tourists, most of its visitors coming from Greater China.

June 15, 2012 business daily | 5

MACAU

Taobao e-wallets may run dry Starting next month, residents will no longer be able to buy credits for online shopping in convenience stores Tony Lai

tony.lai@macaubusinessdaily.com

H

ong Kong company Taodot has said it will stop providing electronic payment services to the popular Chinese-language shopping website, Taobao Marketplace, next month.

In a statement published on its website earlier this month, Taodot said it would stop recharging credit for Taobao e-wallets by July 15 because the company’s business policy was being restructured.

“The company will focus on the development of logistics services in future to enhance customers’ experience,” its statement said.

Taodot was not available for comment.

Taobao, also known as the Chinese version of Amazon and eBay, was founded by mainland China’s Alibaba Group in 2003 and has been a popular online shopping platform among Chinese, even in Macau and Hong Kong.

According to Alibaba statistics, transactions on the online shopping platform reached 600 billion yuan (750 billion patacas) last year.

Jack Ma Yun, chairman of the

corporation, told the media he hoped sales would reach a new record of 1 trillion yuan in 2012.

Taodot allows Macau residents to buy credits for Taobao e-wallets at 7-Eleven convenience stores and through credit cards and mainland bank accounts.

The public can buy e-credit vouchers in convenience stores in the range of HKD200 to HKD2,000 to recharge their shopping accounts.

But convenience stores must stop selling vouchers by July 8.

Cecilia Ma Hei Man, a regular user of Taobao, told Business Daily this would cause her some trouble as she would not be able to renew credits instantly at home.

“I don’t feel safe to use credit cards on mainland websites,” she said.

“Now I can only refill my e-wallet by going to the mainland to deposit money or find a middleman. Both are not convenient for me when I want to do it quickly.”

There are some businesses set up in the city for helping people order or receive goods from Taobao for charges of 5 patacas to 10 patacas per purchase.

7-Eleven convenience stores will stop selling vouchers by July 8

Mr Chan, owner of one such business in the northern district, told Business Daily his shop received several hundred shipments per month fulfilling local orders and that it helped customers to refill their e-wallets.

Mandy Lam, another Taobao buyer, said the end of vouchers did not affect her as she shopped in Taobao with the help of middlemen.

“It’s less troublesome, as I only need to send the link to the shop and it’s done,” she said.

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business daily June 15, 2012

macau LVS president to stay on until at least 2014

Brought to you by

Hospitality veteran Michael Leven has full backing of boss Sheldon Adelson Associate Editor

Booming retail The growing population and the rising number of visitors have resulted in a change in the dynamics of the retailing sector. Since 2008 the Statistics and Census Service has published the results of a quarterly survey of the volume of sales in 16 sub-sectors. The volume of retail sales in the first quarter of 2012 was more than double what it was four years before, having grown at an average annual rate of about 20 percent. The volume of most kinds of retail sales increased by 50 percent or more in that period. The volume of a few kinds boomed and, unsurprisingly, the goods bought are among those in greatest demand by visitors.

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1 The chart shows the five categories of goods most in demand between the first quarter of 2008 and the first quarter of 2011, measured by the growth factor of the volume sold and compared with the average growth factor, represented by the horizontal line. Sales of communications items, the best-selling category, increased almost fourfold, the equivalent to an average annual rate of just over 40 percent. This explains why mobile phone shops have sprung up like mushrooms.

Then comes a very broad category, department store purchases, which covers an assortment of goods. Sales almost tripled. Close behind were sales in the leather goods category and the clocks, watches and jewellery category.

In the adults’ clothing category the volume of sales increased 2.5 times. In only six subsectors of the retailing business was growth in sales slower. In two sub-sectors– motorcycles and domestic fuel – the volume of sales fell.

The fall in sales of motorcycles is scant comfort to motorists that find the roads increasingly congested, because the number of bikes on the road keeps accumulating. And to add to the discomfort of motorists, the volume of car sales was 42 percent higher in the first quarter than four years before.

J.I.D.

M

ichael A. Leven, the president and chief operating officer of Las Vegas Sands Corp. has signed a new contract that will keep the 74-year-old in his current post until at least the end of 2014.

LVS operates casino resorts in Macau and Singapore under local subsidiaries as well as properties in the United States.

The news follows a raft of contract renewals for other key LVS executives. In recent years the company has had – relative to its industry peers – a considerable turnover of key people, but now appears to be focusing on continuity.

In March 2009 Bill Weidner, Mr Leven’s predecessor as president and COO, left the company after 14 years, describing an internal battle over how to fund LVS’s then heavily leveraged operation as a “junkyard dogfight”. His boss Sheldon Adelson, chairman and chief executive of LVS responded: “We helped him resign a little bit”, hinting if he hadn’t jumped he would have been pushed.

That same month Brad Stone, then executive vice president and president of global operations and construction, also resigned, followed by LVS director James Purcell.

Steve Jacobs In July 2010 Steve Jacobs, then president and CEO of Sands China, was sacked after 16 months in charge of Macau operations. Mr Jacobs guided the Macau business through the dramatic cost-cutting required in early 2009 following the global financial crisis of late 2008 – when the very existence of a then heavily leveraged LVS was called into question by its own auditors – and through Sands China’s US$2.5 billion (20 billion patacas) initial public offering in Hong Kong in November 2009. The company said Mr Jacobs was eventually sacked for “cause” citing unauthorised deal making and statements about non-Macau projects. Mr Jacobs says he was “wrongfully terminated” and is attempting to sue Sands China via a court in Nevada. LVS is currently trying to get the case

Michael Leven – trusted by boss and source of stability for LVS

moved to Macau.

In February 2011 Tom Arasi CEO of LVS’s Singapore property Marina Bay Sands since August 2009 – the pre-opening phase – resigned after 18 months in the role citing “personal reasons”. Mr Arasi, who on appointment had a background in hotel management rather than gaming, steered the property through its challenging opening phase in April 2010.

of time,” he said in a statement.

In a proxy filing by the parent company in late April, Mr Leven was shown to be one of the world’s highest corporate earners in 2011.

He received compensation worth US$94.8 million - US$71.3 million exercising previously awarded stock options, and US$23.5 million in executive pay and incentives.

News welcomed

Last month Sands China said in a filing to the Hong Kong Stock Exchange that Ed Tracy, Steve Jacobs’ successor as Sands China boss, was having his contract renewed for a further 16 months.

If he sees out his new deal running until August 26 next year, it will make him the longest-serving president and chief executive officer of Macau operations for LVS since Sands China was floated.

LVS also recently gave a contract extension to Rob Goldstein, global gaming president, and in April hired Chris Cahill as executive vice president of operations. Mr Cahill, formerly chief operating officer of Fairmont Raffles Hotels International, reports to Mr Leven.

The investment community yesterday welcomed news that the company has persuaded Mr Leven to stay on. “If Mr Leven is willing to carry on I don’t see the need to change a winning team,” one analyst told Business Daily yesterday. “He obviously has the confidence of the chairman, and that must help in the day-to-day running of the company.”

That assessment was apparently echoed by Mr Adelson. “Under Mike Leven’s leadership our company has experienced tremendous success, and I am very grateful and honoured that he has committed to be here with us for a longer period

Busy schedule

Weather Beijing 30/18o C Changchun 23/16o C

Harbin 24/17o C

Xian 33/16o C Shanghai 28/23o C Chengdu 28/22o C Kunming 24/17o C Haikou 30/25o C Sanya 32/28o C

Guangzhou 33/25o C

MACAU (11 June-16 June) Day

Temperature

Humidity

06/11

27/31o C

65/95 %

06/12

26/29o C

70/95 %

06/13

25/28o C

75/95 %

06/14

25/28o C

75/95 %

06/15

25/29o C

70/95 %

06/16

26/30o C

65/95 %

Shenzhen 31/26o C

ASIA (today)

Hong Kong 29/25o C

Manila

TOKYO

Jakarta

31/26o C

31/25o C

22/17o C

32/24o C

Macau 29/25o C

Bangkok

SEOUL

K. lumpur

34/28o C

SINGAPORE

27/18o C

34/26o C

taipei

30/25o C

June 15, 2012 business daily | 7

MACAU

AirAsia unfreezes plan for service from Clark Low-cost carrier to start flights to Macau on July 19

B

udget carrier AirAsia Philippines now says it will start flying between Clark Field in the Philippines and Macau on July 19.

The announcement came just two weeks after the airline said it was shelving its plan for daily flights to Macau amid a simmering maritime dispute between China and the Philippines.

AirAsia Philippines chief executive Marianne Hontiveros said the service would benefit business travellers and Filipinos working overseas.

“They can reconnect and bring their families closer more than ever,” she said in a written statement issued on Wednesday.

She said the service would help at-

MPEL pressured as analysts cut Macau growth forecasts

S

hares in Melco Crown Entertainment Ltd came under pressure in New York on Wednesday night (Thursday Macau time) after analysts reduced their estimates for gaming revenue growth in Macau during 2012.

MPEL, traded on the Nasdaq and in Hong Kong, saw its American depositary receipts sink to US$11.75, ending a sixday rally. The receipts, each representing three underlying shares in the company, traded 3.1 percent below MPEL’s Hong Kong stock, the widest discount since June 1.

CLSA Asia-Pacific Markets, an independent brokerage and finance

house, lowered its 2012 forecast for year-on-year gaming revenue growth in Macau from 21 percent to 16 percent. It follows a lowerthan-market-expectation growth figure for May of seven percent and indications revenues may become lumpier during the rest of the year. CLSA also reduced MPEL’s 12-month price target to US$20 from US$23.20.

Cameron McKnight of Wells Fargo in New York said in a note: “We continue to expect Macau annual revenue growth for 2012 of 18 percent, comprised of 12 percent growth in VIP, 34 percent growth in mass, and 20 percent growth in slot revenue.”

US$2.7bn loans offered to Wynn Macau

W

ynn Macau has attracted nearly twice as much money in loan commitments as it originally sought for its Wynn Cotai project, says Bloomberg. The financial wire service, citing “two people familiar with the matter” said Wynn Macau has secured syndicated loan pledges worth US$2.7 billion (21.6 billion patacas) “from about 15 banks” and was considering increasing its loan facility to US$2.5 billion from its original target of US$1.5 billion.

During the first quarter earnings call for the parent company Wynn Resorts Ltd in May, Matt Maddox, Wynn’s chief financial officer

indicated that up to 40 percent of the Wynn Cotai budget would be funded by equity – supported by cash flow from current operations.

But if the company can secure loans at a sufficiently attractive price it may decide to increase the debt component of the funding package. That in turn would give the firm greater freedom to offer further share dividends. Asked at a press conference earlier this month in Macau if the firm would continue to pay them, Steve Wynn, chairman and founder of the business said: “Yes. That’s why people invest in companies, so they can get dividends.”

tract Macau tourists to the Philippines once again, after China cancelled all organised tours because of a dispute with the Philippines over ownership of a shoal in the South China Sea. Ms Hontiveros told Agence France-Presse on June 1: “I was advised that travel agents in Macau had cancelled tour groups

to the Philippines.”

On Wednesday she said: “Thai AirAsia and Malaysia AirAsia have been operating flights to Macau since 2004 and will support our marketing efforts to attract tourists from Macau and Hong Kong to fly with us to Clark, and onwards to Kalibo, Puerto Princesa and Davao,” she said.

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business daily June 15, 2012

without specifying a timeline. Mr Or is the former chief executive of Hang Seng Bank Ltd. Esprit’s stock plunged 22 percent in Hong Kong on Wednesday, the most in 15 years, on news of the CEO leaving, before trading was suspended. The chairman’s departure was reported after the share suspension. The shares dropped 12.4 percent to HK$9.23 in Hong Kong trading yesterday.

“We see strong support at the HK$7-8 range, where private equity should see a reasonably attractive entry point,” Religare Capital Markets analyst Peter Williamson said in a note.

Esprit cited personal reasons for both exits. The retailer has also had departures from its board, reporting the resignation of Francesco Trapani, a non-executive director, for “other personal commitments” in February.

“Who’s going to steer the company?” said Gabriel Chan, an analyst at Credit Suisse Group AG, after the CEO quit. “We know nothing more than the one-page announcement, and investors hate such kind of opaqueness.”

billion at the end of 2010.

“The fact that Zara and H&M are doing well indicates that the industry is in a good shape,” said Sandy Mehta, chief investment officer at Value Investment Principals Ltd. “Esprit is still a strong global brand, but competition is getting tougher and it will take longer for Esprit to reposition itself.”

In February, Mr Van der Vis said the clothing retailer would add sourcing offices in India and Indonesia to cut costs and add 40 to 50 stores in China as part of its drive to boost profit.

Esprit’s earnings have fallen as it loses customers to Zara and Stockholm-based H&M, which are seen as trendier by some younger shoppers.

In September, Esprit reported that profit fell 98 percent and, in a statement, said the brand “has gradually lost its soul over the past few years.”

“Esprit had become too much a T-shirt company,” Mr Van der Vis said in the interview with Bloomberg earlier this year. “The customers I spent a lot of time talking to said: Please give me back the Esprit I used to know.”

GREATER CHINA

Esprit plummets second day Share slide sparks takeover speculation

A

s Esprit Holdings Ltd’s chief executive officer and chairman quit within 24 hours of each other, investors’ biggest question was: Who’s in charge?

The fashion brand left the financial community in the dark on the resignations and succession plans.

Chief executive Ronald Van der Vis quit on Tuesday and the Hong Kong-based company reported the departure of its chairman a day later.

The exits highlight the steady decline of a once-popular brand that has lost out to rivals including Hennes & Mauritz AB and Inditex SA’s Zara. The departures, which come six months after the chief financial officer resigned, leave Esprit with a gap in senior management as it struggles to recover from a threeyear profit decline.

“The moves could lead to questions regarding whether there are issues with the operation/accounts or there is a power struggle among the management team and the board,” Anne Ling, an analyst at Deutsche Bank AG, said in a note to clients.

The exact timing of the CEO’s departure will depend on “how quickly we can get a replacement,” said Patrick Lau, head of investor relations, declining to comment further on succession. Mr Van der Vis is required to give 12 months’ notice, according to Mr Lau, and the company said he will leave on or before July 1 next year. Chairman Hans-Joachim Koerber is being replaced by independent director Raymond Or Ching Fai.

future of a costly turnaround plan at Europe-focused Esprit.

The departure of both senior executives stoke speculation the clothing retailer could become a takeover target.

“Resignations of the top two executives are not a good sign.

The stock is set to face pressure in the immediate run as investors lose faith in the company,” said Francis Lun, managing director at investment firm Lyncean Holdings.

“As the stock falls, it could easily become an acquisition target by rivals or private equity funds.”

Banking sources have told Reuters some private equity groups had previously looked at Esprit, and the stock plunge would likely attract renewed interest.

Top priority Finding a new CEO is a “top priority,” Mr Or told Hong Kong broadcaster Now TV yesterday,

KEY POINTS Key executive resignations cast doubt over management Shares extend slide after 22 percent plunge

Takeover target

Competition getting tougher; European market drops

The stock has lost up to a third of its market value in two days as the departures raised worries about management stability and the

Company lost 73 percent of its market value last year

Tough competition Esprit had revenue of HK$33.8 billion (US$4.4 billion) for the year ended June 2011, compared with Spain-based Inditex’s 13.8 billion euros (US$17.4 billion) for the year ended January.

The company’s market value is now US$1.75 billion, compared with a market value of around US$8

Turnaround continues Esprit, which lost 73 percent of its market value last year, reported a 74 percent drop in first-half profit in February.

Esprit gets about 79 percent of its revenue from Europe, which is confronting a debt crisis and high unemployment. Hennes & Mauritz

Esprit Holdings (330 HK) HKD

43 38 33 28 23 18 13 8

Jan-11

Jun-12

China productivity jolt urged Global financial companies cut mainland’s growth forecast

C

redit Suisse Group AG and Deutsche Bank AG reduced forecasts for China’s growth this year as weakness in exports and in investment drag on the world’s second-biggest economy.

Credit Suisse reduced its estimate to 7.7 percent from 8 percent, while Deutsche Bank lowered its forecast to 7.9 percent from 8.2 percent, according to e-mailed research notes yesterday. The predictions indicate the weakest growth since 1999 and compare with a 9.2 percent expansion last year.

Corporate profits are falling, deflation is looming and the nation faces years of “weak” growth, Credit Suisse economist Tao Dong said. To unleash productivity gains and restore the economy’s strength, the government should break monopolies in banking and utilities, open the services industry, and deregulate interest rates and the exchange rate, he said.

“Investment is unlikely to see a meaningful rebound in the

foreseeable future,” Hong Kongbased Mr Tao said. “Government stimulus could moderate the downside risks to growth and perhaps cushion the down-cycle, but we do not see it providing sustainable upward growth momentum.”

The cuts to the forecasts and a downgrade in Spain’s credit rating

by Moody’s Investors Service on Wednesday sent Asian stocks lower.

Ratings downgrade Spain’s rating cut underscored the threat to Asian exporters from Europe’s debt crisis.

“We expect China to be in a weak growth cycle for the next several years featuring a weak credit cycle, weak export cycle and weak property cycle,” Credit Suisse’s Mr Tao said. An emerging “deflationary force” may lead to sharp declines in nominal gross domestic product and corporate profits, he said, adding that the economy is quickly

KEY POINTS China’s growth forecast cut to below 8 pct Weakest growth since 1999 expected Corporate profits falling, deflation looming losing momentum.

“Looking back in history, almost every 10 years, China has had one top-down structural reform to unleash improvements in productivity,” he added.

Fixed-asset investment excluding rural households rose 20 percent in the first five months, according

to the statistics bureau. That was the weakest gain for a JanuaryMay period since 2001, according to previously released data. Growth in industrial output and retail sales

June 15, 2012 business daily | 9

GREATER CHINA

US$1.75 billion Esprit’s market value, down from US$8b at the end of 2010 Fashion brand left the financial community in the dark on its succession plans

received 52 percent of its sales in the fiscal year ended November from the eurozone excluding Finland, while Inditex got 37 percent from the European Union, based on data compiled by Bloomberg.

In February, the brand born in San Francisco said it was closing all stores in North America after failing to find a buyer for the unprofitable business. Its U.S. and Canadian operations lost HK$1.6 billion in a four-year period, Esprit said last year.

While announcing Mr Van der Vis’s departure, Esprit said it plans to continue with the turnaround efforts. The 44-year-old Dutchman

is leaving just as Esprit started showing some improvement in same-store sales.

The fashion group has launched an HK$18 billion restructuring plan due to be completed by 2015.

The retailer in May said revenue at outlets open more than a year rose 0.5 percent in the three months ended March after dropping 4.6 percent in the six months to December 31.

“The new management team will face a big challenge,” said Credit Suisse’s Mr Chan. “Not only to revive the brand, but also putting a team together.”

Insurers to be allowed wider investment scope

Reuters/Bloomberg

Insurance companies may be able to conduct short selling of securities

C

China faces years of ‘weak’ growth – analyst

trailed forecasts in May. Credit Suisse cut its full-year inflation forecast to 3.1 percent from a previous projection of 3.7 percent. Over the next 12 months,

the government may cut bank reserve requirements three times, lending rates twice, and the deposit rate once, Mr Tao said.

Bloomberg

hina may widen insurers’ investment scope to include derivatives and bank creditbacked securities after the industry regulator said it would give the companies more choices to invest in earlier this month, according to Guosen Securities Co. Insurance companies may also be allowed to conduct margin trading and short selling of securities, Guosen’s Shenzhen-based analysts Shao Ziqin and Tong Chengdun wrote in an e-mailed report yesterday citing draft rules the regulator circulated to seek feedback.

Investment ceilings may be raised for corporate bonds, unlisted shares and real estate, according to Guosen.

The China Insurance Regulatory Commission drafted 10 rules that will broaden insurers’ investment choices in bonds, infrastructure, property and overseas markets to boost support to the real economy and capital-market reforms, the watchdog said in a statement on its website on June 4. The easing of the rules may lift insurers’ valuations, which remain depressed partly due to concerns about their long-term investment yields, to “reasonable”

levels, the Guosen analysts wrote.

“The concerns will disappear over time as the new rules are implemented gradually,” they wrote. Still, “overseas experience suggests that, even after investment channels are opened, the overall investment returns on insurance funds will be on par with benchmarks” due to policyholders’ risk aversion.

The regulator last month allowed insurance companies to buy exchange-traded corporate bonds that are unsecured, as well as non-financial company debt and unsecured convertible debt issued by commercial banks.

Under the draft rules, insurers will be allowed to decide on the proportion of funds they invest in secured corporate bonds while the ceiling on unsecured bonds issued by non-financial companies will be 50 percent of their total assets at the end of the previous quarter, according to the Guosen report. The limit on holdings in closely held equities will be raised to 10 percent from 5 percent currently, according to the report.

Bloomberg

10 |

business daily June 15, 2012

asia

India’s inflation InBrief picks up Philippines holds rate

The Philippines held its benchmark interest rate at 4 percent for a second meeting to shield the economy from Europe’s debt crisis and slowing growth in China. Inflation eased in May, with consumer prices rising 2.9 percent from a year earlier. Bangko Sentral ng Pilipinas targets inflation to average 3 percent to 5 percent this year and next. The Philippine peso has climbed about 3 percent this year, the biggest gainer among Asia’s 11-most widely traded currencies.

Malaysia Airlines fined An Australian court yesterday fined Malaysia Airlines Aus$6 million (US$5.98 million) for price-fixing linked to a massive international cargo cartel. Australia’s anti-trust regulator said the carrier’s cargo division was hit with the fine after it admitted that it colluded with other airlines on various fuel, security and customs fees.

“This penalty sees the total penalties ordered against this international cartel increase to a record Aus$58 million,” said Rod Sims, chairman of the Australian Competition and Consumer Commission.

Felda to raise US$3.3 billion Felda Global Ventures Holdings Bhd. raised about 10.4 billion ringgit (US$3.3 billion) in this year’s second-biggest initial public offering after Facebook Inc., said three people with knowledge of the matter. Felda Global, the world’s third-largest operator of palm oil plantations, sold shares to institutional investors at 4.55 ringgit each, sources told Bloomberg. Demand for stock from fund managers exceeded supply by more than 29 times at that price, two people said.

Renesas to secure loan Loss-making Renesas Electronics Corp is in final talks to secure a 50 billion yen (US$630 million) loan from four banks after its major shareholders refused to inject fresh capital, the Mainichi newspaper said yesterday.

Shares in Renesas surged as much as 21 percent to a one-month high.

The company’s major shareholders – Mitsubishi Electric Corp, Hitachi Ltd and NEC Corp – would provide loan guarantees to allow the company to secure the loan, the Mainichi said.

Govt urged to restart economic liberalisation programme

I

ndia’s benchmark inflation rose in May to 7.55 percent, keeping price pressures elevated and making it harder for the central bank to revive economic growth with a widely expected interest rate cut next week.

The rise in the wholesale price index (WPI) from 7.23 percent in April came as both food and fuel prices picked up.

The increase keeps inflation near its highest level this year – March data was revised up to a 2012 high of 7.69 percent – as policymakers come under pressure to revitalise an economy running at its lowest ebb in nine years and to steer the country away from a damaging ratings downgrade to junk status.

Still, traders said core inflation, which excludes volatile food and fuel prices, was around 5 percent, giving the Reserve Bank of India (RBI) room to cut its policy rate at a meeting on Monday.

“Since core inflation is still below 5 percent, I would expect RBI to cut rates by 25 basis points as that is the key number,” said A. Prasanna, an economist at ICICI Securities Primary Dealership in Mumbai.

India’s bond prices and stocks fell, while the rupee weakened after the data because it dashed earlier speculation that the headline figure

would be below 7 percent.

India’s repo rate of 8.00 percent is the highest central bank policy rate among major economies in Asia. It cut the rate by 50 basis points in April as the growth outlook became more of a concern.

A political logjam in New Delhi and the eurozone debt crisis are weighing on Asia’s third-largest economy.

Capital inflows have slowed and the current account deficit widened.

KEY POINTS March inflation revised up to 2012 high of 7.69 pct No room left for fiscal stimulus – analyst Central bank expected to cut rates next week

Growth slumped to a nine-year low of 5.3 percent in the first quarter of calendar 2012 and data this week showed industrial output growth

Malaysia seeks budget boost Govt asked an extra US$4.3 billion in spending

T

he Malaysian government has asked parliament to approve an extra 13.8 billion ringgit (US$4.3 billion) in spending for 2012, legislators said yesterday, taking total expenditure this year about 6 percent above the initial 230 billion ringgit national budget.

The extra spending is likely to cast further doubt on the government’s commitment to fiscal discipline as it heads for a closely-fought national election expected later in the year.

The government had aimed to cut the deficit to 4.7 percent of gross domestic product this year and to about 3 percent by 2015 from 5.4

NZ Central Bank softens outlook New Zealand’s central bank held its official cash rate at a record low yesterday, setting the scene for a prolonged period of low interest rates. The Reserve Bank of New Zealand (RBNZ) left the benchmark rate at 2.5 percent, where it has been since March last year. “It remains appropriate for monetary policy to remain stimulatory,” RBNZ governor Alan Bollard said.

“Our forecasts are consistent with not having to push up the cash rate for some time.”

With elections looming, the Malaysian government has been on a spending spree

flatlined in April, triggering fresh calls for the government to restart an economic liberalisation programme stalled since 2004.

A Reuters poll after the GDP figures predicted the RBI will cut its repo rate by 25 bps to 7.75 percent on Monday to support growth.

“There is no room left for any fiscal stimulus, so to trigger growth, the RBI has to lower policy rates,” said Rupa Rege Nitsure, chief economist at Bank of Baroda in Mumbai.

Still, India’s central bankers face tough choices with inflation at relatively high levels.

Supply bottlenecks that stoke price pressures remain largely unattended, undermining the inflation fight.

A fall in the rupee to a record low raises import price pressures.

percent last year. That looks unlikely as economic growth slows and oil prices fall, denting tax revenues.

“They will certainly miss their budget deficit target this year by a bit. Even without this supplementary supply bill the government would have missed it,” said Irvin Seah, an economist with DBS Bank in Singapore.

Credit Suisse said in a note yesterday that it had raised its forecast for the budget gap this year to 5.5 percent from 5.0 percent “mainly to reflect the recent fall in oil prices”.

Fitch ratings agency said this year that Malaysia, which is heavily dependent on oil revenues and whose spending is bloated by food and fuel subsidies, needed structural reforms to narrow the budget deficit.

With elections looming, the government has been on a spending spree, hoping to shore up support after its dismal showing in 2008 elections. Sweeteners this year have included pay rises for civil servants and cash payments for students, adding to the strain on government finances.

Cash handouts to low-income households alone accounted for 2.6 billion ringgit. The government may increase that amount as it considers another cash giveaway to poor households ahead of the elections, which Prime Minister Najib Razak must call by next March.

The additional spending put before parliament yesterday is likely to be approved. Just over 11 billion ringgit of the amount is for Ministry of Finance spending, of which 7.9 billion ringgit for subsidies and government handouts, has already been spent, legislators said.

Reuters

June 15, 2012 business daily | 11

asia Indonesia’s Bank Jabar to buy 51 small banks

I

A fall in the rupee to a record low may raise import price pressures

Standard & Poor’s this week threatened to downgrade the country’s investment grade sovereign rating to junk, citing weakening economic fundamentals

and policy inaction. It cut the outlook on its long-term rating on India to negative from stable in April.

Reuters

Japan to insure Iran oil imports

ndonesia’s biggest provincial lender, PT Bank Pembangunan Jawa Barat & Banten (BJBR), plans to buy a majority stake in 51 rural banks this year in a bid to tap the huge potential of small and micro businesses, its chief executive said yesterday.

The bank already expects more than a third of its total loans in 2012 to go to micro businesses and is looking to push further into the fastgrowing but highly competitive market, where rivals include TPG Capital-backed BTPN, Bank Danamon and Bank Rakyat.

“The strategy is to become a majority [owner] in all 51 rural banks,” BJBR chief executive Bien Subiantoro told Reuters, adding that BJBR already holds a minority stake in several of the banks it is targeting.

“We’re waiting for the central bank’s approval as most of the rural banks are not in a financially good condition but we want to use the banks’ network to expand our micro loan business,” he said in an interview. He did not put a cost on the planned acquisitions.

Mr Subiantoro said BJBR, Indonesia’s 16th biggest lender by assets, was also studying a plan to set up a wealth management unit and wanted to move into sharia banking, multifinance and insurance to expand the range of its services.

Indonesia has nearly 1,700 rural banks, largely based outside cities and offering loans to micro and small businesses. As of March, 2012 the banks had total assets of 54 trillion rupiah (US$5.72 billion), according to central bank data.

BJBR reversed early gains to fall 1.1 percent to 860 rupiah a share yesterday, with a US$888 million market capitalisation, according to Thomson Reuters’ Starmine.

The bank is looking to disburse 1.8 trillion rupiah in loans to micro businesses in 2012, a 36 percent share of its total loan disbursement this year. “The banking business is not rocket science as long as we are focused and build a lot of outlets,” Mr Subiantoro said.

Reuters

Report says lower house to pass bill today

J

apan’s lower house is set to pass a bill today to provide government guarantees on insurance for Iranian crude cargoes, making it the first of Iran’s big Asian buyers to find a way to keep the oil flowing in the face of tough new EU sanctions.

A European Union ban on member countries importing Iranian oil takes effect on July 1 and includes a ban on EU insurance firms from covering Iran’s exports. That is a headache for Japan, South Korea, China and India, who together buy two thirds of Iran’s oil exports and rely on EU companies to insure them.

EU and U.S. sanctions aim to cut the oil revenues on which Tehran depends to force the Islamic Republic to curb its nuclear programme.

Japan’s special insurance bill is expected to go through the upper house and become law before the parliamentary session ends on June 21, the Yomiuri newspaper reported yesterday.

Iranian oil accounted for nearly 9 percent of Japan’s crude imports last year. Japan has reduced the flow already to comply with U.S.

sanctions requiring buyers to make sizeable cuts to Iranian imports, but wants to avoid more drastic reductions that may drive up energy import costs and hurt the world’s third-largest economy.

Japan won a waiver from U.S. sanctions for those cuts, which refiners enacted even as they dealt with an increase in overall oil demand after last year’s Fukushima disaster shut down the country’s nuclear power stations.

The Japanese government wants to make the bill law this month to provide protection coverage of up to US$7.6 billion per tanker carrying Iranian crude bound for Japan.

It is the first time Japan has sought to provide guarantees on marine shipments, said an official in the country’s transport ministry, which is sponsoring the legislation. The official, who helped draft the bill, said he didn’t know when the law will be passed by parliament.

The biggest opposition party, the Liberal Democratic Party, and its former partner, the New Komeito, have backed the bill, the Yomiuri report said.

Japan to continue Iran imports after EU insurance ban

Reuters

Sri Lankan Treasury Secretary P.B. Jayasundera

Sri Lanka may cut policy rate – govt

S

ri Lanka may need to consider easing monetary policy if trade data for May and June point to significant weakness in global demand for the island’s goods, the treasury secretary said yesterday.

A further export slowdown would put additional pressure on the economy as domestic demand has already shown signs of cooling following a series of tough policy measures earlier this year, P.B. Jayasundera told Reuters in an interview.

“Demand has drastically reduced. We must watch May and June data seriously and see whether there is a need for any softening in monetary policy,” said Mr Jayasundera. “A policy rate reduction may be considered in July or August.”

The central bank has raised key policy rates twice since February to more than two-year highs, restricted banks’ lending, and allowed flexibility in the rupee exchange rate in a bid to curb inflation, reduce the trade deficit and avert a balance-of-payments crisis.

The measures have had mixed results. Imports contracted in April on a year-on-year basis for the first time in 25 months, shrinking 3.3 percent, while exports contracted 9.2 percent.

Growth in private sector credit in April, meanwhile, slowed to 18.7 billion rupees (US$141 million), well below the average monthly growth of 51.8 billion rupees in the first quarter of this year.

But the move to a more flexible exchange rate has seen the rupee currency tumble to record lows, adding to inflationary pressures and swelling the country’s oil import bill.

The currency has skidded nearly 17 percent since November 21, when the government announced a 3 percent devaluation. The rupee was trading at around 132 to the U.S. dollar yesterday.

Mr Jayasundera said he believed the rupee has hit a bottom and would recover to around 125 in the medium-term.

“In my view, the exchange rate has reached its maximum and will stabilise in the medium term at the earlier expected level,” Mr Jayasundera said.

Reuters

12 |

business daily June 15, 2012

MARKETS Hang SENG INDEX NAME AIA GROUP LTD ALUMINUM CORP-H BANK OF CHINA-H

PRICE

Day %

VOLUME

25.85

-0.3853565

27369971

3.19

-1.846154

7267700

2.8

0

169473280

BANK OF COMMUN-H

5

0.8064516

15914066

25.35

-1.553398

1174615

12

-2.755267

15718527

BOC HONG KONG HO

22.2

-0.6711409

CATHAY PAC AIR

11.9

CHEUNG KONG CHINA COAL ENE-H

BANK EAST ASIA

PRICE

Day %

VOLUME

CHINA UNICOM HON

10.78

-2.355072

15125438

CITIC PACIFIC

11.04

-0.8976661

1972466

63.2

-0.6289308

2039824

CLP HLDGS LTD CNOOC LTD

Day %

VOLUME

55.4

-0.4492363

1450180

SANDS CHINA LTD

25.45

-4.323308

6831316

SINO LAND CO

10.92

0.1834862

17142816

SUN HUNG KAI PRO

-0.5434783

42428750

9.72

-1.818182

6159562

ESPRIT HLDGS

9.23

-12.42884

101476188

8848180

HANG LUNG PROPER

25.2

0

4702253

TINGYI HLDG CO

-2.618658

4139011

HANG SENG BK

102.6

-0.5813953

1023139

WANT WANT CHINA

89.5

-0.8859358

1997313

HENDERSON LAND D

40.15

-0.7416564

1905017

WHARF HLDG

6.83

-0.5822416

16924269

78.2

0.2564103

1808346

HONG KG CHINA GS

16.28

0.8674102

8725601

HONG KONG EXCHNG

109.5

-1.173285

3083736

-0.2293578

13937301

HENGAN INTL

5.14

0.2226942

309131540

18.88

-2.277433

32676930

CHINA MERCHANT

22.1

-0.4504505

2652712

HSBC HLDGS PLC

65.25

78.5

-1.505646

8554574

HUTCHISON WHAMPO

63.35

-1.400778

5043298

17.22

-1.487414

17815946

IND & COMM BK-H

4.3

-0.2320186

218483624

LI & FUNG LTD

CHINA OVERSEAS

PRICE

POWER ASSETS HOL

14.64

CHINA LIFE INS-H CHINA MOBILE

NAME

COSCO PAC LTD

BELLE INTERNATIO

CHINA CONST BA-H

NAME

SWIRE PACIFIC-A

-0.2242152

1947615

0.9340339

1717646

225

-0.8810573

2309451

18.74

0.1068376

2445188

9.17

-1.820128

8085663

41.95

0

4346628

TENCENT HOLDINGS

MOVERS

7

39

3 19030

INDEX 18808.4

CHINA PETROLEU-H

6.91

-2.81294

99386630

14.82

-2.755906

14216098

HIGH

19029.55

CHINA RES ENTERP

22.7

-2.783726

2094796

MTR CORP

24.9

-0.2004008

1049529

LOW

18719.89

15.44

-1.656051

8410111

NEW WORLD DEV

8.96

0.3359462

9890173

CHINA RES POWER

14.4

-0.4149378

3842818

52W (H) 22835.03

PETROCHINA CO-H

10.28

-0.9633911

37030096

CHINA SHENHUA-H

26.6

-0.5607477

11783066

PING AN INSURA-H

60

-1.315789

12273294

(L) 16170.35

CHINA RES LAND

89 86.45

18710

11-Jun

13-Jun

Hang SENG CHINA ENTErPRISE INDEX NAME

PRICE

DAY %

VOLUME

24.55

-1.603206

15133611

YANZHOU COAL-H

CHINA PETROLEU-H

6.91

-2.81294

99386630

ZIJIN MINING-H

7267700

CHINA RAIL CN-H

5.91

-3.745928

10078300

-2.614379

5570000

CHINA RAIL GR-H

3

-3.225806

15132741

2.8

0

169473280

CHINA SHENHUA-H

26.6

-0.5607477

11783066

CHINA TELECOM-H

PRICE

DAY %

VOLUME

AGRICULTURAL-H

2.92

0.3436426

106657219

AIR CHINA LTD-H

4.45

-5.52017

41430500

ALUMINUM CORP-H

3.19

-1.846154

22.35

ANHUI CONCH-H BANK OF CHINA-H

NAME CHINA PACIFIC-H

5

0.8064516

15914066

3.54

-0.8403361

22404696

15.04

-1.441678

4635500

DONGFENG MOTOR-H

12.84

-2.283105

9938471

3.9

0.7751938

31418389

GUANGZHOU AUTO-H

6.64

0

5987921

CHINA COAL ENE-H

6.83

-0.5822416

16924269

HUANENG POWER-H

5.47

1.48423

32543006

CHINA COM CONS-H

6.8

-1.018923

16510622

IND & COMM BK-H

4.3

-0.2320186

218483624

CHINA CONST BA-H

5.14

0.2232604

309131540

JIANGXI COPPER-H

16.7

-1.066351

5841595

CHINA COSCO HO-H

3.63

-2.680965

11017259

PETROCHINA CO-H

10.28

-0.9633911

37030096

PICC PROPERTY &

8.96

-2.608696

17278523

60

-1.315789

12273294

7.84

-2.850062

1436000

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

CHINA LIFE INS-H

18.88

-2.277433

32676930

CHINA LONGYUAN-H

5.08

-2.119461

4961491

PING AN INSURA-H

CHINA MERCH BK-H

14.42

-0.2766252

9780271

SHANDONG WEIG-H

NAME

PRICE

DAY %

VOLUME

12.64

-1.710731

25231024

2.72

-0.729927

16158353

ZOOMLION HEAVY-H

10.04

-1.568627

12759206

ZTE CORP-H

15.56

1.699346

7264904

MOVERS

6

2 9660

INDEX 9518.59 HIGH

9658.47

LOW

9437.73

CHINA MINSHENG-H

7.12

-2.864939

23545530

SINOPHARM-H

19

2.37069

16930679

52W (H) 12902.97

CHINA NATL BDG-H

9.07

-2.78671

17968000

TSINGTAO BREW-H

50.9

-0.3913894

382000

(L) 8058.58

11.18

0.1701409

5607138

WEICHAI POWER-H

32.45

-4.83871

2277552

CHINA OILFIELD-H

32

9430

11-Jun

13-Jun

Shanghai Shenzhen CSI 300 PRICE

DAY %

VOLUME

PRICE

DAY %

VOLUME

PRICE

DAY %

VOLUME

AGRICULTURAL-A

2.62

0

64759303

DATANG INTL PO-A

5.65

-2.249135

19203935

SANY HEAVY INDUS

14.8

-0.8042895

17383511

AIR CHINA LTD-A

6.09

-0.9756098

6699137

DONGFANG ELECT-A

21.23

-1.025641

5128798

SHANDONG GOLD-MI

36.19

-0.9849521

11103195

ALUMINUM CORP-A

6.65

-0.4491018

5979759

EVERBRIG SEC -A

14.02

-2.163294

7714454

SHANG PUDONG-A

8.27

-0.2412545

80017463

ANHUI CONCH-A

15.87

-1.489758

18424165

GD MIDEA HOLDING

12.36

0.08097166

19432062

SHANGHAI ELECT-A

5.12

-1.915709

8049334

BANK OF BEIJIN-A

9.33

-1.060445

13151252

GD POWER DEVEL-A

2.73

2.631579

221357502

23.87

-2.92802

12777384

BANK OF CHINA-A

2.83

-1.048951

11420302

GEMDALE CORP-A

7.22

-0.5509642

30838643

SHANXI XINGHUA-A

38.52

2.012712

6173469

BANK OF COMMUN-A

4.45

-0.4474273

23952004

GF SECURITIES-A

31.65

-2.10331

6349084

SHANXI XISHAN-A

16.09

-1.710446

16480286

BAOSHAN IRON & S

4.38

-1.351351

27243898

GREE ELECTRIC

21.55

-1.822323

15030922

SHENZ DVLP BK-A

14.64

-1.347709

13047824

15.12

-2.640052

20843806

SHENZEN OVERSE-A

6.67

-1.185185

27972420

15.24

-0.1310616

980345

-1.343785

25352960 2532614

NAME

NAME

NAME

SHANXI LU'AN -A

23.34

3.411608

5291206

GUANGHUI ENERG-A

CHINA CITIC BK-A

3.96

-1

18588983

GUIZHOU PANJIA-A

28.61

-6.655791

18171770

SINOVEL WIND-A

CHINA CNR CORP-A

4.11

-1.674641

29366304

HAITONG SECURI-A

10.31

-1.996198

45124806

SUNING APPLIAN-A

8.81

CHINA COAL ENE-A

8.28

-1.075269

11285278

HANGZHOU HIKVI-A

26.43

0.07572889

3429937

TSINGTAO BREW-A

39.95

-1.358025

CHINA CONST BA-A

4.42

-0.4504505

14307595

HEBEI IRON-A

2.88

-0.6896552

14165962

WEICHAI POWER-A

31.87

-0.7783313

3543129

CHINA COSCO HO-A

4.81

-0.8247423

3825958

HENAN SHUAN-A

62.65

0.5940912

5359935

WULIANGYE YIBIN

32.94

1.792336

31931685

BYD CO LTD -A

CHINA CSSC HOL-A

23.21

-1.401869

5393121

HUATAI SECURIT-A

11.5

-3.117102

18311734

XIAMEN TUNGSTEN

48.27

-2.857718

10442480

CHINA EAST AIR-A

4.05

-1.459854

10095223

HUAXIA BANK CO

9.17

-1.609442

30866997

YANGQUAN COAL -A

16.98

-2.132565

13694376

CHINA EVERBRIG-A

2.76

-1.779359

28025283

IND & COMM BK-A

3.95

-1.175882

50272624

YANTAI CHANGYU-A

94

2.173913

1733226

CHINA LIFE INS-A

17.81

-0.3914989

20137139

INDUSTRIAL BAN-A

12.44

-1.348136

37795674

YANTAI WANHUA-A

14.96

-0.1335113

9069992

CHINA MERCH BK-A

10.86

-0.2754821

43619884

INNER MONG BAO-A

44.65

-1.932792

41967994

YANZHOU COAL-A

21.55

1.078799

7376991

CHINA MERCHANT-A

12.85

-1.077752

9329685

INNER MONG YIL-A

24.28

1.040366

19979501

YUNNAN BAIYAO-A

57.74

0.4173913

2059722

CHINA MERCHANT-A

25.97

-0.802139

4028117

INNER MONGOLIA-A

6.14

-0.8077544

45322888

ZHONGJIN GOLD

23.72

-0.461603

8637631

CHINA MINSHENG-A

6.01

-1.47541

80871167

JIANGSU HENGRU-A

28.68

-0.6925208

2459566

ZIJIN MINING-A

4.07

-0.4889976

25046302

CHINA NATIONAL-A

6.2

-1.898734

13490955

JIANGSU YANGHE-A

140.05

1.41202

3030836

ZOOMLION HEAVY-A

10.76

-2.536232

33399554

JIANGXI COPPER-A

24.68

-0.8038585

5885910

ZTE CORP-A

14.77

1.512027

24524495

13.57

-1.021152

5764513 14110592

CHINA OILFIELD-A

16.7

-2.453271

5134614

CHINA PACIFIC-A

22.21

0.04504505

34315859

JINDUICHENG -A

CHINA PETROLEU-A

6.41

-0.7739938

22129192

JIZHONG ENERGY-A

CHINA RAILWAY-A

4.47

-1.973684

15392704

KWEICHOW MOUTA-A

17.19

-2.881356

244.59

2.343194

2870473

41.34

1.34837

11050284

2.57

-0.7722008

10028219

CHINA RAILWAY-A

2.62

-1.132075

26226264

LUZHOU LAOJIAO-A

CHINA SHENHUA-A

23.49

-1.219512

11043801

METALLURGICAL-A

5.6

0.9009009

29007900

NARI TECHNOLOG-A

19.6

0.8230453

10111925

2.55

0.3937008

9666697 58712848

CHINA SHIPBUIL-A CHINA SOUTHERN-A

4.65

-0.6410256

18330882

NINGBO PORT CO-A

CHINA STATE -A

3.38

-1.169591

46433365

PANGANG GROUP -A

7.2

-4.38247

9.18

-0.1088139

MOVERS

70

218

20 2590

INDEX 2560.42

CHINA UNITED-A

3.94

-0.7556675

39509220

PETROCHINA CO-A

9080651

HIGH

2582.66

CHINA VANKE CO-A

9.28

0.1078749

48780246

PING AN INSURA-A

45.13

-0.3312721

34891006

LOW

2531.75

CHINA YANGTZE-A

6.92

0

11492211

POLY REAL ESTA-A

14.71

0.8224812

27639655

CITIC SECURITI-A

13.35

-1.184308

52316333

QINGDAO HAIER-A

12.12

1.084237

19773933

CSR CORP LTD -A

4.73

-1.86722

11548412

QINGHAI SALT-A

30.8

-0.7731959

4425225

DAQIN RAILWAY -A

7.31

-0.9485095

24132399

SAIC MOTOR-A

15.09

1.071668

11161545

PRICE DAY %

Volume

PRICE DAY %

Volume

52W (H) 3140.102 (L) 2254.567

2530

11-Jun

13-Jun

FTSE TAIWAN 50 INDEX NAME

NAME

ACER INC

30.9

1.311475

20777205

FORMOSA PLASTIC

ADVANCED SEMICON

25.4

0.9940358

16450472

FOXCONN TECHNOLO

ASIA CEMENT CORP

36.35 -0.1373626

2694397

ASUSTEK COMPUTER

290.5 -0.6837607

AU OPTRONICS COR

11.85 -0.4201681

CATCHER TECH

188.5

0

11486834

CATHAY FINANCIAL

28.95

0.3466205

8812922

CHANG HWA BANK

15.4 -0.6451613

5592491

CHENG SHIN RUBBE

71.7 -0.1392758

4712209

CHIMEI INNOLUX C

11.9

0.8474576

19728638

MEDIATEK INC

261

1.162791

7649887

CHINA DEVELOPMEN

7.02

-1.126761

31603538

MEGA FINANCIAL H

21.4

-1.154734

21509034

CHINA STEEL CORP

28.35

1.612903

15308664

NAN YA PLASTICS

55.3

2.597403

9617030

CHINATRUST FINAN

16.5

0

38919714

PRESIDENT CHAIN

152.5

-0.974026

619003

CHUNGHWA TELECOM

90.3 -0.1106195

6038425

79.1 -0.6281407

7506987

COMPAL ELECTRON

27.4 -0.3636364

8619750

TAIWAN MOBILE CO

105.5

0.4761905

4104688

TPK HOLDING CO L

FUBON FINANCIAL

28.8

0.3484321

13541358

TSMC

2493267

HON HAI PRECISIO

82.1

0.1219512

14463204

UNI-PRESIDENT

34716040

HOTAI MOTOR CO

192

0.2610966

247000

HTC CORP

361.5

3.285714

12366637

HUA NAN FINANCIA

16.25

0.619195

3980886

LARGAN PRECISION

560

-1.581722

979558

YULON MOTOR CO

LITE-ON TECHNOLO

36.5

-0.273224

1843454

QUANTA COMPUTER

19154396

SILICONWARE PREC

29.45

0

5699682

-1.675978

11830450

SINOPAC FINANCIA

10.9

-1.357466

13177908

FAR EASTERN NEW

28.75

0.5244755

7039248

SYNNEX TECH INTL

69.8

0

3102799

FAR EASTONE TELE

64.3

-2.427921

6468893

TAIWAN CEMENT

34

0

6000911

16.95 -0.5865103

6690788

TAIWAN COOPERATI

17.3

1.169591

3183060

73.6 -0.8086253

4929115

TAIWAN FERTILIZE

65.7

-1.054217

2462942

1142255

TAIWAN GLASS IND

24.3

0

6256563

FIRST FINANCIAL FORMOSA CHEM & F FORMOSA PETROCHE

79

0

PRICE DAY %

-1.733333

88

DELTA ELECT INC

NAME

73.7

Volume

93.6

-1.265823

437.5

0.1144165

4266603 3504071

79.2

-1

30462642

46.9

1.405405

5344072

UNITED MICROELEC

12.15

-1.219512

20843615

WISTRON CORP

37.35

-1.581028

5862507

YUANTA FINANCIAL

13.05 -0.7604563

11436357

MOVERS

51.9

18

25

4885.07

LOW

4830.7

4629710

7 4890

INDEX 4859.11 HIGH

0.5813953

52W (H) 6065.73 4830

(L) 4643.05 11-Jun

13-Jun

June 15, 2012 business daily | 13

MARKETS GAMING STOCKS - DAILY PERFORMANCE (Hong Kong Stock Exchange) 19.6

31.4

12.3

19.4

31.2

12.2

19.2

31

12.1

30.8

12.0

30.6

11.9

19.0 18.8

30.4

11.8

18.6

30.2

11.7

26.4

14.0

18.9

26.2 18.7

26.0

13.9

25.8

18.5

25.6 13.8

25.4

Commodities ENERGY

CURRENCY EXCHANGE RATES

NAME

PRICE

WTI CRUDE FUTURE Jul12

82.88

0.314693779

-16.60293822

111.4899979

77.40000153

BRENT CRUDE FUTR Jul12

97

-0.133841244

-8.170027454

125.6100006

94.34999847

GASOLINE RBOB FUT Jul12

265.34

-0.075318219

-2.258076399

332.1799994

246.4999914

GAS OIL FUT (ICE) Jul12

841.25

-0.737463127

-6.4758199

1045.75

810

2.189

0.183066362

-32.50077089

4.941000462

2.095999956

NATURAL GAS FUTR Jul12 HEATING OIL FUTR Jul12 METALS

DAY %

YTD %

(H) 52W

261.17

0.030640775

-8.126077321

331.9299936

256.3099861

1620.69

0.6502

3.5644

1921.18

1478.78

Silver Spot $/Oz

28.9638

0.303

4.0553

44.2175

26.085

Platinum Spot $/Oz

1480.88

1.989

6.1943

1915.75

1339.25

Palladium Spot $/Oz

620.97

0.0548

-4.9778

848.37

537.54 1955.75

LME ALUMINUM 3MO ($)

1964

-0.203252033

-2.772277228

2675.25

LME COPPER 3MO ($)

7390

-0.067613252

-2.763157895

9905

6635

LME ZINC

1882

0.106382979

2.005420054

2539.5

1718.5

3MO ($)

LME NICKEL 3MO ($) AGRICULTURE ROUGH RICE (CBOT) Jul12

16980

-1.135371179

-9.246392304

25195

15980

13.86

-0.251889169

-9.824333116

19.375

13.72500038

517

1.273261508

-11.81236674

673.5

499

Dec12

WHEAT FUTURE(CBT) Dec12

PRICE

(L) 52W

Gold Spot $/Oz

CORN FUTURE

MAJORS

ASIA PACIFIC

CROSSES

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

YTD %

-0.1104 -0.1735 0.4086 0.391 0.4791 -0.0088 -0.0026 -0.0251 -0.2016 0.0317 -0.156 0.0434 0.0117 -0.2011 0.5863 0.0142 -0.5643 -0.4133 -0.3949 0.0802 0

(H) 52W

-2.4684 -0.045 -1.7079 -2.9242 -3.0383 0.1039 0.116 -1.1852 -4.8994 -0.0634 1.1388 1.1255 2.8263 -4.0216 -0.6838 1.3291 2.9067 1.5556 2.965 -0.1403 0.0097

(L) 52W

1.1081 1.6618 0.9772 1.4578 84.18 8.0449 7.8113 6.4909 56.515 31.96 1.3199 30.716 44.35 9662 88.637 1.24736 0.90835 9.4168 11.6817 117.74 1.0311

0.9388 1.5235 0.7071 1.2288 75.35 7.9823 7.7529 6.2769 43.855 29.63 1.1992 28.661 41.879 8458 72.057 1.00749 0.79505 7.8544 9.8423 95.6 1.0288

(H) 52W

(L) 52W

ARISTOCRAT LEISU

NAME

2.91

-1.689189

32.27272

3.25

1.88

632699

CROWN LTD

8.58

1.060071

6.056858

9.29

7.45

5051389

0.078

0

-10.34483

0.124

0.06

2035500

22.2

-0.6711409

20.65218

24.45

14.24

8848180

0.233

0.4310345

1.304346

0.405

0.204

100000

2.98

0

6.428573

4.39

2.3

10000

CHINA OVERSEAS

17.22

-1.487414

32.66564

17.86

9.99

17815946

CHINESE ESTATES

8.98

-0.1112347

-28.16

13.68

8.3

144000

CHOW TAI FOOK JE

9.03

0.3333333

-35.12931

15.16

8.55

5085925

EMPEROR ENTERTAI

1.17

-0.8474576

5.405404

2.04

0.97

847071

FUTURE BRIGHT

0.82

0

95.2381

1.09

0.3

396000

GALAXY ENTERTAIN

18.82

-4.467005

32.16292

24.95

8.69

11403680 1023139

662

0.379075057

-8.055555556

898

629.5

1314.5

-0.397802614

9.155075773

1400

1115.75

COFFEE 'C' FUTURE Sep12

153.25

-0.616083009

-34.57844184

288.8500061

152.75

SUGAR #11 (WORLD) Oct12

19.59

-0.457317073

-14.19185283

26.03999901

19.23999977

AMAX HOLDINGS LT

COTTON NO.2 FUTR Dec12

70.42

0.014202528

-19.83151184

106.5

64.61000061

BOC HONG KONG HO

PRICE

CENTURY LEGEND CHEUK NANG HLDGS

World Stock MarketS - Indices

DAY %

0.9957 1.5536 0.9544 1.2582 79.32 7.9913 7.7584 6.3705 55.7988 31.57 1.282 29.942 42.635 9449 78.972 1.20083 0.80985 8.0096 10.0539 99.8 1.03

MACAU RELATED STOCKS

SOYBEAN FUTURE Nov12

NAME

18.3

DAY % YTD %

VOLUME CRNCY

COUNTRY

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

DOW JONES INDUS. AVG

US

12496.38

-0.6157248

2.282128

13338.66016

10404.49

NASDAQ COMPOSITE INDEX

US

2818.61

-0.8603376

8.193778

3134.17

2298.89

HANG SENG BK

102.6

-0.5813953

11.3402

125

84.4

FTSE 100 INDEX

GB

5449.11

-0.6327717

-2.210405

6084.08

4791.01

HOPEWELL HLDGS

19.94

0.201005

0.4028167

24.903

18.56

646913

DAX INDEX

GE

6114.93

-0.6104845

3.671875

7523.53

4965.8

HSBC HLDGS PLC

65.25

-0.2293578

10.59322

79.6

56

13937301

NIKKEI 225

JN

8568.89

-0.2206608

1.342819

10255.15

8135.79

HANG SENG INDEX

HK

18808.4

-1.1464

2.02887

22835.03

16170.35

CSI 300 INDEX

CH

2560.421

-0.783334

9.151857

3140.102

2254.567

MGM CHINA HOLDIN

TAIWAN TAIEX INDEX

TA

7075.1

-0.193685

0.04270341

8876.14

6609.11

MIDLAND HOLDINGS NEPTUNE GROUP NEW WORLD DEV SANDS CHINA LTD

KOSPI INDEX

SK

1871.48

0.6540025

2.505285

2192.83

1644.11

S&P/ASX 200 INDEX

AU

4042.239

-0.5302443

-0.3530462

4657.4

3765.9

ID

3791.618

-1.783284

-0.7947171

4234.734

3217.951

FTSE Bursa Malaysia KLCI

MA

1570.94

-0.3356109

2.626849

1609.33

NZX ALL INDEX

NZ

763.701

0.9841879

4.645202

806.015

JAKARTA COMPOSITE INDEX

PHILIPPINES ALL SHARE IX

PH

3335.73

-1.341579

9.546343

3518.96

3.4

0

13.71237

3.71

2.35

1248008

LUK FOOK HLDGS I

HUTCHISON TELE H

14.72

-3.157895

-45.68266

46.15

14.7

3789001

MELCO INTL DEVEL

6.14

-2.073365

6.412479

10.76

4.3

1192004

11.76

-3.448276

22.60021

17.183

7.6

4704146

3.83

-2.046036

-3.137215

5.217

2.887

344003

0.101

-0.9803922

-9.00901

0.153

0.08

0

8.96

0.3359462

43.13099

11.389

6.13

9890173 6831316

25.45

-4.323308

15.94533

33.05

14.9

SHUN HO RESOURCE

1.13

0

13

1.32

0.82

0

1310.53

SHUN TAK HOLDING

2.74

-2.836879

7.067708

4.668

2.241

2447882

700.441

SJM HOLDINGS LTD

13.86

-2.2567

10.83091

20.711

10.079

19154882

14.7

-0.4065041

9.375003

18.5

9.8

900502

18.46

-2.944269

-5.333333

27.48

14.807

4980821

ASIA ENTERTAINME

4.12

0.4878049

-29.93197

10.8692

3.66

42017

BALLY TECHNOLOGI

45.01

-2.554666

13.77654

49.32

24.74

804347 12000

2695.06

SMARTONE TELECOM WYNN MACAU LTD

HSBC Dragon 300 Index Singapor

SI

526.73

0.18

6.12

na

na

STOCK EXCH OF THAI INDEX

TH

1153.01

-0.4498282

12.45368

1247.72

843.69

HO CHI MINH STOCK INDEX

VN

425.28

-0.544889

20.97284

492.44

332.28

BOC HONG KONG HO

2.8

0

16.80355

3.15

1.81

Laos Composite Index

LO

1015.25

0.8422976

12.87328

1107.3

876.33

GALAXY ENTERTAIN

2.5025

0

33.82353

3.24

1.08

1500

INTL GAME TECH

13.22

-2.291205

-23.13954

19.15

13.12

3419296

JONES LANG LASAL

68.49

-2.795913

11.80216

99.89

46.01

275218

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business daily June 15, 2012

Opinion The use and abuse of religious freedom Peter Singer

W

Professor of bioethics at Princeton University and Laureate Professor at the University of Melbourne

hat are the proper limits of religious freedom?

Marianne Thieme, leader of the Party for the Animals in the Netherlands, offers this answer: “Religious freedom stops where human or animal suffering begins.”

The Party for the Animals, the only animal-rights party to be represented in a national parliament, has proposed a law requiring that all animals be stunned before slaughter. The proposal has united Islamic and Jewish leaders in defence of what they see as a threat to their religious freedom, because their religious doctrines prohibit eating meat from animals that are not conscious when killed.

The Dutch parliament has given the leaders a year to prove that their religions’ prescribed methods of slaughter cause no more pain than slaughter with prior stunning. If they cannot do so, the requirement to stun before slaughtering will be implemented.

Meanwhile, in the United States, Catholic bishops have claimed that President Barack Obama is violating their religious freedom by requiring all big employers, including Catholic hospitals and universities, to offer their employees health insurance that covers contraception. And, in Israel, the ultra-orthodox, who interpret Jewish law as prohibiting men from touching women to

whom they are not related or married, want separate seating for men and women on buses, and to halt the government’s plan to end exemption from military service for full-time religious students (63,000 in 2010).

Freedom scope When people are prohibited from practicing their religion – for example, by laws that bar worshiping in certain ways – there can be no doubt that their freedom of religion has been violated. Religious persecution was common in previous centuries, and still occurs in some countries today.

But prohibiting the ritual slaughter of animals does not stop Jews or Muslims from practicing their religion. During the debate on the Party for the Animals’ proposal, Rabbi Binyomin Jacobs, Chief Rabbi of the Netherlands, told members of parliament: “If we no longer have people who can do ritual slaughter in the Netherlands, we will stop eating meat.” And that, of course, is what one should do, if one adheres to a religion that requires animals to be slaughtered in a manner less humane than can be achieved by modern techniques.

Neither Islam nor Judaism upholds a requirement to eat meat. And I am not calling upon Jews and Muslims to do any more than I have chosen

to do myself, for ethical reasons, for more than 40 years.

Restricting the legitimate defence of religious freedom to rejecting proposals that stop people from practicing their religion makes it possible to resolve many other disputes in which it is claimed that freedom of religion is at stake. For example, allowing men and women to sit in any part of a bus does not violate orthodox Jews’ religious freedom, because Jewish law does not command that one use public transport. It’s just a convenience that one can do with-

When people are prohibited from practicing their religion there can be no doubt that their freedom of religion has been violated. [But in some cases] the appeal to religious freedom is being misused

out – and orthodox Jews can hardly believe that the laws to which they adhere were intended to make life maximally convenient.

Likewise, the Obama administration’s requirement to provide health insurance that covers contraception does not prevent Catholics from practicing their religion. Catholicism does not oblige its adherents to run hospitals and universities. (The government already exempts parishes and dioceses, thereby drawing a distinction between institutions that are central to the freedom to practice one’s religion and those that are peripheral to it.)

Of course, the Catholic Church would be understandably reluctant to give up its extensive networks of hospitals and universities. My guess is that, before doing so, they would come to see the provision of health-insurance coverage for contraception as compatible with their religious teachings. But, if the Church made the opposite decision, and handed over its hospitals and universities to bodies that were willing to provide the coverage, Catholics would still be free to worship and follow their religion’s teachings.

Difficult issues Religious exemption from military service can be more

difficult to resolve, because some religions teach pacifism. That problem is usually resolved by providing alternative service that is no less arduous than military service (so that such religions do not attract adherents for that reason alone), but that does not involve fighting or killing.

Judaism, however, is not pacifist, so, once again, there is no real issue of religious freedom at stake. The ultra-orthodox want exemption for those who spend their time studying the Torah on the grounds that Torah study is as important as military service to Israel’s well-being. Providing the option of non-combatant national service thus will not resolve this dispute, unless it consists of Torah study. But there is no reason why Israel’s secular majority should share the belief that having tens of thousands of ultra-orthodox scholars studying the Torah provides any benefit at all to the nation, and it is certainly not as arduous as military service.

Not all conflicts between religion and the state are easy to resolve. But the fact that these three issues, all currently causing controversy in their respective countries, are not really about the freedom to practice one’s religion, suggests that the appeal to religious freedom is being misused. © Project Syndicate

editorial council Paulo A. Azevedo, Tiago Azevedo, Duncan Davidson, Emanuel Graça, Cris Jiang Founder & Publisher Paulo A. Azevedo | pazevedo@macaubusinessdaily.com Editor-in-Chief Tiago Azevedo DEputy Editor-in-Chief José I. Duarte Chief REPORTER Vitor Quintã Newsdesk Cláudia Aranda, Kristy Chan, Kelsey Wilhelm, Cherry Lee, Terina Cao, Tony Lai Creative Director José Manuel Cardoso Designer Janne Louhikari Photography Carmo Correia, John Si, 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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June 15, 2012 business daily | 15

OPINION

Booming Sweden’s wires free-market solution Business Leading reports from Asia’s best business newspapers

Taipei Times The Taiwan Research Institute (TRI) on Wednesday slashed its GDP growth forecast for this year to 2.52 percent, from the 4.02 percent it estimated in December last year. The institute, however, expects the central bank to keep its policy interest rates unchanged next week. The think tank’s forecast is lower than the 3.03 percent growth forecast issued by the Directorate-General of Budget, Accounting and Statistics last month. The TRI was the second institute to cut its forecast for Taiwan’s economy this year to less than 3 percent. TRI president Wu Tsai-yi blamed worse-than-expected economic conditions in the second quarter for the downward revision.

Asahi Shimbun Japan’s government nominated two economists who have consistently called for more aggressive monetary-easing measures as members of the Bank of Japan’s policy board.

Members of the ruling and opposition parties have persistently called for such measures to propel an economic recovery before Prime Minister Yoshihiko Noda carries out his plan to increase the consumption tax rate. Takahide Kiuchi, 48, with Nomura Securities Co., and Takahiro Sato, 50, of Morgan Stanley MUFG Securities Co., were appointed on Tuesday. The new appointment comes as the previous nominee, Ryutaro Kono, a chief economist at BNP Paribas Securities (Japan) Ltd, was voted down in April.

Business Inquirer Financial services firm DBS Group said the outlook on Philippine exports for the second half of the year is “decidedly cloudy” and that it did not expect that an electronics-led surge in exports could be sustained. A policy leeway for possible moves to stimulate economic growth, which monetary authorities enjoy, may cushion the downward pressure that weak exports will have on growth this year, the Singapore-based group said in a research note. But the Philippine Central Bank is expected to keep its overnight borrowing rate unchanged at 4 percent during the policy rate-setting and to maintain a neutral stance for the rest of the year, it added.

Anders Aslund

Senior fellow at the Peterson Institute for International Economics

N

ot so long ago, Sweden could claim world leadership in unmitigated Keynesian economics, with a 90 percent marginal tax rate and a welfare state second to none. Now Swedes look at the conflict between the U.S. and German examples over whether more spending or more austerity is the key to financial salvation, and for them the choice is easy: Germany was right.

Northern Europe harbours no sympathy for the spendthrifts of Southern Europe.

Americans still think of Sweden as a tightly regulated socialwelfare state, but in the last two decades the country has been reformed. Public spending has fallen by no less than one-fifth of gross domestic product, taxes have dropped and markets have opened up.

The situation is similar in the other Scandinavian countries, the Baltic nations and Poland.

But no turnabout has been as dramatic as Sweden’s.

From 1970 until 1989, taxes rose exorbitantly, killing private initiative, while entitlements became excessive. Laws were often altered and became unpredictable. As a consequence, Sweden endured two decades of low growth. In 1991-93, the country suffered a severe crash in real estate and banking that reduced GDP by 6 percent. Public spending had surged to 71.7 percent of GDP in 1993, and the budget deficit reached 11 percent of GDP.

Turning point The combination of the crisis and the non-socialist government under Carl Bildt from 1991 to 1994 broke the trend and turned the country around.

In 1994, the Social Democrats returned to power and stayed until 2006. Instead of revoking the changes, they completed the fiscal tightening. In 2006, a non-socialist government returned, and Finance Minister Anders Borg, with his trademark ponytail and earring, has led further reforms. Sweden successfully weathered the global financial crisis that started in 2008, and the Financial Times named Borg Europe’s best finance minister last year.

Before 2009, Sweden had a budget surplus, and it has one again. For the past two years, economic growth has been 4 percent on average, and the current-account surplus was 6.7 percent in 2011. The only concerns are the depressed demand for exports caused by the current euro crisis and an unemployment rate that is about 7.5 percent.

Sweden’s traditional scourge is taxes, which used to be the highest in the world. The current government has cut them every year and abolished wealth taxes. Inheritance and

gift taxes are also gone. Until 1990, the maximum marginal income tax rate was 90 percent. Today, it is 56.5 percent.

That is still one of the world’s highest, after Belgium’s 59.4 and there is strong public support for a cut to 50 percent.

The 26 percent tax on corporate profits may seem reasonable from an American perspective, but Swedish business leaders want to reduce it to 20 percent. Tax competition is fierce in some parts of Europe. Most East European countries, for example, have slashed corporate taxes to 15-19 percent.

The values are competition, openness and efficiency, while social and environmental values remain – a social-welfare society without the social-welfare state

In the bad old days, the annual centralised-wage bargaining between the Trade Union Confederation and the Swedish Employers’ Confederation was a prized custom. But in the 1970s, this system led to both inflation and strikes. Today, it is long gone. Wage bargaining is still collective, but it is decentralised. Wage inflation is no longer a concern and strikes are extremely rare. The employers have won, but real wages are rising with productivity, so the workers are benefiting, as well.

As everywhere, trade unions are losing members, money and power.

Debt averse Sweden has belonged to the European Union since 1995, but it isn’t a member of the euro area, and the exchange rate of its krona floats freely.

Finance Minister Borg argues against a more expansionary policy in Sweden in case Europe faces a real meltdown. After the Keynesian financial and monetary stimulus in the 1970s and ’80s, which led to inflation, repeated devaluations and low growth, Swedes believe in fiscal discipline. They are scared of huge national debt and budget deficits – especially at the levels they are in the U.S. Where are the left-wing intellectuals to challenge this new

order? They have disappeared.

The old socialist research organisations have closed down.

The Center for Labor Market Studies was a state institution that generated propaganda, not research, and the government closed it. The Trade Union Confederation had a sophisticated research institute, which it eliminated for not being sufficiently political.

The union economists, who dominated Swedish economic debate in the 1970s and ’80s, have been replaced by bank economists. The free-market right has influential research centres in Stockholm.

After many years of absence from the debate, I attended a conference on the Swedish economy in the southern city of Malmo last month. Swedbank, a large bank, was the organiser, and the 180 speakers represented the full range of Swedish views. I was amazed to hear how far the consensus had moved to the free-market right, even among Social Democrats and trade-union leaders.

The values are competition, openness and efficiency, while social and environmental values remain – a social-welfare society without the social-welfare state. The idea is to make it more efficient through competition among private providers.

The name of the conference said it all: “Growth Days.”

Wanja Lundby-Wedin, the president of the Trade Union Confederation, declared without hesitation: “We want flex-

ibility in the labour market.”

She complained that the media no longer pay attention to the labour market. The reason is that it functions so well.

During the global financial crisis, the metalworkers’ union quietly agreed to major wage cuts to safeguard their real incomes in the long run. The leader of that union, Stefan Lofven, has just been elected chairman of the Social Democratic Workers’ Party.

Moving right The Social Democrats haven’t only joined the free-market consensus, but seem to attack the current government from the right, pushing for a better business environment. Gone are demands for the restoration of social benefits. Opinion polls have rewarded the Social Democrats for their right turn with sharply improved ratings.

Sweden is still offering good social welfare, but more efficiently and sensibly and increasingly through the private sector. This model of falling taxes and public spending is rapidly proliferating from the north of Europe toward the south, and the northern Europeans have little tolerance for the statist conservatism and fiscal negligence of Southern Europe. Nor do the Swedes understand the fiscal irresponsibility of the U.S., while they still admire American research and innovation.

Bloomberg View

16 |

business daily June 15, 2012

CLOSING Nokia to cut 10,000 jobs

Dissident death ‘suspicious’: Tsang Departing Hong Kong Chief Executive Donald Tsang said the death of deaf Chinese dissident Li Wangyang was “suspicious” and he has expressed his opinion to the Chinese government. Mr Tsang said he “understands the views of Hong Kong people” after thousands took to the streets over the death of Mr Li, who was found dead in a hospital ward in the Chinese city of Shaoyang on June 6. In his last scheduled address to the Legislative Council, he said yesterday the most important thing is to ensure Hong Kong people can express their views freely.

Loss-making Finnish cellphone maker Nokia plans to cut another 10,000 jobs globally in its biggest revamp in recent history, while it warned the second-quarter loss from its cellphone business would be larger than expected. The cuts, which include the closure of Nokia’s only plant in Finland, bring total planned job cuts at the group since Stephen Elop took over as chief executive in 2010 to more than 40,000. Nokia said yesterday that it would book additional restructuring charges of around 1 billion euros (US$1.3 billion) by the end of 2013.

China, HK, new steps to boost offshore yuan market Includes ‘dim sum’ bonds and ‘swap lines’ James Pomfret and Victoria Bi

C

hina and Hong Kong announced a flurry of measures on Thursday to deepen international participation in the yuan market and make trading in the currency easier, including plans to sell yuan-denominated bonds directly to foreign central banks for the first time.

The mainland’s finance ministry said it would issue 23 billion yuan (US$3.6 billion) in offshore yuan bonds, known as “dim sum” bonds, in Hong Kong later this month.

China already allows foreign central banks to purchase yuan bonds onshore through swap lines with the People’s Bank of China, but it was the first time Beijing has sent such a clear signal to the international community by setting aside 2 billion yuan specifically for central banks for a dim sum issue in Hong Kong.

Beijing is using the Asian financial centre as a test bed for its growing efforts to internationalise the yuan, which could eventually pave the way for it to become a fully convertible global currency.

In a move to further increase the supply of yuan funds in the city and allow the offshore yuan market to operate more smoothly, Hong Kong authorities said they would allow banks to borrow yuan term funds

from an existing ‘swap line’ with the PBOC to counter any supply tightness in future, thus reducing market volatility. A swap line is another term for a temporary reciprocal currency arrangement between central banks. They agree to keep a supply of their jurisdiction’s currency available to trade to other central banks at the going exchange rate.

Yuan funds With effect from today, the Hong Kong Monetary Authority will provide yuan funds against necessary collateral to banks involved in offshore yuan business, the territory’s de-facto central bank said in a notification posted on its website.

The swap line between Hong Kong and the People’s Bank of China is the biggest at 400 billion yuan (US$62.8 billion) among the many swap lines Beijing has signed with various central banks across the world.

“The facility would serve to address short-term yuan liquidity tightness which may arise from time to time, for example, due to capital market activities or sudden need for yuan liquidity by Participating AIs’ overseas bank customers,” Peter Pang, deputy chief executive at the HKMA, said in a statement.

Revolutionary moves – China and HK to boost offshore yuan trade

“It would help reduce potential market disruptions and hence enhance market confidence at all times and support the long-term development of the offshore RMB market,” he said.

Retail investors; companies that are eyeing China investments; and speculators have flocked to the yuan

Suu Kyi calls for Myanmar job investment Democracy leader ‘moved’ by reception on European tour

M

yanmar democracy leader Aung San Suu Kyi called for international investment to create jobs for her country’s youth at the start of a landmark tour of Europe following years under house arrest.

Ms Suu Kyi, who arrived at the UN offices in Geneva to flowers and applause, appealed for the investment in a speech to delegates at the International Labour Organization conference.

“It’s not so much joblessness as

hopelessness that threatens our future,” she said, making her first visit to Europe since in effect being barred from foreign trips 24 years ago and subsequently placed under house arrest.

“Unemployed youth lose confidence in the society that has failed to give them the chance to realise their potential.

“Foreign direct investment that results in job creation should be invited,” she added.

Ms Suu Kyi also spoke of the

plight of migrant workers from Myanmar in Thailand, calling for coordinated social, political and economic policies “that will put our country once again on the map of the positive and the successful.”

Unexpected reception She told her audience she was “profoundly moved” by the “totally unexpected, very warm welcome” she had received as she began a five-country tour which will include

and a spate of new yuan-related investment products in recent years on expectations that Beijing would continue to let its currency appreciate against the U.S. dollar.

But retail interest has waned in recent months as the yuan weakened to near six-month lows.

Reuters

a speech in Oslo to accept the 1991 Nobel Peace Prize she was unable to receive at the time.

Her visit marks a new milestone in the political changes that have swept the country formerly known as Burma since decades of military rule ended last year, bringing to power a new quasicivilian government.

She also told reporters that she thought French and US oil giants Total and Chevron, long a target of human rights activists for their activities in Myanmar, should continue to operate there.

But she urged foreign governments not to allow their companies to do joint ventures with Myanmar’s state-owned oil and gas company until it improved transparency and accountability.

Ms Suu Kyi said: “The Myanmar Oil and Gas Enterprise... with which all foreign participation in the energy sector takes place through joint venture arrangements, lacks both transparency and accountability at present.”

Reuters/AFP