Trade, air links to Manila growing say diplomats Philippine Airlines Inc. is aiming to increase trade and tourism with Macau via a 40 percent boost in passengers on its Manila route – despite some political tensions with China, the carrier said yesterday. Philippine exports to Macau rose 50 percent last year added Fernando Beup Junior, vice-consul of the Philippines in Macau.
Year I Number 239 MOP 6.00 Thursday March 14, 2013 Editor-in-chief Tiago Azevedo Deputy editor-in-chief Vitor Quintã www.macaubusinessdaily.com
Pages 2 & 3
Edmund Ho ‘saved from jail’ claims ‘diabolical’ says Adelson
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court deposition by former Sands China Ltd chief executive Steve Jacobs said to have suggested Sheldon Adelson wanted credit for keeping Macau’s first chief executive Edmund Ho Hau Wah “out of jail” was part of a “cunning and diabolical scheme to use the court system of Nevada to shield his [Jacobs’] campaign of defamation” states a legal filing from Mr Adelson. A seven-page Nevada deposition from the LVS chairman seen by Business Daily seeks to rebut a reported court filing on February 15 by Mr Jacobs. Mr Jacobs’ latest filing has brought Mr Ho – politically well connected and respected on the mainland – directly into the former’s wrongful termination suit. That could potentially be very damaging for LVS’s relations with the Macau and mainland authorities. More on page 5
Virtual marketing in 3-D – Interblock’s latest idea It’s the marketing assistant that never gets bored, chats to its friends or takes meal breaks. No, it’s not a race of super humans, it’s a hologram generator. Slovenian firm Interblock – a specialist in electronic table games for casinos – says it has an exclusive deal with the technology provider – Musion Systems Ltd, based in the United Kingdom – when it comes to its use in casino promotions.
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Land law: public tender exemption fears remain
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The Legislative Assembly resumed talks on the land law revision yesterday, but the discussion remained focused on the provisions allowing the government to grant land directly without public tender. Once the revised law comes into force, “public interest” projects – in particular those involving nonprofit cultural, sports or social services as well as public utilities – can be exempt from public tender.
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Philippines opens bid to join global gambling elite The Philippines makes a high-stakes bid this weekend to join the world’s elite casino destinations. The US$1.2billion (9.6 billion patacas) Solaire Resort & Casino has its soft opening at Manila Bay. It is the first of four multibillion U.S. dollar gaming resorts planned for a stretch of reclaimed land. Cristino Naguiat – head of the country’s gaming regulator, expects casino revenues to double nationally this year.
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Name
%Day
LI & FUNG LTD
0.18
TENCENT HOLDINGS
-0.07
BELLE INTERNATIO
-0.13
HANG LUNG PROPER
-0.16
WANT WANT CHINA
-0.17
BANK EAST ASIA
-1.64
ESPRIT HLDGS
-3.72
CHINA RES LAND
-4.01
COSCO PAC LTD
-4.74
SINO LAND CO
-4.83
Source: Bloomberg
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business daily March 14, 2013
macau
Philippines’ imports soar in tandem with tourism Philippine vice-consul wants stronger collaborations in the creative and medical industries Tony Lai
tony.lai@macaubusinessdaily.com
I
ntensive development of Macau’s hospitality industry has helped boost Philippines’ exports, the vice-consul of the Philippines in Macau Fernando Beup said yesterday. Mr Beup told Business Daily there had been a 50.8-percent surge in Philippines’ exports to Macau – mostly in seafood, fish and fruit. “These are exactly the things the hotel industry needs. Macau has so many tourists coming in and so many hotels, and hence there is more demand for food,” Mr Beup said. Macau bought 180 million patacas (US$22.5 million) of goods from the Philippines last year, according to official data. Mr Beup, who is in charge of Philippines’ business relations here, said he expected “a very good future” for bilateral trade as tourism ties developed. “There is always a demand for more food which cannot be sourced in Macau, which will always be sourced from other countries,” he said. “The increase in trade between the Philippines and Macau will actually be good for both sides. It sustains the tourism industry in Macau and at the same time it sustains our industries in the Philippines.” He said Macau’s exports to the Philippines were relatively smaller at 19.2 million patacas last year. Exports have shrunk in line with the decline of the city’s manufacturing sector. Speaking on the sidelines of a media lunch yesterday, Mr Beup also flagged greater collaborations in the creative and medical industries. “There are many students in
Imports from the Philippines grew by 51 percent last year, to 180 million patacas
Macau who would want to study medicine but there are no available courses here and the Philippines is very strong in that aspect,” he said. “We have many good medical schools where Macau students can actually learn from and then eventually come back with their knowledge to [help] the
business as usual
medical industry here.” Mr Beup said Macau needed to upgrade its medical services. He said the consulate also wanted to attract more Macau tourists. Philippine consul general Danilo Ibayan said Macau residents might soon be eligible for a 30-day visitor’s visa, twice the length of
the current 14-day visa. Mr Ibayan said the Philippines was confident it could build a thriving casino industry but would not be a challenger to Macau’s gaming crown. “Macau is No.1 in the world. There is no comparison between Manila and Macau in gaming,” he said.
Corporate
Myth making and diversification
Pedro Cortés newsdesk@macaubusinessdaily.com
F
or some time, the public has heard Macau needs to diversify its economy. “I need to diversify”, “you need to diversify”, “she needs to diversify” are commonly heard phrases. The pronouncements, almost as if commands from God, have been issued by different sources, from academics to politicians in Beijing. One of the definitions of the phrase “to diversify” is to develop a wider range of products, markets or investments, the Oxford Business English Dictionary tells us. It is a concept the politicians use when an economy is dependent on too few activities to generate income, as is Macau’s case with its reliance on gaming. But politicians must also foster an environment that attracts investors and actual entrepreneurs, not those making a living from speculating on real estate. How can that be done? First, regulate the market for rental properties once and for all. It is unfair to entrepreneurs who start a business to face the possibility of an increase in rent two to three years later that might reach three times the original expense. The government must also precisely state what kind of regulations a business manager could expect if they need to hire qualified non-resident staff. Then the necessary conditions must be offered to entrepreneurs that would permit younger workers opportunities outside the casino business. It is hard? Sure it is. Backed by Macau’s unique financial environment, the city’s politicians should do more to realise the concept of diversification and commit to developing the city we all want improved. Shall we do it?
Venetian hosting Star Literary Festival TV China Music Awards went to school Macau-based gaming operator Sands China Ltd is once again bringing some of China’s biggest pop music stars to the CotaiArena this year, for the Star TV China Music Awards. It will be the second time that the Venetian Macao resort hosts the award ceremony, after hosting last year’s programme, as part of the opening of Sand Cotai Central. The event, which will include over one hundred singers, movie stars and celebrities, is part of a cooperation between Venetian Macao and Star China Media Ltd. The awards show was launched in 1994 and has since gathered the nation’s music industry talent in host cities like Beijing, Shanghai, neighbouring Hong Kong, Taipei and Chengdu. The event data and the list of nominees will be announced during a press conference today, with the presence of celebrities Charlene Choi, Rainie Yang, Huang Zheng and Shui Mu Nian Hua.
Africa, literature, Macau and the Portuguese language were common threads in the dialogue between students and writers from Africa and Portugal on Tuesday, when the Macau Literary Festival –The Script Road went to school. “A festival like The Script Road is absolutely crucial in order to create a more lucid, and perhaps, more constructive [Macau],” prominent Portuguese writer Valter Hugo Mãe said at the Department of Portuguese of the University of Macau. The second edition of the Macau Literary Festival began last Sunday and will continue until Saturday. Beyond the literary world, the weeklong festival also includes several other cultural events, namely two concerts at the Cotai resort Venetian Macao. Taiwanese singer-songwriter Joanna Wang and local rock band L.A.V.Y. will perform live tomorrow, while two acts from Portugal, Dead Combo and Camané, will share the Cotai Arena stage on Saturday. Untitled-22 2
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March 14, 2013 business daily | 3
MACAU
Philippine Air sets course to cash in on Macau route Disputes with Beijing and fierce competition hurt passenger numbers between Manila and Macau last year
opinion
Going north!
Tony Lai
tony.lai@macaubusinessdaily.com
José I. Duarte
jid@macaubusiness.com
H
ousing is always a sensitive issue. The condition of the housing market strongly influence the spending and saving behaviours of families, may drive people across the city, to another city or region, and has both direct and indirect costs for business. For families, housing is often the biggest investment they will make. It is an investment made with the bank’s credit that takes one generation to repay. It will be the major expense in the family budget for much of that time. Housing is also a critical determinant of the quality of life. It is no surprise that people grow edgy when housing costs start to rise, particularly if you are a young person or a family on the verge of starting an independent life. Housing affordability is, therefore, an important topic. Affordability is affected by many factors, including cultural standards, income and credit conditions. It is easiest to measure affordability by determining how many median annual household incomes are required to buy the median-priced house. This measure tells how many years of a typical income it takes to buy the median home. It is a simple indicator and, although imperfect, provides a useful reference. It is taken for granted that a healthy housing market is one where the median house can be afforded by a person earning a median income. Of course, as the index increases, affordability declines. As the index increases, a higher proportion of the family’s income will be needed, for longer periods, to reimburse the loan principal.
Philippine Airlines is flying once a day between Macau and Manila after management set aggressive growth targets
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hilippine Airlines Inc has set itself the ambitious target of increasing passenger load by at least 40 percent on the Manila-Macau route, after boosting the frequency of flights on the route. Philippine Airlines district sales manager Reyani Romano said passenger numbers on the route grew by 15 percent last year, despite political tensions with the mainland over disputed territory in the South China Sea. Ms Romano told Business Daily that up to 90 percent of seats were full during holiday periods, and between 55 percent and 60 percent full during the rest of the year. Political tensions “affected us [the airline] as we were targeting around 25 percent growth but there was an advice from the government against trips to the Philippines”, she said. The Tourism Crisis Management Office here issued a notice last May that advised against unnecessary trips to the Philippines because of anti-Chinese street protests. Passenger numbers travelling to Manila in tour groups fell after the warning was issued. “We’re more focused on individual passengers right now, also because more people can make online bookings with the technological [development],” she said.
“But we, of course, want to encourage more people travelling in groups this year.” Ms Romano said the airline had an overall target of 40 percent growth on the route this year, after it introduced a daily flight schedule. The carrier increased flight frequency from four flights in December after the company’s board of management set a course for more growth. About 80 percent of passengers on the Macau-Manila route carried a Philippines passport last year but the airline hopes to diversity its customer base by attracting more tourists from Macau, the mainland and Portuguese nationals living here. “We have been trying to strengthen that market because in the past we used to have only a small percentage of this market,” she said.
Price sensitive The Tourism Department of the Philippines in Hong Kong and Macau says about 5,000 tourists from Macau visited the archipelago last year, a 45-percent surge over the previous 12 months. The tourism department’s director, David Leung, told Business Daily they had set a target of about 50 percent growth in arrivals from Macau this year.
Official data shows a 5.6-percent rise in Filipino tourists arriving here last year, to more than 283,000 tourists. There is “tight competition” among airlines operating routes between the Philippines and Macau, Ms Romano said. “Pricing is the number one consideration [for customers],” she said, admitting that Philippine Airlines’ fares were more expensive than the low-cost carriers competing on the route. “We are a full-service carrier and we give [our customers] whatever is expected.” She said passengers were served a free meal during the two-hour flight and offered a 27-kg luggage allowance. Low-cost carrier Cebu Pacific Air operates flights to Manila and Clark. AirAsia Inc used to fly between Macau and Clark but suspended the route in December after it said it faced “operational challenges”. AirAsia group deputy director for China, Celia Lao, said the flight would not be resumed “in the near future” because there was no demand from passengers. Philippine vice-consul Fernando Beup said there was no need for more direct flights to Macau without a significant boost to bilateral tourism.
Sticker shock When three or less years of median annual income is needed to buy a home, housing is considered affordable. Above five and housing is considered severely unaffordable. Note that a lower index does not necessarily mean better. A very low index may be an indicator of a seriously depressed economy. A recent survey of 377 housing markets in major English-speaking countries concluded that the United States had, on average, the most affordable housing market. No surprise that Hong Kong had the least affordable housing. The index for the US was determined at 3.3 median annual incomes. In Hong Kong, the value was 13.5 median annual incomes. How would Macau fare? Unfortunately that is not so easily calculated. The Statistics and Census Service publishes quarterly estimates of median employment earned income but does not publish data for total median income. Note also, that there is no official value for the city’s median-priced dwelling. It can be roughly estimated using existing data. For the purpose of this analysis, this is probably a good enough approximation of what is actually going on. So, based on these assumptions, where would Macau find itself in the affordability survey? Based on the most recent published data, last year’s figures for residential housing transactions and the median earnings for the fourth quarter of last year, we can estimate the index value at 25.8! Moreover, that’s almost twice the size of what it was just two years before. I do not think much more needs to be said. With the cost of rental accommodation surely following a similar trajectory, the index is tantamount to a command being screamed at Macau residents: “Young, and the not-so young, men and women of Macau, go north.”
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business daily March 14, 2013
macau
3-D floor show Interblock’s hologram idea hints at a revolution in casino promotions
Scientific Games buys WMS – slot maker refocusing Macau offer
W Interblock Hologram Gaming Lounge at ICE 2013 in London
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hologram technology launched at a London gaming equipment trade show could be utilised in future for casino floor promotions. The system can create the threedimensional illusion that a real person is on a stage or a podium when in fact it’s a digital image. It can do so without requiring onlookers to be wearing 3-D glasses as they do with specially prepared cinema films. Slovenian firm Interblock – a specialist in electronic table games for casinos – has combined old technology in the form of a mirror-based illusion used in Victorian music halls and sideshows, with modern digital holographic projection. The company also had the foresight to sign what it says is an exclusive deal with the technology provider – Musion Systems Ltd, based in the United Kingdom –
when it comes to its use in the gaming industry. “The casino operator can use the hologram technology for projects in marketing or advertising as we ll a s g a m i n g , ” Ti n a F er k o , Interblock’s marketing director told our sister publication Macau Business magazine. A possible advantage of the system for casinos is that – unlike a human marketing person – a hologram never gets bored, chats to its friends or takes meal breaks. That enables a casino to repeat key marketing messages precisely and for hours at a time to an ever-changing audience on the gaming floor. Interblock says the system could be adapted to allow the hologram to interact with casino gamblers in the manner of the video screen dealers currently used in some electronic table games. I t m i g h t a l s o b e
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possible to do away with player stations and enable players to bet via computer tablet. But Davis Fong Ka Chio of the I n s t i t u t e f o r t h e S t u d y o f C o m m er ci a l Gaming at the University of Macau, told Business Daily that at present with the strength and growth of traditional gaming in the Macau market, there is probably little incentive for the authorities to experiment with hologram technology – at least on the betting side. “I think the chance [of the adoption of the technology for betting in Macau] is very low. Gross gaming revenue from traditional gaming is more than good enough now in Macau,” says Mr Fong. For more on Interblock’s hologram idea see the latest edition of Macau Business on sale now. M.G.
MS Industries – a United States-based slot machine maker – is likely to make a fresh bid for market share in Macau following its acquisition this week by Scientific Games Corp., Business Daily understands. New York-based Scientific Games – one of the world’s biggest providers of services and equipment to the regulated lottery sector – made a US$1.5 billion (12 billion patacas) offer at US$26 per share for Chicago-based WMS in late January. On Monday the deal was approved by the Federal Trade Commission in the U.S. The move must also be signed off by WMS stockholders and by gaming regulatory bodies, including the Nevada Gaming Commission, which oversees the Las Vegas market. WMS serves the gaming industry in the U.S. and international jurisdictions by designing, manufacturing and marketing games, video and mechanical reelspinning gaming machines and video lottery terminals. WMS also develops and markets digital gaming content, including online wagering and play-for-fun social, casual and mobile gaming. M.G.
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March 14, 2013 business daily | 5
MACAU New rules for profitable social service firms The registration of Macau profitable service institutions in mainland China has to be approved by civil affairs authorities starting July 1 this year, according to a statement released by the Ministry of Civil Affairs. These institutions for the aged or the disabled have to be approved by civil affairs and commerce authorities in accordance with relevant foreign investment laws, the statement said. The service providers who want to apply for service certificates must have good credibility and considerable operating capacity, as well as at least three years of service-providing experience, according to the circular.
Highest regard – Sheldon Adelson (left) says he respects Edmund Ho
Adelson never helped Edmund Ho ‘keep out of jail’ Suggestion part of ‘cunning and diabolical scheme’ by sacked Sands boss Steve Jacobs says court filing Alex Lee
alex.lee@macaubusinessdaily.com
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court deposition by former Sands China Ltd chief executive Steve Jacobs said to have suggested Sheldon Adelson wanted credit for keeping Macau’s first chief executive Edmund Ho Hau Wah “out of jail” was part of a “cunning and diabolical scheme to use the court system of Nevada to shield his [Jacobs’] campaign of defamation” states a legal filing from Mr Adelson. A seven-page deposition from the LVS chairman filed last Friday in Nevada and seen by Business Daily seeks to rebut a reported court filing on February 15 by Mr Jacobs but only recently publicised. The February 15 filing claimed Mr Jacobs had been asked by Mr Adelson to make a “threat” against Edmund Ho. The reported context was that Mr Adelson had become “enraged” at decisions made by Mr Ho in relation to LVS’s wished-for sale of apartments at the Four Seasons Macao, a company property on Cotai. According to Mr Jacobs’ filing as reported by the Wall Street Journal, he says he was ordered by Mr Adelson to remind Mr Ho that “Adelson
had settled a lawsuit paying [US]$40 million” to help Mr Ho “and that he [Ho] owed Adelson.” Mr Jacobs said he refused to carry out the order, which he considered “improper”. The WSJ report didn’t contain a suggestion – stated in Mr Adelson’s March 8 filing – that Mr Jacobs had been told to mention to Mr Ho that the LVS boss had settled the US$40 million suit “in order to keep Mr Ho out of jail”. Mr Adelson’s March 8 filing says: “I met Edmond [sic] Ho in 2002 and have come to know him well. I hold him in the highest regard, and I never asked Jacobs to inform Mr Ho that I had settled a lawsuit paying $40 million in order to keep Mr Ho out of jail. “I did not and do not have any information to suggest that Edmond Ho was ever at risk of going to jail. I know of no wrongdoing on Mr Ho’s part and Jacobs’ assertion to the contrary is another example of his willingness to disregard both the truth and the defamation laws.” Mr Jacobs first sued LVS – in a
Nevada court in October 2010 for wrongful termination after he was sacked that summer. The company says he was dismissed for “cause”. Since then the case has attracted huge publicity via court filings from Mr Jacobs that claim a succession of wrongdoings by his former employers. They include the suggestion Mr Adelson asked him to launch investigations into the backgrounds of members of the Macau government and that Mr Adelson had authorised a “prostitution strategy” at his Macau casinos. LVS and Mr Adelson strongly deny those claims.
E-mail claim Mr Jacobs also said in a court filing that an external legal advisor to Sands China, Lionel Alves – a member of Macau’s Executive Council – had sent Mr Jacobs an e-mail mentioning that an unnamed contact in China had offered to help with a business matter in Macau in exchange for US$200 million. The offer was understood to refer to the apartment sales. The allegations about the e-mail led to
investigations by the Department of Justice and the Securities and Exchange Commission in the United States over possible breaches of that country’s Foreign Corrupt Practices Act, which prohibits the bribing of overseas officials. There was no suggestion that either Mr Alves, LVS or its employees had solicited the help from the mainland go-between or that any of those people offered to make such a payment to him. Mr Jacobs’ latest filing has brought Edmund Ho directly into the wrongful termination suit. That could potentially be very damaging for LVS’s relations with the Macau and mainland authorities. Mr Ho, Macau’s first chief executive following the handover from Portuguese administration in 1999 – and a vice chairman of China’s National People’s Congress – is widely regarded as being close to China’s leaders. Anything that embarrasses him therefore could potentially also embarrass the national government. No comment was available from Mr Ho or from Mr Jacobs’ lawyers at the time Business Daily went to press.
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business daily March 14, 2013
macau
Public tender exemption fears remain: land law Some legislators are still worried about possible loopholes in the long-awaited revision Stephanie Lai
sw.lai@macaubusinessdaily.com
T
he Legislative Assembly resumed talks on the land law revision yesterday, but the discussion remained focused on the provisions allowing the government to grant land directly without public tender. Once the revised law comes into force, “public interest” projects – in particular those involving non-profit cultural, sports or social services as well as public utilities – can be exempt from public tender. The revision also states that projects that match “government policies” could be exempt as well, the head of the assembly’s first standing committee, Kwan Tsui Hang, told media. After a long meeting, the committee members and government representatives reached no agreement on a definition of “government policies”, which some members still believe to be too broad.
The land law, including the way land concessions are awarded, has remained unchanged for 30 years
“A so-called ‘government policy’ should be one that is widely discussed and recognised by the society,” said Ms Kwan.
“The examples that we see are, for instance, the industrial development plan issued by the government before the handover or the gaming
development policy that came later, which has allowed public tender exemption,” she added. “There are still concerns from the committee that the new revision would make room for people to abuse the term ‘government policy,” the legislator noted. Pro-democrat legislator Au Kam San said developers could easily dodge a public tender by claiming their projects fit the government’s aim of “diversifying the economy” or “reinforcing Macau as tourism city”. “For 13 years [since the handover], aside from about 10 plots of land granted to the gaming companies, many more land plots were given out without public tender and no proper reasons were explained to the public,” said Mr Au. With this revision, the government said it is open to requiring the developers to disclose the reasons why they want a public tender exemption, the development area and the company’s profile. The assembly also failed to reach a conclusion on the conditions for land grant renewal. The government would like to have greater in taken back vacant land with rundown or abandoned buildings, Ms Kwan said. If the developer has strayed from the plot’s original purpose or if five years have passed since the development deadline, then the grant renewal could only happen with the chief executive’s approval. The revision also states the land lease shall not exceed 25 years, and that any further renewal would last for less than 10 years.
March 14, 2013 business daily | 7
MACAU Entertainment City is expected to boost the Philippines annual gaming revenues up to US$10 billion
Philippines opens bid to challenge Macau casinos Manila Bay’s Solaire resort is seeking to attract mainland Chinese gamblers
T
he Philippines makes its biggest bet this weekend in a high-stakes bid to join the world’s elite gaming destinations, with the launch of a US$1.2-billion (9.6 billion patacas) casino on Manila Bay. Solaire Manila Resorts is the first of four enormous entertainment venues slated to rise over a giant chunk of prime, reclaimed land that industry and government leaders expect will attract millions of cashedup Asian tourists. Meanwhile, preparations are underway for the launch of the three other big-ticket casinos, which all involve major foreign backers. The four will together make up ‘Entertainment City’, located near Manila’s airport. The Belle Grande – a joint v e n t ur e w it h t h e Philip p ine s’ richest man, Henry Sy, Australian billionaire James Packer and Macau gaming tycoon Lawrence Ho Yau Lung – is slated to open next year, with its golden facade already having been built. Mr Ho’s MPEL Projects Ltd will invest at least US$650 million initially into the project and will run the resort, getting in return half of the operational profits. Japanese gambling magnate Kazuo Okada and Malaysia’s Genting Group are involved in the other two, each in partnership with local Chinese-Filipino tycoons. Both are expected to open between 2015 and 2017. But Mr Okada’s project has become mired in controversy, as his former Macau business partner Steve Wynn accused the pachinko businessman of acting improperly when he entertained Cristino Naguiat – head of state regulator Philippine
Amusement and Gaming Corp (Pagcor) – and other officials, at Wynn Macau.
Beating Las Vegas M Naguiat, who has denied any wrongdoing, told AFP he expected Philippine gaming revenues to double this year to US$2 billion because of the Solaire opening. When all four are open, Entertainment City is expected to boost the country’s annual gaming revenues up to US$10 billion, he said. While Macau counted 304.1 billion patacas in revenues last year, Mr Naguiat is confident the Philippines will eventually have one of the biggest gambling industries in the world, comparing it with the Las Vegas strip’s roughly US$6billion turnover. “We will beat Las Vegas. I’m pretty sure of that,” he said. Mr Naguiat said the casinos were mainly targeting gamblers from Asia, pointing out that Manila was a mere 3-4 hours away by plane from any point in China, Japan and South Korea, where many of the world’s high rollers live. “Actually it’s a no-brainer. The big market is here in Asia,” he said. Mr Naguiat said that to make it easier for the foreign gamblers, a skyway roadlink to Manila airport is due to open in two years that will allow them to avoid the city’s notorious gridlock and reach Entertainment City in just five minutes. The government has further sweetened the offer by taking just 27 percent in taxes off winnings for normal gamblers, compared with Macau’s 40 percent, according to Mr Naguiat. High rollers have it even
better, with winnings taxed at just 15 percent.
Returning talent Mr Naguiat said he saw Entertainment City as the key to the government’s ambitious bid to attract 10 million tourists a year and create more jobs in a country where a fourth of the workforce is unemployed or underemployed. About 4.6 million tourists visited the country last year, compared with about 14 million for Singapore and 28 million for Macau. He said Entertainment City should easily employ 40,000 Filipinos when all four venues are open. About 400 Filipino expatriates were hired to work at Solaire, including Filipino dealers and pit bosses from casinos in Macau and Singapore who were given managerial posts. Last year Solaire’s developer Bloomberry Resorts Corp said it was particularly keen on hiring Filipinos working in Macau due to their knowledge of the Chinese punter. However the casinos are stirring controversy in the mainly Roman Catholic nation, with critics saying the government’s embrace of gambling to solve the country’s financial woes is a dangerous signal. Earlier this month an international body responsible for improving the global fight against money laundering criticised the Philippines government for exempting its casino industry from new, tighter financial oversight. Lawmakers have said they will end the exemption, introduced at the request of Pagcor, but that’s unlikely to come in time for the soft opening of Solaire. With AFP
Solaire seeking glamour “What Solaire brings is an entertainment and gaming experience that doesn’t exist in the Philippines today,” Solaire Manila Resorts chief operating officer, Michael French, told AFP in an interview this week ahead of Saturday’s opening. “It will be like going to Las Vegas. This raises the scale, the excitement and the... glamour.” Controlled by billionaire Philippine port operator Enrique Razon, Solaire has 300 gaming tables, 1,200 slot machines and seven restaurants. The building also has 500 hotel rooms and 2,000 parking slots. It features glass ceilings filtering abundant tropical sunlight, huge chandeliers, thick red-themed carpets, blown glass wall-to-ceiling panels, water pools and an army of cocktail waitresses in tiny red dresses. Another wing is being built to add 300 all-suite hotel rooms, 30-40 high-end shops and a theatre where Mr French plans to host travelling Broadway shows as well as local and foreign lounge acts.
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business daily March 14, 2013
GREATER CHINA
Beijing rising rents squeeze newco Harsh restrictions hit migrant workers barred from buying homes
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eijing’s strictest-in-the-nation property curbs are forcing up rents for about 7.7 million residents originally from outside of the city who are blocked from buying a home. The Chinese capital requires new arrivals to wait five years before purchasing a house, while cities including Shanghai permit ownership after one year of residency. Beijing introduced restrictions on non-locals in 2011, followed by about 40 other cities, part of a three-year, largely unsuccessful campaign by the central government to contain the growth of property prices. Average rents in the capital have jumped 23 percent since 2010, while demand for rentals surged 82 percent as migrant workers and graduates poured into the city, according to data from broker Bacic & 5i5j Group. Beijing’s home prices climbed 4.9 percent in the same period, according to real estate website owner SouFun Holdings Ltd. Increasingly unaffordable rents are frustrating residents like Adam Wang, 27, who moved to Beijing four years ago and won’t be allowed to buy a home until November. “Many friends of mine are in the same situation like me, but what else can we do?” said Mr Wang, a manager at a technology company who relocated from Xinjiang province in western China. “We can’t really leave Beijing, because after all, there are more opportunities in big cities where we’ve already established some networks.”
Rent on Mr Wang’s onebedroom apartment near the east end of the central business district surged almost 20 percent to 5,000 yuan (US$802) a month in the past two years.
Deepen xenophobia As many as 30 percent of tenants living in rented apartments in Beijing and Shanghai, the nation’s financial hub, can’t buy a home due to government restrictions, according to Centaline Property Agency Ltd., China’s biggest real estate brokerage. The rules are unfair and will deepen xenophobia toward non-locals, said Wang Zhenyu, a Beijing-based lawyer and deputy director of a policy research centre at China University of Political Science and Law. Beijing in 2011 limited local residents to owning two homes, while non-locals may buy one after meeting the residency requirements. Still, the market is rising, with Beijing home prices up 1.6 percent in January from December, the bureau of statistics said February 22. “Home purchase restrictions have accelerated gains in rents,” said Qu Anxin, a Shanghai-based senior manager at Centaline. “Rents will keep climbing, and probably at a faster pace this year than in 2012, especially after the government’s new curbs.” The resulting squeeze on nonlocal’s rental costs has prompted some to skirt the law with fake divorces or
People wait in line for the chance to buy a home in the Chinese capital
marriages, and forged documents to get around the purchase restrictions. “The government should increase the supply of public rental homes and establish a long-term rental system in
BHP Billiton faces Beijing Olympics corruption probe Media report says allegations include gifts to Chinese officials Sonali Paul and Lucy Hornby
the private market,” said Shen Jianguang, a Hong Kong-based economist at Mizuho Securities Asia Ltd. The government announced in 2011 that it planned to build 36
Department told Fairfax, in response to a freedom of information request, it was conducting “law enforcement proceedings” involving BHP, which supplied the materials for gold, silver and bronze medals used in Beijing. Australian police confirmed they had been working with foreign counterparts and local regulators on Australian aspects of the United States investigation, without providing further details. BHP said it had been cooperating with “relevant authorities”, and in response to media queries said it believed it had complied with all applicable laws in regards to its Olympics sponsorship. “BHP Billiton is fully committed to operating with integrity and the Group’s policies specifically prohibit engaging in bribery in all its forms,” BHP said in an emailed statement. The world’s biggest mining company has been under investigation for possible corrupt practices since at least 2009, disclosing in 2010 that it had uncovered possible violations of some anti-corruption laws.
Govt hospitality
Mining giant is being probed for its sponsorship of the 2008 Beijing Olympics
T
he United States government is investigating top global miner BHP Billiton Ltd for possible corrupt practices, the company confirmed, after media reports said it
was being probed for its sponsorship of the 2008 Beijing Olympics. Australia’s Fairfax Media reported that the United States Department of Justice and the Australian Federal
Police were investigating allegations that BHP provided inducements, hospitality and gifts to Chinese and other foreign officials. The United States Justice
BHP said yesterday it could not comment on whether that investigation had been expanded or whether the probe referred to yesterday was separate. Fairfax reported that between 2000 and 2008, BHP spent millions of dollars on a major Olympics sponsorship deal and hospitality package which according to a former China staffer involved more than 170 VIPs, including senior government officials and Chinese steel and mineral company chief
March 14, 2013 business daily | 9
GREATER CHINA
omers
First commercial trip through Arctic shortcut this summer Oil and gas exploration and mining businesses are also being drawn to the region
Audi’s smallest sedan heads to China in 2014
Alister Doyle
A
million units of social housing by next year, with a large number of these homes rented out based on income limits. Bloomberg News
executive officers. Unlike most major consumerfocused sponsors, BHP’s involvement at the 2008 Beijing Olympics was targeted mostly at its close circle of Chinese buyers and employees. “Most sponsorships focus on media buys and advertising. We’ve done almost none,” Maria McCarthy, the head of BHP’s Olympic sponsorship team, told Reuters in March 2008. “Instead, we are focusing on community leveraging, stakeholder leveraging that involves governments and customers, and our staff,” she said. A former BHP employee involved in the Olympics arrangements told Reuters the company had gone out of its way to comply with Australian rules and should have extensive documentation to share with investigators, if needed. In 2010, after receiving questions from the U.S. Securities and Exchange Commission, BHP said it had discovered possible violations of anti-corruption laws mainly related to some exploration projects that it had already terminated at the time. It said then that the commission’s requests for information did not relate to any activity in China or any of BHP’s sales and marketing activities.
Chinese shipping firm is planning the country’s first commercial voyage through a shortcut across the Arctic Ocean to the United States and Europe in 2013, a leading Chinese scientist said on Tuesday. Yang Huigen, director general of the Polar Research Institute of China, told Reuters that the trip he led last year on the icebreaker Xuelong, or Snowdragon, to explore the route had “greatly encouraged” Chinese shipping companies. “One commercial voyage by a Chinese shipping company may take place this summer,” he said. For China, the world’s second economy after the United States, the route would save time and money. The distance from Shanghai to Hamburg is 2,800 nautical miles (5,185 kms) shorter via the Arctic than via the Suez Canal, Mr Yang said. Despite ice risks on a route that is opening because of climate change, shipping as well as oil and gas exploration and mining businesses are being drawn to the Arctic region. Mr Yang showed delegates at a conference about the Arctic in Oslo organised by The Economist magazine longer-term scenarios under which between five and 15 percent of China’s international trade, mostly container traffic, would
use the route by 2020. Ten percent of China’s projected trade by 2020, for instance, would be worth US$683 billion, he said. Ice on the Arctic Ocean shrank to a record low last September since satellite observations began in the 1970s. Many experts expect it will vanish in summers by mid-century due to climate change caused by human emissions of greenhouse gases. “We see a potential there but it will not be the new Suez Canal,” said Christian Bonfils, managing director of Denmark-based Nordic Bulk Carriers. “You will not see a boom in the construction of ice-class vessels - the season is too short,” he said of a shipping season that lasts from about July to November, referring to ships needing specially hardened hulls. Sergei Frank, head of Russia’s Sovcomflot shipping company, said that there had been a steady gain in the numbers of vessels using the route in recent years. “We expect a small rise this year,” he said. The thaw will also make it easier to reach remote regions in the Arctic, without crossing from the Pacific to the Atlantic. That could mean more tourism on cruise ships and access to coastal communities and minerals.
Volkswagen AG’s Audi brand next month will unveil its smallest sedan, a version of the A3 compact, at the Shanghai Auto Show and will begin selling the car in early 2014. Audi chief executive officer Rupert Stadler on Tuesday said the car will be “an important derivative which will stimulate additional growth, especially in China and the United States”. Chinese press reports have said the A3 sedan will be assembled locally next year by the FAW-VW joint venture that builds a variety of Audi models.
Beijing eases one-child policy in some areas China is allowing couples in seven regions to have a second child if one of the parents has no siblings, easing population-control measures in place for more than three decades, according to a state-controlled newspaper. The exception to China’s one-child policy has started being applied to rural and urban residents of seven regions including the city of Shanghai and the provinces of Zhejiang and Heilongjiang, Renmin Zhengxie Bao reported yesterday. It cited Wang Pei’an, vice minister of the family planning commission.
Reuters
Hangzhou searching for ‘modern Marco Polo’ Hangzhou is searching for a foreign traveller to become a “modern Marco Polo”, with a 40,000 euro (US$52,000) salary on offer to the winner, a tourism official said yesterday. The Zhejiang capital, renowned for its canals and bridges, was described as the “most beautiful and elegant city in the world” by the Venetian traveller. The new Marco Polo will be recruited via Facebook and will undergo intensive training before being flown to the city for a 15-day trip. Duties include making a short video about Hangzhou and promoting the city online.
Cathay Pacific says 2012 net profit slumped
Reuters
BHP Billiton is fully committed to operating with integrity Ice on the Arctic Ocean shrank to a record low last September
Cathay Pacific said yesterday 2012 net profit plunged 83.3 percent, even though revenue rose one percent, as the Hong Kong flag carrier was hit by persistently high fuel prices and weak air cargo demand. Cathay said it carried a total of 29 million passengers in 2012, a fivepercent rise year on year, but its premium class business was affected by travel restrictions imposed by companies. “The high cost of fuel made it more difficult to operate profitably, particularly on long-haul routes operated by older, less fuel-efficient aircraft,” chairman Christopher Pratt said.
10 |
business daily March 14, 2013
ASIA
South Korea readies stimulus as jobless grow Analysts expect central bank to cut interest rate to growth in Asia’s fourth-largest economy
S
outh Korea plans to implement an economic stimulus package but will set the details around the end of this month after examining first-quarter indicators, a senior official at the presidential Blue House told Reuters yesterday. “We will take action, that is for certain,” the official, who declined to be identified, said by telephone. “But what goes on the menu and the strength of the items to be included need to be considered further, and that will be decided once we get the first-quarter indicators around the end of March.” The comments are in line with market expectations that president Park Geun-hye will seek to boost growth. But the Blue House official did not say whether the government will seek more central spending or look to other measures such as tax breaks. Overseas shipments for the world’s seventh-largest exporter barely grew in the first two months of the year while domestic consumption remains depressed, raising concerns that growth will continue to stagnate in coming quarters. Hyun Oh-seok, nominated as the next finance minister, told lawmakers at a confirmation hearing yesterday that short-term measures are needed to boost the economy. “There are several policy packages that could be tapped,” said Mr Hyun. “There needs to be a comprehensive review of options, including fiscal [spending], interest rates and property market measures.” Investors have been betting on a
New South Korean president Park Geun-hye has pledged to boost growth
rate cut at the Bank of Korea’s ratesetting meeting today, with yields on three-year and five-year government bonds having closed well below the benchmark rate of 2.75 percent. The land ministry is also expected to announce another policy package sometime between end-March and early April in a bid to boost the ailing property market. Data from Kookmin Bank showed
that housing prices across South Korea fell for the eighth consecutive month in February, underscoring the mounting pressures on local households, which typically count their home as the most valuable asset. The country’s jobless rate rose to a one-year high in February, state data showed yesterday, as more university graduates flooded onto the market.
The seasonally adjusted jobless rate of 3.4 percent was the highest since the 3.7 percent posted in February 2012, and up from 3.2 percent in January. Among those aged 25 to 29, the rate was a relatively high 8 percent compared with 6.4 percent in January as most graduates start their job searches in February. Reuters / AFP
Singapore Exchange tightens grip on Asian markets Deals with South Korea and Philippine bourses announced
S
ingapore Exchange Ltd (SGX) has announced two new tieups with other Asian bourses and disclosed plans for a number of new trading products as it tries to strengthen its position as the region’s top exchange for derivatives. Southeast Asia’s largest exchange said it has signed a deal with Korea Exchange to explore how they can collaborate on derivative clearing services, a move that comes as Asian countries grapple with how to bring in global reforms to the over-thecounter swaps markets. The two bourses said they were looking at possible ways their users could take advantage of each others’ facilities for over-the-counter derivatives clearing. Regulatory reforms around the world are trying to push the trillions
of dollars in over-the-counter derivatives that are traded every day to be centrally cleared to try to reduce the level of risk they pose to the financial system. Half a dozen Asian exchanges have launched, or are launching, clearing houses, leading to concerns there will be too many such facilities in the region. While the region has some of the world’s fastest growing economies, its derivatives markets are still a fraction of the size of those in Europe and London. The release was one of a number of announcements Singapore Exchange made at a derivatives industry conference in Boca Raton in Florida. It also said it has signed an agreement with the Philippine Stock Exchange to develop derivative products together.
Singapore is planning to launch a Philippines index futures contract
Singapore is planning to launch a Philippines index futures contract, based on the benchmark MSCI Philippines index, by the fourth quarter of this year.
The Philippines has the best performing stock market so far in Southeast Asia this year, rising nearly 17 percent. Reuters
March 14, 2013 business daily | 11
ASIA
Iwata gains traction for Bank of Japan post Close-call election for deputy governor nominee, who defends aggressive economic stimulus Toru Fujioka and Takashi Hirokawa
Toyota approves biggest bonus in five years
T
wo opposition parties said they will support Kikuo Iwata for Bank of Japan (BOJ) deputy governor, reducing the risk that prime minister Shinzo Abe will fail to win confirmation for all three of his central bank nominees. The endorsements put Mr Iwata above the threshold needed to win confirmation in the upper house of parliament, provided lawmakers follow their party’s recommendations. The main opposition Democratic Party of Japan (DPJ) on Tuesday said it would vote against Mr Iwata while supporting Haruhiko Kuroda as central bank governor and Hiroshi Nakaso for the other deputy post. Mr Abe needs opposition lawmakers to secure the new central bank leadership team, as the ruling coalition lacks an upper house majority. A rejection of Mr Iwata, 70, who has advocated greater monetary stimulus since the 1990s, may reduce the number of Bank of Japan board votes in favor of greater asset purchases as Mr Kuroda presses for more easing. “It could be a close call depending on whether the DPJ takes a unified stance against Mr Iwata or allows individual members to vote as they wish,” Kyohei Morita, chief Japan economist at Barclays Plc in Tokyo, wrote in a note to clients Tuesday. “We believe any stance that causes gridlock and delay could leave the DPJ vulnerable to public criticism ahead of this summer’s
Toyota Motor Corp approved the biggest salary bonus in five years as the world’s largest automaker projects the highest profit since 2008 and as an export-driven industrial recovery drives rivals’ pay higher. Toyota agreed to a union proposal for a 2013 average bonus of about 2.05 million yen (US$21,375), compared with 1.77 million yen in 2012, the company said yesterday. The automaker paid a 2.51 million yen bonus in 2008, according to the Japan Automobile Workers’ Union. Japanese manufacturers are recovering after earthquakes and a tsunami in Japan and floods in Thailand disrupted output.
Japan’s chronic deflation, population ageing is hurting the country’s economy
upper house election.” While all three nominees are assured of passing the lower house, they need 118 votes to be confirmed in the upper house. Mr Abe’s Liberal Democratic Party and coalition partner New Komeito have a combined 102 seats, while the DPJ has 87. The Your Party, with 12 upper house legislators, and the Japan Restoration Party, with three, yesterday endorsed Iwata and rejected Mr Nakaso, while splitting on Mr Kuroda. The New Renaissance Party, which is comprised of two upper house lawmakers, last month
said it would back all three of Mr Abe’s candidates. The lower house will vote on the nominations today, while the upper house will vote tomorrow. Mr Iwata, a professor at Tokyo’s Gakushuin University, has called for revising the law governing the central bank to give the government more say in setting policy goals. “His views on changing the BOJ law, especially allowing for firing people, is a complete violation of the BOJ’s independence,” DPJ policy chief Mitsuru Sakurai said Tuesday. “Iwata is unacceptable as deputy governor.”
A
measure of Australian consumer confidence rose for a third straight month in March as people grew more upbeat about the economic outlook and their own finances, suggesting lower interest rates were working to revive demand. The poll of 1,200 people by the Melbourne Institute and Westpac Bank showed its index of consumer sentiment climbed 2 percent in
Nippon Steel & Sumitomo Metal Corp, the world’s second steelmaker by output, will mothball the third blast furnace at its Kimitsu steel mill, east of Tokyo, around March 2016 to lower costs. That would mark the first crude steel capacity cutback since the company was formed by a merger of two Japanese steel majors last October. The steelmaker will also delay indefinitely the startup of a second blast furnace at its Wakayama steel mill in western Japan, the company said in its mid-term business plan.
Bloomberg News
Samsung promises more pressure on IPhone
Australia consumer confidence hits 2-year high Consumers feeling better about their own finances, more willing to spend
Nippon Steel to mothball blast furnace
Samsung Electronics Co is making its biggest run yet at the iPhone’s United States loyalists, unveiling the new Galaxy S4 a few blocks from Apple Inc’s flagship store in New York today and broadcasting the event live in Times Square. The South Korean company is relying on an advertising blitz and cuttingedge features, potentially including a snazzier camera and eye-tracking capabilities, to generate the kind of buzz associated with Apple’s products. Samsung became the smartphone leader worldwide more than a year ago, according to IDC. Apple still remains No. 1 in the United States.
March, on top of February’s steep 7.7 percent jump. It was also up a healthy 15.1 percent on March last year. The index of 110.5 was the highest since December 2010 and meant optimists increasingly outnumbered pessimists in the poll. Details of the survey showed a further pick up in the economic outlook. The index of expectations for the economy in the next 12 months rose by 0.8 percent, to be up almost 24 percent for the year. The measure for the economy over the next five years increased by 6 percent in March.
People were also feeling better about their own finances. The index of family finances compared with a year ago rose 3.9 percent, while that for finances over the next 12 months increased by 3.1 percent. And they seemed more willing to spend. The index of whether it was a good time to buy a home was up almost 20 percent on March last year, while that for new vehicles was 17 percent higher. The only dip came in the survey’s measure of whether it was a good time to buy a major household item, which fell 1.6 percent, but that was from a historically high level. Reuters
Carlyle, CVC said to weigh Thai Life stake Carlyle Group LP, CVC Capital Partners Ltd and KKR & Co are among firms that have made preliminary offers for a minority stake in Thai Life Insurance Pcl, according to people with knowledge of the matter. The unlisted Thai insurer, controlled by the Chaiyawan family, is selling a 20 percent stake valued at about US$500 million, two people said. Japanese insurers Meiji Yasuda Life Insurance Co and Sumitomo Life Insurance Co have also expressed interest, one person said. The purchase could potentially be the largest by a private equity firm in Thailand.
12 |
business daily March 14, 2013
MARKETS Hang SENG INDEX NAME
PRICE
DAY %
VOLUME
AIA GROUP LTD
33.9
-0.877193
31644955
ALUMINUM CORP-H
3.17
-1.857585
9115638
BANK OF CHINA-H
3.56
-2.73224
440506860
BANK OF COMMUN-H
5.81
-2.188552
47440115
BANK EAST ASIA
31.1
-1.644529
3573563
BELLE INTERNATIO
14.92
-0.1338688
20060594
BOC HONG KONG HO
26.55
-0.3752345
8758227
CATHAY PAC AIR CHEUNG KONG CHINA COAL ENE-H CHINA CONST BA-H
NAME
PRICE
DAY %
Volume
CHINA UNICOM HON
10.72
-2.367942
37777035
POWER ASSETS HOL
CITIC PACIFIC
10.38
-2.259887
13411615
66.3
-0.748503
6220113
CLP HLDGS LTD
PRICE
DAY %
Volume
71
-0.9762901
3227684
SANDS CHINA LTD
35.8
-0.4172462
7647349
SINO LAND CO
13.4
-4.829545
14578969
CNOOC LTD
14.44
-1.500682
53208831
SUN HUNG KAI PRO
111.6
-1.803784
8674628
COSCO PAC LTD
11.66
-4.738562
13365634
SWIRE PACIFIC-A
100.3
-1.084813
1932422
9.32
-3.719008
13461395
TENCENT HOLDINGS
278.2 -0.07183908
3905104
30.35
-0.1644737
5335988
TINGYI HLDG CO
21.05
-0.7075472
5584000
11.48
-0.173913
17322300
65.1
-1.661631
4297823
ESPRIT HLDGS HANG LUNG PROPER
14.2
-0.4207574
6447707
HANG SENG BK
128.4
-0.8494208
1312721
WANT WANT CHINA
116.8
-0.5110733
4275670
HENDERSON LAND D
51.25
-0.6782946
3375639
WHARF HLDG
7.22
-2.432432
24916229
HENGAN INTL
78.45
-0.4441624
1516473
HONG KG CHINA GS
21.95
-0.9029345
8802536
HONG KONG EXCHNG
135.7
-1.595359
5156138
84
-0.8849558
12843374
83.35
-0.8328376
5375535
5.37
-2.185792
256020955
6.2
-2.66876
307388820
CHINA LIFE INS-H
22.1
-1.995565
49453987
CHINA MERCHANT
26.45
-2.398524
3417586
CHINA MOBILE
HSBC HLDGS PLC
83.15
-1.129608
18694578
HUTCHISON WHAMPO
CHINA OVERSEAS
21.6
-3.139013
25784021
IND & COMM BK-H
CHINA PETROLEU-H
8.75
-1.90583
77455664
LI & FUNG LTD
10.96
0.1828154
18556189
MTR CORP
31.55
-1.251956
4428240
CHINA RES ENTERP
NAME
MOVERS
49
0 23230
INDEX 22556.65 HIGH
23224.44
LOW
22534.94
24.5
-2
2277386
20.35
-4.009434
18982469
NEW WORLD DEV
14.02
-0.7082153
20316920
CHINA RES POWER
20.4
-3.087886
7918077
PETROCHINA CO-H
10.68
-1.476015
64223455
CHINA SHENHUA-H
29
-2.192243
16881389
PING AN INSURA-H
62.1
-1.662708
19429945
PRICE
DAY %
Volume
25.95
-4.243542
19979683
YANZHOU COAL-H
8.75
-1.90583
77455664
CHINA RES LAND
1
52W (H) 23944.74 (L) 18056.4
22530
11-March
13-March
Hang SENG CHINA ENTErPRISE INDEX NAME
NAME
PRICE
DAY %
VOLUME
AGRICULTURAL-H
3.82
-2.051282
142728199
AIR CHINA LTD-H
6.33
-1.860465
5501483
CHINA PETROLEU-H
ALUMINUM CORP-H
3.17
-1.857585
9115638
CHINA RAIL CN-H
7.3
-5.562743
ANHUI CONCH-H
26.75
-2.193784
14945497
CHINA RAIL GR-H
3.95
BANK OF CHINA-H
3.56
-2.73224
440506860
CHINA SHENHUA-H CHINA TELECOM-H
CHINA PACIFIC-H
PRICE
DAY %
Volume
11.28
-1.74216
22809110
ZIJIN MINING-H
2.55
-1.544402
46978276
37272368
ZOOMLION HEAVY-H
9.21
-5.344296
31874993
-3.186275
46009526
ZTE CORP-H
13.6
1.644245
7064376
29
-2.192243
16881389
5.81
-2.188552
47440115
3.99
-1.237624
50948703
26.45
-3.467153
3863020
DONGFENG MOTOR-H
10.74
-1.648352
14815833
CHINA CITIC BK-H
4.65
-2.719665
63146364
GUANGZHOU AUTO-H
6.25
-2.190923
8545680
CHINA COAL ENE-H
7.22
-2.432432
24916229
HUANENG POWER-H
7.71
-0.516129
15478780
CHINA COM CONS-H
6.84
-3.389831
28215284
IND & COMM BK-H
5.37
-2.185792
256020955
CHINA CONST BA-H
6.2
-2.66876
307388820
JIANGXI COPPER-H
17.38
-1.696833
10540206
CHINA COSCO HO-H
4.05
-0.7352941
12771315
PETROCHINA CO-H
10.68
-1.476015
64223455
CHINA LIFE INS-H
22.1
-1.995565
49453987
PICC PROPERTY &
10.82
-1.457195
15335162
CHINA LONGYUAN-H
6.44
-1.075269
18661556
PING AN INSURA-H
62.1
-1.662708
19429945
CHINA MERCH BK-H
16.62
-2.004717
18688967
SHANDONG WEIG-H
7.61
0.928382
20578000
BANK OF COMMUN-H BYD CO LTD-H
CHINA MINSHENG-H
10.36
-2.448211
49993429
SINOPHARM-H
25.9
-0.5758157
CHINA NATL BDG-H
11.38
-3.231293
41466232
TSINGTAO BREW-H
49.5
-0.9009009
3986451 1695900
CHINA OILFIELD-H
15.42
-1.40665
5917107
WEICHAI POWER-H
24.95
-9.601449
13331278
NAME
MOVERS
1
39
0 11540
INDEX 11037.41 HIGH
11538.34
LOW
11037.41
52W (H) 12354.22 (L) 8987.76
11030
11-March
13-March
Shanghai Shenzhen CSI 300 PRICE
DAY %
VOLUME
PRICE
DAY %
Volume
PRICE
DAY %
Volume
AGRICULTURAL-A
2.8
-0.7092199
137056845
CITIC SECURITI-A
13.21
-2.437223
97502089
SANY HEAVY INDUS
10.56
-2.131603
24225811
AIR CHINA LTD-A
5.3
-2.394107
13845625
CSR CORP LTD -A
4.44
-3.687636
45859733
SHANDONG DONG-A
48.6
-0.7758269
4203969
4.63
0
24315540
DAQIN RAILWAY -A
7.5
-0.6622517
29091634
SHANDONG GOLD-MI
34.02
0.5022157
6002396
17.46
-3.107658
22745511
DATANG INTL PO-A
43669154
EVERBRIG SEC -A
NAME ALUMINUM CORP-A ANHUI CONCH-A BANK OF BEIJIN-A
9.13
0
NAME
NAME
4.45
-1.982379
17542908
SHANG PHARM -A
12.56
-2.104443
9111317
13.48
-3.16092
18973845
SHANG PUDONG-A
10.25
-0.3887269
105764431
BANK OF CHINA-A
2.92
-1.016949
20198460
GD POWER DEVEL-A
2.95
-1.337793
70931837
SHANGHAI ELECT-A
4.22
-0.9389671
18712667
BANK OF COMMUN-A
4.69
-0.6355932
42057431
GF SECURITIES-A
14.2
-1.045296
33197165
SHANXI LU'AN -A
18.43
0.7103825
17806122
BANK OF NINGBO-A
10.69
-0.09345794
12229779
GREE ELECTRIC
26.71
-2.340037
13081902
SHANXI XINGHUA-A
41.33
2.581286
5596391
BAOSHAN IRON & S
4.89
-0.6097561
31941070
GUANGHUI ENERG-A
19.29
-0.9753593
12031689
SHANXI XISHAN-A
12.28
0.8210181
10659186 43813058
23.04
-0.7324429
2977116
HAITONG SECURI-A
11.18
-2.697998
100325425
SHENZEN OVERSE-A
5.77
-3.02521
CHINA CITIC BK-A
4.44
-1.113586
11041235
HANGZHOU HIKVI-A
35.79
2.992806
4616573
SICHUAN KELUN-A
64.21
-1.351974
906526
CHINA CNR CORP-A
4.33
-4.835165
63661060
HENAN SHUAN-A
71.02
-1.770401
1309292
SUNING APPLIAN-A
6.23
-2.65625
54017584
CHINA COAL ENE-A
7.26
0.137931
8643549
HONG YUAN SEC-A
18.84
-1.257862
11912009
TASLY PHARMAC-A
65.74
0.1370906
2417991
10.32
-1.901141
39757917
TSINGTAO BREW-A
35.97
-0.221914
1362969
BYD CO LTD -A
CHINA CONST BA-A
4.57
0
25516640
HUATAI SECURIT-A
CHINA COSCO HO-A
4.09
-1.918465
11740081
HUAXIA BANK CO
10.31
0.09708738
27117760
WEICHAI POWER-A
21.9
-4.073587
9345086
CHINA EAST AIR-A
3.22
-2.12766
11180983
IND & COMM BK-A
4.13
0
36675449
WULIANGYE YIBIN
24.34
0.2884219
14646691
CHINA EVERBRIG-A
3.17
-1.552795
88490667
INDUSTRIAL BAN-A
18.53
-0.1078167
77121556
YANGQUAN COAL -A
13.76
1.624815
13319493
CHINA INTL MAR-A
12.87
-3.450863
6580758
INNER MONG BAO-A
30.82
1.348241
32871740
YANTAI WANHUA-A
16.11
-0.983405
5828189
CHINA LIFE INS-A
17.16
-2.389078
17689012
INNER MONG YIL-A
28.17
-2.828562
7791796
YANZHOU COAL-A
17.69
-0.5621135
5997552
CHINA MERCH BK-A
12.67
-1.782946
65982796
INNER MONGOLIA-A
5.1
-0.5847953
51219132
YUNNAN BAIYAO-A
75.22
-0.05314908
1302871
CHINA MERCHANT-A
13
-3.703704
42281595
JIANGSU HENGRU-A
32.29
-0.5543579
2948468
ZHONGJIN GOLD
14.96
0.1338688
13615418
CHINA MERCHANT-A
24.12
-3.52
15792322
JIANGSU YANGHE-A
76.82
0.8930917
2764171
ZIJIN MINING-A
3.55
-0.5602241
54734066
JIANGXI COPPER-A
23.28
-0.4702864
13322810
ZOOMLION HEAVY-A
8.38
-2.444703
53334287
JINDUICHENG -A
12.47
1.299756
41117211
ZTE CORP-A
11.05
-2.985075
37372527
JIZHONG ENERGY-A
13.39
0.3748126
17932632
CHINA MINSHENG-A CHINA NATIONAL-A
9.78
0.4106776
243176536
8.27
-3.613054
30557273
CHINA OILFIELD-A
16.82
1.447527
9165359
CHINA PACIFIC-A
18.74
-1.781971
14967048
KANGMEI PHARMA-A
15.81
0.4447268
21344358
7.47
0
62391721
KWEICHOW MOUTA-A
183.83
0.9056977
3076990
30.74
-0.1948052
5391774
CHINA PETROLEU-A CHINA RAILWAY-A
5.15
-5.677656
49499778
LUZHOU LAOJIAO-A
CHINA RAILWAY-A
2.89
-3.986711
51587120
METALLURGICAL-A
2.06
-0.4830918
19153277
CHINA SHENHUA-A
21.82
-0.7730787
14698118
NINGBO PORT CO-A
2.48
-1.195219
10749723
3.5
2.339181
82865285
CHINA SHIPBUIL-A
5.08
-1.930502
48991802
PANGANG GROUP -A
CHINA SOUTHERN-A
3.64
-1.886792
13296645
PETROCHINA CO-A
8.86
-1.116071
21707811
22.09
1.703499
MOVERS
71
213
16 2620
INDEX 2527.486
CHINA STATE -A
3.48
-1.416431
77250289
PING AN BANK-A
83690151
HIGH
2615.33
CHINA UNITED-A
3.37
-1.749271
69340593
PING AN INSURA-A
42.63
-1.433526
29128217
LOW
2515.89
CHINA VANKE CO-A
10.95
-2.406417
64584652
POLY REAL ESTA-A
11.14
-3.799655
50699688
CHINA YANGTZE-A
7.13
-0.4189944
17546155
QINGDAO HAIER-A
11.99
-1.801802
9037948
CHONGQING CHAN-A
8.69
-2.029312
27103557
QINGHAI SALT-A
27.39
-1.154818
4225421
CHONGQING WATE-A
6.46
-0.1545595
15357249
SAIC MOTOR-A
15.22
-3.119032
24851960
PRICE DAY %
Volume
PRICE DAY %
Volume
52W (H) 2791.303 (L) 2102.135
2510
11-March
13-March
FTSE TAIWAN 50 INDEX NAME
NAME
ACER INC
27.2
-1.090909
13658090
FORMOSA PLASTIC
ADVANCED SEMICON
24.8 -0.4016064
16177187
FOXCONN TECHNOLO
ASIA CEMENT CORP
36.55
0.1369863
ASUSTEK COMPUTER
345
AU OPTRONICS COR
13.3
CATCHER TECH
3990580
FUBON FINANCIAL
-1.988636
2742533
-2.205882
105352829
130 -0.7633588
CATHAY FINANCIAL
40.95
CHANG HWA BANK CHENG SHIN RUBBE CHIMEI INNOLUX C
5624057
73.5
-2.649007
11404706
81 -0.9779951
4598416
HON HAI PRECISIO
80
-0.621118
29143039
HOTAI MOTOR CO
242
0
270126
241
-3.984064
20401910
17.55
0.862069
7954548
YUANTA FINANCIAL YULON MOTOR CO
HTC CORP
0.9864365
38148550
HUA NAN FINANCIA
17.7
1.432665
27046902
LARGAN PRECISION
740 -0.2695418
1523204
82.9
-1.893491
6246423
LITE-ON TECHNOLO
45.8 -0.4347826
5659729
110467611
352.5 -0.7042254
5934817
0
44062154
MEGA FINANCIAL H
24.8 -0.4016064
24494321
CHINA STEEL CORP
27.1 -0.5504587
18417662
NAN YA PLASTICS
56.1
MEDIATEK INC
-3.442341
5469177
18.15
0.2762431
31878355
PRESIDENT CHAIN
166 -0.8955224
92.7
0.1079914
4512318
QUANTA COMPUTER
66.2
0.6079027
10139776
20.65
-1.900238
16196634
SILICONWARE PREC
34.05
1.038576
11450360
119
6.726457
7473049
SINOPAC FINANCIA
14.05 -0.3546099
24192504
FAR EASTERN NEW
32
-1.081917
6196236
SYNNEX TECH INTL
59.1 -0.1689189
2153210
FAR EASTONE TELE
69.9
0.4310345
5480815
TAIWAN CEMENT
38.5
0.9174312
3309613
FIRST FINANCIAL
595 -0.3350084
TSMC
1.933702
COMPAL ELECTRON
TPK HOLDING CO L
34205338
8.92
DELTA ELECT INC
105
0.5938242
18.45
CHUNGHWA TELECOM
PRICE DAY %
TAIWAN MOBILE CO
42.35
CHINA DEVELOPMEN CHINATRUST FINAN
NAME
709383
18.75
-0.530504
16094627
17.05 -0.2923977
6220008
FORMOSA CHEM & F
74
-1.986755
3892294
TAIWAN FERTILIZE
72.1 -0.5517241
4617557
FORMOSA PETROCHE
83.1
-1.071429
1783801
TAIWAN GLASS IND
29.1
TAIWAN COOPERATI
0.6920415
826192
0.9615385
Volume 5568217 2689661
104.5
1.95122
UNI-PRESIDENT
59.6
1.188455
9427043
UNITED MICROELEC
11.1 -0.8928571
31908364
WISTRON CORP
MOVERS
33.1 -0.7496252 15.55
18
30
5617.06
LOW
5550.33
9119211
0.974026
12404517
55.7 -0.3577818
3466031
2 5620
INDEX 5574.41 HIGH
57605306
52W (H) 5639.93 (L) 4719.96
5550
11-March
13-March
March 14, 2013 business daily | 13
MARKETS GAMING STOCKS - DAILY PERFORMANCE (Hong Kong Stock Exchange)
Max 31.25
average 31.037
Min 30.75
31.30
53.80
17.00
31.15
53.45
16.85
31.00
53.10
16.70
30.85
52.75
16.55
30.70
Last 31.15
Max 53.8
average 52.983
Min 52.4
Last 52.65
52.40
Max 16.92
average 16.620
Min 16.5
16.40
Last 16.6
18.4
36.4 36.1
21.2 21.1
18.2
35.8
21.0 18.0
35.5
Max 36.3
average 35.945
Min 35.4
35.2
Last 35.8
Max 18.34
average 18.048
Commodities PRICE
DAY %
YTD %
(H) 52W
(L) 52W
WTI CRUDE FUTURE Apr13
92.93
0.421439378
0.215679931
108.4599991
81
BRENT CRUDE FUTR Apr13
109.69
0.036479708
0.577663671
118.2900009
91
GASOLINE RBOB FUT Apr13
317.96
0.933274078
9.622478883
334.4000101
238.2400036
GAS OIL FUT (ICE) Apr13
925.5
0.135244793
0.597826087
1010.5
800.25
NATURAL GAS FUTR Apr13
3.629
-0.438957476
6.641198942
3.997000217
3.032000065
HEATING OIL FUTR Apr13 METALS
296.26
0.481617148
-1.101615703
324.6999979
254.189992
Gold Spot $/Oz
1591.27
0.4095
-4.3972
1796.08
1527.21
Silver Spot $/Oz
29.0794
0.2759
-3.4228
35.365
26.1513
Platinum Spot $/Oz
1593.23
0.0082
4.9732
1742.8
1379.05
769.8
-0.3689
10.0249
786.5
553.75
Palladium Spot $/Oz LME ALUMINUM 3MO ($)
1981.5
1.537279016
-4.413892909
2281
1827.25
LME COPPER 3MO ($)
7830
0.928074246
-1.273483798
8702.75
7219.5
LME ZINC
1986
1.3006886
-4.519230769
2230
1745
3MO ($)
LME NICKEL 3MO ($) AGRICULTURE ROUGH RICE (CBOT) May13 CORN FUTURE
Last 18.24
May13
17030
0.799052974
-0.175849941
19600
15236
15.235
0
-1.614465612
16.95000076
15.21000004
716.25
0.280014001
2.284898251
838
520.25
Max 21.2
average 20.995
Min 20.8
Last 21.05
COUNTRY MAJOR
ASIA PACIFIC
CROSSES
AUD GBP CHF EUR JPY MOP HKD CNY INR THB SGD TWD PHP IDR AUDJPY EURCHF EURGBP EURCNY EURMOP EURJPY HKDMOP
MACAU RELATED STOCKS 2028598
12.54
3.294893
17.52577
12.58
8.06
3517955
17.67000008
AMAX HOLDINGS LT
0.052
-3.703704
-25.71429
0.104
0.05
29381000
68.18999481
BOC HONG KONG HO
26.55
-0.3752345
10.16597
27.1
20.85
8758227
CENTURY LEGEND
0.345
-1.428571
30.18869
0.42
0.215
332000
6.3
-0.6309148
5.175296
6.74
2.8
0
CHINA OVERSEAS
21.6
-3.139013
-6.493508
25.6
14.124
25784021
CHINESE ESTATES
11.96
-0.1669449
-1.396756
12.964
7.697
240163
CHOW TAI FOOK JE
10.76
-2.359347
-13.50482
13.4
8.4
6910600
2
-1.960784
5.820107
2.15
1.1
540000
2.4
-0.8264463
96.72131
2.54
0.495
3590000
142.25
-0.070249385
-3.0334015
204.5999908
137.5999908
SUGAR #11 (WORLD) May13
18.7
-0.637619554
-4.591836735
24.56999969
COTTON NO.2 FUTR May13
87.39
0.068704912
15.19905088
91.59999847
NAME ARISTOCRAT LEISU
CHEUK NANG HLDGS
World Stock MarketS - Indices US
14450.06
0.01917315
US
3242.321
-0.3244208
FTSE 100 INDEX
GB
6470.63
DAX INDEX
GE
NIKKEI 225
0.9582 1.4832 0.9002 1.2043 77.13 7.9824 7.7498 6.2105 49.835 29.55 1.2152 28.913 40.54 9095 74.482 1.19995 0.77553 7.7018 9.6245 94.12 1.029
CROWN LTD
COFFEE 'C' FUTURE May13
NASDAQ COMPOSITE INDEX
1.0637 1.6381 0.9972 1.3711 96.71 8.0039 7.7713 6.3964 57.3275 32 1.2971 30.203 43.975 9904 99.576 1.25692 0.88151 8.4957 10.9254 127.71 1.0314
2.29
1218.75
DOW JONES INDUS. AVG
-0.6745 -7.5668 -3.3266 -1.2585 -10.1159 -0.0839 -0.0864 0.2639 1.3708 3.2759 -2.1393 -2.1799 1.1096 1.0734 -9.5386 -2.0872 -6.3844 1.3305 1.1984 -8.9619 -0.0097
(L) 52W
665
1639.5
EMPEROR ENTERTAI
PRICE
DAY % YTD %
VOLUME CRNCY
(H) 52W
(L) 52W
10.27095
14478.8
12035.08984
GALAXY ENTERTAIN
31.15
0
2.635913
35.7
16.94
6854459
7.378916
3252.874
2726.68
HANG SENG BK
128.4
-0.8494208
8.171865
131.3
99.2
1312721
-0.6142272
9.712416
6533.99
5229.76
HOPEWELL HLDGS
33.5
-0.887574
0.7518797
35.3
19.049
1048500
7949.97
-0.2027336
4.434614
8015.07
5914.43
HSBC HLDGS PLC
84
-0.8849558
3.321029
88.45
59.8
12843374
JN
12239.66
-0.6102408
17.74361
12461.97
8238.96
HANG SENG INDEX
HK
22556.65
-1.458896
-0.4425559
23944.74
18056.4
CSI 300 INDEX
CH
2527.486
-1.100674
0.1797172
2791.303
2102.135
TAIWAN TAIEX INDEX
TA
7995.51
0.01000662
3.844532
8170.31
6857.35
FUTURE BRIGHT
HUTCHISON TELE H
3.8
-1.298701
6.741575
3.92
2.98
1848000
LUK FOOK HLDGS I
22.9
-0.6507592
-6.14754
30.05
14.7
4505309
MELCO INTL DEVEL
12.52
-0.3184713
38.95671
13.96
5.12
8596000
16.6
-0.2403846
25.0162
18.449
9.509
5291200
MGM CHINA HOLDIN
3.39
-1.166181
-8.37838
5
3.249
1816000
NEPTUNE GROUP
MIDLAND HOLDINGS
0.155
-2.515723
1.973687
0.226
0.084
15030000
NEW WORLD DEV
14.02
-0.7082153
16.63893
15.12
7.95
20316920
SANDS CHINA LTD
35.8
-0.4172462
5.449188
39.95
20.65
7647349
SHUN HO RESOURCE
1.53
0
9.285716
1.67
1.03
44000
-0.4672897
1.670643
4.65
2.56
9196763 10187500
KOSPI INDEX
SK
1999.73
0.3205675
0.1341945
2057.28
1758.99
S&P/ASX 200 INDEX
AU
5092.397
-0.4976877
9.538643
5163.5
3985
ID
4835.439
-0.3887884
12.01736
4904.477
3635.283
FTSE Bursa Malaysia KLCI
MA
1646.22
-0.6229853
-2.529973
1699.68
1526.6
SHUN TAK HOLDING
4.26
NZX ALL INDEX
NZ
928.875
-1.518139
5.3083
944.123
755.149
SJM HOLDINGS LTD
18.24
1.672241
1.333333
22.15
12.34
PHILIPPINES ALL SHARE IX
PH
4214.07
-0.08701342
13.92519
4268.160156
3238.77
SMARTONE TELECOM
13.18
0.4573171
-6.392045
17.5
13.08
885000
21
-0.2375297
0.2386598
25.5
14.62
3187300
JAKARTA COMPOSITE INDEX
20.8
(L) 52W
3.94
938
4.591745578
YTD %
0.0971 0.6056 0.095 0.0922 0.1044 -0.0075 -0.0064 0.0338 -0.1084 0.0675 0 -0.0202 0.1726 0.0413 0.003 0.0073 0.5189 -0.3786 -0.0951 0.016 0
(H) 52W
(H) 52W
-10.59980958
-0.357446809
DAY %
1.0308 1.4952 0.9469 1.3024 95.79 7.9899 7.7573 6.2142 54.2513 29.61 1.2481 29.68 40.555 9689 98.746 1.23322 0.87103 8.1096 10.4057 124.75 1.03
YTD %
19.68254
0.106609808
1463.5
PRICE
DAY %
0.5333333
704.25
SOYBEAN FUTURE May13
COUNTRY
PRICE
3.77
WHEAT FUTURE(CBT) May13
NAME
17.8
CURRENCY EXCHANGE RATES
NAME ENERGY
Min 18
20.9
WYNN MACAU LTD
HSBC Dragon 300 Index Singapor
SI
636.81
0.44
2.53
NA
NA
STOCK EXCH OF THAI INDEX
TH
1577.02
0.0215643
13.29736
1586.41
1099.15
HO CHI MINH STOCK INDEX
VN
473.18
-0.4544116
14.36927
497.87
372.39
BOC HONG KONG HO
Laos Composite Index
LO
1429.38
-0.5655613
17.66672
1455.82
933.43
GALAXY ENTERTAIN
ASIA ENTERTAINME
4.01
1.262626
31.04575
6.95
2.4
156074
BALLY TECHNOLOGI
50.69
-0.3930045
13.37509
51.16
41.74
297243
3.45
0
12.37785
3.55
2.68
19975
3.985
-2.567237
0.377833
4.57
2.25
3000
17.1
-0.754498
20.67749
17.38
10.92
3403700
JONES LANG LASAL
99.76
-0.04008016
18.84679
100.33
61.39
274796
LAS VEGAS SANDS
52.74
-0.2081362
14.25477
58.3216
32.6127
3674302 4238133
INTL GAME TECH
Shanghai Shenzhen Composite index is listing the biggest companies by market capitalisation. All data supplied by Bloomberg unless otherwise indicated.
MELCO CROWN-ADR
20.64
-1.667461
22.56532
21.475
9.13
MGM CHINA HOLDIN
2.29
0
23.78378
2.44
1.36
1200
MGM RESORTS INTE
12.35
-0.8032129
6.099653
14.8
8.83
3692869
SHFL ENTERTAINME
15.67
0.1918159
8.068966
18.77
11.75
246015
SJM HOLDINGS LTD
2.32
-4.918033
0.4329029
2.85
1.65
6400
117.98
-0.1438849
4.880436
129.6589
84.4902
1103957
WYNN RESORTS LTD
AUD HKD
USD
14 |
business daily March 14, 2013
Opinion
The dirt on plastic waste Marino Xanthos
P
Professor of Chemical, Biological, and Pharmaceutical Engineering at the New Jersey Institute of Technology
lastics are everywhere. Whether used to store leftovers, keep hospital equipment sterile, or insulate a home, plastics are unmatched for their adaptability, durability, and low cost. Given their seemingly boundless benefits, it is unsurprising that plastics have replaced traditional materials in many sectors – for example, steel in cars, paper and glass in packaging, and wood in furniture. As a result, annual plastics consumption worldwide has increased from five million tons in the 1950’s to around 280 million tons today. Roughly half of plastic products, such as packaging, are intended for one-time, short-lifespan (less than six months) applications prior to disposal. Given that most of these items are not biodegradable, and are not recycled, plastics waste is building up – with serious environmental consequences. While governments have begun to implement new (and often quite strict) regulations aimed at managing plastics waste – for example, China banned lightweight plastic shopping bags in 2008 – they are inadequate to address the world’s growing plasticswaste problem.
Moreover, most plastic products are made from so-called “petroleum-based commodity thermoplastics.” Given that a non-renewable resource forms the basis of many plastic products – most of which will not last long – current plastics usage patterns are not sustainable. Closed-loop recycling, in which plastics waste is used to make another product, thus carries significant environmental benefits, such as reduced energy and oil consumption. But the process of separating the petroleumbased recyclable plastics from other kinds of plastics and solid waste is difficult, costly, and labor-intensive, so only a small proportion is recycled. In 1988, the United States Society of Plastics Industry developed a coding system in which each kind of resin is labeled with a number, 1-7, to facilitate sorting. The system has also been used elsewhere, including in Canada and Switzerland, but has not been adopted worldwide and is still confusing to some consumers. If consumers knew to collect and separate household plastics based on their number, when available, the resulting boost
to recycling efforts would demonstrate to government and industry the viability of a more sustainable approach, reduce exposure to rising oil prices, and support growing global demand for plastics.
New recycling There are four categories of plastics recycling: primary recycling, in which the plastic is re-used in the same application; secondary recycling, in which material
In a world that is reliant on plastics, more sustainable production, consumption, and disposal of plastic products is crucial
(mixed or contaminated) is used in less demanding applications; tertiary recycling, in which the plastic is converted into monomers or chemicals; and quaternary recycling, in which only energy is recovered through incineration. Each of these methods recovers a different amount of the embodied energy of the plastic item. (All of the embodied energy is lost if the plastics are landfilled, a common disposal method worldwide.) Given the difficulty and expense of separating plastics, the most economically viable option is often secondary recycling of a few commodity thermoplastics – mostly bottles, for which collection infrastructure is already in place. More economical separation methods are crucial to expanding the scope of plastics recycling, as is the identification of new potential markets for the recyclates. Such developments would encourage industry to re-use or recycle more parts. Although all 40 kinds of plastics used in a North American automobile can be recycled, the need to separate and clean them makes using them more expensive than using virgin plastic resins. This translates into a higher proportion of plastics in the remnants of shredded end-of-life automobiles – a contaminated mixture of plastics and nonplastics that is usually disposed of through some combination of landfilling, incineration, and secondary recycling. Increasing the proportion of re-used plastics is a crucial step toward more sustainable plastics consumption. To this end, some automobile manufacturers have adjusted their designs to allow for easy disassembly of parts made of compatible plastics, while governments have set recycling target proportions for end-of-life vehicles. Such efforts should be intensified. Furthermore, industry should seek new applications for recycled materials, while minimizing the amount of virgin material used. And, where possible, manufacturers should “downgauge” materials (make parts thinner). Government legislation can be enacted to support such measures, as well as to require plastics manufacturers to get involved in the disposal of plastic
items – a responsibility long imposed on packaged-goods manufacturers in Europe.
Carbon footprint An example of successful waste management is the reprocessing of PET bottles (made of polyethylene terephthalate) into polyester fibers. In the last decade, Japan passed several laws obliging both businesses and individuals to separate plastics waste. This, combined with a lack of landfill space and the country’s expanding population, has enhanced plastics recycling efforts. As a result, in 2010, Japan recycled 72 percent of PET bottles, compared to roughly 30 percent in the US and 48 percent in Europe. While incineration and landfilling are still practiced, such high recycling rates underscore the positive impact of targeted policies. Another promising development is bioplastics, which have begun to compete with petroleum-based products in certain shortlifespan applications – such as packaging and agriculture – over the last two decades. Given that bioplastics are produced from renewable or “bio-based” sources (cellulose, starch, and glucose) – and, in some cases, through microbial fermentation – they have a lower carbon footprint, contribute less to global warming, and biodegrade to small molecules. But bioplastics are not a silver bullet for managing plastics waste. In fact, they may threaten the secondary recycling of petroleum-based plastics, owing to possible contamination during sorting of mixed streams. And critics have expressed concern about the environmental impact of corn and other crops grown for industrial purposes, such as plastics and ethanol production, not to mention the potential effects on global food prices. In a world that is reliant on plastics, more sustainable production, consumption, and disposal of plastic products is crucial. Civil society, industry, and government must work together to increase the share of recycled plastics, thereby ensuring that plastics’ costs do not outweigh their benefits. © Project Syndicate
editorial council Paulo A. Azevedo, Tiago Azevedo, Duncan Davidson, Emanuel Graça Founder & Publisher Paulo A. Azevedo | pazevedo@macaubusinessdaily.com Editor-in-Chief Tiago Azevedo DEputy Editor-in-Chief Vitor Quintã Associate editor Michael Grimes Newsdesk Alex Lee, Luciana Leitão, Stephanie Lai, Tony Lai Creative Director José Manuel Cardoso Designer Janne Louhikari Contributors Frederico Rato, José I. Duarte, Pereira Coutinho, Ricardo Siu, Rose N. Lai, Zen Udani 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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March 14, 2013 business daily | 15
OPINION Business
The ethics of big food
Leading reports from Asia’s best business newspapers
Peter Singer
wires
Professor of Bioethics at Princeton University and Laureate Professor at the University of Melbourne
The Star Hunza Properties Bhd plans to undertake a RM3.5billion mixed development scheme in Bayan Baru, the south-west district of Penang island, Malaysia, two years from now. Group executive chairman Datuk Khor Teng Tong said the project on a 40-acre site would comprise a shopping mall, a hospital, an indoor amusement park and a college. Mr Khor added that the group would develop 700 low-cost units for the squatters who would be relocated. The group plans to invest about RM800 million (US$258 million) in several property projects until 2016.
as recent changes in rainfall patterns have made evident. Clearing tropical forests for grazing or palm-oil production releases large quantities of stored carbon into the atmosphere. Grazing ruminant animals, like cattle and sheep, also contribute significantly to climate change.
Voices heard
The Korea Herald A free trade agreement with the United States has pushed down South Korea’s tariff revenue on United States imports for the first time in seven years, despite an increase in trade with the world’s largest economy. The Ministry of Strategy and Finance said Tuesday that tariff revenue on United States imports sank to 9.8 trillion won (US$8.9 billion) last year, down 10.7 percent from 10.9 trillion won a year ago. This is the first time South Korea saw its customs revenue decline since 2005, the ministry noted.
Thanh Nien News Partly private Phuong Tay Bank said it plans to merge into Petrovietnam Finance Corp (PVFC) as part of the Vietnamese central bank’s scheme to restructure lenders saddled with mountains of bad debt. The tie-up will turn Phuong Tay Bank and PVFC, state oil and gas group Petrovietnam’s finance arm, into a single mid-sized bank with combined equity of VND9.16 trillion (US$438 million), Phuong Tay said in a merger plan sent to shareholders. The merger, expected to be completed this year, will rescue Phuong Tay Bank from its bad debts, the plan said.
The Yomiuri Shimbun Methane hydrate, a form of natural gas, was successfully extracted from the seafloor about 80 kilometers off the coast of Aichi Prefecture, the industry ministry announced Tuesday. The feat is believed to be a world’s first. The seas near Japan are estimated to hold enough methane hydrate to supply the nation with natural gas for 100 years at current consumption levels. The government is aiming to commercialize methane hydrate by fiscal 2018, according to the Economy, Trade and Industry Ministry.
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ast month, Oxfam, the international aid organization, launched a campaign called “Behind the Brands.” The goal is to assess the transparency of the world’s ten biggest food and beverage companies concerning how their goods are produced, and to rate their performance on sensitive issues like the treatment of small-scale farmers, sustainable water and land use, climate change, and exploitation of women. Consumers have an ethical responsibility to be aware of how their food is produced, and the big brands have a corresponding obligation to be more transparent about their suppliers, so that their customers can make informed choices about what they are eating. In many cases, the biggest food companies themselves do not know how they perform on these issues, betraying a profound lack of ethical responsibility on their part. Nestlé scored highest on transparency, as they provide information on at least some of their commodity sources and audit systems. But even its rating is only “fair.” General Mills was at the bottom of the ranking. In addition to this lack of transparency, Oxfam’s report identifies several deficiencies common to all of the Big 10 food companies. They are not providing small-scale farmers with an equal opportunity to sell into their supply chains, and when small-scale farmers do have the opportunity to sell to the big brands’ suppliers, they may not receive a fair price for their product. The Big 10 are also not taking sufficient responsibility to ensure that their larger-
scale farm suppliers pay a decent living wage to their workers. There are 450 million wage workers in agriculture worldwide, and in many countries they are often inadequately paid, with 60 percent living in poverty.
Child labor Some of the Big 10 are doing more than others to develop ethical policies in these areas. Unilever has committed itself to sourcing more raw materials from small-scale farmers, and has pledged 100 percent sustainable sourcing for all of its main commodities by 2020. This policy gave Unilever the highest score on openness to small farmers, with a rating of “fair.” Danone, General Mills, and Kellogg’s were at the bottom, with a rating of “very poor.”
Consumers have an ethical responsibility to be aware of how their food is produced, and the big brands have a corresponding obligation to be more transparent
For many years, Nestlé was criticized for marketing infant formula in developing countries, where breastfeeding was available and much healthier than bottlefeeding. It revised its policies in response to that criticism, but more recently has been targeted again for using child and forced labor to produce its cocoa. In 2011, the company used the Fair Labor Association to assess its supply chain. The assessment confirmed that many of Nestlé’s suppliers were using child and forced labor, and the company has now begun to address the problem. As a result, Nestlé, along with Unilever and CocaCola, scored “fair” on workers’ rights. None of the Big 10 did better. Kellogg’s received the lowest score in this category. Agriculture is a major source of greenhouse-gas emissions, accounting for more than the entire transport sector, and it is also one of the sectors most at risk from climate change,
Here, too, the big brands receive low grades from Oxfam, mostly for failing even to track the emissions for which they are directly or indirectly responsible. Nestlé was the only company to achieve a “fair” rating, with Associated British Foods at the bottom, with a “very poor” rating. Anyone with Internet access can visit Oxfam’s Web site and see how the big brands rank on each of seven ethically significant indicators. The highest scores currently are in the “fair” range, with not a single Big 10 company receiving a “good” rating in any category. Individual consumers are encouraged to contact the companies directly and urge them to demonstrate greater responsibility for the way in which they obtain the ingredients for their products. In this way, Oxfam hopes, its “Behind the Brands” campaign will trigger a “race to the top” in which big corporations compete to achieve the highest possible score, and to become known as truly transparent actors that produce food and beverages with a high degree of ethical responsibility. The changes that have already occurred show that if big corporations know that their consumers want them to act more ethically, they will do so. To be effective, such a campaign requires individual consumers to take it upon themselves to become better informed about the food and beverages that they consume, to make their voices heard, and to make purchasing choices that are influenced by ethics as well as by taste and price. © Project Syndicate
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business daily March 14, 2013
CLOSING Inditex sidesteps European gloom Zara owner Inditex, the world’s largest clothing retailer, posted a sharp rise in full-year sales and profit as its drive to expand outside austerity-hit Europe continued to pay off. Inditex said net profit rose 22 percent to 2.4 billion euros (US$3.1 billion) as, unlike many competitors, it offset woes in Europe through expansion abroad. Sales rose 16 percent to 15.9 billion euros, with Asia’s share growing to 20 percent from 18 percent and the Americas expanding to 14 percent from 12 percent.
Red flag on Abu Dhabi debt doubted Investors are downplaying a Moody’s warning that 2014 will be a “pivotal” year for Dubai as a US$20 billion loan repayment to Abu Dhabi and the central bank is due. The cost of insuring Dubai’s debt for five years fell 2 basis points, even though Moody’s Investors Service said the emirate’s corporates may be hit by a “debt wall” next year. Dubai’s corporates are faced with an unclear restructuring framework and uncertain support from Abu Dhabi, according to the rating company.
London has early lead in EU yuan race The Bank of England said it has first-mover advantage in possible yuan trading deal Maria Levitov, Ye Xie and Lyubov Pronina
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ondon is racing against Paris and Zurich to become the center for yuan trading in Europe as China seeks to take its currency global. The Bank of England said it has the inside edge to be the first Group of Seven nation to sign a currency-swap agreement with the People’s Bank of China after a meeting last month. The deal may allow the United Kingdom central bank to supply as much as 400 billion yuan (US$64 billion) to banks, matching Hong Kong’s swap arrangement, according to Gao Qi, a markets strategist at Royal Bank of Scotland Plc in Singapore. The center of the world’s US$4 trillion-a-day market for foreignexchange trading is expanding ties with the second-biggest economy after yuan-denominated bond sales overseas surged 11-fold to 174 billion yuan since 2009 and trading in the currency more than tripled in London. China started pushing for the greater use of the yuan outside the mainland in 2010. The swaps would allow the
The United Kingdom is the third-largest offshore yuan trading centre
Bank of England to supply yuan to importers and other users when there’s a shortage of the currency. The “safety net” would have a
“very strong psychological effect” in boosting confidence in trading yuan, said Philippe Lintern, co-head of wholesale banking for Europe at
Standard Chartered Plc last month. Since China started a pilot program allowing the use of yuan to settle international transactions in 2009, the proportion of its trade conducted in yuan has increased to 9 percent from less than 1 percent, according to the People’s Bank of China. By 2015, a third of China’s crossborder trade will be settled in yuan, making the currency one of the three most used in global trading along with the dollar and euro, HSBC forecast this week in a report. Yuan-denominated bonds sold by companies, including McDonald’s Corp. and Caterpillar Inc., rose to 174 billion yuan last year from 16 billion in 2009, Bloomberg data show. Standard Chartered and HSBC underwrote 36 percent of so-called Dim Sum bond sales in 2012. In the offshore yuan market, the United Kingdom made up 3 percent of the total transactions last year, the third-largest after Hong Kong, with a 73 percent share, and mainland China at 5.2 percent. Bloomberg News
Cyber attacks leading threat against U.S. But top official plays down likelihood of catastrophic attacks Mark Hosenball and Patricia Zengerle
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merican intelligence leaders said for the first time that cyber attacks and cyber espionage have supplanted terrorism as the top security threat facing the United States. That stark assessment, in an annual “worldwide threat” briefing that covered concerns as diverse as North Korea’s belligerence and Syria’s civil war, was reinforced in remarks by the spy chiefs before the Senate Intelligence Committee. They expressed concern that computer technology is evolving so quickly it is hard for security experts
James Clapper, the U.S. Director of National Intelligence
to keep up. “In some cases, the world is applying digital technologies faster than our ability to understand the security implications and mitigate potential risks,” James Clapper, the Director of National Intelligence, told the committee. In written testimony, Mr Clapper softened his analysis somewhat, playing down the likelihood of catastrophic attacks on the United States in the near term - either through digital technologies, or from foreign or domestic militants employing traditional violence.
But this year’s annual threat briefing underscored how, a decade after the Iraq war began and nearly two years after the killing of al Qaeda leader Osama bin Laden, digital assaults on government and computer networks have supplanted earlier security fears. On Monday, White House national security adviser Tom Donilon, citing complaints from U.S. businesses about alleged Chinese cyber espionage, said the issue is a growing challenge to economic relations
between the United States and China. China said on Tuesday it was willing to meet Mr Donilon’s request that Beijing talk with the United States about cyber security. In a separate hearing before the Senate Armed Services committee, Army general Keith Alexander, head of the United States military’s Cyber Command, said cyber attacks on private companies and in particular on the American banking sector were getting worse. Reuters