Macau Business Daily, May 24, 2013 by Business Daily

CTM profit soars in first quarter

www.macaubusinessdaily.com

Year II

Number 290

Friday May 24, 2013

Editor-in-chief Tiago Azevedo

Deputy editor-in-chief

Vitor Quintã

MOP 6.00

April 19, 2013

Too many people working six days a week: report

The city’s biggest telecommunications company is again under fire after a new network service failure on Tuesday but on the financial side the picture remains rosy. Companhia de Telecomunicações de Macau, SARL (CTM) saw its operational profit rise by 20 percent in the first quarter of this year, mostly thanks to more data and roaming services. With data revenue representing a quarter of CTM’s mobile service revenues in the first quarter, the firm’s operations were more profitable than ever. Page 7

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ver 60 percent of the 10,000 respondents to a recent survey have had to work six days a week last year, a situation that is causing growing stress. The Macau Association of Economic Sciences called on the government to implement a five-day working week, along with standard working hours and overtime compensation.

Macau workers are working fewer hours than in 2008, but many are still suffering “negative psychological and health impact” from long working hours, the survey shows. With the economy growing, being under pressure at work is now the biggest concern for employees. Job security is no longer a major worry, underlines the report. More on page 3

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New gaming show no threat to G2E Asia

May 23

HSI - Movers Name

The new Macau Gaming Show planned for November will have “a totally different concept and different approach” to Global Gaming Expo (G2E) Asia, organiser Jay Chun says. The new event will be cheaper for exhibitors and visitors and have a different focus, namely on VIP junket operators, Mr Chun told Business Daily. The show was not meant as a challenge to the existing annual trade event or to the American Gaming Association, which co-organises G2E Asia, he stressed. But Marcus Prater, executive director of the Association of Gaming Equipment Manufacturers, says it’s “hard” to imagine another gaming trade show in Macau. Page 5

%Day

LENOVO GROUP LTD

2.79

CHINA RES POWER

-0.25

CHINA RES ENTERP

-0.41

POWER ASSETS HOL

-0.47

ESPRIT HLDGS

-0.87

CHINA COAL ENE-H

-4.32

WHARF HLDG

-4.34

LI & FUNG LTD

-4.39

BELLE INTERNATIO

-4.48

CHINA UNICOM HON

-5.48

Source: Bloomberg

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Public buses mean losses for govt

Visitor arrivals slightly up in April

Two Airbus flying in for Air Macau

The government lost almost 100 million patacas (US$12.5 million) in the last quarter over the new public bus system. And this figure will only increase once payment hikes for two of the city’s three bus operators are included. The authorities say the loss is mostly due to subsidised fees for the elderly, students and people with disabilities.

Macau welcomed almost 2.4 million visitors last month, a slight hike of 0.7 percent year-on-year. The growth was mainly due to an increasing number of visitors from mainland China but there were also more tourists from Thailand and South Korea. On the other hand, visitor arrivals from Hong Kong and Taiwan continued to slump and tourists are paying briefer visits to the city.

A United States aircraft leasing firm announced it will lease two new Airbus A321-200 aircrafts to flag carrier Air Macau Co Ltd, with the first one being delivered in October 2014 and the second in March 2015. But those aircraft cannot fly for more than five hours and will do little to help the company launch long-haul flights.

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May 24, 2013

Macau

Govt losing money over public buses Tony Lai

tony.lai@macaubusinessdaily.com

he government announced it made a loss of almost 100 million patacas (US$12.5 million) in the last quarter from the new public bus system. The Transport Bureau said it received about 70.5 million patacas from bus charges paid by commuters in the first quarter, while paying 170 million patacas to bus operators for their services. The bureau said that the loss was mostly due to subsidised fees the government provided for the elderly, students and people with disabilities. Those subsidies cost 78.1 million patacas, according to a press statement released yesterday. But the administration will likely make an even bigger loss once payment hikes for two of the city’s three bus operators are included, the bureau admitted. The government announced last month it would pay a further 23.3 percent to Transportes Urbanos de Macau SARL (Transmac) and Sociedade de Transportes Colectivos de Macau SARL (TCM). The payments will be backdated to January. The increase means the

The number of public bus passengers rose by 10 percent last quarter

government has to pay 645.5 million patacas more every year, or 161.4 million patacas per quarter. The third operator, Reolian Public Transport Co, also requested more money last June but its application has been put on hold. The transport regulator also said the number of bus trips inched up

High hopes for art debut James Chu Artist and designer

lot of art-related happenings are taking place in Hong Kong. While the giant rubber duck art installation by Florentijn Hofman floats in Victoria Harbour, one of the most important international fairs, Art Basel, has made its Hong Kong debut and runs until Sunday. Art Basel was founded by Trudi Bruckner, Balz Hilt and Ernst Beyeler in Switzerland, in 1970. It has become a leading annual art event because of its organisation and positioning. It has attracted famous global galleries and collectors, making it not only the most important art event in Europe but also anywhere in the world. By 2002, Art Basel had extended to the United States. Art Basel Miami Beach has achieved the same level of success as its namesake with a good reputation for selecting galleries as well as artists. Art HK was Hong Kong’s international art fair. The fair’s shining sales record drew regional and international attention that saw Art Basel buy a 60-percent share of the event last year. The hot market for contemporary Chinese art has established Asia as the world’s second biggest art market. There are many Asian countries and cities hopeful of playing a lead role in the art field, including Beijing, Shanghai, Taiwan, Seoul, Taipei, Dubai and Singapore. Many have tried to build auctions, their own international fairs and art centres. But Hong Kong has had a special role in the art world for a long time because of a taxfree policy, professional services and reputable legal system. Hong Kong might secure its leadership role if Art Basel succeeds. It is not difficult to imagine Art Basel taking the leading role in the global art business if it can conquer Europe, Asia and America. The results of the Hong Kong experiment are not easy to predict. Hundreds of people are waiting to see the results of the debut edition. No matter what, it is “the” art event and not to be missed. Art Basel Hong Kong May 23-26 Hong Kong Convention and Exhibition Centre www.artbasel.com

Macau has thousands of new flats currently being built but that may not necessarily translate into more housing supply in the future as many have already been sold. The Land, Transport and Public Works Bureau said in a press statement yesterday that there were 88 projects comprising 7,620 flats being built in the first quarter of this year. The bureau expects more than 6,600 flats in 21 projects to be completed in the next three years. But about one-third of those flats, or 2,640 houses, will come from an unidentified Cotai project, the bureau said. This project is likely the high-end development One Oasis. According to the bureau’s housing pre-sales website, 2,574 flats, or 97.5 percent, of One Oasis’ units had already been pre-sold by the end of last month. The bureau did not say how many homes still under construction had already been pre-sold. The statement also said that the bureau issued housing permits to 102 flats in eight projects during the first three months of this year while 44 more flats were up for final inspection. In the January-March period the bureau was also reviewing the construction plan of 239 new projects that could provide over 30,400 flats. T.L.

business as usual

Over 7,600 flats in the pipeline

by 1.1 percent year-on-year to over 264,000 per month in average. The number of passengers grew much faster, by 10 percent to 13.4 million per month in average, in the first three months this year. Some electric-powered buses will start trial operations next month, the statement added.

May 24, 2013

Macau

Working week too long, labour researchers say A survey finds that employees thought their jobs were more secure but felt more stress last year Tony Lai

tony.lai@macaubusinessdaily.com

KEY POINTS No pay increase for 58.9 percent of employees last year Employees in property management worked 8.98 hours per day Over 23 percent of employees worked nine hours per day Pay, working hours and holidays main concerns Two-thirds say illegal workers a ‘severe’ problem

Almost three-quarters of hotel and restaurant employees worked six days per week last year

mployees should work just five days per week to relieve their stress, according to the report on the findings of a labour survey. The survey, carried out last year by the Macau Federation of Trade Unions and the Macau Association of Economic Sciences, found the main cause of anxiety among employees was too much pressure at work. More than one-quarter of the 10,000 and more employees surveyed said this was their main worry. The previous such survey, in 2008, found the biggest cause of anxiety, given by almost one-third of employees as their main worry, was job security. The latest survey found job security was only the sixth-biggest

Bank wages fall despite profits T

he average basic salary of most banking workers fell last quarter, for the first time in two years, official data show, even though banks had the most profitable period on record. Frontline staff saw their average wage fall by 6.7 percent in just halfyear to 12,550 patacas (US$1,570), the Statistics and Census Service announced yesterday. The income loss was smaller for technicians and associate professionals, who saw their income decrease by 1.8 percent from the third quarter of last year to 17,900 patacas. Bank directors and managers were not immune to the slump either, as

cause of anxiety, given by 14.9 percent of employees. The president of the Macau Association of Economic Sciences, Joey Lao Chi Ngai, told a press conference yesterday that this greater feeling of security was due to the economic boom. “Workers felt anxious in 2008, which was the start of the financial tsunami, so most people worried about their job security,” Mr Lao said. “But after the city maintained double-digit economic growth in 2010 to 2012, there have been changes in workers’ job worries.” He said a five-day working week would “help workers relieve their stress, and balance their life and work”. The survey found that employees

their average basic salary fell by a slight 0.5 percent to 41,500 patacas. The only exception to this trend was bank tellers, whose average wage rose by a measly 0.4 percent to 12,380 patacas, just above the citywide median monthly salary of 12,000 patacas. Nonetheless, banks were spending more money on staff wages last quarter, partially because they hired a further 187 workers, taking their workforce to a record high 5,363. Moreover, the number of highpaid directors and managers of banks grew much faster in last two quarters than the number of staff. Over 100 directors and managers were hired between October and March, while the number of clerks dropped by 186 to 2,161. The banking industry had 1,268 directors and managers at the end of last quarter. Top-ranking and middle-ranking executives

worked, on average, 8.38 hours per day last year, having worked 8.57 hours per day in 2008. Over 60 percent of employees worked six days per week. In the gaming industry, 81.5 percent of employees had a six-day working week. In the hotel and restaurant industry 74.5 percent had a six-day week.

Import tax call Only one-quarter of all employees had a five-day working week. “Many employees want this fiveday working week and we encourage the government to promptly carry out studies to see how to implement this,” Mr Lao said.

The survey report says many places, including mainland China and Hong Kong, are moving towards a five-day week. The report says standard working hours should be introduced to prevent “negative psychological and health impact on employees amid long working hours”. About one-quarter of employees had fewer than four paid days off per month, the minimum required by law. And 22.2 percent worked overtime but were neither paid for it nor given time off in lieu. The survey report proposes that the government consider taxing employers for importing labour to “better safeguard the interests of resident workers”. Mr Lao said: “When the cost of hiring outside workers surges, the employer will naturally consider employing more locals.” His association says Singapore taxes employers at a rate of between HK$1,756 and HK$4,078 per imported employee per month. He said employers of imported domestic servants could be exempted from such a tax, there being “such a need” for servants here. The survey was carried out between November 2012 and January. The researchers interviewed nearly 10,500 employees, most belonging to affiliates of the Macau Federation of Trade Unions. Asked whether the preponderance of trade union members in the sample might have coloured the findings, Mr Lao said the size of the sample was enough to offset this risk.

Bank tellers were the only exception to a slump in banking wages

accounted for more than one in every four banking workers. The combined first-quarter operating profit of the 29 banks here rose to 1.68 billion patacas last

quarter. It was the most profitable first quarter for the banking here since the authority began publishing such data in 1990. V.Q

May 24, 2013

Macau

Number of visitors inches up in April

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HOSPITALITY

But fewer Hong Kong, Taiwan or American tourists visit

Stay the night

Stephanie Lai

sw.lai@macaubusinessdaily.com

The number of guests in the city’s hotels is rising steadily, reaching a record high in March and exceeding 900,000 people for the first time. The rate of growth is 42 percent compared to two months ago and 20 percent growth compared to the same time last year. In June 2011, the number of monthly hotel guests first moved past 700,000 people. Most of the growth is in five-star hotels, which are poised to welcome about 600,000 people a month. The number of guests staying in four-star hotels was stable in 2011 but increased slightly last year, meaning the share of guests staying at five star hotels has increased continuously. Using data from the month of March, the proportion increased from less than 50 percent in 2011 to almost 55 percent last year and to more than 61 percent this year.

The number of visitors from Hong Kong fell last month 40

The number of guests booking hotel accommodation through the travel agencies is not increasing and is relatively stable. The agencies’ share of guests has declined from about 48 percent in early 2011 to about 35 percent this year. Compared with the same time last year, the proportion of hotel stays in March booked by agencies dropped by more than 9 percentage points. The decline is not consistent across all hotel categories. The proportion of guests booked by agencies to stay in five star hotels has increased slowly but steadily from less than 40 percent in 2011 to about 50 percent this year. J.I.D.

915,766

The record number of hotel guests in March

acau had almost 2.4 million visitors last month, 0.7 percent more than a year earlier, the Statistics and Census Service announced yesterday. The growth was due mainly to more visitors from mainland China – the city’s biggest source of tourists. Nearly 1.54 million mainlanders visitors arrived last month, up by 10.4 percent more than a year earlier year-on-year. Over 647,300 were from just across the border in the province of Guangdong, usually the city’s biggest source of mainland tourists. Nearly 613,900 mainland visitors, or 40 percent, were travelling on individual visas, 13.4 percent more than a year earlier. Some mainlanders are allowed visas to travel to Macau as individuals rather than as members of tour groups, which travel on collective visas. April is not a peak month for tourism, but the Border Gate was busy anyway. Some 1.09 million travellers used the border crossing between April 4 and April 7, during the Ching Ming festival holidays. For the Ching Ming festival holidays the authorities tried for the first time keeping the border crossing open for two hours per day longer than usual.

The number of Thai visitors rose to almost 27,200, or 20 percent more than a year earlier and the most for five years. Thailand had its new year holidays last month. The number of South Korean visitors – the major East Asian visitor source to Macau – rose by 8.9 percent.

Russians are coming The number of visitors from Hong Kong fell by 17.7 percent to about 538,700. The number of visitors from Taiwan fell by 4.8 percent to about 81,600, even though it is now easier for some Taiwan people to get here. I n D ecem b er Ta i w a n ’ s E v a Airways Corp began daily flights to Macau from the western Taiwan

22 %

Year-on-year increase in Russian visitors in first four months

city Taichung. In the first four months of this year the number of visitors from Hong Kong fell by 4.7 percent from a year earlier and the number from Taiwan fell by 4.6 percent. The numbers of visitors from Macau’s main sources of tourists further afield also tended to fall. The number of visitors from the United States fell by 5.1 percent to 58,622 and the number from Australia fell by 8.8 percent to under 38,800. Russian visitors bucked this trend, their number in the first four months increasing by 22 percent from a year before to 11,600. The Macau Government Tourist Office opened a representative office in Moscow in March in an effort to entice more Russians to visit. Direct flights to Russia are part of Macau International Airport Co Ltd’s plans for this year, the operator’s director of finance and administration, Grace Cheang Sok Kuan, said in March. Tourists paid briefer visits last month. They stayed, on average, for 1.0 day, having stayed for 1.1 days a year earlier. Less than half (48 percent) of visitors stayed overnight. Those that did stay overnight stayed, on average, for 1.8 days, having stayed for 2.1 days a year earlier.

May 24, 2013

Macau

Planned new gaming show ‘totally different’ Jay Chun says Macau Gaming Show in November will be no threat to G2E Asia Michael Grimes michael.grimes@macaubusinessdaily.com

two shows. G2E Asia is a very professional show. Reed is a good company. We respect them. It’s nothing to do with Reed’s running of G2E Asia. We have nothing against the American Gaming Association either.” He added: “Personally at LT Game we have always supported G2E [Asia]. This is a great show. We’ll be at G2E in the U.S. as well. And we would like to bring some of our association members to the U.S. show as well. But G2E [Asia] is more focused on the ETGs [electronic table games]. Ours will be very different,” he explained.

Junkets invited

Jay Chun, chairman, Macau Gaming Equipment Manufacturers Association

he new Macau Gaming Show planned for November will have “a totally different concept and different approach” to Global Gaming Expo Asia, the new show’s organiser Jay Chun told Business Daily yesterday. Mr Chun, chairman of the Macau Gaming Equipment Manufacturers Association and also chairman of local casino equipment firm LT Game Ltd, was speaking from the floor on the final day of G2E Asia 2013. LT Game – a specialist in electronic table games – was involved in a trade dispute with market competitor Nevada-based SHFL entertainment Inc. at last year’s G2E Asia. G2E Asia is organised by companies from outside Macau,

namely the American Gaming Association and Reed Exhibitions. Some G2E Asia delegates spoken to by Business Daily yesterday thought the timing – on the first day of G2E Asia 2013 – of MGEMA’s announcement of its new show, was provocative. But Mr Chun told us that MGEMA’s new event – due to be held from November 14 to 16 also at CotaiExpo at The Venetian Macao – was not meant as a challenge to the existing annual trade event. “Perhaps our aim has been misunderstood, so I’m glad to be able to talk about this. We are not trying to push down G2E Asia,” stated Mr Chun. “I think there will be value in

The new event will have six topic areas, including VIP junket operators, said the LT Game boss. “One is VIP junkets, because they produce 70 percent of the [gaming] income from Macau. And they want to stand out and show the rest of the world that we are well regulated. It’s not an underground activity. It’s important to showcase that,” said Mr Chun. The other sectors for the Macau Gaming Show will be gaming equipment suppliers, gamingrelated suppliers such as chair and table manufacturers, non-gaming equipment suppliers, casino souvenir makers, and food and beverage suppliers to the gaming industry. Mr Chun said the response from G2E Asia exhibitors to the idea of a new show had been “quite positive”. Asked about concerns expressed to Business Daily by G2E Asia delegates that it would be costly to attend two events, Mr Chun replied: “Some of our members have complained that G2E Asia is quite expensive. Of course our show will

be a little bit cheaper.” He said that details on the pricing of the new event were available from his contractor, but Business Daily was unable to contact the new show’s contractor before the newspaper went to press. The LT Game boss said the scheduling of the new show in November would help companies that have their financial year ending in June. “For those with a year end in June, if they want to buy something here [at G2E Asia] they may have to wait six months until the next year’s [purchasing] budget. And maybe by then the decision makers will have moved jobs. So I think Macau has the capability to support two shows,” he said. Marcus Prater, executive director of the Association of Gaming Equipment Manufacturers, gave Business Daily a reaction to the announcement of the new event. “AGEM president Tom Jingoli and I spoke Wednesday with Jay Chun and part of his new show team and encouraged an improved level of communication among all of the suppliers and parties involved in the Asian gaming market,” stated Mr Prater. “I think everyone agrees the G2E Asia show that ended today was a success, so it’s hard for me right now to consider the idea of another gaming trade show here in Macau later this year. I’m sure my AGEMmember companies will let me know their thoughts in the coming days and weeks,” he added. Frank J. Fahrenkopf, president and CEO of the AGA, told Business Daily this week that it was “certainly the right” of people in Macau to have their own gaming trade show if they wished.

Junket boss calls for defaulting VIPs blacklist High roller rooms do informally share intelligence on players’ credit problems Michael Grimes michael.grimes@macaubusinessdaily.com

Junket veteran Yu Yio Hung

Macau junket operator said yesterday he would like to see the creation of a formal blacklist of VIP gamblers that fail to repay their credit. Yu Yio Hung, a 27-year veteran of Macau high roller operations, runs a junket business called CCUE with rooms at MGM China Ltd’s MGM Macau, Sociedade de Jogos de Macau SA-licensed L’Arc and Melco Crown Entertainment Ltd’s Altira. The name ‘CCUE’ is a play on the Mandarin Chinese phrase for ‘very good luck with everything’ – pronounced ‘shì shì rú yì’. “I’d like to see the setting up of

a database – a blacklist database – so that if a VIP customer has an unpaid balance and therefore an outstanding debt, all the junket operators will know about it so that the player cannot then borrow more money from other junket operators and go bust,” said Mr Yu in comments translated by moderator Tony Tong during a conference session at the Global Gaming Expo Asia at The Venetian Macao. Industry sources have told Business Daily that in practice VIP operators do informally share intelligence on bad debts owed to

junkets, but sometimes in the past defaulting players have managed to register for fresh credit with another junket operator by using a different identity. It’s likely however that it would be difficult to organise a formal VIP credit blacklist. Data protection and other privacy ordinances currently in force in Macau prevent companies from sharing personal data of individuals with third parties. In March it was announced that Gaming operator Wynn Macau Ltd had been fined 20,000 patacas (US$2,500) for breaching the

privacy law by publicly disclosing personal information of hotel guests as part of a report on removed director Kazuo Okada. In April it was disclosed that gaming concessionaire Venetian Macau Ltd had been fined 40,000 patacas for breaching privacy law in a case linked to the export to the United States of data relating to the company’s former chief executive Steve Jacobs. Macau casino operators have – via the Hong Kong Courts – successfully sued directly managed VIPs (i.e., non-junket customers) for defaulting on credit markers.

May 24, 2013 April 19, 2013

Macau Brought to you by

Financial Monitor Grey power Fewer residents are being born and they are living longer. These twin trends mean the population is ageing relatively quickly. Demographic trends take place over long periods of time before patterns become apparent. But even a cursory glance at the changes to the age structure of the population over the past five years underlines the speed of the changes taking place.

Air Macau to lease two small Airbus First aircraft to be delivered in October 2014, no solution for long-haul flights Vítor Quintã

vitorquinta@macaubusinessdaily.com

lag carrier Air Macau Co Ltd will get two new Airbus A321-200 aircraft, with the first one being delivered in October

2014, a United States aircraft leasing firm announced. California-based Air Lease Corp said late Tuesday it signed “long term

Air Macau’s new aircraft cannot fly for more than five hours

The number of people younger than 15 years old and those aged between 15 and 24 years has decreased in each of the five years of this analysis. The decrease is about 4 percentage points if the two categories are combined. In the group aged 15 years or younger, the number of people is about one-quarter less than the number aged 15 to 24. The declining trend will accelerate in the next few years and the number of older residents is about to receive a boost. With more people entering the 55 to 64 year-oldcategory, the number of people older than 65 years will start to grow faster. Overall, these trends will have a serious impact on public policies, especially for education, health and social welfare. The development of the labour market will depend increasingly on immigration policies that may also create tension. The city will increasingly rely on imported labour to sustain economic growth and standards of living. J.I.D. The content of this column is the work of Business Daily’s journalists.

22.6%

Increase in people older than 55 years in the past five years

Corporate M&C Saatchi closes HK creative operations Mandarin Oriental, City of Dreams and Sands China Ltd will have to find new creative agency partners, after M&C Saatchi announced it is closing it core creative and account departments in Hong Kong. The group’s Hong Kong office gave at least four months advance notice to its still-active clients, Campaign Asia-Pacific magazine

Four Seasons launches Macanese food festival Four Seasons Hotel Macao will hold a Macanese Food Festival at Belcanção restaurant from June 4 to July 8, featuring a buffet spread of local delicacies. This campaign helps support the Macanese Gastronomy Association of Macau, a group established in 2006 to preserve and promote this local cuisine, the hotel said in a statement.

reported. Hong Kong used to be the agency’s Asia hub but “it’s not a very important centre anymore. It’s so small it really doesn’t matter in the scheme of things,” said Chris Jaques, chief executive of M&C Saatchi Asia. After 18 years in Hong Kong, the agency will instead focus on its two hubs in Shanghai and Singapore, Mr Jaques said. Hong Kong is no longer the gateway to mainland China it used to be and it also cannot compete with the Singapore government incentives to set up companies, the executive added.

Four Seasons has invited Florita Alves, one of the master chefs in the Macanese Gastronomy Association of Macau, to be the guest chef behind the Macanese Food Festival. Ms Alves will share the most popular Macanese dishes enjoyed by generations of her family with the hotel’s culinary teams headed by executive chef Klaus Kallweit. Based on recipes passed down through many generations of Macanese families, the featured dishes reflect the complex history, blending Southern Chinese and Portuguese flavours with ingredients from Latin America, Africa and India.

lease agreements” with Air Macau for the two aircraft. The aircraft are scheduled for delivery in October 2014 and March 2015, the New York-listed company added. Air Lease Corp “has worked closely with Air Macau’s management team since 2010 to provide fleet planning solutions that enhance their future operations,” said Jie Chen, the firm’s executive vice president and managing director for Asia. “We are pleased that these two new and efficient aircraft will be a part of their long term fleet plans,” he added in a statement. Business Daily tried to confirm this information with Air Macau but received no reply before press time. Two weeks ago Air Macau vice-president Yang Jianhua said the carrier planned to buy two new Airbus A321 aircraft within two years. Each will cost at least US$56 million (448 million patacas), he added. The aircraft cannot fly for more than five hours or carry up to 180 passengers and is similar to smaller single-aisle aircraft Air Macau already flies. Mr Yang said the company would need bigger models such as the 335-passenger-capacity Airbus A330 to fly to long-haul destinations, lasting eight hours or more. The government injected 700 million patacas in the company through an increase in issued share capital in 2011. At the time Air Macau said the capital injection would allow the airline to upgrade its aircraft fleet.

May April24, 19,2013 2013

Macau

Q1 data services boost CTM profit Macau’s dominant telco keeps coining it in despite service interruptions Vítor Quintã

vitorquinta@macaubusinessdaily.com

he earnings of the city’s biggest telecommunications company, Companhia de Telecomunicações de Macau, SARL (CTM), jumped in the first quarter of this year, mostly because s u b scr iber s us ed its d ata and roaming services more. CTM shareholder Portugal Telecom SGPS SA told the Euronext Lisbon Stock Exchange that CTM’s first-quarter earnings before interest, tax, depreciation and amortisation had risen to 392 million patacas (US$49 million), 20 percent more than a year earlier. CTM’s profit margin widened to 33 percent from 28.9 percent a year earlier. Revenue rose by 5.4 percent to 1.2 billion patacas as subscribers used data and roaming services more. Data accounted for 25.5 percent of wireless network revenue. Portugal Telecom said CTM had “launched several marketing campaigns aimed at increasing penetration of smartphones and wireless broadband”. Portugal Telecom owns 28 percent of CTM, which it has agreed to sell to Citic Telecom International Holdings

CTM’s revenue growth was driven by an increase in the use of its data and roaming services

Ltd for US$411.6 million. Citic Telecom, a subsidiary of China’s state-owned Citic Group Corp, will also pay US$749.7 million for the 51 percent of CTM held by Britain’s Cable & Wireless

Communications Plc. In its annual report, released yesterday, Cable & Wireless describes its interest in CTM as a “discontinued operation” and said Citic Telecom’s acquisition

MIN

should be completed “between July and October”. Hong Kong-listed Citic Telecom now needs only the approval of the Macau government to increase its stake in CTM to 99 percent from 20 percent. The director of the Telecommunications Regulation Bureau, Lawrence Tou Veng Keong, said last week that Citic Telecom’s plans to correct CTM’s deficiencies would be a factor in the government’s decision. Technical failures have interrupted CTM’s services several times in the past 12 months. The latest interruption was late on Wednesday, when elements of CTM’s third-generation wireless network for prepaid subscribers and its internet service failed to function for several hours. The company said the breakdown was due to its central storage and backup systems malfunctioning. The telecommunications regulator asked CTM to make a preliminary report on the interruption within 24 hours, and has set up a committee to follow it up.

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May 24, 2013 April 19, 2013

Greater China Lenovo full-year profits jump 34 pct Lenovo Group Ltd reported a 34 percent gain in full-year profit after increasing its market share and boosting smartphone sales. Net income climbed to US$635 million in the 12 months ended March from US$473 million a year earlier, the company said in a statement yesterday. The company posted net profit of US$126.9 million in the quarter ended March, up from US$66.8 million a year earlier. Lenovo is developing mobile devices such as smartphones and tablets as it seeks to lure customers from competitors and weather a global slump in demand for PCs.

Factory output hits seven-month low HSBC’s preliminary May data indicates manufacturing contracted Aileen Wang and Koh Gui Qing

cyclical policy move as long as the job market is fine,” she said. “China is really on a path of structural [growth] deceleration. It’s possible [to meet the growth target] but it’s becoming increasingly difficult.”

Soft demand

Factory contraction – signs that economic growth is losing stea

hina’s factory activity shrank for the first time in seven months in May as new orders fell, a preliminary manufacturing survey showed, entrenching fears that its economic recovery has stalled and that a sharper cooldown may be imminent. The preliminary reading of 49.6 for a Purchasing Managers’ Index released yesterday by HSBC Holdings Plc and Markit Economics compares

with a final 50.4 for April. It was under the 50-point level demarcating expansion from contraction for the first time since October. The lack of vigour in the world’s second-biggest economy implies its ability to meet the government’s 7.5 percent growth target this year is increasingly difficult, analysts said, albeit it is still possible. The soft data also sharpens Beijing’s policy dilemma over

whether to act to stabilise activity, or tolerate an orderly slowdown while focusing on reducing the country’s dependence on exports and investment for growth, changes that would bring longer-term benefits. Yao Wei, an economist at Societe Generale Group in Hong Kong, said the debate favours policy inaction from Beijing for now, as long as economic growth remains above 7 percent. “We don’t think it will trigger any

The PMI survey suggested China is up against weakness both at home and abroad. A sub-index measuring overall new orders dropped to 49.5, the lowest reading since September, suggesting domestic consumption is not strong enough to offset soft global demand. Asian stock markets extended early losses after the report. Oil, copper and rubber prices also retreated, while the Australian dollar skidded. Yesterday’s PMI revived investor worries about whether China can sustain an economic revival this year, after annual growth slumped to a 13year trough in 2012. China’s factory output and investment performance for April released earlier this month had already underwhelmed markets. The run of dismal data reports have prompted economists to slash their growth forecasts for China. UBS AG this week downgraded its 2013 growth target for China to 7.7 percent, from 8 percent, and Societe Generale is in the midst of lowering its estimates. Bank of America-Merrill Lynch cut its China 2013 growth forecast earlier this month to 7.6 percent from 8 percent. If the economy meets the government’s growth target and expands 7.5 percent this year, it

Taiwan curbs bullish currency bets As weaker yen threatens island’s exports

aiwan, seeking to rein in the local dollar and boost export competitiveness, tightened limits on domestic banks’ bullish bets on the currency following the yen’s tumble to the lowest level since 2008. The Central Bank of the Republic of China (Taiwan) reduced the daily cap on the net U.S. dollar short position that can be held by each bank to US$5 million from US$10 million, according to Spencer Lin, director general of foreign exchange. The rule, which aims to “stabilise” the Taiwan dollar, came into effect yesterday, he said. A short position in the greenback is a bet on depreciation against the local currency and traders

were informed of the clampdown on Wednesday. The island’s electronics exporters are struggling to compete against Japanese rivals after the local dollar strengthened 22 percent to a fiveyear high versus the yen in the past six months. Gross domestic product increased in the first quarter at less than half the pace economists estimated, putting pressure on policy makers to weaken the currency to protect overseas sales. “It’s very apparent that the central bank wants to send the local currency lower,” said Frances Cheung, a strategist at Credit Agricole CIB in Hong Kong. “The Taiwan dollar

has been depreciating against the greenback lately, but the yen depreciates even more. The purpose is to keep Taiwan’s goods competitive in overseas trade.” Taiwan is seeking to support overseas shipments that slumped 1.9 percent in April after the yen slid 20 percent against the greenback in the past six months and touched 103.74 per dollar yesterday, its weakest level since October 2008. The island’s currency fell 2.7 percent in the same period. Taiwan’s GDP rose 1.54 percent in the three months ended March from a year earlier, after increasing 3.72 percent in the fourth quarter,

official data show. Last year’s 1.3 percent annual growth rate was the slowest since a 1.9 percent contraction in 2009. Overseas demand for the island’s products remains weak. Export

May April24, 19,2013 2013

Greater China Beijing urged to spur auto industry China should refrain from “micromanaging” the automotive industry and allow market competition to spur innovation and weed out weaker automakers, the Chinese Academy of Social Sciences said in a report. The government should focus instead on building a fair and competitive environment and abandon monopolistic polices aimed at creating fewer and bigger automakers, the state-backed research institute said. “This isn’t to say the government isn’t important. On the contrary, it is asking more of the government, to transform from being a direct participant to that of an enabler.”

would still be its worst performance in 23 years. The HSBC flash PMI comes about a week before the final reading and is the earliest indicator of how the Chinese economy is faring each month. The PMI survey showed new export orders hovered below the 50-point level in May, though the rate of decline slowed from April. Still, the weak showing implied foreign demand remained lethargic due to a patchy U.S. recovery and Europe’s nagging debt crisis, and echoes weak export momentum seen in Taiwan and South Korea in May. In a reflection of the cooldown in the vast factory sector, both indices for input and output prices stayed muted in May to be near troughs seen in the third quarter last year. “A sequential slowdown is likely in the middle of the second quarter, casting downside risks to China’s fragile growth recovery,” said Qu Hongbin, an economist at HSBC. Yet, barring a slump in the labour market, most analysts believe Beijing will opt to stay on the policy sidelines. Measures such as reducing corporate taxes may be enacted, but only as part of broader tax reforms, not to pump-prime growth. Reuters

KEY POINTS HSBC flash PMI dips to 7-month low on weak demand Domestic and export orders soft Raises worries on growth outlook this year Govt may tolerate slower growth for reforms

EU solar duties seen hurting companies Businessmen say there will be no winners in Europe

The dawn of punitive duties is already pushing up panel prices

he European Union is poised to penalise imports of Chinese solar products, a move that would increase Europe’s cost for most photovoltaic panels an estimated 45 percent overnight. While officials from the U.S., China and the EU have engaged in preliminary talks to settle a dispute over trade in solar-energy products, according to people familiar with the situation, the EU this week said it will stick to its June 6 deadline to decide whether to impose import duties. The EU proposal for tariffs would hurt manufacturers such as China’s Trina Solar Ltd and raise costs to build power plants in Europe, the world’s largest market for solar products and one largely supplied by Chinese manufacturers. Duties will trigger “an increase in prices that is a major concern for Chinese producers as well as developers in the region, who may find that many solar projects are no longer viable,” according to Jenny Chase, Bloomberg New Energy Finance’s chief solar analyst. “The proposed anti-dumping tariffs are

Regulator tightens scrutiny after fake-export reports orders, indicative of shipments in the next one to three months, slumped 1.1 percent in April from a year earlier, declining for a third straight month. Bloomberg News

hina’s foreign-exchange regulator told banks to improve checks of customer documents related to special trade zones amid speculation that the areas have been exploited to disguise capital inflows as exports.

higher than the industry expected.” The penalties would target at least 20 billion euros (US$26 billion) of goods from China for alleged dumping, or selling below cost. That won’t be enough to revive a withering solar manufacturing industry in Europe, according to Ash Sharma, a senior director of solar at research firm IHS Inc. In Europe, more than two dozen manufacturers have sought protection from creditors since 2010 and many have shifted production to lower-cost factories in Asia. Germany’s Q-Cells SE, which was acquired last year by South Korea’s Hanwha Group, has its largest factory in Malaysia. Norway’s Renewable Energy Corp. has moved most of its manufacturing to Singapore.

‘Too late’ “This really is too late to have a positive impact on manufacturing in Europe,” said Mr Sharma. “Many makers have either exited the market or shifted production already.” The EU move targets Chinese-

Banks shouldn’t provide cross-border payment services to companies in the so-called bonded zones that aren’t pre-registered with the foreign-exchange authority, according to a notice issued yesterday by the State Administration of Foreign Exchange that takes effect June 1. If an exporter decides to deposit its revenue overseas, banks must know the size, duration and remittance arrangements, SAFE said. Bonded zones, which lie within the nation’s borders and handle inbound and outbound shipments as international trade, may help account for inflated data on export growth this year, according to Bank of America Corp and Royal Bank of Scotland Group Plc. SAFE’s notice follows a May 5 statement that it

made, silicon-based photovoltaic panels, and the cells and wafers used to make them. The average price of Chinese panels such as those made by Trina or Yingli Green Energy Holding Co. in Europe may rise an average of 45 percent to US$0.97 a watt in June from this month, slowing demand in the region, according to IHS. The tariffs also would have beneficiaries. They may open doors for low-cost Taiwanese and Malaysian producers such as solarcell maker Motech Industries Inc. The Obama administration has engaged in preliminary talks with the EU and China to settle disputes in their markets, according to people familiar with the discussions. The European Commission, the EU’s executive arm in Brussels, said in an e-mail its anti-dumping law doesn’t allow such negotiations before provisional duties are first imposed. Orta Solar Ltd, a developer of solar installations in the U.K., said the EU levy would force it to consider postponing more than 180 million pounds (US$273 million) of solar parks. “We no longer know whether it will be economically viable to construct U.K. commercial-scale solar farms later in 2013 and beyond,” Orta managing director Nick Pascoe said in an e-mail. Imposing duties in the EU would be “a lose-lose situation,” Terry Wang, chief financial officer of Trina Solar, said in an interview. “No one wins. Demand in Europe will be squeezed. It will drive out investors; they won’t invest because the margins are so low.” Tariffs may drive many small installers and developers, which rely on cheap panels in the face of declining feed-in tariffs, out of business, said Thierry Lepercq, chief executive of Solairedirect SA, a Paris-based developer. “If the duties are actually enforced, there will be no winners in Europe,” he said. The preliminary decision is due before June 6 and will directly affect more than 100 Chinese manufacturers, an official said. A final ruling is expected in December. In a separate action, the EU may also impose anti-subsidy duties in August. Bloomberg News

will increase scrutiny of cross-border capital flows. “The problem of inflated export data is clearly there, and it shows that SAFE is trying to tackle it,” said Ken Peng, a BNP Paribas SA economist based in Beijing. “China’s economic-growth data is partly supported by an artificially high net export contribution in the first quarter, and that support will fizzle away as SAFE steps up controls.” Zheng Yuesheng, a spokesman for the General Administration of Customs, said last month that China is investigating possible fraud behind first-quarter export growth and said the practice of false trade declarations “does exist but is definitely not mainstream”. Bloomberg News

May 24, 2013

Asia

Japan shares plunge in broad sell-off Stocks slump most since 2011 as dollar rises

apan’s stocks fell the most since the aftermath of the Fukushima disaster, leading equities lower, while metals sank on disappointing Chinese manufacturing data. The dollar rose against most of its major peers after Federal Reserve chairman Ben S. Bernanke sparked speculation the central bank may cut bond purchases. Japan’s Topix Index slumped 6.9 percent, the most since March 2011. Copper in London sank 2.9 percent and oil dropped 0.8 percent. The dollar gained at least 0.9 percent against the Australian and South Korean currencies. Manufacturing in China unexpectedly contracted for the first time in seven months, a report from HSBC Holdings Plc and Markit Economics showed. The Topix had surged 48 percent this year to yesterday as the Bank of Japan pledged unprecedented monetary stimulus to bolster growth. In testimony to lawmakers on

Wednesday U.S. time, Mr Bernanke said a premature withdrawal of stimulus could endanger U.S. economic recovery as policy makers debated tapering the pace of its bond purchase programme. “Weak data from China combined with speculation the Fed may phase out quantitative easing are causing jitters,” said Paul Joseph Garcia, who helps manage the equivalent of US$18 billion as Manila-based head of institutional business at BPI Asset Management Inc. “The tactical strategy is to be on the defensive – increase cash and reduce exposure to risky assets.”

Topix slump The May preliminary reading for HSBC and Markit’s Chinese Purchasing Managers’ Index was 49.6, down from April’s final 50.4 level. A reading below 50 indicates contraction. The MSCI Asia Pacific Index sank

3.6 percent, the most since September 22, 2011, as Hong Kong’s Hang Seng Index and Australia’s S&P/ASX 200 Index slumped more than 2 percent. The Topix’s relative-strength index reached 78 yesterday, above the 70 level that some traders use as a signal to sell. The index’s drop was the most since the aftermath of a tsunami and earthquake that caused the Fukushima power-plant disaster two years ago. Trading in Nikkei 225 Stock Average futures was halted after a slump in the contracts triggered circuit breakers. The Nikkei tumbled 7.3 percent as Fast Retailing Co., the gauge’s largest constituent, sank 8 percent. The stock measure has soared 39 percent this year. Japanese equities had risen “too much, too fast,” particularly financial stocks, and need “some kind of correction” before they can resume their climb, former Ministry of Finance official Eisuke Sakakibara said in a May 15 interview.

S.Korea urged to keep easy policy Government think tank says economic growth still slow Choonsik Yoo

outh Korea needs to maintain an expansionary monetary policy for a longer period as the economy is growing slower than forecast while inflation eases to a 14year low, a government think tank said yesterday. Corporate investment in industrial plants and equipment would grow by only about half the pace seen previously even after registering the second-worst decline in 11 years in 2012,the Korea Development Institute (KDI) said in a report. Private consumption will not recover as fast as previously expected, it said, as separate data released early in the day provided further evidence that consumers were cutting down on spending due to uncertain economic prospects. “[The central bank] needs to operate its policy in a flexible manner depending on future inflation and economic conditions while keeping the currently accommodative stance for the time being,” the KDI said. It forecast this year’s economic growth at 2.6 percent and inflation at 1.8 percent, which will mark the lowest level since 1999, compared with its previous projections released in November for 3.0 percent and 2.3 percent, respectively. Last year, South Korea’s economy, the fourth-largest in Asia, grew by a provisional 2.0 percent and inflation was at 2.2 percent on an annual average basis. The KDI is affiliated with the Ministry of Strategy and Finance and Minister Hyun Oh-seok was the chief of the institute until he was picked

Weak data from China combined with speculation the Fed may phase out quantitative easing are causing jitters Paul Joseph Garcia, BPI Asset Management

Orix Corp. slumped 12 percent, leading declines among Japanese financial shares. Mitsubishi Estate Co., the nation’s biggest developer by market value, sank 9.3 percent. Mitsubishi Motors Corp fell 14 percent after the Nikkei newspaper said the carmaker will reorganise

Ford exits Australia amid mounting losses U.S. carmaker to halt production in 2016 blaming high costs

South Koreans cutting down on spending

by President Park Geun-hye, who took office in late February, as her finance minister. In November, the KDI recommended the Bank of Korea cut interest rates to support the exportreliant economy, a policy advice that the central bank followed early this month by cutting its benchmark interest rate. The government of President Park has cut this year’s economic growth projection to 2.3 percent from 3.0 percent set by the previous government and introduced a supplementary budget including US$5 billion worth of stimulus plans. It said this year’s capital spending would grow by just 2.8 percent from last year, about half the 5.3 percent expansion seen in its November

projection and following a 1.9 percent decline last year. Private consumption, which generates more than half of the a n n u a l eco n o m i c o u t p u t , w i l l probably grow 2.3 percent this year after a 1.7 percent gain last year. Data from the industry ministry and the central bank showed sales at the country’s top retail chains posted sharp declines year-on-year in April while household credit growth eased to a more than 8-year low by the end of March. Early this month, the Bank of Korea cut its policy interest rate by a quarter of a percentage point to 2.50 percent, a surprise move partly seen as aimed at mitigating the upward pressure on the won after the yen’s slide. Reuters

ord Motor Co will shut its two Australian auto plants in October 2016, blaming a strong currency and costs that are hitting manufacturers just as the country looks for other sectors of its economy to cushion the end of a mining boom. Ford Australia will close its engine plant in Geelong and its vehicle assembly plant in Broadmeadows, both in Victoria state, with the loss of 1,200 jobs, Ford Australia chief executive Bob Graziano said yesterday, the latest electionyear blow to the struggling Labor government. Ford, which built 37,000 vehicles in Australia last year, has been in the country since 1925 and employs more than 3,000 people. But it has been battling sliding sales, high costs and an Australian dollar trading above the U.S. currency. “Our costs are double that of Europe and nearly four times Ford in Asia,” Mr Graziano said. “The business case simply did not stack up. Manufacturing is not viable for Ford in Australia.” Ford’s decision to close its local

May 24, 2013

Asia

Nissan recalls over 800,000 vehicles N

The Topix had surged 48 percent this year

capital to offset losses. The yen rose 1.3 percent to 101.87 per dollar as it strengthened against all 16 of its major peers. Japan’s 10year bond yield declined five basis points to 0.84 percent in Tokyo, according to Japan Bond Trading Co. It earlier climbed to 1 percent, a

level unseen since April 5 last year. Trading volumes on benchmark stock indexes in Japan, Australia, Taiwan and Singapore were more than 60 percent higher than their 30-day averages, according to yesterday’s data. Bloomberg News

AirAsia net profit hit by higher costs A

issan Motor Co Ltd will recall about 841,000 vehicles worldwide including the Micra compact car, also known as the March, as a result of a steering wheel glitch, Japan’s No.2 automaker said yesterday. Nissan is recalling certain models of the Micra compact car produced in Britain and Japan between 2002 and 2006, as well as the Cube, produced in Japan around the same period. It is pulling back vehicles in Japan, Europe, Asia, Oceania, Africa, Latin America and the Middle East. The bolt used in the steering wheel of these cars may not have been properly tightened and at worst the steering wheel may not function, Nissan said in a statement filed to the Japanese transport ministry. No accidents, injuries or deaths have been reported, Nissan spokeswoman Noriko Yoneyama said. But drivers will notice if the steering wheel is getting loose, the company added. Nissan will fix the glitch by either tightening the bolts or replacing the steering wheel with a new one. The repair will take about 40 minutes, Ms Yoneyama said. She declined to say how much the recall will cost Nissan. Earlier this month, Nissan recalled 500,000 vehicles globally over a defect in passenger airbags.

irAsia Bhd, the region’s biggest budget carrier, reported its first drop in profit in five quarters as higher fuel and finance costs eroded gains from carrying more passengers. Net income fell 39 percent to 104.8 million ringgit (US$35 million) in the three months ended March 31, the Malaysia-based airline said in a statement. Revenue climbed 11 percent to 1.30 billion ringgit. Group chief executive Officer Tony Fernandes said the carrier has potential for “double digit” growth this year as AirAsia expands to India and increased its bet in the Philippines with a 49 percent stake in Zest Airways Inc. The carrier said jet fuel costs rose 18 percent in the quarter to 523 million ringgit, while aircraft lease expense climbed 11 percent to 44.7 million ringgit. AirAsia also had a foreign exchange loss of 37.7 million ringgit on its borrowings, compared with a gain of 88 million ringgit a year earlier. Such expenses eroded gains from carrying more passengers and charging higher fares. AirAsia’s passenger numbers rose 7 percent to 5.2 million in the period, and average fares increased by 2 percent, according to the statement. The group is awaiting approval and hopes to start operations in India in the fourth quarter, Mr Fernandes said yesterday.

Reuters

Financial services boost Singapore’s GDP growth First quarter expansion reduces pressure to ease policy

Ford began manufacturing in Australia in 1925

production highlights the challenges the country faces as a near decadelong mining boom begins to fade. Policymakers hope other sectors of the economy such as manufacturing, construction and retail will start to pick up the slack, but evidence has been scant so far. The Australian dollar has traded above parity with the U.S. dollar for most of the past two years – it fell to about 97 cents only this week – making it more difficult for local manufacturers to compete globally. Mr Graziano said Ford had lost A$600 million (US$581 million) in the last five years in Australia, and A$141 million in the last fiscal year, as customers turned to smaller imported vehicles built by Japan’s Mazda Motor Corp and South Korea’s Hyundai Motor Co. The country’s Performance of Manufacturing index fell to a four-year low in April, indicating continuing contraction in the sector despite record low interest rates of 2.75 percent.

“Australia’s manufacturing sector continues to under-perform other parts of the globe,” CommSec Economist Savanth Sebastian said in a research note this month. “The main difference is the strength of the Aussie dollar, which clearly is causing businesses to markedly re-assess the viability of ongoing operations as well as strategic direction,” he added. Reuters

A$600 mln

Ford says it has lost in the last five years in Australia

ingapore’s economy unexpectedly expanded last quarter as services and construction strengthened, reducing pressure on the central bank to ease monetary policy to boost growth. The city-state, whose economy is heavily dependent on trade, manufacturing and financial services, said gross domestic product expanded 1.8 percent in January-March on a quarter-on-quarter, seasonally adjusted and annualised rate, much better than the advance estimate of a 1.4 percent contraction. The expansion, which handily beat the forecasts of all economists polled by Reuters, was due to a 50.6 percent quarterly surge in finance and insurance that more than offset a 12.3 percent contraction in manufacturing. The surprisingly positive GDP numbers were followed by data that showed industrial production rose 4.7 percent in April from a year ago, also beating analysts’ expectations, as electronics gained 1.1 percent and pharmaceuticals surged 48.0 percent. Singapore has been grappling with slow growth and relatively high inflation in recent years amid weakness in key export markets as well as tighter local restrictions on foreign workers that have raised costs and made it

harder for successful firms to expand. Non-oil domestic exports, a measure of the manufacturing sector’s health since Singapore exports most of what it produces, had declined in the preceding three quarters amid persistent weakness in global demand. Chua Hak Bin, Southeast Asia economist at Bank of America Merrill Lynch, said the labour restrictions have hit Singapore manufacturers a lot harder and there is a de-coupling between manufacturing and services. “Singapore’s weakness has been overstated because a lot of data that people look at is manufacturingrelated… But loan growth bottomed in the fourth quarter of last year and trading activity is up, driven by the surge in global liquidity,” he said. Singapore’s Ministry of Trade and Industry reiterated its growth forecast of 1-3 percent for 2013 and said it expects the economy to improve gradually over the course of the year, even as a widely followed index showed China’s factory activity shrank for the first time in seven months in May. Manufacturing accounts for about 20 percent of GDP while financial services contribute around 12 percent. Reuters

May 24, 2013

Markets Hang Seng Index NAME

PRICE

DAY %

VOLUME

AIA GROUP LTD

34.7

-3.342618

30640012

CHINA UNICOM HON

ALUMINUM CORP-H

3.14

-2.786378

27310689

CITIC PACIFIC

BANK OF CHINA-H

3.66

-2.139037

473130267

BANK OF COMMUN-H

6.03

-2.741935

33000912

BANK EAST ASIA

30.65

-1.605136

3631572

BELLE INTERNATIO

11.94

-4.48

32801840

27.2

-1.627486

13622971

BOC HONG KONG HO

NAME

CLP HLDGS LTD

PRICE

DAY %

Volume

PRICE

DAY %

11.04

-4.234282

42640764

NAME POWER ASSETS HOL

73.55

-0.473613

6168161

9.32

-3.917526

20403108

SANDS CHINA LTD

39.75

-2.930403

13706726 10666566

68.2

-1.516245

5860857

SINO LAND CO

12.24

-1.923077

14.06

-2.496533

82194939

SUN HUNG KAI PRO

108.2

-3.306524

9946096

11.1

-2.116402

12409768

SWIRE PACIFIC-A

101.2

-1.747573

1749773

ESPRIT HLDGS

11.46

-0.8650519

17400921

TENCENT HOLDINGS

292.8

-3.366337

5457917

HANG LUNG PROPER

29.35

-3.453947

6804885

TINGYI HLDG CO

19.64

-3.72549

14808000

11.62

-3.648425

16881677

-4.336735

7494328

CNOOC LTD COSCO PAC LTD

CATHAY PAC AIR

14.04

-4.229195

6064867

HANG SENG BK

127

-1.320901

1790720

WANT WANT CHINA

CHEUNG KONG

115.8

-2.360877

5165797

HENDERSON LAND D

56.8

-1.131419

8332188

WHARF HLDG

CHINA COAL ENE-H

5.31

-4.324324

38606679

86.75

-1.026811

3028330

CHINA CONST BA-H

6.3

-2.325581

326655432

CHINA LIFE INS-H

21.05

-2.546296

51088166

CHINA MERCHANT

24.95

-1.964637

4365083

CHINA MOBILE

Volume

HENGAN INTL HONG KG CHINA GS HONG KONG EXCHNG HSBC HLDGS PLC

-1.918977

12694742

130.1

-2.765321

6725708

87.1

-2.572707

25572861

83.35

-1.709906

26217912

HUTCHISON WHAMPO

85.9

-2.052452

9484837

CHINA OVERSEAS

23.5

-1.878914

19704530

IND & COMM BK-H

5.38

-2.712477

567179867

CHINA PETROLEU-H

8.28

-3.157895

120847901

10.88

-4.393673

33145555

CHINA RES ENTERP

24.5

-0.4065041

18861078

31.3

-3.395062

3554939

CHINA RES LAND

23.3

-1.687764

8962532

NEW WORLD DEV

13.24

-2.932551

13593871

CHINA RES POWER

20.1

-0.248139

16832481

PETROCHINA CO-H

9.43

-2.883625

117321804

CHINA SHENHUA-H

25.9

-3.717472

30067188

PING AN INSURA-H

-3.199344

17588977

LI & FUNG LTD MTR CORP

MOVERS

0 23435

INDEX 22669.68 HIGH

23441.04

LOW

22649.52

52W (H) 23944.74 (L) 18056.4

22640

21-May

23-May

Hang Seng China Enterprise Index NAME

PRICE

DAY %

VOLUME

AGRICULTURAL-H

3.67

-2.393617

119225000

AIR CHINA LTD-H

6.65

-2.492669

7719280

ALUMINUM CORP-H

3.14

-2.786378

ANHUI CONCH-H

26.75

BANK OF CHINA-H

NAME

PRICE

DAY %

Volume

CHINA PACIFIC-H

27.4

-3.521127

8086756

CHINA PETROLEU-H

8.28

-3.157895

120847901

27310689

CHINA RAIL CN-H

7.88

-2.233251

8767930

-2.014652

13214929

CHINA RAIL GR-H

4.07

-2.163462

21141620

3.66

-2.139037

473130267

CHINA SHENHUA-H

25.9

-3.717472

30067188

BANK OF COMMUN-H

6.03

-2.741935

33000912

CHINA TELECOM-H

3.88

-3.960396

99388884

BYD CO LTD-H

31.3

-5.580694

7954800

DONGFENG MOTOR-H

12.08

-3.205128

20927952

CHINA CITIC BK-H

4.35

-2.684564

40625007

GUANGZHOU AUTO-H

7.83

-5.776173

21664322

CHINA COAL ENE-H

5.31

-4.324324

38606679

HUANENG POWER-H

8.15

2.644836

85075703

CHINA COM CONS-H

7.52

-4.447268

25025311

IND & COMM BK-H

5.38

-2.712477

567179867

CHINA CONST BA-H

6.3

-2.325581

326655432

JIANGXI COPPER-H

15.52

-2.634881

22101953

3.47

-3.878116

10582647

PETROCHINA CO-H

9.43

-2.883625

117321804

21.05

-2.546296

51088166

PICC PROPERTY &

9.86

-2.18254

16404248

CHINA LONGYUAN-H

7.72

-0.2583979

17534407

PING AN INSURA-H

-3.199344

17588977

CHINA MERCH BK-H

16.02

-4.071856

27177277

SHANDONG WEIG-H

8.35

-0.8313539

13454780

CHINA MINSHENG-H

9.72

-3.379722

56459955

SINOPHARM-H

CHINA NATL BDG-H

9.02

-1.204819

43140000

TSINGTAO BREW-H

15.88

-2.696078

6212256

WEICHAI POWER-H

CHINA COSCO HO-H CHINA LIFE INS-H

CHINA OILFIELD-H

-2.654867

4017130

54.55

1.018519

1724360

29.65

-4.200323

NAME

PRICE

DAY %

Volume

YANZHOU COAL-H

8.19

-2.731591

48595617

ZIJIN MINING-H

2.14

-2.283105

44840020

ZOOMLION HEAVY-H

8.06

-4.047619

28155342

ZTE CORP-H

12.8

-1.081917

3290055

MOVERS

0 11160

INDEX 10746.7 HIGH

11157.35

LOW

10741.71

52W (H) 12354.22 (L) 8987.76

10740

21-May

4483557

23-May

Shanghai Shenzhen CSI 300 PRICE

DAY %

Volume

PRICE

DAY %

Volume

CHINA YANGTZE-A

7.57

-1.303781

18749054

POLY REAL ESTA-A

12.25

-1.209677

60918937

8528874

CHONGQING CHAN-A

10.8

-3.052065

52876505

QINGDAO HAIER-A

12.91

-0.6923077

9455639

-0.9569378

16964582

CHONGQING WATE-A

6.58

-1.349325

8454652

QINGHAI SALT-A

23.23

-2.640402

6073120

17.31

-3.242035

32270320

CITIC SECURITI-A

12.56

-2.256809

90966496

RISESUN REAL -A

11.63

2.829355

56955384

CSR CORP LTD -A

4.23

-1.856148

34210396

SAIC MOTOR-A

BANK OF BEIJIN-A

8.95

-2.185792

27255138

DAQIN RAILWAY -A

-0.7092199

34984191

SANY HEAVY INDUS

BANK OF CHINA-A

2.93

-1.013514

30817303

DATANG INTL PO-A

4.69

-0.6355932

18079371

BANK OF COMMUN-A

4.73

-1.25261

54419948

EVERBRIG SEC -A

13.63

-2.433787

BANK OF NINGBO-A

10.55

-1.217228

15020624

GD MIDEA HOLDI-A

14.26

BAOSHAN IRON & S

4.87

-1.417004

15740955

GD POWER DEVEL-A

BEIJING TONGRE-A

23.03

-1.412671

12519235

BYD CO LTD -A

34.82

-6.52349

22641903

CHINA AVIC ELE-A

26.63

1.254753

7938060

CHINA CITIC BK-A

4.38

-2.449889

CHINA CNR CORP-A

4.45

CHINA COAL ENE-A CHINA CONST BA-A

NAME

PRICE

DAY %

VOLUME

AGRICULTURAL-A

2.73

-1.086957

109718453

AIR CHINA LTD-A

5.41

-1.814882

ALUMINUM CORP-A

4.14

ANHUI CONCH-A AVIC AIRCRAFT-A

NAME

2.629891

21349325

15.31

-3.467844

42618711

9.52

-2.158273

24971977

SHANG PHARM -A

12.54

2.034174

32321389

22913938

SHANG PUDONG-A

10.15

-2.027027

82484743

-1.858224

10075886

SHANGHAI ELECT-A

3.92

6285541

2.67

-1.476015

138416192

SHANXI LU'AN -A

16.4

-3.130538

20465564

GEMDALE CORP-A

7.86

0.7692308

82538688

SHANXI XISHAN-A

10.6

-2.84143

17021842

GF SECURITIES-A

13.59

-1.235465

26821701

SHENZEN OVERSE-A

6.39

-1.540832

73191421

GREE ELECTRIC

26.79

-3.320101

21320818

SUNING COMMERC-A

6.24

57051505

36252828

GUANGHUI ENERG-A

19.11

-0.7272727

16921788

TASLY PHARMAC-A

41.6

3.405419

10540524

-1.548673

34213441

HAITONG SECURI-A

11.14

-2.194908

117204917

TSINGTAO BREW-A

38.31

-1.237432

1793859

6.79

-1.451379

10354044

HANGZHOU HIKVI-A

39.37

-1.575

13345077

WEICHAI POWER-A

23.19

-2.808047

9067888

4.81

-1.232033

26827460

HENAN SHUAN-A

38.24

-1.92357

5114116

WULIANGYE YIBIN

23.98

-0.9909166

40443875

CHINA COSCO HO-A

3.4

-1.162791

9204499

HONG YUAN SEC-A

24.45

-0.08173273

31616301

YANTAI WANHUA-A

17.63

-2.272727

11999792

CHINA EAST AIR-A

3.03

-1.302932

15404533

HUATAI SECURIT-A

9.85

-1.5

27699003

YANZHOU COAL-A

14.59

-2.53841

5555245

CHINA EVERBRIG-A

3.12

-1.886792

73416203

HUAXIA BANK CO

10.74

-1.917808

24094033

YUNNAN BAIYAO-A

86.45

0.2900232

1798645

CHINA INTL MAR-A

12.08

-0.902379

6603211

IND & COMM BK-A

4.16

64477222

ZHONGJIN GOLD

12.04

-0.5780347

16983174

CHINA LIFE INS-A

16.52

-2.016607

16927868

INDUSTRIAL BAN-A

18.34

-2.082221

70431000

ZIJIN MINING-A

3.06

-0.9708738

38024699

CHINA MERCH BK-A

13.52

-3.359543

104392717

INNER MONG BAO-A

28.15

-2.662517

30045948

ZOOMLION HEAVY-A

7.29

-1.752022

41283149

CHINA MERCHANT-A

12.92

-1.374046

29107146

INNER MONG YIL-A

28.23

-0.7383966

14560795

ZTE CORP-A

12.54

-1.801096

32302743

CHINA MERCHANT-A

28.75

-2.80595

16101453

INNER MONGOLIA-A

4.82

-1.632653

37307079

CHINA MINSHENG-A

10.41

-2.161654

132496117

JIANGSU HENGRU-A

29.91

1.218274

12535355

CHINA NATIONAL-A

11.35

0.5314438

41381095

JIANGSU YANGHE-A

63.58

-1.502711

5781226

CHINA OILFIELD-A

16.56

0.1814882

6323199

JIANGXI COPPER-A

21.03

-2.773925

11854808

CHINA PACIFIC-A

18.78

-2.542813

16621096

JINDUICHENG -A

10.5

-1.869159

7875377

CHINA PETROLEU-A

6.75

-1.026393

29376265

KANGMEI PHARMA-A

17.76

7.311178

63941682

CHINA RAILWAY-A

5.14

-1.34357

21949272

KWEICHOW MOUTA-A

202.44

1.488946

6224745

CHINA RAILWAY-A

2.85

-1.384083

31199514

LUZHOU LAOJIAO-A

-0.7352941

11730353

CHINA SHENHUA-A

20.79

-1.328904

11593940

METALLURGICAL-A

2.03

-0.9756098

38520878

23.95

1.483051

17587140

2.45

-0.4065041

11125634

CHINA SHIPBUIL-A

4.52

59982923

NARI TECHNOLOG-A

CHINA SOUTHERN-A

3.44

-0.8645533

20324112

NINGBO PORT CO-A

CHINA STATE -A

3.78

-1.04712

96150722

PETROCHINA CO-A

8.51

-0.8158508

13670822

CHINA UNITED-A

3.66

-2.139037

106366076

PING AN BANK-A

20.52

-3.024575

50740941

12.01

-0.7438017

93165082

PRICE DAY %

Volume

CHINA VANKE CO-A

PING AN INSURA-A

39.48

-2.734664

31888053

NAME

PRICE DAY %

Volume

MOVERS

239

12 2630

INDEX 2582.849 HIGH

2625.04

LOW

2582.53

52W (H) 2791.303 (L) 2102.135

2580

21-May

23-May

FTSE Taiwan 50 Index NAME

NAME

PRICE DAY %

ACER INC

24.55

-1.008065

14474276

FORMOSA PLASTIC

71.2

-2.864939

9445233

TAIWAN MOBILE CO

ADVANCED SEMICON

25.85 -0.9578544

16848016

FOXCONN TECHNOLO

80.8

-1.583435

5233683

37.5 -0.7936508

2734973

FUBON FINANCIAL

40.35

-3.23741

ASIA CEMENT CORP ASUSTEK COMPUTER

345 -0.7194245

AU OPTRONICS COR

13.6

TPK HOLDING CO L

603

0.3327787

2974444

34516300

TSMC

108

-3.571429

46623809

UNI-PRESIDENT

60.8

0.1647446

9758589

UNITED MICROELEC

13.4

-3.597122

135206783

1861869

HON HAI PRECISIO

77.1

-1.532567

51955344

-2.857143

177523235

HOTAI MOTOR CO

291

-3

580566

282.5

-2.079723

16365911

WISTRON CORP

17.2

-1.714286

12067769

YUANTA FINANCIAL YULON MOTOR CO

CATCHER TECH

156.5

-1.572327

11008602

HTC CORP

CATHAY FINANCIAL

39.75

-2.811736

32684174

HUA NAN FINANCIA

CHANG HWA BANK

17.05

-1.729107

10557140

LARGAN PRECISION

930

-3.426791

1536654

CHENG SHIN RUBBE

-2.286902

9439441

LITE-ON TECHNOLO

48.4

-3.393214

7636506

19.75

-3.422983

58086289

MEDIATEK INC

370

-3.141361

10698605

8.67

-2.58427

83651516

MEGA FINANCIAL H

23.75

-2.061856

31053455

CHINA STEEL CORP

25.95

-1.142857

14834580

NAN YA PLASTICS

62.5

-2.34375

6646952

CHINATRUST FINAN

18.5

-1.595745

66901177

PRESIDENT CHAIN

185.5

-3.88601

1597825

CHUNGHWA TELECOM

97.6

-0.610998

10741184

QUANTA COMPUTER

64.4

6882838

COMPAL ELECTRON

18.4

-1.075269

22214677

SILICONWARE PREC

-2.173913

11995796

DELTA ELECT INC

144

-1.706485

4970942

SINOPAC FINANCIA

14.55

-2.348993

23746987

FAR EASTERN NEW

32.2

-2.12766

4593255

SYNNEX TECH INTL

43.85

9818967

FAR EASTONE TELE

73.5

-1.076716

5763551

TAIWAN CEMENT

39.35 -0.8816121

6392388

TAIWAN COOPERATI

17.15

-1.436782

15011477

76.7

0.2614379

5960247

29.15

-3.156146

1179577

CHIMEI INNOLUX C CHINA DEVELOPMEN

FIRST FINANCIAL

18.2

-2.150538

15589816

FORMOSA CHEM & F

72.6

-2.288022

7377586

TAIWAN FERTILIZE

FORMOSA PETROCHE

80.7

-3.4689

3069234

TAIWAN GLASS IND

Volume

113.5

MOVERS

29.55 -0.5050505

5876.42

LOW

5711.1

8785974

-3.323263

25094872

51.1

-0.776699

2136430

3 5880

INDEX 5711.1 HIGH

6120987

52W (H) 5896.71 (L) 4719.96

5710

21-May

23-May

May 24, 2013

Markets Gaming Stocks - Daily Performance (Hong Kong Stock Exchange) 38.9

38.6

38.3

Max 38.9

average 38.408

Min 38

38.0

Last 38

Max 63.5

average 63.091

Min 62.4

Last 62.5

63.6

20.8

63.3

20.5

63.0

20.2

62.7

19.9

62.4

Max 20.7

average 19.992

Min 19.64

Last 19.64

20.8

40.8 40.5

24.00 23.65

20.5

40.2

23.30 20.2

39.9

Max 40.7

average 40.202

Min 39.7

39.6

Last 39.75

Max 20.7

average 20.175

Commodities PRICE

DAY %

YTD %

(H) 52W

92.81

-1.559185405

-0.949839915

100.4000015

BRENT CRUDE FUTR Jul13

101.28

-1.286549708

-5.707103622

115.9300003

96.04000092

GASOLINE RBOB FUT Jun13

279.82

-0.751933035

-2.236042205

324.119997

235.9499931

GAS OIL FUT (ICE) Jul13

851.75

-1.92861255

-6.426805823

987.5

814

4.21

0.573339704

20.01140251

4.457000256

3.203999996

284.22

-1.092706013

-5.499401516

323.8899946

258.589983

Gold Spot $/Oz

1386.49

-0.0433

-16.7003

1796.08

1322.06

Silver Spot $/Oz

22.4781

-0.6493

-25.3467

35.365

20.3395

HEATING OIL FUTR Jun13

81.5

Platinum Spot $/Oz

1458.6

-0.6132

-3.8972

1742.8

1374.55

Palladium Spot $/Oz

735.23

-1.9563

5.0839

786.5

553.75

LME ALUMINUM 3MO ($)

1883

1.182160129

-9.165460685

2200.199951

1809

LME COPPER 3MO ($)

7475

1.424694708

-5.749590216

8422

6762.25

LME ZINC

1880

1.566720692

-9.615384615

2230

1745

15175

0.663349917

-11.04923798

18920

14609 14.79500103

3MO ($)

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

15.45

0.717079531

-1.87361067

17.07500076

529

-0.282752121

-11.79658191

665

512

WHEAT FUTURE(CBT) Jul13

694.25

0.835148874

-12.53543307

900

664.75

SOYBEAN FUTURE Jul13

1495.5

0.083654007

7.185092277

1605.75

1217.75

COFFEE 'C' FUTURE Jul13

128.5

0.038925652

-14.07556001

202.1999969

128.25

CORN FUTURE

Last 20

(L) 52W

WTI CRUDE FUTURE Jul13

NATURAL GAS FUTR Jun13

METALS

Min 19.96

Dec13

SUGAR #11 (WORLD) Jul13

16.64

COTTON NO.2 FUTR Jul13

83.34

-0.06006006

-15.704154

-0.095900264

8.416807597

23.05999947 94.19999695

COUNTRY MAJOR

ASIA PACIFIC

CROSSES

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

Max 24

average 23.197

Min 22.7

Last 22.7

NAME

16.55999947

ARISTOCRAT LEISU

69.94999695

CROWN LTD

World Stock Markets - Indices

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

0.9647 1.5066 0.9666 1.2879 101.23 7.9958 7.7629 6.1345 55.805 29.97 1.2656 29.93 41.713 9793 97.657 1.24494 0.85486 7.9045 10.298 130.38 1.03

-1.0868 -0.1789 0.869 -0.4021 1.6793 -0.0225 -0.0232 -0.0538 -0.5913 -0.5672 -0.2924 -0.3943 -1.1459 -0.2349 2.8057 1.2571 0.2211 0.2821 0.3768 2.0785 0

-7.0437 -6.862 -5.2969 -2.3578 -14.9462 -0.1576 -0.1584 1.5665 -1.4515 2.0354 -3.4924 -2.997 -1.6973 0 -8.5299 -3.009 -4.6136 3.9598 2.2567 -12.8931 -0.0097

1.0625 1.6381 0.9972 1.3711 103.74 8.0111 7.7676 6.3964 57.3275 32 1.2971 30.203 43.975 9904 105.433 1.265 0.88151 8.4957 10.9254 133.8 1.032

0.9582 1.4832 0.9022 1.2043 77.13 7.9824 7.7498 6.1291 51.3863 28.56 1.2152 28.913 40.54 9329 74.482 1.20054 0.77553 7.7018 9.6245 94.12 1.029

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

4.27

1.666667

35.55555

4.49

2.29

VOLUME CRNCY 4082919

13.06

0.7716049

22.39925

13.75

8.06

1900261

AMAX HOLDINGS LT

0.81

-2.409639

-42.14286

1.72

0.75

229400

BOC HONG KONG HO

27.2

-1.627486

12.86307

20.85

13622971 300000

0.305

-1.612903

15.09435

0.42

0.215

CHEUK NANG HLDGS

5.77

-0.5172414

-3.672784

6.74

2.8

42000

CHINA OVERSEAS

23.5

-1.878914

1.7316

25.6

15.223

19704530

CHINESE ESTATES

13.94

0.1436782

14.92719

14.12

7.697

397000

CHOW TAI FOOK JE

9.61

-0.9278351

-22.74919

13.4

8.4

7162592

EMPEROR ENTERTAI

2.54

-1.930502

34.39154

2.64

1.12

1510000

FUTURE BRIGHT

2.23

-4.700855

83.98943

2.732

0.765

2676800

-2.93742

25.20593

40.65

16.94

11255978 1790720

COUNTRY

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

DOW JONES INDUS. AVG

15307.17

-0.5225643

16.81171

15542.4

12035.08984

NASDAQ COMPOSITE INDEX

3463.299

-1.108613

14.69725

3532.038

2726.68

FTSE 100 INDEX

6714.43

-1.839693

13.84616

6875.62

5229.76

HANG SENG BK

127

-1.320901

6.992421

132.8

99.2

DAX INDEX

8305.97

-2.636536

9.111194

8557.86

5914.43

HOPEWELL HLDGS

28.75

-2.707276

-13.53383

35.3

19.049

1668158

HSBC HLDGS PLC

87.1

-2.572707

7.134067

90.7

59.8

25572861

NIKKEI 225

14483.98

-7.315934

39.33362

15942.6

8238.96

HANG SENG INDEX

22669.68

-2.542444

0.0563173

23944.74

18056.4

CSI 300 INDEX

2582.849

-1.343947

2.374093

2791.303

2102.135

TAIWAN TAIEX INDEX

8237.83

-1.91705

6.991754

8439.15

KOSPI INDEX

1969.19

-1.235812

-1.395063

S&P/ASX 200 INDEX

5062.446

-1.992483

JAKARTA COMPOSITE INDEX

22.60

Macau Related Stocks

CENTURY LEGEND

NAME

19.9

22.95

Currency Exchange Rates

NAME ENERGY

19.6

GALAXY ENTERTAIN

HUTCHISON TELE H

4.25

1.918465

19.38202

4.66

2.98

8758544

LUK FOOK HLDGS I

19.6

-2.729529

-19.67213

30.05

14.7

1743595

MELCO INTL DEVEL

16.66

-3.139535

84.90566

18.18

5.12

7528969

6857.35

MGM CHINA HOLDIN

19.64

-3.488943

47.91073

20.85

9.509

4644174

2042.48

1758.99

MIDLAND HOLDINGS

3.36

-0.2967359

-9.18919

3.25

3707172

8.894387

5249.6

3985

NEPTUNE GROUP

0.162

-2.994012

6.578951

0.226

0.084

6075000

NEW WORLD DEV

13.24

-2.932551

10.14975

15.12

7.95

13593871

SANDS CHINA LTD

13706726

5116.531

-1.756298

18.52911

5251.296

3635.283

FTSE Bursa Malaysia KLCI

1771.05

-0.7192188

4.861014

1826.22

1535.11

NZX ALL INDEX

982.764

-0.2533341

11.4178

998.487

PHILIPPINES ALL SHARE IX

4485.42

-1.075824

21.26099

4571.4

39.75

-2.930403

17.08394

43.7

20.65

SHUN HO RESOURCE

1.5

7.142859

1.67

1.03

755.149

SHUN TAK HOLDING

4.06

-3.333333

-3.102627

4.65

2.56

8813493

3279.09

SJM HOLDINGS LTD

21435680

SMARTONE TELECOM

-4.988124

11.11111

22.7

12.34

13.52

-1.313869

-3.977272

17.38

12.5

1036694

22.7

-5.219207

8.353218

26.5

14.62

11325694

HSBC Dragon 300 Index Singapor

656.25

-0.04

5.66

STOCK EXCH OF THAI INDEX

1593.57

-2.311083

14.48635

1649.77

1099.15

HO CHI MINH STOCK INDEX

498.22

-0.798439

20.42153

518.46

372.39

ASIA ENTERTAINME

4.93

6.021505

61.11111

5.18

2.4

1322927

BALLY TECHNOLOGI

55.65

0.2522068

24.4688

56.4

41.74

691174

Laos Composite Index

1358.14

11.80223

1455.82

980.83

BOC HONG KONG HO

3.6

17.26385

3.6

2.7

2300

GALAXY ENTERTAIN

5.1

-0.390625

28.46348

5.16

2.25

7153

INTL GAME TECH

18.16

-2.049622

28.15808

18.64

10.92

5012093

JONES LANG LASAL

94.49

-2.224752

12.5685

101.46

61.39

447153

LAS VEGAS SANDS

58.68

-1.34499

27.12305

60.54

32.6127

6195120

MELCO CROWN-ADR

24.41

-0.8529651

44.95249

25.15

9.13

3193965

MGM CHINA HOLDIN

2.6

40.54054

2.67

1.36

500

MGM RESORTS INTE

15.08

-2.960103

29.55326

15.95

8.83

11827188

SHFL ENTERTAINME

16.72

-1.415094

15.31034

17.2199

11.75

300827

SJM HOLDINGS LTD

2.734

0.5147059

18.35498

2.99

1.65

11800

WYNN RESORTS LTD

141.64

-0.5546584

25.91342

144.99

84.4902

1365920

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May 24, 2013

Opinion Because bilateral talks run too great a risk of ‘lost face,’ multilateral discussions probably offer the best prospect for resolution of East Asia’s sovereignty disputes

Overcoming East Asia’s sovereignty disputes Charles Tannock

Foreign Affairs Coordinator for the European Conservatives and Reformists in the European Parliament

hina’s recent elevation of its claim to the Diaoyu Islands to a “core interest” has made the prospect of resolving its sovereignty dispute with Japan, which governs the islands, even trickier. Indeed, the recent publication by the official People’s Daily of two Chinese scholars’ commentary questioning Japan’s sovereignty over even Okinawa suggests that the authorities have scant interest in ending the dispute anytime soon. So, with China hardening its multiple sovereignty claims throughout the South and East China Seas, can any mechanism be found to resolve these conflicts peacefully? Disputes over territorial sovereignty are, perhaps, the thorniest of all diplomatic disagreements. They can seem intractable, because they are directly connected not only to national pride, but also to national security. So it is no surprise that governments are usually reluctant to take even the smallest steps toward resolving such disputes. They fear not only domestic political backlash, but also the prospect that their adversary, or adversaries, will interpret a willingness to compromise as a sign of weakness, and thus become even more demanding.

The ongoing sovereignty disputes in the South and East China Seas – involving China, Taiwan, Japan, the Republic of Korea, Vietnam, Brunei, the Philippines, Indonesia, and Malaysia – are particularly poisonous, because they also carry a heavy burden of historical grievance. Koreans perceive in their dispute with Japan an echo of their country’s long and bitter occupation by Imperial Japan. China associates its South and East China Sea claims with the darkest period in its history – the “century of humiliation,” when foreign powers severely impinged upon its territorial integrity. Today, China’s extraordinarily rapid economic and political rise has disposed both its government and public to seek to redress old wounds from that period, and not to offer anything in exchange along the way.

Multilateral solution But, in today’s Asia, these countries’ behaviour with respect to their sovereignty disputes, and how they respond to others’ actions (and inaction) will have a decisive impact on regional security and prosperity. Indeed, these disputes may prove to be a litmus test of China’s sincerity

regarding its commitment to a “peaceful” global rise. Unless China demonstrates that it can live peacefully with its neighbours, its government’s claim that the international community has nothing to fear from the country’s growing power will be doubted. And the United States’ dexterity in addressing these disputes will help to determine whether America’s strategic “pivot to Asia” contributes to forging a regional security order that is acceptable to an increasingly assertive China. Because bilateral talks run too great a risk of “lost face,” multilateral discussions probably offer the best prospect for resolution of East Asia’s sovereignty disputes. The problem is that China not only is unaccustomed to multilateral procedures, but that it recoils from them. China’s history has not prepared it to work within such a framework, and its yearning for status – even more pronounced now than when it was impoverished – will make it difficult to gain Chinese acceptance of a multilateral solution. As a result, China, which is particularly concerned to keep the U.S. out of the negotiations, prefers to pursue bilateral talks, knowing full

well that such an approach will invariably create a zero-sum game in which one side can be portrayed as protecting its national interest, and the other as having betrayed it. China will need considerable convincing if it is to participate in a framework of regional policy consultation, coordination, and compromise aimed at muting the tensions over sovereignty disputes. But, unless China is brought into such a framework, its sense of isolation will grow, as will the temptation to define its interests in ways that are irreconcilable with those of its neighbours.

Sharing resources Not surprisingly, given its own structures, the European Union prefers the multilateral approach. Since 1995, when China occupied Mischief Reef, a maritime feature claimed by the Philippines, the EU has encouraged the Association of Southeast Asian Nations to strengthen its code of conduct for the region. Even to begin to talk about a regional solution to East Asia’s sovereignty disputes, however, requires preparing the ground. The first step must be to reduce diplomatic tensions. Fortunately, this appears to be taking place. Having gone to

the brink, the leaders of both China and Japan appear to have taken a direct hand in softening their countries’ rhetoric. But no one should think that this lowering of the temperature is permanent. Other steps are needed to create habits of civil diplomacy around hot-button territorial claims. Here, Taiwanese President Ma Ying-jeou’s “East China Sea Peace Initiative,” which calls on all parties to refrain from antagonistic behaviour, resolve disputes through peaceful means, and establish a code of conduct for cooperation in the East China Sea, is a clear step forward. While Taiwan’s sovereignty dispute with Japan over the Diaoyu Islands (called the Senkaku Islands by the Japanese) – involves non-negotiable claims, the resources surrounding the islands can nevertheless be shared, nurturing habits of closer regional cooperation in the process. Ma’s constructive approach to reducing tensions in the region would benefit all parties concerned. Although adversaries may not reach agreement in the short term on the issue of sovereignty, they should be able to find a formula that allows them to share the resources, natural or otherwise, of the islands and the nearby waters. Europe experienced something similar with the sharing of resources in the North Sea. Japan and Taiwan have already started along a parallel road in their joint fisheries talks. It is now time for China and Japan, the region’s two paramount economies, to put their people’s prosperity and security first in the interest of successful shared development. © Project Syndicate

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

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May 24, 2013

Opinion Business

wires

The invisible-border war

Leading reports from Asia’s best business newspapers Jaswant Singh

Former Indian finance minister, foreign minister and defence minister

Jakarta Post Indonesia’s newly installed Finance Minister Chatib Basri says the government has resolved to increase the subsidised fuel price in June. “We have requested the increase in June but the specific date is the President to announce,” he was quoted as saying. The government proposes to increase the price of subsidised premium gasoline by 2,000 rupiahs (20 U.S. cents) to 6,500 rupiahs per litre and the price of subsidised diesel to 5,500 rupiahs. Mr Basri claims the new price will suppress the deficit in the state budget to 2.48 percent and give the government more room to breathe.

Inquirer Business The International Monetary Fund expects the Philippine economy to have expanded by 6 percent in the first quarter on account of robust household consumption and government spending. Shanaka Peiris, IMF resident representative to the Philippines, said that based on their preliminary assessment, strong domestic consumption and public-sector investments more than offset the adverse impact of anaemic exports on the economy’s growth in the first three months of the year. In the first quarter of 2012, the economy grew by 6.3 percent.

Bangkok Post Oishi Group and Fraser and Neave Ltd (F&N), the beverage giants controlled by tycoon Charoen Sirivadhanabhakdi, are moving to reap the benefits from their synergy, starting with a joint logistics system that will see products of both firms reaching new international frontiers, starting with Malaysia and Singapore. ThaiBev achieved sales of 150 billion baht (US$5 billion) last year, expected to increase by 15-20 percent this year. F&N Thailand will also start expanding abroad this year, exporting products to Africa and the Middle East, the company said.

Straits Times Singapore’s economy grew 0.2 percent in the first three months of this year compared with the same period a year ago, defying earlier estimates of a 0.6 per cent contraction. Revealing the final growth numbers, the Ministry of Trade and Industry said the services industry had grown much more strongly than previously thought. The sector grew 2.7 percent in the first quarter, more than double the 1.2 per cent expansion that had been estimated last month based on data from January and February.

half-century after the Sino-Indian War of 1962, the border between China and India remains undefined and a constant source of friction between the world’s two most populous countries. Following three weeks of fighting in 1962, it was agreed to draw a Line of Actual Control (LAC). But, five decades later, the map has yet to be delineated. As a result, both sides routinely send patrols up to the point where they believe the LAC should be – the latest episode being a three-week incursion by Chinese troops into Indian-held territory that began in April. Face-offs in the no-man’s land that lies between where China and India each envisage the LAC are so common that the militaries of the two countries have developed a modus vivendi, whereby one side tells the other to withdraw peacefully. Both sides have routinely abided by the informal protocol that has evolved over the years. But not this time. In the area of Daulat Beg Oldie, near Depsang Plains, in the Ladakh region of Jammu and Kashmir, a patrol of about 15 People’s Liberation Army soldiers crossed into Indianheld territory and set up camp for an extended stay. Stretching from the strategic Karakoram Pass, near Pakistan in the north, the LAC runs south, along the ridges of the eastern Himalayas to the ancient Buddhist monastery town of Tawang. After that, it traces the old McMahon Line drawn in 1914 – and rejected by China as an imperial dictate – to demarcate British India from what was then Tibet. The LAC then meanders until the point where India, China, and Burma meet.

Calculated steps? China’s strategic interest in the line that separates India from a restive Tibet and the troublesome province of Xinjiang is straightforward. For India, Daulat Beg Oldie is an important outpost

near the entrance to the Karakoram Pass and the Siachen Glacier region. So, was China’s incursion into Indian territory an error by a local PLA commander? Or was a more complex calculation in play?

Whether Xi’s appeal to India to “settle the boundary framework quickly” was an exhortation or a warning, other Asian countries can no longer afford to ignore their own border disputes with China

The towering Karakoram Pass was part of the old silk route that connected Ladakh and Kashmir with Xinjiang – now, like Tibet, an “autonomous region” of China. As two observers recently described it, Daulat Beg Oldie was a kind of transfer point for goods to be loaded on to pack ponies “for the cruel journey over the Saser La into the more hospitable Shyok river valley” leading to “Leh, Turtok, or Srinagar [in Kashmir].” India’s parliament, not surprisingly, denounced the Chinese incursion in the harshest possible terms. The government, perplexed at first, tried unsuccessfully to make light of the presence of the PLA troops. A tent competition followed; because China had pitched four, India pitched eight.

The Financial Times quoted Sun Hongnian, a Chinese border expert: “For India, every metre of road and every bunker in that area is a strategic win of territory” that brings them “closer to the main road on our side”. The standoff came to an end on May 6, as suddenly as it had started. India’s foreign minister, having earlier termed the incursion a “localised incident,” had to change his tune under parliamentary pressure, and cautioned China that India might have to reconsider his projected visit to Beijing.

Diplomatic accelerator Was all of this a Chinese effort to obtain, in Henry Kissinger’s words, “strategic deterrence”? Or was it a deliberate push toward realising Chinese President Xi Jinping’s proposal to Indian Prime Minister Manmohan Singh on the sidelines of the BRICS summit in South Africa in March? Xi told Singh that he sought “a fair, reasonable, and mutually acceptable settlement based on mutual understanding and accommodation,” adding significantly, “Let’s settle the boundary framework agreement quickly.” Was the Chinese incursion intended to serve as a sort of diplomatic accelerator?

India should take to heart former Australian Prime Minister Kevin Rudd’s prescient observation that “China, a nation of foreign and security policy realists, respects strategic strength and is contemptuous of vacillation and weakness”. After all, one of the lessons of the 1962 war was that a vacillating response to Chinese aggression is self-defeating, particularly in situations like that posed by the incursion at Daulat Beg Oldie. One thing seems clear from the recent incident: a new dispensation reigns in China, and will continue to guide policy for the next decade under Xi’s leadership. The PLA troops in Daulat Beg Oldie are a reminder that China has no intention of allowing unresolved border issues to be swept under the rug. Indeed, almost simultaneously with the PLA incursion, scholars at an official Chinese think tank questioned Japanese sovereignty over Okinawa. Whether Xi’s appeal to India to “settle the boundary framework quickly” was an exhortation or a warning, other Asian countries can no longer afford to ignore their own border disputes with China. As what happened in Daulat Beg Oldie demonstrates, China’s new leaders are not interested in preserving the status quo. © Project Syndicate

May 24, 2013

Closing Sinopec Engineering falls in HK debut

Euro-area services, factory output rises

Sinopec Engineering Group Co., a unit of China’s biggest refiner, fell 0.4 percent on its trading debut in Hong Kong yesterday after raising US$1.8 billion in the city’s biggest initial public offering of the year. Shares in the company fell from HK$10.50 (US$1.35) to HK$10.46 at the close of trade. Analysts said the debut was hurt by weak market sentiment after the benchmark Hang Seng Index closed down 2.54 percent. Markets were broadly down on signs the U.S. Federal Reserve could soon start tapering off its massive stimulus measures and weak Chinese manufacturing data.

Euro-area services and factory output increased more than economists forecast in May, adding to signs the currency union will emerge from its record-long recession in the second quarter. A composite index based on a survey of purchasing managers in both industries rose to 47.7 from 46.9 in April, London-based Markit Economics said yesterday. A reading below 50 indicates contraction. “We see the euro zone being out of recession in the third quarter,” said Christian Schulz, senior European economist at Berenberg Bank in London. The economy contracted 0.2 percent in the first quarter.

EU in drive against tax evasion Leaders vow to push for global action to curb banking secrecy

they had done nothing unlawful. “We cannot accept that a certain number of companies can put themselves in situations where they escape paying taxes in ways that are legal,” French President Francois Hollande said. “We must coordinate at a European level, harmonise our rules and come up with strategies to stop this.” British Prime Minister David Cameron, who has put tax at the top of the agenda for a meeting of the G8 in Ireland next month, was equally clear about the need for coordination steps. “There is a real chance of seeing the sort of international action that we need to fix this problem,” he said. “You can’t do it on your own, you have to have that international action and that is why I think today has been a bit of a breakthrough.”

he European Commission announced yesterday it was ready to open negotiations with China, one of the EU’s most important trading partners, on an investment protection accord. The announcement comes in the midst of a series of tit-for-tat trade disputes between Brussels and Beijing and as the EU begins talks with Washington on what could be the largest ever Free Trade Agreement. China eyes that development, and similar U.S. initiatives in the AsiaPacific region, with some concern and has asked the EU to open talks on their own FTA, a prospect Brussels has played down, believing an investment accord would be a more suitable first step. “An EU-China investment agreement will help deepen our ties and sends the signal that we are firmly committed to building a strong partnership,” EU Trade Commissioner Karel De Gucht said in a statement. “The agreement needs to secure existing openness and deliver new liberalisation of the conditions for accessing each other’s investment market,” Mr De Gucht added. “Crucially, it should also improve the treatment of investors and their assets – including key technologies and intellectual property rights,” he said. The Commission said that an accord would bring together current separate agreements into one text, with the aim of improving “the protection of EU investments in China as well as Chinese investments in Europe, improving legal certainty regarding treatment of EU investors in China, reducing barriers to investing in China and, as a result, increasing bilateral investment flows”. The Commission added that “it should also, crucially, cover improved access to the Chinese market,” citing a key and longstanding EU concern about trade with China. The Commission said there was “huge potential” to boost investment ties which are relatively modest considering the size of the overall trade relationship, with China counting the EU as its largest export market. In 2011, European companies invested 17.5 billion euros (US$22.6 billion) in China, with flows the other way just 2.8 billion euros. In comparison, EU exports to China totalled US$212 billion last year, with imports of US$334 billion.

Reuters

urope moved closer to ending banking secrecy after Austria dropped objections to sharing data on foreign depositors and the EU focused on negotiating a similar agreement with Switzerland. “It’s a bad day for tax cheats,” Austrian Chancellor Werner Faymann told reporters at a meeting of EU leaders to discuss fighting tax fraud. “We will act jointly and I believe we will manage the exchange of data by the end of the year.” Nearly all EU member states exchange information about which bank account holders receive what interest payments – an agreement known as the Savings Directive. Luxembourg and Austria had not wanted to reveal the names of account holders to other countries and instead allow banks to withhold tax, but under pressure from their European partners both have now agreed to sign up to the code. “The wording we have now is good,” Mr Faymann said, referring to an EU agreement on bank information exchange to be discussed at the summit. “I can agree with that and it’s an important step for Europe.” German Chancellor Angela Merkel described the deal as an ‘enormous step’. “There will finally be an exchange of necessary tax information in the European Union,” she said. The president of the European Council, Herman Van Rompuy, said there was a “strong political will” in Europe to make tax systems fairer. He also said the EU would draft tougher rules this year on banking transparency. He was speaking after summit talks in Brussels. A key goal is to prevent multinational firms exploiting legal loopholes. There is widespread public anger that some big corporations have minimised their tax payments at a time of economic hardship. Tax evasion and avoidance cost EU states 1 trillion euros (US$1.3 trillion) a year – more than was spent on healthcare in 2008. The EU is now promising action against “aggressive tax planning” - that is, the complex yet legal accounting tricks used by some companies to minimise their tax payments.

Closing loopholes The European Commission’s top regulatory official said yesterday in a

Brussels, Beijing ready for talks on investment

EU losing up to 1 trillion euros a year to tax evasion

speech that large companies should disclose how much tax they pay in each country where they operate. Michel Barnier, the European commissioner in charge of drafting business regulation, said large banks will already be obliged to disclose their profits, taxes and subsidies in each member state and in the non-EU countries where they operate. “We will expand these reporting obligations to large companies and groups,” he said. The move follows a report by the U.S. Senate earlier this week that Apple Inc. paid little or no tax on tens of billions of dollars in profits channelled through Irish subsidiaries and that it had negotiated a special corporate tax rate of less than 2 percent. Britain, France and Germany called for stricter rules to stop these companies from aggressively avoiding taxes, while acknowledging