Macau Business Daily, April 25, 2012

Rui Cunha to launch foundation

Fund pays HK$98m for top-floor triplex

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Year I | Number 18 | April 25, 2012 Editor-in-chief | Tiago Azevedo Deputy editor-in-chief | José I. Duarte MOP $ 6.00

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Macau, the key in EU, Lusophone ties

Cotai project

WYNN ‘HOPEFUL’ OF APPROVAL NEXT WEEK C

asino entrepreneur Steve Wynn’s 1.1 billion patacas pledge to the University of Macau Development Foundation may have brought him goodwill on this side of the world if not with investors back home. But it certainly didn’t give him the right to a taller hotel on Cotai.

In a telephone call from Las Vegas, Mr Wynn, chairman

of Wynn Resorts, told Business Daily he was “hopeful” of getting approval of his Wynn Cotai land concession – for which he’s already made a down payment of 500 million patacas – by the time he comes to Macau next week. Though he said he had no inside information that it would happen.

And he would like a taller hotel on Cotai. He’s cur-

rently limited to 120 metres because of the site’s closeness to Macau International Airport. “We didn’t want to complicate the issue of the land by getting into a dispute about height. We figured, ‘Don’t argue, just comply with the regulations,’” the Wynn chairman said. “If the opportunity ever comes up to discuss it, if they bring it up, we’d love

to have more height.”

But Mr Wynn said he wouldn’t press the issue.

“My sense, after ten years in Macau – and I’m very clear on this – is that you present your credentials, you present your idea, you respond to what the government wants; and then you wait until the government acts.”

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Galaxy Macau phase two announcement ‘tomorrow’ Galaxy Entertainment Group is expected to reveal tomorrow a start date for Galaxy Macau phase two on Cotai. Yesterday an institutional investor sold a HK$1.1 billion stake in the company, which has seen a more than 4,000 percent rise in its shares’ value in under four years.

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HSI - Movers Name

%Day

WANT WANT CHINA

2.74

SINO LAND CO

2.60

ALUMINUM CORP-H

1.34

WHARF HLDG

1.12

BOC HONG KONG HO

1.09

CHINA SHENHUA-H

-0.74

CHINA OVERSEAS

-0.75

COSCO PAC LTD

-0.90

TINGYI HLDG CO

-1.71

HENGAN INTL

-2.13

Source: Bloomberg

Urban planning out and about

Controversial new powers for MP, police

A 45-day consultation on Macau’s urban planning law starts today, with the government pledging to have the draft ready this year. The creation of an ‘Urban Planning Council’ and the drafting of legally binding master plan and detail plans are some of the characteristics of the system proposed.

The revision of the Penal Procedure Code, now making its way to the Legislative Assembly, would allow the Public Prosecutors’ Office and the criminal police to apply all restrictive measures, except for pre-trial detention.

This possibility worries local lawyers that say it could contradict the Basic Law. Page 9

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business daily April 25, 2012

MACAU

An urban planning bill meant to tackle problems in urban development should reach the Legislative Assembly by the end of the year, Lau Si Io says

New body may oversee urban planning system Consultation on Macau’s urban planning bill starts today, with the authorities pledging to encourage public participation Vítor Quintã

vitorquinta@macaubusinessdaily.com

M

acau would have an advisory urban planning council if the government’s urban planning bill, first announced four years ago, is passed.

The government released yesterday a consultation document on the bill, and is giving the public 45 days to comment on it, starting today.

The advisory urban planning council would have a voice on where to put important public facilities and the impact of development projects, apart from its role in reviewing urban plans and changes to them.

Wong Chan Tong, the head of the office of the secretary for Transport and Public Works, said the body would have between 20 and 40 members.

More than half the council’s members would be experts, academics and leading figures in the fields of architecture, culture, the environment, transport, infrastructure and engineering, Mr Wong said.

The remaining members would be representatives of the government.

All members would have a two-year mandate, renewable only once.

They would be required to stay out of any discussion about projects in which they were an interested party.

Lao Iong, head of the Land, Public Works and Transport Bureau’s urban planning department, said this was meant to prevent conflicts of interest.

The council would have the power to set up specialist working groups and engage consultants from abroad to offer advice, namely on cultural heritage protection and hydrography.

Experts on urban planning have suggested that the urban planning council be given decision-making powers.

“According to the development of the council’s work and performance, perhaps in the future the conditions will be more appropriate for that to happen,” Mr Wong said.

He said the urban planning system was still in its initial stage and Macau

lacked professionals experienced in this field.

All urban planning proposals would have to be coordinated by planners with at least five years of professional experience, the consultation document says.

UNESCO watching Public consultation will end on June 8, and only two sessions will be open to the public, on May 5 and 19.

Mr Wong acknowledged that this may not be enough but said that the authorities were open to holding other sessions with professionals, associations and advisory bodies such as the Environment Consultative Council.

He said the goal was to send the urban planning bill to the Legislative Assembly this year.

Complementary regulations would be sent to the Executive Council “in due time”, he added.

Macau is due to report to the United Nations Educational, Scientific and Cultural Organisation (UNESCO)

by February 2013.

The government must enact by then a heritage protection law and have an urban planning system in place.

Mr Wong played down any consequences of Macau failing to

have an urban planning system before next February.

Land use study “I think the most important thing is for UNESCO to see that we are doing our utmost to improve the protection of our heritage sites,” he told Business Daily on the sidelines of a press conference.

But he stressed that the law would be only an initial step, setting “the rules of the game” for urban planning.

The secretary for transport and public works, Lau Si Io, said the aim was “to gradually and progressively build an institutionalised urban planning system” to solve “existing problems in the urban planning system”.

A report released by the Guangdong Provincial Urban and Rural Planning Research Institute two years ago warned of the “the lack of a long-term vision and a macro master plan” for the city and “a lack of legal support” for urban planning.

Meanwhile, a study on how to classify land use in the city is underway.

“We have already received a preliminary report,” Mr Wong said.

“We hope to have the study ready by the time the law is approved.”

The next step would be to prepare the master plan and then detailed

Key Points • New council could have decision-making powers in the future • Public consultation would be mandatory for urban plans and revisions • Compensation would be payable to people harmed by urban plans • The government would be allowed to stop construction work and take over private land • A study on land use is underway • Only two public sessions will be held during the 45-day consultation period

plans for different areas.

These plans would be legally binding, unlike the street alignment map, which determines construction areas, heights and storey limits, access and other things.

Before the urban plans were drawn up, the authorities would have to elicit comment from the people, including the owners of property in the vicinity.

Later, the government would have to announce 60 days of public consultation, before the chief executive could approve urban plans or any changes to them.

The master plan would have to be revised every five years, and, if any changes are introduced, the detail plans would also have to be tweaked.

However, changes could be introduced earlier “in exceptional circumstances” such as natural catastrophes or the need to prevent them.

Balance of rights A person harmed in any way by urban plans would have to right to appeal to the courts or to complain to the Public Prosecutor’s Office or the Commission Against Corruption.

The government would have to compensate owners if “significant restrictions” were put on an area’s scope for development or if a plan would stop construction projects already approved.

But the government would have the power to take “preventive action” and put embargos on construction or demolition work for up to two years.

It would also be empowered to take over private land to build public infrastructure and other public facilities.

“We must reach a balance between the rights of individuals and the public interest,” Mr Wong said.

An inter-departmental commission would be in charge of checking whether the urban plans were being enforced and of drafting a regular public report.

Any person or company that broke the urban planning law would be liable to a fine.

April 25, 2012 business daily | 3

MACAU

Final countdown Steve Wynn ‘hopeful’ of Cotai land permission next week Associate Editor

S

teve Wynn, the founder and chairman of the casino operator Wynn Resorts, told Business Daily yesterday he was “hopeful” that his Cotai land concession would be in place by the time of a previously scheduled meeting with Macau government officials next week. But he said he had no privileged information leading him to that view.

Speaking by phone from Las Vegas, Mr Wynn said: “I’m going to be in Macau myself next week for a number of reasons including a meeting with the government. Hopefully it’ll be in place. But we won’t know that until we read it in the [official] gazette.”

“I’ve long since stopped trying to second guess the government and I think it’s a pointless exercise,” he added.

“I have no idea where that [reports of an imminent land grant] came from. I know it wasn’t us, because that’s a no-no.

“Someone told me it came from someone in the government. Well good, if that’s true,” he said.

Mr Wynn indicated that once the anticipated land and building permissions were granted the Wynn Cotai project would be aiming for an opening in the second half of 2015 or first half of 2016.

“I’ve got three-and-a-half to four years yet to finish,” said Mr Wynn in response to a question about what would be inside the new property.

Mr Wynn added he couldn’t yet go public with Wynn Cotai’s cost.

In company conference calls with analysts last year, a price ranging from US$2 billion (15.9 billion patacas) to US$3 billion was mentioned for a 1,500-room project.

Wynn’s chairman now intends to build a 2,000-room property, although 1,500-rooms were mentioned in Wynn’s 2011 annual report. “It’s been 2,000 rooms for some time,” he said.

That fact and the wait to start construction - in a market where annual consumer price inflation is running at six percent and labour costs are also rising – suggests a price tag at the upper end of the range.

Labour issues “The cost of labour has gone up dramatically and the availability of labour has had a concomitant reduction,” Mr Wynn said.

Business Daily asked for his reaction to the appointment in early April of a new director at Macau’s Labour

Affairs Bureau – the government body responsible for helping draft and implement labour and employment policies. Some local employers think it’s a sign worker import restrictions may be eased.

“I don’t take anything negative from that, do you?” said Mr Wynn.

“My conversations suggest that the government having achieved

My conversations suggest that the government is still encouraging the development of the resorts community on an orderly basis

Steve Wynn travelling hopefully

extremely high - virtually full employment, is still encouraging the development of the resorts community on an orderly basis.”

Another factor pointing to an upper range cost for Wynn Cotai is that the company can’t build as high as Mr Wynn would like – because of aviation safety rules for Macau International Airport next to his 21-hectare (51-acre) Cotai plot.

So he will have to build out more at ground level. That means more concrete and steel in the ground.

“We asked if we could go to 150 metres a long time ago, and they explained to us it couldn’t and they showed us this drawing,” said Mr Wynn, adding that his hotel tower would be limited by regulation to 120 metres.

“Our building is designed and submitted at 120 metres pursuant to the airport guidelines. Grand Hyatt [at City of Dreams] has 150 metres and we’re right across the street,” he said.

“That’s why I asked Ian [Coughlan, president of Wynn Resorts Macau] to check up on it. But we didn’t want to complicate the issue of the land by getting into a dispute about height. We figured, ‘Don’t argue, just comply with the regulations’.

“And if the opportunity ever comes up to discuss it, if they [the Macau authorities] bring it up, we’d love to have more height, because it makes our [hotel] hallways shorter,” Mr Wynn said.

Non-gaming attractions The Macau government is on record saying it would like the next round of Cotai resorts to offer more non-gaming facilities to diversify the local tourism industry. That means all the companies currently submitting fresh plans for Cotai – Melco Crown Entertainment, MGM China, SJM Holdings and Wynn Resorts – have been asked to go into a lot of detail and on occasions re-submit items in their plans. Mr Wynn gave some colour on the level of detail required.

“We’ve looked at how people who don’t want to go in a casino can come and enjoy the restaurants.

We’ve been very vigorous in following that,” he said.

Wynn’s chairman also gave a clear indication that Wynn Cotai would have strong mass-market attractions as well as things that will appeal to high rollers.

“We’ve gone further than Bellagio [in Las Vegas] with the front water [lake and fountains]. There’s a gondola that goes around the whole thing into the hotel; so it’s a ride around the fountains. You bet your button it’s interesting.”

Galaxy Macau phase two news expected tomorrow

G

alaxy Entertainment Group is expected to make a formal announcement tomorrow about a start date for phase two of its Galaxy Macau casino resort on Cotai.

The casino operator has invited journalists to a press conference in Hong Kong that day without giving further details.

“We expect Galaxy to announce the Galaxy Macau Phase II development on Thursday,” said Grant Govertsen, managing partner of Union Gaming Group, a gaming equity research specialist, yesterday.

Business Daily reported last week Galaxy was doing preparatory work for the project. Vice-chairman Francis Liu said recently phase two will double the current 550,000 square metre capacity of the site,

adding convention space and more shops.

The cost shouldn’t exceed the HK$16.5 billion (US$2.13 billion) price of phase one, which opened in May last year. It’s likely to be funded mainly by cash reserves and operational cash flow the company says.

Yesterday an undisclosed institutional investor sold a HK$1.1 billion (US$141 million) stake in the company. The stock has risen more than 4,000 percent in under four years.

Galaxy shares initially dropped as much as 3.5 percent on the news in Hong Kong trading before recovering to HK$22.30 at the close; a fall of 1.76 percent on the day. At the close Galaxy had a market capitalisation of HK$93.2 billion.

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business daily April 25, 2012

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HOSPITALITY

Cunha foundation to foster research into legal system

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All equally satisfied, some more than others In our last comment in this space, we considered the satisfaction level of our visitors. The comments were based on the results of a survey by the Statistics and Census Service at Macau’s borders. Overall, in every quarter of 2011, satisfaction with lodging facilities showed a small but consistent improvement, compared with the same period the previous year. In particular, the survey showed that those satisfied with the quality of hotels had increased by between one and four percentage points.

If we focus a little bit more on the details, naturally, the picture becomes somewhat more complex.

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stagnation to continue. “[This situation] is likely to worsen in the future,” one lawyer told Business Daily.

The foundation will also back the publication of books on Macau law and sponsor new and up-andcoming artists.

Mr Cunha has acquired the building in Avenida da Praia Grande where his firm, C&C Advogados, has its offices.

The ground floor of the building will be used for conferences, debates and art exhibitions.

Mr Cunha is a close associate of gaming tycoon Stanley Ho Hung Sun. He also serves as Executive Director of SJM Holdings.

Deposit protection limit removed

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he government has decided to remove the 500,000 patacas (US$62,550) limit from latest version of the draft law creating a deposit protection scheme, which is currently being discussed at the Legislative Assembly.

The limit will instead by introduced in a complementary bylaw signed by the Chief Executive and which does not need legislators’ approval, according to a draft sent to legislators on Friday.

The new version comes more than four months after Legislative Assembly legal advisors said the provision could clash with the legal framework that states what should be regulated through a law or a bylaw.

The scheme says that, in case one of the 25 Macaulicenced banks flounders, its clients would receive compensation. It will not include, however, structured deposits or anonymous certificates of deposit.

The protection scheme is to be based on a Deposit Protection Fund that will receive a start-up allocation of 150 million patacas from the government and will be run by an administrative committee and a consultative body under the Monetary Authority of Macau.

After that, Macau-licenced banks will pay an annual contribution of 0.05 percent of the amount of protected deposits held every January.

V.Q.

Photo by Manuel Cardoso

Satisfaction with hotel services, by main country of origin (2011)

Rui Cunha

rominent Macau lawyer Rui Cunha will inaugurate on Saturday a foundation to encourage research into the region’s legal system.

The advocate, who has been working in Macau for nearly 30 years, has spent the last few weeks fleshing out the final details of the foundation.

Macau’s legal system is based on Portugal’s, which is very different from mainland China’s and from the common law system in neighbouring Hong Kong.

Lawyers here think that Macau law has hardly evolved at all since Portugal handed over the city to China in 1999. They expect the

OVERALL

The chart shows the year-on-year changes in the satisfaction level of visitors coming from our main sources of tourists. Overall, the changes do not seem statistically very significant. But the results for specific countries of origin show notable variation over time. Japan is a case in point, displaying by far the biggest of swings. In the fourth quarter, there is a decrease in the level of satisfaction, which would be more noticeable were it not for the nowvery-positive Japanese swing. These figures suggest the results must be read with care.

They may occasionally raise red flags, but seem sensitive to sampling issues. Moreover, in the last year, the number of questionnaires in various quarters varied between 1,100 and 2,190. The sampling method itself may also raise some difficulties, given the multiple points of exit and the varieties of visitors associated with each of them.

Deposits on local banks will be under a protection scheme in the near future, but a cap has been removed

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macau Photos by Manuel Cardoso

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Food prices, downward resistance As we previously noted in this section, the inflation results published by the mainland Chinese authorities suggest that food prices, a big part of the consumer price index, will continue to be subject to upward pressure.

The extreme dependence of Macau on food supplies from across the border and the nature of the import channels make this inevitable. This suggests that what food prices do in the mainland can provide good early warning of food price trends here. Even allowing for the differences in the baskets of goods and services used to calculate the CPI here and on the other side of the border, we can reasonably conclude that changes in food prices in China will anticipate, to a certain degree, those in Macau. A look at the food components of the CPIs on each side of the border seems to support this conjecture.

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Fund pays HK$98m for top-floor triplex Macau Property Opportunities Fund paid HK$11,200 per square foot for a triplex at One Central

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he Macau Property Opportunities Fund has added a 8,236-square-foot triplex, occupying the top three floors of Tower 3 at One Central to its portfolio.

The asking price of HK$92.2 million (US$12 million) increased to HK$98 million after stamp duty was paid, the company said in a statement on Sunday. It paid HK$11,200 per square foot.

The property has a private elevator, five bedrooms, three terraces and a swimming pool.

The highest price paid for an apartment as of March 31 had been HK$7,809 per square foot, according to Centaline Property

Agency quarterly data. It was for a 1,178 square feet unit of Tower 7 at One Central.

Fund chairman David Hinde said in a press release that the triplex was an “exceptional property” that will show capital appreciation, fuelled by the increasing demand for “trophy assets”.

The fund says it will keep the unit as is, and divest of it at an opportune time. The investment was paid for with an equal share of cash and bank financing.

The company announced on Sunday that it had sold nine individual apartments at One Central Residences.

In May last year, the fund divested

10 individual apartments for a combined sales value of HK$165 million (US$21 million). “Nine out of ten of these transactions, worth a combined HK$144.4 million (US$18.5 million), have now successfully completed,” it said in Sunday’s statement.

The nine completed transactions contributed a net profit of about HK$7.5 million to the fund.

Macau Property Opportunities Fund says it continues to hold 13 units in One Central Residences, with a combined gross floor area of 27,000 square feet.

The company also owns Tower 6 of the development, a building with 59 luxury apartments for lease.

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Small firms ignoring staff training: study

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This graph suggests that prices in the mainland affect the economy here not instantaneously but only after a while. It is reasonable to expect that import contracts are subject to an adjustment delay. So what food prices do here appears to follow a broadly similar pattern to what they do in the mainland after an interval of a few months. So we can say that the big rises in the prices of some kinds of food in the mainland in March have yet to be reflected in the CPI here. But the graph also suggests that there is resistance here to downward movements in prices. The food price deflation in the mainland in 2009 never really arrived here.

M

ost owners of small- and medium-enterprises say they do not need to provide staff training, a survey carried out by the Macau Association of Economic Sciences has found.

The survey conducted last June focused on firms with less than 20 workers. The survey concluded that the biggest problems they face are high rents, competition and a lack of well-trained staff.

While the association calls on lifting the government-imposed quota on imported labour, it also wants staff

to be better trained to improve staff retention and meet the business sector’s wider requirements for qualified workers.

The association wants the government to subsidise smaller companies that offer their staff training.

The association’s report, published on Sunday, says most owners of a small business also need training, and should look for opportunities to improve their management skills.

The use of information technology among small businesses was also poor, the report said. It encouraged

the government to help firms upgrade their equipment.

Retailers made up more than twothirds of the companies surveyed while catering services accounted for 9.3 percent. A majority were sole proprietors, 81.3 percent, and 12.1 percent were joint ventures.

Most of the firms surveyed had yearly revenues of less than 400,000 patacas (US$50,000). They paid an average of 23.5 percent of their revenues on rent and more than two-thirds of the survey sample were renting.

C.L.

Weather Beijing 21/8o C Changchun 17/0o C

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MACAU

Role of Macau in EU, Lusophone ties, key Macau can play an increasingly important part in China’s relations with foreign countries, says the vice-minister of commerce Cláudia Aranda

claudia.aranda@macaubusinessdaily.com

T

he Chinese vice-minister of commerce, Chen Jian, stressed yesterday the importance of Macau in strengthening China’s relations with the European Union and Portuguesespeaking countries.

Speaking during the opening ceremony of the Third International Infrastructure Investment and Construction Forum, he said “Macau can play an increasingly important role” in the relations of China with the outside world.

He said the holding of the forum in the city highlighted the role of Macau in the

development of cooperation between China and foreign countries.

In organising the third such event, the government wants to promote the internationalisation and branding of Macau in the conventions and exhibitions industry.

The city wants to demonstrate that it is qualified to hold large international conferences and host various types of domestic and international exhibitions.

“We want to show the world the advantage of Macau as a service platform for business cooperation, deepen the

knowledge of these countries and regions [participating in the forum] about Macau,” said the secretary for economy and finance, Francis Pak Yuen Tam, “thus to promote cooperation and development in this area between Macau, China and other regions of the world and, ultimately, promoting the diversification of the economy of Macau.”

This is the first time Macau has held the International Infrastructure Investment and Construction Forum. The two first forums were held in Beijing.

More than 800 people are taking part in the two-day

event, including government representatives from various countries, national and international players in the infrastructure sector, contractors, investors and financial institutions.

The goal is “to analyse the opportunities in infrastructure development, address the current world economic crisis, and explore new opportunities in bilateral and multilateral cooperation”, Mr Tam said.

He praised the economic performance of Macau, saying steady development continued.

Mr Tam expects Macau

to continue developing its competitive advantages and quickening the growth of sectors such as tourism, conventions, retailing, and hotels and restaurants.

He also hopes the city will continue to take part in regional economic cooperation and promote adequate economic diversification.

The ultimate goal was to transform Macau into a world centre for tourism and leisure and a service platform for economic and trade cooperation between China and the Portuguese-speaking countries, he said.

Macau, China contractors sign deal

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The Third International Infrastructure Investment and Construction Forum is an important opportunity for Macau to prove its skills, Francis Tam says

he Macau Construction Association and China International Contractors Association have signed an agreement to set up an exchange and information-sharing mechanism, also aimed at investment cooperation. Six others deals have also been signed. The infrastructure sector has entered a stage of steady development, after the fast growth in past years, the China International Contractors Association says. The association believes contracts abroad were affected by a number of unfavourable factors last year, such as Europe’s debt crisis, the slower growth rates of emerging economies and political unrest in Middle East and North Africa.

Busy day in political reform’s final push Huge endorsement of the government proposals is received on the final day of consultation on political reform

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bout 100,000 opinions were sent to the authorities by civic associations and members of the electoral committee for the chief executive on the last day of the second round of public consultation on political reform.

The opinions were overwhelmingly in favour of the government proposals for adding two directly elected seats and two indirectly elected seats to the Legislative Assembly and a further 100 members to the electoral committee for the chief executive.

The Federation of Trade Unions told the news media it had received more than 30,000 affirmations of the mainstream proposals.

The Women’s General Association collected about 19,000 opinions, with 87.1 percent supporting the government’s proposals. President Tina Ho Teng Lat said her association agreed that the city’s political development had to be gradual.

Eight associations in all – including the Macau Chamber of Commerce and Macau General Neighbourhood Unions Association – handed in their opinions on Monday, as along with a group of 12 members of the electoral committee for the chief executive,

led by businessman David Chow Kam Fai. The director of the Public Administration and Civil Service Bureau, José Chu, declined to comment on any of the opinions before the end of the consultation period.

He was quoted by TDM News as saying he had collected the opinions through various channels and that they would be respected and comprehensively analysed.

Credibility concerns But the New Macau Association said the signatures collected by various civic associations that support the mainstream proposal were not the true voice of the public.

The association’s vice-president, Scott Chiang, said the consultations conducted by the associations lacked credibility, mainly because the identity of the respondents was hard to confirm.

He criticised the government for ignoring the people’s true wishes and said many problems plagued the government consultation system.

“The government should pay more

attention to the needs of the general public, instead of sending the political development bill to the legislature in a rush,” Mr Chiang said.

“We’ve seen statistics show that an association gathered 700 signatures in half an hour, which means around two seconds for one person. One would need at least 30 seconds just to explain the proposal. You can only gather 700 signatures if people are queuing, just like crossing the Border Gate, and signing their names on the paper without a pause,” said Mr Chiang.

“It’s really a myth,” said legislator Ng Kuok Cheong, also a member of the

association.

Mr Chiang said the general public was not fully aware that political reform was ongoing, so it was impossible to mobilise citizens to oppose the government proposals.

But the government’s “unreliable” political reform would be unlikely to have any negative impact on the people, owing to the economic outlook, Mr Ng said.

“People will blame the government for the political decision only when the economic environment becomes worse,” he said.

C.L., T.C.

April 25, 2012 business daily | 9

MACAU

Legislators to debate bill on special police powers Amendments to the Penal Procedure Code would allow the Public Prosecutor’s Office and police to impose restrictive measures on suspects Tony Lai

tony.lai@macaubusinessdaily.com

S

even months after public consultations began, the Executive Council has finished reviewing a bill revising the Penal Procedure Code, which will now be submitted to the Legislative Assembly.

The bill, if enacted, would allow the Public Prosecutor’s Office and the criminal police to impose on suspects restrictive measures short of pre-trial detention – a power now wielded only by the courts.

The deputy director of the Law Reform and International Law Bureau, Chan Chi Hin, said the authorities believed the police needed to be able to use such measures.

20 days from 10, restrict searches of residences to between 6am and 9pm and make prosecutions of non-resident suspects urgent.

Mr Leong said the maximum term of imprisonment a singlejudge court would be able to impose would remain three years, “after listening to opinions from different parties”.

It was recommended during the consultations held in 2011 that single-judge courts be allowed to send a convict to prison for a maximum of five years.

Restrictive measures

The Executive Council also finished reviewing a draft bill that would put the Civil Aviation Authority in charge of the investigation of any aviation-related accidents or incidents in the airspace controlled

by Macau.

It would also allow the authority to investigate accidents involving Macau civil aircraft outside Macau’s airspace, when the local aviation authority failed to assume responsibility.

The sole objective of an investigation would be to prevent another accident or incident, and not to attribute blame, Mr Leong said.

The council also discussed a revision of fringe benefits for public security forces.

It is proposed that the Judiciary Police should have new allowances covering meals for negotiators and special vehicle drivers.

It is also proposed to increase allowances for divers and special operations groups.

The government expects to spend an additional 40 million patacas (US$5 million) per year on such allowances.

Last September, when the consultation document was released, lawyer and legislator Leonel Alves said this could “contradict the principle of immutability of the legal system for 50 years, as stated in the MSAR Basic Law”.

Nuno Simões had a similar opinion: “It would allow the indicting authority to also apply restrictive measures.”

The lawyer believes the threat of restrictive measures could be used to “blackmail suspects into confession without the supervision of any outside entity”.

A special trial procedure, called the simplified procedure, would be instituted, and changes would be made to the summary procedure and fast-track trials to speed up the administration of justice.

“These trials will be handled faster than the normal trials,” Executive Council spokesman Leong Heng Teng said yesterday, “but these will not let the rights of the suspects be affected.”

In the air

Proposals to change the law to speed up trials are to be sent to the Legislative Assembly

The summary procedure, if amended, could be used for suspects caught in the act, and not only by the police.

At present a case must go through the normal trial procedure if the authorities fail to provide enough evidence to initiate prosecution within 48 hours.

Speed up trials The simplified procedure would be an alternative to the summary procedure.

It could be used for cases of crimes punishable by imprisonment for a maximum of three years, based on documentary or eyewitness evidence.

Mr Chan of the Law Reform and International Law Bureau said the bill proposed reasonable ways to use resources to speed up trials.

The bill would allow fast-track trials of cases of crimes punishable by imprisonment for a maximum of three years instead of two.

The bill would extend the period in which an appeal could be lodged to

Medical malpractice bill needs further surgery A decade after the authorities first spoke of a medical malpractice law, the bill still has far to go before it reaches the Legislative Assembly Kelsey Wilhelm

kelsey.wilhelm@macaubusinessdaily.com

A

medical malpractice bill will need at least six more months of work before it is ready, the chairman of the Legislative Assembly’s third standing committee, Cheang Chi Keong, said yesterday.

The committee and government representatives, including the head of the Health Bureau, Lei Chin Ion, met yesterday to review a study on the proposals for a bill.

In the meeting the legislators compared the proposals with the present medical malpractice arrangements here and in neighbouring jurisdictions.

But Mr Cheang said the meeting had made little progress beyond what had been achieved by a similar meeting last May, and that no bill had been drafted.

“It has taken so long because you have to take into account lots of issues,” he said.

He compared the medical malpractice bill to the 2009 labour act, which required 57 meetings of the committee before it finished its report.

He described the medical malpractice bill as “new and more complex”.

Once enacted, it is meant to protect patients from harm, to protect the health service providers and to preclude medical inaction due to fear of committing errors.

The authorities are keen on separating non-negligent from negligent malpractice, on supervising the professional qualifications and certification of doctors, on creating arbitration

options and on dealing with insurance questions.

The committee expects that it will take up to three months for a bill to be ready.

“This can’t be done from one day to the next,” said Mr Cheang.

But he added: “Our responsibility is to finish this job as soon as possible.”

He said that only a combined effort by the committee and the government could create a comprehensive medical malpractice bill.

The government created the Macau Health Reform Advisory Committee in 2002 and began consultations on a medical malpractice bill, medical insurance and a health professional council.

A total of 22 cases alleging medical

malpractice were brought against the Health Bureau between 1999 and last September.

Of these, 10 cases have yet to be settled, 11 went to court and one was settled out of court. In three cases the courts found the Health Bureau responsible for malpractice.

A watchdog body set up in 2002 had received 524 complaints about public and private health services by last September.

10 |

business daily April 25, 2012

GREATER CHINA

InBrief Former-MTR chief named HKEx chairman‎

HK trade deficit widens in March

Hong Kong’s merchandise trade deficit increased in March from a year earlier, data released by the Census and Statistics Department showed yesterday. The trade deficit increased to HK$43.875 billion in March from HK$40.083 billion in the same month last year. A government spokesman said merchandise exports relapsed to a noticeable year-on-year decline in March, mainly on a marked deceleration in exports to major Asian markets and amid a continued lull in the U.S. and EU markets.

Hong Kong Exchanges and Clearing to continue to bank on China’s economic development to help fuel its expansion Kana Nishizawa

Cnooc sales rise 3.7 pct Cnooc Ltd., China’s biggest offshore energy explorer, posted a 3.7 percent gain in quarterly revenue as higher crude prices helped counter lower output as the country’s largest field remained shut after oil spills. Sales rose to 48.84 billion yuan (US$7.7 billion) in the three months ended March 31, the Beijing-based company said in a statement yesterday. Cnooc, which gets almost all its income from oil and gas production, doesn’t report first-quarter profit. Output fell 6.3 percent from a year earlier. Cnooc has forecast a 2.7 percent increase in production this year.

Happy day for Taiwan stocks Taiwan stocks ended up 0.24 percent yesterday, reversing earlier losses and outperforming regional peers, as Apple plays such as Hon Hai Precision Industry and Catcher Technology advanced ahead of the California-based company’s second fiscal quarter earnings. The main TAIEX index rose 17.75 points to 7,498.84, after opening down 0.32 percent. Electronics shares were up 0.72 percent. Hon Hai and Catcher gained 3.6 percent and 3.16 percent respectively. HTC Corp climbed 1.16 percent on its second-quarter outlook. The company said it sees a 55 percent jump in revenue in the second quarter from the previous three months.

Forex purchases up in March China’s net foreign exchange purchases in March rose to 124.6 billion yuan (US$19.75 billion) from February’s 25.1 billion yuan, showing rising capital inflows into the country, according to Reuters calculations based on data published by the central bank on yesterday. China suffered rare capital outflows for three straight months in the final quarter of 2011 when choppy global markets spooked investors and led them to pull funds from the world’s second largest economy.

Chow Chung Kong pledged to capture opportunities for Asia’s biggest bourse

C

how Chung Kong, former chief executive officer of subway operator MTR Corp., was named chairman of Hong Kong Exchanges & Clearing Ltd and declared he would capture opportunities for Asia’s biggest bourse.

The 61-year-old, who oversaw the MTR’s merger with another train company and expansion overseas, replaces Ronald Arculli, 73, who stepped down after a maximum consecutive six-years in the job.

Chow has also been CEO of AngloAustralian pallet provider Brambles Ltd. and non-executive director for Standard Chartered Plc. His initial term is for two years.

Hong Kong Exchanges was surpassed as the world’s biggest bourse operator by CME Group Inc. amid global competition from alternative venues and as large initial public offerings from China slow. The city has accounted for 5.5 percent of world IPOs this year compared with 13 percent in 2011 and 18 percent in 2010, according to data compiled by Bloomberg.

“Chow is quite qualified for this new role, having had experience with diverse global and multinational companies,” said Sandy Mehta, chief executive officer at Hong Kong-based Value Investment Principals Ltd. “With MTR he is imminently familiar with local China issues and managing ‘on the ground’ in Hong Kong.

“While he hasn’t operated a financial sector company before, his long association as a board member of Standard Chartered gives him strong credentials and certainly stature and contacts for his new role at the exchange.”

Formal approval Chow, whose appointment requires the formal approval of Hong Kong’s Chief Executive Donald Tsang, said the bourse “will listen carefully to market participants, particularly

those in Hong Kong to capture opportunity for the exchange. ‘‘Hong Kong Exchanges is very much an integral part of the international financial center of Hong Kong,’’ he told reporters after a board meeting in the city yesterday.

But he declined to comment on speculation the bourse may bid for the London Metal Exchange.

“We continue to look for opportunities coming from China’s economic development and policies,” he told reporters. “It’s not the first time we’re talking about international growth, and we’ve seen substantial results in the past two years.”

Chow has good credentials though lacks financial experience, said Steven Leung, Hong Kong-based director of institutional sales at UOB-Kay Hian Ltd, a Singaporean brokerage.

Chow was appointed April 10 as a director of the exchange for two years along with Timothy Freshwater, a former vice chairman for Goldman Sachs Group Inc.’s Asian unit.

Hong Kong Exchanges under Arculli attracted large international listings, including luxury goods makers Prada SpA and L’Occitane International SA. The bourse’s share price more than doubled to HK$128.80 on April 20 from HK$56.55 on April 27, 2006, when Arculli became chairman.

That growth has slowed in recent times. The bourse reported a 1 percent increase in net income in 2011 as initial public offerings declined and trading volume slumped amid Europe’s debt crisis and efforts by China to cool its economy.

At US$17.8 billion, Hong Kong Exchanges’ market value is second in the Bloomberg World Exchanges index behind CME Group, which is valued at US$18.1 billion. The Hang Seng Index closed up 0.26 percent at 20,677.16 Bloomberg

Beijing grants new quota to foreign investors

C

hina granted combined quotas of US$700 million to five overseas investors in the first two weeks of April, allowing them to buy Chinese stocks and bonds under the Qualified Foreign Institutional Investor (QFII) scheme.

The China Administration of Foreign Exchange (SAFE), the country’s foreign exchange regulator, granted the investment quotas to HI Asset Management Co, Ltd, Hospital Authority Provident Fund Scheme (Hong Kong), Cathay Life Insurance Co Ltd, Neuberger Berman Europe Limited and Khazanah Nasional Berhad.

Some institutions saw their quotas lowered as a result of business mergers or other reasons.

China has stepped up QFII approval as part of efforts to further deregulate its capital markets. The China Securities Regulatory Commission (CSRC) said earlier this month the total QFII quota would be raised by US$50 billion to US$80 billion.

China launched the QFII scheme in 2003 to allow foreign investors to buy Chinese stocks and bonds.

China has so far granted QFII licences to 158 foreign investors and 133 of them had obtained combined quotas of US$25.19 billion from the country’s foreign exchange regulator as of April 16.

Reuters

April 25, 2012 business daily | 11

ASIA Indonesian bonds decline on rating

Asian stocks fall on Europe concerns Unsettling news about Europe’s debt crisis weighedon Asian stock markets yesterday Jonathan Burgos

A

sian stocks fell for a fourth Price, the global investment chief for day as political uncertainty fundamental equities at BlackRock in Europe sparked concern Inc., said in a Bloomberg Television the region will struggle to contain interview from Hong Kong. “You its debt crisis and a leading gauge see this resistance to austerity. of China’s economic growth slowed. Europe continues to be central.”

Sony Corp., a consumer electronics Japan’s Nikkei 225 Stock Average company that gets about a fifth of dropped 0.8 percent. South Korea’s sales from Europe, slid 1.7 percent. Kospi Index fell 0.5 percent.

The MSCI Asia Pacific Index fell 0.3 percent to 123.21 as of 5:14 Austerity measures pm in Tokyo. Trading volumes in Japan and Hong Kong were at least Futures on the Standard & 14 percent less than the 30-day Poor’s 500 Index rose 0.4 percent average, while those in Shanghai yesterday. The gauge dropped 0.8 were 45 percent higher. percent in New York on Monday The resignation of Dutch Prime as a revolt against spending cuts Minister Mark Rutte and French in budget-conscious Netherlands President Nicolas Sarkozy’s defeat prompted Prime Minister Rutte to in the first round of his re-election step down. bid sparked concern European Backlash against austerity measures states will struggle to cut spending. in Europe has expanded in recent Kansai Electric said it might have a power shortage of 19.3 percent in July “It’s a time of a greatly unsettled weeks after Spain struggled to meet atmosphere in Europe,” Quintin European Union- imposed deficit

targets and election campaigns in Greece faced anti-austerity rumblings.

“This is destabilising for the markets as a whole,” said Angus Gluskie, managing director at White Funds Management in Sydney who manages more than US$350 million. “Europe is still really the focus.”

Sony slipped 1.7 percent to 1,330 yen. Canon Inc., a Japanese camera maker that depends on Europe for almost a third of its sales, lost 1.1 percent to 3,745 yen.

Stocks linked to China also declined after the Conference Board’s Leading Economic Index for the country rose at a slower pace in March, adding to evidence growth in the world’s second-biggest economy is moderating. The gauge tracks data such as lending activity, consumer expectations and exports

Indonesia’s bonds fell, lifting 10-year yields for a second day, after Standard & Poor’s held off from lowering its debt rating for the nation and fuelpolicy shifts fanned concern inflation will pick up.

S&P refrained from joining Moody’s Investors Service and Fitch Ratings in upgrading Indonesia to investment grade, citing “policy slippages” in a statement on Monday.

The decision wasn’t expected by Bank Indonesia, Perry Warjiyo, director for economic and monetary policy research at the central bank, said. The monetary authority predicts consumer-price gains will reach 4.7 percent this year if sales of subsidised fuel are limited, compared with 3.97 percent in March, Warjiyo said. The rupiah was little changed.

“Investors are now taking a wait-andsee approach on Indonesian assets,” said Artanavaro Gasali, the Jakartabased head of global markets at PT Bank ICBC Indonesia. “The domestic concern is still inflation.”

The yield on the government’s 7 percent bonds due May 2022 climbed one basis point, or 0.01 percentage point, to 5.92 percent, according to closing prices from the Inter Dealer Market Association.

The rupiah traded at 9,195 per dollar as of 4:01 p.m. in Jakarta, after closing at 9,192 on Monday, according to prices from local banks compiled by Bloomberg.

Bloomberg

S.Korea won at four-week low Central bank’s second easing to take place on Friday

BoJ likely to ease monetary policy Central bank may boost asset purchases by up to US$123 billion in its second easing in just over two months Rie Ishiguro and Leika Kihara

T

he Bank of Japan is likely to ease monetary policy on Friday by boosting asset purchases by up to 10 trillion yen (US$123 billion) and in doing so may extend the maturity of government bonds it targets to around three years, according to sources familiar with the central bank’s thinking.

The action, which would be the central bank’s second easing in just over two months, would serve to show the BoJ’s determination to overcome deflation and reach the 1 percent inflation target adopted at its February meeting.

The central bank has been under constant pressure from politicians to do more to rev up the world’s third biggest economy, and BoJ policy-

makers have signalled their readiness to provide more stimulus.

But there is no consensus yet within the central bank on whether it should increase its 30 trillion yen asset-buying programme by the usual 5 trillion yen increment, or by double that amount - as it did in February - for greater market effect. If it were to opt for a bigger increase, the BoJ may also extend the maturity of government bonds it buys under the programme to around three years from the current two-year duration, said the sources who spoke on condition of anonymity.

“What appears to be certain is that the BoJ will ease on Friday. But there seems to be various views on by how much, so that will be a close call,” one of the sources said.

The BoJ now pledges to meet the 30 trillion yen target for asset purchases by the end of this year, but may extend that deadline by about six months if it were to boost the programme, the sources said.

With interest rates virtually at zero, the BoJ has adopted as its main policy tool a programme under which it buys assets ranging from government bonds to corporate debt and trust funds investing in property and shares.

Any expansion in the programme would come mainly in the form of government bonds, although there is a slim chance the BoJ may also pledge to buy more exchange-traded funds (ETFs) depending on the size of increase, the sources said.

Reuters

The South Korean won ended domestic trade yesterday at an about four-week low, but pulled back from early weakness on dollar-selling by exporters and market caution over potential won-supporting intervention by the local authorities.

The won was quoted at 1,140.8 against the dollar at the end of local trade, compared with 1,139.5 at the end of domestic hours Monday. Yesterday’s close was the lowest since 1,141.6 on March 26.

The local currency slipped as far as 1,142.7 in early trade, the weakest intraday level since April 12, Reuters reported. Weak data on euro zone economic activity and the Dutch political turmoil weighed on investor sentiment and undercut risk appetite in the region.

“There’s a steady supply of dollars flowing into the market, including from heavy industry firms,” a foreign bank dealer said. “Market participants see the 1,142 mark as a key resistance level that is limiting gains (by the dollar).” The potential for intervention by the local authorities also kept market participants cautious. Some dealers suspected the Korean foreign exchange authorities had stepped in on April 19 to keep the won above the 1,140 mark.

Local bonds were nearly flat amid renewed risk aversion and a positive lead from U.S. treasuries overnight.

12 |

business daily April 25, 2012

MARKETS Ticker NAME

Hang SENG INDEX Ticker NAME

PRICE

Day %

VOLUME

(H) 52W

(L) 52W

PRICE

Day %

VOLUME

(H) 52W

(L) 52W

73.85

0.2715547

5510861

93.1

53.6

IND & COMM BK-H

5.13

-0.3883495

290551132

6.75

3.46

494

LI & FUNG LTD

16.4

-0.7263923

17296592

20.15

10.82

13

HUTCHISON WHAMPO

1398 1299

AIA GROUP LTD

27.3

-0.7272727

22444805

29.9

19.84

66

MTR CORP

27.05

0

1634011

28.8

22.45

2600

ALUMINUM CORP-H

3.77

1.344086

16087880

7.45

3.2

17

NEW WORLD DEV

9.11

-0.2190581

7599511

12.675

6.13

3988

BANK OF CHINA-H

3.22

0

251389263

4.43

2.2

857

PETROCHINA CO-H

11.22

0.1785714

46644835

11.92

8.59

3328

BANK OF COMMUN-H

5.8

0.5199307

16493101

7.7

4.15

2318

PING AN INSURA-H

62.3

0.6462036

9295969

86.85

37.35

23

BANK EAST ASIA

29.05

0.6932409

770766

34.45

21.85

6

POWER ASSETS HOL

57.15

0

1785098

64.8

52

1880

BELLE INTERNATIO

14.84

-0.2688172

13764734

17.54

11.38

83

SINO LAND CO

13.44

2.59542

5233738

14.16

8.482

2388

BOC HONG KONG HO

293

CATHAY PAC AIR

1 1898

23.1

1.094092

12842817

24.7

14.24

16

SUN HUNG KAI PRO

94.7

0.7446809

5929565

124.4

85.45

13.04

0

4713716

20.15

11.8

19

SWIRE PACIFIC-A

88.4

0.0565931

967193

102.539

69.321

CHEUNG KONG

99.7

0.6562342

2903429

127

79.1

700

TENCENT HOLDINGS

238.8

0.9298394

3418034

241

139.8

CHINA COAL ENE-H

8.59

0

16603906

11.66

6.59

322

TINGYI HLDG CO

20.15

-1.707317

7090412

26

17.84

939

CHINA CONST BA-H

5.95

0.5067568

226368323

7.55

4.41

151

WANT WANT CHINA

9.39

2.73523

15724895

9.48

6.03

2628

CHINA LIFE INS-H

20.75

0.2415459

35537899

29.4

17.04

4

WHARF HLDG

45

1.123596

3498788

59

33.15

144

CHINA MERCHANT

24.8

0.4048583

3324064

37.5

19

941

CHINA MOBILE

85.3

0.5896226

12792299

87.6

68.05

688

CHINA OVERSEAS

15.8

-0.7537688

21950219

17.86

9.99

386

CHINA PETROLEU-H

8.14

0

40396904

9.67

6.22

291

CHINA RES ENTERP

27.5

-0.7220217

2504567

35.5

24

1109

CHINA RES LAND

14.1

-0.5641749

11104640

15.6

7.28

836

CHINA RES POWER

13.76

0.4379562

2439438

16.2

10.82

1088

CHINA SHENHUA-H

33.5

-0.7407407

8859945

40.2

27.1

762

CHINA UNICOM HON

267

CITIC PACIFIC

2 883

13

0.619195

17722686

17.68

12.6

12.6

-0.4739336

4311777

23.85

10.26

CLP HLDGS LTD

66.25

0.2269289

1084826

75.2

62.1

CNOOC LTD

15.96

-0.25

70748501

20.1

11.2 7.52

1199

COSCO PAC LTD

10.98

-0.9025271

7193492

17.16

330

ESPRIT HLDGS

16.02

-0.3731343

3623140

33.95

7.55

101

HANG LUNG PROPER

28.65

0.7029877

5927273

35.3

20.85

104.1

0.1924928

547073

125

84.4

44.8

0.7874016

2192264

54.25

33.2

11

HANG SENG BK

12

HENDERSON LAND D

1044

HENGAN INTL

80.25

-2.134146

1496203

83.45

56.8

3

HONG KG CHINA GS

19.98

0.1002004

8118358

20.65

16.68

388

HONG KONG EXCHNG

127.7

0

4084437

182.5

99.15

5

HSBC HLDGS PLC

68.6

0.5865103

8031205

85.35

56

Shanghai Shenzhen CSI 300 NAME

PRICE

DAY %

VOLUME

2.74

1.107011

91645537

AIR CHINA LTD-A

6.25

0

7971215

ALUMINUM CORP-A

IN FOCUS Vietnam Ho Chi Minh Stock Index (VN): Year-to-date performance 500 460 420 380 340 3-Jan-2012

AGRICULTURAL-A

ANGANG STEEL-A

INDEX 20677.16 52W (H) 24260.76 (L) 16170.35 MOVERS 26 15 7

NAME CHINA SOUTHERN-A CHINA STATE -A

24-Apr-2012 NAME

300

PRICE

DAY %

VOLUME

PRICE

DAY %

4.8

0

44304863

NINGBO PORT CO-A

2.65

0.3787879

VOLUME 30570466

3.31

0.3030303

117998105

PANGANG GROUP -A

7.83

-1.136364

75706439

7

1.010101

23379487

CHINA UNITED-A

4.35

-1.360544

118990942

PETROCHINA CO-A

9.86

0.1015228

16680620

4.37

-1.131222

12946789

CHINA VANKE CO-A

8.63

0.3488372

57089640

PING AN INSURA-A

40.79

0.3937977

42020021 29415988

ANHUI CONCH-A

17.65

-1.065022

44588100

CHINA YANGTZE-A

6.52

0.3076923

18666629

POLY REAL ESTA-A

12.01

0.08333333

BANK OF BEIJIN-A

10.37

3.7

89234210

CITIC SECURITI-A

13.25

0.9908537

178095321

QINGHAI SALT-A

32.84

-3.012404

8281897

BANK OF CHINA-A

3.07

0.3267974

33108624

CSR CORP LTD -A

4.92

0

44783992

SAIC MOTOR-A

15.18

0.4632694

16438965 30948985

4.87

0.8281573

84317998

DAQIN RAILWAY -A

7.48

-0.2666667

46418946

SANY HEAVY INDUS

14.37

-0.691085

BANK OF NINGBO-A

BANK OF COMMUN-A

10.71

6.779661

111497427

DATANG INTL PO-A

5.13

0

9158187

SHANDONG GOLD-MI

32.92

0

4485720

BAOSHAN IRON & S

4.95

-0.2016129

34805159

DONGFANG ELECT-A

21.72

-1.317583

8678742

SHANG PUDONG-A

9.38

1.515152

113165453

8.48

-2.863688

44676377

27.95

3.136531

8278934

BBMG CORPORATI-A BYD CO LTD -A

EVERBRIG SEC -A

13.82

1.468429

36965702

SHANGHAI ELECT-A

GD MIDEA HOLDING

12.94

-3.863299

34318076

SHANXI LU'AN -A

5.57

0.1798561

4888630

27.25

0.5906238

10502794

CHINA CITIC BK-A

4.55

1.789709

73873781

GD POWER DEVEL-A

2.57

-1.153846

69290876

SHANXI XISHAN-A

16.9

1.197605

26525222

CHINA CNR CORP-A

4.49

0.2232143

66478988

GF SECURITIES-A

31.01

-1.524293

14072152

SHENZ DVLP BK-A

16.76

2.070646

47804023 30413176

CHINA COAL ENE-A

9.18

-0.3257329

11944678

GREE ELECTRIC

21.15

-1.856148

14022956

CHINA CONST BA-A

4.77

0.845666

86371135

GUIZHOU PANJIA-A

31.9

1.754386

7126645

CHINA COSCO HO-A

5.43

0.742115

26280969

HAITONG SECURI-A

9.93

-1.488095

155966808

CHINA CSSC HOL-A

36.04

-2.699784

31497290

HANGZHOU HIKVI-A

45.06

3.872752

2555325

CHINA EAST AIR-A

3.95

1.023018

30018124

HEBEI IRON-A

2.99

-2.605863

35332302

CHINA EVERBRIG-A

3.01

2.033898

137569200

HENAN SHUAN-A

64.93

-0.7034715

2871330

CHINA INTL MAR-A

14.4

-1.639344

11591725

HUATAI SECURIT-A

10.52

2.634146

46598956

CHINA LIFE INS-A

7.4

0.135318

SINOVEL WIND-A

SHENZEN OVERSE-A

15.86

-1.856436

2427678

SUNING APPLIAN-A

10.52

0.9596929

62632815

TSINGTAO BREW-A

34.02

0.05882353

3141091

WEICHAI POWER-A

33.18

-2.411765

10949523

WULIANGYE YIBIN

34.37

0

13420047

XCMG CONSTRUCT-A

14.94

-1.451187

12277478

18.48

1.706109

30212721

HUAXIA BANK CO

11.33

2.256318

69450402

XINJIANG GUANG-A

24.33

-1.298174

9740052

12.3

1.652893

95110505

IND & COMM BK-A

4.41

0.4555809

67063704

YANGQUAN COAL -A

19.74

3.02714

27429327

CHINA MERCHANT-A

13.32

-0.2247191

28952908

INDUSTRIAL BAN-A

14.12

1.509705

125912865

CHINA MERCHANT-A

21.83

1.299304

9499534

INNER MONG BAO-A

67.71

-1.898001

32859204

CHINA MERCH BK-A

YANTAI CHANGYU-A

92.22

-2.97738

1621165

YANZHOU COAL-A

23.09

-2.61493

9425121

CHINA MINSHENG-A

6.58

1.54321

210406557

INNER MONG YIL-A

22.19

-0.8489723

19343212

YUNNAN BAIYAO-A

49.51

0

3344536

CHINA NATIONAL-A

6.65

0.1506024

19717363

INNER MONGOLIA-A

5.92

-3.109656

98828719

ZHONGJIN GOLD

22.68

0

16242932

CHINA OILFIELD-A

17.01

-1.276843

11354034

JIANGSU YANGHE-A

157.31

0.07634073

731343

ZIJIN MINING-A

4.27

-0.4662005

70733952

CHINA PACIFIC-A

21.86

1.016636

32604350

JIANGXI COPPER-A

25.15

-0.4354711

9561604

ZOOMLION HEAVY-A

9.93

-0.7

57676646

17.63

1.907514

20625856

CHINA PETROLEU-A

7.29

0.2751032

56362264

JINDUICHENG -A

14.08

0.7874016

15536066

CHINA RAILWAY-A

2.68

0.3745318

51392097

JIZHONG ENERGY-A

19.61

0.5641026

11336090

ZTE CORP-A

CHINA RAILWAY-A

4.4

-0.2267574

34964157

KWEICHOW MOUTA-A

211.52

-0.1510574

2178206

CHINA SHENHUA-A

26.43

0.1136364

20406518

LUZHOU LAOJIAO-A

42.46

1.143402

5432839

CHINA SHIPBUIL-A

6.15

-3.149606

68640346

METALLURGICAL-A

2.64

-1.492537

41303563

CHINA SHIPPING-A

3.1

-3.426791

40161372

NARI TECHNOLOG-A

19.6

-0.9600808

7311472

PRICE

DAY %

VOLUME

PRICE

DAY %

VOLUME

6

-0.990099

11577399

PETROCHINA CO-H

11.22

0.1785714

46644835

CHINA MERCH BK-H

16.08

-0.8631319

10114874

PICC PROPERTY &

9.57

0.5252101

9241983

CHINA MINSHENG-H

7.55

1.478495

34371966

PING AN INSURA-H

62.3

0.6462036

9295969

SHANDONG WEIG-H

NAME

Hang SENG CHINA ENTREPRISE INDEX NAME

CHINA LONGYUAN-H

PRICE

DAY %

VOLUME

AGRICULTURAL-H

3.51

0.2857143

90794074

AIR CHINA LTD-H

5.12

0

0

ALUMINUM CORP-H

3.77

1.344086

16087880

ANHUI CONCH-H

25.6

0.3921569

8292690

BANK OF CHINA-H

3.22

0

251389263

5.8

0.5199307

16493101

20.95

-2.102804

CHINA CITIC BK-H

4.76

CHINA COAL ENE-H

BANK OF COMMUN-H BYD CO LTD-H

10.3

0.3898635

20333271

8.42

1.080432

4174357

11.74

-0.5084746

3689550

SINOPHARM-H

19.88

-1.82716

3790000

CHINA PACIFIC-H

25.65

0.7858546

6752276

TSINGTAO BREW-H

45.35

1.114827

967000

8.14

0

40396904

WEICHAI POWER-H

36.05

-1.232877

5709050

CHINA RAIL CN-H

5.68

-0.6993007

6667531

YANZHOU COAL-H

16.18

-1.939394

19905641

CHINA RAIL GR-H

2.95

-1.006711

15724799

2.96

-1.66113

27709000

5410243

CHINA SHENHUA-H

33.5

-0.7407407

8859945

ZOOMLION HEAVY-H

10.94

-3.35689

19379500

1.061571

33139006

CHINA TELECOM-H

4.11

-0.2427184

23753530

ZTE CORP-H

19.22

-0.8255934

6312998

8.59

0

16603906

DONGFENG MOTOR-H

14.86

2.908587

15303177 10129245

CHINA PETROLEU-H

CHINA COM CONS-H

7.76

0.2583979

15726802

GUANGZHOU AUTO-H

8.15

-1.807229

5.95

0.5067568

226368323

HUANENG POWER-H

4.41

0.6849315

6792500

CHINA COSCO HO-H

4.61

0.6550218

17840846

IND & COMM BK-H

5.13

-0.3883495

290551132

20.75

0.2415459

35537899

JIANGXI COPPER-H

18.28

-0.2183406

6628792

NAME

PRICE DAY %

FTSE TAIWAN 50 INDEX NAME

NAME

CHINA OILFIELD-H

CHINA NATL BDG-H

CHINA CONST BA-H CHINA LIFE INS-H

INDEX 2604.866 52W (H) 3325.45 (L) 2254.567 MOVERS 102 180 18

PRICE DAY %

Volume

INDEX 10817.16 52W (H) 13721.26 (L) 8058.58 MOVERS 19 17 4

PRICE DAY %

Volume

FAR EASTERN NEW

33

-1.197605

5170315

SINOPAC FINANCIA

9.83 -0.7070707

5614630

FAR EASTONE TELE

65.9

3.12989

10908551

SYNNEX TECH INTL

68.5

0

3558611

17.25 -0.5763689

7604616

TAIWAN CEMENT

34.9 -0.5698006

5658552

FIRST FINANCIAL

Volume

ZIJIN MINING-H

NAME

FORMOSA CHEM & F

83.6

-1.065089

5378339

TAIWAN COOPERATI

17.6

0.2849003

4317514

ACER INC

33.2

-3.206997

26890482

FORMOSA PETROCHE

88.2

1.146789

1564276

TAIWAN FERTILIZE

70.7

0.2836879

2375025

ADVANCED SEMICON

28.4

-1.899827

20360155

FORMOSA PLASTIC

81.9

-2.5

21755345

TAIWAN GLASS IND

29.5

-1.172529

2027824

36 -0.2770083

4477422

FOXCONN TECHNOLO

101

2.642276

13934267

TAIWAN MOBILE CO

93

1.528384

8308654

ASIA CEMENT CORP ASUSTEK COMPUTER

276

-1.252236

2484916

FUBON FINANCIAL

30.55 -0.8116883

12527690

TPK HOLDING CO L

380

1.06383

4718547

13.45

-2.536232

43265346

HON HAI PRECISIO

103.5

3.603604

39841625

TSMC

84.6

0.3558719

24904546

CATCHER TECH

196

3.157895

22557680

HOTAI MOTOR CO

182

0.8310249

1452400

UNI-PRESIDENT

42.15

0.3571429

5003420

CATHAY FINANCIAL

30.7 -0.1626016

8813095

HTC CORP

478.5

1.162791

7722401

UNITED MICROELEC

14.75

-1.993355

31425053

16.25 -0.3067485

AU OPTRONICS COR

CHANG HWA BANK

16

-0.621118

7137280

HUA NAN FINANCIA

2444513

WISTRON CORP

42.65

1.306413

5935892

CHENG SHIN RUBBE

70.6

-1.53417

5500199

LARGAN PRECISION

543

4.022989

2716474

YUANTA FINANCIAL

13.95

-1.06383

18850319

YULON MOTOR CO

45.7

-2.350427

15875824

CHIMEI INNOLUX C

12.5

-2.34375

13592138

LITE-ON TECHNOLO

34.8

1.310044

3664347

CHINA DEVELOPMEN

7.51

1.623816

66546125

MEDIATEK INC

258 -0.9596929

7241415

CHINA STEEL CORP

28.85

0.1736111

11809357

MEGA FINANCIAL H

22.3

0

25618136

CHINATRUST FINAN

17.85 -0.8333333

15374428

NAN YA PLASTICS

60.5

0.1655629

3039759

PRESIDENT CHAIN

158.5

0.3164557

706755

CHUNGHWA TELECOM COMPAL ELECTRON DELTA ELECT INC

89.7

1.585504

17246233

33.95

0.443787

9298722

QUANTA COMPUTER

76.3 -0.3916449

6874747

91

1.675978

9124495

SILICONWARE PREC

33.2 -0.7473842

6717768

INDEX 5226.03 52W (H) 6265.48 (L) 4643.05 MOVERS 23 25 2

April 25, 2012 business daily | 13

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

Max 22.65

average 22.29

MeLCo CroWN eNTerTaINMeNT

Min 22.00

22.70

40.0

14.20

22.56

39.9

14.14

22.42

39.8

14.08

22.28

39.7

14.02

22.14

39.6

13.96

22.00

Last 22.30

SaNDS CHINa LTD

Max 31.20

MgM CHINa HoLDINgS

Max 42.25

average 39.75

Min 39.50

Last 39.75

39.5

SJM HoLDINgS LTD

average 30.94

Min 30.80

Last 30.90

23.4

31.1

16.74

23.3

31.0

16.58

23.2

30.9

16.42

23.1

30.8

16.26

23.0

30.7

22.90

16.10 Max 16.82

average 16.62

Min 16.26

Last 16.82

Max 23.30

average 23.16

Min 22.95

Last 23.30

CURRENCY EXCHANGE RATES

-2

0

2

4

6

AUD GBP

ASIA PACIFIC

CHF EUR JPY

MACAU RELATED STOCKS PRICE

13.90

Last 14.10

16.90

MAJORS

NAME

Min 13.92

31.2

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

AUD

1.0294

0.0292

0.8326

1.1081

0.9388

GBP

1.615

0.4041

3.9053

1.6747

1.5235

CHF

0.9126

0.263

2.7942

0.9596

0.7071

EUR

1.317

0.2817

1.6125

1.494

1.2624

JPY

81.18

-0.0739

-5.2599

84.18

75.35

MOP

7.9935

0.0038

0.0763

8.0449

7.9823

HKD

7.7606

0.0064

0.0876

7.8113

7.7529

CNY

6.3079

0.0111

-0.2045

6.5356

6.2846

INR

52.7513

-0.429

0.5947

54.305

43.855

THB

30.97

0.0969

1.8728

31.96

29.63

SGD

1.2473

0.1603

3.9525

1.3199

1.1992

US dollar exchange rates: Major currencies, year-to-date variation (%) -4

average 14.04

WyNN MaCaU LTD

IN FOCUS -6

Max 14.14

DAY % YTD %

(H) 52W

(L) 52W

VOLUME CRNCY

ARISTOCRAT LEISU

3.14

0

42.72727

3.25

1.88

1503631

CROWN LTD

8.96

0.5611672

10.75402

9.2

7.45

1382096

AMAX HOLDINGS LT

0.087

-1.136364

0

0.143

0.06

6610000

BOC HONG KONG HO

23.1

1.094092

25.54348

24.7

14.24

12842817

CENTURY LEGEND

0.26

0

13.04348

0.41

0.204

0

CHEUK NANG HLDGS

3.17

-0.3144654

13.21429

4.79

2.3

0

CHINA OVERSEAS

15.8

-0.7537688

21.72574

17.86

9.99

21950219

CHINESE ESTATES

10.76

-0.1855288

-13.92

14.8

10.2

119000

CHOW TAI FOOK JE

11.58

-0.8561644

-16.81035

15.16

11.52

3880900

EMPEROR ENTERTAI

1.39

1.459854

25.22522

2.09

0.97

511200

FUTURE BRIGHT

0.96

-2.040816

128.5714

1.04

0.3

20833800

CROSSES

AUD HKD

TWD

29.502

0.0169

2.6337

30.716

28.48

PHP

42.732

-0.11

2.5929

44.35

41.879

IDR

9199

-0.1304

-1.4132

9367

8458

AUDJPY

83.571

-0.1113

-6.1493

89.601

72.057

EURCHF

1.20192

-0.0225

1.2372

1.29654

1.00749

EURGBP

0.81553

0.1165

2.19

0.90835

0.81484

EURCNY

8.3113

-0.1829

-2.1308

9.6769

7.9674

EURMOP

10.5301

-0.2877

-1.6913

11.9509

10.1031

EURJPY

106.92

-0.3648

-6.7901

121.84

97.04

1.03

0

0.0097

1.0311

1.0288

HKDMOP

World Stock MarketS - Indices

22.3

-1.762115

56.60113

24.35

8.69

75270702

COUNTRY

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

104.1

0.1924928

12.96799

125

84.4

547073

DOW JONES INDUS. AVG

US

12927.17

-0.7835441

5.808119

13297.11

10404.49

HOPEWELL HLDGS

20.8

0

4.733129

24.903

18.56

677510

NASDAQ COMPOSITE INDEX

US

2970.45

-0.99985

14.02223

3134.17

2298.89

HSBC HLDGS PLC

68.6

0.5865103

16.27119

85.35

56

8031205

HUTCHISON TELE H

3.42

0.2932551

14.38127

3.6

2.13

2110082

4791.01

LUK FOOK HLDGS I

20.8

-1.187648

-23.24723

46.15

19.2

3820738

GALAXY ENTERTAIN HANG SENG BK

NAME

FTSE 100 INDEX

GB

5690.66

0.4428504

2.124451

6103.73

DAX INDEX

GE

6572.95

0.765752

11.4371

7600.410156

4965.8

JN

9468.04

-0.7768673

11.97692

10255.15

8135.79

MELCO INTL DEVEL

7.96

0.5050505

37.95494

10.76

4.3

3338046

NIKKEI 225

MGM CHINA HOLDIN

14.1

0.7142857

46.99514

17.183

7.6

2171000

HANG SENG INDEX

HK

20677.16

0.2558621

12.16623

24260.76953

16170.35

MIDLAND HOLDINGS

3.97

-0.9975062

-1.732672

5.976

2.95

2722899

CSI 300 INDEX

CH

2604.866

-0.04497248

11.04657

3325.459

2254.567

NEPTUNE GROUP

0.11

-0.9009009

-0.9009022

0.157

0.08

90000

NEW WORLD DEV

9.11

-0.2190581

45.52715

12.675

6.13

7599511

TAIWAN TAIEX INDEX

TA

7498.84

0.2372649

6.034431

9099.75

6609.11

SANDS CHINA LTD

30.9

-1.904762

40.77448

33.05

14.9

20148370

SHUN HO RESOURCE

1.2

0

20

1.32

0.82

0

SHUN TAK HOLDING

3.18

-0.9345794

24.26106

4.686

2.241

3272836

SJM HOLDINGS LTD

16.82

2.436054

32.64984

21

10.22

12104763

SMARTONE TELECOM

16.08

-1.228501

19.64286

18.5

9.8

939185

23.3

-0.4273504

19.48718

27.48

14.807

8755200

ASIA ENTERTAINME

5.88

-0.3389831

0

10.8692

4.72

77181

BALLY TECHNOLOGI

46.49

-0.9375666

17.51769

47.6

24.74

701497

BOC HONG KONG HO

3.01

0

25.56381

3.16

1.81

13050

WYNN MACAU LTD

GALAXY ENTERTAIN

2.95

-2.960526

57.75401

3.09

1.08

3800

INTL GAME TECH

16.19

-2.293301

-5.872097

19.15

13.38

2482138

JONES LANG LASAL

78.93

-1.595811

28.84427

107.77

46.01

195923

LAS VEGAS SANDS

56.88

-1.778622

33.11491

62.09

36.08

9637102

MACAU CAPITAL IN

0.11

0

9.999998

0.11

0.11

500

MELCO CROWN-ADR

14.99

-3.786906

55.82121

16.15

7.05

14306555

MGM CHINA HOLDIN

1.78

0

49.36731

2.21314

1.00254

1500

MGM RESORTS INTE

13.12

-2.95858

25.79098

16.05

7.4

14224224

SHUFFLE MASTER

16.89

-0.1182732

44.11262

18.77

7.35

460030

2.09

-5.429864

28.22086

2.64

1.28

3000

125.25

-2.89945

13.35868

165.4931

101.02

1842923

SJM HOLDINGS LTD WYNN RESORTS LTD

KOSPI INDEX

SK

1963.42

-0.4668894

7.541055

2231.47

1644.11

S&P/ASX 200 INDEX

AU

4360.447

0.1841499

7.491229

4930.6

3765.9

JAKARTA COMPOSITE INDEX

USD

ID

4170.353

0.3576473

9.114647

4232.923

3217.951

FTSE Bursa Malaysia KLCI

MA

1582.28

-0.09597171

3.367677

1609.33

1310.53

NZX ALL INDEX

NZ

785.446

0.2492683

7.624784

814.431

700.441 2695.06

PHILIPPINES ALL SHARE IX

PH

3440.75

0.4580942

12.99523

3465.89

HSBC Dragon 300 Index Singapor

SI

572.66

-1.2

15.38

na

na

STOCK EXCH OF THAI INDEX

TH

1196.66

0.6146214

16.71089

1214.31

843.69

HO CHI MINH STOCK INDEX

VN

465.65

0.1031881

32.45627

488.02

332.28

Laos Composite Index

LO

1017.92

-1.638837

13.17012

1348.88

876.33

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

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14 |

business daily April 25, 2012

Opinion

France’s election by default

R

Dominique Moisi

Author of The Geopolitics of Emotion

ousseau versus Hobbes: on the cover of the French magazine Philosophie, the two leading contenders in France’s presidential election, the incumbent Nicolas Sarkozy and the Socialist candidate François Hollande, are dressed up accordingly. “The real presidential contest” according to the magazine, pits the consensual and contractual vision of Rousseau (Hollande) against the violent “every man is a wolf to his fellow man” vision of Hobbes (Sarkozy).

Philospophie’s take on the French presidential election may contain some truth, but reality is far more prosaic – and far less intellectual.

To understand the complexities of the race, sports might be a better reference point than philosophy.

Consider Hollande’s strategy in soccer terms. Having scored early (establishing a lead in public-opinion polls), he has found himself in the position of an Italian coach practicing the “catenaccio” tactics of 20 years ago – a purely defensive strategy to keep Sarkozy from coming back. It might work, but it has also contributed to the tedium of Hollande’s campaign and the growing lack of enthusiasm for his person.

Hollande wanted so much to stress his “normality” compared to the excesses of Sarkozy’s character that he ended up appearing banal. As a result, he has found himself hemmed in by the crypto-revolutionary aura of the far-left candidate, Jean-Luc

the election campaign, the challenges he faces remain formidable, and may be impossible to overcome.

Never in the history of the Fifth Republic has the same partisan majority won a presidential contest more than three times in succession.

Sarkozy’s re-election, following his victory in 2007 and Jacques Chirac’s triumphs in 1995 and 2002, would mean a fourth consecutive victory for the Gaullist right, which would be all the more remarkable in view of the economic situation in France, Europe, and the world.

A suicidal denial of reality seems to unite the candidates and their supporters, best formulated as follows: “Don’t address serious issues during the election campaign, and we will not expect you to confront them seriously when Uninspiring choice you are in power

Melenchon, and Sarkozy’s hyperenergetic dynamism.

Mohammed Merah’s killing spree in Toulouse in March has also worked in favor of Sarkozy, who has been happy to shift the electoral debate from social injustice to security issues.

But, even if Sarkozy looks stronger now than he did at the beginning of

Beyond these structural and historical factors, there is the issue of personalities. In this regard, the contest is not so much between Hobbes and Rousseau as between Bonaparte and Clement Attlee, the famously dull post-war British prime minister (of whom Churchill once said “he has much to be modest about”).

In other words, the election may simply become a contest between rejection of Sarkozy and lack of passion for Hollande. As a result, abstention – usually remarkably low in French presidential elections – may play a major role.

In the meantime, regret can be sensed across the political spectrum. “If only we could have a more presentable candidate than Sarkozy,” mumble conservatives. “If only we could have a more charismatic candidate than

Hollande,” comes the refrain from the Socialist camp.

Ultimately, this campaign will prove remarkable for the lack of serious attention paid to the candidates’ programs. The French perceive no real difference between an incumbent who has not kept his promises and a challenger whose promises are untenable. A suicidal denial of reality seems to unite the candidates and their supporters, best formulated as follows: “Don’t address serious issues, such as the national debt, during the election campaign, and we will not expect you to confront them seriously when you are in power.”

Consider the recent cover of The Economist, which depicts Sarkozy and Hollande as the two male characters in Manet’s famous painting “Déjeuner sur l’Herbe” (Lunch on the Grass). Surrounded by naked women, they are supposed to illustrate the “French art of life” that France can no longer afford.

Where is Churchill and his call to arms, effort, and sacrifice? Is France preparing to waste another five years, regardless of the election’s outcome?

Of course, in strong winds and high seas, the experience of the ship’s captain matters. Yet, given the problems of the French economy and the constraints of the European Union, not to mention those of the world economy in a global age, no president will have much room for maneuver. © Project Syndicate

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April 25, 2012 business daily | 15

OPINION Business

wires Leading reports from Asia’s best business newspapers

Chinese values?

Joschka Fischer

Germany’s foreign minister and vice-chancellor

Taipei Times

Taiwan’s unemployment rate slid last month but salaries failed to reflect the tighter supply of labour as employers remained cautious about the economic outlook.

The jobless rate dropped to 4.17 percent last month from 4.48 percent in March last year, the Directorate-General of Budget, Accounting and Statistics said on Monday. However, data show that, adding in bonuses and other forms of compensation, the average monthly salary fell by 2.1 percent in January and February from a year before to NT$62,863 (MOP17,034).

Jakarta Globe

A company controlled by Hutomo Mandala Putra, the youngest son of the late Indonesian dictator Suharto, is fighting legal claims for a combined US$145 million by some of the world’s best-known shipping families. Companies linked to Norwegian billionaires Arne Wilhelmsen and Arne Blystad, as well as the Polemis family, say they leased ships in 2007 and 2008 to a Singapore-registered offshoot of the Indonesian conglomerate PT Humpuss, which failed to pay the fees.

Times of India

PricewaterhouseCoopers has said that 66 percent of chief executives in India are confident about having access to talent despite widely acknowledged skill gaps, compared with 38 percent in China and 30 percent globally.

The consulting firm said in its 15th annual global survey that India’s economic growth seemed to have done little to reduce the availability of talent. However, 41 percent of the chief executives surveyed in India said that they cancelled or postponed important initiatives because of skill shortages.

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T

here can be little reasonable doubt today that the People’s Republic of China will dominate the world of the twenty-first century. The country’s rapid economic growth, strategic potential, huge internal market, and enormous investment in infrastructure, education, and research and development, as well as its massive military buildup, will see to that. This means that, in political and economic terms, we are entering an East and Southeast Asian century.

Lest we forget, the outcome for the world would have been far worse if China’s ascent had failed. But what will this world look like? We can foresee the power that will shape its geopolitics, but what values will underlie the exercise of that power?

The official policy of “Four Modernizations” (industrial, agricultural, military, and scientific-technological) that has underpinned China’s rise since the late 1970’s have failed to provide an answer to that question, because the “fifth modernization” – the emergence of democracy and the rule of law – is still missing. Indeed, political modernization faces massive opposition from the Chinese Communist Party, which has no interest in surrendering its monopoly of power.

Moreover, the transition to a pluralist system that channels, rather than suppresses, political conflict would indeed be risky, though the risk will grow the longer one-party rule (and the endemic corruption that accompanies it) persists.

Ideologically, Chinese leadership’s rejection of human rights, democracy, and the rule of law is based on the contention that these sup-

The decisive question of political modernization remains unanswered.

China’s course as a world power will be determined to a significant extent by the way it confronts this question

posedly universal values are a mere stalking horse for Western interests, and that repudiating them should thus be viewed as a matter of self-respect. China will never again submit to the West militarily, so it should not submit to the West normatively either.

Asian values?

And here we return to the concept of “Asian values,” originally developed in Singapore and Malaysia. But until this day, three decades later, its meaning remains unclear.

Essentially, the concept has served to justify collectivistauthoritarian rule by aligning it with local tradition and culture, with autonomy defined in terms of otherness – that is, differentiation from the West and its values. Thus, “Asian values” are not uni-

versal norms, but rather a self-preservation strategy harnessed to identity politics.

Given the history of Western colonialism in Asia, the desire to maintain a distinct identity is both legitimate and understandable, as is the belief in many Asian countries – first and foremost China – that the time has come to settle old scores. But the effort to preserve one’s power, the need for a distinct “Asian” identity, and the desire to settle historical scores will not solve the normative question raised

by China’s emergence as the century’s dominant power.

How that question is answered is crucially important, because it will determine the character of a global power, and thus how it deals with other, weaker countries.

A state becomes a world power when its strategic significance and potential give it global reach. And, as a rule, such states then try to safeguard their interests by imposing their predominance (hegemony), which is a recipe for dangerous conflict if based on coercion rather than cooperation.

The world’s acclimation to a global hegemonic structure – in which world powers guarantee an international order – survived the Cold War. The Soviet Union wasn’t ideologically anti-Western, because Communism and Socialism were Western inventions, but it was anti-Western in political terms. And it failed not only for economic reasons, but also because its internal and external behavior was based on compulsion, not consent.

Hard and soft power By contrast, the United States’ economic and po-

litical model, and that of the West, with its individual rights and open society, proved to be its sharpest weapon in the Cold War. The US prevailed not because of its military superiority, but because of its soft power, and because its hegemony was based not on coercion (though there was some of that, too), but largely on consent.

Which path will China choose? While China will not change its ancient and admirable civilization, it owes its re-emergence to its embrace of the contemporary Western model of modernization – the huge achievement of Deng Xiaoping, who put the country on its current path more than three decades ago. But the decisive question of political modernization remains unanswered.

Clearly, national interests, and sometimes pure power, play a part in how the US and other Western countries apply values like human rights, the rule of law, democracy, and pluralism. But these values are not mere ideological window dressing for Western interests; in fact, they are not that to any significant extent. They are indeed universal, and all the more so in an era of comprehensive globalization.

The contribution of Asia – and of China, in particular – to the development of this universal set of values is not yet foreseeable, but it will surely come if the “fifth modernization” leads to China’s political transformation. China’s course as a world power will be determined to a significant extent by the way it confronts this question. © Project Syndicate

16 |

business daily April 25, 2012

CLOSING Facebook buys Microsoft patents

Google driving towards the cloud Google is expected to launch a major new consumer service offering cloud-based storage for photos and other online content. The effort - dubbed Google Drive - is likely to offer 5GB (gigabytes) of free storage with more available for a monthly fee. Reports suggest that it will work with sophisticated image search technology to let consumers sift through a wide variety of document types, including PDF files and photographs. Google is pushing into a market now dominated by the likes of Dropbox and Box. Experts suggest it could also force rival Facebook to enter the cloud market.

Facebook is paying Microsoft Corp US$550 million in cash for hundreds of patents recently sold by AOL, the social networking company’s latest move to bulk up its intellectual property in the wake of a lawsuit filed by Yahoo.

A company lawyer described the deal as: “Another significant step in our ongoing process of building an intellectual property portfolio to protect Facebook’s interests.” The social networking site, which is preparing for a stock market listing, also reported a drop in its first quarter profits to US$205 million from US$233 million a year earlier.

Dutch PM appeals for responsible action President Hu Jintao

A day after the fall of his government, Mark Rutte has urged the opposition to react ‘responsibly’

Tight schedule

Gilbert Kreijger and Thomas Escritt

T

he Dutch prime minister said his country faced a crisis and asked parliament to push through budget cuts after his government lost the support of its main political ally and tendered its resignation.

But the main opposition parties signalled they would not back the 14 to 16 billion euros savings package he must present to the European Union next week to show the Netherlands is on track to meet its stringent budget limit.

The Netherlands has been one of the euro zone’s most stable members but the minority coalition’s split with the populist Freedom Party has created a political vacuum, worrying financial markets and the Moody’s credit rating agency.

A Dutch bond sale went smoothly yesterday, calming financial markets but investors are waiting to see whether he can find new backers for the cuts and agree an election date with other political parties.

run away from them. I’m standing here without pretences, it is up to parliament and the voters.”

Geert Wilders’ Freedom Party had backed the government for the past 18 months but said he was no longer willing to be dictated to by Europe.

“It is the government, not the citizen, not Henk and Ingrid, who spent too much. Either we choose to act in the interests of Henk and Ingrid or we act in the interests of Brussels,” Wilders said.

The Dutch government had been looking to raise between 1.5 billion and 2.5 billion euros - it raised 2 billion euros.

“Standing still is not good for the Netherlands. The problems are serious, the economy is stalling, employment is under pressure and government debt is growing faster than the Netherlands can afford,” Prime Minister Mark Rutte told parliament yesterday.

“Those are the facts and nobody can

The Netherlands has until April 30 to present the European Commission with a 2013 preliminary budget that will cut the country’s projected budget deficit of 4.6 percent of GDP to within the EU’s 3 percent limit.

Mr Rutte, in effect a caretaker prime minister since his resignation on Monday, will now seek an agreement with the Dutch parliament on a date for early elections and on budget cuts of 16 billion euros.

Some politicians are pushing for one as soon as June while others have suggested the earliest possible date is in September.

The crisis has also attracted the attention of credit ratings agency Moody’s which said on Monday the government crisis was a negative factor for the country’s credit but maintained its Aaa rating with a stable outlook.

But it said if the country weakened its commitment to fiscal discipline, the rating could face downward pressure.

“This development is clearly creditnegative for the Dutch sovereign given that it generates both political and policy uncertainty,” Moody’s analysts wrote.

“Having said that, the Netherlands is entering this testing period from a position of relative strength.”

Reuters

Australian shares up on inflation data

A

ustralian shares rose as much as 0.5 percent yesterday as inflation data was more benign than expected, giving the central bank the green light for a rate cut next week and offsetting worries about Europe.

Shares gave up some gains as doubts about the euro-zone’s ability to push through measures to end its debt crisis weighed on sentiment, although the surprisingly low inflation data firmly supported prices.

Australian consumer prices rose by far less than expected last quarter and underlying inflation was the slowest in over a decade, knocking the Australian dollar a third of a cent and bond yields hit 60-year lows.

“We did have a weak overnight lead,

but if you look at what is in positive territory in the market, it’s a collection of industrials that obviously would find some support on those rate cut expectations coming back into the market,” said Peter Esho, Chief Market Analyst City Index.

Esho added that cyclical stocks, such as Stockland Corp up 2.3 percent, were also benefiting from the benign data and the chance of a cut in rates.

“I think they’ll cut, and at the moment we are trying to weigh up if it will be a 50 basis point cut or two 25 basis point cuts, I wouldn’t be surprised if you get one 50 basis point cut,” he added.

The Reserve Bank of Australia (RBA) has already indicated it

The RBA has indicated it will consider cutting the cash rate next week

will consider cutting the 4.25 percent cash rate at the May 1 policy meeting, providing inflation numbers were tame.

There have been increasing calls for a rate cut as Australia’s economy has slowed, hurt by weaker global demand.

“The lower inflation outcome means that the RBA has very little reason to keep interest rates at current settings,” said Richard Grace, chief currency strategist and

head of international economics at Commonwealth Bank of Australia in Sydney. “It’s going to put the Australian dollar under a bit of downward pressure for the next 24 hours or so, perhaps 48 hours.”

The Aussie has weakened against all 16 of its major peers yesterday as investors speculate that the RBA will implement even deeper rate reductions than previously expected.

Reuters/Bloomberg