Year I Number 183 Friday December 14, 2012
Editor-in-chief: Tiago Azevedo
Deputy editor-in-chief: Vitor Quintã
MOP 6.00
Retail sales to Pollution double byrisk2015with
wastewater plant delays D
elays – confirmed by the government yesterday – in modernising Macau peninsula’s controversial wastewater plant could result in “untreated wastewater and sea pollution”. The management – a consortium led by local company CESL Asia Investments & Services Ltd – wants to go ahead with equipment upgrades to the Areia Preta site as quickly as possible. But the five-year oversight deal has been frozen “due to ongoing judicial procedures,” confirmed an e-mailed statement from the Environmental Protection Bureau
yesterday. That’s understood to be a reference to legal challenges by companies questioning their exclusion on technical grounds from the original tender process in 2010. “Part of the equipment is currently in a state of wear and deterioration due to having passed its usual normal length of usage,” added the bureau. In an interview with Business Daily in April, António Trindade, chief executive officer of CESL Asia, warned that a failure to modernise the 17-year-old plant would lead to “untreated wastewater and sea pollution”. More on page 2
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‘Give us budget review rights’: legislators
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‘Training during work hours’ – demand by casino union Casino workers should be entitled to professional training – during working hours – says the Macau Gaming Industry Workers Association. It would help local people move out of the casino pit and into higher management – a policy aim of the government, says the body, a member of the Federation of Trade Unions. It held a forum this week to discuss casino workers’ welfare and education. Taking part were legislators and officials from the Labour Affairs Bureau and Social Affairs Bureau. Casino floor workers – mainly dealers, supervisors and managers – have an average eight-hour shift, says the association. But shift distribution – in some casinos covering ten different time schedules – is not always well managed, association vice-director Leong Sun Iok told Business Daily. Page 8
Any Taiwan casinos under Beijing’s thumb – scholar Page 6
%Day
SANDS CHINA LTD
3.13
COSCO PAC LTD
1.41
CATHAY PAC AIR
1.33
WANT WANT CHINA
1.10
HONG KONG EXCHNG
0.92
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CITIC PACIFIC
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CHINA RES LAND
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BELLE INTERNATIO
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Xi Jinping meets Hengqin authorities Page 7
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business daily December 14, 2012
macau
Wastewater row hits plant performance Two years after modernisation was set to start, plant showing its age Vítor Quintã
vitorquinta@macaubusinessdaily.com
T
he legal dispute over Macau peninsula wastewater treatment plant is already affecting the 17-year-old i n fr as t r uct ur e’s pe rformanc e, authorities admitted. T he Ar eia Preta p lan t “has gradually reached the treatment volume initially foreseen by the design project,” the Environmental Protection Bureau said in an e-mailed reply to Business Daily. “Part of the equipment is currently in a state of wear and deterioration due to having passed its usual normal length of usage,” the bureau added. The plant was to be modernised as part of a new 604.9-million-pataca (US$75.8 million) contract, which was supposed to have be signed in October 2010. But the five-year deal has been frozen “due to ongoing judicial procedures,” the reply confirms, involving two bidders who were excluded – wrongfully, the courts say – from the 2010 tender. Last week Chief Executive Fernando Chui Sai On authorised a deal worth 11.3 million patacas for the supply of three air blowers – which feed air to the tanks where bacteria break up waste – for the plant.
The Macau peninsula wastewater treatment plant opened in 1995
This contract went to a consortium led by local company CESL Asia Investments & Services Ltd, which also won the controversial tender for the plant’s operation. The CESL Asia consortium has been operating the plant since October 2011, even though the
concession has yet to be signed. In an interview to Business Daily in April, António Trindade, chief executive officer of CESL Asia, warned that a failure to modernise the plant would lead to “untreated wastewater and sea pollution”. But the bureau confirmed that the air blower supply contract is independent from the plant’s operation deal. “In order to ensure the normal operation” of the infrastructure, the government “faces the need to proceed with the replacement and renovation of this equipment according to the real needs”. On Wednesday the Infrastructure
Development Office also launched a tender for a new lifting unit for the plant. Bids are open until January 24 and the works will last for a year. Our newspaper knows that authorities are keen to sign the operation contract with the consortium that also includes Portugal’s Indaqua - Indústria e Gestão de Águas SA and mainland China’s Tsinghua Tongfang Co Ltd still this month. The full modernisation of the plant remains on hold but the Environmental Protection Bureau has pledged to “start, as soon as possible, the full development of the modernisation works”.
Macau 16th costlier Asian city for expats Macau is the 16th most expensive city in Asia for expatriate residents, according to a survey by human resource firm ECA International released on Wednesday. ECA carries out a survey twice a year by measuring a basket of common items purchased by expatriates in more than 400 locations globally, such as dairy produce, vegetables, clothing and meals out. The survey does not include housing, utilities and car and school expenses as these items are often compensated for in expatriate packages, ECA said. The ranking did not include Macau “because if we were to include all the locations … it would be very long,” a ECA spokesperson said, quoted by Macau Post Daily. “However, if it were included in the ranking it would be in 83rd
place globally just below Shenyang in mainland China and above Munich. In the Asia ranking, Macau would be 16th,” the spokesperson added. Chinese cities now dominate the list of the most expensive places in Asia due in part to a stronger local currency and Macau comes 8th amongst Greater China cities. ECA regional director Lee Quane said in a statement inflation and the yuan appreciation is making Chinese locations increasingly expensive. “This could be stripping them of the competitive edge they once had over other locations in Asia as companies looking to set up in the region might think twice, now, about posting staff to China,” he said. Beijing is Asia’s fifth most expensive city, followed by Seoul and Shanghai. Singapore and Hong Kong were in the eight and ninth places. V.Q./AFP
December 14, 2012 business daily | 3
MACAU Neto Valente re-elected as top lawyer Jorge Neto Valente will continue as president of the Macau Lawyers Association after his bid – the only one put forward – secured the approval of more than half of the organisation’s members in the elections held on Wednesday, Ponto Final reported. Mr Neto Valente told the Portuguese-language newspaper that the first priority of his new term would be to draft rules allowing for the establishment of law firms. A proposal will soon be sent to the government, he said.
Legislators want to review budgets for major public projects Assembly members also want revision of budget framework law to give them more power over public spending Tony Lai
tony.lai@macaubusinessdaily.com
T
he Legislative Assembly gave its final approval to next year’s budget yesterday, with some legislators praising the estimated surplus of 52.2 billion patacas (US$6.5 billion). But a handful of assembly members want the administration to issue individual budgets for major public projects. A number also asked for debates on the most expensive works, such as the Light Rail Transit system (LRT). Next year’s public revenue is expected to hit 134.8 billion patacas, up by 17 percent from this year, while spending will reach more than 82.6 billion patacas. The administration would spend 18.1 billion patacas on social welfare and 16.3 billion patacas on its economic services says the budget document. About 70 percent of public revenue is expected to come from direct taxes on gaming. Legislator Ng Kuok Cheong said the administration had done a better job in drafting the 2013 budget than previously but added there was still “room for improvement” in letting the assembly oversee the public finances. He said legislators could not have a clear grasp of the spending on some major infrastructures, like the railway system, as the schemes were not set up as individual sections of the budget. For instance, the administration stated it would spend 4.6 billion patacas on the railway next year without providing any further details, said the legislator. “It is just like a sausage but the government only gives out a slice each year for the assembly to review,” Mr Ng stated, adding the legislators did not get a complete picture. The legislator suggests “each important public infrastructure
Projects like LRT should be discussed at assembly beforehand, legislators say
should have its own independent budget”. He added: “It really does not matter whether the LRT budget has ballooned from some 4.2 billion patacas to 10 billion patacas or 20 billion patacas. Only with the entire budget for the project would we be able to judge whether the costs each year are reasonable.” The Commission of Audit, the territory’s watchdog on public administration, released a report in May criticising the ballooning budget of the light rail system, which in that month reached more than 11 billion patacas – almost three-times higher than the initial forecast.
Revising budget law Mr Ng’s fellow legislator and fellow New Macau Association
‘It is just like a sausage but the government only gives out a slice each year for the assembly to review’ Ng Kuok Cheong, legislator
member Au Kam San said all major public-spending projects should be discussed at the assembly beforehand. He singled out the administration’s decision to reserve about 680 million patacas for public bus operators next year and another 190 million patacas for adjusting the service charge paid by the government to the bus companies. “Is it appropriate that next year’s budget has already included spending on raising bus service charges considering the public reaction this year when the government proposed this idea,” he said. A 23-percent hike in the amount the government pays to public bus companies was suspended in July amid public criticism over the quality of services. Legislator Mak Soi Kun suggested the government should set up a procurement law to standardise the methods and the prices at which the public bodies purchase materials. Secretary for Economy and Finance Francis Tam Pak Yuen merely said yesterday the administration would consider every legislator’s ideas while revising the budget framework law next year. Legislators have attacked the law, whose main provisions have been unchanged since 1983, as lagging behind the city’s development. The assembly also approved the execution of last year’s budget. The administration recorded a surplus of 77.4 billion patacas last year with 123 billion patacas in income and 45.6 billion patacas in spending. But the legislators want a more pro-active investment strategy from the Monetary Authority on the fiscal reserve, which had a low return rate last year.
comment
They said boring?
José I. Duarte Economist
T
he former president of the Legislative Assembly has commented in her blog that the recent debate on the policy address was boring. Her view is shared by most of those that, out of professional obligation or curiosity – interest might be too strong a word here – followed, or tried to follow, the protracted discussion. So there seems to be a consensus. The policy address was boring. Certainly, other adjectives might also be applied. But let us stick today to this single problem: the boredom apparently elicited by the policy address among so many. Assuming that nobody contests the importance of the discussions of the government’s policy orientation and the budget, three questions arise. First, why? Second, could it be different? Third, as a corollary of the second question, and assuming the answer to it is positive, what should be done? The answer to the first question should by now be obvious. We have accumulated enough experience over the years and collected enough examples to be able to answer the question with a degree of confidence. And, yes, you guessed correctly, the debate is, as a rule, boring. The process is designed to make it so. The political system implies that most of the members of the assembly share common interests and represent narrow segments of society. Vested interests, group complicities or simply close personal relationships – not to mention privileged access to information and decision-makers – are poor incentives to challenge the government or (most of) its members, most of the time. In the absence of any sturdy institutional checks and balances to constrain the government and, in particular, the powers of the chief executive; with neither outspoken public opinion making itself heard nor public or mass demonstrations of dissatisfaction or frustration making themselves seen; absent any opposition sufficiently structured to be able to formulate alternative policies based on a distinct vision or social narrative, why should the policy address be much (or anything) more than, well, boring.
Yes, they can Could the chief executive focus more on expressing an overall vision of the future and its challenges, and on outlining guiding principles for the government and society? Could the cabinet secretaries be given more leeway to present initiatives in the various sectors and impart, at least, some confidence that they are actually in charge of coherent policies? Could legislators, in general, be more assertive and demanding in their questions, not to mention more creative or relevant? Could officials show greater regard for the legislature and be compelled to make their explanations clear and pertinent? Could public scrutiny be more intense? Could the media be more incisive? There are so many questions. In the abstract, the answer to all is certainly yes. But unless the purpose was to make the event a bit more entertaining and, well, eventful, one would be at pains to imagine why any of these things would be done. Even though some of them verge on being novel, the nature of the event would be unlikely to change. In the big scheme of things, this system was designed to be boring. What inducement is there to make it otherwise? Anyone not yet feeling terribly bored at this point should take the final test. Pick up at random three or four policy addresses from different years and read them. Maybe this will give your perception that the debate in the assembly was boring some perspective. It would take performances worthy of an award to make such a plot entertaining to follow. Above all, the debate should be illuminating. For it to be entertaining would be an enjoyable bonus, a kind of mood-enhancing handout. But a consensus seems to have been reached that it should be neither.
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business daily December 14, 2012
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HOSPITALITY Missing datA A growing population and increased numbers of tourists will inevitably demand more accommodation and restaurants. It is unsurprising that the foundation of companies in the hospitality industry has been a distinctive feature of the past few years. The financial crisis notwithstanding, new ventures have been established consistently. In just two months since the beginning of 2008, October 2009 and February 2010, was not a single new company created. In the four years analysed here, more than seven new companies were established each month, on average. The three months with the highest number of new companies were this year. No doubt their numbers were boosted by the big facilities that opened this year. It is, in any case, a sign of confidence. New companies, share of Hotels and Restaurants %
Okada finds probable partner for Philippines casino resort Manila-listed developer Robinsons Land Corporation reaches ‘basic agreement’ with Japanese billionaire Michael Grimes
michael.grimes@macaubusinessdaily.com
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hares in Japanese entrepreneur Kazuo Okada’s company Universal Entertainment Group rose 6.50 percent in Tokyo trading yesterday after the firm announced a real estate partner for Manila Bay Resorts – a US$2 billion casino resort it is planning in the Philippines. The stock closed at 1,409 yen (US$16.85) a rise of 86 yen on the day. The company currently has a market capitalisation of 112.9 billion yen (US$1.35 billion).
a “provisional licence to own, develop, and manage an integrated mixed-use, resort and gaming development within the project” said the Philippines company in a regulatory filing. “Okada gets a partner who has a strong expertise of the domestic market, while Gokongwei gains entry into a sunrise industry that will complement his businesses,” said Jonathan Ravelas, chief market strategist at Manila-based BDO
then the promissory note is payable in ten years. Wynn Resorts gave Mr Okada’s pursuit of a casino resort in the Philippines as the key reason for wishing to end its association with him. Mr Okada’s side counters that it was more to do with the casino firm’s chairman Steve Wynn keeping control of the company he founded. Mr Okada had been at the time the biggest single shareholder. It’s certainly a matter of public
Universal Entertainment said in a press statement it had reached “a basic agreement” with Robinsons Land Corporation, a Philippine Stock Exchange-listed developer controlled by Filipino-Chinese businessman John Gokongwei. “Robinsons Land will be in charge of the development of commercial facilities and budget hotels and housing facilities for the casino resort project,” Universal said. Neither side provided information on capital costs or the financial structure of the deal. If the agreement comes to fruition, Robinsons will purchase a majority stake in a company that owns 30 hectares of land where Universal Entertainment plans to build Manila Bay Resorts. Under the agreement Robinsons will also take a minority stake in Tiger Resorts, Leisure and Entertainment Inc., the operating company of the project and a wholly owned subsidiary of Universal Entertainment. Tiger Resorts has been awarded
Unibank Inc. What BDO Unibank didn’t mention is that Mr Okada’s tie-up with Mr Gokongwei also gives the Japanese businessman regulatory security. Article 12, Section 2 of the Philippine Constitution prevents – in theory – foreigners from owning more than 40 percent of a business.
record that when in 2000, Las Vegasbased Mirage Resorts – a firm founded by Mr Wynn – merged with MGM Grand Inc. to become MGM Mirage, Mr Wynn lost his controlling role in The Bellagio, a casino project he had conceived and created and that was close to his heart. Mr Okada and Mr Wynn are now embroiled in multiple lawsuits covering multiple issues in the fallout created by Mr Okada’s ousting from Wynn Resorts. Until there’s a final legal ruling on the cancellation of Mr Okada’s stake, it’s difficult to calculate what it means in financial terms. But when inflation, tax, legal fees and the likely appreciation in value that would have occurred if Mr Okada had been allowed to keep his money in Wynn Resorts are taken into account – then Mr Okada will have to make a large amount of money from his Philippines venture to make up for what he could lose from the Wynn battle.
6 5 4 3 2 1 0
2008
2009
2010
2011
2012*
*year to September Number Stock In the context of all newly created companies, the number in the hotel and restaurant businesses is not great. They have made up about 2.6 percent of all enterprises each year since 2008. The proportion may increase slightly this year, as the figure for the first three quarters was about 3.3 percent. Curiously, the proportion of the capital stock of all enterprises that new companies account for has been declining. New companies accounted for more than 5.2 percent of the capital stock in 2008. In 2009 they accounted for less than 0.9 percent – a sign of the financial crisis. The proportion rebounded slightly in 2010, but since then it has been less than 1 percent. This statistic must be interpreted with caution because the data series is broken. Some of the data have been withheld because of questions of confidentiality. Nine out of the 12 instances of missing data occurred last year. J.I.D.
7.4
Average number of new companies set up each month since 2008
Win some Set against what Kazuo Okada might gain from a Philippines casino investment is the US$800 million he ostensibly lost when his near 20 percent stake in Wynn Resorts Ltd – an existing Las Vegas- and Macaubased casino operator he’d backed for a decade – was cancelled by that company in February. At the time Wynn valued the stake at US$2.7 billion. The US$800 million ‘loss’ therefore represents the 30 percent discount that Wynn Resorts imposed when promising to return Mr Okada’s money. And even
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business daily December 14, 2012
macau Eva Air announces Taichung direct flights
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Starting December 25, there will be seven direct flights taking off between the west-central Taiwan city of Taichung and Macau each week, Taiwan airline Eva Airways Corp and its subsidiary Uni Air announced on Wednesday. The opening of direct flights to Macau is part of Eva Air’s route expansion to mainland’s southeastern cities, including Xiamen, Shenzhen, Hangzhou, Ningbo and Nanjing. A flight between Macau and Taichung lasts less than two hours. Taipei-based Mandarin Airlines Ltd was the first carrier to launch this route, in April.
No big spender The government acts as a consumer in two main ways: it pays its civil servants and buys goods and services. How much does this spending contribute to economic activity overall? This analysis excludes government’s role as an investor, building and maintaining infrastructure. The proportion of gross domestic product that government spending accounts for is small and decreasing. From 2008 to last year, real GDP rose by 58 percent while real, adjusted government consumption rose by only about 25 percent. The result was that government consumption as a proportion of GDP fell to 7 percent last year, 2.8 percentage points below its peak in 2009. This year’s data suggest a further fall.
GDP share of government consumption %
Taiwan gaming outlook uncertain, says scholar Opposition among residents and inadequate infrastructure could hamper any casino resort on the Matsu group of islands, an academic says
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Stephanie Lai
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sw.lai@macaubusinessdaily.com
4
2
0
2008
2009
2010
2011
2012*
*year to September Goods&Services Remuneration The two main components of government consumption are increasing at different rates. The amount the government spent on remunerating civil servants rose by 15 percent between 2008 and last year, increasing at a rate far slower than the pace of growth in its spending on goods and services, which was 40 percent. Remuneration makes up about 60 percent of government consumption. The proportion of GDP that government spending on goods and services accounts for is small. It was 3.9 percent last year and promises to be about the same this year. Growth in government consumption accounted for about 2 percentage points of GDP growth in the past two years. Government consumption was an important contributor to economic growth in 2009, not because it increased by much, but because private-sector expenditure declined.
6.2 %
Government consumption as proportion of GDP, 2012Q1-Q3
J.I.D.
The success of Taiwan casinos would depend heavily on the policy of the mainland Chinese authorities, says academic Chang Wu-Ueh
I
nsufficient infrastructure and other resources needed by tourists could limit the success of gaming on Taiwan’s Matsu archipelago in the short run, according to the director of the Institute of Mainland China Studies at Taiwan’s Tamkang University, Chang Wu-Ueh. Matsu residents voted in favour of having a casino on the archipelago in a referendum on July 6. Mr Chang, a consultant to Taiwan’s Ministry of Economic Affairs, said yesterday that travel between Matsu and Taiwan was inconvenient. “Occasional mist makes thing worse. It can ground flights for up to three or four days,” he said on the sidelines of a forum on economic cooperation between mainland China and Taiwan. “Casinos are integrated with tourism resources such as hotels, water and power supply, and food,” he said. “As for the water resources, the expenses would be high, and secondly, the supporting service facilities take a long time to mature.”
The Matsu archipelago is off the coast of the mainland province of Fujian. Former Las Vegas Sands Corp president Bill Weidner announced in July that he and some partners were willing to invest around US$2 billion (16 billion patacas) in a casino on Matsu. But construction of any casino resort must wait for the Taiwan government to enact gaming legislation, which it expects to do in the middle of next year, according to news media in Taiwan.
Mainland influence A Las Vegas company, Caesars Entertainment Corp, is pursuing a licence for a casino on Kinmen, another archipelago just off the mainland, which is also controlled by Taiwan. Residents of archipelagos controlled by Taiwan must approve the establishment of casinos on their islands in referendums. Mr Chang believes the people of
Kinmen will not welcome casinos. “The residents of Kinmen have a conservative character. If there is a referendum to decide on building a casino, I do not think it will pass,” he said. In a public meeting last year, officials of Taiwan’s Ministry of Transportation and Communications encountered huge opposition to any casino from residents of Kinmen. “I do not think the casinos on Taiwan’s offshore islands will better the performance of those in Macau or other emerging projects in Asia,” Mr Chang said. “The client source for Taiwan’s casinos would be mainly China, but that would be heavily subject to the mainland authorities’ policy,” he said. Taiwan’s proposed gaming law would allow gaming only in casino resorts, and allow casinos to take up no more than 5 percent of a resort’s floor area. It would put no set limit on how much of a casino resort a foreign investor could own.
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December 14, 2012 business daily | 7
MACAU
Hengqin to diversify Macau’s industries: Xi Island administration says new party chief laid out clearer development path Tony Lai
tony.lai@macaubusinessdaily.com
T
he new Chinese Communist party boss said in his recent tour of Guangdong province that Hengqin Island would continue serving as a platform for Macau’s economic diversification and a new mode for regional cooperation. Xi Jinping “said the principle task of Hengqin’s development is to play a direct role in promoting diversification in the Macau industries and to maintain the prosperity in Macau and Hong Kong,” according to Niu Jing, director of Hengqin New Area’s Administrative Committee. Last week Mr Xi went on a fourday tour in the Guangdong province after succeeding Hu Jintao as the party’s secretary general last month. He met with the Hengqin authorities on December 8. Mr Niu also told the Hong Kong newspaper Ta Kung Pao that the new chief wants Hengqin to seize all opportunities to explore cooperation among Macau, Hong Kong and Guangdong province. This means Hengqin should follow existing mechanisms in mainland China, but also learn from the experiences from the two special administrative regions, Mr Niu explained. The Hengqin authorities had already explored new mechanisms like the establishment of the mainland’s first integrated anti-corruption office in September, he added. Mr Xi was on the overall satisfied
New Communist Party chief Xi Jinping met with the Hengqin authorities on December 8
with the current development of the island, remarking that “it is a good start with bright prospects”, according to the Hengqin official. He said Mr Xi’s visit lays out “a clearer direction” for the future Hengqin development and trilateral cooperation.
Since 2009, the island has already attracted investments totaling over 130 billion yuan (173.3 billion patacas), with a further 73 projects worth over 160 billion yuan undergoing discussions, said Mr Niu. The official pledged the authorities would continue to make
land plots available to provide more opportunities for Macau and Hong Kong enterprises. The Hengqin administration put out five land plots for auction last month, including a 30,000-metresquare parcel exclusively for Macau companies.
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business daily December 14, 2012
macau Open doors for bone marrow donors People living in Macau will be able to register as bone narrow donors in the city, according to a three-year cooperation deal signed with the Hong Kong Hospital Authority on Wednesday. Donors’ data will join the Hong Kong database, as Macau’s population is too small to launch an independent record, the Health Bureau said. In the last 10 years 74 Macau patients have required bone marrow transplants and 12 found a donor through the Hong Kong database, the bureau revealed.
opinion
A Kai Fong on every corner
Inês Santinhos Gonçalves*
inessgoncalves.pontofinal@gmail.com
Casino staff demand fair shifts and paid training Casino employees are unhappy with unbalanced work schedules that preclude vocational training Stephanie Lai sw.lai@macaubusinessdaily.com
T
he director of the Traffic Affairs Bureau has found a way to achieve the impossible: guaranteeing “the enthusiasm of hired workers”. Let us proclaim it at conferences, summits and international meetings: Macau has found the way to keep staff happy in their workplaces, and perhaps even make them willing to work on their days off. Admittedly, the recipe is far from conventional but, with enough money, it is easy to do. Despite having a wellequipped Public Security Police Force and Traffic Affairs Bureau, the city has opted to pay 3.16 million patacas (US$396,000) to the General Union of Neighbourhood Associations of Macau, better known as the Kai Fong, to hire common citizens to help with traffic safety campaigns next year. According to the bureau, there will be 16 “consultants” (that is what they are calling them) on the payroll, tasked with advising pedestrians and drivers not to infringe road safety regulations. That is over 3 million patacas for 16 people (and, I guess, something for the union). The Kai Fong have been a part of this effort since 2005 but now their role is official. We do not know who the consultants are – their age, training or even if they hold a driving licence. We do not know if they have a job or are retired, how old they are, if they suffer from any sort of handicap or if they just find it hard to get a job. We do not know if they collect any kind of official subsidy. The government chose not to ask for tenders to do the work the consultants will do. But it apparently cannot to do the work with its own human resources, who were trained to do it. The government feels that the Kai Fong “have the necessary experience in these types of services”. It is all so absurd that I do not quite know where to begin. Had the measure been meant to support a specific disenfranchised group, we could have given them the benefit of the doubt. The government would have been giving those without a job something to do. However, in the absence of any indication that this is, indeed, the case, all we can surmise is that the government has found another way to finance well-entrenched associations – ones with enough clout to silence criticism of the bus services and the chaotic road traffic. * Reporter at Portuguese-language newspaper Ponto Final
C
asino workers should have the right to spend some of their time at work on vocational training and to be paid for it, according to the Macau Gaming Industry Workers Association. This would allow workers to better their skills and improve their chances of promotion, the vice-director of the association, Leong Sun Iok, told Business Daily. The association, a member of the Macau Federation of Trade Unions, held on Wednesday a forum on the welfare and education of casino workers which was attended by members of the Legislative Assembly and officials of the Labour Affairs
Bureau and the Social Affairs Bureau. Casino workers – mainly croupiers, supervisors and managers – work eight-hour shifts, on average. But Mr Leong said casinos were not always good at allocating shifts. “Some casinos basically devise over 10 different types of shift work schedules for the workers, based on the flow of visitors and gamblers in the pits,” he said. “And because of that the rest hours are not evenly distributed.” Mr Leong said it was common for casino workers to work a day shift right after a night shift, “which greatly affects their health, and social and family life”.
The shift system impedes casino workers from taking full advantage of vocational training or higher education courses during their time off. This is something that Mr Leong’s trade union has long spoken out against. “So we have been trying to tell the government and the companies that we want to reserve a certain part of the casino employees’ work hours or, say, 12 days of a year for paid vocational training,” he said. The trade union has also suggested that the education authorities consider recognising online training programmes, which are more suitable for shift workers.
Corporate
Miu Miu opens second store in Macau Italian fashion brand Miu Miu has opened its second store in Macau, this time at The Shoppes at Four Seasons on Cotai. Its first store is at Wynn Macau. Italian architect Roberto Baciocchi, according to a press release issued in Milan by the brand, designed the new outlet. The theme of the venue is a vault “where individual products are presented as precious objects,” says the release. The Miu Miu brand is part of the Prada Group and was created in 1993 by Miuccia Prada, the youngest granddaughter of Mario Prada, founder of the parent company. ‘Miu Miu’ was Ms Prada’s childhood nickname. According to Forbes magazine, she took over the Prada Group in 1978. Since then the group has acquired other famous brands including Jil Sander, Helmut Lang and British shoemaker Church & Co. Advocates for the Miu Miu brand have included Chinese actress and singer Zhou Xun.
MGM Macau donates MOP3 mln to Trade Unions The MGM Macau casino resort has donated three million patacas (US$375,000) to the Macau Federation of Trade Unions toward the cost of a new building for the Federation. Senior management from the resort, including Grant R. Bowie, chief executive officer and executive director of MGM China Holdings Limited, and Wendy Yu, vice president of human resources at MGM Macau, presented a cheque for the amount to the Federation’s chairwoman Ho Sut Heng and vice-chairman Lao Ion Fai. “We are pleased to join efforts with the Macau Federation of Trade Unions in contributing to the development of community services for the benefit of the whole of society,” Mr Bowie said at the presentation ceremony. Macau’s overall unemployment rate during August to October was only 1.9 percent according to the city Statistics and Census service, making staff retention and recruitment a key issue for major employers including casino operators.
December 14, 2012 business daily | 9
GREATER CHINA Taiwan may block new China passports Taiwan will discuss whether to deny entry to holders of new Chinese passports with maps showing two of the island’s most famous spots as part of Chinese territory, a top official said yesterday. Wang Yu-chi, chairman of the Mainland Affairs Council which is the top China policy-making body, told parliament that relevant government units will review the matter within a week. Opposition lawmakers have demanded the government bar Chinese visitors who use the new computer-chipped passports bearing a map that covers Sun Moon Lake and Cingshui Cliff, both popular tourist destinations in Taiwan.
Shanghai sells most expensive land this year Developers seen more optimistic in their outlook
S
hanghai sold a downtown commercial plot of land at the highest price this year as a recovery in sales boosted developers’ expectations for a market rebound even as the government maintained property curbs. The 107,500-square-metre (1.2 million-square-foot) site near Shanghai South Railway station was sold yesterday for 5.4 billion yuan (US$864 million), according to the local land reserve centre. A group of four companies, led by China Vanke Co., the country’s biggest developer, and Shanghai Greenland Group Co., which is building China’s secondtallest tower, bought the site, said property broker Century 21 China Real Estate. China’s land values started to recover in the second half as developers considered acquiring more land even as the government kept property curbs, including home purchase restrictions and a property tax in Shanghai and Chongqing. Average land prices rose 23 percent in November from a year earlier, according to SouFun Holdings Ltd, the country’s biggest real estate owner, which tracks 300 Chinese cities. “It shows how developers’ cash flows have been improving, otherwise they wouldn’t be capable to bid for the ‘land kings,’” Fu Qi, a Shanghai-
Four companies paid US$864 mln for a downtown commercial plot
based analyst at property data and consulting firm China Real Estate Information Corp., said, referring to a term coined by the local Chinese media to describe record-setting land sales. “They are becoming optimistic for the outlook of the market.” It was the city’s highest sale by value this year, according to Century 21, the country’s second-biggest broker. Moody’s Investors Service last month revised China’s property sector to “stable” from “negative” on expectation sales and access to
It shows how developers’ cash flows have been improving, otherwise they wouldn’t be capable to bid for the ‘land kings’ Fu Qi, China Real Estate Information Corp
funding will continue to improve in 2013. China’s housing sales climbed 18.3 percent to 595.8 billion yuan in November from a month earlier, National Bureau of Statistics data showed. China Vanke sold properties for a total 127.2 billion yuan in the first 11 months, higher than the fullyear sales last year. A gauge tracking property companies on the Shanghai Composite Index added 0.2 percent, the best performer among the five industry groups on the benchmark. Bloomberg News
BNP Paribas boosts Bet with Bank of Nanjing Stake increase may cost about US$200 mln
B
NP Paribas SA, France’s largest lender, plans to bolster its stake in Bank of Nanjing Co. to as much as 20 percent as Chinese lenders’ profits defy the global economic slowdown and rise to a record. BNP Paribas will buy the shares in the secondary market to increase its holding from about 15 percent to closer to the maximum allowed under Chinese law, China chief executive Clarence T’ao said in an interview on Wednesday in Shanghai. A 5 percent stake would cost about US$200 million at Bank of Nanjing’s share price yesterday. Investing in local lenders in China has reaped bigger profits for foreign banks including Goldman Sachs Group Inc. than running their own franchises in the world’s second-largest banking market. The Western firms’ gains on the stakes are set to exceed their investments with more than US$20 billion in holdings remaining even after they recouped about US$24 billion over the last three years, data compiled by Bloomberg show. “We’ve always adopted a more strategic approach to our investments
in Bank of Nanjing,” T’ao, 51, said. “It’s not surprising that you see the bank actually trying to get back to a higher level.” BNP Paribas bought 19.2 percent of the Chinese lender in 2005, two years before the bank’s initial public offering diluted that stake to about 12.7 percent. The Paris-based lender purchased an additional 2 percent
US$ 85.6 million
BNP Paribas’ profit in China last year
BNP Paribas expects profit from its Chinese unit to decline this year
stake from October 10 through December 6, Bank of Nanjing, based in the eastern city for which it’s named, said this month. Global banks and financial institutions including Singapore’s Temasek Holdings Pte invested a combined US$33 billion in Chinese banks from 2001 to 2009, according to data compiled by the nation’s banking regulator. For BNP Paribas, profit this year from its Chinese unit is set to decline as the country’s economic growth moderates and the European debt crisis curbs demand for trade finance, Mr T’ao said. The French bank earned a record US$85.6 million in the country last year, an increase of almost fourfold from 2010, according to its annual report for China. “We will not be able to achieve the record results that we achieved in 2011,” he stated. While the lender’s operations were profitable in 2012, T’ao said he’s “more optimistic” for next year as the country’s new leadership takes over and the economy rebounds. Bloomberg News
10 |
business daily December 14, 2012
Greater China analysis
Commodity imports more important than sluggish exports
Chinese aircraft lessors spread their wings Mainland aviation industry cashing in on domestic consumption Alison Leung and Umesh Desai
T
Clyde Russell Reuters market analyst
I
f anybody is worried by the seeming weakness of China’s November trade data, then the commodity numbers should help reinforce the view that the recovery in the world’s number two economy is on track. Exports rose a disappointing 2.9 percent in November, well down on October’s 11.6 percent gain, while imports were flat versus October’s 2.4 percent rise. For exports, there was probably a tailing off because Christmas orders were likely shipped in the prior two months, and the ongoing drag from recession in Europe and sluggish recovery in the United States also would have been a factor. But exports are becoming relatively less important for the Chinese economy, with the policy emphasis on switching to domestic demand as the main driver of growth. This can be seen by the higher-thanforecast 10.1 percent gain in industrial output in November and the 14.6 percent rise in retail sales, which also beat expectations. On imports, especially on the commodity front, it appears lower prices may well have impacted the value figure, as the volume numbers show healthy demand across major items, such as crude oil, copper and iron ore. Oil imports were the joint thirdhighest on record in barrels per day (bpd) terms, coming in at about 5.69 million bpd, about 110,000 bpd more than in October. Oil demand has been rising as new refinery units come on stream, with two starting in October alone. Another started in late November, meaning there’s a strong likelihood that crude imports will remain robust in December. The new units are also slowly starting to make their impact felt on the net imports of refined products, which slipped to 1.35 million in November from October’s 1.37 million. While there are restrictions on the export of some fuels, the ramping up of refinery capacity should at least mean fewer imports of products, thereby cutting the net import figure even if exports remain relatively stable.
New licences The granting of licences to directly import crude to smaller refineries, known as teapots, should also eat into product imports as much of these are in the form of fuel oil, which the teapots use as a feedstock. Similar to oil, iron ore imports showed strong performance, jumping 17 percent from October to 65.78 million tonnes, the highest since January 2011. While some of the rise was put down to mills restocking as prices of the steel-making ingredient rebound from third quarter lows, the ongoing resilience in iron ore would seem to point to solid industrial demand.
In year-to-date terms, iron ore imports are up 8 percent over the same period in 2011, despite the midyear slowing of growth in the economy, and also still ahead of a consensus forecast 6 percent gain in a Reuters survey last December. Turning to copper, the picture is mixed, as the 13.5 percent jump in imports in November looks impressive at first glance, but in reality it only partially reversed the 18.5 percent drop in October from the prior month. Taking the last two months together, given that October was disrupted by a week-long national holiday, and a picture emerges of virtually flat growth in copper imports. The problem is that inventories remain high, equivalent to three months’ imports at current rates at more than 1 million tonnes. And that’s just stockpiles in bonded warehouses, which don’t include other inventories, meaning the total may be closer to 1.4 million tonnes, representing a substantial overhang. But in some ways it’s little surprise that the weakest of the major commodities would be copper, given its predominance in manufactured goods for exports. It seems reasonable that copper will lag both iron ore, used more for steel for domestic construction and car assembly, and crude oil, used to fuel China’s expanding vehicle fleet. The days of uniform strong gains across the commodity complex in Chinese import data are probably past. What’s become clearer from data since the middle of the year loss of economic momentum is that the pick-up in demand will be lumpy and uneven.
he sale of one of the world’s top aircraft leasing companies to a Chinese consortium is the boldest signal yet that China’s aviation industry will increasingly look to the cash-rich home market for specialist finance to support its expanding fleet. International Lease Finance Corp (ILFC), the aviation arm of U.S. insurer American International Group Inc. (AIG) which confirmed the US$4.8 billion sale on Monday, joins a growing number of homegrown Chinese leasing firms looking to exploit the world’s fastest growing air market. For China, the rise of a powerful air finance industry is a third pillar in its aviation development, alongside parts manufacturing and assembly for foreign planemakers like Airbus SAS and Beijing’s own Comac C919 commercial jetliner project. “It’s a huge investment and (ILFC) are the second biggest leasing company in the world,” said Paul Sheridan, chief Asia consultant for specialist aviation think-tank Ascend. China is seen as one of the most promising markets for aircraft leasing, in which airlines rent aircraft to keep the cost of ownership off their balance sheets. The world’s second-largest economy will need 5,260 new aircraft worth US$670 billion through 2031, according to Boeing Co. About half of these new planes would be owned by leasing firms, adding about US$100 billion to the market size which is expected to rise to US$268 billion in the next two decades.
High demand China is a major purchaser from both Airbus and Boeing, often in batches of 100 or more aircraft to coincide with state visits in the spirit of balancing U.S. and European supplies. But government-coordinated purchases have failed to keep pace with demand, leaving a gap in the market for lessors armed
with speculative orders. “We believe that there are not enough aircraft in order in China at the moment. [Buying ILFC] will help Chinese airlines to get more aircraft,” Ascend’s Mr Sheridan said. Until now, that has been an advantage for ILFC and its main rival GECAS, the air leasing arm of General Electric, as they compete with China’s own domestic lessors. “They are growing but not at the expense of ILFC,” said Henri Courpron, the chief executive of ILFC, which is expected to remain U.S.-based with the same management after the sale. “We have something that they don’t have – an order book,” he said before the deal was announced. Chinese lessors have so far been growing by doing sale and leasebacks with cashconstrained airlines and by purchasing from other leasing companies. ILFC owns or manages around 1,000 jets and has some 230 aircraft on order. China is already a major outlet for its planes – it has around a 35 percent market share there. Meanwhile, China’s domestic leasing industry is growing. ICBC Leasing and CDB Leasing Co Ltd are both owned by well-capitalised banks – Industrial and Commercial Bank of China Ltd and China Development Bank Corp. China Everbright Ltd’s China Aircraft Leasing Co Ltd made its name on the international stage in July at an airshow in Farnborough by committing to buy 36 Airbus’ A320s worth US$3.1 billion. And China has also been spreading its wings abroad. Bank of China bought Singapore Aircraft Leasing Enterprise (SALE) in 2006 and renamed it BOC Aviation. Hong Kong Aviation Capital (HKAC) acquired Allco Aviation in 2009 as a route into the international market, which is estimated to need US$4 trillion of new aircraft over the next 20 years, with about half owned by lessors. Reuters
Next Media discloses buyers of its media assets in Taiwan What’s become clearer from data since the middle of the year loss of economic momentum is that the pick-up in demand will be lumpy and uneven
N
ext Media Ltd, controlled by Hong Kong mogul Jimmy Lai, announced the sale of its Taiwan print and television units to two groups of four buyers for NT$17.5 billion (US$602 million). Next Media will sell its Taiwan print assets to four companies, represented by Want Want Chinatimes Group president Tsai Shao-Chung, William Wong of the Formosa Plastics Group, Chinatrust Charity Foundation chairman Jeffrey Koo Jr. and Lung Yen Life Service Corp. chairman Li Shih-tsung, according to a filing late yesterday to the Hong Kong stock exchange. Mr Lai, known for criticicing China’s government, is exiting most of his Taiwan businesses after battling regulators for licences and distribution rights. The investment by Mr Tsai, son of Want Want China Holdings Ltd chairman Tsai Eng-
meng, may raise regulatory concerns because Mr Lai’s Apple Daily and the Tsais’ China Times will have a combined newspaper market share exceeding 45 percent. People are concerned that “someone with so much market share will affect the diversity of Taiwan’s media landscape,” said Lo Shih-hung, associate professor at Taiwan’s National Chung Cheng University’s Department of Communication. Next Media said yesterday it expects to book a HK$2.28 billion (US$295 million) gain on the disposals, and plans to distribute some of the proceeds as dividends. The shares close 1.26 percent down at HK$1.57 in Hong Kong trading. “Jimmy Lai might have sold his Taiwan print unit to ditch the burden of a business that has been losing money and to boost his company’s share price,” said Mr Lo. Bloomberg News
December 14, 2012 business daily | 11
ASIA GrainCorp rejects higher ADM offer GrainCorp Ltd, the largest grain handler in eastern Australia, rejected Archer-Daniels-Midland Co.’s higher A$2.8 billion (US$3 billion) bid as too low. “The increase in the proposed price has not changed the board’s view that ADM’s proposal materially undervalues GrainCorp,” the Sydneybased company said yesterday in a statement. “GrainCorp’s board will be constructive in any dealings in relation to proposals that have the potential to be in the best interests of shareholders.” ADM raised its bid by 3.8 percent last week as it seeks control of the only major publicly traded grain merchant in Australia.
Philippine c.bank keeps rates on hold The Philippine central bank kept its benchmark interest rate unchanged at a record low yesterday, saying the economy needed less support with strong domestic demand seen extending into next year, but it saw risks from strong capital inflows. Bangko Sentral ng Pilipinas kept the overnight borrowing rate at 3.5 percent. “The Monetary Board’s decision is based on its assessment that current monetary settings remain appropriate, as the cumulative 100-basis-point reduction in policy rates [earlier] in 2012 continues to work its way through the economy,” Governor Amando Tetangco said.
Malaysia clashes with Lynas Four Malaysian ministers issued a second joint statement, insisting Lynas Corp. must export residue from its new rare earths refinery under the terms of its temporary operating licence. Prime Minister Najib Razak’s cabinet discussed the issue on Wednesday after Lynas chief executive Nicholas Curtis said on a conference call a day before that the Australian company isn’t required to export waste from the plant under its temporary permit. The company belatedly began processing last month after a series of court victories against local residents wanting to block the refinery for fear of contamination.
Abe set to face manufacturing gloom as Japan contracts Large manufacturers expected the most pessimistic since the global recession Andrew Joyce and Andy Sharp
W
hen Shinzo Abe was prime minister in 2007, optimism among Japanese manufacturers such as Sony Corp. was near a 16-year high. Now, as polls suggest Mr Abe’s party will retake power in elections on December 16, the Bank of Japan’s Tankan survey will probably show today that large manufacturers are the most pessimistic since the aftermath of the global recession. Sony hasn’t made a net profit in four years. Worsening sentiment may heighten pressure on Mr Abe to deliver on promises for more fiscal and monetary stimulus even as he’s constrained by the world’s largest public debt. Honda Motor Co. and Nissan Motor Co. cut their profit forecasts by a fifth after Japan’s territorial dispute with China dragged down sales, while the government is poised to bail out chipmaker Renesas Electronics Corp.
Poor Tankan numbers would give the BOJ a good excuse to ease monetary policy again next week Masaaki Kanno, JPMorgan Securities Japan Co. “Abe’s intentions are very clear. He wants to weaken the yen, push up stock prices and improve sentiment,” said Masaaki Kanno, chief economist at JPMorgan Securities Japan Co. and a former central bank official. “It remains to be seen whether his policies will work.” Mr Kanno expects the BOJ to add
Shinzo Abe, head of the Liberal Democratic Party
to monetary stimulus at its meeting next week. One of the central bank’s new tools is a planned programme of unlimited lending to banks. Policy makers aim to limit restrictions on where money ultimately flows from that initiative, meaning cash could go to companies including hedge funds, people familiar with the central bank’s discussions said.
Yen weakens The yen fell 0.5 percent to 83.65 per dollar in Tokyo, its lowest since March, after the U.S. Federal Open Market Committee on Wednesday expanded its asset-purchase programme and said rates will stay low as long as unemployment remains above 6.5 percent and inflation is in check. The Nikkei 225 Stock Average closed 1.7 percent higher, heading for its fifth week of gains. While the yen has fallen around 5 percent against the dollar in the past month, it’s still stronger than the 100 yen per dollar that Nissan chief executive Carlos Ghosn said is the currency’s “neutral range”.
The BOJ’s quarterly Tankan index for large manufacturers probably fell to minus 10 in December, from minus 3 in September, according to the median estimate of 25 economists surveyed by Bloomberg News. That would be the lowest since the first quarter of 2010. A negative figure means pessimists outnumber optimists. The economy shrank in the last two quarters, meeting the textbook definition of a recession, as the dispute with China, the country’s biggest export market, caused consumers there to shun Japanese products and contributed to Japan’s worst year for exports since the global recession in 2009. Economists surveyed by Bloomberg News expect another contraction this quarter. “Poor Tankan numbers would give the BOJ a good excuse to ease monetary policy again next week,” said JPMorgan’s Mr Kanno, who forecasts a 10 trillion yen increase in the bank’s asset-purchase programme at the meeting on December 19-20. “The BOJ will also face more pressure from politicians and the market to weaken the yen.” Bloomberg News
Bank of Korea sees ‘moderate’ recovery MUFG to buy 20pct of VietinBank Japan’s Bank of Tokyo-Mitsubishi UFJ plans to buy 20 percent of VietinBank from the Vietnamese government for about 60 billion yen (US$720 million), a source close to the deal said, as Japan’s cash-rich big banks expand into fastgrowing Southeast Asian markets. The deal by the core retail and commercial bank of Mitsubishi UFJ Financial Group Inc. (MUFG) for a stake in Vietnam’s second-largest partly private lender will mean all three of Japan’s megabanks have a stake in Vietnam’s wobbly banking sector.
T
he Bank of Korea held borrowing costs unchanged before next week’s presidential election and after North Korea launched a rocket in defiance of international sanctions yesterday. Governor Kim Choong Soo and his board kept the benchmark sevenday repurchase rate at 2.75 percent after 25 basis-point cuts in July and October, the central bank said in a statement in Seoul. South Korea’s economic data has given mixed signals and a rapid rebound in growth is “unlikely,” Mr Kim told reporters after the bank’s unanimous decision. At the same time, the nation is poised for a “moderate” export-led recovery and inflation
will remain low, the BOK said in a statement, bolstering the view that policy makers will remain on hold. “The economy is still weak but not worsening,” said Yoon Yeo Sam, a fixedincome analyst at Daewoo Securities Co. in Seoul. “The Bank of Korea will likely hold the rate throughout next year, unless there is a clear and strong signal of economic recovery.” The Kospi index of shares gained 0.6 percent after closing a day before at the highest level since October 9. “The Bank of Korea has no reason to cut rates further unless the won continues to appreciate to levels that invite hot money inflows,” said Park Jong Youn, a fixed-income analyst at Woori Investment & Securities in
Seoul. “I expect no change in interest rates until the end of next year.” Much of the outlook for South Korea’s economy depends on the strength of a recovery in China, said Ronald Man, a Hong Kong-based analyst at HSBC Holdings Plc. China’s new yuan loans trailed forecasts last month, while industrial output and retail sales exceeded forecasts. “Rising production and stabilising manufacturing conditions show that Korea remains on track for a gradual recovery,” Mr Man said. “This, however, requires the upward momentum in China to be sustained, as Korea’s growth in 2013 will likely be export led.” Reuters
12 |
business daily December 14, 2012
MARKETS Hang SENG INDEX PRICE
DAY %
VOLUME
PRICE
DAY %
VOLUME
PRICE
DAY %
30.75
2.842809
33920297
CHINA UNICOM HON
12.38
-1.118211
21094394
POWER ASSETS HOL
65.85
-1.348315
7288068
ALUMINUM CORP-H
3.42
-0.8695652
13866230
CITIC PACIFIC
10.66
-2.559415
14309037
SANDS CHINA LTD
34.55
3.134328
15747545
BANK OF CHINA-H
3.35
0.2994012
322438687
BANK OF COMMUN-H
5.72
-0.5217391
43178535
NAME AIA GROUP LTD
NAME
NAME
VOLUME
CLP HLDGS LTD
64.8
-3.571429
44484413
SINO LAND CO
14.02
-0.7082153
5064345
CNOOC LTD
16.8
-0.4739336
38222157
SUN HUNG KAI PRO
116.3
-0.4280822
4373505
29.5
-0.8403361
2120997
COSCO PAC LTD
11.48
1.413428
5542755
SWIRE PACIFIC-A
93.85
-0.4772004
1236719
16.36
-0.6075334
19583352
ESPRIT HLDGS
12.26
-0.487013
7718504
TENCENT HOLDINGS
252.8 -0.07905138
2932722
23.7
-0.6289308
13187148
HANG LUNG PROPER
29.5
-1.337793
6316154
TINGYI HLDG CO
CATHAY PAC AIR
13.32
-1.91458
3662008
HANG SENG BK
117.6
-0.42337
1499725
CHEUNG KONG
HENDERSON LAND D
BANK EAST ASIA BELLE INTERNATIO BOC HONG KONG HO
119.7
1.012658
3446172
CHINA COAL ENE-H
7.96
0.6321113
25717052
CHINA CONST BA-H
6.13
0.1633987
289381729
23.15
-0.856531
28617589
24
0
3024895
CHINA LIFE INS-H CHINA MERCHANT
55
-1.168014
3903672
HENGAN INTL
68.25
-1.158581
5046085
HONG KG CHINA GS
21.25
0.4728132
5977147
131
0.9244992
8268017
HSBC HLDGS PLC
HONG KONG EXCHNG
80.25
0.3752345
14270921
79.65
0.1257071
5753725
5.47
-0.1824818
264767982
LI & FUNG LTD
13.32
0.9090909
27201788
MTR CORP
30.65
-0.8090615
2025787
CHINA MOBILE
89.1
0.621118
15520809
HUTCHISON WHAMPO
CHINA OVERSEAS
23.2
-0.4291845
25714462
IND & COMM BK-H
CHINA PETROLEU-H
8.72
1.160093
103139522
CHINA RES ENTERP
27.5
-0.7220217
3654609
22
0.2277904
3908084
WANT WANT CHINA
10.98
1.104972
16043805
WHARF HLDG
59.85
0.3352892
2706934
MOVERS
19
3 22554
INDEX 22445.58 HIGH
22554.4
LOW
22252.43
20.95
-3.009259
15437464
NEW WORLD DEV
12.14
-0.9787928
12754185
52W (H) 22563.14063
CHINA RES POWER
18.4
2.564103
6056871
PETROCHINA CO-H
10.76
-0.3703704
56563739
(L) 22563.14063
CHINA SHENHUA-H
31.8
-0.3134796
14854136
PING AN INSURA-H
60.85
0.4954583
11507357
CHINA RES LAND
28
22251
11-December
13-December
Hang SENG CHINA ENTErPRISE INDEX NAME
PRICE
DAY %
VOLUME
CHINA PACIFIC-H
26.5
0.1890359
7008000
33499943
CHINA PETROLEU-H
8.74
0.1145475
57810313
ZIJIN MINING-H
-0.5747126
24929270
CHINA RAIL CN-H
8.61
-1.261468
23775780
28.5
0.1757469
9961000
CHINA RAIL GR-H
4.53
-1.735358
14195592
3.42
0
314094393
CHINA SHENHUA-H
32
-0.621118
9330069
CHINA TELECOM-H
PRICE
DAY %
VOLUME
AGRICULTURAL-H
3.71
0.2702703
266464391
AIR CHINA LTD-H
6.18
3.344482
ALUMINUM CORP-H
3.46
ANHUI CONCH-H BANK OF CHINA-H
NAME
5.75
-0.6908463
42716389
4.27
-0.6976744
50625585
19.56
0.204918
3520895
DONGFENG MOTOR-H
12.26
-0.1628664
22935404
CHINA CITIC BK-H
4.38
-0.2277904
53944651
GUANGZHOU AUTO-H
6.79
-1.594203
5903412
CHINA COAL ENE-H
8.12
0
28349795
HUANENG POWER-H
6.9
-1.709402
12295793
CHINA COM CONS-H
7.45
0.6756757
23266234
IND & COMM BK-H
5.47
-0.1824818
264767982
CHINA CONST BA-H
6.23
-0.32
214413229
JIANGXI COPPER-H
20.6
0
7663450
CHINA COSCO HO-H
3.73
-0.7978723
26094106
PETROCHINA CO-H
10.76
-0.3703704
56563739
CHINA LIFE INS-H
23.5
-0.2123142
23096976
PICC PROPERTY &
10
-0.3984064
14995426
CHINA LONGYUAN-H
5.53
2.407407
22508000
PING AN INSURA-H
60.85
0.4954583
11507357
CHINA MERCH BK-H
16.32
-0.729927
14428867
SHANDONG WEIG-H
8.13
5.447471
27899500
BANK OF COMMUN-H BYD CO LTD-H
NAME
PRICE
DAY %
VOLUME
12.26
-0.6482982
21710172
3.13
0.6430868
70588828
ZOOMLION HEAVY-H
10.46
-1.320755
12404840
ZTE CORP-H
12.38
-1.746032
6747661
YANZHOU COAL-H
MOVERS
23
3 11224
INDEX 11142.92 HIGH
11224.05
LOW
10967.86
CHINA MINSHENG-H
8.46
-1.052632
37148390
SINOPHARM-H
25
1.010101
1464000
52W (H) 11916.1
CHINA NATL BDG-H
11.1
-1.420959
32848458
TSINGTAO BREW-H
45.4
2.137233
1726300
(L) 8987.76
16.72
-0.2386635
4035400
WEICHAI POWER-H
33.15
-1.777778
2164442
CHINA OILFIELD-H
14
10967
11-December
13-December
Shanghai Shenzhen CSI 300 PRICE
DAY %
VOLUME
PRICE
DAY %
VOLUME
AGRICULTURAL-A
2.68
0
61081373
CITIC SECURITI-A
10.74
-0.7393715
35770956
SAIC MOTOR-A
AIR CHINA LTD-A
5.03
-0.1984127
9999795
CSR CORP LTD -A
4.9
-0.4065041
21984884
ALUMINUM CORP-A
4.75
-1.452282
10283772
DAQIN RAILWAY -A
6.32
-0.1579779
38719182
ANGANG STEEL-A
3.59
-0.2777778
20347512
DATANG INTL PO-A
3.78
-1.305483
ANHUI CONCH-A
17.92
-0.1114827
19378395
EVERBRIG SEC -A
11.58
NAME
NAME
NAME
PRICE
DAY %
VOLUME
14.88
-0.6675567
15748695
SANY HEAVY INDUS
8.67
-1.70068
20495234
SHANDONG GOLD-MI
35.93
-3.724544
17645797
7625894
SHANG PHARM -A
10.14
-2.68714
12975424
-0.6008584
8640235
SHANG PUDONG-A
8.29
-1.309524
124094525
BANK OF BEIJIN-A
8.14
-0.7317073
31808945
GD POWER DEVEL-A
2.34
0
53398794
SHANGHAI ELECT-A
3.75
-1.574803
3250810
BANK OF CHINA-A
2.83
-0.3521127
36295046
GEMDALE CORP-A
5.87
0.3418803
50109267
SHANXI LU'AN -A
17.74
-0.7829978
10406330
BANK OF COMMUN-A
4.37
-1.576577
77458288
GF SECURITIES-A
12.45
-2.352941
16098052
SHANXI XINGHUA-A
34.61
-2.534497
3025418
23.2
1.576182
11759726
SHANXI XISHAN-A
11.59
-1.193521
7287886
15.25
-3.542062
20943454
SHENZEN OVERSE-A
6.32
0.6369427
25402128
GREE ELECTRIC
BANK OF NINGBO-A
9.28
-1.276596
9374982
BAOSHAN IRON & S
4.71
-0.8421053
16636846
GUANGHUI ENERG-A
6.93
0.2894356
39894355
HAITONG SECURI-A
8.79
-0.7900677
25889252
SUNING APPLIAN-A
5.99
-2.917342
58732690
16.46
1.230012
5026157
HANGZHOU HIKVI-A
28.88
-0.03461405
1993210
TSINGTAO BREW-A
30.86
1.114024
2346662
CHINA CITIC BK-A
3.81
-1.295337
19659528
HEBEI IRON-A
2.47
-1.593625
25221730
WEICHAI POWER-A
23.9
-1.40264
4839895
CHINA CNR CORP-A
4.47
-0.2232143
28527346
HENAN SHUAN-A
54.56
-0.8180331
916640
WUHAN IRON & S-A
2.66
-0.3745318
13404912
BBMG CORPORATI-A BYD CO LTD -A
CHINA COAL ENE-A
7.06
-1.258741
8240459
HONG YUAN SEC-A
15.59
-1.88798
6732045
WULIANGYE YIBIN
24.96
-3.666538
45748393
CHINA CONST BA-A
4.34
-0.913242
24353358
HUATAI SECURIT-A
8.24
-2.021403
10089303
YANGQUAN COAL -A
12.19
-2.166934
6454176
CHINA COSCO HO-A
4.24
-1.851852
9643634
HUAXIA BANK CO
9.12
-1.405405
26667299
YANTAI CHANGYU-A
42.74
-0.7200929
1180020
CHINA CSSC HOL-A
19.19
-2.736949
7445595
IND & COMM BK-A
3.95
-1.25
51763549
YANTAI WANHUA-A
13.88
-0.1438849
4791870
CHINA EAST AIR-A
3.08
-1.282051
12153187
INDUSTRIAL BAN-A
13.93
-1.624294
56706711
YANZHOU COAL-A
16.25
-2.108434
2744833
2.71
-1.094891
72528978
INNER MONG BAO-A
31.89
-2.655678
24594545
YUNNAN BAIYAO-A
61.99
0.210152
2263245
CHINA LIFE INS-A
18.56
-1.013333
4970304
INNER MONG YIL-A
20.3
0
10897912
ZHONGJIN GOLD
15.49
-3.005636
24587372
CHINA MERCH BK-A
10.87
-1.628959
55584051
INNER MONGOLIA-A
4.79
-2.839757
39698421
ZIJIN MINING-A
3.65
-1.88172
43702862
9771321
JIANGSU HENGRU-A
28.34
0.6749556
2397291
ZOOMLION HEAVY-A
8.46
-1.627907
29110713
JIANGSU YANGHE-A
91.04
0.5966851
4787371
ZTE CORP-A
8.19
-0.7272727
13134397
JIANGXI COPPER-A
21.09
-1.448598
5793286
ZTE CORP-A
8.38
2.444988
17657199
JINDUICHENG -A
10.72
-1.831502
3104310 7881538
CHINA EVERBRIG-A
CHINA MERCHANT-A
8.9
-1.874311
CHINA MERCHANT-A
25.44
2.374245
10325053
CHINA MINSHENG-A
6.89
-1.71184
222424628
CHINA NATIONAL-A
7.51
-1.572739
31530897
16.14
-0.6157635
2122390
KANGMEI PHARMA-A
15
0.2673797
205.7
-2.90758
6199646
-1.99688
7870943
CHINA OILFIELD-A
18.82
-0.4232804
14445836
KWEICHOW MOUTA-A
CHINA PETROLEU-A
6.28
-0.7898894
22344868
LUZHOU LAOJIAO-A
31.41
CHINA RAILWAY-A
5.65
-1.567944
18984566
METALLURGICAL-A
2.08
-0.952381
14537300
2.46
-0.4048583
8894570 36624515
CHINA PACIFIC-A
CHINA RAILWAY-A
2.97
-0.6688963
17793896
NINGBO PORT CO-A
CHINA SHENHUA-A
22.55
-0.6170119
8535911
PANGANG GROUP -A
3.44
-2.824859
8.68
-0.5727377
MOVERS
48
245
7 2274
INDEX 2242.635
CHINA SHIPBUIL-A
4.14
-0.2409639
21203523
PETROCHINA CO-A
7720971
HIGH
2274.27
CHINA SOUTHERN-A
3.49
-0.5698006
14534109
PING AN BANK-A
14.06
-1.264045
18964925
LOW
2242.64
CHINA STATE -A
3.36
0.2985075
94560627
PING AN INSURA-A
38.86
-2.557673
23370652
CHINA UNITED-A
3.31
-0.6006006
31184267
POLY REAL ESTA-A
12.44
1.220504
47698177
CHINA VANKE CO-A
9.32
0.8658009
68234120
QINGDAO HAIER-A
11.63
0.8673027
9093082
CHINA YANGTZE-A
6.57
-0.1519757
11021388
QINGHAI SALT-A
24.24
-0.9803922
3565602
PRICE DAY %
Volume
PRICE DAY %
Volume
52W (H) 2717.825 (L) 2102.135
2242
11-December
13-December
FTSE TAIWAN 50 INDEX NAME
NAME
NAME
PRICE DAY %
25.45
0.9920635
20127804
FORMOSA PLASTIC
78.8
1.025641
6756575
TAIWAN MOBILE CO
106
ADVANCED SEMICON
25.05
0.2
19838415
FOXCONN TECHNOLO
97.2
0.3095975
7256626
TPK HOLDING CO L
500 -0.3984064
ASIA CEMENT CORP
37.7
0.3994674
4031529
33.95
0.7418398
17898470
TSMC
99.2
ASUSTEK COMPUTER
334.5
4.53125
10741933
HON HAI PRECISIO
96
0.41841
32046503
UNI-PRESIDENT
54 -0.7352941
AU OPTRONICS COR
13.95
6.896552
301571425
HOTAI MOTOR CO
217
0
674096
UNITED MICROELEC
12
CATCHER TECH
146.5
0.3424658
9693391
HTC CORP
285
0.8849558
24146480
WISTRON CORP
31.45
1.779935
5120941
CATHAY FINANCIAL
31.55
0.477707
20594636
HUA NAN FINANCIA
16.7
0.6024096
12668794
YUANTA FINANCIAL
15.3
0.6578947
15450247
CHANG HWA BANK
16.1
0.625
12999599
LARGAN PRECISION
842
-1.979045
2738535
YULON MOTOR CO
54.7
1.296296
7504512
CHENG SHIN RUBBE
77
0.6535948
5401750
LITE-ON TECHNOLO
39.85
0.5044136
5935844
15.55
6.872852
143442207
MEDIATEK INC
339.5 -0.2936858
23322783
7.7
4.904632
183676614
MEGA FINANCIAL H
CHINA STEEL CORP
26.45
0.5703422
31802337
CHINATRUST FINAN
17.75
0.8522727
33977125
CHIMEI INNOLUX C CHINA DEVELOPMEN
CHUNGHWA TELECOM COMPAL ELECTRON DELTA ELECT INC
94.4 -0.4219409 20
1.010101
FUBON FINANCIAL
23
0.4366812
25414352
NAN YA PLASTICS
56.3
4.841713
12359064
PRESIDENT CHAIN
157.5
0
2284099
8242053
QUANTA COMPUTER
68.5
2.852853
22065355
36268495
SILICONWARE PREC
31.5
0
8127234
108
0.9345794
5676357
SINOPAC FINANCIA
12.65
0.7968127
27370076
FAR EASTERN NEW
34
0.8902077
17849319
SYNNEX TECH INTL
55.7
3.724395
9674677
FAR EASTONE TELE
74
-1.201602
9647440
TAIWAN CEMENT
39.05
0.1282051
7773351
18
0
13429950
TAIWAN COOPERATI
16.3
0.3076923
8190490
FORMOSA CHEM & F
FIRST FINANCIAL
70.5
1.293103
6421201
TAIWAN FERTILIZE
77.4
2.110818
7102992
FORMOSA PETROCHE
88.5
0.3401361
2355065
TAIWAN GLASS IND
29.3
1.384083
1106429
MOVERS
38
7
0
Volume
ACER INC
0.8130081 3.896104
3652060 6116306 40024236 12142486 112715894
5 5400
INDEX 5482.48 HIGH
5482.48
LOW
5337.22
52W (H) 5621.53 5330
(L) 4643.05 11-December
13-December
December 14, 2012 business daily | 13
MARKETS GAMING STOCKS - DAILY PERFORMANCE (Hong Kong Stock Exchange) GALAXy ENTErTAINMENT
MELCo CroWN ENTErTAINMENT
MGM CHINA HoLDINGS
29.40
41.4
14.10
40.9
14.05
40.4
14.00
29.07
Max 29.40
Average 28.025
Min 28.75
28.75
Last 29
SANDS CHINA LTD
Average 34.004
Max 34.6
Max 41.4
Average 40.99
Min 33.7
Last 34.55
Max 14.1
Average 14.024
Min 13.96
WyNN MACAU LTD 17.70
21.40
34.30
17.59
21.20
34.00
17.48
21.00
33.70
17.37 Max 17.70
Average 17.59
PRICE
WTI CRUDE FUTURE Jan13
86.34
-0.495562983
-11.70876368
109.6699982
79.68000031
BRENT CRUDE FUTR Jan13
109.06
-0.401826484
5.371980676
120.7699966
90.15999603
GASOLINE RBOB FUT Jan13
263.85
-0.302286038
6.675022237
293.3099985
218.4999943
921
-0.216684724
2.761506276
1036.25
799.25
3.374
-0.236546422
-13.10842132
4.127000332
3.062000036
NATURAL GAS FUTR Jan13 HEATING OIL FUTR Jan13
DAY %
YTD %
(H) 52W
Min 17.38
Last 17.62
20.80 Max 21.40
Average 21.022
296.83
0.050559525
3.302707594
334.2199802
255.5699825
1698.45
-0.8893
8.5334
1796.08
1522.75
Silver Spot $/Oz
32.8938
-0.6866
18.1742
37.4775
26.1513
Platinum Spot $/Oz
1619.78
-1.0912
16.1549
1736
1339.25
687
-1.2576
5.1262
725.19
553.75
Palladium Spot $/Oz LME ALUMINUM 3MO ($)
2140
1.134215501
5.940594059
2361.5
1827.25
LME COPPER 3MO ($)
8130
0.37037037
6.973684211
8765
7131
LME ZINC
2095
0.721153846
13.5501355
2220
1745
3MO ($)
LME NICKEL 3MO ($)
PRICE
(L) 52W
Gold Spot $/Oz
MAJORS
ASIA PACIFIC
CROSSES
17700
-0.561797753
-5.39818279
22150
15236
15.29
-0.358422939
-0.423314881
16.60000038
14.60000038
722.5
-0.413507926
20.36651395
846.25
511
WHEAT FUTURE(CBT) Mar13
811
-0.123152709
10.49046322
948.25
652
SOYBEAN FUTURE Mar13
1467
-0.238014281
19.85294118
1728.25
1138
ARISTOCRAT LEISU
146.05
-0.307167235
-38.62155915
249
145.5
AGRICULTURE ROUGH RICE (CBOT) Jan13 Mar13
COFFEE 'C' FUTURE Mar13
Last 20.40
Min 20.80
AUD GBP CHF EUR JPY MOP HKD CNY INR THB SGD TWD PHP IDR AUDJPY EURCHF EURGBP EURCNY EURMOP EURJPY HKDMOP
DAY %
1.0548 1.6132 0.9249 1.3071 83.32 7.9826 7.7501 6.2326 54.455 30.65 1.2205 29.075 41.053 9689 87.883 1.20893 0.81025 8.1612 10.4338 108.9 1.03
0.0854 -0.062 0.5622 0.3301 -0.5641 -0.0013 -0.0013 0.3032 -0.2479 -0.0653 0.0737 -0.0378 -0.1047 -0.1961 -0.6383 0.2275 -0.3949 -0.4227 -0.3364 -0.8815 0
YTD %
(H) 52W
3.3206 3.7895 1.4272 0.8487 -7.6932 0.213 0.2232 1.0012 -2.5526 2.9364 6.2351 4.141 6.7888 -6.399 -10.7541 0.6502 2.8559 -0.3308 -0.784 -8.4848 0.0097
(L) 52W
1.0857 1.6309 0.9972 1.3487 84.18 8.0198 7.7864 6.3964 57.3275 32 1.3138 30.396 44.35 9752 88.637 1.23977 0.8506 8.4894 10.7712 111.44 1.0314
0.9582 1.5235 0.8931 1.2043 76.03 7.9823 7.7498 6.2105 48.6088 30.2 1.2152 28.914 40.795 8875 74.482 1.19995 0.77553 7.7018 9.6245 94.12 1.029
MACAU RELATED STOCKS NAME
PRICE
(H) 52W
(L) 52W
3.13
DAY % YTD % 0.9677419
42.27272
3.32
2.16
VOLUME CRNCY 2005948
CROWN LTD
10.34
1.472031
27.81211
10.34
7.92
2294242
SUGAR #11 (WORLD) Mar13
18.5
-0.21574973
-20.80479452
25.12999916
18.43000031
AMAX HOLDINGS LT
0.065
-1.515152
-25.28735
0.119
0.055
2665000
COTTON NO.2 FUTR Mar13
74.8
-0.425985091
-15.48977517
98.5
66.84999847
BOC HONG KONG HO
24
0.6289308
30.43479
25
17.46
12391512 203000
World Stock MarketS - Indices NAME
CENTURY LEGEND
0.26
0
13.04348
0.335
0.204
CHEUK NANG HLDGS
4.59
-0.2173913
63.92857
4.6
2.5
94284
CHINA OVERSEAS
23.4
-1.886792
80.48039
24.25
12.066
17795500
CHINESE ESTATES
11.8
1.37457
-5.6
13.26
8.3
51500
CHOW TAI FOOK JE
11.88
1.192504
-14.65517
15.16
8.4
5597300
EMPEROR ENTERTAI
1.65
-1.197605
48.64865
1.82
0.99
1640020
FUTURE BRIGHT
1.16
-1.694915
176.1905
1.43
0.38
1686000
29
0
103.6517
29.85
13.28
8605460
117.6
-0.42337
27.61801
120
91.15
1499725
COUNTRY
PRICE
DAY %
YTD %
(H) 52W
(L) 52W
DOW JONES INDUS. AVG
US
13245.45
-0.02256869
8.413224
13661.87
11735.19
NASDAQ COMPOSITE INDEX
US
3013.814
-0.2808455
15.68678
3196.932
2518.01
HANG SENG BK
FTSE 100 INDEX
GB
5935.41
-0.1755847
6.516729
5989.07
5229.76
HOPEWELL HLDGS
31.1
0.3225806
58.656
31.6
19.049
864000
DAX INDEX
GE
7582.1
-0.4292961
28.54612
7626.4
5637.53
HSBC HLDGS PLC
80.25
0.3752345
36.01695
80.3
57.05
14270921
NIKKEI 225
JN
9742.73
1.683146
15.22564
10255.15
8238.96
HANG SENG INDEX
HK
22445.58
-0.2567173
21.75927
22563.14063
17821.51953
CSI 300 INDEX
CH
2242.635
-1.108227
-4.395494
2717.825
TAIWAN TAIEX INDEX
TA
7757.09
0.8699395
9.686114
8170.72
KOSPI INDEX
S&P/ASX 200 INDEX
SK
2002.77
1.383489
9.696344
2057.28
GALAXY ENTERTAIN
3.55
0
18.7291
3.88
2.84
6708000
LUK FOOK HLDGS I
24
-1.437372
-11.43912
33.2
14.7
2834000
MELCO INTL DEVEL
8.74
0
51.47314
8.81
5.12
3374000
2102.135
MGM CHINA HOLDIN
14.1
1.002865
46.99514
14.76
9.432
1415040
6609.11
MIDLAND HOLDINGS
3.65
-1.351351
-7.689513
5.217
3.249
4504000
NEPTUNE GROUP
0.155
0
39.63964
0.222
0.084
1110000
NEW WORLD DEV
12.14
-0.9787928
93.92971
13.2
6.13
12754185
SANDS CHINA LTD
15747545
1750.6
HUTCHISON TELE H
AU
4582.793
-0.02218678
12.97238
4603.5
3985
ID
4320.189
-0.3997438
13.03501
4381.746094
3635.283
FTSE Bursa Malaysia KLCI
MA
1652.75
0.1818457
7.971361
1679.37
1448.54
NZX ALL INDEX
NZ
860.457
-0.4401448
17.90307
878.077
712.548
SJM HOLDINGS LTD
17.62
PHILIPPINES ALL SHARE IX
PH
3721.51
-0.2514145
22.21547
3756.31
2965.32
SMARTONE TELECOM
14.28 21.4
ASIA ENTERTAINME BALLY TECHNOLOGI
JAKARTA COMPOSITE INDEX
13.95
Last 14.1
34.60
NAME
CORN FUTURE
39.9
CURRENCY EXCHANGE RATES
GAS OIL FUT (ICE) Jan13
METALS
Last 41.4
SJM HoLDINGS LTD
Commodities ENERGY
Min 39.9
34.55
3.134328
57.40318
34.65
20.35
SHUN HO RESOURCE
1.4
-0.7092199
40
1.43
0.97
178000
SHUN TAK HOLDING
4.16
-1.187648
62.55535
4.23
2.418
7995722
1.732102
40.8976
18.36
11.973
6395959
-0.1398601
6.250003
17.5
12.96
1867798
3.381643
9.74359
25.5
14.62
10753000
3.05
1.666667
-48.12925
7.24
2.4
128352
45.67
0
15.44489
51.16
35.79
342178
WYNN MACAU LTD
HSBC Dragon 300 Index Singapor
SI
618.15
1.08
24.54
NA
NA
STOCK EXCH OF THAI INDEX
TH
1354.4
-0.01255011
32.09536
1360.23
1006.16
HO CHI MINH STOCK INDEX
VN
391.19
0.02812724
11.27578
492.44
332.28
BOC HONG KONG HO
3.04
-1.935484
26.81528
3.3
2.24
7754
Laos Composite Index
LO
1215.76
0.6732194
35.16554
1249.34
876.33
GALAXY ENTERTAIN
3.82
4.657534
104.2781
3.87
1.75
11500 4943949
Shanghai Shenzhen Composite index is listing the biggest companies by market capitalisation. All data supplied by Bloomberg unless otherwise indicated.
INTL GAME TECH
14.45
0.6267409
-15.98838
18.1
10.92
JONES LANG LASAL
83.59
-0.2862937
36.4512
87.52
56.51
135247
LAS VEGAS SANDS
45.34
1.796138
12.96426
58.3216
32.6127
5749122 6873208
MELCO CROWN-ADR
16.18
3.717949
68.19127
16.235
8.32
MGM CHINA HOLDIN
1.8
0
51.04559
1.96
1.1917
100
MGM RESORTS INTE
11.32
3.568161
8.533074
14.9401
8.83
13487557
SHFL ENTERTAINME
13.24
-0.4511278
12.96928
18.77
10.61
189406
SJM HOLDINGS LTD
2.2
0.456621
36.85228
2.36
1.5484
5900
113.4568
3.330419
9.512699
129.6589
84.4902
2570476
WYNN RESORTS LTD
AUD HKD
USD
14 |
business daily December 14, 2012
Opinion East Asia’s turning point
agenda foundered on growing Chinese assertiveness, leading successive DPJ governments to bolster Japan’s security ties with the US.
Resurgence of nationalism Brahma Chellaney
P
Professor of Strategic Studies at the New Delhi-based Centre for Policy Research
olitical transitions in East Asia promise to mark a defining moment in the region’s jittery geopolitics. After the ascension in China of Xi Jinping, regarded by the People’s Liberation Army (PLA) as its own man, Japan seems set to swing to the right in its impending election – an outcome likely to fuel nationalist passion on both sides of the Sino-Japanese rivalry. Japan’s expected rightward turn comes more than three years after voters put the left-leaning Democratic Party of Japan (DPJ) in power. By contrast, South Korea’s election – scheduled for December 19, just three days after the Japanese go to the polls – could take that country to the left, after the nearly five-year rule of rightist President Lee Myung-bak, who proved to be a polarising leader. These political transitions could compound East Asia’s challenges, which include the need to institute a regional balance of power and dispense with historical baggage that weighs down interstate relationships, particularly among China, Japan, and South Korea. Booming trade in the region has failed to mute or moderate territorial and other disputes; on the contrary, it has only sharpened regional
geopolitics and unleashed high-stakes brinkmanship. Economic interdependence cannot deliver regional stability unless rival states undertake genuine efforts to mend their political relations. The scandals surrounding the top aides to Lee – nicknamed “the Bulldozer” from his career as a construction industry executive – have complicated matters for the ruling Saenuri Party’s candidate, Park Geunhye, and buoyed the hopes of her leftist rival, Moon Jae-in of the Democratic United Party. Park is the daughter of former president, General Park Chunghee, who seized power in a military coup in 1961.
Powerful chaebol Reining in South Korea’s powerful chaebol (family-run conglomerates) has become a key issue in the presidential election, with even Park favouring tighter control over them, although it was her father’s regime that helped build them with generous government support. Her populist stance on the chaebol suggests that, if elected, she might similarly pander to nationalist sentiment by taking a tough stance against Japan, especially to play down her father’s service in Japan’s military while Korea was under Japanese colonial rule. But, even if Moon becomes
The central challenge for East Asia’s major economies is to resolve the historical issues that are preventing them from charting a more stable and prosperous future
president, the new strains in South Korea’s relationship with Japan, owing to the revival of historical issues, may not be easy to mend. Earlier this year, Lee, at the last minute, cancelled the scheduled signing of the “General Security of Military Information Agreement”
with Japan, which would have established military intelligence-sharing between the two countries, both U.S. allies, for the first time. Lee also scrapped a bilateral plan to finalise a military-related Acquisition and CrossServicing Agreement. Weeks later, he provocatively visited the contested islets known as the Dokdo Islands in South Korea (which controls them) and the Takeshima Islands in Japan. China, meanwhile, has cast a long shadow over the Japanese parliamentary elections. In recent months, China has launched a new war of attrition by sending patrol ships frequently to the waters around the Japanese-controlled Senkaku islands, which China calls Diaoyu. This physical assertiveness followed often-violent antiJapanese protests in China in September, while a continuing informal boycott of Japanese goods has led to a sharp fall in Japan’s exports to China, raising the risk of another Japanese recession. The DPJ’s 2009 election victory had been expected to lead to a noticeable warming of Japan’s ties with China. After all, the DPJ came to power on a promise to balance Japan’s dependence on the U.S. with closer ties with the People’s Republic. But its bridge-building
China’s behaviour has fuelled a nationalist backlash in Japan, helping to turn hawkish, marginal politicians like Shintaro Ishihara into important mainstream figures. Japan may be in economic decline, but it is rising politically. Indeed, Albert del Rosario, the foreign minister of the Philippines, which was under Japanese occupation during WWII, now strongly supports a re-armed Japan as a counterweight to China. But the resurgence of nationalism in Japan is only fanning Chinese nationalism, creating a vicious circle from which the two countries are finding it difficult to escape. Shinzo Abe of the Liberal Democratic Party, who is likely to become Japan’s next prime minister, has vowed to take a tougher line on Senkaku and other disputes with China. More important, the LDP has called for revising Article 9 of Japan’s U.S.-imposed post-1945 constitution, which renounces war. The risks posed by increasing nationalism and militarism to regional peace have already been highlighted by the rise of a new Chinese dynasty of “princelings,” or sons of revolutionary heroes who have widespread contacts in the military. The real winner from the recent appointment of the conservative-dominated, sevenmember Politburo Standing Committee is the PLA, whose rising clout has underpinned China’s increasingly assertive foreign policy. In fact, what distinguishes Xi from China’s other civilian leaders is his strong relationship with the PLA. As Xi rose through the Communist Party ranks, he forged close military ties as a reservist, assuming leadership of a provincial garrison and serving as a key aide to a defence minister. His wife, Peng Liyuan, is also linked to the military, having served as a civilian member of the army’s musical troupe, and carries an honorary rank of general. Against this background, the central challenge for East Asia’s major economies – particularly Japan and South Korea – is to resolve the historical issues that are preventing them from charting a more stable and prosperous future. As a Russian proverb warns, “Forget the past and lose an eye; dwell on the past and lose both eyes.” © Project Syndicate
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December 14, 2012 business daily | 15
OPINION China needs Carson Block wires to help keep it honest Business
Leading reports from Asia’s best business newspapers
Yomiuri Shimbun
William Pesek
Bloomberg View columnist
The Financial Services Agency has compiled an outline for tightening regulations over insider trading, following a series of illegal trading incidents involving the leakage of companies’ internal information by major securities firms. Under the outline information leaks will be covered by the rules in cases where corporate information is leaked for the purpose of illegal trading and when illegal transactions actually take place. If officials of securities firms leak such information, the agency will make their names public. It plans to submit a bill to revise the law next year.
land grabs, insider trading and old-fashioned rent seeking.
Big scandals
Bangkok Post Asian policy makers may have to accelerate efforts to reorient growth strategies to mitigate the problems of international spillovers in the global markets, according to Glenn Stevens, the governor of the Reserve Bank of Australia. “The traditional Asian strategy of export-driven growth assisted by a low exchange rate worked well when Asia was small,” he said in an address on challenges for central banking at the Bank of Thailand’s Policy Forum on Wednesday. “Asia isn’t small any more, and so the rest of the world will not be able to absorb the growth in Asian production in the same way as it once did.”
Business Inquirer Singapore Airlines’ sale of its 49-percent stake in Virgin Atlantic will allow the cashrich Asian carrier to focus resources on its fast-growing regional market, analysts said Wednesday. Singapore Airlines on Tuesday said it will sell the stake to Delta Air Lines of the United States for US$360 million in cash in a deal to be completed next year. “SIA can now focus on investments in the Asia Pacific region,” Brendan Sobie, a Singaporebased analyst with industry consultancy Centre for Aviation, was quoted as saying.
The Star Samsung Malaysia Electronics is targeting a stronger growth in profit and revenue from the small and medium enterprises segment in Malaysia over the next couple of years. According to its business-to-business unit vice president Varinderjit Singh, Samsung Malaysia targets to be the market leader in providing solutions for SME customers. “SMEs now account for 30 percent to 40 percent of businesses in Malaysia and this will be the main growth area for Samsung. We will see more innovative products from Samsung for this sector due to the size of the companies,” he was quoted as saying.
N
othing ruins a chief executive officer’s year faster than hearing the name Carson Block. Allen Chan can attest to that. In April, he resigned from Sino-Forest Corp., the Chinese forestry company he co-founded two decades ago, after being targeted by Block’s Muddy Waters LLC. The short-selling firm shot to fame by correctly betting on declines in stocks of Chinese companies listed in North America, much in the same way that David Einhorn rose to prominence for being right on Lehman Brothers Holdings Inc.
One reason China could … welcome domestic short sellers is to go after dodgy U.S. companies that make a mockery of capitalism
This hasn’t gone over well in China, where foreign critics can trigger an intense level of nationalistic suspicion. When Greenlight Capital Inc.’s Einhorn shorts Japan, officials in Tokyo, while not happy, move on. But when Jim Chanos of Kynikos Associates Ltd bets against China, hostility abounds. In September, a group of more than 60 Chinese entrepreneurs and executives signed an open letter accusing
Citron Research and other short sellers of manipulating information and misleading investors. Rather than circle the wagons against Block, China should realise that some good can come from his tactics. Many of China’s companies need serious scrutiny. One reason China could just join him and welcome domestic short sellers is to go after dodgy U.S. companies that make a mockery of capitalism. Hewlett-Packard Co.’s accounting scandal is but the latest reminder that U.S. practices are far from ideal. After Wall Street’s crash and the shenanigans at Enron Corp. and WorldCom Inc., Chinese have reason to do their own police work on the U.S. The real benefit, though, is domestic.
Real fire I’m not defending all of the practices of short sellers. Anyone who manipulates stocks or bonds by introducing false information into the market should be scrutinised, too. Sometimes, though, there really is fire where there is smoke. Consider how many times Lehman chairman Richard Fuld denounced the traders who turned out to be right about his company. Or how many times Sino-Forest executives dismissed Block as a complete nut. None of this means Muddy Waters is right about all of its strong-sell reports. And it might not matter, as Carson is deemphasising his positions on China – for now. Singapore’s Sunny Verghese, CEO of Olam International Ltd, is Block’s latest fixation. No one knows whether Muddy Waters is correct that the giant commodity trader is on the verge of insolvency. All we
know is that someone will end up with mud on the face. But why turn away from China? “China has gotten harder in the sense that the government has really taken the side of the fraud,” Block told Bloomberg News on November 27. “The government is working with a number of these companies to try to conceal records that are public. When you are up against that sort of strength of the ability to revise history, it becomes difficult. That is one of the reasons we’re not that interested in China anymore.” That’s why China’s topdown capitalism needs pressure from the inside, from investors on the ground. At a time when corruption is on the rise, China needs a chorus of home-grown voices asking questions. It is too loaded and charged when the criticism comes from the outside. Chinese should become stakeholders in their system, not just shareholders. China knows no bigger bull market than applications to join the Communist Party. Why? The big money is in government. It’s in dubious
The big scandals of 2012 bear that out. One surrounding Chongqing politician Bo Xilai shined a bright light on the vast wealth amassed by his extended family. In June, Bloomberg News reported on the accumulated wealth of the family of Xi Jinping, China’s next president. More recently, the New York Times alleged that the family of departing Premier Wen Jiabao has made billions of dollars. China’s response to sensitive news reports is to silence the messenger. Both the Bloomberg and Times websites were blocked in China. Censoring cyberspace doesn’t change the fact that Transparency International ranks China behind Tunisia, whose leadership fell amid the Arab Spring movement, in its Corruption Perceptions Index. Say a mainland investor thinks a state-owned company’s balance sheet doesn’t add up. Or an economist doubts gross domestic product or trade data. Would he or she feel safe airing those views? Jack Welch can blab all he wants about U.S. jobs data he thinks are cooked, though he’s wasting his breath. The lack of dissenting views to challenge the conventional wisdom doesn’t help China; it holds the country back. China’s markets are so blatantly rigged in favour of the political class that it impedes needed reforms. The will to deregulate the economy, clean up banks and strengthen corporate governance shrinks as overseas bank accounts swell. What the Blocks of the world do, if they are acting ethically, is question the status quo. They poke holes in profits that look too good to be true, balance sheets that are too opaque for comfort and executives who use mergers and acquisitions to hide weaknesses or losses. China could do with its own swarm of market players doing just that. Bloomberg View
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business daily December 14, 2012
CLOSING Mainland showbiz brokerage open to Macau Renault sells Volvo holding to lower debt Residents from Macau, Hong Kong and Taiwan can become qualified to be show business brokers on mainland China by taking exams, according to a new Ministry of Culture regulation. Qualification exams will be held twice annually and the China Trade Association for Performances will be responsible for issuing certificates, the official news agency Xinhua reported yesterday. China had more than 2,600 entertainment agencies and 23,000 professionals last year, ministry figures showed.
Renault SA, which is losing sales faster than any other European carmaker, sold its remaining Volvo AB stake for 12.8 billion kronor (US$1.92 billion) to boost funding, ending an 11-year run as the Swedish truckmaker’s largest owner. Renault disposed of a 6.5 percent holding at 92.25 kronor per share, 3.8 percent below Wednesday’s closing price of 95.90 kronor, to reduce debt and invest in France, Russia and China, the company said in a statement yesterday. Renault sold a 14.9 percent Volvo stake in 2010.
Euro zone agrees strict bank rules Supervision lays a cornerstone of wider economic union
Europe deepens union with ECB as chief bank watchdog
E
urope clinched a deal yesterday to give the European Central Bank new powers to supervise euro zone banks from 2014, embarking on the first step in a new phase of closer integration to help underpin the euro. After more than 14 hours of talks and following months of tortuous negotiations, finance ministers from the European Union’s 27 countries agreed to hand the ECB the authority to directly police at least 150 of the euro zone’s biggest banks and
intervene in smaller banks at the first sign of trouble. “This is a big first step for banking union,” EU Commissioner Michel Barnier told a news conference. “The ECB will play the pivotal role, there’s no ambiguity about that.” After three years of piecemeal crisis-fighting measures, agreeing on a banking union lays a cornerstone of wider economic union and marks the first concerted attempt to integrate the bloc’s response to problem banks. The new system of supervision
should be up and running by March 1, 2014, following talks with the European Parliament, although ministers agreed that could be delayed if the ECB needed longer to prepare itself.
Differences settled The plan sets in motion one of the biggest overhauls of any European banking system since the financial crisis began in mid-2007 with the near collapse of German lender IKB.
The onus is now on EU leaders, who meet in Brussels until today, to give it their full political backing. In an about-turn, German Finance Minister Wolfgang Schaeuble dropped earlier objections that had led him to clash openly with his French counterpart, Pierre Moscovici, last week over the ECB’s role in banking supervision. With time running out to meet a year-end deadline, both sides managed to settle their differences and Germany won concessions to temper the authority of the ECB’s Governing Council over the new supervisor. Agreement on bank surveillance is a crucial first step towards a broader banking union, or common euro zone approach to dealing with failing banks that in recent years dragged down countries such as Ireland and Spain. The next pillar of a banking union would be the creation of a central system to close troubled banks. The decision also sends a strong signal to investors that the euro zone’s 17 members, from powerful Germany to stricken Greece, can pull together to tackle the bloc’s problems. At a summit in June, EU leaders pledged that once a common bank supervisor was in place, the bloc’s rescue mechanism would have the power to directly recapitalise struggling banks. Countries like France, Italy and Spain are keen for those powers to be in place as soon as possible. But Germany, worried it could be forced to foot the bill for struggling banks across the bloc, is not in a rush. “We have reached the main points to establish a European banking supervisor that should take on its work in 2014,” Mr Schaeuble told reporters. “We stand by what we agreed, to bring Europe forward step by step.” Reuters
Bailout cash for Greece approved EU, IMF agree to lend 49 bln euros by March
E
uro zone finance ministers and the International Monetary Fund have agreed to release 49.1 billion euros (US$64 billion) in aid to Greece by the end of March, with most of that sum flowing immediately, senior EU officials said yesterday. “Money will be flowing to Greece as early as next week,” Eurogroup chairman Jean-Claude Juncker told a news conference after a meeting of ministers from the single currency bloc. “We are convinced the
programme is back on a sound track.” A Eurogroup statement said 34.3 billion euros would be paid out in the coming days and the remainder in the first quarter of 2013. Agreement to release the funds hinged on the success of a debt buyback launched by Greece last week, which will enable Athens to retire bonds repurchased at a third of their face value from private holders. The Greek government this week said it plans to pay 11.29 billion
euros to buy back 31.9 billion euros of bonds to reduce its debt burden. The buyback underscores a move away from the austerity-first measures European leaders have embraced since the financial crisis began in 2009. To repurchase all the debt tendered, Greece needed approval to spend more than the 10 billion-euro loan from Europe’s bailout fund earmarked for the buyback. Mr Juncker said he was not sure
that additional measures would be needed to reach an agreed goal to bring Greece’s debt down to 124 percent of gross domestic product (GDP) by 2020, but the bloc stood ready to take new steps if necessary. “The disbursement agreed to today will allow for liquidity to flow back into the Greek economy,” European Union Economic and Monetary Affairs Commissioner Olli Rehn said at a press conference. Reuters/Bloomberg News