China in innovation challenge to Europe

May 16, 2013 12:03 am

China in innovation challenge to Europe

By Chris Bryant in Frankfurt

Europe’s business leaders fear its industry will fall behind China in technological innovation within a decade as the economic crisis undermines one of the continent’s competitive advantages.

More than two-thirds of business leaders surveyed by Accenture, the consultancy, on behalf of BusinessEurope, the business lobby group, said China would reach or pull ahead of Europe in innovation by 2023.

Weak demand caused by Europe’s economic crisis has sent industrial production into decline, while corporate reluctance to delve into cash reserves is holding back new investment, training and R&D. Read more of this post

Beijing signals concerns at rising unemployment

May 15, 2013 4:35 pm

Beijing signals concerns at rising unemployment

By Jamil Anderlini in Beijing

China’s newly installed leaders have signalled their concern about rising unemployment in the slowing Chinese economy with several carefully stage-managed public appearances this week.

On Tuesday, Chinese President Xi Jinping paid a surprise visit to a job fair in the eastern city of Tianjin while Premier Li Keqiang warned the country faces an unprecedented challenge in finding jobs for a record number of university graduates.

In a nationwide teleconference on Monday that was widely reported in state media on Wednesday, Mr Li said that nearly 7m tertiary students would enter the job market in July in China, the largest number in the country’s history.

He said it was an “important task” to find jobs for all these graduates, who make up a demographic considered potentially threatening to Communist Party rule if they become disaffected in large numbers. Read more of this post

China’s companies spurn directive to pay 30% dividend; Just 60 per cent of China’s biggest listed-companies met the dividend guidelines, a blow for attempts to build credibility in China’s equity markets

May 16, 2013 5:48 am

China’s companies spurn directive to pay 30% dividend

By Josh Noble in Hong Kong

Just 60 per cent of China’s biggest listed-companies met the dividend guidelines laid out by the Shanghai stock exchange earlier this year, a blow for attempts to build credibility in China’s equity markets.

Of the members of the FTSE A50 index, only 30 companies paid a dividend of over 30 per cent during the most recent earnings season, according to data compiled by Markit.

In January, the Shanghai bourse told listed companies to return at least 30 per cent of profits to shareholders“because of a definite gap between cash dividend ratios for Shanghai-listed companies and those in mature markets”. Read more of this post

China is addicted to debt and shows few signs of kicking the habit, says Francis Cheung

Thursday, May 16, 2013

China is addicted to debt and shows few signs of kicking the habit, says Francis Cheung

Credit can be like steroids for developing countries. Pump loans to businesses and governments, and they will be better able to tap into the latent opportunities of an undeveloped economy.

But as Francis Cheung, head of China and Hong Kong strategy at brokerage CLSA, points out, China has become addicted to debt to fuel growth. And like habitual steroid use, eventually growing debt will threaten the health of the overall system.

Cheung authored a report earlier this month sounding the alarm on how the levels of debt are piling up with no sign of slowing while bringing fewer benefits to the economy. More than half of China’s total debt was added in the past four years, the bulk of which came from shadow banking and bonds. The country’s debt level sits at roughly 205% of GDP as of 2012.

On the sidelines of the CLSA China Forum 2013 in Beijing earlier this week, Cheung spoke to CHINA ECONOMIC REVIEW about where the biggest risks lie and their possible solutions, even if it’s unlikely they’ll be enacted Read more of this post

Chairman of Sinovel has resigned as of one of the country’s largest makers of wind turbines struggles amid an industry downturn

05.15.2013 18:20

Head of Sinovel Resigns amid Company Struggles

Wei Chiyuan steps down as chairman after pursuing reforms that could not keep firm profitable during industry downturn

By staff reporter Pu Jun

(Beijing) – The chairman and acting president of Sinovel Wind Energy Group Co. has resigned as of one of the country’s largest makers of wind turbines struggles amid an industry downturn. Read more of this post

Hukou Age Limits Anger Graduates; A new policy prevents college graduates who are too old from getting Beijing residence

Hukou Age Limits Anger Graduates

By Liu Jinsong (刘金松) and Hu Dan (胡丹)
Issue 619, May 13, 2013
When Zhang Xin (a pseudonym) went online to find information about getting a Beijing hukou (household registration), he came across an agency saying that it would cost 220,000 yuan for people “within the age limit.” But for people over the “age limit,” it would cost an additional 40,000 yuan for them to work around “new rules.”

Zhang will finish his master’s degree at Peking University this June, and has already signed a contract with a well-known international company. Many people in his situation can obtain a Beijing hukou through their job so that they access certain social services within the city. Zhang Xin had counted on this.

However, the “age limits” mentioned by the online agency was the first mention he’d heard of any new rules. He thought it might be a scam, so he went to the company he was set to work for, as well as the employment office at his university. They all said they hadn’t heard of any age limits on obtaining a hukou. But after searching more online, Zhang found that the agency wasn’t a scam. Many others were facing the same problem. Read more of this post

Ping An’s investment in Chinese cosmetics company Jahwa turns sour; public is keen to know what went wrong with to the seemingly perfect investment

Ping An’s investment in Jahwa turns sour

Staff Reporter

2013-05-16

After Ge Wenyao stepped down as chairman of Shanghai Jahwa United, a listed Chinese cosmetics company, the public is keen to know what went wrong with to the seemingly perfect investment made by the Ping An Trust, a strategic investor that was introduced into the business by Ge himself. Read more of this post

Challenging domination of oil’s powerful few

May 15, 2013 8:05 pm

Challenging domination of oil’s powerful few

By Ajay Makan in London

For decades the physical oil market has been the unregulated preserve of a few powerful companies. But in the wake of the Libor scandal, it is subject to intense scrutiny. Energy companies including BP, Royal Dutch Shell and Statoil, the majors raided by the European Commission on Tuesday in a probe into possible price rigging, have long dominated the trade. A handful of large commodity trading houses, hedge funds and investment banks are the other big participants. The market is not overseen by governments or exchanges, but by companies such as Platts, a price reporting agency (PRA) which publishes daily assessments that are gospel in the world of physical commodities. That gives Platts, a unit of the New York-listed McGraw Hill Financial, which was also raided on Tuesday, huge influence. According to Platts, its daily assessment of dated Brent, as the physical North Sea oil market is known, is the reference price for 60 per cent of crude traded worldwide. Dated Brent also underpins exchange-traded derivatives used by airlines to hedge prices and, along with taxes, Platts’ crude and product prices determine the price of petrol at the pump. The power of Platts has not gone unnoticed. Read more of this post

Vietnam must ditch state-sponsored crony capitalism

Last updated: May 15, 2013 8:03 pm

Vietnam must ditch state-sponsored crony capitalism

By David Pilling

For a country in its demographic sweetspot, the economy is not growing fast enough

The country has just emerged from a scandal that exposed virulent corruption at the heart of the Communist party. There is a pressing need to reform state-owned enterprises – behemoths of inefficiency, patronage and powerful vested interests. The internet is awash with stories about arbitrary land grabs, prisoners of conscience and the antics of the party’s privileged offspring. It sounds like China, but this is Vietnam, another one-party state where the economic and social aspirations of the people are bumping up noisily against a rigid and flawed political system. Read more of this post

Indonesians mark the 15th anniversary of the fall of Suharto

Editorial: Indonesia Must Rise to Future Challenges

By Jakarta Globe on 1:00 am May 16, 2013.
As Indonesians mark the 15th anniversary of the fall of Suharto, they have every right to be proud of how far their nation has come. On May 21, 1998, Indonesia was a nation in crisis and on the verge of being balkanized. The government was in disarray and the economy was in free fall.

Riots, looting and mass demonstrations had erupted in major cities across the country. Money was fleeing the country and businessmen ran for the exit. The future looked bleak and chaos was the order of the day.

Fifteen years on, Indonesia is a nation transformed. It is the darling of foreign investors and a member of the G-20 group of largest economies in the world. It is a thriving democracy and a respected voice in regional and global affairs. Businesses are booming and a young middle class is rising.

Those chaotic days seem a distant memory now as a free press and an engaged civil society have led to political stability. The country has had two rounds of free and direct presidential and parliamentary elections without violence. Read more of this post

China ministry urges end to “forcible” land requisition; About 90,000 “mass incidents” – a euphemism for social unrest – occur each year in China, of which some two-thirds are triggered by land-related disputes

China ministry urges end to “forcible” land requisition: paper

Tue, May 14 2013

SHANGHAI (Reuters) – China’s land ministry has issued an emergency notice calling for an end to forced, illegal land requisitions, the state-run People’s Daily reported on Wednesday, stepping up efforts to defuse one of the biggest sources of public protest in China. The Ministry of Land Resources issued the notice in reaction to what the newspaper, the ruling Communist Party official publication, said had been a spate of violent land grabs. It called on regional authorities to re-examine and standardize land acquisition procedures. “Illegal acts of forcible land acquisition must be severely punished,” it said. China is rife with stories of regional governments and construction companies using strong-arm tactics to force residents to move, often with inadequate compensation, to make way for lucrative property developments. Forced evictions and land requisitions, which are widely thought to enrich officials unfairly at the expense of residents, have sparked tens of thousands of street protests and clashes over the years. The ministry said regions should conduct in-depth research into the problems behind current land disagreements and come up with targeted policies to handle them, ensuring that farmers are properly compensated, the paper said. About 90,000 “mass incidents” – a euphemism for social unrest – occur each year in China, of which some two-thirds are triggered by land-related disputes. The government has vowed repeatedly to crack down on illegal land grabs, but to little apparent effect.

Asia-Pacific Company Debt to Dwarf Developed Markets, S&P Says

Asia-Pacific Company Debt to Dwarf Developed Markets, S&P Says

Asia-Pacific corporate borrowing will exceed combined debt from the U.S., Canada, U.K. and euro zone in four years amid a surge in Chinese funding demand, according to Standard & Poor’s.

Non-financial entities in the region will probably borrow between $25 trillion and $27 trillion from 2013 to 2017, about half of the bonds and loans that will be sought globally in that period, S&P wrote in a report published today. That would boost Asia-Pacific debt to as much as $32 trillion by 2017, exceeding the projected $31 trillion total for the four North American and Western European economies, the ratings company said.

Issuers from Australia, China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, Singapore, and Thailand have sold $113.5 billion of U.S. dollar-denominated bonds in 2013, the most ever raised within the first five months of a year, data compiled by Bloomberg show. Assets held by China’s banks swelled 17 percent from a year earlier to 141.3 trillion yuan ($23 trillion) as of March 31, the China Banking Regulatory Commission said on its website yesterday. Read more of this post

Cancer Treatment’s Brutal Side Effects May Be Minimized

Cancer Treatment’s Brutal Side Effects May Be Minimized

Chemotherapy, radiation and the use of radioactive follow-up tests aren’t needed for some cancers, according to two studies that add to a growing debate on ways to lessen side effects and lower patient costs.

One study, in 1,800 men, found that chemo or radiation immediately following surgery in testicular cancer made no difference in long-term survival. A second, in 537 patients, determined that patients treated for the most common kind of lymphoma aren’t helped by expensive surveillance scans afterward that use radioactive tracers.

The two findings were released today in advance of the American Society of Clinical Oncology’s annual meeting in Chicago, set to begin May 31. They are the latest among recent studies aiming to fine-tune cancer care to eliminate the hair loss, fatigue, nausea and damaged DNA tied to the therapy while suggesting new ways to slow rising costs.

“The economics of health care and the quality of care are really being looked at more closely than in the past,” said Phil Kantoff, a professor of medicine at Harvard Medical School in Boston. “Why are you doing this? If the answer is ‘that’s what we do,’ rather than ‘there’s a study that shows we save lives this way,’ that’s not good.” Read more of this post