Talk of Inheritance Tax Sparks Debate in China

October 3, 2013, 8:30 AM

Talk of Inheritance Tax Sparks Debate in China

Whether or not to tax the dead has become a big question in China.

The country doesn’t currently have an inheritance tax—also commonly known as the death or estate tax—a levy paid by people who inherit money or property, or a tax on someone’s estate after they die. But a recent media report has sparked discussion about whether China should start levying such a tax, and if so, how heavy rates should be. The private 21st Century Business Herald reported (in Chinese) on Sept. 27 that the Communist Party’s top decision makers will consider the inheritance tax at the Third Plenum, a key meeting of senior leaders expected in November, citing Liu Heng, an academic adviser to the nation’s State Council, or cabinet. Read more of this post

Maoist Self-Criticism Comes to a TV Near You

Maoist Self-Criticism Comes to a TV Near You

On the evening of Sept. 25, Xi Jinping debuted in his role as China’s father-confessor across state-owned television stations. The occasion was the conclusion of three days of self-criticism sessions that the Chinese president oversaw in Hebei province. Wearing his signature black jacket and open-collared white shirt, Xi sat listening to nervous high-ranking local officials. They had reason to be worried: According to Xinhua News Agency, the state newswire, Xi had stern expectations for what would be accomplished (according to official press accounts, he attended four half-day sessions): “I don’t want to hear fancy words from you when I take part in your sessions. I want real criticisms and self-criticisms.” Read more of this post

China’s Poisoned Air Prompts Woman to Devise Green Tax

China’s Poisoned Air Prompts Woman to Devise Green Tax

Reading in her hotel room in 1996, geology student Cao Jing noticed something alarming: the pages of her book were being coated with brown coal dust. Her realization — in Qinhuangdao, a tourist city where China’s Great Wall meets the sea — marks the moment when the young undergraduate at Beijing’s Tsinghua University became interested in studying the effects of China’s runaway industrial pollution. It was the first step in a 17-year journey that has taken Cao, 36, into the field of economics to tackle emissions in the world’s biggest producer of greenhouse gases. Read more of this post

Former Leighton Holdings’ chief executive Wal King has denied claims he was aware of bribery and fraud allegations made against the building giant

Leighton denies culture of corruption and cover-ups

October 3, 2013 – 11:16AM

Bribery scandal engulfs Leighton Holdings

Leighton Holdings is once again facing scrutiny over its business practices following the release of internal documents. Former Leighton Holdings’ chief executive Wal King has denied claims he was aware of bribery and fraud allegations made against the building giant. Mr King’s comments came as Leighton Holdings said it was “deeply concerned” about bribery and fraud allegations made against the firm, but denied it had a culture of corruption and cover-ups. Read more of this post

Lego to Boost China Sales With Local Factories Supplying to Asia

Lego to Boost China Sales With Local Factories Supplying to Asia

Lego A/S, Europe’s biggest toymaker, plans to expand its sales in China as rising urbanization and income boost demand for its building-blocks in the world’s most-populous nation. Lego is building manufacturing facilities in China to serve both the country and across Asia, Chief Executive Officer Joergen Vig Knudstorp said yesterday. The region contributes about 10 percent of revenue, he said. Read more of this post

Big Tobacco’s Electronic Shock: Lorillard Makes Another Bet on E-Cigarettes With Skycig, and Industry Risks Suggest Such Deals Could Also Be Worthwhile for Altria and Reynolds American

October 2, 2013, 2:56 p.m. ET

Big Tobacco’s Electronic Shock

Lorillard Makes Another Bet on E-Cigarettes With Skycig, and Industry Risks Suggest Such Deals Could Also Be Worthwhile for Altria and Reynolds American

JOHN JANNARONE

Big Tobacco has largely stayed on familiar turf in recent years. Now, it is expanding its horizons. Lorillard, LO +0.60% the No. 3 U.S. tobacco company by market value after Altria Group MO +0.12% and Reynolds American, RAI -0.16% has agreed to pay up to $100 million for Skycig, a U.K.-based maker of electronic cigarettes. That follows a $135 million deal last year to buy blu eCigs, a big U.S. brand. Read more of this post

Is Tesco’s dream of building an international empire unravelling?

Is Tesco’s dream of building an international empire unravelling?

When Sir Terry Leahy took Tesco into the US in 2007, he was driven by the knowledge that the company had seemingly achieved success in international markets as diverse as Poland, Ireland, South Korea and Thailand.

Tesco chief executive Philip Clarke said the company is making progress on improving its performance Photo: Reuters

By Graham Ruddick, Retail Correspondent

11:12AM BST 02 Oct 2013

After Tesco became the biggest food retailer in the UK in 1995, Sir Terry and his management team had set their sights on international domination. The company became a market leader in parts of Asia of Eastern Europe, which prompted Tesco to believe it could prosper in the US with its new Fresh & Easy venture. Read more of this post

To help boost sales of men’s casual wear last month, Lotte Department Shin Heon started to wear jeans to work and encouraged other top officials to do the same

Lotte CEO looking for a little magic

Oct 03,2013

Shin Heon, Lotte Department Store CEO, wearing a navy suit with a red bow tie, entertained 100 or so customers at its department stores in downtown Seoul yesterday with the help of magician Lee Eun-kyul. The show lasted for half an hour. The magic show, presented by the top executive of one of the nation’s leading retailers, was part of a strategy to boost sales as Lotte along with Hyundai Department Store and Shinsegae Department Store, which all started their autumn sales yesterday.  Read more of this post

Samsung’s family feud under way over inheritance

Samsung’s family feud under way over inheritance

Sohn Jae-gwon

2013.10.02 14:25:02

“Late chairman Lee Byung-chul, founder of Samsung Group, did not want the current chairman Lee Kun-hee to inherit the conglomerate singlehandedly. The founder formed a group ‘Seung-ji’ to reach major decisions concerning Samsung Group.” “No. The deceased founder set up the Seung-ji in an effort to allow Lee Kun-hee to have management right overarching other subsidiaries.” The legal dispute between the late founder’s eldest son, Lee Maeng-hee, and Samsung Group is shifting its focus to Seung-ji group and what the founder intended to accomplish with the group. In the second round of a civil appeal case brought to the Seoul High Court Tuesday, lawyers representing Lee Maeng-hee, former chairman of Cheil Fertilizer, said “the late chairman created Seung-ji group to check Lee Kun-hee’s sole inheritance of management right,” unveiling Seung-ji group publicly for the first time. Both Lee Maeng-hee and Samsung Group acknowledge the existence of Seung-ji group. Reportedly, late Samsung founder Lee Byung-chul ordered five figures – then Samsung Group’s chief secretary, chairman Lee Kun-hee, Shinsegae Group chairwoman Lee Myung-hee and Lee Mang-hee’s wife Sohn Bok-nam – to discuss major issues at the ‘Seungji’ meeting. “The existence of ‘Seung-ji’ lies in leading Samsung Group under five leaders, not solely by Lee Kun-hee,” noted a close aid to Lee Mang-hee. However, Samsung noted, “Lee Kun-hee had willingness to succeed the group and other companies including Cheiljedang (currently CJ) whose ownership is transferred to other brothers and sisters should be under the control of Lee Kun-hee as well.”

Korean retailers fostering fashion brands; Homeplus, Korea’s No. 2 supermarket chain run by British retail giant Tesco, first introduced their fashion brand Florence& Fred in 2010

2013-10-02 17:53

Retailers fostering fashion brands

Seen above is the inside of a Florence & Fred store run by the country’s second largest retailer Homeplus. The fashion brand was launched in 2010 in Korea

By Rachel Lee
The country’s major retailers are stepping up efforts to grow their own fashion brands to the level where they can compete with the world’s global SPA brands.
SPA brands are those that produce their own clothing, distribute and sell it exclusively. Names such as H&M, Zara and Uniqlo are classified as SPA brands
According to industry sources, large discount chains including E-Mart and Homeplus have been aiming to do the same with their fashion labels Daiz and Florence& Fred, by launching and expanding the range of high quality products at competitive price. Read more of this post

Criticism mounts of FSS oversight of debt-ridden Tongyang

Criticism mounts of FSS oversight of Tongyang

‘There’s growing doubt over the role of the financial regulator.’

Oct 03,2013

In June, a 47-year-old office worker surnamed Jeong received a call from an employee at Tongyang Securities, the brokerage arm of debt-ridden Tongyang Group. According to Jeong, he was introduced to investing in bonds issued by the conglomerate and was told he would get an annual interest rate of 7 percent, more than three times higher than the market average. Read more of this post

How Prime Focus Broke into Hollywood; Prime Focus started out as a teenager’s garage operation in Mumbai and is now a global force in the post-production of films

How Prime Focus Broke into Hollywood

by Sohini Mitter, Deepak Ajwani | Oct 2, 2013

Prime Focus started out as a teenager’s garage operation in Mumbai and is now a global force in the post-production of films

Namit Malhotra, founder, chairman and CEO of Prime Focus Ltd

The 2011 Academy Awards saw 10 nominations in the VFX (visual effects) category. Of these, five films (including X-Men: First Class, Transformers: Dark of the Moon and The Tree of Life) had engaged an Indian company for 2D-to-3D conversion and post-production work. Prime Focus Limited (PFL), a global visual entertainment services company, has been instrumental in altering the Hollywood perception that only US-based studios excelled in visual effects, 3D and animation. Today, 40 percent of Hollywood’s VFX and 3D work gets done in Asian countries like India, Malaysia, South Korea, Thailand and the Philippines, says a 2013 KPMG report.  Read more of this post

Port Expansion Trimmed as Slowdown Dents Trade: Corporate India

Port Expansion Trimmed as Slowdown Dents Trade: Corporate India

India plans to cut back expansion of a port that helps Ford Motor Co. (F) and Hyundai Motor Co. ship cars after an economic slowdown and rival facilities dented traffic for the first time in seven years. The Chennai Port Trust, which started 128 years ago in the southern Indian city, is hiring a consultant to help review its plans and advise on a reduced capacity, Chairman Atulya Misra said in an e-mail interview. The state-owned operator scrapped a bid this year to build a terminal that would have more than doubled its ability to handle 20-foot standard boxes or TEUs. Read more of this post

India’s dangerous political vacuum

September 30, 2013 6:35 pm

India’s dangerous political vacuum

As elections loom, voters confront a dearth of good options

In times of crisis, people turn to desperate solutions. In India, desperation has a name: Narendra Modi. Mr Modi, once politically crippled by his alleged complicity in the killings of several hundred Muslims in Gujarat, is visibly edging towards the premiership. Business, especially, is turning towards him as a saviour. Read more of this post

Dividend stocks are losing their allure

October 2, 2013 1:28 pm

Dividend stocks are losing their allure

By John Authers

Post-Lehman outperformance has reversed in US since ‘taper talk’ began

For a while, dividend investing paid dividends like never before. And then, five months ago, it stopped. There are ways for investors to take advantage, but they are counter-intuitive. In the post-Lehman years, investors put more weight than ever on the dividend yield they received from equities. In some ways, this was irrational. Under the Miller and Modigliani framework, still taught in business schools, they should have known that dividend yield makes no difference. Cash belongs to the investor whether it stays in the company’s bank account or is paid out in a cheque. If you need income, you can just sell some shares. For many decades, investors took M&M seriously, and yields dwindled. Read more of this post

Silk Road collected 9.5 million bitcoin—and only 11.75 million exist

Silk Road collected 9.5 million bitcoin—and only 11.75 million exist

By Tim Fernholz @timfernholz 9 hours ago

Silk Road, the illicit online marketplace that first brought bitcoin to notoriety in 2011, was shut down today and its alleged founder was arrested. The criminal complaint revealed that the site had collected revenues of some 9.5 million bitcoin since 2011, the equivalent today of $1.2 billion in sales and $80 million in commissions for Ross Ulbricht, who allegedly ran the site under the moniker “Dread Pirate Roberts.” Read more of this post

At $47tn, the gross international investment position of the US is 20 times bigger than Brazil’s, 51 times bigger than India’s. Any movement into and out of US assets is sizeable relative to other and may translate into sharp asset price and exchange rate movements

October 2, 2013 10:03 am

Dollar-based system is inherently unstable

By Ousmène Mandeng

The international economy needs more currencies

The international monetary system does not work as intended. An international economy relying predominantly on one currency is inherently unstable. This is amply demonstrated by the recent turbulence in foreign exchange markets. Over the summer, several emerging markets faced sudden reversals in capital flows. Blaming economic fundamentals to explain such shifts misses the point. There are none sufficiently important. Read more of this post

Malaysia is encouraging Thailand to establish a “rubber city” to develop the key sector in both countries and ensure sustainable prices for farmers

Malaysia urges creation of ‘rubber city’ in deep South

PETCHANET PRATRUANGKRAI
THE NATION October 3, 2013 1:00 am

MALAYSIA is encouraging Thailand to establish a “rubber city” to develop the key sector in both countries and ensure sustainable prices for farmers. Under the proposed project, a city would be created in the border area linking Dan Prakob in Songkhla’s Na Thawee district and Kota Putra in the Malaysian state of Kedah. Malaysia wants Thailand to supply raw materials to support its industries producing items such as rubber gloves and tyres. Read more of this post

Because the results of China’s local government debt audit just can’t come fast enough

Because the results of China’s local government debt audit just can’t come fast enough

David Keohane

| Oct 02 11:15 | 2 comments | Share

SIV/ LGFV/ LGIV/ *shrug*

Whatever you choose to call the vehicles China’s local governments used to fund infrastructure when Beijing restricted financing (we are going with LGFVs here) they are very near the centre of Chinese debt fears. Which means it’d be nice to know how big they really are. From Stephen Green at Standard Chartered (our emphasis): The National Audit Office (NAO) is now carrying out a survey of local government debt. Thousands of officials have been running around the country trying to generate accurate estimates of liabilities at the four levels of local government, down to the township level. At least 10,000 separate legal entities carry this debt burden (some large cities have hundreds of such vehicles), and many have an interest in disguising their liabilities. In addition, a portion of the debt is in the form of inter-company loans and IOUs. The auditors have an extremely challenging task. Read more of this post

Tesla is suddenly the No. 1 car in Norway, where the government is using its oil wealth to smooth the way for battery-powered cars

October 2, 2013, 9:09 a.m. ET

Tesla Sedan Roars Ahead in Norway

Norway Has Relatively Small Market But Buyers Are Affluent

SVEN GRUNDBERG And NICLAS ROLANDER

Tesla Motors Inc.’s TSLA -6.24% Model S is suddenly the No. 1 car in Norway, where the government is using its oil wealth to smooth the way for battery-powered cars. The California company’s electric sedan, the Model S, vaulted to become the best-selling car in Norway in September, just its second month on the market. Tesla captured 5.1% of Norway’s total car sales share during the month. The total number of rechargeable electric cars on the road in Norway is estimated to total 14,500 vehicles. (In all of 2012, auto makers sold just 13,427 electric cars in the larger U.S. market, according to figures compiled by the Electric Drive Transportation Association.) Read more of this post

IPad Prices Jumping 12% on Rupiah Show Indonesia Inflation Risk

IPad Prices Jumping 12% on Rupiah Show Indonesia Inflation Risk

The rupiah’s slump is fueling a surge in Indonesia’s costs of imported goods from iPads to soybeans, spurring Southeast Asia’s fastest inflation and increasing growth risks ahead of elections next year. The cost of iPads jumped 12 percent last month, according to a price list at Indonesia’s leading Apple Inc. (AAPL) retailer iBox. Tofu makers in the world’s fourth-most populous nation went on strike in September as imported soybeans climbed 12 percent this year, according to data from the trade ministry. Read more of this post

Taiwanese banks, once seen as a gateway into China, look more like a trap for private-equity firms including Carlyle as the mainland market proves elusive and competition at home curbs profits for small lenders

Carlyle Among Firms Finding Taiwan Banks No Path to China

Taiwanese banks, once seen as a gateway into China, look more like a trap for private-equity firms including Carlyle Group LP (CG) as the mainland market proves elusive and competition at home curbs profits for small lenders. Cosmos Bank Taiwan (2837), controlled by a buyout firm owned by Steven A. Cohen’s SAC Capital Advisors LLC, has lost 66 percent since the end of 2007, data compiled by Bloomberg show. Taipei-based Ta Chong Bank Ltd. (2847), backed by Carlyle, declined 9.5 percent, while EnTie Commercial Bank, whose owners include Longreach Group Ltd., fell 19 percent in that period. Read more of this post

Asia grain mountains swell as governments fret over food security

Asia grain mountains swell as governments fret over food security

5:12pm EDT

By Naveen Thukral

SINGAPORE (Reuters) – Towering grain mountains in Asia, already large enough to feed China for eight months, are set to grow even bigger as governments persist in shoring up their safety buffers against hard times. Haunted by a 2008 food crisis that sparked unrest and panic buying, states will keep piling grain into reserves despite the strain on their finances and storage problems, buoying prices that have been hit by expectations of bumper harvests. Read more of this post

Southeast Asian Energy Bills Set to Rise as Exports Fall, Oil Imports Soar

Updated October 2, 2013, 3:10 a.m. ET

Southeast Asian Energy Bills Set to Rise as Exports Fall, Oil Imports Soar

International Energy Agency Forecasts Oil Imports Will More Than Double by 2035

ERIC YEP And SIMON HALL

Coal and natural gas exports from Southeast Asia will fall sharply over the next two decades as the region grapples with rapidly growing energy demand, which will increase its dependency on imported oil over the next two decades, the International Energy Agency said Wednesday

Between 2011 and 2035, the 10-nation Association of Southeast Asian Nations could see its energy demand rise by 83%, equivalent to Japan’s present energy consumption. Economic growth, population growth projected at nearly 25% and urbanization will drive demand, the Paris-based agency said in its “Southeast Asia Energy Outlook,” which also urged the governments of the region to increase energy efficiency to help cope with the changes ahead. Read more of this post

Asian companies are raising the largest-sized loans in more than five years as they seek big-ticket deals before a potential rise in lending costs

Fed-Wary Borrowers Grab Jumbo Loans in Asia Before Margins Rise

Asian companies are raising the largest-sized loans in more than five years as they seek big-ticket deals before a potential rise in lending costs. Alibaba Group Holding Ltd. and Origin Energy Ltd. (ORG) syndicated about $15 billion of facilities in the third quarter, leading companies in the Asia-Pacific region outside Japan, according to data compiled by Bloomberg. That boosted the average deal size to $333 million, the highest since the first quarter of 2008. Average margins for dollar-denominated loans fell 22 basis points from a year earlier to 266 basis points on Sept. 30, the data show. Read more of this post

Lego to up its game in Asia over next 20 years

Lego to up its game in Asia over next 20 years

SINGAPORE — Lego has its eyes set on some serious play in Asia, including Singapore, over the next 20 years in an attempt to build on the company’s performance in the region, the Chief Executive of the Danish toy-maker said in an interview yesterday.

BY LEE YEN NEE –

3 HOURS 32 MIN AGO

SINGAPORE — Lego has its eyes set on some serious play in Asia, including Singapore, over the next 20 years in an attempt to build on the company’s performance in the region, the Chief Executive of the Danish toy-maker said in an interview yesterday. Consumer sales in Asia, Lego’s fastest-growing market, have risen 35 per cent in the first half of the year alone, outpacing a 4-per-cent increase in both North and Latin America, and an 8-per-cent growth in Europe during the same period. Read more of this post

Corruption and cover-ups in Leighton Holdings’ international construction empire were rife and known to top company executives and directors, according to internal company files

Building giant Leighton rife with corruption: claims

October 3, 2013

Nick McKenzie and Richard Baker

Bribery scandal engulfs Leighton Holdings

Leighton Holdings is once again facing scrutiny over its business practices following the release of internal documents. Corruption and cover-ups in Leighton Holdings’ international construction empire were rife and known to top company executives and directors, according to internal company files. Those in the know included the Australian construction giant’s chief executive at the time, Wal King, and his short-term successor David Stewart. Read more of this post

Pension Lessons From Down Under; Australians could teach Americans a thing or two about the benefits of reform

October 2, 2013, 12:15 p.m. ET

Pension Lessons From Down Under

Australians could teach Americans a thing or two about the benefits of reform.

America’s municipal finance woes are well known, especially unfunded pension liabilities. For a lesson in how to fix the mess, the Yanks could do worse than get a plane ticket to Australia. That’s the lesson in a recent Moody’s report that shows how Australia’s state governments are reaping the rewards of reforms that began 15 years ago. Starting in the 1990s, they enrolled new employees in defined-contribution plans. As a result, although the old defined-benefit plans still exist for older employees, the states’ unfunded liabilities are smaller and more manageable—something for Americans to envy. Read more of this post

‘Slow frequency’ technology faces tough shift from FX to stock markets

‘Slow frequency’ technology faces tough shift from FX to stock markets

12:38pm EDT

By Eric Onstad

LONDON (Reuters) – Efforts to curb the advantage of high frequency traders – who use computers churning out numerous transactions at lightning speed – face resistance on stock markets, although technology is already starting to level the playing field in currency dealing. Critics of high frequency trading (HFT) say it distorts prices, causes “flash crashes” when markets dive in an instant, and fuels an expensive arms race to shave milliseconds off trading times. Read more of this post