Bamboo Innovator

‘Decoupling’ Returns to Bite Asia

August 1, 2013, 8:57 AM

‘Decoupling’ Returns to Bite Asia

By Michael S. Arnold

A few years ago economists in Asia were talking about “decoupling,” a buzzword that meant markets and economies would continue to grow on the back of regional demand despite a slowdown in the West. Now that decoupling may be coming back to bite them. Manufacturing data out Thursday shows regional economies failing to benefit from a pick-up in economic activity in the U.S., Europe and Japan. The reason? Their deepening dependence on demand in China, where growth continues to decelerate.  Read more of this post

Plight of Chinese hawkers highlights impact of downturn

August 1, 2013 7:45 am

Plight of Chinese hawkers highlights impact of downturn

By Jamil Anderlini in Beijing

Every year the scorching Chinese summer brings throngs of unlicensed vendors out on to the streets, hawking everything from pirated DVDs to watermelons. Given their lowly and illegal status they are often treated poorly by the authorities, but this year has been particularly bloody for this army of mobile shopkeepers. Two weeks ago, Deng Zhengjia, a 56-year-old watermelon vendor, was killed and his wife knocked unconscious after they were attacked by the local “chengguan” – an auxiliary police force tasked with keeping city streets clean and orderly. Since then there have been a dozen similar incidents reported across China in which “melon-peasants” (as they are referred to in Chinese), street hawkers, journalists and even police officers have been beaten up by locally-employed chengguan. Read more of this post

Carrefour in the trenches of the hypermarket war

Carrefour in the trenches of the hypermarket war

1:53am EDT

By Dominique Vidalon

PARIS (Reuters) – Fifty years ago, on June 15, 1963, two French families opened Europe’s first hypermarket in Sainte-Genevieve-des-Bois near Paris. Stocking 5,000 products over 2,500 square meters, it was three times the size of most grocery stores. Today, owned by retail giant Carrefour, it has tripled in size and offers 19,000 different products. The store’s growth mirrors Carrefour’s global expansion, but the format – an out-of-town warehouse offering cheese, lawn mowers and almost everything in between – is shrinking as online vendors, convenience shops and discounters bulk up. Some fear the decline could be terminal. Not Carrefour, which pioneered the stores across the globe, making it the world’s second largest retailer after Wal-Mart, but its attempts to revive the hypermarket in France have ended the tenure of a string of chief executives. Read more of this post

Sin-free ale: Non-alcoholic beer is taking off among Muslim consumers

Sin-free ale: Non-alcoholic beer is taking off among Muslim consumers

Aug 3rd 2013 | BEIRUT AND CAIRO |From the print edition

DEDICATED drinkers may struggle to see the point of non-alcoholic beer, but it is growing in popularity around the world. Last year 2.2 billion litres was downed, 80% more than five years earlier. In the rich world it is mainly consumed by a health-conscious minority. But in the Middle East, which now accounts for almost a third of worldwide sales, the target market is the teetotal majority. In 2012 Iranians quaffed nearly four times as much as in 2007. Consumers in Saudi Arabia, Egypt and the United Arab Emirates also have a growing taste for it (though across the region, alcoholic beer still outsells it). Read more of this post

German employers are abandoning the country’s famous labour model

German industrial relations

Labour’s lost love

German employers are abandoning the country’s famous labour model

Aug 3rd 2013 |From the print edition

IT WORKED brilliantly in the dark days of 2008 and 2009 when exports faltered and companies might have been tempted to shed staff. German manufacturers, their workers and unions, with a little help from the government, engineered a compromise that put employees on short time and trimmed their holiday entitlements but saved their jobs. As a result, when Germany pulled out of recession in 2010 its companies had a skilled workforce in place to meet resurging demand. The pact, along with continuing wage restraint, has boosted productivity while keeping unemployment low. Read more of this post

The future of oil: The world’s thirst for oil could be nearing a peak. That is bad news for producers, excellent for everyone else

The future of oil: The world’s thirst for oil could be nearing a peak. That is bad news for producers, excellent for everyone else

Aug 3rd 2013 |From the print edition

THE dawn of the oil age was fairly recent. Although the stuff was used to waterproof boats in the Middle East 6,000 years ago, extracting it in earnest began only in 1859 after an oil strike in Pennsylvania. The first barrels of crude fetched $18 (around $450 at today’s prices). It was used to make kerosene, the main fuel for artificial lighting after overfishing led to a shortage of whale blubber. Other liquids produced in the refining process, too unstable or smoky for lamplight, were burned or dumped. But the unwanted petrol and diesel did not go to waste for long, thanks to the development of the internal-combustion engine a few years later. Read more of this post

Troubled Currencies, Troubled Regimes

Troubled Currencies, Troubled Regimes

By Steve H. Hanke on 5:04 pm August 1, 2013.
For academics, the term “troubled currency” might be a term of art. But for people who are faced with such a currency, they know a troubled currency when they see one. Today, this is the case for millions of people around the world – most notably in Iran, North Korea, Argentina, Venezuela, Egypt and Syria. A troubled currency is one in which users have lost confidence. When users no longer think a currency will retain its purchasing power, they attempt to dump it for a stable foreign currency (or commodities). As the demand for the troubled currency evaporates, its value vis-a-vis stable foreign currencies collapses, and prices for goods and services sold in the troubled currency soar. As this process develops, expectations about the currency’s ability to retain its purchasing power deteriorate, and a doom loop ensues. At the extreme, doom loops can culminate in hyperinflation – an inflation rate of over 50 percent per month. This, however, is rare. Indeed, there have only been 56 cases of hyperinflation. Read more of this post

Foreign business leaders residing in Korea say that President Park Geun-hye’s corporate policies to ensure “economic democratization” are a move in the right direction to upgrade Asia’s fourth-largest economy

2013-08-01 18:58

Foreigners like Park’s reforms

By Choi Kyong-ae
Foreign business leaders residing in Korea say that President Park Geun-hye’s corporate policies are a move in the right direction to upgrade Asia’s fourth-largest economy. They stress that her economic policies aimed at reforming chaebol and ensuring “economic democratization” will help the country’s economy become more transparent and sustainable. “The government is just enforcing the law and if you look at what the tax office is doing, it’s enforcing the law against big (companies), small (firms) and individuals. But the large companies are more sensational,” Jeffrey Jones, a lawyer at Kim & Chang, told The Korea Times in a telephone interview. Read more of this post

Korean furniture makers finally met the truth of IKEA’s longtime-wearied arrival on their turf

2013-08-01 18:50

IKEA alert: Korean furniture firms brace for dark future

By Ko Dong-hwan
Korean furniture makers finally met the truth of IKEA’s longtime-wearied arrival on their turf. On Aug. 1, Gwangmyeong City approved of an IKEA store construction work on a site of 25,759 square meters located within the KTX Gwangmyeong railway station sphere, which will be completed by late 2014. Korea’s few major furniture companies like Hanssem and Livart responded rather unstirred by the news. As to IKEA’s signature advantage over rival stores _ affordable prices _ they said they will counter with differentiated quality, design, service and wide distribution networks. “Since IKEA’s coming has been confirmed, there is nothing else for us to do but to do our best. We have had two years of preparation since the news of IKEA’s coming to Korea had surfaced.” But for small-to-medium-sized furniture companies, the news totally wrested their hearts. Unlike the major companies, these minor firms _ mostly run by family members or few part time workers _ have few selling points except cheap prices. Lee Sang-bong, president of the Gwangmyeong Furniture Distribution Business Cooperative, said, “For small furniture firms, competing against a global enterprise like IKEA is futile. We might as well hit the road before trying.” Those who are on the same page with Lee have founded a task force that bashes the arrival of IKEA in Gwangmyeong. Their message, targeted at both Gwangmyeong city and IKEA, is to provide mutual measures that don’t kill but instead embrace the small-to-medium-sized companies.

In China, where pirated movies can be bought for less than $1, people are flocking to theaters, a sign of how Chinese consumers are willing to spend more on entertainment.

August 1, 2013, 2:34 p.m. ET

Now Playing: China’s Booming Movie Market

People Are Flocking to Theaters

WEI GU

In China, where pirated movies can be bought for less than $1, people are flocking to theaters, a sign of how Chinese consumers are willing to spend more on entertainment. China, now the world’s second-largest film market after the U.S., is already critical for Hollywood blockbusters such as “Pacific Rim,” a giant monster-versus-robot slamfest that opened in China this week. The movie struggled in the U.S., but its glitzy special effects may be better appreciated in thousands of state-of-the-art movie theatres that have sprung up in China in the past few years. As in other industries, China has taken a “build first, and demand will follow” strategy with movies. And it has worked. The number of screens in China quadrupled from 2009 to 2012, according to entertainment consulting firm EntGroup Inc. Read more of this post

Myanmar Firms Feel Pinch From Abroad; Foreign Consumer-Goods Companies Rush in After Removal of Market Sanctions

August 1, 2013, 2:26 p.m. ET

Myanmar Firms Feel Pinch From Abroad

Foreign Consumer-Goods Companies Rush in After Removal of Market Sanctions

Drinks and other provisions on display at a tea shop in Yangon, Myanmar. Foreign consumer brands like Coca-Cola and Sprite are increasingly displacing locally-produced beverages like Star Cola, chipping away at profits of local conglomerates in the country.

SHIBANI MAHTANI

YANGON, Myanmar—The world’s biggest consumer companies are flocking to Myanmar, filling the once-pariah nation and its backward economy with goods previously unavailable to its 60 million people. But not everyone is happy. Some of the country’s biggest conglomerates—plugging away at the cash-strapped market for decades and fighting hard to grow despite crippling Western sanctions—are now finding themselves drowned out by foreign competitors including Coca-Cola Co. KO +1.22% of the U.S. and Canon Inc.7751.TO +1.78% of Japan. “It is very tough for us, now that these big multinationals are here,” said Sai Sam Htun, chairman of the Loi Hein Group of Cos., one of Myanmar’s largest conglomerates. “They have easily taken over in a short time, because they are so powerful and strong.” Read more of this post

After years of quietly building its craft beer brand in the shadow of MillerCoors, Blue Moon is fighting back against the naysayers

Blue Moon Tells Beer Snobs to Drink Up and Show Respect: Retail

MillerCoors LLC has a message for beer snobs: Blue Moon is an authentic craft brew. So show a little respect.

Aficionados long ago dubbed Blue Moon an impostor cooked up by a megabrewer to exploit the explosive growth of artisanal beer. In recent months, small beermakers have stepped up their attacks — calling suds like Blue Moon “crafty” for not spelling out their corporate parentage. Micro breweries have reason to be defensive: Blue Moon has grabbed what equals 15 percent of the U.S. craft market, expanded as far as Japan and spawned an Anheuser-Busch InBev NV (ABI) knockoff called Shock Top. After years of quietly building its brand in the shadow of MillerCoors, Blue Moon is fighting back against the naysayers. It’s adding more artisanal brews, including a wine hybrid. Marketing emphasizes the beer’s provenance and Belgian-trained brewmaster. Blue Moon is even taking credit for helping to popularize craft. Read more of this post

80 per cent of Beijing’s edible ice cubes from ‘illegal’ factoriesl Only six manufacturers have production license for edible ice in the capital in a market worth $80-130 million

80 per cent of Beijing’s edible ice cubes from ‘illegal’ factories

China Daily/ANN | Thu Aug 1 2013

Only six manufacturers have production license for edible ice in the capital.

China, August 1, 2013

As much as 80 per cent of the edible ice cubes in Beijing’s shops and restaurants come from “illegal” factories, National Business Daily reported. Only six manufacturers have production license for edible ice in the capital, making the total output valued at 100 million yuan (S$20.75 million) in the summer season. But the output of the whole market is valued at 500 to 800 million yuan, which means at least 80 per cent of the ice come from non-qualified factories, the report said. Edible ice companies must have a QS, or Quality Standard identification since 2005. And it costs at least 30,000 yuan to cover the certification besides building laboratories and hiring inspectors, according to an agency for quality certification. Ice cubes at several restaurants were found to be dirtier than toilet water, Chinese media reported last week. According to CCTV, ice cubes used by fast food giants including KFC, McDonald’s and Guangzhou-based Kungfu at their Beijing branches were tested to contain bacteria at severe levels. The KFC ice cubes contained levels of bacteria which were 20 times higher than the national limit, and 13 times higher than water samples taken from toilet bowls. “The market is in chaos,” said an employee of an ice company, “Costs are increasing and those with qualification certificates would have closed down if they didn’t rely on big buyers.”