Posted inAT FinanceBhutanChinaIndiaNorth KoreaNortheast AsiaSouth AsiaSouth KoreaVietnam

The Daily Brief for Monday, 21 August 2017

Hidden political agenda: It is has become clear over the past two months that the border showdown between India and China on a remote plateau in the Himalaya mountains is not really about China building a road in a disputed area, Bertil Lintner writes. When China is involved in a confrontation near or across its frontiers there is always a hidden political agenda. China is attempting to drive a wedge between Bhutan and its traditional ally India, China’s main and traditional geopolitical rival. The sources of China’s frustration with New Delhi include its reluctance to join its One Belt One Road infrastructure development initiative and the long-time presence of the Dalai Lama and his Tibetan government in exile in India.

Show of strength: Amid tensions over North Korea’s missile and nuclear programs, South Korean and US forces began annual military exercises on Monday, Asia Times and Reuters report. Pyongyang views such exercises as preparations for invasion and has fired missiles and taken other actions to coincide with military drills in the past. However, South Korean President Moon Jae-in insists they are purely defensive. “There is no intent at all to heighten military tension on the Korean Peninsula as these drills are held annually and are of a defensive nature,” Moon told cabinet ministers while warning Pyongyang not to engage in provocations.

Chaebol in crosshairs: The head of South Korea’s Fair Trade Commission has told Hyundai Motor Group to dissolve cross-shareholdings in the conglomerate, Soyoung Kim and Hyjunjoo Jin write. Kim Sang-jo said he has been in talks with the autos-to-steel conglomerate about overhauling its complex ownership structure, which critics say gives too much power to its controlling family at the expense of shareholders. “Many people, including me, are telling Hyundai that they shouldn’t waste more time before dissolving cross-shareholding,” said Kim, who has been nicknamed “Chaebol Sniper” for his shareholder activist campaigns targeting South Korea’s powerful family-run conglomerates. “I’m in ongoing conversations with Hyundai.”

Paper weighs in: The censorship in China of hundreds of academic papers from a prominent journal will have little impact because readership is small – and if Western institutions don’t like the way things are done in China they can leave, the state-run Global Times newspaper said in an editorial on Monday, Reuters reports. The editorial appeared after news that Cambridge University Press had blocked access on its site in China to 300 papers and book reviews from the China Quarterly, which the Chinese government had asked to be removed. “Western institutions have the freedom to choose. If they don’t like the Chinese way, they can stop engaging with us,” said the editorial in the Global Times, a nationalistic tabloid.

Vietnam’s energy dilemma: State planners say more than 50% of national power will be coal-fired by 2030, a big boost in the fossil fuel’s use that will worsen the country’s already severe air pollution and undercut its climate change goals, Dan Southerland writes. As a rapidly industrializing nation, it needs more electricity for both industries and homes, requiring it to not only build more coal-fired power plants but also import more of the fuel. Chinese companies appear ready to supply Vietnam with both coal and equipment, even as China closes some of its own coal-fired plants at home.

Asia Times app: Asia Times has launched an app for both iOS- and Android-based devices that will deliver the publication’s regular daily news, commentary, blogs and live coverage while also bringing readers added functionality. Asia Times Staff report that the app, launched on July 25, includes content notification, share and save functions and is free to download from both the Apple Store and Google Play.

Asia Times Financial is now live. Linking accurate news, insightful analysis and local knowledge with the ATF China Bond 50 Index, the world's first benchmark cross sector Chinese Bond Indices. Read ATF now. 

Posted inBeijingChinaGuangzhouShanghaiWorld

China Digest for Monday, 21 August 2017

NEEQ breaks US$749 billion in market value

The National Equities Exchange and Quotation (NEEQ), also known as the “New Third Board,” saw 135 new small and medium-sized enterprises debut in the past week, Xinhua news agency reported. Turnover on the board stood at 2.65 billion yuan (US$397.2 million) last week, a 17.24% decrease from the previous week. Newcomers brought the total number of companies on the board to 11,523, while the total market value amounted to 5 trillion yuan (US$749 billion).

State Council releases FDI ‘category’ guidance

The State Council has issued a guidance on foreign investment for Chinese enterprises, encouraging companies to park their money in areas of infrastructure, capacity and equipment, innovative high technology, energy resources, agriculture and the service industry, the Securities Daily reported. However, investing in real estate and the entertainment industry, as well as buying hotels, cinemas and sports clubs are listed as “limited” categories for overseas investment, which means it needs the approval of regulators beforehand.

PPP model could enhance elderly care

The Finance Ministry and two other administrations have released a guidance on developing the elderly care service industry via the Public-Private Partnership (PPP) model, the Shanghai Securities Daily reported. The guidance encourages companies who own idle factories or other places that are difficult to rent to transform those commercial facilities into elderly care institutions through the PPP framework.

Beijing, Shanghai, Tibet and Qinghai top pensions

Pensions in Beijing, Shanghai, and west China’s Tibet Autonomous Region and Qinghai province exceed 3,000 yuan per month on average, the China News reported. Southwest China’s Sichuan province claimed the bottom of the list with an average pension below 2,000 yuan per month. The annual rate of increase for pensions stood at 10%, 6.5% and 5.5% from 2015 to 2017 respectively, reflecting the rate of economic growth.

China United opens door to private investors

China United Network Communications Limited, the A-share listed subordinate to China Unicom, disclosed details of a plan to introduce private investors to its mixed-ownership reform, the Paper reported. The company hopes to raise 61.73 billion yuan via strategic investors with around 9 billion shares, after which China Unicom will hold 36.67% of the company.

Wanda Group to invest in new tourism projects

Dalian Wanda, a Chinese multinational conglomerate corporation, has revealed it will invest in Lanzhou city, Gansu province, to create a large cultural tourist destination. It will also choose other cities in the province to set up ten new Wanda Plazas, a complex comprised of shopping malls, hotels, restaurants, entertainment and apartments, said Wang Jianlin, founder and CEO of the group, Caixin reported. Previously, the company sold 13 cultural and tourism projects to Sunac in July.

Alibaba plans new HQ in west China

Alibaba will set up its north-west headquarters in Xi’an city, Shaanxi province, in an effort to better support the One Belt One Road initiative and western regional development, said Jack Ma, the founder and chairman of the company, the Xinhua News agency reported. The company has landed considerable business interests in the city, including logistics, e-commerce and internet finance. Meanwhile, its cloud computing arm, Alibaba Cloud, will cooperate with Xi’an Jiaotong University to set up a new data college. Its fin-tech affiliate, Ant Financial, will also work with the municipal government to promote Xi’an as a “mobile smart city.”

ETC system hits 50-million user mark

The number of expressway Electronic Toll Collection (ETC) system users has broken through 50 million, while more than 98% of traffic lanes are equipped with the system, the Shanghai Securities Journal reported. People can use the expressway without having to stop at toll booths via the high-tech collection system and it is expected to gain a 50% usage rate by 2020.

Seven high-speed trains to become world’s fastest

Seven “Fuxing Hao” Beijing-Shanghai high-speed trains will operate at a speed of 350 kilometres per hour – the fastest in the world – starting September 21, Caixin reported. The journey between the two cities is expected to be shortened by half an hour to about four and a half hours. The Beijing-Shanghai high-speed rail link, which cost 220.9 billion yuan to build, is designed to run at a speed of 380 kilometres per hour.

Shanghai halts bike-sharing expansion

Shanghai has suspended any increase in bike-sharing, following similar decisions made in Hangzhou, Guangzhou and Nanjing, Xinhua Finance reported. The Shanghai Municipal Transportation Commission said that sharing bikes have rapidly increased in the city, to the point where they are having a negative impact on traffic and the city’s image. The number of sharing bikes in Shanghai now amounts to more than 1.5 million, the report said.

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