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The Daily Brief for Friday, 25 August 2017

Cambodia clamps down: Prime Minister Hun Sen’s government has entered a new phase of repression, one that has targeted foreign governmental and nongovernmental organizations and media ahead of crucial elections scheduled for next year, David Hutt writes. The expulsion of the National Democratic Institute and an apparent attempt to shut down the Cambodian Daily mirrors anti-democratic tactics used by other global authoritarian regimes. While authorities have persistently pestered civil society groups Hun Sen and his ruling Cambodian People’s Party have frequently labeled as loyal tools of the political opposition, the current campaign threatens to permanently uproot some of the country’s most prominent and long-standing pro-democracy and checking and balancing organizations.

Trump-Moscow collusion hysteria: If Trump is a stooge of Putin, why is it that Russia’s economy has tanked? And why is it that anti-Moscow Poland has been one of the best economic performers in Europe? Jerry Bowyer and Charles Bowyer ask. On Tuesday, the US government imposed sanctions on Russian individuals accused of exporting oil to North Korea. The same day, the US State Department blamed Russia for supporting the Taliban in Afghanistan. This has escalated tensions between Russia and the United States, severely undermining the theory that Donald Trump is acting in Vladimir Putin’s interests.

Russian transport infrastructure: Moscow has approved US$2.5 billion to expand and modernize the Trans-Siberian and Baikal-Amur railways as part of a larger rail project to boost economic growth and exports from the country’s Far East region that borders the Pacific Ocean, Asia Times staff report. It will pay for 580 kilometers of additional main lines, signaling upgrades on 680 km of railway and 43 crossings, and the renovation of 90 railway stations. Russian Railways said in a statement on its website: “The project will contribute to the development of industrial enterprises in the region, create new jobs, and the necessary economic conditions for effective and sustainable development of Siberia and the Far East.”

Timely economic lessons: Masayoshi Son’s multibillion dollar investments in chipmaker Nvidia to Chinese Uber rival Didi Chuxing are all so, well, un-Japanese, William Pesek writes. After decades of debt crises, deflation and lost competitiveness, Japan Inc found caution to be a virtue. Son, who founded SoftBank, is going the other way, offering timely lessons for Asia’s No 2 economy. For the first time in 30 years, venture capitalists in the US and Europe are baffled by the scale, frequency and diversity of investments coming out of Japan.

Auto merger eyed: Fiat Chrysler Automobiles (FCA) chairman and chief executive Sergio Marchionne is setting his sights on a merger with South Korean automotive giant Hyundai Motor Group while at the same time seemingly using China’s Great Wall Motor Co as a stalking horse, PK Semler writes. Sources close to the situation say Italian-Canadian Marchionne began planting rumors of possible Chinese interest in FCA in June after being rebuffed first by General Motors CEO Mary Barra and later by troubled Wolfsburg, Germany-based Volkswagen Group.

Asia Times app: Asia Times has launched an app for both iOS- and Android-based devices that delivers the publication’s regular daily news, commentary, blogs and live coverage while also bringing readers added functionality. As we report here, 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.

Posted inChinaShanghaiWorldWuhan

China Digest for Friday, 25 August 2017

ICBC head says ‘super balance sheet’ needed

The chairman of the Industrial and Commercial Bank of China (ICBC), Yi Huiman, said on Thursday that a “super balance sheet” is required in order to tackle the current issues in China’s financial sector, Caixin reported. The balance sheet would include assets and liabilities on and off-balance sheet, overseas and domestic, deposits and money supply and short-term and long-term capital flow, the report said. Yi said that current oversights of M2 money supply, deposits and loans are insufficient for the health of the financial system.

China to boost online information consumption

China said it will boost online information consumption in the next few years to help promote innovation, drive domestic demand and stimulate economic growth, the Securities Times reported. The consumption of online information products and services is expected to increase 11% annually to reach 6 trillion yuan (US$900 billion) by 2020. China will foster online progress by encouraging intelligent electronics, education and medical treatment, e-commerce, 5G mobile networks, and telecom services in rural areas.

China Life’s profits rise as crackdown continues

China Life, the country’s largest life insurer, posted an interim profit of 12.24 billion yuan in the first half of 2017, a 17.8% year-on-year increase, as regulatory officials cracked down on its smaller rivals, Caixin reported. The total revenue amounted to 345.97 billion yuan, increasing 18.3% yearly in this period. The company’s service structure also changed, as the bond and fixed-term deposit sector decreased and stock and fund services increased.

Baosteel Group reports US$930.86 million profit

Baosteel Group, one of China’s largest steelmakers, reported a 64.91% jump in net profit year on year for the first half of 2017, clocking in at 6.17 billion yuan (US$930.86 million), the Paper reported. The report is the first financial statement following the acquisition of another state-owned enterprise steelmaker, Wuhan Iron and Steel, earlier this year. Baosteel says that “supply side reforms” and a change in operating environment have contributed to the good performance.

China Vanke reports first-half surge

China Vanke, the country’s second largest property developer by sales, posted a 41.7% year-on-year rise to reach 10.05 billion yuan in first-half net profit, the Paper reported. The company reported an 37.93% year-on-year increase of overall profit to 13.6 billion yuan while revenue dropped 6.66% to 69.8 billion yuan, due to fewer completed projects. Total sales amounted to 277.18 billion yuan, a 45.8% annual increase.

Citi Bank sees shrunken mid-year balance sheet

Total assets of China Citi Bank Corp Ltd stood at 5.65 trillion yuan by the end of June, a 4.72% decrease compared to the end of last year, while its liabilities were 5.26 trillion yuan, a 5.19% slid, the Paper reported. Its net profit amounted to 24.01 billion yuan, a 1.74% year-on-year increase. The value of non-performing loans increased 5.23% compared to last year’s figure to 51.12 billion yuan, while its ratio decreased 0.04 percentage points to 1.65%.

Shanghai Futures Exchange acts to control speculators

The Shanghai Futures Exchange said on Thursday that transaction fees for the futures of two hot-rolled steel coiled products, HC1710 and HC1801, will be tweaked upwards of five times in order to curb speculation, the Paper reported. The exchange had earlier imposed limits on other ferrous metals futures, such as coking coal, more than three times this month, the report added, all in a bid to curb speculation.

PetroChina says no change of strategy in North America

The vice-chairman of the nation’s biggest oil producer, Wang Dong, said on Thursday that PetroChina has made no changes in strategy regarding the North American market, amid rumors of a staff exodus at its North American offices, Caixin reported. Wang also said that the company did not see any “abnormal change” in staff turnover at its North American offices and said its overall strategy in the area remains unchanged, the report added.

Huawei leads top 500 private enterprises

Huawei Investment & Holding leads the top 500 private enterprise list with revenue of 521.57 billion yuan in 2016, Sina Finance reported. The Shenzhen-based Huawei was followed by Suning Holdings Group Co, a Nanjing-based home appliance retailer, with annual earnings of 412.95 billion yuan. Six private companies achieved revenue of more than 300 billion yuan each and only 20 private enterprises were on the 2017 Fortune Global 500 list out of a total of 115 Chinese companies.