Thursday, 30 June 2011


China Daily 3


Liao Qun

China Daily, June 30, 2011

Concerns about a hard landing in China's economy have arisen recently, weighing on sentiment in the Hong Kong stock market.

Professor Noureil Roubini of New York University made just such a blatant prediction on June 11, citing the accumulation of non-performing loans and serious overcapacity on the mainland.

Meanwhile, investment guru George Soros argued that China has lost the opportunity to contain inflation and faces the risk of an economic hard landing.

Are such concerns justified?

Indeed, economic growth in China has slowed down this year, with GDP growing by 9.7 percent (all percentages in a year-on-year basis unless indicated otherwise) in the first quarter, 0.5 percent and 0.1 percent lower than that of 2010 and the fourth quarter of 2010, respectively. Furthermore, growth in value-added industrial production moderated to 13.4 percent in April and 13.3 percent in May from the first quarter's 14.4 percent, indicating a further slowdown in economic growth in the second quarter.

However, this is what was intended and expected by the central government with its monetary tightening policy. The economy recovered strongly with 9.1 percent growth in 2009, and extended the rally by 10.3 percent in 2010, pushing up inflation and raising concerns about overheating again. Against this backdrop, the central government raised the curtain for a new round of monetary tightening by hiking interest rates in mid-October 2010. Since then there have been four interest rates hikes with the one-year lending rate increased from 5.25 percent to 6.25 percent, and nine reserve requirement ratio (RRR) rises with the RRR for large-sized banks up from 17.0 percent to 21.5 percent and for small to medium-sized banks raised from 13.5 percent to 18.0 percent. Meanwhile, the People's Bank of China (PBoC) performed open market operations in the money market and conducted the so-called window guidance to commercial banks frequently. The economic slowdown is thus a direct result of such monetary tightening, and represents a healthy economic adjustment for both the government and the market.

(...) [artículo aquí]

Wednesday, 29 June 2011




Sophie Leung and Richard Frost

Bloomberg, Jun 29, 2011

Hong Kong’s widening wealth gap, with home prices soaring 70 percent since the start of 2009, may prompt an increased turnout in annual protests this week as the territory’s leader suffers his lowest poll ratings yet.

Chief Executive Donald Tsang’s failure to tackle Asia’s biggest rich-poor divide has seen his support drop to a score of 46.5 in a survey of 1,000 residents taken during the week to June 8, the worst since he took office in 2005, the University of Hong Kong’s Public Opinion Programme shows. Respondents were asked to rate him on a scale from 0 to 100.

“People think Donald Tsang favors the interests of big business, and this is the reason behind his apparent refusal to resolve the housing issue or narrow the wealth gap,” said Joseph Cheng, a political science professor at City University of Hong Kong.

“Dissatisfaction against the government is certainly rising, and we will probably see more protests,” including at a July 1 rally commemorating the U.K. handover of Hong Kong to China, he said.

Tsang’s unpopularity parallels trends across Asia, where economic development, inflation and rising asset prices have deepened discontent among lower-skilled workers. Singapore’s ruling party saw record support for the opposition in elections last month, and China has arrested local officials in the aftermath of protests over abuse of power as inequality grows.

(...) [artículo aquí]

Tuesday, 28 June 2011


El Pais logo def


Timothy Garton Ash

El País, 28 de junio de 2011

En otros tiempos, Europa colonizaba pedazos de China. Hoy, China coloniza pedazos de Europa. De manera informal, por supuesto, y mucho más cortés que cuando la situación era al revés. El ascenso de China esclarece y al tiempo aprovecha el declive relativo de Europa.

El primer ministro chino, Wen Jiabao, que llegó a Europa el día 24, tenía previsto visitar Alemania, Reino Unido y Hungría. ¿Por qué Hungría? En parte, porque ocupa la presidencia de turno de la UE, pero también porque China dispone de grandes inversiones en el país y pretende hacer más, como en otros lugares del sur y el sureste de Europa. Un estudio que van a publicar Francois Godement y Jonas Parello-Plesner, del Consejo Europeo de Relaciones Exteriores (ECFR en sus siglas en inglés), calcula que China hoy tiene el 40% de sus inversiones de la UE en Portugal, España, Italia, Grecia y Europa del Este. El último año, varias autoridades chinas han visitado asimismo España, Portugal y Grecia.

¿Por qué prestar tanta atención a la periferia? Porque en esos países se pueden hacer inversiones prometedoras, y esas economías periféricas, más pequeñas, son una forma sencilla de entrar en un mercado europeo único de 500 millones de consumidores. El mercado de la UE está mucho más abierto a los inversores chinos que el chino a los europeos. Además, hacer grandes inversiones en estos países tiene una compensación política. Cuanto más dependan económicamente de China, menos probabilidades habrá de que apoyen las acciones comunes de la UE que China considera hostiles a sus intereses fundamentales. No es demasiado cínico darse cuenta de que Pekín está construyendo una especie de lobby chino dentro de las estructuras de toma de decisiones de la UE, donde, al menos en teoría, el Estado más pequeño es igual que el más grande.

Con la eurozona en cuidados intensivos, a países como Grecia, España y Portugal también les gustaría que China comprase parte de sus desolados bonos del Estado. Aunque no conocemos las cifras exactas de las adquisiciones de bonos por parte de China, sí sabemos que los gestores chinos de fondos soberanos llevan un tiempo diversificando discretamente sus inversiones para no limitarse a los bonos del Tesoro estadounidense. Sus dirigentes políticos pronuncian palabras comprensivas y hablan de ayudar a la eurozona. La verdad es que a la economía china le perjudicaría que la economía europea cayese en picado.

(...) [artículo aquí]

Monday, 27 June 2011


Economic Times logo OK


Chetan Ahya

The Economic Times, June 27, 2011

After the credit crisis , India (like many other developed and emerging economies) resorted to fiscal and monetary stimulus to push growth back to pre-crisis trend immediately. This was a justified policy action at the worst point of the crisis, but we believe the policy-makers overstayed the course.

The government maintained high expenditure growth (a large part of it tends to be revenue spending in nature) and the Reserve Bank of India ( RBI )) also left real policy rates in negative territory for a long period. While this easy approach did boost growth strongly, the low productivity dynamic accompanying it meant that the country faced challenges of inflation, current account deficit and tight inter-bank liquidity.

The most challenging symptom for the policy-makers has been inflation. Indeed, we believe that a large part of the food inflation is because of this low productivity dynamic of government spending in the rural India and less due to structural shift in protein consumption.

Structural shift cannot justify a cumulative rise of 55% in primary food inflation since January 2008.

However, a policy-induced growth slowdown now appears inevitable. A combination of factors - including persistent high inflation rate, higher oil prices, sharp rise in interest rates, and a weak global capital market environment - is likely to result in slowdown in growth. We have already cut our FY 2012 (year-end March 2012) GDP growth forecast to 7.7% and have highlighted further potential downside risks to GDP growth of about 50 bps.

(...) [artículo aquí]

Sunday, 26 June 2011


The Telegraph DEF


It is in the interest of cash-rich China to help resolve the eurozone debt crisis, but Chinese premier Wen Jiabao, who is visiting Britain and Continental Europe, will want a share of the West’s buying power in return.

Malcolm Moore, Peter Foster and Andrew Cave

The Telegraph, June 26, 2011

As Wen Jiabao, the Chinese premier, stepped off his plane in Birmingham on Saturday, it was difficult to avoid the feeling that the UK, and Europe, have never looked weaker in Chinese eyes.

In private, senior Chinese diplomats are now openly scornful of Britain’s economic prospects and have even asked why Mr Wen should grace such a weak trading partner with three days of his time.

Indeed, it is telling that the first stop on Mr Wen’s tour is Longbridge, the old MG Rover car factory that passed into Chinese hands in 2005. Once a byword for poor productivity, wildcat strikes and trade union power in its British Leyland and Austin Rover days, the plant is now host to China’s biggest industrial presence in the UK. Owned by Shanghai Automobile Industry Corporation, the factory designs and assembles MG cars in the UK made from car parts manufactured in China.

However, the Longbridge site remains the only major example of Sino-British co-operation, something that the Prime Minister, David Cameron, whose advisers have helped co-ordinate the visit, is determined to change.

(...) [artículo aquí]

Saturday, 25 June 2011


Eurasia Review


Rida Zeenat

Eurasia Review, June 25, 2011

India and Pakistan since 1947 have been involved in hostile relationship because of various ideological, historical and territorial differences. The three major wars before nuclearization is a clear example of their rivalry. However post nuclearization both the states came at the brink of war but the conflict did not escalate, as both the states were rational enough to calculate the costs and benefits of a nuclear war.

Strategic stability in South Asian region is under challenge and the region in peril because of various threats and external factors. These include, the Indian hegemonic posture and its aggressive nature towards Pakistan, the point of reference here is to the Indian military’s Cold Start Doctrine, U.S. long-lived engagement in the region, particularly, in Afghanistan, Western discriminatory approaches to the region like Indo-U.S. Nuclear Deal and efforts to accommodate India into the international non-proliferation regimes namely Nuclear Supplier Group (NSG), Australia Group (AG), Wassenaar Arrangment (WA) and Missile Technology Control Regime (MTCR) making India technology enabler state, removal of ISRO and DRDO from entity list which would further enhance India’s space and defence capabilities whereas Pakistan has been deliberately denied access to global technology market.

(...) [artículo aquí]

Friday, 24 June 2011


China Daily 3


Fraser Cameron

China Daily, June 24, 2011

Normally, the visit of Premier Wen Jiabao to Europe would catch the headlines. But as Wen Jiabao starts his visit to Hungary, the United Kingdom and Germany on Friday, all eyes will be focused on Europe's seemingly never-ending euro crisis. European leaders are holding a meeting in Brussels on Thursday and Friday, and the debt crisis is the top item on the agenda. 

The immediate crisis facing Greece has been averted, though, with European finance ministers agreeing to a new bailout package this week. 

At a media briefing before the premier's visit, Vice-Foreign Minister Fu Ying said that China had tried to help the European Union (EU) overcome its troubles by buying more European debt and encouraging bilateral trade, and that the future of the European economy was "vitally important" for China. China had not reduced its considerable reserve holdings of euros, she said. On the contrary, it has continued to buy the bonds of countries at the center of the crisis such as Greece, Portugal and Spain. 

Analysts say Chinese support has been important in stemming the depreciation of the euro. Today, it is just 5 percent below its peak against the US dollar, although many European companies would prefer to have a lower exchange rate. Support for the euro will help China in its twin track policy of increasing the international role of the yuan and allowing a gradual appreciation of its currency. 

(...) [artículo aquí]

Wednesday, 22 June 2011




Zhang Junsai

The Globe and Mail, June 23, 2011

At last Friday’s Munk Debate in Toronto, Henry Kissinger and three other global affairs experts heatedly debated whether the 21st century belongs to China. What is China’s status quo? Does China have a bright future? These questions were at the heart of the debate.

Former Chinese leader Deng Xiaoping once said that China is both “big and small, strong and weak.” His wise words, which echoed China’s complexity, still ring true today.

Sixty-two years since its founding, and 30 years since economic reforms began, the People’s Republic of China has awed the world with its stunning economic and social progress: More than 200 million Chinese were lifted out of poverty. More than a billion now have enough to eat. Our GDP totalled $5.88-trillion (U.S.) in 2010, making us the world’s second-largest economy. We top the world in the number of cars produced and sold. Our highway network has expanded to more than 65,000 kilometres. Our high-speed rail construction is growing rapidly. And many Chinese people earn a decent living from hard work.

But we still face a number of economic and social challenges with a population of 1.3 billion people. Any trivial problem would be big when multiplied by 1.3 billion, and enormous wealth would look insignificant when divided by 1.3 billion. Our GDP per capita is about $4,000, less than a 10th of that of Canada. Based on United Nations standards, 150 million Chinese – nearly five times Canada’s population – still live in poverty on less than a dollar a day.

China’s foundation for economic growth is fragile. Our economic mix needs to be improved. Development is unbalanced between eastern and western China, between rural areas and cities. The rich are leaving the poor far behind. We are under growing pressure on medical care, education and housing. The road to better social welfare will be long and hard. And China’s aging population is expanding faster than those of developed countries. Our modernization has a long way to go, and building social harmony will not be easy.

(...) [artículo aquí]

Tuesday, 21 June 2011




Edward Hugh

Seeking Alpha, June 21, 2011

As the European Central Bank moves steadily and earnestly forward with its ongoing rate hike cycle -- sending one fragile economy after another along Europe's periphery drifting off towards recession -- there is at least one prominent global central banker who must be feeling vindicated in the policy stance he has taken to try and bring the rampant inflation from which his country has been suffering back under control.

Duvvuri Subbarao is governor of the Reserve Bank of India, and under his stewardship the central bank has been hard at work over the last 12 months trying to credibly fight inflation. So far rates have been raised 10 times, and the bank has managed to claw the annual rate of wholesale price inflation back from its peak of 10.9% to the current level of 9.06%. Hardly a level to be complacent about, but then Subarrao seems far from complacent.

(...) [artículo aquí]

Monday, 20 June 2011




The Economic Times, June 20, 2011

In the past couple of weeks, market participants have talked about the 'hard landing' risks to the Chinese economy . However, a recent report by Deutsche Bank points out that most of these risks may be short-term in nature and manageable. Here's what it says about these factors.

Power shortage: Its impact on annual GDP will be less than 0.3%. The recent tariff hikes have already reduced the percentage of loss making IPPs to an estimated 20% from 40%. Another 3% rise in tariffs, which is likely, would turn most IPPs to profitable operation.

Weak manufacturing PMI: The manufacturing PMI fell to a 15-month low of 52 in May. However, the non-manufacturing (services) PMI remained at a robust 61.9. As the services sector now accounts for 43% of GDP vs 47% for the industrial sector, the weighted average PMI, remains substantially higher than the historical average. This means that despite some short-term weakness in industrial production growth, the deceleration of the overall GDP should be mild in Q2 and Q3. The reasons for current weakness are short term and manufacturing will recover from September.

(...) [artículo aquí]

Sunday, 19 June 2011




La segunda economía mundial se resiente del terremoto y de una deuda crónica que supera el 200% de su PIB

Fernando Cano

El País (Negocios), 18 de junio de 2011

Japón ha entrado de nuevo en recesión después de que su PIB retrocediese un 3,5% en términos anualizados entre enero y marzo. En el último trimestre de 2010, el retroceso ya había sido del 3%. La caída en el primer trimestre, que se explica en parte por el terremoto y posterior tsunami del 11 de marzo, llega en el peor momento para la economía nipona. Japón se encuentra asfixiado por una abultada deuda pública y por la necesidad de volver a crecer para aumentar sus ingresos y controlar un déficit fiscal que ya se ha convertido en crónico.

La factura del terremoto -que ni incluye el total de los costes derivados de la crisis nuclear en Fukushima- sería de unos 300.000 millones de dólares. Una cifra que aumenta si se considera la paralización de las industrias de parte importante del país, la interrupción -que todavía se mantiene en algunas zonas- del suministro de energía y la abrupta caída de las exportaciones. Este cuadro ha provocado que el FMI haya rebajado sus previsiones de crecimiento para este año de un crecimiento del 1,4% a una caída del 0,7%.

No obstante, los problemas más urgentes de Japón vienen del lado de la deuda. El último recuento indica que la deuda bruta del Estado supera el 210% del PIB, mientras que la deuda neta [que excluye las reservas y divisas estatales] se dispara hasta el 115%. Estos datos son los más elevados de los países que tienen clasificación internacional de deuda. Lo más preocupante es que la OCDE prevé que al cierre de 2012 la deuda de Japón se eleve al 218,7% del PIB.

(...) [artículo aquí]

Saturday, 18 June 2011



Thoughts on what led to India recently being ranked as the fourth-worst place in the world to be female

Doug Saunders

The Globe and Mail, June 18, 2011

My mother began her career as a high-school teacher in a country that regarded women as the property of men. She could not get a bank account or a credit card of her own, only one bearing my father's name - and only with his permission and under his control. Most jobs were open only to men. Only a quarter of drivers were women, and the whole phenomenon of women driving was hotly debated in the media.

That was Canada in the 1960s. I kept that in mind on Friday as I watched the ebullient spectacle of dozens of Saudi Arabian women daring to defy their country's laws by getting into cars and driving. You might think their humble rebellion is doomed to failure. But we forget how fast things can change, and how suddenly that change can begin.

We tend to think of the gross mistreatment of women as a matter of deeply rooted tradition and custom: Some places are just like that. Religion and culture are timeless, we like to believe. Sexual equality, then, is pointless: It would be an utterly alien import.

(...) [artículo aquí]

Friday, 17 June 2011


Bloomber - BWok


Bloomberg News

Bloomberg Business Week, June 17, 2011

At the Haiyang Zhuangshi Co. hardware store in Beijing, sales of paint and aluminum window frames are slowing, one sign of a diminished role for consumer spending in China that’s foiling government objectives.

“It seems the peak days are gone,” said owner Hu Mengbin, 42, whose daily revenue has dropped to about 3,000 yuan ($463) from as much as 4,000 yuan last year after China stepped up efforts to rein in home prices. “Between 2006 and 2008 when the property market was red hot, we could make quick money.”

Hu’s loss underlines the dilemma for Premier Wen Jiabao: his campaign to control inflation is undermining attempts to make consumers a bigger driver of the world’s second-largest economy. Failure to lessen dependence on exports and investment spending leaves the nation more vulnerable to swings in external demand and subject to asset booms and busts.

Government data this week showed retail sales growth slowed to 16.9 percent in May, less than the average of the past five years and a figure that’s inflated by soaring prices for food. By contrast, spending on fixed assets such as factories and property climbed 26 percent, excluding rural households, in the first five months, the fastest pace in almost a year.

(...) [artículo aquí]

Thursday, 16 June 2011


El Pais logo def


Pekín reconoce que la lluvia ácida afecta a más de la mitad de las ciudades chinas, y la contaminación a la sexta parte de los grandes ríos del país

José Reinoso

El País, 16 de junio de 2011

China experimentó en 2007 más de 80.000 "incidentes de masas", 20.000 más que el año anterior. Incidentes de masas es el eufemismo que utiliza el Gobierno para designar protestas, huelgas, manifestaciones y otras movilizaciones por motivos que van desde las expropiaciones ilegales de suelo a reclamaciones de salarios impagados y denuncias de corrupción o abusos de poder. Desde entonces, no han sido publicadas nuevas cifras sobre lo que los analistas consideran el creciente número de protestas que ha llevado emparejado el rápido y desigual crecimiento económico del país.

Muchas de estas movilizaciones tienen su origen en escándalos de contaminación ambiental, en particular la causada por los metales pesados y los vertidos de las fábricas. Son la punta del iceberg del precio que ha pagado el país asiático desde que Deng Xiaoping inició el proceso de apertura y reforma hace tres décadas, con una máxima en el zurrón: "Hacerse rico es glorioso".

El Gobierno puso cifras a este precio medioambiental la semana pasada: más de la mitad de las ciudades chinas están afectadas por la lluvia ácida y una sexta parte de los principales ríos están tan contaminados que su agua no es apropiada ni para el cultivo. "La situación medioambiental en su conjunto es aún muy grave y se enfrenta a muchas dificultades y desafíos", aseguró Li Ganjie, viceministro de Medio Ambiente, informa Reuters.

La degradación que ha acompañado al desarrollo chino es uno de los fracasos de un modelo considerado de éxito porque ha permitido sacar de la pobreza a cientos de millones de personas y ha situado a China como la segunda economía de mundo, tras Estados Unidos.

Las aguas de ciudades estrellas como Shanghái, Guangzhou (Cantón) y Tianjin están clasificadas como gravemente contaminadas, y solo algunas zonas alrededor de la turística isla de Hainan, en el sur, y parte de la costa del norte están totalmente limpias. Únicamente el 3,6% de las 471 ciudades controladas registran un aire del máximo nivel de limpieza, afirmó Li, quien añadió que China continúa perdiendo biodiversidad. El político insistió en que la contaminación, en especial la debida a metales pesados, es "un asunto grave" porque, según dijo, "no solo afecta seriamente a la salud de la gente, sino a la estabilidad social".

(...) [artículo aquí]

Wednesday, 15 June 2011




China has put on a display of force to quell recent violent bouts of unrest.


AsiaOne, June 15, 2011

BEIJING, China - China has put on a display of force to quell recent violent bouts of unrest - events that analysts say highlight resentment towards an unresponsive government grappling with economic and social strife.

Protests against local authorities have erupted over everything from social injustices to ethnic tensions, compounding the jitters of a stability-obsessed government already wary about inflation's potential to spark Arab-style unrest.

"There are so many social groups that have become angry. There's a general feeling of tension between the government and people," said Zheng Yongnian, director of the National University of Singapore's East Asian Institute.

For more than 30 years, communist China has focused on growth, lifting millions out of poverty and becoming the world's second-largest economy in the process.

But analysts say social and political reforms have not followed suit, sparking a litany of problems such as corruption, government abuses, illegal land seizures, a growing rich-poor divide and pollution.

(...) [artículo aquí]

Tuesday, 14 June 2011




Kelvin Wong, Nichola Saminather and Hui-yong Yu

Bloomberg, June 14, 2011

On a sunny Saturday in early June, Larry Zhou strolled the floor of a property exhibition in Hong Kong, wondering whether it was time to buy another home -- not in the city, where residential prices have soared 50 percent in the past two years, but maybe in Thailand or Malaysia.

“My wife and I have been thinking about investing outside of the country since we already own an apartment in Shanghai,” Zhou, a 38-year-old civil engineer, said in an interview at the Hong Kong Convention & Exhibition Centre before wrapping up a business trip and returning home. “I’ve known people in Shanghai who like to bring their money and invest in Hong Kong properties, but I think Hong Kong is way too expensive.”

The two-day event that lured Zhou and 3,000 others is one way that China’s blossoming wealthy and middle classes are finding investment properties and second homes around the world -- exporting a real estate boom that has driven up prices 26 percent in Shanghai last year and 28 percent in Beijing, and bolstering markets around the world. In cities with established Chinese populations, like Sydney, Singapore, and San Francisco, Asians on homebuying tours meet brokers such as Betty Chan, who markets herself on her website as “Las Vegas’ #1 Chinese Lady Real Estate Broker.”

(...) [artículo aquí]

Sunday, 12 June 2011


El Pais logo def


Las malas noticias sacuden a la tercera economía del mundo. La fusión del núcleo de Fukushima fue peor de lo anunciado y el primer ministro está a punto de dimitir

Rafael Méndez

El País (Domingo), 12 de junio de 2011

Japón ha demostrado de sobra su capacidad para levantarse de la lona. Como Sísifo, obligado a empujar una enorme piedra cuesta arriba por una ladera empinada que siempre terminaba por rodar hacia abajo, el país encara su enésima reconstrucción. Pero lo hace cada vez con menos fuerzas y ante obstáculos crecientes.

El tsunami del pasado 11 de marzo dejó el paisaje de una guerra a lo largo de cientos de kilómetros en la costa noreste. Casi dos meses después del terremoto de magnitud nueve los pueblos costeros seguían arrasados. Bastaba recorrer la cuarteada carretera de la costa -Ishinomaki, Onagawa, Urashuku...- para atravesar la desolación: ciudades destruidas como si hubieran sido bombardeadas, edificios reducidos a cimientos, barcos en los tejados, coches desplazados cientos de metros, incluso kilómetros... Algunos militares con mascarilla revolvían sin mucha fe los escombros mientras vecinos aquí y allá rebuscaban entre sus cosas en busca de algo que salvar (lo más valioso en esos casos eran los álbumes de fotos).

El tsunami se encajonó en las rías de la costa y alcanzó en algunos puntos los 30 metros de altura, como un edificio de 10 plantas. Se llevó pueblos enteros. Hay unos 15.000 muertos y otros tantos desaparecidos, 10 veces menos que en el maremoto de Indonesia, en 2004. El sistema de alerta de Japón (casi todas las compañías de móviles lanzan mensajes de texto con el aviso a veces solo medio segundo antes del temblor) evitó una tragedia aún mayor.

Pero tres meses después del terremoto, miles de personas siguen en albergues y el primer ministro, Naoto Kan, tiene los días contados en el puesto. Japón, el país más endeudado del planeta (su deuda asciende a más del doble del producto interior bruto) necesita gastar miles de millones en reconstruir ciudades enteras -un comité de expertos avisó de que las tareas pueden durar una década-.

(...) [artículo aquí]

Saturday, 11 June 2011


Reuters DEF


Kiyoshi Takenaka and Sumio Ito

Reuters, June 11, 2011

TOKYO (Reuters) - Spending to rebuild Japan's tsunami-hit northeast will spark an economic boom later this year, generating revenues that can be used to redeem reconstruction bonds and reduce the need to rely on long-term debt, the head of a government advisory panel said.

Makoto Iokibe, chairman of the Reconstruction Design Council, also called for a mass consolidation of ports along the coast to boost the fishing industry and aggressive investment to make the region a pioneer in renewable energy development.

The panel will deliver its first set of recommendations by the end of the month, setting the direction for the country's biggest rebuilding effort since the years after World War Two, estimated to cost up to 20 trillion yen ($250 billion).

"We should carry out the kind of reconstruction that helps the Tohoku (northeast) region emerge hopefully as a leader vibrant enough to drive the whole Japanese economy. That's our basic stance," Iokibe told Reuters in an interview.

Three months after the massive March 11 earthquake and tsunami hit, triggering the world's worst nuclear disaster in 25 years, the government is under fire for slow progress in coping.

Securing funds for the rebuilding effort is a major challenge for the government with public debt already twice the size of its $5 trillion economy and rating agencies threatening to downgrade its credit due to the cost of reconstruction.

"If the second supplementary budget is enacted in summer, full-blown construction activity starts in autumn, driving reconstruction-related demand," Iokibe said late on Friday.

"Politicians are leaning toward issuing bonds for reconstruction, but we should not just pass our debt on to future generations. Reconstruction bonds will lead to reconstruction-related demand and an economic boom. Then you can collect."

While Iokibe did not comment on specifics, the panel has in past meetings discussed income, corporate and sales taxes as candidates for hikes to pay back borrowing for reconstruction.

(...) [artículo aquí]

Friday, 10 June 2011


China Daily 3


M.D. Nalapat

China Daily, June 10, 2011

At the Copenhagen Climate Change Conference in December 2009, the European Union (EU) said it had the right to maintain its people's standard of living even if that was unsustainable for the planet. The cure the EU suggested was that China, India, Brazil, South Africa and other emerging economies accept severe emission cuts even at the cost of retarding their growth significantly.

In effect, that meant the standard of living of people in the emerging economies ought to be frozen or even lowered, so that European and other developed countries could continue on their environmentally debilitating trajectory.

Surprising the developed world that banked on disunity among Asian powers, China and India joined hands to block such an unfair outcome.

The developed world's was a "zero-sum" approach, in which it gained at the expense of countries that it had colonized.

Interestingly, we are seeing the return of "trusteeship", in which outside powers gain control of poorer countries - as is the case in Iraq and Afghanistan. Countries such as Libya that refuse to accept such hegemony find themselves under military attack.

Such zero-sum tactics are harmful to the entire world, and eventually to Europe, a continent whose people can justifiably take pride in their cultural and scientific achievements. The zero-sum mindset reflects excess of confidence, and in the case of the EU, this zeal has been the cause of the present financial crisis that it finds itself in.

(...) [artículo aquí]

Thursday, 9 June 2011


The Australian


After years of housing prices gone wild, China's property bubble is starting to deflate.

Bob Davis (The Wall Street Journal)

The Australian, June 9, 2011

Residential prices are heading downward in some major cities, damping some undesired real-estate speculation but raising the prospect that the Chinese economy may slow more rapidly than anticipated with profound consequences for global growth.

Real estate is a foundation of China's phenomenal growth record in the past two decades, and its health is crucial to China's construction, steel and cement sectors.

Real estate is also a favoured investment of Chinese looking to get better returns than bank deposits pay.

Local municipalities and provinces depend on rising prices for land sales as well to fund infrastructure projects.

World Bank economists warned at a Beijing press briefing that a real-estate bubble was among the biggest economic risks China faces.

(...) [artículo aquí]

Wednesday, 8 June 2011




Countries like China and Korea are growing to be more than just manufacturing hubs.

Alex Philippidis

Gen, June 8, 2011

The U.S. may still be the world’s leading nation when it comes to developing, protecting, and commercializing new technologies, but recent global patent numbers point to other countries vying for the top spot. China and several Asian nations are emerging as formidable innovators.

According to the European Patent Office, U.S. applicants brought forth 60,588 applications in 2010, a figure surpassed by the 82,828 filed by the 27-nation EU, whose innovations accounted for almost 90% of the 92,553 filed by the 38 nations comprising the European Patent Convention. The EU’s patent applications rose just 5% over the 2009 figure, compared with 6% for EPC and 12% for the U.S.

However, China’s 12,698 patent applications in 2010 marked a 54% increase over 2009 and a doubling from 2008. Not too far behind was South Korea with 12,342 patent applications, up a healthy 21% from 2009. And weeks before it was devastated by the March 11 earthquake and tsunami, Japan finished last year with a 10% year-over-year gain in patent applications, rising to 41,917, second among all countries.

Emerging Asian nations are expanding their biotechnology industries beyond initial strengths in manufacturing and R&D toward more innovative work in developing treatments, tools, and technologies.

(...) [artículo aquí]

Tuesday, 7 June 2011


The Chosun Ilbo


The Chosun Ilbo, June 7, 2011

Chinese Defense Minister Liang Guanglie's frank comments about North Korea on Sunday were "extremely rare" according to a South Korean intelligence official. "We are trying to persuade them not to take risks," Liang said in a speech at the 10th International Institute for Strategic Studies Asia Security Summit, also known as the Shangri-La Dialogue, in Singapore.

North Korea earlier stepped up the rhetoric against South Korea, saying it would no longer engage the South, revealing a secret meeting with Seoul officials, and threatening "retaliation" for South Korean attempts at psychological warfare.

These developments came in the days after North Korean leader Kim Jong-il returned from a visit to China, and observers believe there must be a connection between Kim's disappointment with the visit and his return to belligerence.

(...) [artículo aquí]

Sunday, 5 June 2011

ASIA 2050

The Daily Star


Ashfaqur Rahman

The Daily Star, June 5, 2011

Last month, the Asian Development Bank (ADB) released a report in its annual meeting held in Vietnam entitled "Asia 2050 -- realising the Asian century." In a breath-taking sweep of economic trends and visions it describes two possible scenarios -- first an "Asian century," which is expected, and the other a "Middle income trap."

ADB prognosticates that Asia's rise this century would be led by seven countries. They are India, China, Indonesia, Japan, Korea, Malaysia and Thailand. In 2010, these seven economies had a total population of 3.1 billion (78% of Asia) and a GDP of $14.2 trillion. But by 2050, these seven economies alone will account for 45% of the global GDP.

Thus, under the Asian century scenario, Asia's GDP would rise to $148 trillion and account for 51% of the global output compared to the present 27% only. On the basis of Purchasing Power Parity (PPP), GDP per capita in Asia would also rise to $45,800, compared to the global average of $36,600.

(...) [artículo aquí]

Friday, 3 June 2011


asia_times_logo OK


Kunal Kumar Kundu

Asia Times, June 3, 2011

BANGALORE - A drop in India's economic growth rate in the three months to March 31, to its lowest over the past five quarters, suggests efforts to contain demand through higher interest rates are beginning to have an impact.

Gross domestic product growth slowed to 7.8%, surprising the market, compared with 8.3% (revised up from 8.2%) in the previous three months, according to Central Statistical Office figures released on May 31. This was substantially lower than the 9.4% rate clocked during the same quarter of the financial year that ended in March 2010.

The full-year gross domestic product (GDP) growth for the financial year that ended in March was 8.5%, lower than the advance estimate of 8.6% released earlier this year but still higher than the FY 2009-10 growth rate of 8%.

The resurgent agriculture sector was the biggest growth driver. Although the fourth-quarter agriculture growth rate slowed to 7.5% from the third-quarter's 9.9%, the annual growth rate touched 6.6%, way above the 0.4% recorded during fiscal 2009-10.

(...) [artículo aquí]

Thursday, 2 June 2011




Bloomberg News

Bloomberg, June 2, 2011

China’s plan to rein in property prices with a record homebuilding program may worsen local debt risks even as it proves a boon to companies from domestic cement makers to Chilean copper exporters.

Premier Wen Jiabao aims to build 36 million low-cost homes by 2015, an initiative that will see 2 trillion yuan ($307 billion) added to local government borrowing by 2012, bringing it to a total 12 trillion yuan, Standard Chartered Plc estimates. The surge of loans to local authorities may spark a wave of bank bailouts that hobble economic growth.

“We’re going to see more financial shenanigans, we’re going to see more money pushed off balance sheets” as banks seek to mask the extent of their lending to local governments, said Singapore-based Fraser Howie, who co-wrote “Red Capitalism: The Fragile Financial Foundation of China’s Extraordinary Rise,” and has been an investment banker in Asia for almost two decades.

“We’re going to see some major recapitalization coming at some point” in the banking system, he predicted.

(...) [artículo aquí]

Wednesday, 1 June 2011


asia_times_logo OK


Antoaneta Becker

Asia Times, June 1, 2011

LONDON - The sex scandal in the top couloirs of the International Monetary Fund and the power struggle to find a successor to now former managing director Dominique Strauss-Kahn has fascinated the Chinese. But despite calls and expectations that China will play a prominent role in determining the new IMF chief, Beijing has been reluctant to comment publicly, and it appears far from ready to take its battle for global recognition to the high echelons of the organization.

China has indeed given its backing to an effort by emerging nations to break the tradition of a European always heading the IMF. In a joint statement with Brazil, Russia, India and South Africa earlier, China slammed Europe's renewed push to lock the IMF top job, calling its stranglehold "obsolete".

By a convention dating back to its 1945 founding, the head of the IMF has always been European while the World Bank president has been a US citizen. But in the aftermath of the financial crisis some of the pillars of the Bretton-Woods system of monetary management established by world powers after the end of World War II have been repeatedly criticized in China as antiquated.

(...) [artículo aquí]