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Asia Pacific Financial News from John Lothian News – October 4, 2017

Lead Stories

Singapore the Top Expat Destination for Third Year in a Row; USA is the “Land of Opportunity,” Ranks first for Career Progression
BusinessWire
83% Of Expats Feel Confident About Singapore’s Political Stability And 73% About The Local Economy; 73% Of Expats Believe the US is a Good Place to Boost Their Career; 62% Report the US Offers Better Income than Their Home Nation
Expats have rated Singapore as the best country in the world to live and work, while Norway rose four places to come in second, according to the new Expat Explorer survey released today by HSBC, one of the world’s largest banking and financial services organizations. Culturally very different yet both highly-regarded, Singapore and Norway offer expats a stable economic and political environment while giving them a fulfilling experience and an improved family life. For expats in the US, the “land of opportunity” description still rings true. Ranked first for career progression, almost three quarters of expats in the US, 73% compared to 54% globally, believe America is a good place for those hoping to boost their career prospects.
https://goo.gl/4p4F27

Govt. begins drafting separate legal framework for Financial City
Daily Mirror
Amid the controversy surrounding the draft new constitution, the government behind closed doors is drafting a new legal framework to administer the China-backed Colombo International Financial City (CIFC), the 500-acre Colombo sea front reclaimed for a special economic zone, Mirror Business learns.
https://goo.gl/NFHqff

Chinese banking regulator fines 1,171 institutions, totalling 552 mln yuan
Xinhua
China’s banking regulator has punished 1,171 institutions for financial irregularities in the first eight months of 2017, with fines totalling 552 million yuan (about 83.1 million U.S. dollars
https://goo.gl/rDHqos

In China, Cryptocurrency Sales Persist in the Shadows; Seminars on digital-currency investing that once drew hundreds have been scaled back and now take place in smaller, more secretive settings
By Chuin-Wei Yap – WSJ
Three days after Chinese regulators outlawed cryptocurrency fundraising in early September, a woman met with half a dozen individuals at a Beijing golf club to pitch a digital-currency investment opportunity.
https://goo.gl/m4gQ4B

Global electric shock has lessons for Southeast Asia
Tim Buckley – Asia Times
Southeast Asia is at the forefront of a global energy-market transformation that is outpacing even the most ambitious predictions. In the last few days, a report from analyst Wood Mackenzie stated that the ASEAN nations will need to double their energy capacity in the next 20 years, at a cost of more than US$500 billion.
https://goo.gl/P84TQD

Asian chocolate demand set to outstrip global growth; Cocoa prices start new marketing year on a fairly positive note
Emiko Terazono – FT
Asian chocolate demand is likely to increase by about 3 to 4 per cent during the current crop year, exceeding that of global growth of about 2 per cent, according to the world’s largest trader of agricultural commodities.
https://goo.gl/kVrGX6

Exchange News

TOCOM September 2017 Volume Averaged 110,735 Contracts, up 7.8% from August
TOCOM
The Tokyo Commodity Exchange announced today that September 2017 average daily volume was 110,735 contracts, up 7.8% from August. TOCOM’s largest contracts, such as Gold Standard, rose 9.3% to 32,108 contracts. Gold Rolling Spot volume rose 35.8% to 19,373 contracts. Platinum Standard volume was lower by 16.0% to 10,873 contracts. Overall, gain outpaced losses for an overall increase for the month.
https://goo.gl/MmziKx

SGX, CFA Society Singapore and MoneySENSE jointly launch the “Save and Invest Portfolio Series” with Lianhe Zaobao
SGX
Singapore Exchange (SGX) is partnering CFA Society Singapore and MoneySENSE to launch the year-long “Save and Invest Portfolio Series” with Chinese daily Lianhe Zaobao, in a move to encourage Chinese-language readers to save and invest for the future. This follows the success of The Sunday Times Invest section’s “Save and Invest Portfolio Series” that has been running for the past two years.
https://goo.gl/KxEsxU

JPX opens IOSCO’s inaugural World Investor Week
JPX
The International Organization of Securities Commissions (IOSCO) is the international body that brings together the world’s securities regulators. IOSCO will be holding its inaugural World Investor Week(WIW) from October 2 to 8, 2017 to raise awareness of the importance of initiatives in investor education, investor protection, and financial literacy across the world.
https://goo.gl/JKG9H4

Regulatory News

ASIC remakes ‘sunsetting’ class order about mortgage schemes
ASIC
ASIC has remade Class Order [CO 02/238] Mortgage schemes – Chapter 5C and disclosure relief, which was due to expire on 1 October 2017. The new instrument, ASIC Corporations (Mortgage Investment Schemes) Instrument 2017/857, continues to provide:
https://goo.gl/vpgiMc

Investing News

Huge stake in major Chinese conglomerate was held simply as a favor, dealmaker says
Reuters
An Indian-American dealmaker for HNA Group, who recently held a big stake in the Chinese conglomerate, said he kept the shares for a decade as an “accommodation” to the company and received no compensation for doing so.
https://goo.gl/hNsvLm

RBI Gives Foreigners Reasons to Cheer While Holding India Rates
By Kartik Goyal – Bloomberg
The Reserve Bank of India’s hawkish tone and its decision to keep interest rates unchanged at Wednesday’s policy review left local bond traders grappling with losses. But foreign investors are unlikely to complain.
https://goo.gl/HgTv75

Southeast Asia Faces More Currency Risk Than Rest of Region, World Bank Says
By Karl Lester M Yap – Bloomberg
Lender raises growth forecasts for China, Malaysia, Thailand; Other risks include budget deficits, geopolitical tensions
Malaysia, and to a lesser degree Indonesia, Thailand and the Philippines, remain more exposed to exchange rate risk than other developing economies in East Asia and the Pacific as global financial conditions tighten, the World Bank said.
https://goo.gl/E9Jekw

Japan

Saxo Bank Japan to Replace Legal Ledger with Torstone Technology’s Post-Trade Solution; The bank will use Torstone Technology’s Inferno to comply with regulatory reporting requirements in Japan.
Wei-Shen Wong – Waters Technology
Torstone, a post-trade securities and derivatives processing provider, says Saxo Bank Japan looks to add additional Inferno features in future phases.
https://goo.gl/PnoeeB

Tuna price rises hit all parts of Japan’s sushi sector; Conveyor-belt segment unable to raise prices because of tough competition
Emiko Terazono – FT
Bad weather and lower catches have pushed tuna prices up, hitting every part of Japan’s sushi sector, from luxury Michelin-starred bars to value-for-money chains as well as the conveyor-belt segment.
https://goo.gl/nb5pnt

Mainland China

Communist party asserts control over China Inc; Push for cells in joint ventures follows moves to tighten grip on state-owned firms
Lucy Hornby in Beijing – FT
China’s Communist party is making clear that it expects to dictate business decisions — not only at state-owned enterprises, but also at private companies and joint ventures with foreign partners.
https://goo.gl/i5BzGR

What We Know About China’s 19th Party Congress And The Possible Economic Fallout
Sara Hsu – Forbes
On October 18, China will hold its 19th National Party Congress, which will provide broad indications for economic policy in the coming years. While it has been projected that there will be significant changes among the top party members, President Xi is widely expected to be reappointed, and he will likely follow a similar reform trajectory, focusing on mixed ownership reform for state-owned enterprises and less orientation toward the market. Xi’s record so far can provide some understanding of what economic policy will look like in the next five years.
https://goo.gl/Tgq2fk

Whiff of monetary easing sends China stocks to 2-year high; Financial shares lead rally after central bank’s targeted cash injection
Gabriel Wildau in Shanghai – FT
Mainland stocks listed in Hong Kong closed at their highest level in more than two years on Wednesday after China’s central bank cut the share of deposits that commercial banks must hold in reserve.
https://goo.gl/XYkjSK

China State News Calls for ‘Iron Fist’ Regulation of Bitcoin Exchanges
Rachel Rose O’Leary – Coindesk
The Chinese government’s media arm, the Xinhua News Agency, has defended regulators’ recent decision to outlaw token sales, or ICOs, and the voluntary closure of bitcoin exchanges that followed.
https://goo.gl/RWVjR3

Hong Kong

Chinese stocks in Hong Kong touch 2-year high
Alice Woodhouse – FT
Hong Kong-listed mainland Chinese blue chips touched their highest level in more than two years on Wednesday building on gains seen in the previous session after China cut its reserve requirement ratio.
https://goo.gl/YWecQ5

Sorry, the Hong Kong Market Isn’t Really a Bargain; The cheap Hang Seng masks some pricey—and potentially dangerous—stocks
By Nathaniel Taplin – WSJ
Want great exposure to the global reflation story at a much lower price than U.S. equities? Don’t buy Hong Kong.
https://goo.gl/EgEVJC

Did Hong Kong fumble the ball on China’s ‘golden era’? Yes, says Credit Suisse; Hong Kong enjoyed only peripheral benefits in the form of a tourism boom as China rose to global economic prominence, says Credit Suisse economist Tao Dong
Xie Yu – South China Morning Post
Hong Kong has missed the boat on a more than decade-long opportunity to benefit from China’s development, as the mainland’s growth super-cycle is now set to cool amid credit deleveraging and as consumption replaces investment as the centrepiece of the economy, according to Credit Suisse.
https://goo.gl/NPPTNv

Indonesia

Indonesian electricity play imperils national economic goals; Generation plan could unnerve investors and leave private operators on hook for state equity
Nikkei
By 2030 the countries of the Association of Southeast Asian Nations will collectively represent the world’s fourth-largest economy. The region’s links to other major economic powers — China, India, Japan and the U.S. — mean it will become increasingly pivotal for the fortunes of global growth. Inseparable from this outlook, however, is its vast need for energy. Even as economies become less energy intensive, Southeast Asian demand for energy will increase by more than 80% from now through 2040, according to the International Energy Agency.
https://goo.gl/yQ9HSY

Continued Structural Reforms Will Boost Indonesia Growth
Financial Tribune
A conducive external environment, sound fundamentals and progress on structural reforms are supporting the Indonesian economy. The country’s real GDP growth is projected to increase from 5.1% this year to 5.3% in 2018, according to the World Bank’s October 2017 Indonesia Economic Quarterly.
https://goo.gl/U8ZR5q

Singapore

Acra to get regulatory teeth to raise audit quality; Review of Singapore’s Accountants Act could pave way for Acra to do firm-level inspections, mete out sanctions
MICHELLE QUAH – Business Times
SINGAPORE’S public accounting firms, such as those providing auditing services, could soon face the prospect of being sanctioned for lapses in audit quality.
https://goo.gl/3DmHR8

Financial giant’s feel-good challenge draws skilled talent
by Nicola Middlemiss – HRD
J.P. Morgan has confirmed the winner of its recent humanitarian hackathon after students from across Singapore attempted to devise innovative solutions to tricky business challenges.
https://goo.gl/uMtZoV

81% of Singapore’s SMEs Do Not Qualify For Business Financing
Asia One
According to a research conducted by Linkflow Capital , a business loan consultancy firm, up to 81% of SMEs in Singapore do not qualify for business financing.
https://goo.gl/6EjvVj

Vietnam

Prudential seeks sale of Vietnam consumer finance unit for up to $150 million: sources
Sumeet Chatterjee, Anshuman Daga – Reuters
Prudential Plc (PRU.L) has kicked off the sale of its Vietnam consumer finance unit, which could fetch up to $150 million, as the UK firm sharpens focus on its core insurance business in the Southeast Asian nation, people familiar with the process said.
https://goo.gl/J88tk5

Vietnam revamps financial team to hasten state enterprise privatization; Vinamilk to be model; divestment program faces barriers, corruption
Nikkei
Vietnam’s cash-strapped government has brought in a new team of advisers to assist with a state enterprise divestment envisioned as a model for far broader privatization.
https://goo.gl/YReLZk

Thailand

Thai Growth Revised Up
Financial Tribune
Thailand’s leading business groups raised economic forecasts on Tuesday, citing stronger-than-expected exports and signs of recovery in private consumption and investment.
https://goo.gl/wLJ3t8

New financial-technology player eyes ‘unbanked’ Filipinos, partners with Cebu co-op
By Marcel Woo – Business Mirror
A new financial-technology player in the Philippines has partnered with a Cebu-based cooperative as part of its efforts to provide financial services to Filipinos that do not have bank accounts.
https://goo.gl/kebG8z

Islamic finance powerhouse rides out slowdown; Malaysia’s Islamic financial sector, Asia’s largest, has continued to enjoy robust growth
Anthony Rowley – The National
The past two years have seen “slowing” overall growth in the global Islamic financial services industry, according to the Islamic Financial Services Board (IFBSB.
https://goo.gl/PTTjsF

India

RBI bats for retail users of forex trading
By Saikat Das, ET
The Reserve Bank of India has allowed individuals and small businesses to use foreign exchange trading platform as they can use the inter-bank trading platform to cut forex deals, a move that will bring transparency in pricing.
https://goo.gl/bEFgpV

Rajnish Kumar to succeed Arundhati Bhattacharya as SBI chairman; Govt names Kumar as the new SBI chairman for a three-year term
Business Standard
The Govt on Wednesday named Rajnish Kumar as the new chairman of State Bank of India, for a three-year term. Kumar will succeed Arundhati Bhattacharya, who will hang up her boots on Friday.
https://goo.gl/rXXqdb

Job cuts in India: Layoffs in over 120 companies, here is why
Financial Tribune
Job cuts in India: Leading companies have gone for layoffs in 2016-17. According to job data for 121 listed companies reveals net hiring in these companies have come down from 742,012 to 730,694.
https://goo.gl/14Y4Vq

India Seeks to Rework More LNG Contracts Amid Surplus, GAIL Says
By Debjit Chakraborty and Saket Sundria – Bloomberg
GAIL India seeking better terms for 20-year supply agreements; India’s Petronet bargained successfully with RasGas and Exxon
India is pushing to renegotiate more liquefied natural gas deals after its success in reaching agreements with some of the world’s largest energy suppliers.
https://goo.gl/pQYMMu

Australia

Chinese developers ‘walking away’ from Australian projects amid lack of finance
Phillip Lasker – ABC.net.au
A landmark Sydney property at Circular Quay, bought by Chinese commercial property giant Dalian Wanda Group, is now flanked by blank hoardings.
https://goo.gl/42ma6d

UBS survey reveals worrying lack of financial literacy
The Australian
One-third of borrowers with interest-only home loans do not realise they are failing to pay off any of the mortgage’s principal amount, according to a UBS study which raises fresh concerns about the stability of the financial system.
https://goo.gl/Fw8q7P

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About Author

Lothian is executive chairman of John J. Lothian & Co. and editor of the John Lothian Newsletter. He publishes MarketsWiki.com, MarketsReformWiki.com, MarketsWikiEducation.com, JohnLothianNews.com and several industry newsletters.