Archive for ‘Chindia Alert’

« Older Entries  |   Newer Entries »
01/06/2013

Yuan may continue to appreciate

China Daily: “The yuan may be trading at below 6.1 against the US dollar as the Chinese currency continues to rise in the next few months, said a currency analyst at DBS Bank.

Yuan may continue to appreciate

A trader with an Asian bank in Shanghai said that the yuan’s valuation has peaked for a few days, while sales of dollars are easing.

An employee from the Industrial and Commercial Bank of China is counting the renminbi and Japanese yen in Huaibei, Anhui province, on May 17. The yuan has gained some 20 percent against the yen since the beginning of the year. Woo He / For China Daily

“Most of my peers working in Shanghai share the opinion that in the short term the renminbi may further appreciate against the US dollar,” the trader said.

China’s central bank, the People’s Bank of China, set the yuan’s midpoint at a record-high level of 6.1796 against the US dollar, while the spot yuan closed at 6.1345 per dollar on Friday.

It has been 12 months since Japan’s yen and China’s yuan became directly convertible, and the yuan has gained some 20 percent against the yen since the beginning of the year.

The appreciation of the yuan and the depreciation of the yen may cast risks to China’s currency as it’s the only currency which lacks the elasticity of East Asian economies, wrote Liu Yuhui, a financial researcher at the Chinese Academy of Social Sciences in an article published on Tuesday.

“It has been very difficult for us to guarantee orders from Japan these days because our price advantage disappeared,” said Yuan Hongtao, owner of a Hangzhou-based plastic production company, which exports some 40 percent of its products to Japan.

Analysts said that policymakers now have to figure out ways to help companies grow, as the renminbi is increasingly going global.

“While the benefits of direct convertibility between the renminbi and other currencies are obvious, including cutting the costs of exchange and reducing the risks brought by the fluctuation of the US dollar, it can also bring some risks to companies and regions in China whose growth is driven by foreign trade,” said Liu Yang, a foreign exchange analyst with Shanghai Gaofu Consultancy.

Currently, the yuan is directly convertible to the yen and the Australian dollar. New Zealand and China are in an early stage of negotiations for direct convertibility of each other’s currencies, according to a Reuters report on May 26.

“One important step to make the renmibi more internationalized is to use more yuan in direct investment overseas”, said Nathan Chow, vice-president and economist of group research with DBS Bank (Hong Kong) Ltd.

Chow said that only about 6 percent of China’s outbound direct investment uses renminbi, while 36 percent of foreign direct investment in China uses renminbi.

If regulations on ODI using renminbi are eased, a large amount of yuan will be released to overseas markets and help divert risks of the fluctuation of the US dollar, which is being used for foreign exchange reserves, said Chow.

He added that more big corporations may want to issue dim sum bonds — yuan-denominated bonds issued in Hong Kong — as the renminbi bond market grew significantly this year, driven by lower funding costs, improved macroeconomic conditions and the heightened expectations for yuan appreciation.

“Despite all these factors, market facilities for renminbi bonds still have a lot of catching up to do. Decision makers and financial institutions need to work closer with corporations, while continuing to improve the fundraising infrastructure in offshore renminbi centers such as Hong Kong and Singapore,” he said.

The yuan had appreciated 1.72 percent against the dollar since the beginning of the year, following a moderate gain of 1.03 percent throughout 2012.”

via Yuan may continue to appreciate |Economy |chinadaily.com.cn.

See also:

Related articles

Posted in China alert, Economics, GeoPolitics, Politics, Reserve currency, Trade | Leave a Comment »

Tags: , , , , , , , ,
01/06/2013

Anna Hazare concludes second phase of Jantantra Yatra

Times of India: “Anti-corruption activist Anna Hazare today concluded the second phase of his Jantantra Yatra here, asking people to “wake up” to change a system where power has gone into the hands of “tainted” people.

English: Hon. Anna Hazare in Nanded , Maharastra .

English: Hon. Anna Hazare in Nanded , Maharastra . (Photo credit: Wikipedia)

“As many as 163 of our MPs are tainted. This means that the system is corrupt and needs to be changes,” Hazare said, adding, he will launch a major campaign from Delhi’s Ramlila Maidan very soon.

He asked people to realise that they hold the key in a democratic setup, and they should bring about amendments to it by voting judiciously for “right individuals”.

Hazare was addressing the last public meeting of the second phase of his campaign, ahead of next year’s Lok Sabha polls.

He asked the youths to come forward and associated themselves with his campaign.

Hazare said he lives the life of an ascetic and recalling an incident, he claimed “once some corrupt people hired contract killers to eliminate me, but they refused, saying they cannot kill a ‘fakir'”.

He said he was grateful to people of Uttarakhand for “showering their love” on him during his campaign.

In his campaign, Hazare covered nearly 50 villages and held public meetings at a number of places including Rishikesh, from where he launched his second phase, Haridwar, Nainital and Haldwani, before concluding it here.”

via Anna Hazare concludes second phase of Jantantra Yatra – The Times of India.

See also:

Related articles

Posted in corruption, India alert, Politics | Leave a Comment »

Tags: , , , ,
01/06/2013

China’s Lopsided Labor Force

BusinessWeek: “While a dwindling number of migrant laborers is helping drive up salaries in China’s assembly-line industries and other low-skilled employment categories, a surplus of college graduates for available white-collar jobs is eroding the bargaining power of those with university degrees.

Students preparing for the college entrance exam in China's Sichuan province

Wages have been steadily rising for China’s 260 million migrant workers—who take jobs in factories, on construction sites, in restaurants, and in other sectors with minimal entry requirements. According to the government-led All-China Federation of Trade Unions, the average monthly earnings of migrant workers across China rose 11 percent from 2011 to 2012, to 2,290 renminbi ($370). That exceeds the rate of China’s GDP growth.

Meanwhile, as central-government investment has allowed China to increase university enrollment and graduation rates massively, the demand for college graduates has not kept up. The number of university degrees awarded annually has risen fourfold in a decade, to about 8 million today.

Among those new graduates who did find employment last year, 69 percent had starting salaries that paid less than 2,000 renminbi per month—in other words, their jobs paid them less than they might have earned as migrant laborers, according to figures reported by a the 21st Century Business Herald newspaper on Tuesday.

Those grim numbers won’t, however, dent the hopes of millions of high-school seniors who will be taking China’s three-day college entrance exam the first week in June. The exam, called gaokao, is widely criticized for stressing rote-memorization skills over critical thinking. Critics have called for reforming the test for years, but for now, it’s still a key hurdle—the first of many—for students aspiring to steady jobs and a middle-class life.”

via China’s Lopsided Labor Force – Businessweek.

See also:

Posted in China alert, Economics, graduate, higher education, labour shortage, Migrant workers, Politics, temporary workers | 1 Comment »

Tags: , , , , , ,
01/06/2013

Sun Pharma Keeps Expanding Overseas

WSJ: “A bid by India’s Sun Pharmaceutical Industries Ltd.  to acquire Swedish drug maker Meda AB  for as much as $5 billion, could be a big plus for Sun, say stock analysts in India.

Mumbai-based Sun Pharma, which makes generic versions of patented drugs including those used for cancer treatment, has been the best performer on India’s benchmark Sensex’s 30-share index this year.

The stock has gained 42% this year to close at 1045.50 rupees ($18.45) a share on Friday. In comparison, Sensex is up only around 3% since the beginning of the year.

Analysts say a big acquisition that expands Sun Pharma’s product offerings would help it grow further. Already, Sun Pharma generates more than 70% of its total revenue from overseas units.”

via Sun Pharma Keeps Expanding Overseas – India Real Time – WSJ.

Posted in Economics, Foreign acquisition, India alert | Leave a Comment »

Tags: , , , , , , , , , ,
01/06/2013

India’s economic growth at slowest rate in a decade

BBC: “India‘s economy grew at its slowest pace in a decade during the 2012-13 financial year, figures show.

An factory worker welds at an air conditioner manufacturing facility near Ahmedabad

The economy grew by 5% over the year, after having grown at an annual pace of 4.8% in the January-to-March quarter.

India was recording annual growth of 9% until two years ago, but in recent months it has seen a sharp decline blamed on a slowdown in its manufacturing and services sectors.

Foreign investors have also kept away due to delays in key reforms.

One factor is India’s weakening job market.

“Companies now want a perfect candidate. Because of the global recession they are cutting down the job opportunities.”

Falling orders and fewer jobs

According to the latest figures released by the ministry of statistics, India’s manufacturing sector grew at an annual pace of 2.6% during the latest quarter while farm output rose by just 1.4%.

The figures are in line with official estimates. In February, India lowered its growth forecast to 5% for the year, underlining the challenges it faced in reviving the sluggish economy.

Last month, Prime Minister Manmohan Singh said the current downturn was “temporary” and he was confident the country’s economy would bounce back to an “8% growth rate”.

However, the mood has remained pessimistic in the business community with industry leaders worried over high rates of inflation.

The slowing economy has also meant that Indian companies are putting less profit back into their businesses.

Annual capital investment growth slowed to 3.5% in the first three months of 2013, down from 4.5% year-on-year in the previous quarter.

Meanwhile, complex business regulations are often blamed for driving foreign companies away.

Foreign direct investment into India has fallen, while the amount of corporate money leaving the country is on the rise.

“The government needs to go all-out to turn around investment sentiment,” said Yes Bank chief economist Shubhada Rao.

via BBC News – India’s economic growth at slowest rate in a decade.

Posted in Economics, India alert | Leave a Comment »

Tags: , , , , , , , , ,
31/05/2013

Urbanisation: Some are more equal than others

The Economist: “FOR many migrants who do not live in factory dormitories, life in the big city looks like the neighbourhood of Shangsha East Village: a maze of alleys framed by illegally constructed apartment buildings in the boomtown of Shenzhen, near Hong Kong. There are at least 200 buildings, many of them ten storeys tall (see picture). They are separated by only a metre or so, hence the name “handshake buildings”—residents of neighbouring blocks can reach out from their windows and high-five.

The buildings are China’s favelas: built illegally on collectively owned rural land. Rents are cheap. An eight-square-metre (86-square-foot) flat costs less than $100 a month. They symbolise both the success of the government’s urbanisation policy and also its chronic failures. China has managed a more orderly system of urbanisation than many developing nations. But it has done so on the cheap. Hundreds of millions of migrants flock to build China’s cities and manufacture the country’s exports. But the cities have done little to reward or welcome them, investing instead in public services and infrastructure for their native residents only. Rural migrants living in the handshake buildings are still second-class citizens, most of whom have no access to urban health care or to the city’s high schools. Their homes could be demolished at any time.

China’s new leaders now say this must change. But it is unclear whether they have the resolve to force through reforms, most of which are costly or opposed by powerful interests, or both. Li Keqiang, the new prime minister, is to host a national conference this year on urbanisation. The agenda may reveal how reformist he really is.

He will have no shortage of suggestions. An unusually public debate has unfolded in think-tanks, on microblogs and in state media about how China should improve the way it handles urbanisation. Some propose that migrants in cities should, as quickly as possible, be given the same rights to services as urban dwellers. Others insist that would-be migrants should first be given the right to sell their rural plot of land to give them a deposit for their new urban life. Still others say the government must allow more private and foreign competition in state-controlled sectors of the economy such as health care, which would expand urban services for all, including migrants. Most agree the central government must bear much more of the cost of public services and give more power to local governments to levy taxes.

Any combination of these options would be likely to raise the income of migrants, help them to integrate into city life and narrow the gap between the wealthy and the poor, which in China is among the widest in the world. Such reforms would also spur on a slowing economy by boosting domestic consumption.

Officials know, too, that the longer reforms are delayed the greater the chances of social unrest. “It is already a little too late,” Chen Xiwen, a senior rural policy official, said last year of providing urban services to migrants. “If we don’t deal with it now, the conflict will grow so great that we won’t be able to proceed.”

Yet Mr Li, the prime minister, would do well to dampen expectations. The problems of migrants and of income inequality are deeply entrenched in two pillars of discriminatory social policy that have stood since the 1950s and must be dealt with before real change can come: the household registration system, or hukou, and the collective ownership of rural land.”

via Urbanisation: Some are more equal than others | The Economist.

See also: https://chindia-alert.org/2013/05/14/right-thing-to-do-comes-with-a-price-tag/

Related articles

Posted in China alert, Construction, Economics, Household registration, Human rights, Inequalities, Labour unrest, Low income, Migrant workers, temporary workers | 2 Comments »

Tags: , , , ,
30/05/2013

Why India’s identity scheme is groundbreaking

BBC: “In an audacious technological mission, India is building a near foolproof database of personal biometric identities for nearly a billion people, something that has never been attempted anywhere in the world.

A woman getting enrolled in a UID booth in Surat

Poorer Indians who have no proof to offer of their existence will leapfrog into a national online system, another global first, where their identities can be validated anytime anywhere in a few seconds.

“India will outdo the world’s biggest biometric databases including those of the Federal Bureau of Investigation and the US-VISIT visa programme,” says Nandan Nilekani, the technology tycoon who heads the programme popularly called by its acronym UIDAI.

The United States’ visa programme is a biometric database of 120 million.

In comparison, the UIDAI has already registered 200 million members, less than two years after the first enrolment.

By 2014 half of India’s population will have an identity tagged to a random, unique 12-digit number.

As more and more Indians have their fingerprints taken, irises scanned and photographs clicked, UIDAI’s chief technology architect Pramod Varma describes the database structure as a “Google-meets-Facebook” scale out.

The information is stored in a fortress like data centre in Bangalore

With its internet-class open source backbone, the database will accommodate more than 12 billion fingerprints, 2.4 billion iris scans and 1.2 billion photographs.

Even more groundbreaking, once established and stored, a person’s identity can easily be verified and authenticated using a cell phone, smart phone, tablet or any other device hooked to the internet.

The information is stored in a fortress-like data centre in Bangalore with a triple layer of security, and travels in highly encrypted packets.

Many of the radical ideas for UIDAI’s technology have come from the talent the project has drawn from the Indian diaspora – tech entrepreneurs like Bala Parthasarathy of HP-acquired photo service, Snapfish and Silicon Valley returnees like Srikanth Nadhamuni, formerly with Intel.

Mr Nilekani himself co-founded and built the multi-billion dollar outsourcing company Infosys before being drafted by the government to head the project.

The programme has studied global best practices in biometric identity databases.

Unlike the United States’ social security number, which is guessable and China’s, which adds the date of birth, India’s 12-digit identity number is randomly generated.

The United States’ visa database does not factor in iris scans while India has included them to provide a greater degree of accuracy.

India’s telecom revolution leapfrogged over several stages of technology in the past decade-and-a-half to great success. Similarly, the massive UIDAI will vault over older technologies.

“By starting on a clean slate and reconfiguring the structure, we have opened up a whole new set of possibilities,” says Mr Nilekani.

The project will stay abreast of the latest in biometrics, cloud computing and connectivity.

Pilot projects using the unique number have begun in parts of India

Costs though have been kept low, first, by adopting an open policy in selecting devices and software and encouraging multiple private vendors.

Second, the project is technology-neutral, not locking in to any particular hardware or software.

If the technology architecture is unique, so is its accuracy in validating identities.

“The combination of 10-finger biometrics, two-iris scans and photograph establishes the identity of a person with over 99.5% accuracy,” says Krishnakumar Natarajan, CEO of Bangalore-based tech outsourcing firm MindTree, which is one of the firms building applications for the project.

The best of the biometric databases in the world have a single de-duplication check, to ensure that every person is identified and tagged only once.”

via BBC News – Why India’s identity scheme is groundbreaking.

Posted in India alert, Politics, Technology | Leave a Comment »

Tags: , , ,
30/05/2013

Chinese wonder why their tourists behave so badly

SCMP: “From faking marriage certificates to getting honeymoon discounts in the Maldives to letting children defecate on the floor of a Taiwan airport, Chinese tourists have recently found themselves at the centre of controversy and anger.

tourists.jpg

Thanks to microblogging sites in China, accounts of tourists behaving badly spread like wildfire across the country, provoking disgust, ire and soul-searching.

While in the past such reports might have been dismissed as attacks on the good nature of Chinese travellers, people in the world’s second-largest economy are starting to ask why their countrymen and women are so badly behaved.

“Objectively speaking, our tourists have relatively low-civilised characters,” said Liu Simin, researcher with the Tourism Research Centre of Chinese Academy of Social Sciences.

“Overseas travel is a new luxury, Chinese who can afford it compare with each other and want to show off,” Liu said. “Many Chinese tourists are just going abroad, and are often inexperienced and unfamiliar with overseas rules and norms.”

When a story broke recently that a 15-year-old Chinese boy had scratched his name into a 3,500-year-old temple in Egypt’s Luxor, the furore was such that questions were even asked about it at a Foreign Ministry news briefing.

“There are more and more Chinese tourists travelling to other countries in recent years,” ministry spokesman Hong Lei said on Monday.

“We hope that this tourism will improve friendship with foreign countries and we also hope that Chinese tourists will abide by local laws and regulations and behave themselves.””

via Chinese wonder why their tourists behave so badly | South China Morning Post.

See also:

Posted in bad behaviour, China alert, Social & cultural, Tourism | Leave a Comment »

Tags: , ,
30/05/2013

China designates service industry new growth engine

Xinhua: “China will step up efforts to build up its service industry to make it a new engine to power sustainable growth, Premier Li Keqiang said on Wednesday.

CHINA-BEIJING-LI KEQIANG-GLOBAL SERVICES FORUM (CN)

Speaking at a summit during the second Beijing International Fair for Trade in Services, Li stressed the important role of the service industry in job creation and economic upgrading.

“Increasing service supplies and improving service qualities will help unleash huge potential in domestic demand, and thus offer firm support for stable economic growth and structural optimization,” he said.

The latest emphasis on service trade is part of China’s efforts to drive growth in the sector to build an upgraded version of the economy.

In 2012, the service industry accounted for 44.6 percent of gross domestic product (GDP), up 2.7 percentage points from a year earlier but still significantly below the share of 60 percent or more seen in many developed countries.

Li noted the key to spur growth in the area lies in reform and opening-up to remove institutional barriers.

“China will further open up the service industry, and pilot free trade experimental zones to tap development,” he said, adding that the government will seek balanced trade and encourage cross-border investments in the sector.

The premier stressed countries should abide by the win-win principles of rising against protectionism, removing trade barriers, and coordinating efforts to facilitate personnel flows, recognition of qualifications and a setting of standards.

Developed countries should lead the effort to open up their markets, while developing economies should be actively engaged in building the global trade mechanism and standards in the service industry, according to Li.

Under China’s 12th Five-Year Plan (2011-2015), the country aims to bring the sector’s proportion of GDP to 47 percent by 2015 and to make it a strategic focus for the country’s industrial restructuring and upgrading to ease reliance on traditional manufacturing.”

via China designates service industry new growth engine – Xinhua | English.news.cn.

See also: https://chindia-alert.org/2013/04/19/chinas-growth-the-making-of-an-economic-superpower-dr-linda-yueh/

Related articles

Posted in China alert, Economics, Services | Leave a Comment »

Tags: , , , , , , ,
30/05/2013

In China, Big Data Is Becoming Big Business

Business Week: “With 1.3 billion people, a quickly expanding urban economy, and rising rates of Internet and smartphone penetration, China generates an immense amount of data annually. If streams of that data can be appropriately sifted, analyzed, and stored, companies seeking to understand China’s often-fickle consumers could have access to valuable real-time insights—and perhaps early warning to the next big consumer trends.

Shopping drives Beijing's Sanlitun area

At a presentation last week at Peking University’s Guanghua School of Management, China’s premier business school, associate professor of marketing Meng Su predicted: “China will soon become world’s most important data market.” He advised job seekers in China and elsewhere to consider training for a new career path as “data scientists,” which he described as “one of the most valuable jobs in the next 10 years.” Interpreting big data seems poised to become big business.

China’s government has signaled its intention to help domestic enterprises develop the infrastructure necessary to store and analyze “big data”—that is, data sets too large to be handled by traditional database-management tools and software. The current Five Year Plan, which aims to stimulate “higher-quality growth,” names seven strategic “emerging industries,” including next-generation information technology.

Meanwhile, leading Chinese firms, especially Internet companies, have already begun to incorporate big data into their strategies. Jack Ma, founder and then-chief executive officer of China’s e-tail giant Alibaba, declared last fall that the company should focus on three pillars of future business: e-commerce, finance (providing loans to small and medium enterprises in China), and data mining. In January, Alibaba underwent a restructuring that, among other changes, created a data-platform division with about 800 employees, as reported in the Chinese financial magazine, Caixin. The Alibaba Group has just begun to scratch the surface of analyzing the reams of user data generated through its business-to-business e-commerce site and its massive consumer-to-consumer platform, Taobao.com.

Professor Su warned, however, that the hype around big data in China may be a case of too much, too soon: “If everyone is talking about something, there is probably already a bubble,” at least of expectations, he said. “Most Chinese companies don’t own enough data, let alone know how to utilize, analyze, or monetize their data.” In other words, a select number of companies in China that do own large quantities of user-generated data—such as Alibaba and Baidu (BIDU)—hold the cards and may profitably sell that valuable information to other vendors.”

via In China, Big Data Is Becoming Big Business – Businessweek.

Posted in China alert, Consumer, Economics, Technology | Leave a Comment »

Tags: , , , , , , , , , ,
« Older Entries  |   Newer Entries »
CCChang

Law of Unintended Consequences

continuously updated blog about China & India

ChiaHou's Book Reviews

continuously updated blog about China & India

What's wrong with the world; and its economy

continuously updated blog about China & India