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Major Clashes Erupt in Hong Kong Ahead of China’s National Day Three of Hong Kong’s main commercial districts were engulfed in thick clouds of tear gas on Sunday as pro-democracy demonstrators battled the police in an open challenge to Beijing just two days before China celebrates 70 years of Communist rule. -NYT

Street fires burn in Hong Kong amid running battles between protesters and police -Reuters

The Coming Crisis of China’s One-Party Regime In 2012, Chinese President Xi Jinping promised that the Communist Party would deliver great successes in advance of two upcoming centennials, in 2021 and 2049. But no amount of nationalist posturing can change the fact that the fall of the CPC appears closer than at any time since the end of the Mao era. -Project Syndicate

Trump's turn at Modi's Houston rally only obscures US-India rifts Washington's pressure on New Delhi benefits America's adversaries -Nikkei

After a China-Vietnam Standoff, Expect a Turn to the US Coercive Chinese tactics to settle South China Sea disputes serve as a catalyst for enhanced Vietnam-U.S. security cooperation. -The Diplomat

Opposition slams Australia’s China ties -Taipei Times

“What we saw this week was the prime minister in the United States in the context of there being trade tensions between the US and China, and from there, taking pot shots against our largest trading partner,” Marles said. “The context in which he has engaged in this megaphone diplomacy is absolutely the issue, and it’s not the way in which this issue should be dealt with in a respectful way.”

GLOBAL BUSINESS

US-Japan trade deal is victory for Abe, not Trump Tokyo offered nothing more than it had three years ago Days later, China’s move to retaliate with $75 billion of tariffs on U.S. goods played right into Tokyo’s hands. Team Trump blinked, dropping demands for low-tariff quotas on dairy and other products beyond what Japan accepted under TPP. This slimmed-down deal matters, of course. Trump gets to tout selling more beef, cheese, corn, pork, wheat and wine: in theory, the pact reduces tariffs on $7.2 billion of agricultural goods. -Nikkei

Starbucks Can't Afford a Misstep in Hong Kong The coffee chain has to weigh its ambitious expansion plans in China against pressure to appease protesters. -Bloomberg

This dirty word is driving economic change in Japan Unfortunately, new laws that took effect in April to open the country wider to workers from abroad don’t go far enough. Prime Minister Shinzo Abe’s proposal to bring in 345,150 foreigners over five years — watered down to appease conservative lawmakers — falls short of the 1.5 million needed to fill Japan’s labor shortage. -The Japan Times

US Investment Diplomacy and India’s Preferential Trade Status Putting the U.S. termination of India’s preferential trade status in perspective -The Diplomat

Southeast Asia must find the right balance in ride-hailing regulation States should support free market and technology, not hinder innovation -Nikkei

Downtown Singapore Is a New Property Playground In about a decade, the city’s central business district will become more residential. That’s good news for landlords. -Bloomberg

Fearing a loss of investment, Bangladesh assuages multinationals Minister to mediate telcos' tax dispute while secretary to lobby drug giant Sanofi -Nikkei

GLOBAL MACRO

U.S. Treasury Says No Plans to Block Chinese Listings ‘at This Time’ Treasury official says option is not on the table at this time -Bloomberg

Nasdaq cracks down on IPOs of small Chinese companies -Reuters

Foreign investors dump Indonesian shares for bonds as global slowdown looms -The Jakarta Post

India keen to import more Thai rubber High tariffs have limited the market, with both sides eager to cut them -Bangkok Post

Govt unhappy with half of House-proposed revision of minerals law The Energy and Mineral Resources Ministry announced on Wednesday evening that the government tentatively had 938 points of disagreement with the House of Representatives’ proposed revision of the 2009 Coal and Mineral Mining Law -The Jakarta Post

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Japan and US agree on trade as Trump hungers for farm win President hails 'really big' corn purchase after weekend talks -Nikkei

Japan calls South Korea's Takeshima military exercises 'unacceptable' as ties continue to sour Tokyo on Sunday protested South Korean military exercises that Seoul said were intended to “defend” a cluster of rocky islands that both nations claim, calling the drills “unacceptable,” just days after the South said it would leave a key intelligence-sharing pact it had signed with its Asian neighbor. -The Japan Times

China signals intervention as Hong Kong's protests intensify -SCMP

Inside the Hong Kong Protests The Communist Party of China would like the mainland Chinese population and the rest of the world to believe that the ongoing, sometimes violent protests in Hong Kong pose a threat of "terrorism." But the truth is that China has only itself to blame for pushing the city's idealistic youth into the streets once again. -Project Syndicate

Taiwan's new centrist political party is struggling for space Issues of sovereignty and Hong Kong protests dominate discussions -Nikkei

GLOBAL BUSINESS

Explainer: What tools could Trump use to get U.S. firms to quit China? Unlike China, the United States does not have a centrally planned economy. So what legal action can the president take to compel American companies to do his bidding? -Reuters

Corporate America Sounds Alarm on Trump’s Threats Over China -Bloomberg

“He has a lot of authority through the national security statutes to disrupt trade and commerce in a way that would cause huge damage -- not just to the Chinese economy, but to the global economy and the U.S. economy”

China warns global CEOs: Toe the party line on Hong Kong The threat of losing access to China’s US$14 trillion economy leaves corporate bosses with no choice but to bow to Beijing’s authoritarian demands -Taipei Times

As Cathay feels the heat of political risk in China, it’s time to remember lessons of the Mao era -SCMP

·      Xi Jinping’s administration highlights how politics has always been in command in China, and companies must either adapt or rethink their China business

·      But nationalistic leaders and web users would do well to remember the losses suffered through extreme political correctness in the Mao era

Trade war hammers foreign investment in China and Southeast Asia New greenfield investment falls to 2009 level as globalization reverses course -Nikkei

Twitter Reveals China's Influence Campaign Targeting Hong Kong Protests It’s the first instance of a U.S. social media company identifying a Chinese government-run disinformation campaign. -The Diplomat

Indonesia threatens to halt Airbus jet orders over palm oil feud -Jakarta Post

Ministries call for enhanced management of foreign workers in Việt Nam -VietNamNews

Traditional taxi firms demand equal treatment with ride-hailing apps In Southeast Asia, the rise of ride-hailing companies like Grab and Go-Jek has shaken up urban transportation and caused traditional taxi operators to lose market share. -VietNamNews

GLOBAL MACRO

Asia shares shaken, yen jumps on China-U.S. trade jitters Asian shares seemed set for a turbulent start on Monday as the latest salvo in the U.S.-China trade war shook confidence in the world economy and sent investors steaming to the safe harbor of sovereign bonds and the Japanese yen. -Reuters

Seoul to minimize economic fallout from trade row with Japan -Yonhap

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Trump drops bid to slash foreign aid after Congress objects The White House will not move forward with plans to cut billions of dollars in foreign aid, U.S. officials said on Thursday, after an outcry from Congress about what was seen as an attempt to sidestep lawmakers’ authority over government spending. -Reuters

To Gain Leverage in China Trade Talks, Trump Shows Solidarity With Hong Kong -NYT

China blames Canada for difficulties in relationship, demands Huawei executive be freed Relations have been icy since Meng was detained in Vancouver last December on a U.S. warrant. China has since charged two Canadians with spying and halted imports of canola seed and meat products from Canada. -Reuters

Imported repression: How Cuba taught Venezuela to quash military dissent -Reuters

GLOBAL BUSINESS

Trump thinks tariffs will add U.S. manufacturing jobs. Economic reality says they won’t. Even companies interested in bringing jobs to the U.S. say duties on imported parts are hurting those efforts. -Politico

One Week Left Before Nearly All 'Made In China' Is Tariffed But as 10% tariffs on roughly $300 billion worth of goods goes into effect on Sept 1., there are other issues percolating that are still hard to grasp. The tech war with Huawei at the center continues apace. It is unclear how long this latest reprieve, allowing for some U.S. companies to sell microprocessors to the Chinese telecom giant, will last but it remains a reliable front in the trade war. -Forbes

YouTube Closes 210 Accounts Tied to Hong Kong Influence Campaign Google said it disabled 210 YouTube channels involved in “coordinate influence operations” around the Hong Kong protests, following similar measures earlier this week by social media companies Facebook Inc. and Twitter Inc. -Bloomberg

The US government’s battle with Chinese telecom giant Huawei, explained The US has long expressed concerns about Huawei and its ties to the Chinese government. -Recode

SEC fines Deutsche Bank $16 million to settle foreign corruption charges -Reuters

Overstock.com CEO Resigns after Disclosing Relationship with Russian Agent Maria Butina -National Review

GLOBAL MACRO

Fed’s Regional Presidents Lining Up Against Additional Rate Cuts Three Federal Reserve policy makers voiced their resistance to the notion that the U.S. economy needs lower interest rates, and fourth said he wanted to avoid taking further action “unless we have to,” foreshadowing a sharp debate with officials who want to cut again. -Bloomberg

$960B deficit expected this year, more than $1 trillion next The return to trillion-dollar deficits has been moved up by two years from the previous forecast in May -Roll Call

Emerging Markets Have Lost Faith in the Fed Once a beacon of stability, the U.S. has become a source of tumult. Markets now give global central bankers a clearer read on the economy. -Bloomberg

IMF embraces new central bank digital currencies -Roll Call

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Trump says North Korea's Kim sent 'very beautiful letter'; new meeting possible -Reuters

Kim fires more missives, more missiles North Korea’s leader is wielding both carrot and stick, but neither measure is moving him toward his goal -Asia Times

Trump Is Making Xi’s Superpower 2050 Plan Tougher by the Day His grand vision is now looking more aspirational by the day. As mounting pressure from Donald Trump adds to a slew of structural challenges facing China’s $14 trillion economy -- including record debt levels, rampant pollution, and an aging population -- the risk is that the country gets stuck in a “middle-income trap,’’ stagnating before it reaches rich-world levels of development. -Bloomberg

New phase as protesters and police clash across Hong Kong in guerilla-style battles

  • Officers use tear gas to disperse crowds that once more gathered for illegal rallies, but scale and intensity of skirmishes appears to have lessened

  • Two sides engage in running battles from Kwun Tong to Tai Po and Cross-Harbour Tunnel, while peaceful sit-in at the airport continues

A trade war over history? Sort of. Why Japan and South Korea are feuding. The trade spat kicked off with Tokyo imposing restrictions on chemicals key to South Korea’s high-tech industry, citing unspecified security concerns. Most observers, however, see the trade war as historical frictions spilling over into economic and national security arenas – underscoring how large the past looms in East Asia today. -Christian Science Monitor

Pakistan downgrades ties with India Pakistan has suspended bilateral trade with India and will downgrade diplomatic ties in a bid to build pressure against its neighbour for changing the status of Kashmir. -The Straits Times

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GLOBAL BUSINESS

China to push to attract more high-tech manufacturers China on Tuesday said it would implement a special tax policy in the newly expanded Shanghai Free Trade Zone, granting crude oil import licenses to qualified companies and providing preferential tax policies for firms operating in artificial intelligence, civil aviation, semiconductor and biopharmaceutical sectors. -Reuters

Huawei unveils Harmony operating system, won't ditch Android for smartphones -Reuters

Toyota to build battery plant in China, eyeing hybrid policy shift Panasonic-backed supplier to quadruple production in world's top auto market -Nikkei Asian Review

South Korea boycott hitting sales of Japan's Uniqlo, company says -Reuters

Samsung secures key chip supply in Belgium as Tokyo curbs exports Korean tech groups accelerate diversification while keeping Japanese suppliers -Nikkei Asian Review

Casino resort frontrunner MGM says winning and building Osaka facility by 2025 is tough but doable For Osaka, considered the front runner of the three locations that will be allowed to host the resorts, the hope is that once the Diet formally approves all necessary policies, the bureaucratic process for granting interested localities IR licenses, and subsequent construction, will go smoothly and quickly. By March 2025, just a couple of months before the Osaka World Expo opens, the city wants a casino resort to be up and running. -The Japan Times

India eases angel tax rules for startups Registered companies will now be exempt from verification The angel tax is imposed when any startup raises equity funding in excess of its “fair valuation.” The premium is treated as income, attracting a tax of more than 30%. The new tax was introduced in 2012 to curb money-laundering. It is known as the angel tax as it largely affects angel investments in startups. -Asia Times

#SMART Singapore slings a trade war antidote New Singapore Convention on Mediation promises neutral settlement of commercial and trade disputes. China, US are among its backers The Singapore Convention on Mediation, the first treaty concluded under UN auspices to be named after the city-state, aims to give businesses greater confidence to settle international disputes through mediation, which involves a neutral party working with different sides to come to an agreement rather than resort to costly court proceedings. -Asia Times

Jokowi signs electric vehicle regulation -Jakarta Post

GLOBAL MACRO

Booming Travel Is Transforming Asian Airports Into Mini-Cities New facilities aim to become destinations in themselves, with apartments, exhibition spaces, and medical centers. -Bloomberg

Modi’s Kashmir detour spells trouble for India’s economy The J&K move is as much a cry for economic help as an announcement of any new authority the Indian PM has amassed -Asia Times

Global funds set sights on Japan property market Aberdeen Standard and KKR see opportunity in low-rate environment The influx of deep-pocketed foreign players, enticed by the Bank of Japan's ultralow interest rates that allow for fundraising on the cheap, indicates that the property boom here is unlikely to lose steam anytime soon. -Nikkei Asian Review

Volatility in China's yuan due to escalating U.S. trade friction: PBOC official -Reuters

India Seeks Used Cooking Oil to Help Modi Cut Energy Imports India is the third biggest crude oil consumer on the globe and meets about 85% of its needs through imports, exposing the economy to the risks of price and supply disruptions often caused by geopolitical tensions and trade wars. The prime minister has set a target to reduce such overseas energy purchases by 10 percentage points by 2022, through increased domestic output and greater use of alternative fuels. -Bloomberg

Canada LNG project to ship gas to Asia as early as 2024 Government subsidies for project aim to reduce reliance on US market -Nikkei Asian Review

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CHINA destabilizing Indo-Pacific: U.S. Defense Secretary -Reuters

CHINA warns that Beijing 'will not sit idly by' and let Hong Kong unrest continue -The Japan Times

CHINA says 'won't back down' on principles despite tariff threat Trade tensions flare anew after cabinet-level meeting in Shanghai produces little -Nikkei

Hong Kong police fire tear gas near Causeway Bay, Beijing's Liaison Office as protesters take over key roads -The Straits Times

Japan and South Korea Are Learning the Wrong Lessons From China The adoption of a rival’s coercive tactics by a U.S. ally is alarming. -The Diplomat

Is populism finally coming to Japan? -The Japan Times

Singapore's new opposition calls for curbs on foreign labor Progress party unveils agenda as it looks to challenge People’s Action Party -Nikkei

GLOBAL BUSINESS

Elon Musk to launch China unit for tunneling company this month Elon Musk will soon launch a China unit for his underground tunneling enterprise, The Boring Company, the billionaire entrepreneur said on Twitter. -Reuters

Beijing is using Chinese tourists to inflict economic pain – but does it work? -SCMP

·         Ban on individual mainland travelers going to Taiwan is the latest move to apply pressure on the self-ruled island

·         It’s not the first time China has used tourism restrictions in this way

Another four firms to invest in Taiwan: ministry NT$504.7 billion (US$16.09 billion) in investments as another four companies joined a government program aimed at boosting investment in the nation. As a trade dispute between the US and China continues, the ministry has approved 102 companies returning to invest in the nation, providing up to 43,900 job opportunities, while another 50 companies are waiting in line. -Taipei Times

U.S. softens stance on autos in trade negotiations with Japan, sources say -The Japan Times

How a shadow banking crisis sent India's autos sector into a tailspin -Reuters

Chinese smartphone brands do battle in India as more consumers upgrade to expensive models -SCMP

·         Indian consumers are upgrading to more expensive smartphones, opening up new opportunities for Chinese brands

·         OnePlus, a Shenzhen-based brand, is the top in sales for the premium market in India

Australians endorse Huawei ban as part of hard line on China Canberra risks standing alone after Trump flip-flopped and neighbors caved -Nikkei

Venture Capital in Southeast Asia In episode 310, Justin Hall, partner from Golden Gate Ventures joined us in a conversation to discuss the state of venture capital in Southeast Asia. Justin shared his career journey in how he progressed from an associate to a partner within one of the well-known venture capital firms in Southeast Asia and explained what he has learned over the years from working with startup founders and companies. -Analyse Asia

Companies are moving supply chains out of China and into Vietnam And then there’s the Trump factor. While imports to the U.S. from China are falling, imports from Vietnam are growing rapidly. “Vietnam, after China, has the biggest trade surplus to the U.S.,” says Bell. “You have to wonder how long Mr. Trump turns a blind eye.” -MarketWatch

Total 79,300 firms set up in seven months: GSO About 79,300 new businesses were established in Việt Nam with total registered capital of VNĐ999.4 trillion (nearly US$43 billion) in the first seven months of 2019, data from the General Statistics Office (GSO) has revealed. -VNNews

GLOBAL MACRO

Offshore yuan slides towards record low after Trump tariff threat -SCMP

·         The offshore yuan traded weaker on Friday, touching a low of 6.98 against the US dollar, close to its lowest level in two-and-a-half years

Japan, U.S. target broad bilateral trade deal by September Washington seeks early opening of Japan’s agriculture sector including reductions in 38.5% tariffs on U.S. beef imports, while Japan calls for abolition of U.S. tariffs on Japan’s industrial goods such as car parts. -Reuters

South Korea readies stimulus to soften impact of Japan trade rift Tokyo says removal of Seoul's special status adheres to WTO rules -Nikkei

Lighthizer Says Vietnam Must Cut Its Trade Surplus With U.S. -Bloomberg

Mongolia's agreement with US will not affect relations with Moscow, Beijing Mongolia and the United States signed an agreement on strategic partnership during Mongolian President Khaltmaagiin Battulga's visit to Washington -TASS

Vietnam Extends Oil Rig Operations Amid Vanguard Bank Standoff With China Refusing to back down, Hanoi authorizes the extension of exploratory work by the Hakuryu-5 oil rig. -The Diplomat

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Trump Says U.S. Will Hit China With More Tariffs President Trump, frustrated by increasingly fruitless negotiations with China, said Thursday that the United States would impose a 10 percent tariff on an additional $300 billion worth of Chinese imports next month, a significant escalation in a trade war that has dragged on for more than a year -Politico

Trump's pick for top envoy to the U.N. gets Senate approval The U.S. Senate on Wednesday confirmed Ambassador to Canada Kelly Craft to become the top American envoy to the United Nations, despite criticism from some Democrats that she lacks the experience needed for the key diplomatic position and was routinely absent from her post in Ottawa. -Politico

Trump says working on free trade deal with Brazil -AFP

The Republican Exodus From Congress Eight Republican House members have announced their retirement this year, with more predicted to follow. What’s going on? -NYT

GLOBAL BUSINESS

The U.S. Might Sanction a Russian Pipeline to Germany. That’s a Terrible Idea. -Politico

Against the Republican Daddy State On Tuesday, Senator Josh Hawley introduced his second proposed regulation of social media in as many months. In June, he introduced a bill to regulate political speech on large social-media platforms. In July, he followed it up with the “SMART Act,” a bill designed to curb allegedly addictive features contained in popular applications such as Twitter, Snapchat, and YouTube. -The National Review

Apple Suspends Listening to Siri Queries Amid Privacy Outcry -Bloomberg

U.S.-China Trade War May Finally Be Coming for Apple The iPhone maker has said little publicly about its potential hit or what steps it might take to mitigate the impact. -Bloomberg

Trump Administration Weighs Allowing Drug Imports for Cheaper Prescriptions The proposal was announced between two Democratic debates, seemingly timed to show that President Trump was also trying to tackle the highly populist issue of soaring drug prices -NYT

Pentagon puts $10 billion JEDI contract on hold after Trump suggests it favored Amazon The Pentagon has decided to put on hold its decision to award a $10 billion cloud computing contract after President Donald Trump said his administration was examining Amazon.com Inc’s (AMZN.O) bid following complaints from other tech companies. -Reuters

Cuba Expands Internet Access to Private Homes and Businesses -NYT

GLOBAL MACRO

Global stocks pummeled by Trump's tariffs, safe-havens surge Global stocks are set to take another beating on Friday after U.S. President Donald Trump said he would slap a 10% tariff on the remaining $300 billion of Chinese imports from next month. -Reuters

A $600 Billion Bill: Counting the Global Cost of the U.S.-China Trade War Bloomberg economists Dan Hanson and Tom Orlik have mapped out the main scenarios. Their headline conclusion: If tariffs expand to cover all U.S.-China trade, and markets slump in response, global GDP will take a $600 billion hit in 2021, the year of peak impact. -Bloomberg

5 Smart Reasons to Tax Foreign Capital A bipartisan bill that would create a trade-balancing exchange rate for the dollar also aims to reduce foreign purchases of certain U.S. assets. -Bloomberg

Mexico's dependence on U.S. demand spells trouble for weak economy -Reuters

Will Bolsonaro's Free-Market Revolution Succeed? The first seven months of Brazilian President Bolsonaro have been driven by the idea that only free-market reforms and innovation can bring Brazil back on track after more of a decade of corrupted socialist governments led by Brazilian Workers' Party. -Forbes

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Donald Trump and Boris Johnson ‘working already’ on trade deal Johnson ‘has what it takes, they needed him for a long time,’ says US president. -Politico.eu

Iran Links British Seizure of Oil Tanker to Ailing Nuclear Deal -NYT

US formally asks Germany to 'help secure' Strait of Hormuz The US wants Germany to take part in a UK-proposed, European-led naval mission to protect ships sailing near Iran. German politicians were less than thrilled by the initiative, which aims to "combat Iranian aggression." -DW

Russia launches probe into 'mass unrest' at Moscow protest More than 1,000 people were detained during the unauthorised protest against the exclusion of opposition candidates from local polls. -BBC

GLOBAL BUSINESS

Companies using Facebook 'Like' button liable for data: EU court Companies that embed Facebook’s “Like” button on their websites must seek users’ consent to transfer their personal data to the U.S. social network, in line with the bloc’s data privacy laws, Europe’s top court said on Monday. -Reuters

German law targets money laundering in property market Germany's government is unveiling a new law aimed at combating money laundering in the real estate sector. It's estimated that billions in illegal earnings are funneled into the German property market each year. -Reuters

Trump vows to retaliate over France’s digital services tax US president announces ‘substantial reciprocal action on Macron’s foolishness.’ -Politico.eu

Trump threat to tax French wine completely moronic, minister says -BBC

Huawei says US campaign hit business in Europe, no ‘major disruption’ overall The company announces it has booked €52 billion in revenue in the first half of 2019. -Politico.eu

BAE Systems Earnings Gain on Increased U.S. Defense Spending -Bloomberg

US Senate fails to block Trump vetoes on Saudi arms sales The Senate has failed in a bid to override a series of vetoes issued by President Donald Trump, allowing the administration to move forward with plans to sell billions of dollars of weapons to Saudi Arabia and the United Arab Emirates. -Reuters

‘Small Is Beautiful’ Can Work in Developing Africa Solar and mobile technology offer ways to work around the continent’s shaky infrastructure. -Bloomberg

GLOBAL MACRO

The End of ECB Restraint Outgoing European Central Bank President Mario Draghi has indicated that the bank is planning a new round of aggressive monetary stimulus. Such measures will most likely have negative economic consequences – not least by further increasing the cost pressures weighing down German industry. -Project Syndicate

Germany's top court faces case of deja vu over ECB bond buying Germany's Constitutional Court is once more dealing with the question of whether the European Central Bank's asset purchases constitute illegal state funding. A "Yes" from Germany's top judges could lead to chaos. -DW

One direction: Brexit-hit pound facing gravity of parity Currency traders who were wary of positioning outright for a no-deal Brexit outcome seem to be finally be throwing in the towel: heavy selling has hit sterling this month and metrics such as derivatives and positioning suggest no respite ahead. -Reuters

Iran's vice president urges China, friendly countries to buy oil Iranian Vice President Eshaq Jahangiri called on China and other countries friendly with Iran on Monday to buy more Iranian oil, the oil ministry news website SHANA reported, as Chinese imports plunged after U.S. sanctions took effect. -Reuters

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China’s maritime expansion reflects a curious mix of ambition and paranoia Chinese strategists urge Westerners to understand that their country’s rise as a naval power is guided in part by deep insecurity -The Economist

Why This Narrow Strait Next to Iran Is So Critical to the World’s Oil Supply -NYT

China is not an enemy -The Washington Post

Statesmanship and creativity are needed as Washington and Beijing renegotiate a relationship that is too big to fail. -AFSA

Nailed It – Navarro Discusses U.S-China Trade Re-engagement -The Last Refuge

Mass protest draws tens of thousands to streets of Kowloon in protest against Hong Kong extradition bill -SCMP

·       Protesters march through shopping district of Tsim Sha Tsui to cross-border high-speed rail terminus in hope of explaining cause to mainland Chinese visitors

·       Organisers say 230,000 took part – far more than expected – while police put figure at 56,000

 Hong Kong and Taiwan Are Bonding Over China Hong Kong and Taiwan long had a relationship built around trade and tourism. But as China clamps down in Hong Kong, ties between the pair are strengthening. -The Atlantic

GLOBAL BUSINESS

China Appeal Fading for Japanese Companies A Teikoku Databank survey found that there were 13,685 Japanese companies operating in China as of May 2019, a decrease of 249 compared to the previous survey conducted in 2016. Doing business in China has come to appear less attractive, with rising labor costs in the country over recent years among the declining benefits. Another factor is concern about the future impact of intensifying US-China trade friction. -Nippon.com

Walmart China plans $1.1bn investment in logistics Program includes building or updating more than 10 distribution centers over the next 10 to 20 year -Asia Times

Japanese firms cautious of fallout from deteriorating ties between Tokyo and Seoul A number of firms said they are anxiously watching developments, noting it remains unclear if the newly-introduced regulations will actually hinder trade between the two nations. Under the new regulations, at the longest, it could possibly take 90 days for Japanese exporters to get official approval on certain key items bound for South Korea. -The Japan Times

Samsung chief visits Japan to seek export curb workarounds Electronics maker urges such steps as supplying South Korea from overseas plants -Nikkei

If Masayoshi Son Won't Invest in Japan, Why Should You? His $100 billion Vision Fund is noticeably absent on its home turf. That speaks volumes about the health of the country’s startup scene. -Bloomberg

Taiwan to cut tariffs on sake and Japan farm and fishery products as it looks to join TPP -The Japan Times

Myanmar economic zone reimagined as export hub to India Japan hopes reworked Dawei will mean more leverage over Chinese influence -Nikkei

Is Beijing hitting out at offshoring in Cambodia? -Asia Times

Cambodia and Vietnam in the US-China Trade War: Not All Good News Both countries face opportunities, but investors cannot overlook the lingering risk -The Diplomat

GLOBAL MACRO

Time to end BOJ's grand experiment? Central banks are back on the center stage of the global economic policy debate. The U.S. Federal Reserve and the European Central Bank now appear ready to ease monetary policy — in a turnaround from just some months ago when people were looking for “exit” and additional rate hikes. -The Japan Times

EM Carry Trades With a 6% Yield Are Getting Harder to Resist -Bloomberg

Thai baht races ahead of Prayuth's slow progress The strong currency is hurting Thailand's competitiveness and threatens further damage -Nikkei Asian Review

Erosion of Hong Kong’s institutional autonomy will hurt advantage over mainland China cities, high credit rating: Moody’s -SCMP

·       Ratings agency affirms city’s long-term issuer rating of ‘Aa2’

·       City’s status as an independent entity could be ‘altered suddenly and much earlier than 2047’ by some of its international partners, the agency says

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EU leaders settle on a new team to run the club -The Economist

Leaders choose France's Lagarde for ECB after marathon summit European Union leaders agreed on Tuesday to name France’s Christine Lagarde as the new head of the European Central Bank and sealed a deal on filling the EU’s other top four jobs after marathon talks that have exposed deep divisions in the bloc. -Reuters

Iran to boost uranium enrichment level, breaching nuclear pact: Rouhani -Reuters

Turkey, China seek to expand economic ties despite political differences Turkey and China have expanded ties, but their relationship is marked by continued distrust and competition. The two sides are expanding economic cooperation but fundamental political differences remain. -DW

How to Sink the Pirates Plaguing West Africa After a crackdown near Somalia, the crime wave just shifted to the Gulf of Guinea. Local nations and their allies can end it. -Bloomberg

GLOBAL BUSINESS

Euro zone June business growth slow as factories still faltering Euro zone business activity picked up slightly last month but remained weak as a modest but broad-based upturn in the services industry offset a continued deep downturn in factory output, a survey showed.

EU reaches trade deal with South American bloc The European Union and South American trade bloc Mercosur sealed a blockbuster trade deal Friday, ending 20 years of talks over one of the world's largest regional commercial accords, negotiators said. The agreement came after two decades of often tough negotiations between the EU and the countries of Mercosur -- Argentina, Brazil, Paraguay and Uruguay -- which had repeatedly stalled because of European farmer sensitivities over the beef market. -France24

U.S. Proposes New Tariffs on $4 Billion of E.U. Goods as Trade Dispute Grows The United States moved to impose levies on more products than previously planned in an escalation of its fight with Europe over government aid for Boeing and Airbus. -NYT

Scotch whisky targeted by new US tariffs -BBC

Germany fines Facebook for underreporting hate speech complaints The US social media giant has been found guilty of failing to fully report the number of complaints it received, in clear violation of German transparency laws. Facebook may appeal the ruling, saying the law is unclear. -DW

Ford to cut 12,000 jobs across Europe by end of 2020 UK, Germany and Russia to be hardest hit as car manufacturer swings axe -The Independent

GLOBAL MACRO

The ECB Needs New Inflation Rules The European Central Bank has consistently undershot its inflation objective of “close to, but below 2%” for over a decade, potentially threatening its credibility. To maintain credibility, the ECB should adopt a two-pronged strategy focusing on a medium-term inflation target and systematically smoothing financial cycles. -Project Syndicate

Switzerland-EU partnership row passes deadline Brussels refused to extend recognition of Swiss market regulation, effectively banning EU-based banks and brokers from trading on Swiss exchanges. -DW

PM Conte says Italy will receive competition portfolio in next EU Commission Prime Minister Giuseppe Conte said on Tuesday Italy would receive the influential competition portfolio in the next European Commission, adding he was confident his nation would also obtain a post on the next ECB board. -Reuters

Italy Proves How Markets Have Abandoned Logic The “greater-fool” theory leads market commentary. Plus, a dour U.K. forecast, dented tin, a debt-ceiling dance and more. -Bloomberg

Brexit is being blamed for dismal manufacturing numbers. Is a rhetoric recession on the way? -The Independent

Russia and OPEC Draw Closer on Oil, Joining Other Producers to Manage Market -NYT

YOUR GEOPOLITIX BOTTOM LINE

APAC Mondays.png

GEOPOLITICAL RISK+GLOBAL MARKETS

APAC MARKETS IMPACT + OPPORTUNITY

Trump Steps Into North Korea and Agrees With Kim Jong-un to Resume Talks President Trump became the first American commander in chief to set foot in North Korea on Sunday. He greeted the country’s leader at a last-minute meeting at the Demilitarized Zone -NYT

China warns of long road ahead for deal with U.S. After ice-breaking talks China and the United States will face a long road before they can reach a deal to end their bitter trade war, with more fights ahead likely, Chinese state media said after the two countries’ presidents held ice-breaking talks in Japan. -Reuters

“We’ve said it before - communication and friction between China and the United States is a long-term, difficult and complex thing. Fighting then talking, fighting then talking, is the normal state of affairs,”

Three Lessons from the Hong Kong Protests Enormous protests this month in Hong Kong over a proposed extradition law have revealed the depth of citizens’ concern for their way of life, and of their anger at Chief Executive Carrie Lam’s gross mismanagement. -Project Syndicate

First and most obvious lesson of recent events is that Lam is a liability as chief executive, and that she has squandered all credibility.

Second, Hong Kong’s protesters and activists have succeeded so far because they did not directly challenge Xi or the CPC, but instead focused on Lam’s failings and demanded withdrawal of the extradition bill.

Third, China should recognize that its process for selecting Hong Kong’s chief executive is deeply flawed. Lam is politically inept largely because she lacks the nous that every elected politician acquires through the hurly-burly of electioneering.

Mongolia: Bridge or Buffer in Northeast Asia? Reflections from the 6th Ulaanbaatar Dialogue and beyond. -The Diplomat

GLOBAL BUSINESS

Morgan Stanley likely to gain majority control of China securities JV in H2 -Reuters

Chinese envoy says Syngenta takeover was a bad deal Beijing’s ambassador to Switzerland said ChemChina’s $43 billion takeover of seed and agrochemicals firm Syngenta was a mistake, adding he would have tried to stop the 2017 deal had he been in Bern at the time, a newspaper reported in an interview on Saturday. -Reuters

Chinese fret as Samsung, other giants leave Samsung to close key assembly base in Guangdong, while Foxconn may cut production of iPhones -Asia Times

How Wine Became Part of the Trade War China has slapped three rounds of tariffs on American wine in little more than a year, with the latest one coming into effect at the start of June -Bloomberg

ECONOMIC STATECRAFT COMES TO JAPAN Japan restricts tech exports to South Korea over wartime labor row Move risks being seen as backtracking on free trade -Nikkei Asian Review

BUT NOT ECONOMIC DIPLOMACY Japan Is Cool But Has No Clue About Selling Itself The country struggles to make money off of its worldwide cultural cachet. -Bloomberg

Taiwan rejects HK firm's skycraper bid over China 'security concerns' Taiwan has vetoed a $2 billion bid by a Hong Kong-led consortium to build a twin skyscraper in Taipei citing national security concerns, arguing the company is too heavily influenced by mainland China. -Taiwan Focus

India yet to make a call on Huawei Telecom minister has said a committee will assess security factors on whether Chinese firms can take part in 5G networks -Asia Times

Toyota to invest ¥210 billion in Indonesia to develop hybrid cars through 2023 Toyota Motor Corp. will invest about ¥210 billion ($1.9 billion) through 2023 in Indonesia, mainly to develop hybrid cars, people close to the matter said Saturday. -The Japan Times

GLOBAL MACRO

DECOUPLING FROM CHINA: it’s about time After 40 years building up a near-pathological dependence on China, it’s time for US industry to pull back from the People’s Republic of China – even if not a total decoupling. -Asia Times

China's Weak Factory Report Shows Need for Lasting Trade Truce -Bloomberg

How the extradition bill crisis threatens Hong Kong’s currency peg to the US dollar -SCMP

·       The extradition bill risks undermining Hong Kong special status in the eyes of the international community. Any change could lead to a flight of capital, which would in turn threaten the city’s currency

OPIC to double investment in Indonesia over next five years The Overseas Private Investment Corporation (OPIC) is seeking to strengthen its presence in Indonesia by doubling its investment in Southeast Asia's largest economy over the next five years. -Jakarta Post

Việt Nam values partnership with US: spokesperson The spokesperson was answering questions from reporters about Việt Nam’s reaction to US President Donald Trump’s recent negative remarks on Việt Nam-US trade ties. -VNNews

Vietnam and EU sign free trade deal Hailed as a ‘milestone’ by Brussels, agreement will slash duties on almost all goods -Asia Times

Manila grows ever richer despite Duterte bid to boost regions -The Asian Review