APAC MONDAYS

GEOPOLITICAL RISK+GLOBAL MARKETS

APAC MARKETS | IMPACT + OPPORTUNITY

Seven Key Issues to Determine Success of U.S.-China Trade Talks -Bloomberg

1. Intellectual Property

2. Huawei and 5G

3. Made in China 2025

4. Energy

5. Agricultural imports

6. Auto tariffs

7. Market access for banks

The uniting powers of Northeast Asia may be a counterweight to the might of the United States of America -SCMP

  • The crowning achievement for Sino-Japan relations would be a trade agreement between the world’s second and third-biggest economies, plus South Korea

GLOBAL BUSINESS

The U.S.’s Star Witness in the Qualcomm Antitrust Suit: China's Huawei Two of the U.S. Federal Trade Commission’s biggest witnesses in the opening day of its trial against Qualcomm Inc. for allegedly harming competition for smartphone components were Chinese companies. -Bloomberg

Chinese developer Evergrande tightens belt after a decade of audacity Humbled property giant struggles to find new funding and growth engine -Nikkei

AUTARKY DOESN’T WORK Taiwan chipmaker UMC's pullback hurts China self-sufficiency plans Beijing's dream of mass-producing semiconductors still reliant on outside help Chinese President Xi Jinping's campaign to foster a self-reliant semiconductor industry has hit another obstacle as Taiwanese chipmaker United Microelectronics Corp. scales back cooperation with a Beijing-backed partner over tensions with the U.S. -Nikkei

Bipartisan bill unveiled in Senate to stop China tech threats The bill aims to create the Office of Critical Technologies and Security to coordinate an inter-agency strategy to fight high-tech threats to national security posed by China and other foreign actors, they said in a press statement. -Reuters

Year of decision for Trump and Xi on Taiwan Of the many foreign policy challenges confronting President Trump in 2019, ensuring the democratic security of Taiwan may prove as daunting, and as dangerous, as resolving the North Korea nuclear crisis. -The Hill

Deals with China have baggage Given the economic downturn in China and the security concerns raised worldwide over Chinese investment, it would seem counterintuitive for Taiwanese politicians to seek closer economic exchanges with China, especially given that those security concerns are higher in Taiwan than they are elsewhere. -Taipei Times

Taiwan negotiating with Japan on 'acceptable' solution to food ban President Tsai Ing-wen has said that her government is seeking an “acceptable” solution to the thorny issue of the island’s import ban on Japanese food products imposed after the 2011 nuclear disaster. -The Japan Times

HISTORY IMPACTS THE BOTTOM LINE TOO South Koreans seek Nippon Steel asset seizure in 'forced labor' case South Korean plaintiffs in a World War Two forced labor court case against Japan’s Nippon Steel & Sumitomo Metal Corp have applied to seize some of Nippon Steel’s Korean assets, their lawyers said on Wednesday. -Reuters

GLOBAL MACRO

China Has a Dangerous Dollar Debt Addiction With $1.2 trillion needing to be rolled over this year, the threat of a funding crunch is rising. -Bloomberg

A Makeover for Chinese Macroeconomic Policy While China is not about to recapture double-digit GDP growth, that does not imply economic catastrophe. After four decades of rapid growth, a slowdown was inevitable, and if China readjusts its macroeconomic policy stance, it can prevent that slowdown from being excessively sharp. -Project Syndicate

After Chinese stocks end another year as worst performers globally, mainland investors eye Hong Kong market -SCMP

  • For Hong Kong investors, stocks listed in the city remain top investment choice, according to Hong Kong Investment Funds Association survey

  • Hong Kong respondents allocated only 19 per cent of their assets for offshore investment, including 8 per cent for mainland China markets, in 2018

Yen's surge is a red flag for world markets Historically, outsized yen gains in short periods, such as the Russian default in 1998 and the global market meltdown in 2008, are a harbinger of stress for global markets. Market watchers say the yen’s latest ascent is a sign that the global economy is set for a rocky ride ahead. -Reuters

Japan approves 126 measures to attract more foreign workers New 'multicultural information' centers will help newcomers in 11 languages -Nikkei

QUO VADIS, Indonesian tax reform? The presidential election is just a few months from now, but clarity is still missing on the direction of the second tax reform. Neither the incumbent nor his challenger has a mature plan regarding the tax reform proposal that has been with the House of Representatives since 2016. -Jakarta Post

As if a weakening economy was not enough, election uncertainty piles further pressure on Philippine peso -SCMP

  • Traders set to drive Philippine peso below 13-year low set in October

  • The peso will drop about 2.5pc to 54 per US dollar by the year-end, making it the third-worst currency in the region after the Indonesian rupiah and Thai baht, finds survey