APAC MONDAYS

APAC Mondays 2018(1).png

GEOPOLITICAL RISK+GLOBAL MARKETS

APAC MARKETS - IMPACT + OPPORTUNITY

The Looming Taiwan Crisis For many years, US policymakers worried that Taiwan would upset the apple cart: not content with the mere trappings of independence, it would opt for the real thing – an unacceptable outcome for the mainland. Now, however, the balancing act is threatened by both China and the US. -Project Syndicate

Greater Bay Area is a chance for Hong Kong to show it hasn’t lost its edge -SCMP

·        If Hong Kong is to capitalise on China’s development plan for the Pearl River Delta, the government must engage with sectors in which the city excels, such as universities and the maritime industry, to boost areas of specialization

Hong Kong Identity and the Rise of Mandarin Yet even though Cantonese is not in any danger of disappearing in Hong Kong, this issue resonates with the people of Hong Kong. The growing use of Mandarin is a reminder that that they are not independent, and China is slowly starting to integrate Hong Kong back into the mainland. That’s a difficult reality for many Hong Kong citizens who see themselves culturally and, indeed, linguistically different. All physical and diplomatic barriers between Hong Kong and China are set to expire July 1, 2047; the one barrier that may not fall by then is the language barrier. -The Diplomat

 GLOBAL BUSINESS

Pence sharpens Huawei criticism in Munich security speech Chinese supplier poses risk to telecom infrastructure, US vice president says -Nikkei

China to lure foreign investment in state giants -Reuters

Private and foreign firms should “actively participate in reform and development of central enterprises, and jointly explore ways of deep cooperation including mixed-ownership”, Xiao Yaqing, chairman of the State-Owned Assets Supervision and Administration Commission (SASAC)

Rising protectionism, concerns about technology’s reach are politicising, delaying merger reviews, lawyers say -SCMP

·        About 60 per cent of the G20 are considering expanding reviews of foreign investment

·        US-China trade war has added complexity to deals

Remember that ‘Chinese boycott’ of Canada Goose down jackets because of Meng Wanzhou? Revenue numbers show it didn’t happen, with sales rising, and forecasts up -SCMP

·        Despite a December call for Chinese buyers to spurn Canada Goose after the arrest of Huawei’s CFO in Vancouver, sales climbed 50 per cent in Q4 2018

·        Revenue forecasts have been increased compared to November’s predictions – but Canada Goose stock tanked on Thursday on the back of weak US retail data

Didi targets new South American markets Chinese ride-hailing giant Didi Chuxing is planning to take on US rival Uber in some of Latin America’s fastest-growing markets, recruiting managers in Chile, Peru, and Colombia, according to job postings and a company official. -Tech-in-Asia

PODCAST OF THE WEEK The Real Reason Uber is Failing in Japan Uber and, to a lesser extent, Airbnb are failing horribly in Japan. In fact, the very thing that makes these companies powerful and transformative in the United States is what ensures they will never really succeed in Japan. -Disrupting Japan

Tighten rules on data privacy The law on protecting personal information, which prohibits businesses from releasing private information on their customers to third parties without the consent of the individuals, makes an exception for police requests for such data in criminal investigations. -The Japan Times

India Proposes Chinese-Style Internet Censorship Under the proposed rules, Indian officials could demand that Facebook, Google, Twitter, TikTok and others remove posts or videos that they deem libelous, invasive of privacy, hateful or deceptive. Internet companies would also have to build automated screening tools to block Indians from seeing “unlawful information or content.” Another provision would weaken the privacy protections of messaging services like WhatsApp so that the authorities could trace messages back to their original senders. -NYT

IN Ikea woos India's rising consumer class, tapping new markets This is the competition Swedish giant Ikea faces in tackling the $40 billion Indian market for home furnishings, which is growing quickly along with the country’s consumer class. -The Japan Times

Taiwanese tech firms must avoid China trap These developments are a reminder that while Taiwan’s technology sector has traditionally enjoyed a close relationship its US counterpart, a number of Taiwanese companies are heavily reliant on Chinese investment and its production supply chain. Caught in the middle of the US-China trade dispute, Taiwanese technology companies and key people in research and development must maintain a high level of vigilance to avoid becoming sacrificial pawns in this high-stakes game. -Taipei Times

Singapore transport authority suspends Ofo’s bike-sharing license -Tech-in-Asia

Firm to invest $200m in VSIP Nghệ An A Singaporean company will invest in a textile project in the Việt Nam-Singapore Industrial Park in Nghệ An Province (VSIP Nghệ An). -VNews

iPhone manufacturer Pegatron to start operating in Batam in April A trade war between the United States and China prompted the company to leave the latter and enter ASEAN countries, including Indonesia. In December, it announced its partnership contract with Batam-based listed electronics manufacturer PT Sat Nusapersada for the purpose of assembling various electronic products to be exported to the US. -The Jakarta Post

GLOBAL MACRO

Chinese companies stung as dollar fundraising costs soar Rampant defaults in country spur interest rate hikes on greenback debts -Nikkei

South Korean blue chips bruised by Chinese slump Profit down 23% at big exporters as Moon rushes to nurture startups -Nikkei

VN Gov’t did not intervene in domestic carbon steel prices There was not enough evidence to say that the Vietnamese Government intervened in the domestic prices of the carbon steel welded pipe industry, according to the final determination by the Canada Border Services Agency (CBSA). -VNews

Australia targets March signing of stalled Indonesia trade deal Australia said Friday a long-awaited trade deal with Indonesia will be signed in March, following months of diplomatic tension over Canberra's contentious plan to move its embassy to Jerusalem. -The Jakarta Post