INDIA
Modi hails new FDI rules
Prime Minister Narendra Modi yesterday hailed a sweeping liberalization of rules on foreign direct investment (FDI), saying they would make Asia’s third-largest economy the most open in the world. “Key reform decisions were taken at a high-level meeting chaired by the prime minister, which makes India the most open economy in the world for FDI,” Modi said in a tweet. In a second tweet, he said the changes would provide a “major impetus to employment and job creation in India.”
THAILAND
Surplus soars to new heights
The Southeast Asian nation — best known for its beaches, food, military coups and, more recently, the soccer heroes Leicester City — has run up the biggest current-account surplus among major emerging markets. The current-account surplus in the first quarter ballooned to an annualized 10.2 percent of GDP, an improvement that is described as phenomenal. Much of the buffer is down to a steep fall in oil prices — Thailand relies on crude imports for more than 80 percent of its energy needs — and a surge in tourism fueled by Chinese shoppers. Thailand has been using the windfall to replenish its foreign-exchange reserves by about US$20 billion this year, providing a key bulwark if it faces a sudden surge in capital outflows or foreign-exchange market volatility. The increase in reserves has been the fastest of any emerging market. The current-account data also reflects a reluctance by companies and households to spend the dividend from cheaper energy, indicating a deeper malaise in the economy. Savings rates soared to 33 percent of GDP in the first quarter, while investment has slid.
HONG KONG
Brexit fears abate
Stocks in the territory yesterday jumped nearly 2 percent, their biggest one-day gain in almost a month, as Asian markets rebounded on hopes Britain would decide to remain in the EU. The Hang Seng Index rose 1.7 percent, to 20,510.20, while the China Enterprises Index gained 1.8 percent, to 8,639.51 points. Brexit fears abated as three British opinion polls ahead of the EU membership referendum on Thursday showed the “Remain” camp recovering some momentum, although the overall picture remained one of an evenly split electorate. Most Hong Kong sectors rose, with financials and energy shares leading the gains. Stella International Holdings shares tumbled for a second session, after last week’s warning of a significant drop in first-half profit.
CHINA
Banks buy more forwards
The country’s banks last month bought more foreign-currency forwards than they sold for the first time in 17 months, signaling lenders’ clients have turned more optimistic on the yuan as capital outflows abated. Banks bought a net 8.6 billion yuan (US$1.3 billion) of forwards from customers last month, the State Administration of Foreign Exchange said in a statement posted on its Web site yesterday. That compares with record net selling of 428.4 billion yuan in August last year, when policymakers devalued the currency, and is the first time the figure turned positive since December 2014. The change comes after the pace of capital outflows from China slowed to an estimated US$43 billion in April, the least since last June, according to Bloomberg Intelligence.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last