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FOOD, POWER COSTS DRIVE INFLATION IN INDONESIA

March 1, 2013

JAKARTA - Headline inflation in Indonesia came in well above expectations in February, driven by food, but core inflation was stable. Commenting on the results, ANZ Bank says a key risk moving forward is whether food inflation generates second round effects. “Although food prices are typically more a function of supply rather than demand in emerging markets, significant wage rises across Indonesia may motivate local farmers to become price makers rather than takers,” ANZ says.

CHINA ELDERLY TO TOP 200 MILLION IN 2013

March 1, 2013

BEIJING – The China Research Centre on Aging says the number of China’s elderly will reach 202 million in 2013, accounting for 14.8% of the total population. Defined as people over 60 years old, the elderly population has grown by 8.91 million people year-on-year. The announcement increases fears of a shrinking working population and an increasing dependent population, with dependents increasing from 44.62% of the total population in 2012 to 45.94% in 2013.

PRUDENT FISCAL STANCE UNDERPINS HK’s CREDITWORTHINESS: S&P

March 1, 2013

SINGAPORE - Standard & Poor's Ratings Services says Hong Kong's projected budgetary surplus for this fiscal year strengthens the Government's robust fiscal position, which underpins the issuer credit rating (AAA/Stable/A-1+; cnAAA/cnA-1+). The Government estimates the consolidated surplus for fiscal 2012-2013 (ending March) at HK$ 64.9 billion, or 3.2% of GDP. The surplus reflects the resilient earnings and profitability of local enterprises, increased land sales, and lower expenditure than the Government initially projected.

STRUCTURAL SHIFT IN AUSTRALIAN EXPORTS AS ASIA URBANISES: HSBC

March 1, 2013

SYDNEY - The increased urbanisation of Asia over the next 20 years will prompt a shift in the composition of Australia’s exports and trade partners, according to HSBC’s latest trade forecast report, Global Connections. It forecasts that, by 2030, Australia’s exports will shift from industrial commodities, like iron ore – currently used in the first stage of Asia’s industrialisation – to commodities needed to support Asia’s more sophisticated consumer needs like base metals and mineral fuels.

BANK OF CHINA TO OFFER RMB TERM DEPOSITS FOR PARTICIPANT BANKS

March 1, 2013

HONG KONG - The Bank of China (BOC) Hong Kong and The Bank of China Taipei branch, the official RMB clearing banks in Hong Kong and Taiwan, today (March 1) began offering RMB term deposits for participant banks. Notably, the interest rates offered for term deposits by BOC HK are lower than those for Bank of China’s Taipei branch. At the same time, the clearing bank has also raised the overnight deposit rate for participant banks in Hong Kong to 0.648%, from 0.629% previously. The overnight rate in Hong Kong is now level with Taiwan’s overnight rate.

AUST. MINER ACQUIRES 30% OF INDONESIAN THERMAL COAL MINE

March 1, 2013

BRISBANE – Listed Australian firm Altura Mining Limited (ASX: AJM) has acquired a one-third equity stake in an operating coal mine in East Kalimantan, Indonesia for US$25 million. The investment signifies a change from explorer to producer for Altura, which plans further coal mine developments in Indonesia. The transaction provides a direct equity interest in PT Delta Ultima Coal (Delta Coal), the owner and operator of the PT Binamitra Sumberarta mining tenement, which produces and sells a medium energy thermal coal currently at a rate of 1.5 mtpa.

INDIA’S FY14 BUDGET SEEN AS CREDIBLE AND PRAGMATIC

February 28, 2013

NEW DELHI - India's new budget for FY14 (year ending March 2014), presented today, delivers on three counts, according to an analysis by BBVA Bank: 1) it delivered a credible fiscal consolidation path; 2) it focussed on the quality of deficit reduction; and 3) it balanced austerity with populism without undermining economic growth. The Government said the FY13 fiscal deficit was within the targeted 5.3% of GDP (at 5.2%), with a promise to reduce the deficit to 4.8% of GDP in FY14 and to 3.0% by FY17.

TOUGH 12 MONTHS AHEAD FOR INDIA’S BANKS: S&P

February 26, 2013

MUMBAI - The troubles for the Indian banking system are likely to increase in the next 12 months due to slow economic growth and sluggish fiscal reforms. However, the situation is likely to improve in the fiscal year ending March 31, 2015, according to ratings agency Standard & Poor's. The report notes that the performances of both the Indian economy and the corporate sector are likely to start improving in fiscal 2014.

TAIWAN LEADER MOOTS POLITICAL CONTACTS ON CROSS-STRAIT ISSUES

February 26, 2013

BEIJING - Political contacts across the Taiwan Strait "should be given a proper level of attention" to come to grips with the thorny issue of "one China", according to Lien Chan, an honorary chairman of Taiwan's ruling Kuomintang. Speaking to reporters after meeting with China's top leader, Xi Jinping, in Beijing, Lien said the two sides can start with experts and non-governmental organisations such as think tanks to tackle more difficult political issues.

BEIJING, MOSCOW EDGE TOWARDS MAJOR DEAL ON GAS SUPPLY

February 26, 2013

BEIJING - Russia is set to supply China with natural gas in a strategic deal reached by the Vice-Presidents of the two countries. Russia agreed to provide an annual supply of 38 billion cu m of natural gas through an eastern pipeline to China. The deal builds on a framework agreement from 2009 where Russia agreed to deliver 70 billion cu m annually for 30 years, starting in 2014. China consumes roughly 145 billion cu m of natural gas, and will import 78.5 billion cu m by 2014. The announcement comes a few weeks before Xi Jinping’s scheduled state visit to Moscow.

CHINA ELDERLY TO TOP 200 MILLION IN 2013

March 1, 2013

BEIJING – The China Research Centre on Aging says the number of China’s elderly will reach 202 million in 2013, accounting for 14.8% of the total population. Defined as people over 60 years old, the elderly population has grown by 8.91 million people year-on-year. The announcement increases fears of a shrinking working population and an increasing dependent population, with dependents increasing from 44.62% of the total population in 2012 to 45.94% in 2013.

AGUS MARTOWARDOJO NOMINATED AS INDONESIA’S CENTRAL BANK CHIEF

February 25, 2013

JAKARTA - President Susilo Yudhoyono is to nominate Agus Martowardojo, the current Minister of Finance, as Bank Indonesia’s next Governor, replacing Darmin Nasution, whose term expires in May. The nomination is subject to Parliamentary approval (Agus was turned down by Parliament for the post once before, in 2008), and raises questions about his replacement at the Ministry of Finance.

CHINA GROWTH IN 2013 TIPPED TO REACH 8.23% WITH IMPORTS UP 18%

February 25, 2013

BEIJING - Economic growth in China is expected to increase by 0.43% from 2012 to reach 8.23% in 2013 according to Xiamen University and the Economic Information Daily, a subsidiary of Xinhua. Their report says 2013 export growth should increase almost 5% to 12%. Import growth is also due to increase, from just 4% last year to almost 18% this year. Inflation is predicted at 3.11%, up from 2.6% last year. The report is in line with Government projections, but analysts at Nomura argue that 8.23% is too high an expectation, indicating a figure around 7.7% is more likely.

FORMER VICE-PRESIDENT TIPS 4% GROWTH FOR TAIWAN

February 25, 2013

TAIPEI - Taiwan's economic growth could increase to more than 4% in 2013 if more emphasis was placed on investment and consumption, according to former Vice President Vincent Siew. He believes the economy can perform better than the Government's forecast of 3.59% growth – which compares with just 1.26% in 2012. Siew said he had seen an increase in investment activities in the private sector, and that this will be followed by an uptick in consumption. The former Economics Minister said Taiwan's finance industry should be expanded to contribute more to GDP.

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