BEIJING - Liu Jiayi, Auditor-General of the National Audit Office (NAO), has warned the Standing Committee of the National People's Congress (NPC) of risks threatening economic development, calling for better management of finances and State-owned assets, as well as the sound implementation of macro-economic policies. Liu emphasised growing Government debt as an issue, with debts owed by provincial-level governments rising sharply to RMB3.85 trillion in 2012, according to an NAO report submitted to the NPC. Large Government debts will affect economic growth, a major reason why many banks have cut growth estimates for the nation this year from 8% to below 7.5% on average.
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BEIJING – China has announced the appointment of Ding Xuedong as the new Chairman of the China Investment Corp (CIC), China’s sovereign wealth fund with assets worth US$480 billion. Ding is currently Deputy Secretary-General of the State Council and was previously Vice Finance Minister from 2008 to 2010. The position has been vacant since former Chairman, Lou Jiwei, was promoted to Finance Minister in March.
HANOI - The State Bank of Vietnam (SBV) has cut its deposit rate for US dollar accounts effective June 28, and has announced a 1% devaluation in the VND to 21246/USD from 20828/USD.. Corporate deposit rates have been cut by 25 basis points to 0.25%, from 0.5% across all tenors, while individual deposit rates have been cut by 75 basis points to 1.25%, down from 2.00%.
NEW DELHI -Tech Mahindra Limited, a specialist provider of information technology solutions and services to the telecommunications industry, and Mahindra Satyam, a leading global consulting and IT services provider, have formally amalgamated. Tech Mahindra is one of the top 5 Indian IT services companies and the merged entity creates a technology services powerhouse, with revenue of US$2.7 billion and a team of 84,000 professionals servicing 540 customers across 46 countries. The brand dons a new look and logo.
SINGAPORE - Industrial production here was considerably stronger in May than the market expected, and grew sequentially for the third consecutive month. IP rose by 1.2% month-on-month from an upwardly-revised 3.6% in April. On a year-on-year basis, growth was 2.1% compared to 5.0% in March (Figure 2). ANZ Bank comments that industrial production in Singapore is signalling a rebound in GDP growth. “IP is the best single proxy indicator of GDP growth in Singapore,” says ANZ. “Using April and May IP data, initial estimates put GDP in Q2 at 2-2.5% q/q sa, from 0.4% in Q1.
HONG KONG - After allowing an interbank cash squeeze to intensify since June 6, the People’s Bank of China (PBoC) on Tuesday signalled a readiness to provide liquidity to stabilise the market. The announcement came as welcome news to China’s equity market, which had fallen by almost 20% since end-May on worries of slowing growth and, more recently, the impact of the intensifying cash squeeze on economic activity and bank profits. While still elevated, interbank interest rates have eased in the past two days and the equity market has stabilised, says BBVA Bank.
SAINT PETERSBURG - Natural gas will continue to increase its share of the global energy mix, growing at 2.4% per year between now and 2018, according to a new International Energy Agency report published today. However, this projected growth rate is lower than the IEA’s forecast last year of 2.7%, due to persistent demand weakness in Europe as well as difficulties in upstream production growth in the Middle East and Africa.
HONG KONG – The HSBC Flash China Manufacturing PMI Index hit a nine-month low in June as output and new orders both fell. The Manufacturing PMI was at 48.3 (49.2 in May) and the Manufacturing PMI at 48.8 (50.7 in May).
JAKARTA - Indonesia’s legislature yesterday approved revisions to the 2013 budget that would clear the way for President Yudhoyono’s government to raise fuel prices and cut the subsidy bill. A fuel price increase – the first since 2008 – has been on the table since last year when it was unexpectedly delayed due to political resistance. The price hike could take effect in the coming days, resulting in a 44% increase in low-octane gasoline and 22% increase in diesel.
BEIJING - Sinopec Group, China’s largest State-owned oil exploration enterprise, has confirmed it is in talks with Iceland over oil exploration in Iceland’s coastal waters. The talks involve Sinopec Star Petroleum Co Ltd, a clean energy subsidiary wholly-owned by the group, which has signed an agreement with the Icelandic company Orka Energy Holding. CNOOC Ltd, the biggest offshore oil producer in China, has already signed an agreement separately with Iceland-based Eykon Energy to bid for an exploration license.
BEIJING - Following trends in China’s over-ground railway system Beijing’s underground subway has become the first in China to open up to private investment. Beijing’s subway lines 4 and 14 have previously had limited private investment, and the Government is looking to private investment for future planned subway lines in the capital, according to the National Development and Reform Commission (NDRC).
BEIJING - The Chinese Government says it will scrap a decade-long iron ore import licensing system that should see an increase in iron ore imports and improve access to raw materials for small and medium enterprises. Iron ore traders will now need only the same routine licenses that are issued to other importers and will no longer need approval by government-backed industry bodies such as the China Iron and Steel Association.
TAIPEI - Taiwan hopes to take part in more international affairs and become further integrated in the regional economy, ruling Kuomintang (KMT) Honorary Chairman, Wu Poh-hsiung, has told Chinese leader Xi Jinping at a meeting in Beijing. China was urged to fully understand Taiwan's bid to broaden its international space by actively participating in international affairs, Wu said at the high-level meeting, the first of its kind since Xi took the helm of the Communist Party of China (CPC) in November.
JAKARTA - In contrast to policy easing by other central banks in the past month (Australia, Korea, Thailand, and India), Bank Indonesia has raised its benchmark interest rate by 25 bps to 6.0%. The move follows a surprise 25bp hike in the overnight deposit rate (FASBI) announced last Tuesday, and marks the first rate move in more than a year, since BI cut rates to a record low in February 2012.
JAKARTA - Fitch ratings has raised India's outlook to stable from negative while affirming its BBB- credit rating (one notch above investment grade). Fitch said it in part based its decision on the improvement to its outlook on India’s fiscal consolidation measures and progress in addressing structural hurdles to investment).
CANBERRA – The Australian software maker Intelledox has signed strategic customers and channel partners in Singapore as it strengthens its focus on Asia. To drive growth in the region, Intelledox has appointed Jefrey Ng as Sales Director and Zac Leow as Technical Lead based out of its Singapore office. Intelledox delivers enterprise software solutions to a portfolio of large corporates and government organisations. www.intelledox.com (ATI).