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China August FDI inflows disappoint, but remain robust for the year

September 17, 2013

HONG KONG - FDI inflows were almost flat in August compared to a year ago (0.6% y/y vs. consensus: 12.5% y/y). The data come after a sizable jump in the previous two months (21.7% y/y in June-July), and the inflows have been resilient year-to-date (+6.4% vs. -3.7% for the full year of 2012). Inflows have grown most notably in the services sector (up 13.5% ytd y/y), and remained sluggish in manufacturing (-3.3% ytd y/y).

Taiwan wins invitation to ICAO meeting in Montreal

September 17, 2013

TAIPEI – Taiwan appears to have has a breakthrough in its long campaign for official representation at meetings of the International Civil Aviation Organisation (ICAO), with Shen Chi, Director-General of Taiwan’s Civil Aeronautics Administration, invited to lead a delegation to ICAO’s 38th assembly in Montreal starting on September 24. Taiwan has not been invited to an ICAO meeting since its lost its seat to the United Nations 42 years ago.

Singapore’s non-oil domestic exports surprise on downside

September 17, 2013

SINGAPORE - Singapore’s August non-oil domestic exports fell 6.2% y/y, surprising markets. ANZ Bank says the contrast between Singapore’s non-oil domestic export (NODX) and re-export (NORX) growth signals that external demand conditions in the region remain on an improving trend, but domestically-produced exports in Singapore are not benefitting, yet.

EIU drops 2013 growth forecast for India to 5%, holds to 7.5% for China

September 18, 2013

LONDON – In an update of its Global Forecast, the Economist Intelligence Unit has again lowered its 2013 GDP forecast for India, from 5.5% to 5.0%. It is maintaining its 2013 GDP forecast for China at 7.5%, but says this will slip to 7.3% in 2014 and eventually to 6.3% in 2017 as China’s economy continues to mature.

Shanghai Free Trade Zone expected to be launched on September 29

September 16, 2013

BEIJING - Shanghai is expected to launch its trial free trade zone around September 29. The zone will offer relaxed restrictions on the capital account and free convertibility of the currency, as well as liberalised foreign exchange. Regulatory details for the zone are still being finalised, but the plan will likely offer foreign companies additional opportunities in industries such as banking and health insurance, while blocking investment in others.

China announces tough clean air action plan to reduce pollution

September 14, 2013

BEIJING – China’s State Council has released its toughest action plan yet to reduce pollution, requiring that the concentration of breathable suspended particles with a diameter of 10 microns or less must fall by at least 10% compared to 2012 in 338 specified cities by 2017. Stricter objectives have been set for areas including Beijing, which must reduce the concentration of PM 2.5, smaller more dangerous particles, by about 25% by 2017, based on 2012 levels.

Interest rate hike in Indonesia underscores divergence with the Philippines

September 13, 2013

JAKARTA - At its monthly policy meeting, Bank Indonesia has unexpectedly hiked interest rates for a fourth time since June, bringing the benchmark policy rate to 7.25%, a cumulative increase of 150 basis points since June. The move was in response to high inflation (8.8% in August, well above the official target of 3.5-5.5%) and downward currency pressures - the rupiah has depreciated against the US dollar by 15% since early June, although stabilising in recent days at around 11,000 per US$.

Improving investment leads to upward revision to Japan’s Q2 GDP

September 13, 2013

TOKYO – Japan’s Q2 GDP has been revised upwards to 3.8% saar (0.9% q/q sa) from the preliminary reading of 2.6% saar (0.6% q/q sa), as capital spending, the missing ingredient until now in Japan’s economic revival, posted a strong increase. In particular, private non-residential investment growth was revised up to 1.3% q/q sa in Q2 from a preliminary reading of -0.1%, and public investment growth was revised up to 3.0% q/q sa (1st preliminary reading: 1.8%).

Bouyant FDI supporting economic recovery in Vietnam

September 12, 2013

HO CHI MINHI CITY - Buoyant FDI continues to support recovery. As of August 20, registered FDI reached US$12.6 billion, soaring 19.5% from a year earlier. This was backed by 768 new projects mostly focussing on the manufacturing sector. Meanwhile, FDI disbursements edged up 3.8% y-o-y to US$ 7.6 billion, and became a key factor contributing to a marked improvements in production activity.

Citi partners with InvestPenang to promote treasury management operations

September 11, 2013

PENANG: Citi is teaming up with InvestPenang to promote Penang and Malaysia as a strategic centre for treasury management activities. The Government-private sector pro-business collaboration aims to encourage foreign and local companies in the technology industry to centralize or consolidate their regional or global treasury management operations in Malaysia.

China’s August data beats expectations, adds evidence of recovery

September 12, 2013

HONG KONG - Upside surprises in August data releases suggest that China’s economy is bottoming out. Industrial production and retail sales growth was stronger than expected, reflective of the impact of Beijing's mini stimulus. Investment growth picked up on the back of accelerating infrastructure investment and rebounding manufacturing investment. HSBC says that, coupled with the recent improvement in China's PMIs, the fresh data implies that growth will likely stay above 7.5% in coming quarters.

Taiwan commits to purchase US$4 billion of US grain over two years

September 11, 2013

WASHINGTON - The Taiwan Feed Industry Association on behalf of the Taiwanese Agricultural Goodwill Mission HAS signed a letter of intent with the US Grains Council committing to the purchase five million metric tonnes (197 million bushels) of US corn in 2014 and 2015. In addition, 0.5 million tonnes of distiller’s dried grains with solubles (DDGS) will be included in the memorandum.

China’s August CPI growth slows to 2.6%, producer price index still negative

September 11, 2013

BEIJING – China’s consumer price index rose 2.6% in August, down from 2.7% in July, while the producer price index, another indicator measuring inflation at the wholesale level, remained in negative at -1.6%, compared with -2.3% in the previous month, according to data from the National Statistics Bureau. PPI inflation showed a significant rebound, but remained negative for the 18th consecutive month, suggesting that demand remains sluggish. The increase in CPI is partially due to adverse weather conditions this summer which drove up food prices, including floods and severe drought.