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China to hasten financial reforms during 2014

March 11, 2014

~~HONG KONG – HSBC says China's financial reforms are likely to advance faster than many had expected in 2014. People’s Bank of China Governor, Zhou Xiaochuan, today for the first time affirmed that he expects deposit rates to be liberalised within one-to-two years. “China will also accelerate capital account opening-up and allow private commercial banks to be set up,” HSBC says. “We expect this determined push for financial reform to mean a widening of the floating band for deposit rates within 2014, and the introduction of a deposit insurance scheme in the coming months as well.”

Xi stresses rural reform, wants softer approach from officials

March 10, 2014

BEIJING - President Xi Jinping has called for deepened rural reform in China and strictly regulated use of officials' power. “Rural reform should be deepened energetically with the right orientation, and farmers' wishes should be respected,” Xi told a panel discussion of deputies from Anuhi Province attending the National People's Congress from Anhui.

Government says strong second half will secure China’s 7.5% growth target

March 10, 2014

BEIJING – China’s National Development and Reform Commission has affirmed that China will meet its 7.5% growth target as set in the Government Work Report, saying that positive economic factors - including stronger external demand and the dividends of reform - are likely to emerge in the second half of this year.

‘TPP membership would reduce Taiwan’s economic dependence on China’

March 9, 2014

LOS ANGELES - Lin Wuu-long, a former Head of Enterprise Management Research at the United Nations, says Taiwan's move to treat joining the regional economic bloc, the proposed Trans-Pacific Partnership (TPP), as a top priority makes sense because it will help Taiwan improve its international competitiveness - and reduce its economic dependence on China.

Exports plunge as China culls over-invoicing and round-tripping of goods

March 8, 2014

HONG KONG - China’s exports growth crashed in February, dropping by 18.1% on-year compared to a 10.6% gain in January, as China intensified efforts - especially by introducing two-way fluctuation in the RMB exchange rate - to curb suspicious capital inflows embedded into foreign trade via export over-invoicing and round-tripping.

China's first potential onshore bond default to increase funding costs: S&P

March 6, 2014

HONG KONG - The imminent default by Chinese solar-equipment maker Shanghai Chaori Solar Energy Science and Technology Co. (Chaori) is poised to be a transformative event for China's corporate bond market, says ratings agency Standard & Poor's. “We believe the Chinese Government is beginning to address the difficult moral hazard and implicit State guarantee of financially weak and commercially unviable borrowers,” S&P says.

China’s NPC meeting kicks off with 7.5% growth target, emphasizes market-oriented reforms

March 5, 2014

BEIJING - At the opening of the annual National People’s Congress in Beijing, Premier Li Keqiang has presented a “Government Work Report” reviewing economic developments and policy priorities for the coming year. The Report contains China’s official 2014 macro targets, all of which were in line with expectations and essentially unchanged from last year: GDP growth of 7.5%, inflation at 3.5%, M2 growth of 13.0%, and a fiscal deficit of 2.1% of GDP .

Xi urges Shanghai to spearhead reforms, calls FTZ a National Strategy

March 6, 2014

BEIJING - China’s President, Xi Jinping, has encouraged officials to make bold moves in the Shanghai free trade zone (FTZ) and to continue the zone’s leading role in spearheading China’s ongoing reform and opening-up drive. Xi made the remarks while taking part in a panel discussion with a delegation from Shanghai during the annual session of the National People's Congress.

South Korea unveils its own “third arrow” to boost medium-term growth

February 26, 2014

SEOUL - In an announcement reminiscent of Japan’s recent efforts to revive its economy, South Korea’s President, Park Geun-hye, hasy announced a “three-year economic innovation plan” aiming to lift medium-term growth, labour participation, and per capita income. Specific targets include a 4% annual GDP growth rate (compared with 2.8% in 2013), 70% labour participation rate (up from 65% at present), and per capita income of US$40,000 (up from US$28,000 at present).

Australian investment weak as mining investment falls: Big drag in 2014/15?

February 27, 2014

SYDNEY – Australian investment in the fourth quarter of 2013 was weak, down 5.2% on-quarter driven by a fall in mining investment. In a research note, HSBC says investment intentions were also weak, with the first estimates for 2014/15 suggesting a large fall, of 11-25 per cent, is expected as mining investment falls and there is only a modest rise in other sectors is expected.

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