Macau Business Daily, Mar 19, 2014

Year II

Number 499 Wednesday March 19, 2014

Publisher: Paulo A. Azevedo

MOP 6.00

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Friday April 19, 2013

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eijing’s anti-graft body has announced that it will keep watch on central government’s liaison offices in Macau and Hong Kong. A move that has caught analysts by surprise.

Helping tackle corruption or just deterring mainland officials from gambling are two possible explanations.

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We’re watching! www.macaubusinessdaily.com

‘Authentic hell’

The buses are late and taxi drivers are selective.

Public transport queues are getting longer and quality of service is going out the window. So say residents and visitors to the city in a straw poll taken by Business Daily, and reinforced by a Transport Bureau survey just released.

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4&5

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Macau junkets check in with Ritz Club London Page 7

Show me the money

Brought to you by

A local shop manager can get MOP40,000 in basic salary, higher than Hong Kong. The pay in retailing will continue to grow in the next two years, according to the latest Links International salary index.

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Ambrose So comments on SJM’s 2nd place market share

HSI - Movers March 18

Name

6

%Day

Tencent Holdings

5.76

China Resources Po

4.45

New World Develop

2.05

China Life Insuranc

1.47

Lenovo Group Ltd

1.45

Sands China Ltd

-1.37

Want Want China H

-1.57

Hengan Internatio

-1.82

China Merchants H

-2.94

Belle International

-3.63

Source: Bloomberg

Big is best

SK bets on Caesars

Hong Kong heavyweight builders are having the time of their lives with construction projects in Cotai. Listed companies such as Hsin Chong Construction Group and China State Construction International report healthy profits.

Caesars Entertainment Corp made a mistake by not entering Macau. Now, the American gaming giant doesn’t want to repeat the same mistake, and has got its foot in Korea. A venture with Lippo Ltd will enable a casino resort on Yeongjong Island, 50 km away from Seoul.

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China slows down house prices Price growth has slowed in China, dragged down by first-tier cities and tighter credit. The main objective is to control undue borrowing, and individual city measures to curb property prices.

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Macau crime

Big money, big threat Mrs Kwok, an unemployed Macau resident, subjected to death threats by five men Pierre-François Métayer

pf.metayer@macaubusinessdaily.com

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few days ago, Mrs Kwok and a group of men, all from Guangzhou and also unemployed, participated in an illegal gaming activity (under the table straddle bets) in a casino. The victim, Mrs Kwok, was also an intermediary between her group and the other players that they were gambling against. After a while, the five men and Mrs Kwok (playing on their side) lost it all…leaving them HK$4 million in the hole. Unhappy about the game’s overall process and course of events, they obliged the victim to accept the entire responsibility for their loss and to reimburse the money as she was the one who introduced them to the game.

On the evening of 15th March, the same group found Mrs Kwok in the VIP corner of a casino in the central district. They surrounded her and threatened her life, saying that if she didn’t return the cash and accept responsibility they would call for backup from the mainland and have her killed. Terrified, the victim reported the case to police and five men were arrested inside the casino for death menaces, a crime punishable by three years in prison. The five men are now in custody, while other suspects involved remain at large. The threat case is now being handled by the Public Prosecutor’s Office while the illegal gambling case is being followed up as well.

Big brother is now really watching Beijing’s anti-graft body now keeps eye on Liaison Office Tony Lai

tony.lai@macaubusinessdaily.com

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he Central Commission for Discipline Inspection, the central government’s anticorruption arm, has announced that it will keep watch on the central government’s liaison offices in Macau and Hong Kong.

Political analysts say the announcement may indicate that Beijing is serious about cracking down on corruption, but that it may also be just a gesture, meant to deter mainland officials from gambling in Macau.

An announcement of changes in the commission posted on its website this week shows its eighth discipline division will now keep an eye on the Liaison Office of the Central People’s Government in Macau and the Liaison Office of the Central People’s Government in Hong Kong.

The website offers no explanation of this change.

“This shows the central government wants to strengthen its efforts to crack down on corruption,” said the head of the University of Macau’s department of government and public

administration, Wang Jianwei.

“In the past some may have thought mainland officials in Macau and Hong Kong were under less scrutiny than officials in the mainland.”

The China News Service quoted a professor at the state-run Chinese Academy of Governance, Wang Yukai, as saying the change makes the commission’s reach “more comprehensive”.

Harbours for corruption Mr Wang said: “Many state-owned enterprises have subsidiaries in Hong Kong and Macau, and they have intricate connections with the liaison offices in Hong Kong and Macau,” he told the agency.

He said Beijing needed to keep a closer eye on mainland officials here and in Hong Kong.

“The liaison offices could become harbours for corruption,” he said.

The central government has repeatedly said since President Xi Jinping took office a year ago that it

Rubber cheque A Fall from grace Liaison Office of the Central People’s Government in Macau

shareholder in a junket operation, Mr Cheong, aged 40+ and a Macau resident, was arrested on Monday at the Macau ferry terminal as he was trying to leave the city (for the first time). A report was filed with police on February 2013 by a casino representative in Cotai claiming that two cheques totalling HK$ 3.9 million signed by Mr Cheong were non-cashable. In 2012, Mr Cheong requested a loan from the concerned casino for gambling purposes, lost everything and was requested to reimburse the company.

Since the middle of the year, nine cheques had been submitted by Mr Cheung. Seven cheques totalled a value of HK$5 million but the last two bounced. Mr Cheong admitted the facts to Judiciary Police and explained that he was simply…”bankrupt”.

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ecently convicted of corruption and money-laundering by a Macau court, disgraced Hong Kong businessman Steven Lo Kit-sing faces even more acrimony. Despite his pleas of innocence, the Hong Kong Football Association, of which Lo is one of two vice-chairmen, and the Hong Kong Jockey Club, of which he is a member, are reserving the right to expel him, according to South China Morning Post. Lo vehemently denied wrongdoing in a written statement but declined to take questions from the media.

will clamp down on corruption.

The official news agency, Xinhua, quoted Premier Li Keqiang as saying this month that the central government would have “zero tolerance” of corruption.

Business Daily asked the Macau liaison office to comment, but we had received no reply by the time we went to press.

An assistant professor of public administration at the Macau University of Science and Technology, Camões Tam Chi Keong, said the purpose of the announcement was more symbolic than practical.

“Beijing always keeps a close eye on the liaison offices in the two special administrative regions, but there was just no official acknowledgement,” he said.

“So this high-profile announcement is more like a signal to warn officials not to mess around in Macau and Hong Kong.”

Stricter vetting Mr Wang also said the announcement served as a signal warning mainland officials against gambling in Macau.

He said that for some time Beijing had been monitoring more closely than before visits to Macau by important officials from the mainland.

“Some mainland academics also face having to wait longer – undergoing stricter vetting – to get permission to visit Macau and Hong Kong,” he said.

Beijing has said its crackdown on corruption is not meant to curb the boom in gaming in Macau.

The director of the liaison office here, Li Gang, has been a member of the Central Commission for Discipline Inspection since 2012.

“My role as a commission member is to take part in anti-corruption work in mainland China, and that has nothing to do with the local gaming industry,” Mr Li said in January, the month he took over the liaison office.

But he added: “Not only I, but also every other official of the liaison office has the responsibility to stop officials from gambling here, just as other law enforcement units in the mainland should.”

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Macau

Trailing SJM goes in search of greater efficiency SJM Holdings chief executive plays down his company’s loss of its leading position in the casino market Stephanie Lai

sw.lai@macaubusinessdaily.com

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JM Holdings Ltd seems unconcerned about losing leadership of the casino market to Sands China Ltd last month, but says it will try to become more efficient.

Official data show Sands China Ltd had 25 percent of Macau’s gaming revenue last month. SJM Holdings, previously the market leader, had 22 percent. Gaming analysts say this month might see SJM fall to third, being overtaken by Galaxy Entertainment.

Gaming revenue amounted to 38.00 billion patacas (US$4.75 billion) last month, 40.3 percent more than a year earlier.

Stockbroker Wells Fargo forecasts that this month Sands China will have 22.2 percent of gaming revenue and Galaxy Entertainment Group Ltd will have 21.6 percent, leaving SJM

Holdings, founded by casino mogul Stanley Ho Hung Sun, in third place.

“Market share is not something that we have to definitely chase, and I think the development of the market will take its own course,” SJM Holdings chief executive Ambrose So Shu Fai told reporters yesterday.

“And sometimes it’s a matter of whether you are lucky that month.”

But he acknowledged: “Our market share did drop last month, and this could really have been affected by the win rate in the period.”

Mr So told Business Daily: “Now what we can do is relocate and reconfigure our gaming tables, which is pretty much a daily operational routine.”

He explained: “We can still increase our efficiency and profitability by moving

Ambrose So: The development of the market will take its own course

low-yielding tables to higheryielding venues.”

Strong stimulant SJM Holdings has faced increasing competition as its rivals – including Sands China, Wynn Macau Ltd and MGM China Holdings Ltd – lure gamblers to their casinoresorts with shopping malls,

restaurants and theatres.

Its rivals promise to become even more competitive when they open new or expanded casino-resorts in Cotai.

SJM Holdings was the last casino operator to climb aboard the Cotai bandwagon.

The company announced last month at the groundbreaking ceremony for its HK$30 billion casino-resort

in Cotai that the development would be called the Lisboa Palace. The company expects to complete the Lisboa Palace in 2017.

“While our Cotai project will be completed in stages in the coming three years, we hope that during that period we can improve our operational efficiency and proceed with expansion of Casino Jai Alai,” Mr So told us.

He said the renovation of Casino Jai Alai should be completed this year.

“At Jai Alai, we’ll see shopping malls and other amenities apart from the gaming part,” he said.

“With Casino Oceanus and Jai Alai, we hope that the completion of the Hong Kong-Zhuhai-Macau Bridge, around 2016 to 2017, will be a strong stimulant to business growth,” Mr So said.

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Macau

Public transport complaints accelerate Visitors and residents say buses and taxis take too long to arrive and drivers are often impatient, with communication difficult Luciana Leitão newsdesk@macaubusinessdaily.com

Photos by Manuel Cardoso

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ush hour is never easy anywhere in the world but in Macau it is not only during that period that citizens and visitors complain about public transportation.

As people rushed to their places of work, Business Daily accompanied them on their daily bus and taxi rides.

It’s 8:26am. Despite the long lines of people waiting at Praça Ferreira do Amaral, in front of Hotel Lisboa, Business Daily waited only five minutes for bus number 10B, a route that plies some of the busiest areas in town. The ride was quick, and four minutes later it was already in Zape area. With the bus completely full, more people were standing than sitting, with most getting off at the last stop, at the Border Gate, around 9:00am.

From there, it was time to board a bus heading to Cotai, another busy area. After 15 minutes wait, bus number 25 arrived. Once again, more people were standing than sitting.

Some half hour later, number 25 was passing by Praça Ferreira do Amaral before coming to a halt 20 minutes later at its last stop, in Cotai.

Then came the third part of the journey, which was to reach Coloane by bus. After waiting 15 minutes, bus 26A appeared, taking 15 minutes to reach Coloane Village. Returning to the city centre was harder, as it took 20 minutes for bus 50 to arrive, and this journey lasted 45 minutes.

6.6 and 6.1

Level of satisfaction for Transmac and TCM operators (on a scale from 1 to 10)

In Senado Square, three friends from Taipei - one man named Charming Liao and two girls who preferred not to be named - were visiting Macau for the first time.

Asked about their experience of public transport in the territory, they laughed and said in unison: “Taxi drivers are very angry!”

On one of their rides in a local taxi, the driver took them in the wrong location, after which he kicked them out of the cab. “We said we wanted to go somewhere and told him but he understood another place; he got angry”, they explained. Furthermore, they had to wait 10 minutes for the taxi, which they think was too long.

“We live in Taipei and anytime, anywhere, when we wave, we get a taxi.”

They also tried public buses but the experience was no better. “We got on the bus but the driver only wanted money”, they said. After asking for directions from the driver, the only answer they got was: “Just walk, it’s about 10 minutes.” Ten minutes that were, in fact, 30. “We are tired.”

Public complains At 6:00pm - the time working people usually return from work - it was time to test the taxis at Hotel Lisboa, where some 50 visitors were clearly getting impatient. After waiting for 25 minutes with people trying to cut in line, a taxi arrived. It took 15 minutes to reach Nape area.

In front of the China Civil Plaza building, about 35 people were waiting for a bus. Three buses heading to Avenida Almeida Ribeiro passed by, none of which allowed passengers to board as they were already full. The fourth bus was only able to let a few people on that were waiting in line and finally the fifth bus arrived empty.

Total waiting time: 20 minutes.

Zita Lei, 26 years old, is a Macau resident who regularly uses public transportation, mostly to go from her home near the Red Market to a casino in Nape.

It normally takes her 20 minutes

to reach work, which she doesn’t find too bad, notwithstanding the size of the territory; but the worst part is the waiting. “Usually, I wait for 15 minutes and it’s so long for Macau.

The territory is so small”, she says.

She believes the roads could be larger and better in order to avoid traffic jams, and that buses could operate more efficiently.

[Macau’s traffic woes] are compounded by the ubiquitous motor cycles that flood the narrow streets and impede traffic flow as well as pedestrian access Ian Chaplin, Associate professor at University of Macau

She uses taxis to return from work, especially when she is on the late shift at the casino. “But it’s so busy, I have to wait a lot”, she says, adding: “There are so many Mainlanders in Macau that come to gamble, so the taxis are always full when I leave work.”

Márcia Schmaltz, a local resident, complained on Facebook about the quality of public transportation in Macau. “Using certain routes for public buses in Macau is an authentic hell, it practically pushes people to buy a car”, she complained. To Business Daily, she mentioned that not all the public bus routes work badly. “Bus number 5, for instance, is the one that works better in the city”, she says.

She uses everyday public

transportation in Macau to go to several places. Her most regular journey is to go from her home in Avenida do Ouvidor Arriaga to her workplace at the University of Macau. During rush hour, one of two situations may happen: either the waiting time is reduced because buses pass by more frequently or buses are often too full and drivers do not even stop. “I can wait an extra 20 minutes. This happens due to lack of education of the passengers that all stay at the front of the bus, not moving to the back”, she adds. “When it is not rush hour, I can wait up to 20 minutes”, she explained.

To go to the University of Macau it takes her 20 minutes but to return it may take one hour and a half, due to traffic jams. Using different vehicles operated by the three operators Transmac, Reolian and TCM - she says she sees differences between them. “Transmac is better than all the others - the drivers also seem more civilised”, she says.

Taxis are not even an option, particularly during peak hours.

“When you do manage to get into one, there is no guarantee that the taxi is willing to take you where you want”, she says. On Fridays, it is “impossible” to move in the city due to traffic jams and during early mornings there are several “waiting lines” for taxis.

Buying a private car is not an option, due to the “lack of parking spaces and traffic jams”. And, even though the Light Rail Transit is being built, she believes it is hard for the population to wait until it is completed.

Better than in most places Associate professor at University of Macau Ian Chaplin published a paper in 2009 titled ‘Transport Studies for Macao: An Integrated Approach’, saying that since the 1980s there have been “significant improvements”, especially concerning bus routes and services. “Operators are performing

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March 2014 Friday 19, April 19, 2013

Macau

Government creates new routes

a commendable public service with state-of-the-art clean vehicles that convey passengers to all corners of the peninsular and the adjoining islands of Taipa and Coloane”, he says.

He also believes that fares are reasonable and that the introduction of the bus pass system has made life easier for drivers. Moreover, he says that considering Macau is a small city, traffic is generally better than in many cities.

The main problem in the territory is that Macau’s traffic woes “are compounded by the ubiquitous motor cycles that flood the narrow streets

Using certain routes for public buses in Macau is an authentic hell, it practically pushes people to buy a car Márcia Schmaltz

and impede traffic flow as well as pedestrian access”.

He believes taxis are the key form of public transportation in bigger need of improvement. “Complaints are common about the lack of availability and drivers’ preferences for casinobound passengers. Calling a taxi to get to the airport on time is a cause for anxiety when told nothing is available”, he says. Overall, he believes there is a need for more research on transport planning by professional organisations and higher education institutions in Macau in collaboration with affiliated parties in the Pearl River Delta.

Most residents are concerned about the stability of bus departure rates along with frontline staff service and attitude. These are the main results from a study about the level of satisfaction before and after the new model of public transportation, commissioned by the Transport Bureau (DSAT) from Companhia de ERS Soluções (Macau) Limitada, and released to Business Daily.

According to DSAT, the company conducted questionnaires through telephone in July 2011, January 2012 and November 2012. The results reveal that the level of satisfaction has been growing, having started with 5.3 points and finishing with 5.8 points (on a scale from 1 to 10). There was also an increase in satisfaction for Transmac and TCM operators, increasing from around 1 to 6.6 and 6.1 points, respectively. By contrast, citizens’ satisfaction with Reolian decreased from 5 to 4.7 points, by November 2012.

DSAT intends to use the data to monitor the bus service, having asked the companies to submit service improvement plans and having created a bus service evaluation system.

Meanwhile, according to what DSAT revealed to Business Daily, more research conducted by THI Consultants, from Taiwan, about the bus network, recommended that the bus line network be divided into different services: express, general and connecting buses. As a result, DSAT has already started changing public transportation routes and intends to do so progressively in order not to inconvenience citizens.

It has already created express bus routes numbers 39, 25 F, 22F, MT3U, and because of the public housing in Seac Pai Van it will continue creating more. DSAT has already changed route number 6, dividing it into 6A and 6B, with the purpose of shortening the time of the bus journey. For the main bus routes, it has already adjusted numbers 2, 12 and 25 in order to facilitate straighter routes, reducing journey times.

A recent survey conducted by the Macau General Union of Neighbourhood Associations (known as Kai Fong) in July and August found that only 22 percent of bus users agree that overall bus services have improved, while over 50 percent think that the services are mediocre.

Respondents are least satisfied with Reolian, which rated 5.2 (out of 10).

Transmac and TCM rated 6.95 and 6.69, respectively.

Among the rating items, all three operators’ scheduling, quality of service, and complaint and enquiry response mechanisms received a rating below 6 on average, with quality of service scoring lowest.

Respondents were also unhappy with the current mode of bus operation.

One in four respondents think that bus services overall are not remarkable. Almost 20 percent said that the quality has worsened.

Kai Fong said that many respondents have expressed the hope that the government would rearrange bus routes and schedules.

L.L.

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Macau Brought to you by

HOSPITALITY Sticky figures The meetings, incentive, conference and exhibition industry (MICE) was expected to contribute to the diversification of the local economy. The full results for last year suggest the initial promise is still failing to be realised. In terms of total figures, 2013 was only marginally better than the previous year, and marginally worse than 2011. But the total number of events recorded in 2013 still showed a drop in excess of one quarter, compared to their peak in 2010. Most of the events were meetings of one kind or another, carried by the government, associations or companies. One wonders what they actually bring to the local economy, or if most of them would not happen anyway and would go unnoticed in the absence of a specific MICE policy. The share of this type of meeting in the total has been increasing over time, from a little over three-quarters of the total in 2009 and 2010 to around 85 percent in the last three full calendar years.

Macau shop staff to command pay premium The pay of employees in retailing is tipped to rise faster in Macau than in Hong Kong in the next two years Tony Lai

tony.lai@macaubusinessdaily.com

T

The most desirable types of event seem to be, naturally, conferences, incentive travel and exhibitions. They involve and bring more people to the city, and will last longer, as a rule.

However, in the first two cases their trends are not very encouraging. The quarterly average for incentive travel activities in 2010 ran close to 40 events. Last year, the same figure was just 9 events. The number of conferences also declined noticeably in the same period, although it seemed to be making a slight comeback in the second half of 2013. The number of exhibitions is the only really good news in the figures. It has remained comparatively stable throughout the period and rose nicely in the last two years.

66 exhibitions highest annual figure on record since 2009

he tight labour market means that in the next two years Macau retailers will have to dig deeper into their pockets than their Hong Kong counterparts to retain the staff they need, authorities on human resources say.

They say the bright side for shop employees, apart from their pay, is that their career ladder will be easier to climb.

Recruitment company Links International compiles information on pay in various industries from data it acquires through helping companies recruit.

Links International’s report on its 2014 Salary Index for Macau says the basic monthly pay of a sales assistant in a shop here selling luxuries now ranges from 11,000 patacas (US$1,375) to 17,000 patacas.

The basic monthly pay of a shop manager ranges from 28,000 patacas to 40,000 patacas.

Links International managing consultant Carolina Mendes said pay for similar work in Hong Kong, which is known as an international centre for shopping, was “a little bit lower”.

For instance, a shop manager there usually gets between HK$25,000 and HK$38,000 a month.

“There are a lot of job offers in Macau, but the situation is not the same in Hong Kong,” Ms Mendes said. “It is more competitive for job candidates there.”

She expects the retailing pay gap

between Macau and Hong Kong to widen in the next two years as the retailers here pay more for staffing.

“A lot of stores are going to open here this year or next year due to the opening of several casinos,” she said, referring to the casino-resorts due to open in Cotai between next year and 2017.

“This includes a lot of European brands that were previously not here,” Ms Mendes said. “This is not limited to luxury goods stores, but also includes new stores in the mass market.”

Many chances Official data show Macau’s unemployment rate was 1.7 percent in the three months ended January 31, the lowest on record.

The vacancy rate in the retailing industry was 10.2 percent in the fourth quarter of last year, 3.2 percentage points less than a year earlier.

The Statistics and Census Service said the fourth-quarter rate “remained high”.

Secretary for the Economy and Finance Francis Tam Pak Yuen said last month that only with difficulty could the quantity and quality of Macau’s human resources satisfy the city’s needs.

But the government has yet to come up with a solution to the problem.

The managing director of MSS Recruitment Ltd, Jiji Tu, said: “The retailing industry is the third-biggest

MOP40,000

The basic salary a shop manager can reach according to Links Int. salary index employer after casinos and hotels, so they certainly have to offer better salary packages to attract people in the current tight labour market.”

Ms Tu said market conditions were good for those seeking to build a career.

“In Hong Kong, an employee may need 10 years of work experience to be promoted to shop manager, but it only takes six to seven years here, owing to the labour shortage,” she said. “There are many chances for workers.”

Official figures show average monthly earnings in retailing were 12,140 patacas at the end of last year, 41.7 percent more than four years earlier.

Median monthly earnings in all industries were 36.7 percent higher at the end of last year than four years earlier.

The value of retail sales last year was 66 billion patacas, having been 22 billion patacas in 2009.

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Macau

Macau junkets puttin’ on the Ritz Junkets will be able to use exclusive casino playing rooms

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itz Club, the prestigious venue in the United Kingdom capital, will host Macau junkets, according to information released by Gambling Compliance.

The agreement between Ritz Club and Hengsheng Group will be enacted on a six months trial basis but could be extended from June.

This is the first deal of such a nature for the London hotel and casino, as previously they only hosted occasional clients. Now they want to focus on the Chinese market, having realised the massive potential business it represents, as the 2011 installation of the UnionPay payment method confirms. They have also

included three private rooms and more baccarat tables.

On the other hand, Hengsheng Group expects to achieve the premier position in Macau’s junket market, indicating that they are committed to some top players in order to reach it. The junket-style gambler seeks top privilege treatment and the skipping of limitations on currency. Gambling Compliance commented that a Hengsheng Group spokesperson added that they would be the exclusive partner for Mainland China, Taiwan, Singapore, Hong Kong and Macau.

Both parties are now looking to cement a long-term agreement.

MAM puts Picasso, Kusama in frame Museum marks anniversary with number of world-class exhibitions; budget unknown

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he Macau Museum of Art (MAM) announced yesterday an array of international exhibitions to celebrate its 15th anniversary.

Starting from next month, the museum will showcase masterpieces

by Pablo Picasso, Claude Monet, Henri Matisse and Japanese contemporary artist Yayoi Kusama. The anniversary programme will also feature the works of Qi Baishi from the collection of the Beijing Fine Art Academy, Wu Hufan and treasures from Beijing’s Palace Museum. The Picasso, Monet and Matisse paintings are on loan from French National Museums.

MAM director Chan Hou Seng declared at a press conference that over 600 masterpieces will be showcased here throughout the year.

However, he declined to disclose this year’s budget, just saying it will be similar to last year’s.

Mr Chan also announced that a plan to expand the museum shop is underway. A teahouse and a commercial art gallery will be added.

“It is hoped that the new shop will provide a leisure and entertaining visiting experience,” he said.

Since opening in March 1999, MAM has welcomed 2.8 million visitors and staged 330 exhibitions featuring 18,000 exhibits. One of this year’s priorities, according to Mr Chan, is to attract more children and families.

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Macau

Big contractors feast on Cotai Macau construction projects, particularly those in Cotai, are a blessing for Hong Kong-listed builders Stephanie Lai and Tony Lai newsdesk@macaubusinessdaily.com

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ong Kong-listed contractors have benefited hugely from the construction frenzy in Macau, especially the casino-resort building boom in Cotai, their annual results indicate.

Hsin Chong Construction Group Ltd told the Hong Kong Stock Exchange this week that its revenue in Macau had been over HK$3.46 billion (US$445.8 million) last year, nearly five times more than the year before.

Hsin Chong attributed the increase to a new contract to manage construction of a high-rise building on land being developed by casino operator Sands China Ltd, and to site formation, architectural and finishing work contracts for the second phase of Galaxy Entertainment Group Ltd’s Galaxy Macau casinoresort. The second phase the

Galaxy Macau is due to open next year.

The company said its “strategic relationships” with two gaming concessionaires had helped to give it a firm foothold in Macau.

Its revenue in Macau made up 30 percent of its revenue from all sources, which rose by 6.6 percent to HK$11.51 billion.

Hsin Chong also won last year contracts to modernise a sewage treatment plant in Macau and build the new campus of the University of St Joseph in Ilha Verde.

Another contractor, China State Construction International Holdings Ltd, made plenty of profit in Macau last year, although its revenue here dipped.

China State Construction told the stock exchange this week that its gross profit from its operations here had risen to HK$123.7 million,

87 percent more than the year before.

However, its revenue in Macau fell by 7.1 percent to HK$836.5 million because, it said, projects here were in their preliminary stages and work on them had yet to get into full swing.

Flourishing market The company won last year a contract worth HK$1.9 billion to build public housing in Ilha Verde and a contract worth HK$10.5 billion to build MGM China Holdings Ltd’s first casino-resort in Cotai. The MGM China project is due to be completed in the middle of 2016.

“Macau’s construction market continues to flourish,” the company said.

“Optimism about the construction markets in Hong Kong and Macau in 2014 is growing, in respect of the

HK$3.46 billion Hsin Chong Construction Group revenue in 2013

number of new construction projects, the employment rate and profit forecast,” it said.

But China State Construction bemoaned the difficulty it had in finding sufficient suitable labour in Macau and Hong Kong alike.

“The shortage of resources was as serious as before,” it said.

The company said it would have to think again about the pay, benefits and job satisfaction it offered if it was to compete for workers.

The Macau Federation of Trade Unions last week urged the government to monitor building contractors more closely.

A Legislative Assembly member who belongs to the federation, Ella Lei Cheng I, told Secretary for the Economy and Finance Francis Tam Pak Yuen in a meeting that some contractors working on casino-resorts in Cotai had sacked Macau permanent residents they employed so they could instead take on migrant workers, who were cheaper to employ.

Mr Tam said after the meeting that the government would talk to the companies in question soon, and ask them to “safeguard the rights of locals” better.

Corporate Galaxy Entertainment Group donates towels to animal centres Galaxy Entertainment has taken the opportunity of donating over 200 towels to Anima, having refurbished several of its hotel properties. The Abandoned Animals Protection Association of Macau will use the towels for a variety of purposes, including making beds more comfortable for cats and dogs.

Recruiting﹕ Work location:

Requirements:

Working days﹕

Annual leave: Salary﹕

Administrative staff (Macau ID card holder only) Coloane (Estrada do Altinho de Ka-Ho) and/or Macau (Si Toi Building) Must be punctual, assiduous, responsible and organized.

Fluent in English and Chinese (driving license holder is preferable) 5 working days per week (9:00 to 13:00 and 15:00 to 19:00 or 14:00 to 18:00) 15 days (after one year of work) MOP 10,000 with 13 months salary (in probation) MOP 12,000 with 13 months salary (after probation) MOP 13,000 with 13 months salary (after one year) MOP 15,000 with 13 months salary (after 5 years or if with 5 years relevant experience in accepted relevant companies)

Please call 63008191 (Ashley) / 62438167 (Kiko) for more information.

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Stocks Watch

Casinos affected by lower estimate Tencent rebounds, rail companies gain Kana Nishizawa

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ong Kong’s stocks advanced, with the benchmark index climbing from a five-week low, as Tencent Holdings Ltd. and train companies jumped.

Tencent surged 5.8 percent as Asia’s biggest Internet company snapped a four-day, 11.5 percent rout before releasing earnings tomorrow. CSR Corp., China’s biggest trainmaker, rose the most since October 2011 after saying it won orders worth 20.8 billion yuan ($3.4 billion). Casino shares slid after Credit Suisse Group AG cut its estimate on Macau gaming revenue.

The Hang Seng Index added 0.5 percent to 21,583.50 at the close in Hong Kong, paring its loss this year to 7.4 percent. About five stocks advanced for every four that dropped on the 50-member gauge. Tencent had tumbled after China’s central bank blocked plans by the company to offer virtual credit cards. The Hang Seng China Enterprises Index, also known as the H-share index, advanced 0.1 percent to 9,342.28.

“We are seeing a strong recovery in Tencent after a significant correction over the past few days, and as people cover their shorts ahead of the results announcement,” said Alex Wong, a Hong Kong-based director of asset management at Ample Capital Ltd. Tencent gained to HK$578, the steepest advance on the Hang Seng Index, after yesterday sliding to its lowest level since Feb. 13.

CSR jumped 13 percent to HK$6.30 after saying it signed contracts to sell or repair train cars.

Citigroup Inc. recommended buying the stock, boosting its rating from sell. Zhuzhou CSR Times Electric Co., a provider of electrical systems for trains, jumped 13 percent to HK$25.10, its biggest gain since November 2011.

Macau Casinos China Resources Power Holdings Co. climbed 4.5 percent to HK$19.24, extending Monday’s advance after its full-year profit beat analyst estimates.

Wynn Macau Ltd., a unit of billionaire Steve Wynn’s gaming company, fell 3 percent and SJM Holdings Ltd., Asia’s biggest casino operator, slid 2.5 percent, leading declines on the MSCI Hong Kong Index.

Macau’s March gaming growth estimate may grow between 9 percent to 14 percent, Credit Suisse wrote in a note, compared with its previous estimate of 18 percent to 22 percent.

China Overseas Land & Investment Ltd., the biggest mainland developer listed in Hong Kong by market value, fell 1.3 percent after a private property developer collapsed and data yesterday showed growth in new-home prices in China’s biggest cities slowed last month.

Home Prices Zhejiang Xingrun Real Estate Co. doesn’t have enough cash to repay 3.5 billion yuan of debt, government officials familiar with the matter said on Monday. Its collapse comes less than two weeks after Shanghai Chaori Solar Energy Science & Technology Co. became the first company to default on its onshore corporate bonds.

Home prices in Beijing and the southern business hub of Shenzhen each rose 0.2 percent in February from a month earlier, the National Bureau of Statistics said today. That was the slowest pace since October 2012. They added 0.4 percent in Shanghai, the smallest increase since November 2012, and gained 0.5 percent in Guangzhou. Prices climbed in 57 of the 70 cities tracked by the government, compared with 62 in January.

Wind-farm operator China Longyuan Power Group Corp. tumbled by a record 14 percent after last year’s profit missed analyst estimates.

The H-share measure traded at 6.3 times estimated earnings yesterday, compared with 15.8 for the Standard & Poor’s 500 Index on Monday.

Bloomberg News

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March 19, 2014 Friday April 19, 2013

Greater China Zhejiang real estate company collapses A Chinese property developer owing 3.5 billion yuan (US$566.52 million) to banks and individuals is teetering on the edge of insolvency, and its owner has been detained for illegal fund-raising, domestic media reported, citing local officials. Zhejiang Xingrun Real Estate Co, based in Fenghua in eastern Zhejiang province, owes 15 domestic banks 2.4 billion yuan, state-owned China News Services reported. The company illegally raised most of the remaining funds from 98 individual investors, according to the report on Monday. Private fundraising is common but illegal in China.

Taiwan-China progress in bank deal A crucial trade deal between China and Taiwan has passed the first hurdle in Taiwan’s parliament despite opposition party concerns about Beijing’s growing influence on the Taiwanese economy, media reported on Tuesday. The ruling Nationalist Party said an initial review of the pact had been completed, which could pave the way for a final review in parliament on April 8, the Commercial Times and the China Times reported. The reports said the opposition Democratic Progressive Party (DPP), would vote against the deal although it lacks the numbers to block its final passage.

Bentley anticipates increased sales Volkswagen AG’s Bentley Motors luxury unit expects to reverse last year’s decline in China deliveries after introducing a variation of its Flying Spur saloon next month.

“We’re sure that we’re able to, let’s say, make an improvement over last year,” Ricky Tay, Bentley China’s managing director, said in an interview in Beijing yesterday.

The Flying Spur V8, with the lowest starting price among Bentley’s four-door sedans, “will open up a new avenue to the luxury brand,” he said. Bentley will open three to four dealerships in China this year, adding to the 36 it currently has, as the company targets more entrepreneurs, Tay said.

JA Solar profits shine The biggest solar cell producer rose the most in more than six months after reporting its first profit since the first quarter of 2011 and shipments exceeded its forecast by as much as 33 percent.

The company earned 142.3 million yuan (US$23.5 million), or 0.38 yuan a share, compared with a loss of 582 million yuan, or 3.01 yuan, a year earlier, according to a statement today. Shipments of 665.5 megawatts of panels and cells exceeded the company’s November forecast of 500 megawatts to 550 megawatts.

Stabbed HK editor case progresses The police department of southern China’s Guangdong province yesterday sent back to Hong Kong two people arrested in connection with the stabbing of Kevin Lau, the former chief editor of the city’s Ming Pao Daily News. The two Hong Kong residents, both 37 years old, are suspected of fleeing to mainland China after the attack on Lau in Hong Kong last month, according to a statement posted on the city government’s website yesterday. Hong Kong doesn’t have a formal agreement with mainland China on the rendition of criminal suspects, so city police relied on the cooperation of Guangdong’s Public Security Department and China’s Ministry of Public Security to detain and return the individuals, according to the statement.

New house price growth slows At least 10 Chinese cities stepped up measures to calm local property

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hinese new-home price growth slowed last month, led by the four cities the government defines as first tier, amid tighter credit to rein in excessive borrowing and individual city measures to curb property prices.

Prices in Beijing and the southern business hub of Shenzhen each rose 0.2 percent in February from a month earlier, the National Bureau of Statistics said today. That was the slowest pace since October 2012. They added 0.4 percent in Shanghai, the smallest increase since November 2012, and gained 0.5 percent in Guangzhou.

Prices climbed in 57 of the 70 cities tracked by the government. That compares with 62 in January.

The government has noticed that each city has different supply issues Yao Wei, China economist, Societe Generale Hong Kong

“Overall, we see the property sector as becoming increasingly a major and more real risk to growth

and financial stability this year,” said Dariusz Kowalczyk, a senior economist and strategist at Credit Agricole CIB, in an e-mailed reply to questions on the data.

The government will curb demand for housing among investors and regulate the home market “differently in different cities,” Premier Li Keqiang said last week. It has also been reining in lending that lend to excessive borrowing and now is sparking defaults. A closely held

Chinese real estate developer with 3.5 billion yuan (US$566 million) of debt has collapsed and its largest shareholder was detained, government officials familiar with the matter said yesterday.

Tighter Credit At least 10 Chinese cities stepped up measures to calm local property markets at the end of last year. Credit growth trailed analysts’ estimates in

Yuan’s widening starts producing This decline will cheapen Chinese exports

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he yuan is poised to weaken against the dollar in 2014 for the first time in five years after China’s central bank doubled the currency’s trading range, according to Bank of America Corp. and Barclays Plc. At least four banks cut their projections for the yuan following the People’s Bank of China’s March 15 announcement of the band’s widening to 2 percent on either side of a daily fixing.

“The market is much less enthusiastic about the yuan now,” Suan Teck Kin, an economist at United Overseas Bank Ltd. in Singapore who lowered his yuan estimate yesterday, said in a phone interview. “The PBOC’s preference for two-way flexibility is clear. The steady appreciation of the currency of the past years may not be repeated anytime soon.”

The band widening fits the PBOC’s goal of discouraging capital inflows from investors who make oneway bets on the yuan and is part of Premier Li Keqiang’s plans to accelerate moves to make the currency more convertible. A decline will also cheapen Chinese exports, which slumped 18.1 percent in February, the biggest drop since 2009.

“The opportunity for the currency to trade weaker is now greater” with a broader trading range, Hamish Pepper, a Singapore-based currency

strategist at Barclays, said in a phone interview yesterday.

Greater Flexibility Bank of America lowered its yearend yuan estimate to 6.10 per dollar from 6.0, implying the currency will post the first annual decline since 2009. The greater flexibility under a wider band, potential dollar strength and downgrade of China’s growth outlook prompted the revision, analysts led by Claudio Piron wrote in a March 16 note. Bank of America cut its estimate for China’s 2014 economic growth to 7.2 percent from 7.6 percent on March 13.

The market is much less enthusiastic about the yuan now Suan Teck Kin, economist, United Overseas Bank Singapore

UOB reduced its year-end yuan forecast to 6.05 per dollar from 6.02. The PBOC may widen the daily trading band to as much as 4 percent in the second half of this year, Suan said. Standard Chartered lowered its end-June forecast to 6.06

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March 2014 Friday 19, April 19, 2013

Greater China

down markets

a second month in February by 10.8 percent from a year earlier, according to SouFun Holdings Ltd., the nation’s biggest real estate website owner.

About 80 percent of home sales in China come from non-listed developers, according to estimates

by UBS AG.

Negative Sentiment

February as aggregate financing was 938.7 billion yuan, the People’s Bank of China said March 10, less than the 1.31 trillion yuan median estimate of analysts surveyed by Bloomberg News.

Home prices in the eastern city of Wenzhou led the drop among the 70 cities where prices declined by falling 0.2 percent from a month earlier and 3.9 percent from the same period last year.

Private data also showed cooling signs. Home-price growth slowed for

results per dollar from 6.01 and maintained a year-end prediction of 5.92.

China’s currency could weaken to 6.30 per dollar or even lower over the course of this year, according to Deutsche Bank AG, the biggest foreign-exchange trader. The yuan Deutsche Bank Frankfurt headquarters

Home prices in Ningbo rose 0.3 percent last month from January and 6.1 percent from a year earlier, today’s data showed. That was compared with a 0.5 percent gain in January from December and 7.3 percent from a year earlier.

Home sales fell 5 percent in the first two months of the year from 2013, while new property construction fell 27 percent, the statistics bureau data showed last week.

New home price gains in firsttier cities also slowed from a year earlier. Housing values in Shanghai, Guangzhou and Shenzhen all rose 16 percent, respectively, from a year earlier, the slowest pace since at least August. Prices in Beijing jumped 12 percent, the lowest since May. Existing-home prices were unchanged in Beijing last month from a month earlier and increased 0.6 percent in Shanghai, according to the data.

“The property cycle is turning downwards and the government has noticed that each city has different supply issues,” Yao Wei, China economist at Societe Generale SA in Hong Kong, who is ranked the most accurate forecaster of China’s gross domestic product by Bloomberg, said before yesterday’s release. “Credit and liquidity are the key factors for the property sector, while easing mortgages is probably the easiest thing to do.”

Bloomberg News

no longer has a high carry and it was “too strong” compared with other emerging-market surplus currencies, Bilal Hafeez, Londonbased global head of foreignexchange strategy, wrote in a report dated on Monday.

The yuan has weakened 2.2 percent since reaching a 20-year high of 6.0406 per dollar on Jan. 14. It strengthened 2.9 percent in 2013.

One-month implied volatility, which is used to price options, jumped as much as 31 basis points yesterday to 2.75 percent, the highest since September 2012.

Appreciation Bets The yuan’s declines were spurred by the central bank in order to curb one-way bets on its appreciation before the widening of the band, HSBC Holdings Plc strategists led

by Paul Mackel in Hong Kong wrote in a March 15 note. The currency may slide toward the lower end of its new trading range because the expansion is an implicit message that the authorities are comfortable with further declines, Brown Brothers Harriman & Co. strategists led by Marc Chandler in New York wrote in a note.

Official data in the past two weeks have shown a slump in factory and consumption, making it harder for some companies to service debt. Zhejiang Xingrun Real Estate Co., a property developer with 3.5 billion yuan (US$566.6 million) of debt doesn’t have enough money to repay creditors and has collapsed, government officials familiar with the matter said yesterday.

Bloomberg News

3M grows at triple global pace Anti-pollution face mask posts record sales

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hina sales for the company will grow three times faster than the company’s total revenue because of demand for health and consumer products such as face masks and water filters, Chief Executive Officer Inge Thulin said.

The maker of Post-it notes, based in St. Paul, Minnesota, is targeting annual Chinese sales growth of about 15 percent over the next five years, compared with global growth of between four and six percent, Thulin said in a March 13 interview at 3M’s offices in Shanghai. China generated about 10 percent of its global revenue of US$30.9 billion last year, he said.

3M is capitalizing on China’s push to increase the role of consumption in driving economic expansion as rising levels of pollution and higher labour costs force the country to reduce its reliance on exports, investment and manufacturing for growth.

The government has set a target of doubling per capita incomes by 2020 from 2010 levels and emphasized improving the quality of economic growth.

“We have capitalized on infrastructure and manufacturing and now we are on safety, consumer and health care,” Thulin said.

Services industries accounted for 46.1 percent of the economy last year, with the proportion exceeding that of manufacturing industries for the first time, according to the statistics bureau. The government is seeking to increase the share to 47 percent by 2015, according to its five-year plan. In the U.S., the world’s biggest

US$30.9 billion generated in China last year

economy, services comprise about 90 percent of gross domestic product.

“If you think about it from the big mega-trends, there’s air pollution, water and food safety,” Thulin said.

“There are big opportunities for us in those areas.”

Face Masks China suffered from record levels of pollution last year, causing unanticipated demand for the company’s face masks, which can filter out particles less than 2.5 micrometres in diameter that are the most dangerous to health than other particulate matter.

The masks sold out last December, according to Royce Hua, the head of corporate communications in China.

3M is now better prepared to deal with any potential shortages of masks, Thulin said. The company has 11 manufacturing plants in China that produce everything from adhesives, tapes and filters to the Post‑it sticky notes.

Bloomberg News

Greenland to list in Shanghai Greenland entered the U.S. and Australia last year

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reenland Holding Group Co., the Shanghai city government-owned builder of one of China’s tallest towers, plans to list on the Shanghai Stock Exchange through an asset swap with an affiliate.

Greenland will inject assets worth 65.5 billion yuan (US$10.6 billion) into Shanghai Jinfeng Investment Co. in exchange for 11.3 billion new Jinfeng shares at 5.64 yuan each, Jinfeng said in a statement to the city’s stock exchange yesterday.

“After the entire listing, Greenland may use the capital market as a platform to improve overall competitiveness and boost profitability,” Jinfeng said in the statement.

Greenland’s back-door listing comes as it seeks investment opportunities abroad and as Shanghai steps up efforts to make its state-owned enterprises more profitable and efficient. Chinese developers are virtually denied access to financing through initial public offerings amid a government crackdown on rising home prices, according to Wu Kan, a fund manager at Dragon Life Insurance Co. in Shanghai.

Greenland, which entered the U.S. and Australia last year,

is joining Chinese developers including China Vanke Co. that are venturing into real estate abroad as they seek opportunities to diversify outside their home market. Dalian Wanda Group said in June it would build a luxury hotel and apartment building on the South Bank of the River Thames in London.

Greenland said in January it plans to invest 1.2 billion pounds (US$2 billion) on two property projects in London as Chinese developers branch out overseas.

Greenland, set up in 1992 and owned by the Assets Supervision and Administration Commission of Shanghai Municipal Government, is also looking to enter Canada, France and Singapore this year, it said then.

Approvals Needed The asset swap is pending the approval of shareholders and the China Securities Regulatory Commission, Jinfeng said yesterday.

Both Greenland and Jinfeng are controlled by state-owned Shanghai Real Estate Group Co. Shares of Shanghai Jinfeng will resume trading today after being suspended since August 26, according to the statement.

Bloomberg News

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Asia

Caesars finds an ally in Asia The biggest US casinos owner finally reaches Korea after Macau failure

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outh Korea granted yesterday a preliminary casino licence to a Lippo Ltd and Caesars Entertainment Corp venture to build a resort on Yeongjong island, as the government tries to court wealthy Chinese punters with an array of gambling options. It is the first time that foreign capital has received a preliminary casino licence.

Genting Singapore and Chinese property developer Landing International Development have announced plans for a US$2.2 billion casino resort on the southern island of Jeju but have yet to secure a preliminary licence.

“The approval of the CaesarsLippo project will be a watershed to gauge the government’s will toward the casino industry,” Thomas Bae, a service industry analyst at Woori Investment & Securities Co. in Seoul, said before today’s announcement.

“The casino industry has superb growth potential and if the regulatory hurdle is lowered, it would further bolster foreign investors’ appetite in the industry.”

The first phase of the project, located minutes away from Incheon International Airport about 50 kilometres west of Seoul, will include a foreigner-only casino and at least two hotels expected to be built by 2018, the country’s Ministry of Culture, Sports and Tourism said in a statement.

The first phase will cost about 746.7 billion won (US$700 million), the ministry said. The entire development will cost around 2.3 trillion won and will be built over a period of nine years, the companies said in a statement in December.

A local spokesman for LOCZ Korea, the joint venture set up by Hong Kong-based Lippo and Caesars, declined immediate comment.

US$2.2 billion

project investment The South Korean government will also seek parliament’s approval to ease the process of granting foreigner-only casino licenses to offshore investors, from requiring prior government approval to an open bidding process.

Although they have not formally said they will bid for a gaming license yet, Wynn, MGM and other major foreign firms that had previously expressed interest in building a casino

Caesar Palace casino at Las Vegas

RBA supports low interest policy The average home price in Australia’s biggest cities rose 9.5 percent

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ustralia’s central bank said it saw more signs record-low interest rates were boosting growth, and reiterated a period of steady borrowing costs was likely.

“Timely indicators were consistent with some improvement in economic conditions over recent months,” the Reserve Bank of Australia said in minutes released yesterday of its March 4 meeting, where it kept the benchmark cash rate unchanged at 2.5 percent. “The decline in the exchange rate seen to date would assist in achieving balanced growth in the economy, though members noted that the exchange rate remained high by historical standards.”

Markets and economists predict the central bank will leave rates unchanged this year to avoid a growth gap emerging as mining companies plan fewer projects. Low borrowing costs are driving up home prices, underscoring the RBA’s reluctance to add to its 2.25 percentage points of rate cuts since late 2011.

“A strong increase in approvals for residential buildings over recent months -both for high-density and detached

dwellings- pointed to a substantial increase in dwelling investment in subsequent quarters,” the RBA said.

“Members noted that construction firms were optimistic about the outlook and had reported a pick-up in enquiries from prospective new home buyers.”

House Prices The average home price in Australia’s biggest cities rose 9.5 percent in the year to February 28, according

to the RP Data-Rismark home value index. Prices in Sydney surged 14.1 percent from a year ago. Approvals to build new dwellings in Australia jumped 6.8 percent in January from a month earlier, according to government figures. House-price inflation had “declined somewhat” from the “fast pace” seen in 2013, the RBA said.

“Members noted that the recent momentum in households’ risk appetite and borrowing behaviour warranted close observation, but

agreed that present conditions in the household sector did not pose a nearterm risk to the financial system,” the minutes showed, citing a briefing to the board on the RBA’s half-yearly assessment of the financial system.

“Members discussed the experience in other countries where macroprudential tools had been utilized to slow demand for established housing and their possible application in Australia.”

Bloomberg News

editorial council Paulo A. Azevedo, José I. Duarte, Emanuel Graça, Mandy Kuok Founder & Publisher Paulo A. Azevedo | pazevedo@macaubusinessdaily.com CLOSING editor Michael Grimes GROUP SENIOR ANALYST José I. Duarte Newsdesk Cynthia Wong, Luciana Leitão, Michael Armstrong, Óscar Guijarro, Pierre-François Metayer, Stephanie Lai, Tony Lai EDITOR AT LARGE Alex Lee Brands & Trends Raquel Dias Creative Director José Manuel Cardoso WEB & IT Janne Louhikari Contributors James Chu, João Francisco Pinto, José Carlos Matias, Larry So, Pedro Cortés, Ricardo Siu, Rose N. Lai, Zen Udani Photography Carmo Correia, Manuel Cardoso Assistant to the publisher Laurentina da Silva | ltinas@macaubusinessdaily.com office manager Elsa Vong | elsav@macaubusinessdaily.com Agencies Bloomberg, Reuters, AFP, Xinhua, Lusa, Project Syndicate Printed in Macau by Welfare Ltd.

Business Daily is a product of De Ficção – Multimedia Projects Address Block C, Floor 9, Flat H, Edf. Ind. Nam Fong Av. Dr. Francisco Vieira Machado, No. 679, Macau Tel. (853) 2833 1258 / 2870 5909 Fax (853) 2833 1487 Email newsdesk@macaubusinessdaily.com Advertising advertising@macaubusinessdaily.com Subscriptions sub@macaubusinessdaily.com

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March 2014 Friday 19, April 19, 2013

Asia in Incheon could try again when the process is eased, a government source with direct knowledge of the approval process told Reuters.

There are 16 foreigner-only casinos throughout South Korea, of which half are controlled by local firm Paradise Co Ltd and state-owned Grand Korea

Leisure Co Ltd. Chinese visitors accounted for about 60 percent of customers at Paradise’s five casinos but contributed more than 80 percent of the revenue in 2013, a spokesman for Paradise said.

The 16 casinos saw total revenues of 1.25 trillion won in 2012, with the market growing a yearly average of 15 percent in the five years up to 2012, according to the latest public data by Paradise.

2018 Olympics The venture plans to open the Incheon resort in time for the 2018 Winter Olympics in Pyeongchang, South Korea, Caesars said in an e-mailed statement today.

Caesars, the largest owner of U.S. casinos, is entering the South Korean market after failing to secure a license in Macau, the only place in China where casinos are legal.

The Las Vegas-based casino operator’s net loss tripled to US$1.76 billion in the fourth quarter as it reported higher write- downs, according a March 11 statement.

The company, struggling to reduce debt as Americans cut back gambling spending, this month said it sold four casinos to an affiliate for US$2.2 billion.

Caesars and rivals Las Vegas Sands Corp., Wynn Resorts Ltd., and Melco Crown Entertainment Ltd. have said they are interested in a gambling resort in Japan should the country legalize casinos. Japan’s government has said it is considering eliminating the casino ban as a way to boost tourism and stimulate economic growth.

Reuters and Bloomberg News

Tata Group ready to reshape Indian infrastructures

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yrus Mistry, chairman of India’s Tata group, is planning to spend at least $8 billion building roads, airports and housing, betting a stable administration after India’s coming elections will lead to a new wave of infrastructure development.

Mistry, who took over as the group’s chairman in December 2012 after Ratan Tata’s two decades at the helm, is expanding at least three unlisted infrastructure companies within the US$100 billion conglomerate, according to two people familiar with his plans. The businesses will get more attention after Mistry has overhauled operations at bigger, listed Tata companies including the auto and steel units.

The initiative from Tata, which control assets including Jaguar Land Rover and New York’s Pierre hotel, underscores the hope among Indian corporates that infrastructure project approvals and spending will pick up when a new government is formed after elections ending in mid-May. “Mistry looks at this sector as a phenomenal opportunity,” said U.R. Bhat, managing director of the India unit of U.K.-based Dalton Strategic Partnership LLP, which manages US$2 billion globally. “It’s a natural extension of their capabilities. Tata has the financial muscle to bid for the biggest of the projects and dominate,” he said.

India needs to spend US$2.2 trillion by 2030 on urban transportation, housing and office space to boost infrastructure ranked below that of Guatemala and Namibia by the World Economic Forum, McKinsey & Co. said in a 2010 study.

Triple Order Book From 2012 through 2017, India is likely to spend 41 trillion rupees (US$668 billion) on infrastructure with almost half of it being provided by the private sector, Siddhartha Roy, Tata Group’s chief economic adviser, told reporters in June.

Tata Housing Development Ltd., Tata Projects Ltd. and Tata Realty and Infrastructure Ltd. or TRIL, which builds information technology parks, malls and residential complexes, are among the infrastructure units that are aiming to more than triple their order books to 700 billion rupees in five years, said Sarika Kapoor Chokshi, a Tata Sons Ltd. spokeswoman in Mumbai.

TRIL plans to spend 227 billion rupees in the next five years building highways, airports, hotels and urban transportation, according to a presentation made by Managing Director Sanjay Ubale last June.

Bloomberg News

Analysts differ on Japan’s economy forecast Japan’s debt will equal 242 percent of the economy by the end of 2014

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conomists are split over how long Japan’s government has to rein in the world’s biggest debt burden, a Bloomberg News survey shows, adding to a debate on whether the government should keep racketing up a sales tax.

Eleven of 34 analysts said the government has four years or less to put fiscal policy on a sustainable path and avoid a crisis, while seven said it has over 10 years. BNP Paribas SA and Credit Suisse Group AG were among five saying it’s too late to avert one. UBS AG says chances of a fiscal crisis are remote.

The lack of consensus offers an opening to opponents of a 2-percentage point increase in the sales tax, due next year after a 3-point jump next month. At stake is ensuring an improvement in Japan’s finances to assure demand for public debt remains once the central bank, the biggest buyer of the securities, achieves its inflation target and tapers stimulus.

“The government should demonstrate a clear road map for fiscal reconstruction before 2 percent inflation takes root,” said Yoshimasa Maruyama, chief economist at Itochu Corp. “If it doesn’t do that, investors might attack.”

A longer period would offer Prime Minister Shinzo Abe and his potential successors

time to focus on strengthening economic growth before addressing a shortfall in social security financing.

Government debt currently exceeds twice the size of gross domestic product.

‘Extremely Meaningful’ The Topix index of stocks rebounded from a six-week low and was up 1 percent at the midday break. The yen was little changed at 101.77 per dollar.

Those who have expressed concern about the potential

damage to a Japanese recovery from fiscal tightening have ranged from Nobel laureate Paul Krugman to Koichi Hamada, a retired Yale University professor who advises Abe on monetary policy. The government should freeze plans to raise the levy and instead cut the number of parliamentary representatives and bureaucrats, opposition Your Party says.

While BOJ Governor Haruhiko Kuroda repeatedly says it’s too early to discuss an exit strategy for the

central bank’s easing, he has signalled an immediate need to address fiscal challenges.

Kuroda praised Abe for his October decision to raise the sales tax to 8 percent, saying it was “very meaningful,” and urged continued fiscal consolidation efforts.

Having warned February 12 that doubts over sustainability of Japan’s finances would push up bond yields, Kuroda said in a March 13 interview with the Asahi newspaper that a corporate tax cut Abe plans would reduce revenue and

should be considered within the overall tax framework.

Current Account Japan’s debt will equal 242 percent of the economy by the end of 2014, according to International Monetary Fund. Overseas investors, reflecting a large pool of domestic savings, hold just 8 percent of its bonds.

A risk for the government in coming years is that cushion will erode as baby boomers start to retire in larger numbers from 2015 and draw down savings, said Hidenori Suezawa, a financial market and fiscal analyst at SMBC Nikko Securities Inc. Japan’s current-account balance could swing into a sustained deficit between 2020 and 2025, boosting reliance on foreign creditors and the risk of a surge in yields, said Suezawa, who is a member of the government’s fiscal system council.

“I’m watching the current account balance carefully and am worried about it,” said Masahiro Fukuda, investment director at Fidelity Worldwide Investment in Tokyo, who said a deficit was possible in three to five years. “If a country has twin fiscal and current-account deficits, capital could be withdrawn really quickly.”

Bloomberg News

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March 19, 2014 Friday April 19, 2013

International Letter to drop tobacco sale

Which currency do I chose?

A group of 28 U.S. attorneys general has urged Walmart and four other big retailers to stop selling tobacco products, saying they should not be available in stores that provide health care services. The group sent a letter on Sunday to chief executive officers of Wal-Mart Stores Inc, supermarket operators Kroger Co, Safeway Inc, which operate pharmacies, and drugstore chains Walgreen Co and Rite Aid Corp. Wal-Mart, Walgreen, Rite Aid and Kroger all said they were reviewing the letter, while Safeway did not respond to requests for comment.

Cuba start the process of merging its two currencies amidst people doubts

Russian tycoon buys oil and gas unit German utility company RWE is to sell its oil and gas unit DEA to investors led by Russia’s second-richest man Mikhail Fridman, giving up a profitable part of its business in a bid to emerge from a deep energy industry crisis. RWE posted its first net loss since 1949 earlier this month, hit by weak European energy demand, 30.7 billion euros in debt and a surge in renewable energy capacity that has pushed coal and gas‑fired plants out of the market.

Sony Pictures announces layoffs Sony Pictures Entertainment will announce layoffs throughout its studio operations in the United States and abroad, according to a person familiar with the matter.

Among the units that will be hit is the Sony interactive team that supports digital marketing, the source said on condition of anonymity. Under pressure from hedge fund manager Daniel Loeb to improve profitability at its studio, in November Sony hired consultancy Bain & Co to identify more than US$100 million in cost cuts through layoffs and other means.

American Express creates a travel joint venture American Express Co commented that four financial investors have committed a total of US$900 million to a business travel joint venture, in what would be the largest single investment ever made in a travel management company. The deal highlights some of the challenges facing the world’s biggest credit card issuer, as tighter corporate budgets weigh on its business travel division, which helps employees of companies with their travel arrangements.

Qatar Investment Authority, BlackRock Inc and Macquarie Capital will join Certares LP in the joint venture.

Microsoft Office for iPad by the end of March Microsoft Corp Chief Executive Satya Nadella might unveil an iPad version of the company’s Office software suite on March 27, a source told Reuters, potentially using his first major press outing to launch the company’s most profitable product for Apple Inc’s popular tablet. Nadella, who replaced long-time CEO Steve Ballmer earlier this year, will address the media and industry executives in San Francisco on March 27.

Investors for years have urged Microsoft to adapt Office for mobile devices from Apple and Google Inc, rather than shackling it to Windows as PC sales decline.

Central Committee of the Cuban Communist Party

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uba is laying plans to move to a single currency, a reform that many feel is one of the toughest challenges facing President Raul Castro as he tries to kick-start the Communist country’s moribund economy.

For years Cuba has had two currencies - the peso (CUP), in which most wages are paid and local goods priced, and the convertible peso (CUC), used in tourism, foreign trade and some stores carrying imported goods.

The peso, says the government, will remain and the CUC will become history.

Economists applaud the government plan, but secrecy over the all-important details of how and when the change will come is causing some anxiety in the country.

News this month that state companies were ordered to prepare for unification and that personnel are being trained for what the government dubs “Day Zero” has added to the worry.

Cuba is a country where almost the entire economy is in state hands and most prices fixed. Companies must exchange convertible currency and CUCs, pegged to the US dollar, with the government at the official exchange rate of one peso, while the CUC has been valued for years at 24 pesos by state-run exchange offices.

Which currency to hold on to, if any, has become the talk of the town.

“Since I have no idea what is going on I have decided to spread my money among many currencies, like the US dollar and euro,” Raúl, who runs a Havana restaurant, said, refusing to give his last name as by law he can only accept local currency.

I have decided to spread my money among many currencies, like the US dollar and euro Havana’s restaurant owner

“The clients pay with whatever money they have, and I work out the exchange rate,” Raul said with a laugh as he stood at the door of his Havana business.

Foreign and domestic economists are unanimous that the current monetary system and fixed exchange rates mask inefficiencies, make

accounting difficult and undermine other reforms.

But they also believe unifying the currencies is perhaps the most difficult and socially disruptive of a series of market-oriented reforms.

“The elimination of the dual currency, which is based on a devaluation, means there will be an initial shock ... There won’t be initial benefits but short-term costs (inflation) and benefits in the midterm,” Pavel Vidal, a former Cuban central bank official now at Javeriana University in Cali, Colombia, said in an e-mail interview.

The experts admit they are not sure how the government will proceed, nor how it will keep Castro’s promise not to create further hardship for Cuba’s 11.2 million inhabitants who worry that the little money they have will be devalued directly or through inflation when unification occurs.

Vidal believes the process of unification has begun with the devaluation of the official one peso to the US dollar or CUC exchange rate.

He says the government is currently testing 900 percent devaluation with a number of companies, trading on average 10 pesos for a CUC or US dollar.

“From what I can tell, the disappearance of the CUC will come quickly for the companies this year.

I don’t know about the population, but I think not as it would create too much uncertainty,” he said.

Some Cubans aren’t taking any chances and are cashing in CUCs at the 24-peso rate now, questioning Castro’s promise to make good on its value when “Day Zero” arrives.

Omar Laviña, owner of a sandwich store in Old Havana, was still showing prices in CUC and pesos.

“Many people are going to convert their money into US dollars and euros because they will always be around,” he said. “In my case I’m keeping it in local currency.”

Reuters

European banks addiction to Russia Hundreds of local banks dominate Russia’s banking system

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rench banks have about US$50 billion of loans to Russia’s public sector, companies and individuals, according to the Bank for International Settlements (BIS), accounting for a fifth of foreign lending there and more than banks from any other country.

The European Union has imposed sanctions on some Russian officials and the EU and United States are expected to apply more economic penalties against Russia if a crisis over the Crimea escalates.

Hundreds of local banks and some big domestic firms, including Sberbank, VTB and Gazprombank, dominate Russia’s banking system.

Foreign banks have a limited role -the biggest are France’s Societe Generale , Italy’s UniCredit and Austria’s Raiffeisen .

A bigger issue for most foreign banks than retail banking exposure is likely to be any adverse effects on capital markets activity. Most of the

world’s big investment banks are involved in Russia and compete with domestic firms on trading, equity and bond issues and advisory work. Some big bond deals are under particular scrutiny at present, one banker said.

Overseas banks had US$242 billion of loans to Russia at the end of September, according to the BIS data, which tracks cross-border lending from 24 of the world’s major countries.

European banks accounted for US$184 billion of the foreign lending to Russia, or 76 percent. U.S. banks had US$36.7 billion of exposure and Japanese banks had US$16.3 billion.

In Europe, French banks had US$50.9 billion of exposure to Russia.

Italian banks had loans of US$28.6 billion, German banks had exposure of US$23.7 billion, British banks had US$19.1 billion, Dutch banks had US$17.6 billion, Swedish banks had US$14 billion and Swiss banks had US$6.8 billion, according to the BIS data.

US$184 billion European lending to Russia

Only SocGen, UniCredit and three other banks listed Russia as one of their top 10 country exposures under data released by the EU’s bank regulator last year. Analysts said those banks could reduce their exposure if the Russian economy deteriorates, as lenders have done in Ukraine.

Reuters

business daily 15 15

March 2014 Friday 19, April 19, 2013

Opinion Business

wires

Politics-Proof Economies?

Leading reports from Asia’s best business newspapers

Thanh Nien News In August 2013, the Communist Party’s decisionmaking Politburo allowed Vietnamese meeting certain criteria to gamble in a casino to be built in the Van Don Economic Zone in Quang Ninh Province bordering China. Vietnamese tycoon Dao Hong Tuyen and US firm ISC Corporation are investing in the US$7.5 billion project that includes a casino, marinas, a convention centre and golf and tennis clubs. Since that decision, at least 10 provinces have raced to win a casino license in their localities.

Bangkok Post Cabinet lifts state of emergency. The decision was widely expected after the Civil Court set strict conditions for the Centre for Maintaining Peace and Order (CMPO) in handling anti-government protesters, saying their rallies to oust caretaker Prime Minister Yingluck Shinawatra were peaceful, in its ruling on Feb 19. The government was also under pressure from the business sector to lift the emergency decree. They argued that it damaged the tourism industry and many travellers had decided to visit other destinations instead.

The Jakarta Post Banks in Indonesia are becoming less attractive to Malaysian financial institutions because of ownership restrictions. RAM Ratings co-head of financial institution ratings, Wong Yin Ching, said while Indonesia was still an attractive proposition, prospective suitors were more cautious, given the 40% cap on single ownership of domestic banks there. “This will be punitive on capital, as banks are required to deduct non-consolidated entities from common equity Tier-1 capital under Basel III. Other countries that Malaysian banks are interested to expand to include the Philippines, Cambodia, Vietnam and Thailand,” she added.

Myanmar Times The Internal Revenue Department (IRD) has publically disclosed the names more than 10,000 local businesses guilty of tax evasion in the 2012-13 fiscal year though the government agency now admits that some of those listed were made in error, said an official. The list, which was published on the IRD website on March 6, includes a total of 10,670 local companies, included local tycoon, Tay Zaw’s Asia Green Development Bank Ltd (AGD Bank), IRD Director U Tin Htun Naing announced during a press conference held jointly between the IRD and AGD Bank yesterday.

Michael Spence David Brady Nobel laureate in economics, is Professor of Economics Deputy Director and Senior Fellow at the Hoover Institution

at New York University’s Stern School of Business and Professor of Political Science at Stanford University.

and Senior Fellow at the Hoover Institution

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overnments’ inability to act decisively to address their economies’ growth, employment, and distributional challenges has emerged as a major source of concern almost everywhere.

In the United States, in particular, political polarization, congressional gridlock, and irresponsible grandstanding have garnered much attention, with many worried about the economic consequences.

But, as a recent analysis has shown, there is little correlation between a country’s relative economic performance in several dimensions and how “functional” its government is.

In fact, in the six years since the global financial crisis erupted, the US has outperformed advanced countries in terms of growth, unemployment, productivity, and unit labor costs, despite a record-high level of political polarization at the national level.

Of course, one should not paint with too broad a brush. Unemployment is lower in Germany, Canada, and Japan. And America’s income distribution is more unequal than most advanced countries’ – and is trending the wrong way. Still, in terms of overall relative economic performance, the US clearly is not paying a high price for political dysfunction.

Without dismissing the potential value of more decisive policymaking, it seems clear that other factors must be at work. Examining them holds important lessons for a wide range of countries.

Our premise is that the global integration and economic growth of a wide range of developing countries has triggered a multi-decade process of profound change.

These countries’ presence in the tradable sector of the global economy is affecting relative prices of goods and factors of production, including both labor and capital. At the same time, declining semi-conductor costs have encouraged the proliferation of information and communication technologies that are replacing labor, disintermediating supply chains, and reducing routine jobs and lower-value-added jobs on the tradable side in advanced economies.

These are secular trends that call for forward-looking assessments and long-term responses. Relatively myopic policy frameworks may have worked reasonably well in the early postwar period, when the US was dominant, and when a group of structurally similar advanced countries accounted for the vast majority of global output. But they cease working well when sustaining

growth requires behavioral and structural adaptation to rapid changes in comparative advantage and the value of various types of human capital.

What, then, accounts for the US economy’s relatively good performance in the post‑crisis period?

Many countries must undergo structural adjustment in order to achieve sustainable growth patterns.

All advanced economies’ structures and portfolios of employment opportunities are facing similar competitive and technological forces

The main factor is the American economy’s underlying structural flexibility. Deleveraging has occurred faster than in other countries and, more important, resources and output have quickly shifted to the tradable sector to fill the gap created by persistently weak domestic demand.

This suggests that, whatever the merit of government action, what governments do not do is also important.

Many countries have policies that protect sectors or jobs, thereby introducing structural rigidities. The cost of such policies rises with the need for structural change to sustain growth and employment (and to recover from unbalanced growth patterns and shocks).

No country is frictionless in this regard, but there

are substantial differences.

Relatively speaking, Germany, northern Europe, the United Kingdom, Canada, Australian, New Zealand, and the US are relatively free of structural rigidities. Japan intends to get there. Southern Europe has a substantial agenda of flexibility-enhancing reform ahead of it.

Removing structural rigidities is easier said than done. Some stem from social-protection mechanisms, focused on jobs and sectors rather than individuals and families.

Others reflect policies that simply protect sectors from competition and generate rents and vested interests.

In short, resistance to reform can be substantial precisely because the results have distributional effects.

Such reform is not market fundamentalism. The goal is not to privatize everything or to uphold the mistaken belief that unregulated markets are selfregulating. On the contrary, government has a significant role in structural transitions.

But it must also get out of the way.

Relative to the US, Europe has two sets of problems. One is the need, especially in several southern European countries, to enhance structural flexibility and boost productivity. In the euro’s first decade, the southern economies’ unit labor costs diverged from those in Germany and the north, with growth sustained either by excess public debt and the government component of domestic aggregate demand, or, in the case of Spain, by a leveraged housing bubble. In the absence of the exchangerate mechanism, resetting the system to allow the tradable sectors to generate growth involves painful relative deflation, a process that takes longer in a low-inflation environment.

Second, the eurozone permits

these divergences because policies that affect growth are decentralized. The common currency and monetary policy are in constant tension with decentralized policymaking on taxation, public-sector investment, and social policies – all of which affect countries’ structural flexibility. Moreover, the single market is relatively complete in goods but not in services.

This is not a stable situation.

Europe eventually must gravitate either toward deeper political, fiscal, and policy integration, or toward a structure that includes adjustment mechanisms – for example, greater labor mobility – to accommodate divergences in productivity.

Many countries, not only in Europe, must undergo structural adjustment in order to achieve sustainable growth patterns. All advanced economies’ structures and portfolios of employment opportunities are facing similar competitive and technological forces, and all are tending to shift income toward the upper end of the distribution and toward owners of capital.

The cross-country differences in performance partly reflect past policy choices affecting the speed of adjustment.

Initial conditions matter, and in this respect America’s policy framework seems to have ensured the US economy’s relatively higher resilience not only to the global crisis, but also to domestic political volatility.

Structural flexibility is not the whole answer; higher levels of public-sector investment would also help to generate sustainable recovery, especially in the advanced countries. But, with severe fiscal constraints in many countries likely to delay that element of the policy response, flexibility-enhancing reforms are the right place to start.

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March 19, 2014 Friday April 19, 2013

Closing Global recording industry optimistic

Star-studded Asian Film Awards at CoD

Top executives of the global recorded music industry said yesterday they were optimistic about growth despite figures for 2013 showing an almost 4 percent annual decline in revenues to US$15 billion, blamed largely on the Japanese market.

The drop-off followed figures in 2012 which showed the industry, hard hit by illegal downloads and music piracy, registering its first revenue gains since 1999, to US$16.5 billion. In its latest annual report, the London-based industry federation IFPI said most of the decline in 2013 was due to a 16.7 percent revenue slump in Japan, which is making a belated transition away from physical products like CDs to digital delivery via the latest technology.

The 8th Asian Film Awards ceremony will be held in the Dancing Water Theatre of City of Dreams on March 27 (Thursday), the first time that Macau has hosted the event, organiser Asian Film Awards Academy announced. The Academy, formed of representatives from Hong Kong, Busan and Tokyo International Film Festivals, have positioned the ceremony as an “Asian Oscar” event, executive committee chairman of the Academy Wilfred Wong Ying Wai informed a press briefing yesterday. Mr Wong also remarked that the Academy would like to see Macau - although not yet having a mature film industry - become a hub for syndication of movies in tandem with Hong Kong.

Payments off

Third-party payment systems to be reined in by legislation

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hina’s central bank is considering regulations that would significantly limit the use of third-party payment systems, including the payment arms of Alibaba Holding Group and Tencent Holdings Ltd .

The People’s Bank of China released draft rules last week to major banks for consultation, state media reported on Monday. The measures would ban the payment companies from

handling offline transactions.

They would also heavily limit spending by individuals using third-party payment platforms and transfers from bank accounts to accounts managed by third-party companies. The draft rules restrict single purchases using third-party payment accounts to 5,000 yuan (US$810), with a monthly limit of 10,000 yuan.

“We have reported our opinions to, and are in close

communication with, the PBOC,” said a spokesperson with Alipay, Alibaba’s payment platform. “Given that the document is now under consultation, we are not able to comment further.”

Alibaba said on Sunday it had picked the United States for a long-awaited initial public offering, ending months of speculation about where it would float and deal a blow to the Hong Kong stock exchange.

China’s online and mobile payment transactions have been growing at a frenetic pace. The online payment market last year increased by 47 percent to 5.37 trillion yuan (US$869.20 billion) in transactions, according to Beijing-based consultancy iResearch.

That has fuelled a clash between the financial sector and internet companies, as online firms push into banking and ramp up their own

financial services, offering online payment options and wealth management products.

Last week, China’s central bank suspended the use of payments made by scanning a type of bar code with mobile devices, halting the rollout of new virtual credit cards by Tencent and Alibaba.

Both companies announced they would launch cards, which can use QR bar codes scanned by smartphones to process payments, in partnership with China CITIC Bank Corp The draft rules would also restrict one-time money transfers via individual thirdparty payment accounts to 1,000 yuan, with a cap placed on a cumulative annual transfer of 10,000 yuan, hitting the ability for users to move their money into wealth management products offered by Tencent and Alibaba.

In February, Alipay said it handled 900 billion yuan in mobile payment transactions from more than 100 million users last year, completing more mobile payments than U.S.-based PayPal and Square Inc combined.

A central banker who helped draft the new proposals told Caixin Media that the new rules were intended to limit the operating scope of thirdparty payment companies to online shopping, while prohibiting offline payments.

Reuters

More than time to go green

Portuguese less satisfied Portugal buys back 50 mln euros of bonds with democracy

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A

housands of companies across China must start reporting their greenhouse gas emissions under a government plan to build a nationwide emissions database ahead of launching a national carbon market.

The National Development and Reform Commission (NDRC), China’s top economic planning agency, said in a note on its website that all companies that emitted more than 13,000 tonnes of carbon dioxide equivalent (CO2e) in 2010 must report their future annual emissions of all six major greenhouse gases.

“The reporting is to tighten the control over major emitters, provide statistics for capping greenhouse gas emissions and launch a carbon trading scheme,” the note said.

It did not specify when mandatory reporting would begin, but analysts told Reuters they expected the rule to enter into force from 2015.

China is the world’s biggest emitter of greenhouse gases, blamed by scientists for causing global warming, but has pledged to cut emissions per unit of GDP by 40-45 percent by 2020, compared with 2005 levels.

Reuters

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European study to be presented on Tuesday concluded that the Portuguese are less and less satisfied with democracy, but the study added the result was “understandable” given the worsening economic and social conditions.

The 6th European Social Survey “Meanings and assessments of democracy”, which gathered data in 23 countries, including Portugal, analysed people’s and politician’s opinions about the issue.

“The figures suggest that the idea that social justice is closely connected to democracy is particularly intense in countries with greater inequalities in incomes, which clearly includes Portugal”, said the document seen by Lusa.

The Portuguese feel “the greatest democratic deficits” are in how the courts work, in the government’s ability to ensure social justice and “in the feeling of a lack of popular control over political power”, in other words, governments do not explain their decisions to the voters and there are insufficient direct democracy mechanisms.

ortugal’s government debt agency bought back 50 million euros (US$69 million) of bonds due in October 2015 as it tries to smooth out debt repayments with the end of the country’s bailout programme approaching in two months.

Following today’s buyback, the security due in October 2015 has 8.15 billion euros outstanding, said the Lisbon-based debt agency, known as IGCP. The IGCP on Feb. 27 also bought back 1.03 billion euros of bonds due in October 2015 and 293 million euros of securities maturing in October 2014. The country also held a 6.64 billion- euro debt exchange on Dec. 3 to push back repayments on securities maturing in 2014 and 2015 to 2017 and 2018.

Portugal is trying to regain full access to debt markets with the end of its 78 billioneuro rescue programme from the European Union and International Monetary Fund approaching on May 17.

Lusa

Bloomberg