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Tokyo trouble: Okada v. Wynn

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One Central towers prop up Shun Tak

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housing market

Brazil and Macau – a winning team

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News where it matters

faces fresh cooling

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he government is considering a new round of measures to cool the property market. In June the average price of residential transactions was around 50 percent higher comparing to the same period last year. A working group to promote what’s described as the sustainable development of the real estate sector said yesterday “there is somewhat of an overheating of the property market”. The group has launched studies on four topics: mortgage loans, real estate taxes, sales of unfinished

flats and quickening the approval of construction projects. In the past when the government has wanted to make changes in public policy it has used working groups both to formulate ideas and test public reaction. It’s only a year since a special 20 percent stamp duty on the sale of unfinished flats was introduced to discourage people from selling on title before properties are even habitable. The levy is reduced to 10 percent if the transaction takes place two years after purchase.

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HANG SENG INDEX

A close call for political reform

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The government-backed political reform has made it out of the Legislative Assembly in time for implementation before next year’s elections. But a provision on indirectly elected seats was unexpectedly close to not getting the necessary two-thirds of the votes and was only saved by the unprecedented vote of Assembly president Lau Cheok Va.

Selling out means buying in

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Analysts have welcomed the HK$5.85 billion (US$754 million) sale of a near seven percent stake in casino operator Galaxy Entertainment Group by private equity firm Permira Advisers LLP. They say the deal – known as a reverse inquiry where other investors approached Permira asking it to sell – shows faith in the Galaxy story and the wider Macau gaming market despite the recent revenue slowdown.

Name

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La Scala appeal could reach court

%Day

HENGAN INTL

3.03

CHINA RES ENTERP

2.86

CHINA LIFE INS-H

1.97

CHINA MERCHANT

1.92

SANDS CHINA LTD

1.26

CATHAY PAC AIR

-1.41

ALUMINUM CORP-H

-1.92

COSCO PAC LTD

-2.31

CHINA COAL ENE-H

-2.55

WANT WANT CHINA

-4.54

Source: Bloomberg

The developer of residential project La Scala is not giving up on the plots. Chinese Estates Holdings Ltd has filed an objection asking Chief Executive Fernando Chui Sai On to review its decision and warned that, unless it gets a favourable reply by September 14, it will go to court. The government has received the appeal but isn’t commenting. Page 4

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2012-8-31

2012-9-01

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Year I - Number 109 Thursday August 30, 2012 Editor-in-chief: Tiago Azevedo Deputy editor-in-chief: José I. Duarte MOP 6.00


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business daily August 30, 2012

macau

Okada sues Wynn for defamation Tokyo lawsuit latest round in eight-month battle

Steve Wynn and Kazuo Okada – making work for lawyers

U

niversal Entertainment Corp., controlled by Japanese billionaire Kazuo Okada, is suing the latter’s former business partner Steve Wynn and Wynn Resorts for defamation. The 11.2 billion yen (US$142 million) being sought in damages via a Tokyo court is equivalent to roughly one sixth of the money Mr Okada lost when his 20 percent stake in Wynn was forcibly redeemed by the company at a 30 percent (US$800 million) discount in February. Wynn had claimed that month Mr Okada was “unsuitable” as a business partner. It said he had breached his fiduciary duty by making improper payments to Philippine gambling regulators. Mr Okada – who made his fortune in pachinko, a Japanese arcade game – is developing a US$2 billion casino resort in the Philippines. He has denied his company has done anything improper to obtain

favours from that country’s regulators or government. The Wynn assertion of Mr Okada’s “unsuitability” echoes the language used by Nevada gaming regulators when they are assessing gaming licence applications. Tokyobased Universal Entertainment says the term defamed it and caused it damage. The defamation claim is the latest skirmish in an eight-month-long saga, during which Mr Okada and Mr Wynn have also sued each other in the United States.

Former allies Until this past winter, Mr Okada was the largest single shareholder in Steve Wynn’s US$11 billion casino business, which has casinos in Las Vegas and Macau. The Japanese entrepreneur helped bankroll Mr Wynn’s operations for more than a decade.

The two fell out publicly in January when Mr Okada filed a lawsuit in the U.S. against Wynn for blocking his access to financial documents relating to a 1.1 billion patacas (US$137 million) donation by Wynn to the University of Macau. An investigation commissioned by Wynn into Mr Okada conducted by former FBI Director Louis Freeh alleged Mr Okada had violated U.S. anti-corruption laws. Both self-made billionaires claim the other made improper payments to win favour in their respective Macau and Philippines markets. “We assume this is another attempt to distract from the real i s s u es , ” s a i d a Wy n n R e s o r t s spokeswoman in response to the Tokyo lawsuit, adding the Las Vegas-based company hadn’t seen the Tokyo court papers. Mr Okada has already been removed from the board of Wynn

Macau Ltd., a unit of the U.S. company. The parent Wynn Resorts needs shareholder approval to remove Mr Okada from that boardroom as well. In the meantime, District Judge Elizabeth Gonzalez in Clark County Las Vegas, has scheduled a hearing for October 2 on arguments whether Mr Okada’s request for documents – including ones regarding Wynn Resorts’ dealings with Macau officials going back as far as 2000 and the company’s use of US$120 million he invested in 2002 – is reasonable. Mr Okada will appear on September 18 in Las Vegas for a deposition by Wynn Resorts’ lawyers, according to a notice filed by the casino firm’s legal team. Wynn Resorts will have 10 days after they question Mr Okada to supplement their arguments against document disclosure, according to the filing. Bloomberg/Reuters

Adelson’s bet on Romney hints at big casino win Republican presidential nominee wants yuan to rise

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heldon Adelson’s support for Republican Party U.S. presidential candidate Mitt Romney could have direct benefits for Mr Adelson’s Macau casino business Sands China, suggests a Bloomberg News report. The media outlet says Mr Romney wants to pressure China to raise the value of its currency the yuan, relative to the U.S. dollar. His opponent President Barack Obama also says the yuan should rise, but Mr Romney has reportedly been more aggressive. He has stated China should be called a currency manipulator for suppressing the yuan’s value, though he is likely – outwardly at least – to be more diplomatic if he wins power. Given that most bets in Macau casinos are denominated in Hong Kong dollars – a currency pegged to the U.S. dollar – then even a small appreciation of the yuan could strengthen Sands China’s top and bottom lines significantly, given the betting volumes in Macau. The parent Las Vegas Sands Corp., which develops, owns and operates four casino resorts in Macau, accounted

for US$2.95 billion of the company’s global US$5.34 billion in revenue in the first half of this year, according to its second-quarter earnings report.

Appreciate, accumulate “Even a small adjustment [in the yuan’s value] would have a multimillion-dollar impact,” says the Bloomberg report. “If the yuan appreciated only five percent this year, and just half of Macau gamblers changed their money from yuan, Sands China’s revenue for the first half of this year could rise by as much as US$73.8 million,” it adds. LVS officials were asked in a 2010 earnings call what would happen if China loosened restrictions on its currency, possibly causing it to rise. “It’ll have a big meaning in Macau, and, of course, we’re all in favour of that,” Mr Adelson said. China manages how the yuan trades against the U.S. dollar, allowing it to rise and fall within a limited band around a daily fixing set by the central bank. The currency has weakened 0.9 percent this year,

Sheldon Adelson – likes Romney’s calls for a stronger yuan

trimming its accumulated advance – since a dollar peg ended in July 2005 – to 30.2 percent. Mr Adelson is worth about US$20 billion according to the Bloomberg Billionaires Index. He and his wife have given about US$36 million to

Republican so-called super-PACs (political action committees) so far during this election cycle. The couple contributed US$10 million in June to Restore Our Future, which is dedicated to backing Mr Romney. Bloomberg


August 30, 2012 business daily | 3

MACAU

U.S. investor buys Permira shares in Galaxy Market sees sale as vote of confidence in casino op and Macau generally Associate Editor

Looking up – Galaxy share sale positive for company and local casino industry

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addell & Reed Financial Inc., a Kansas-based asset management company, bought two-thirds of the nearly seven percent stake in Macau casino operator Galaxy Entertainment Group Ltd sold by U.K. private equity firm Permira Advisers LLP on Tuesday. FinanceAsia reported Permira raised HK$5.85 billion (US$754 million) in the sale. Galaxy climbed as much as 5.5 percent yesterday to HK$23.10 – the highest since May 4 – before falling back slightly to close at HK$22.65, up 3.42 percent on the day. Galaxy confirmed in a filing to the Hong Kong Stock Exchange that two Permira vehicles had sold approximately 278.8 million shares

representing 6.65 percent of the casino firm’s stock “through private placement to a small selective group of investors on 28 August 2012.” GEG added: “Completion of the sale is expected to be on 31 August 2012. After the sale, the remaining shareholdings of the Permira funds would reduce to 5.95 percent of the issued shares of GEG.” FinanceAsia reported the price per share as HK$21. Permira originally bought the stock in 2007 at HK$7.80 per share, so its asset has grown nearly 170 percent.

Overhang lifted Concerns that Permira, which in September sold 270 million shares in

the casino operator, could sell more of Galaxy had been an “overhang” on the stock, said Gary Pinge, an analyst at Macquarie Securities Ltd. The fact Permira has decided to hold on to nearly six percent of GEG after nearly tripling its initial investment appears to be a vote of confidence in Galaxy and its management. “The removal of that overhang is a positive,” said Mr Pinge. “The papers are quoting it was a reverse inquiry, which is basically investors calling Permira asking if they want to sell, which gives you an indication of the level of demand.” Permira has taken advantage of a recent 30 percent rise in the Galaxy share price to trim its holdings further as Macau’s gaming industry

One Central sales salvage Shun Tak A slowdown in the conglomerate’s overall profit was masked by a boom in sales of One Central flats Vítor Quintã

vitorquinta@macaubusinessdaily.com

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ith Macau residential property One Central almost sold out, conglomerate Shun Tak Holdings Ltd has seen its profits grow more than fourfold in the first half of this year. The company led by Pansy Ho Chiu King told the Hong Kong stock exchange its profits had topped HK$1 billion (US$129 million), up from just HK$222 million a year earlier. But Shun Tak admitted that its takings would have been just HK$97 million if it wasn’t for a revaluation surplus of HK$907 million from its 51-percent stake in One Central. During the first half three duplex units and two triplex units at One Central were sold “with satisfactory prices,” the company said, along with eight serviced apartments of The Residences and Apartments at Mandarin Oriental.

By June, 99 pct of One Central’s seven residential towers had been sold, Shun Tak says

At the end of June, 99 percent of the seven residential towers had been sold and only two service penthouses, which are scheduled for launch at a later stage, remain.

“With the lack of first-hand property launches in Macau over recent months, the market has accumulated considerable demand for new quality homes,”

enters a more steady but slowergrowing phase. Another possible factor influencing the timing of the sale said an industry source was a windfall from currency price fluctuations. When Permira bought its Galaxy stake in 2007 Business Daily understands it paid for it in euros. Since then the eurozone debt crisis has seen the Hong Kong dollar appreciate against the euro.

Major player The U.S. main buyer on Tuesday – Waddell & Reid, a mutual fund – already has significant investment exposure to the Macau gambling market. It is the biggest single shareholder in Wynn Resorts Ltd, the parent of Wynn Macau Ltd, with a 16.4 percent stake, according to Bloomberg data. It also holds a 4.6 percent stake in Sands China Ltd, the Macau unit of Las Vegas Sands Corp. Waddell & Reid’s purchase is a reversal of its recent dealings in the Macau market. In June the investor announced plans to sell shares in Sands China and Wynn Macau in order to raise US$250 million. Because Waddell & Reed the main buyer in Tuesday’s deal wasn’t holding any other Galaxy stock, its purchase will not trigger the five percent ownership reporting threshold of the Hong Kong Stock Exchange. Permira’s original US$842 million equity exposure to GEG and its parent, Hong Kong-listed building materials business K. Wah, was purchased in November 2007. It lost 94 percent of its value within a year of the deal, thanks to the global financial crisis in the autumn of 2008. But by June 2011 Permira’s Galaxy investment had more than doubled from its original value to reach US$1.7 billion. In September that year Permira sold 270 million shares in Galaxy for HK$4.8 billion. That meant it still retained 12.8 per cent of Galaxy’s issued capital. Permira described GEG at the time as “a very successful investment” with “attractive longterm growth potential for Macau and the company”. With Bloomberg

Shun Tak wrote. “Under this environment, Nova Park and special featured units at One Central Residences have attracted significant interest,” the group added. Pre-sales for Nova Park, the fourth phase of Taipa residential development Nova City, were launched in March and Shun Tak has already sold 333 apartments. The three residential towers should be ready by the fourth quarter of 2014, the company said. Shun Tak is also planning to start the construction of the fifth phase of Nova City. It will include eight residential towers, in the last quarter of this year. The conglomerate’s ferry operations rebounded from last year’s loss to post a profit of HK$2 million during the first half of 2012. Passenger volume rose by 26 percent and Shun Tak also benefited from a fare hike approved by the government in July 2011 but also from “signs of slowdown in hiking fuel costs”. Meanwhile over 3,000 niches of the 40,000 niches available at the company’s columbarium, Taipa Hills Memorial Garden, have already been sold. In January legislator Ho Ian Sang accused of Shun Tak of breaching the plot’s concession contract by selling burial niches to families from outside Macau.


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business daily August 30, 2012

macau Region promotes tourism to Indian travellers Macau Government Tourist Office, Hong Kong Tourism Board and Tourism Administration of Guangdong Province have launched joint promotion activities in three Indian cities. The aim is to promote tourism in the Pearl River Delta, including travel itineraries with multi stops, among their local media and trade. The event is aimed at developing new visitor sources and attracting Indian quality visitors to Macau in order to diversify the tourist market. The number of India visitors to Macau increased from nearly 10,000 in 2003 to 170,000 in 2011.

Chinese Estates fights to keep La Scala land The developer of La Scala formally objects to the annulment of the grant of land for the housing project

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he developer of La Scala has asked the Chief Executive Fernando Chui Sai On to review the government’s repossession of the land for the upmarket housing project, and warned that unless it gets its way it will take its case to court. The developer, Chinese Estates Holdings Ltd, told the Hong Kong Stock Exchange yesterday that subsidiary Moon Ocean had formally objected to the government’s revocation of the 2006 land grant. A government spokesperson confirmed the government had received the objection, that it would consider it in the light of the Court of Final Appeal’s judgement in the last trial of former secretary for transport and public works Ao Man Long, and decide on it in due course. The government revoked the land grant after the Court of Final Appeal found this year that Chinese Estates boss Joseph Lau Luen Hung and BMA Investment Group Ltd chairman Steven Lo Kit Sing had given Mr Ao a bribe of HK$20 million (US$2.6

The cancellation of the La Scala land grant could end up in the courts (Photo: Manuel Cardoso)

million) to get the land. Mr Lau and Mr Lo are due to go on trial on September 17, facing charges of bribery and money laundering arising from the La Scala land grant. Both men have denied any wrongdoing.

Chinese Estates said it would take its case to court if it did not receive a favourable reply to its objection before September 14, the deadline for appealing to the Court of Second Instance against the government’s decision. Ao’s successor as secretary for

transport and public works, Lau Si Io, said this month that he expected Chinese Estates to appeal. Mr Lau also said he would review the grant for extra land for La Scala finalised last year.

Emperor Watch sales stall amid retailing boom The watch and jewellery chain’s rising costs of sales squeeze its net profit margin

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mperor Watch & Jewellery L t d ’ s n e t p r o f i t m a r gi n narrowed to 6.9 percent in the first half of this year from 9.7 percent at the same time last year. Emperor Watch told the Hong Kong Stock Exchange that its first-half sales in Macau amounted to HK$181 million (US$23.34 million), about 1 percent less than a year before. The takings of Macau’s retailing industry jumped by more than 50 percent in the first half. Emperor Watch’s five shops here accounted for just 5.7 percent of its first-half sales revenue. The company has 21 shops in Hong Kong, which made almost 84 percent of its sales. Its 60 outlets in the mainland made 10.3 percent of its sales. Emperor Watch’s total first-half

revenue rose by 20.3 percent to HK$3.16 billion. But higher costs of sales ate up much of this revenue growth and squeezed its profit margin. Earnings before interest, depreciation, tax and amortisation were the equivalent of 13.4 percent of revenue, just over 3 percentage points less than a year before. Net profit was the equivalent of 17 percent of revenue, also just over 3 percentage points less than a year before. Emperor Watch estimates that its basic earnings per share in the first half were 3.3 Hong Kong cents, compared with 4.2 Hong Kong cents a year before. The company paid a final dividend of 1.6 Hong Kong cents a share for 2011.

Watches and jewellery are a big hit with tourists

V.Q.


August 30, 2012 business daily | 5

Photo: Manuel Cardoso

MACAU

Govt eyes new ways to curb home prices Government working group says the housing market is overheating, a sign of further measures to curb prices Vítor Quintã

vitorquinta@macaubusinessdaily.com

T

he government has opened the door to new measures to cool the housing market, only a year after imposing the special stamp duty on the sale of unfinished flats. A government working group on the housing market, led by Secretary for Transport and Public Works Lau Si Io, said yesterday that the market was “somewhat overheating”. The average price per square metre of residential space rose to 58,976 patacas (US$7,380) in June

from 53,083 patacas in May. The price in June was about 50 percent higher than a year before. Just before the special stamp duty was imposed the average price per square metre was 39,174 patacas. The special stamp duty of 20 percent applies to homes bought and sold within a year of purchase. The levy is reduced to 10 percent if the sale takes place two years after purchase. In a statement yesterday, the working group has looked at the

special stamp duty and concluded that “it has yielded positive results” and should be retained. The president of the Macau General Association of Real Estate, Chong Sio Kin, said in February that the special stamp duty was harmful and should be dropped. The stamp duty is not due to be officially reviewed until the middle of next year. But the working group said it did not exclude the possibility of the

government taking further measures to cool the market. With this in view, the working group is studying four aspects of the housing market: mortgages, taxation, sales of unfinished homes and the time it takes the government to approve projects. The working group said it had examined in detail complaints by residents about foreign capital causing fluctuations in the real estate market. It said it was looking into ways of dealing with this.

Macau vineyard buyer tries to make peace Macau businessman Louis Ng issued a letter to appease new neighbours in Burgundy Xi Chen

xi@macaubusinessdaily.com

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ouis Ng Chi Sing, the chief operating officer of SJM Holdings Ltd, Macau’s largest gambling operator by market share, pledged his passion for wine in an August 28 letter over his purchase of a Burgundy vineyard that led to local backlash in France. The letter stated that a long-term lease with prominent Burgundy winemaker Eric Rousseau has been in place for the latter to oversee and manage Chateau de GevreyChambertin’s wine production. Mr Ng also stressed that he has already commissioned a wellrespected French architect Christian Laporte, who was the lead architect for the restoration of the winemaking monastery Saint-Vivant de Vergy, to renovate the chateau to “become one of the most beautiful buildings” in the region again. “It is our goal to bring this enchanted property to its full former glory, thus fulfilling its destiny as a part of this region’s rich cultural heritage for people not only from

Europe, but from all over the world to enjoy,” he said. “In time, I hope my new Burgundy neighbours will also come to appreciate my sincere passion for great wines, as will be reflected in the positive improvements I hope to bring,” he said. Mr Ng acquired the chateau, a 2.3-hectare vineyard in the Burgundy region in May for 8 million euros (79.9 million patacas), when the local buyers were only able to offer 5 million euros. The property itself was estimated to be worth around 3 million euros. This was the first Burgundy chateau to be bought by Chinese nationals, who had already bought 20 chateaux in Bordeaux, another region of France, the Telegraph reported. The same report revealed that this was not the first Chinese involvement in the traditional Burgundy region. In February, Chinese businessman Shi Yi had already entered into a partnership with a local grower to buy two hectares of Vosne-Romanee vines.

Louis Ng was the first Chinese national to buy into the traditional Burgundy wine-making region


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business daily August 30, 2012

macau Macau mobile subs reach 1.48 mln Macau ended July with 1.48 million mobile subscribers, up from 1.47 million in June, according to figures from regulator DSRT. The number of 2G subscribers has been falling in line with the transition to 3G and comprised 7,934 2G postpaid subscribers and 223 2G prepaid users at end-July. The number of 3G postpaid subscribers totalled 548,403 and the 3G prepaid base stood at 924,769. The number of Internet subscribers grew to 141,472 from 140,807 in June, and includes 796 dial-up users and 140,534 broadband customers.

Political reform takes final step The Legislative Assembly gave a nod to the political reform bills despite concerns over the two extra indirectly elected seats Tony Lai

tony.lai@macaubusinessdaily.com

T

he Legislative Assembly finally gave the green light to the revision of the two electoral laws, though some disagreed with the distribution of the two new seats for indirectly-elected legislators. Most legislators approved the addition of two directly elected and two indirectly elected seats in the final reading of the bills yesterday. The exceptions were José Pereira Coutinho and the New Macau Association trio of legislators. “These bills do not follow the democratic principles to promote the

local political development,” said Mr Coutinho. “It’s a step backwards.” Secretary for Administration and Justice Florinda da Rosa Silva Chan stressed: “The bills have acquired the biggest consensus from the society and … conform to the development of Macau.” However, more dissenting voices were heard expressing “reservations” on how the two indirectly elected seats are distributed. Legislator Melinda Chan Mei Yi said: “Among all the people I have

contacted with, they all agree to add a seat to the social and education sector.” The new law adds one seat to the professional sector, while the original social, culture, education and sport sector will be divided into the social and education sector, with one seat, and the culture and sport sector with two seats. There is a “double standard,” legislator Au Kam San pointed out, as the social and education sector had a greater presence than the culture and sport sector in the number of committee

members to elect the chief executive. This decision was made, the secretary said, because there are more cultural and sports associations eligible for voting (324) than social and educational associations (166). This explanation, however, could not persuade the assembly as this suggested provision had the support of only 19 out of the 27 legislators present – short of the two-thirds majority required. Legislative Assembly President Lau Cheok Va even stepped in to vote, making sure the bill got the necessary two-thirds of the votes. Ms Chan admitted there is “room for improvement in the indirect election”. The government will in the future set up a task force to try to refine such mechanisms, as well as the chief executive election. The law increasing the committee to elect the chief executive from 300 to 400 members passed with fewer difficulties – only the pan-democrat trio and Mr Coutinho voted against. The political reform will come into effect after being approved by Chief Executive Fernando Chui Sai On and published in the Official Gazette.

Legislator rejects public contract censure Accepting renovation works from the government is a “political obligation”, which is difficult to reject, and his company, Empresa de Construção Civil Man Kan, Ltda, does not benefit from these projects, said legislator Fong Chi Keong. He spoke to reporters yesterday after the administration directly awarded a project worth over 43 million patacas (US$5.4 million) to his company. Mr Fong said the government trusted his company’s experience in government projects, but he could not recall the number of such projects the company had since the handover.

Weather Beijing 33/21o C Changchun 29/17o C

Harbin 27/12o C

Xian 33/20o C Shanghai 32/26o C Chengdu 29/22o C Kunming 26/17o C Haikou 34/24o C Sanya 32/27o C

Guangzhou 34/25o C

MACAU (13-18 August) Day

Temperature

Humidity

08/13

25/29o C

75/95 %

08/14

26/31o C

60/95 %

08/15

27/32o C

55/90 %

08/16

27/31o C

60/95 %

08/17

27/31o C

60/95%

08/18

27/32o C

60/95 %

Shenzhen 34/26o C

ASIA (today)

Hong Kong 32/28o C

Manila

TOKYO

Jakarta

29/25o C

30/26o C

29/22o C

29/24o C

Macau 32/27o C

Bangkok

SEOUL

K. lumpur

31/24o C

SINGAPORE

29/22o C

31/26o C

taipei

33/26o C


August 30, 2012 business daily | 7

MACAU

Morning Star H1 profit tumbles by 86 pct After ditching its travel business to focus on property, Morning Star makes money on travel and loses it on property Tiago Azevedo

tiago.azevedo@macaubusinessdaily.com

M

orning Star Resources Ltd’s profit fell by 85.7 percent in the first half of this year from a year earlier. Morning Star told the Hong Kong Stock Exchange yesterday its first-half profit attributable to shareholders had fallen to HK$700,000 (US$90.249) from HK$4.9 million. Its revenue rose to HK$300.4 million from HK$287.1 million. The company’s profit was dragged down by an operating loss of HK$400,000, which contrasted with its operating profit HK$5.7 million a year earlier. Morning Star is in the property development and travel businesses. Its travel business includes Morning Star Travel Service (Macau) Ltd which has 14 travel agencies here and in Hong Kong. First-half sales revenue from the travel and tourism business grew by 10.4 percent to HK$298.5 million and profit increased by 16.6 percent to HK$1.4 million. But the expenses of the travel and tourism business grew faster. Its operating costs increased by 22.1 percent. Depreciation costs increased by 178.5 percent and rent by 14.9 percent. The company’s property business made a first-half loss of HK$2.9 million, having made a profit of HK$1.4 million a year earlier. The property business’s revenue dropped to HK$1.8 million from HK$16.7 million.

Morning Star’s travel business made a first-half profit of HK$1.4 million (Photo: Manuel Cardoso)

Morning Star is disposing of its travel business so it can invest in the property market. The company told the stock exchange on July 24 it had agreed to sell its travel business, which includes Morning Star (Macau), Star Travel, Morning Star (HK) and Morning Star Traveller, for HK$138 million. It also said Beijing Morning Star would be would-up within

Electricity output doubles even without natural gas CEM forced to burn costlier fuel oil with natural gas supplies suspended Vítor Quintã

vitorquinta@macaubusinessdaily.com

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ompanhia de Electricidade de Macau – CEM, SA doubled the amount of electricity it generated in the second quarter, official data show, even though imports of natural gas remained suspended. Statistics and Census Service data released yesterday show producer and distributor CEM generated 215 million kWh in the second quarter, having generated 110 million kWh in the first. The utility increased its output by burning fuel oil, which is more expensive than natural gas. It used 36.2 million litres of fuel oil in the second quarter, more than twice what it used in the first. In the first half, the average import price of fuel oil rose by 19.2 percent to 6.46 patacas (US$0.81) a litre. CEM increased the price for its electricity paid by most consumers by 3.1 percent in April, from 1.28 patacas a kilowatt-hour to 1.32 patacas a kilowatt-hour. It warned that it might increase

its tariff again in the second half. The city is now much more dependent than before on imported electricity, which made up 81.9 percent of power consumed in the second quarter. CEM cannot burn natural gas to generate electricity because blasting on Hengqin Island for road construction means the supply of natural gas has been suspended. The blasting should have ended last December but the gas supply has yet to resume. The energy regulator, Arnaldo Ernesto dos Santos, said last month that he expected the supply to resume “as soon as possible”. Electricity consumption has been growing for 11 years. In the first quarter it was 12.2 percent more than a year before at 1.1 million kWh. The growth of the gaming industry explained most of the increased consumption. It used 439 million kWh in the first quarter, 18.5 percent more than a year before.

12 months of the sale of its other travel subsidiaries “in view of the continuous loss-making”. Morning Star will then concentrate on developing and

managing property. At the close of trading yesterday, shares in Morning Star Resources shares had dropped by 0.56 percent to HK$0.18 each.


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business daily August 30, 2012

macau

Platform for Portuguese, a springboard to Spanish Macau could benefit from Brazil’s rise and create an opportunity to help Beijing interact more deeply with the Spanish-speaking world Xi Chen

xi@macaubusinessdaily.com

B

razil’s rise as an economic powerhouse is creating an opportunity for Macau to assert itself on a world stage, an expert in international studies says. Macau University of Science and Technology vice-rector Zhang Shuguang says the city should take advantage of its relationship with Beijing and benefit from the ’Brazilian decade’, a period of political stability and economic vibrancy with two important international events looming: the FIFA football World Cup in 2014 and the Summer Olympics in 2016. Mr Zhang’s comments came from a research roundtable for young academics on the city’s role in China’s external relations held at the university that ended on Tuesday. About 30 academics attended the meeting, half of which were leading scholars from the mainland. The research project was held for the first time this year, and is currently a pilot programme which the university hopes can become a regular event.

Beijing has leveraged on Macau’s unique heritage and legal structure to build stronger relationships with the eight Portuguese-speaking countries, including emerging powerhouses Brazil and Angola. Angola is already the mainland’s biggest supplier of oil, while Brazil is a major supplier of mineral resources and agricultural products. But Mr Zhang would also like to see the city take advantage of the Macau characteristics to reach Spanish-speaking countries.

Broader vision He said the Spanish-speaking countries were areas that other countries had not focused on. Graduates who are proficient in Chinese, English as well as in Portuguese or Spanish would be in high demand from international organisations. “Macau is also very special in its cultural heritage. It was one of the very first places in Asia to have the interaction between the West and the East,” Mr Zhang said.

The university has just started offering exchange programmes for students who are enrolled in the Portuguese and Spanish language degrees, with the option to study in Portugal, Brazil, Spain or Mexico. Mr Zhang said the university’s language degrees focused more on the human and social side of a language, with students also required to have knowledge in at least one professional field. He said the city needed to foster a culture to help higher education flourish and to promote it vigorously. The university’s roundtable was designed to promote dialogue between Beijing and the rest of the world. “By bringing in scholars and business leaders, Macau can be

a platform to promote dialogues between mainland China and the world,” Mr Zhang said. “The territory can also play an important role in the transnational context, where many rules are being formulated.”

Corporate Notebook

Asia Insurance profit increases in 2011 A

sia Insurance Co Ltd is a Hong Kong company thatcarries out general insurance activities in Macau. It has just published its 2011 results for its local branch. It made slightly more than 127 million patacas (US$ 15.9 million) in gross revenue last year, an 8 percent increase compared with 2010. According to that indicator, it was ranked fourth in Macau’s general insurance market, with a 2.9-percent share of the total insurance market, which translates into a loss of 0.2 percentage point in market share since 2010. That market share in the general insurance segment was equivalent to 9.3 percent. Workplace insurance and fire insurance provided most of the income, with 32 percent and 27.7 percent of the gross premiums, respectively. From this income the company generated an operating profit of almost 19.5 million patacas, which corresponds to 15.3 percent of gross income. After accounting for extraordinary profits and losses and tax provision, the branch generated a net profit of 18 million patacas, an increase of 26 percent relative to the previous year. The net equity, meaning – for a branch – the total of the operating funds and reserves, amounted to 74.8 million patacas.

Premium income

MOP127,115,386

Net profit MOP18,086,435 Net equity MOP74,836,324


August 30, 2012 business daily | 9

greater china

Beijing to lend Egypt US$200 million President Mohamed Mursi wraps up visit to China Malek, head of a business delegation accompanying Mr Mursi. Egypt wants to sign eight agreements with China, offering investment projects in agriculture, tourism and infrastructure, the report said.

Signed agreements

Egypt’s President Mohamed Morsi is in China on a three-day visit that included a meeting with his Chinese counterpart Hu Jintao

C

hina promised a US$200 million loan to Egypt and the two sides signed deals in agriculture, the environment and telecommunications as Egyptian President Mohamed Mursi sought to boost ties in a trip to Beijing. China Development Bank pledged the credit to the National Bank of Egypt, according to a deal that was signed after Mr Mursi met with his counterpart, President Hu Jintao, in Beijing last Tuesday. The agreement came on the first leg of Mr Mursi’s two-nation trip that will also include Iran, a stop that has raised concern in the U.S. and Israel about Egypt’s foreign policy.

Mr Mursi has signalled a foreign policy that may shift away from the U.S. ties built by Hosni Mubarak, his predecessor who was ousted in a mass uprising last year. “Since taking office, Mr President has chosen China as one of his first countries to visit and this fully shows that your country attaches great importance to the desire to develop relations with China,” Mr Hu said when the two leaders met in Beijing, according to a pool report. Egypt hopes to boost Chinese investment to US$3 billion from the current US$500 million, the state-run Al-Ahram newspaper reported yesterday, citing Hassan

No details were available about the China Development Bank loan. Other agreements signed by the two sides focused on issues including agriculture, the environment and tourism. China also agreed to provide Egypt with police cars, according to the agreements. A commentary published last Monday by China’s state-run Xinhua news agency said the two sides have maintained “steady and robust cooperation despite Egypt’s social turmoil.” Trade rose to US$8.8 billion last year, the report said. It said that China has extended its “helping hand” to push economic recovery in Egypt. It said the two sides want to work together on a range of international issues including the conflict in Syria, where China has vetoed UN resolutions aimed at speeding up Syrian President Bashar al-Assad’s departure. “Egypt could be a bridge for China to strengthen cooperation with the whole Arab world and the African continent within the UN and other international organisations,” the Xinhua commentary said. Bloomberg

PBOC asks for 28-day reverse repo demand

C

day reverse repo contract to the mix. The central bank has also pledged to use money market operations as its key tool to guide interest rates as part of a gradual liberalisation and reform of the way borrowing costs are set in the world’s second-largest economy. The PBOC routinely surveys traders one day before regular open market operations on Tuesday and Thursday.

China Life Insurance Co., the nation’s biggest insurer, rose by the most in more than a month in Hong Kong trading after reporting an expansion in new business value. The stock climbed 2 percent, the most since July 19, to HK$20.70 at the close of trading, extending this year’s rally to 7.8 percent. New business value, which measures profitability of new policies sold, rose 2.5 percent to 12.5 billion yuan (US$1.97 billion) in the first half, the company said in a statement to the Shanghai stock exchange on Tuesday. The expansion was “driven primarily by the better-than- expected margin uplift,” Barclays analysts, led by Mark Kellock, wrote in a report yesterday. “This suggests significant underlying product mix improvements.” With a profit decline “already in the price, the positive new business value growth and margin expansion, strong growth in book value and embedded value, and a much stronger solvency position are likely to be positively received by the market,” Mr Kellock said in the report. China Life said that profit in the six months to June 30 fell 26 percent, as it flagged August 6, joining smaller insurance companies, including China Pacific Insurance (Group) Co., in suffering from an almost 20 percent slump in the benchmark Shanghai Composite Index in the year ended June 30 as the nation’s economic growth cooled. Net premiums earned fell 5.2 percent as sales over bank counters dropped under tighter regulatory rules and the insurer boosted more profitable, longer-duration contracts.

Reuters

Bloomberg

PBOC seen reluctant to use blunter tools such as reserve rate cuts

so. The last cut was in May. Instead they have relied on regularly injecting and draining cash through reverse repos since May, but traders said the short tenor of the repos, first limited to 7 days, had the effect of draining base money. The central bank began to increase its use of 14-day reverse repos in recent weeks, and now appears poised to add the longer 28-

Agricultural Bank of China Ltd, the nation’s third-largest lender by market value, posted a 14 percent increase in second-quarter profit as lending and fee-based services income rose and provisions for bad loans dropped. Net income rose to 37 billion yuan (US$5.8 billion) from 32.6 billion yuan a year earlier, based on figures published by the Beijing-based lender yesterday. That compared with the 38.1 billion-yuan average estimate of 15 analysts surveyed by Bloomberg. Agricultural Bank’s profit growth, the strongest among China’s four largest state-controlled lenders for three straight years, may bolster capital and ease concern the company will need to raise funds as the world’s second-largest economy slows. Bank of China Ltd, the thirdlargest by assets, last week posted 5.3 percent profit growth, the slowest in three years. “This is still a young bank, listed for only two years, and it has made a lot of progress” catching up with its peers, Tang Hui, a Beijingbased analyst at Founder Securities Co., said before the announcement. The bank’s “natural advantage of having a low-cost deposit base can also help it fare better amid interest-rate deregulation,” than lenders outside rural areas. Set up by Mao Zedong in 1951 to finance rural cooperatives, Agricultural Bank was the first commercial lender established in China during Communist rule. The bank had 350 million customers and 23,465 domestic outlets at the end of June, more than any competitor. More than half of its locations are in less developed areas, contributing about 39 percent of first-half operating income. Agricultural Bank’s core capital adequacy ratio rose to 9.65 percent as of June 30, from 9.5 percent at the beginning of the year.

China Life rises on new business value growth

Govt wary of rebound in inflation, asset prices – dealer hina’s central bank surveyed primary dealers on potential demand for 28-day reverse bond repurchase agreements for the first time ever yesterday, traders said, as Chinese regulators seek to maintain market liquidity without re-inflating asset bubbles. This is the first time the People’s Bank of China (PBOC) has suggested it might use such a long-term instrument. “The PBOC’s intention to use longer-term reverse repos to manage money market supply once again signals its reluctance to take further easing steps, such as reducing RRR,” said a dealer at a major Chinese state-owned bank in Shanghai. “The government appears to be wary of a rebound of inflation as well as property prices. On the market side, more and more investors now accept the idea that reverse repos could be an effective quantitative tool to adjust short-term money liquidity,” she said. Traders have been expecting the PBOC to inject long-term liquidity through a third cut this year to banks’ reserve requirement ratio, but Chinese regulators have refrained from doing

AgriBank Profit Gains 14pct


10 |

business daily August 30, 2012

asia Tokyo Gas buys LNG from Malaysia Japan’s top city gas supplier Tokyo Gas said it has signed a basic agreement to buy 900,000 tonnes per year of liquefied natural gas (LNG) from Malaysia for 10 years from April 2015. The agreement was signed with Malaysia LNG Sdn Bhd, which is led by Malaysia’s state oil firm Petronas, the company said in a statement. The deal comes as a follow-up to an existing contract, due to expire at the end of March 2015, under which Tokyo Gas buys LNG from the Malaysia Dua LNG project.

Renesas shares jump on KKR reports Chipmaker share price surged by a record 35 percent Takako Taniguchi and Naoko Fujimura

R

enesas Electronics Corp. surged by a record 35 percent as a person with knowledge of the matter said KKR & Co. is in talks to spend about 100 billion yen (US$1.3 billion) buying shares of the unprofitable Japanese chipmaker. Renesas closed at 308 in Tokyo trading, the stock’s highest since July 10. New York-based KKR will take a controlling stake by the end of the year, the Nikkei newspaper reported earlier, without saying where it got the information. Renesas, whose customers include Apple Inc. and Nintendo Co., is trying to end losses exacerbated by falling demand for its system LSI chips, used for functions ranging from processing images for TV screens to crunching data. The Kawasaki, Japan-based company’s major shareholders agreed in July to provide Renesas with loans to help cover costs including worker buyouts and reorganization of its factories. “Considering the record of the current management, it may lead to positive changes if KKR shakes up the management,” Takeo Miyamoto, an analyst at Deutsche Bank AG, said

yesterday. “Investors who thought Renesas would go bankrupt and sold the shares bought them again after today’s [yesterday’s] report.”

Biggest shareholders The U.S. private equity firm presented the offer to Renesas stakeholders including its biggest shareholders NEC Corp., Hitachi Ltd and Mitsubishi Electric Corp. and main banks, the person said, asking to remain anonymous as the negotiations are private. NEC gained 6.5 percent, while Hitachi rose 1.1 percent in Tokyo. Mitsubishi Electric fell 0.2 percent. The Nikkei newspaper reported the planned investment earlier

5,000 jobs Renesas plans to cut to help end losses

yesterday. Renesas isn’t the source of the report, the Kawasaki, Japanbased company said in a statement to the Tokyo Stock Exchange. Steve Okun, a Hong Kong-based spokesman for KKR, declined to comment. A formal agreement will be made next month between the main creditor banks of Renesas and its shareholders, the Nikkei said. NEC and Mitsubishi Electric declined to comment, and Hitachi didn’t immediately return a phone call seeking comment. Japan’s chipmakers have struggled as South Korea’s Samsung Electronics Co. extended its dominance. Boise, Idaho-based Micron Technology Inc. agreed in July to buy Tokyo-based Elpida Memory Inc., after Elpida filed for bankruptcy protection.

Job cuts Renesas plans to cut 5,000 jobs and may close or sell as many as nine of its 18 domestic factories to help end losses, after falling demand for TVs and a drop in prices for computer

chips eroded earnings. The chipmaker’s three main shareholders, NEC, Hitachi and Mitsubishi Electric, will provide 49.5 billion yen in loans to Renesas in October, they said on July 31. Banks including Mitsubishi UFJ Financial Group Inc., Mizuho Financial Group Inc. and Sumitomo Mitsui Trust Holdings Inc. have a basic agreement with Renesas to continue offering

Thai Bev boosts F&N stake to near maximum level Latest move in a six-week tussle with Heineken Saeed Azhar and Eveline Danubrata

T

hai Beverage Pcl has raised its stake in Fraser and Neave Ltd to just below the level that would trigger a mandatory offer for the whole company, upping its challenge to Heineken NV’s bid for Asia Pacific Breweries Ltd (APB). ThaiBev, controlled by Thai billionaire Charoen Sirivadhanabhakdi, said late on Tuesday it had bought another 2.6 percent stake in F&N for S$316 million (US$252 million) to bring its interest to 29 percent. If it hit 30 percent, Thai Bev would be obliged to bid for all of the Singapore conglomerate. The stake increase is the latest move in a six-week battle pitting ThaiBev against Heineken. The Dutch brewer, the world’s thirdlargest, was jolted into action when Mr Charoen became the largest shareholder in F&N, with which Heineken has a joint venture controlling Tiger beer maker APB. “If Thai Beverage crosses the 30 percent mark and makes a general

offer then they can block Heineken’s bid for APB. But whether or not they have the intention or the money to buy F&N, that’s anybody’s guess,” said Ng Kian Teck, lead analyst at SIAS Research. A full takeover would stretch ThaiBev’s finances. Moody’s Investors Service said earlier this month ThaiBev’s Baa2 rating remained under review for downgrade after it acquired a 22 percent stake in F&N from Singapore’s OCBC group. Heineken is seeking to convince F&N shareholders to accept its S$7.94 billion (US$6.3 billion) offer to buy the Singapore beveragesto-property group out of the joint venture and to take F&N’s 7.3 percent direct stake and APB shares held by others. Those shareholders also include Japan’s Kirin Holdings, which owns just under 15 percent of F&N. The F&N board has proposed a S$4 billion payout to shareholders

through a capital reduction, if they approve the sale of APB to Heineken. Analysts say that the payout could sway minority shareholders in favour of the deal. A shareholder meeting is expected in October to vote on the APB sale, a source familiar with the plans told Reuters, adding a firm date has not been set yet. One analyst said ThaiBev may

be looking at F&N even without its brewery business. “They see F&N as strategic to their growth ambitions, not just purely on the brewery side but also the soft drinks, which have a strong ASEAN presence, dairies and property,” said Goh Han Peng, an analyst at DMG & Partners Securities in Singapore. “So brewery is valuable. But even if they lose this, they are going to get a good price for it and the remaining businesses inside F&N also have franchise value that appeals to ThaiBev.”

Thai Beverage Pcl increased its holding in Fraser & Neave to 29 percent

Reuters


August 30, 2012 business daily | 11

asia AirAsia profit jumps in Q2 AirAsia Bhd. Said second-quarter profit soared after booking an accounting gain from the spinoff of its Thai venture. Net income in the three months ended June 30 increased to 1.19 billion ringgit (US$382 million) from 104.3 million ringgit a year earlier, the Malaysia-based carrier said in a filing on Tuesday. Net operating profit fell 3 percent to 130.9 million ringgit. The airline booked a fair value gain of 1.04 billion ringgit during the quarter for its remaining 45 percent stake in Thai AirAsia after the Thai airline’s parent went public in May.

Philippine growth seen slowing As remittances boost falters to a 15-month low

P

The Japanese chipmaker may close or sell as many as nine of its 18 domestic factories

about 50 billion yen in lines of credit to the chipmaker, two people with knowledge of the matter said in May. Renesas plans to increase its focus on making microcontrollers, used in cars and TVs. The business has an operating profit margin of at least 10 percent, Renesas said in June. The company had a 27 percent share of the global microcontroller

market last year, making it the world’s largest manufacturer of the products. It plans to raise the share to 35 percent in five years by targeting emerging markets, and an alliance with Taiwan Semiconductor Manufacturing Co. will help cut costs and widen profit margins, Renesas said in June. Bloomberg

hilippine growth probably eased from the fastest pace since 2010 as the faltering global recovery damps demand for Filipino workers and exports. Gross domestic product probably increased 5.5 percent in the three months through June from a year earlier, slowing from a 6.4 percent pace in the first quarter, according to the median estimate of 17 economists in a Bloomberg News survey. That would contrast with Thailand, Malaysia and Indonesia, which reported faster expansion in the second quarter. The data is due today. Money sent home is equivalent to about 10 percent of the US$225 billion economy and helped the Philippines achieve the fastest growth in Southeast Asia in the first quarter. That support is sputtering as the protracted European crisis brought remittance growth to a 15-month low, crimping sales at companies including Megaworld Corp. and putting pressure on President Benigno Aquino to boost manufacturing and investments.

“The Philippines doesn’t have a rich domestic market and it has been very dependent on external income,” said Kevin Lai, a Hong Kong-based economist at Daiwa Capital Markets Ltd. “This reliance on remittances is hurting the economy. Worker remittances will soften because Europe is suffering and to a certain extent, Asia is slowing.” Remittances increased 4.2 percent to $1.81 billion in June, and the central bank forecasts an increase of 5 percent this year compared to 7.2 percent in 2011. A study by the monetary authority last month showed the funds dilute the effectiveness of the policy rate even as they bolster consumption and growth. “Remittance growth is unlikely to return to the double- digit growth rates seen from 2002-2008,” according to a report by analysts at DBS Group Holdings Ltd. last week. “Working domestically may become more attractive to locals as employment opportunities grow. We suspect that remittances will slowly diminish in importance in the coming years.” Bloomberg

South Korean imports slump Adds to signs of weakness in Asian economies Cynthia Kim

The surplus number

S

outh Korea’s decline in imports drove the nation’s current-account surplus to a record in July, adding to signs of weakness in Asian economies. The excess was US$6.1 billion, compared with a revised surplus of US$5.9 billion in June, the Bank of Korea said in Seoul yesterday. The current account is the broadest measure of trade, tracking goods, services and investment income. “This is a recession-type surplus,” said Sun Yoo, a Seoul-based economist at Woori Investment & Securities. “The surplus number is mostly driven by reduced imports, which is a clear sign of slowing domestic growth.” Policy makers across Asia may need to consider more stimulus measures as Europe’s debt crisis hits exports and confidence, driving Japan on Tuesday to cut its assessment of the world and Japanese economies. South Korea’s central bank may cut interest rates again

next month, after a surprise reduction in July, a Bloomberg News survey of economists indicates. Asia’s fourth-biggest economy grew 2.4 percent in the second quarter from a year earlier, the slowest pace in almost three years, according to a preliminary estimate. Imports fell 5.4 percent in July from a year earlier, as exports also tumbled.

is mostly driven by reduced imports, which is a clear sign of slowing domestic growth Sun Yoo, Woori Investment & Securities

Posco’s profits Posco, Asia’s third-biggest steelmaker by output, is among South Korean companies facing weakness in demand. The business environment in the second half “will be worse than expected early this year because of weak demand from construction and shipbuilders,” chief financial officer Park Ki Hong told investors in Seoul last month. “Still, our profitability in the second half will be better than the first half, driven by falling raw material prices.” South Korea’s three-year bonds

are yielding less than the central bank’s benchmark interest rate for the longest period on record as investors bet policy makers will lower borrowing costs further to support the economy. The 3.25 percent debt due June 2015 yields 2.81 percent and the Bank of Korea’s seven-day repurchase rate is 3 percent. The yield has been below the benchmark rate since July 6, the longest period for a three-year note in data compiled by Bloomberg going back to August

2000. Data in the coming week is forecast to show exports fell for a second month in August and inflation held at a 12-year low, according to Bloomberg surveys. The current-account surplus may exceed US$20 billion this year, an amount projected by the central bank in July, Bank of Korea statistics director Yang Jae Ryong told reporters in Seoul yesterday. The surplus may narrow in August due to the summer vacation, he said. Bloomberg


12 |

business daily August 30, 2012

MARKETS Hang SENG INDEX PRICE

Day %

VOLUME

PRICE

Day %

VOLUME

AIA GROUP LTD

26.9

0.1862197

14392056

CHINA UNICOM HON

12.96

-0.4608295

21467755

ALUMINUM CORP-H

3.07

-1.916933

11586905

CITIC PACIFIC

10.66

-0.744879

4578070

SANDS CHINA LTD

BANK OF CHINA-H

2.89

-0.6872852

146158059

CLP HLDGS LTD

64.9

-0.1538462

2881100

BANK OF COMMUN-H

5.17

-1.335878

22741606

CNOOC LTD

14.8

-0.2695418

37833465

BANK EAST ASIA

28.4

-0.1757469

498502

BELLE INTERNATIO

14.7

-0.1358696

10522917

NAME

NAME

NAME

PRICE

POWER ASSETS HOL

Day %

61.1 -0.08176615

VOLUME 1766263

28.05

1.263538

9155657

SINO LAND CO

13.34

-0.1497006

4116715

SUN HUNG KAI PRO

102.8

1.181102

2489028

COSCO PAC LTD

10.16

-2.307692

6397256

SWIRE PACIFIC-A

92.55

0.1081666

639343

ESPRIT HLDGS

12.26

-1.129032

4193992

TENCENT HOLDINGS

242.6

0

2045870

26.85

0.1865672

3276675

TINGYI HLDG CO

22.85

0.660793

4439368

111

0.4524887

1188616

WANT WANT CHINA

9.68

-4.536489

29029773

WHARF HLDG

48.4

-1.123596

4843260

BOC HONG KONG HO

24.75

0.4056795

9724808

HANG LUNG PROPER

CATHAY PAC AIR

12.62

-1.40625

3224522

HANG SENG BK

CHEUNG KONG

HENDERSON LAND D

48.35

0.1035197

3497858

HENGAN INTL

76.45

3.032345

3704507

HONG KG CHINA GS

18.42

-0.1084599

4515233

HONG KONG EXCHNG

104.6

-0.1908397

1509004

68.2

-0.2923977

5001797

68.45

0.3665689

3088275

4.27

-1.385681

236207063

106.7

-0.6517691

2039916

CHINA COAL ENE-H

6.5

-2.548726

33369894

CHINA CONST BA-H

5.26

0.3816794

169491060

CHINA LIFE INS-H

20.7

1.970443

47392576

CHINA MERCHANT

23.9

1.918977

2862981

CHINA MOBILE

83.85

-0.2379536

11335159

HUTCHISON WHAMPO

CHINA OVERSEAS

17.92

0.1117318

18249117

IND & COMM BK-H

CHINA PETROLEU-H

7.46

0.8108108

57912036

LI & FUNG LTD

12.86

0.3120125

28778791

HIGH

19939.54

CHINA RES ENTERP

23.35

2.863436

1918346

MTR CORP

27.95

0

1204562

LOW

19723.3

CHINA RES LAND

15.02

-0.7926024

7865961

NEW WORLD DEV

9.82

-1.306533

7255652

CHINA RES POWER

16.7

0

2573296

52W (H) 21760.33984

PETROCHINA CO-H

9.45

0.1059322

43966581

CHINA SHENHUA-H

28.8

-1.030928

7577005

PING AN INSURA-H

56.7

-0.8741259

14515818

HSBC HLDGS PLC

MOVERS

19

27

3 19940

INDEX 19788.51

(L) 16170.35

19720

27-Aug

29-Aug

Hang SENG CHINA ENTErPRISE INDEX NAME

PRICE

DAY %

VOLUME

AGRICULTURAL-H

3.17

1.92926

79098709

AIR CHINA LTD-H

4.75

-1.452282

5118000

ALUMINUM CORP-H

NAME

PRICE

DAY %

VOLUME

22.45

1.354402

4604800

CHINA PETROLEU-H

7.09

-0.1408451

31039338

ZIJIN MINING-H

CHINA PACIFIC-H

NAME YANZHOU COAL-H

PRICE

DAY %

12.76

0.9493671

VOLUME 9464868

2.41

0

17049136

3.21

0.9433962

6975968

CHINA RAIL CN-H

6.24

-1.265823

19223000

ZOOMLION HEAVY-H

11.54

6.654344

29164120

ANHUI CONCH-H

23.75

3.938731

20401882

CHINA RAIL GR-H

3.07

0.3267974

20591000

ZTE CORP-H

15.04

0.669344

6730935

BANK OF CHINA-H

2.93

2.447552

389843053

CHINA SHENHUA-H

27.85

1.272727

9273746

5.05

1

12754025

CHINA TELECOM-H

3.63

0.5540166

29684000

15.24

-5.925926

12577500

DONGFENG MOTOR-H

13.48

8.012821

20906528

CHINA CITIC BK-H

3.98

0.2518892

47624006

GUANGZHOU AUTO-H

6.68

2.769231

6689701

CHINA COAL ENE-H

7.23

1.402525

18024088

HUANENG POWER-H

4.89

1.242236

9826000

CHINA COM CONS-H

7.32

1.244813

21550789

IND & COMM BK-H

4.67

1.082251

260319980

CHINA CONST BA-H

5.21

1.165049

227493277

JIANGXI COPPER-H

16.26

0.8684864

7358345

BANK OF COMMUN-H BYD CO LTD-H

3.5

-1.408451

9866000

PETROCHINA CO-H

10.2

0.1964637

31650019

CHINA LIFE INS-H

18.2

0.7751938

17874467

PICC PROPERTY &

8.18

2.122347

14181021

CHINA LONGYUAN-H

4.49

-2.391304

5595164

PING AN INSURA-H

56.7

0.4428698

6430028

CHINA MERCH BK-H

14.64

1.385042

10070351

SHANDONG WEIG-H

7.94

-0.2512563

1144000

CHINA COSCO HO-H

MOVERS

8

0 9720

INDEX 9470.46 HIGH

9728.09

LOW

9468.59

CHINA MINSHENG-H

7.01

0.1428571

25184000

SINOPHARM-H

17.66

-1.450893

971312

52W (H) 11916.1

CHINA NATL BDG-H

9.47

3.04679

46809000

TSINGTAO BREW-H

46.65

-1.269841

207417

(L) 8058.58

10.88

1.872659

10960000

WEICHAI POWER-H

32.5

2.362205

1967864

CHINA OILFIELD-H

32

9460

27-Aug

29-Aug

Shanghai Shenzhen CSI 300 NAME

PRICE

DAY %

VOLUME

AGRICULTURAL-A

2.5

0.4016064

20337365

AIR CHINA LTD-A

4.8

-1.840491

5.46 13.29

ALUMINUM CORP-A ANHUI CONCH-A

NAME

PRICE

DAY %

VOLUME

PRICE

DAY %

VOLUME

CSR CORP LTD -A

4.02

-0.248139

13451266

NAME QINGHAI SALT-A

30.66

-1.667736

2370083

6110978

DAQIN RAILWAY -A

5.97

1.186441

40513380

SAIC MOTOR-A

11.71

1.473137

7948789

-1.798561

5079406

DATANG INTL PO-A

4.42

-1.118568

1508340

SANY HEAVY INDUS

10.42

-3.963134

27547604

-1.555556

8415250

DONGFANG ELECT-A

14.3

-1.987663

4975630

SHANDONG GOLD-MI

34.77

-1.221591

10097330

10.51

-0.8490566

3310451

SHANG PHARM -A

11.87

0.08431703

10342143 38419444

BANK OF BEIJIN-A

7.31

-0.6793478

9749624

EVERBRIG SEC -A

BANK OF CHINA-A

2.77

0

6156730

GD MIDEA HOLDING

9.18

0

9139999

SHANG PUDONG-A

7.55

-0.6578947

BANK OF COMMUN-A

4.35

-1.136364

29619494

GD POWER DEVEL-A

2.54

-1.930502

31065400

SHANGHAI ELECT-A

4.06

-0.9756098

2262096

BANK OF NINGBO-A

9.48

-0.524659

5431969

GF SECURITIES-A

10.24

-2.8463

40369844

SHANXI LU'AN -A

16.93

-4.88764

18644938

BAOSHAN IRON & S

4.36

-2.678571

126397191

GREE ELECTRIC

20.35

-1.11759

6134194

SHANXI XINGHUA-A

37.75

0.1857749

1039602

12.66

-2.690238

12348488

SHANXI XISHAN-A

12.73

-3.193916

9308423

15.69

3.701256

15439237

GUANGHUI ENERG-A

CHINA CITIC BK-A

3.83

-0.7772021

4250972

HAITONG SECURI-A

8.07

-1.344743

26597080

SHENZEN OVERSE-A

5.41

0

6922566

CHINA CNR CORP-A

3.45

-0.2890173

11803485

HANGZHOU HIKVI-A

27.45

-0.1818182

1733938

SUNING APPLIAN-A

6.01

1.349073

57567135

CHINA COAL ENE-A

6.82

-3.125

9274906

HEBEI IRON-A

2.53

-1.55642

12593580

TSINGTAO BREW-A

32.75

0.3370098

610240

9581332

HENAN SHUAN-A

60

-4.761905

1518448

WEICHAI POWER-A

16.84

-2.376812

6034812

BYD CO LTD -A

CHINA CONST BA-A

4.01

-0.2487562

CHINA COSCO HO-A

4.03

-0.4938272

5561447

HONG YUAN SEC-A

15.27

-2.552648

7575293

WULIANGYE YIBIN

33.06

-2.506635

15713576

CHINA CSSC HOL-A

19

-1.960784

2785271

HUATAI SECURIT-A

8.29

-1.893491

7995811

YANGQUAN COAL -A

14.18

-2.139406

6700738

CHINA EAST AIR-A

3.45

-3.631285

11160621

HUAXIA BANK CO

8.77

-0.6795017

12361712

YANTAI CHANGYU-A

50.85

-3.253425

1684053

CHINA EVERBRIG-A

2.77

0

29022200

IND & COMM BK-A

3.84

-0.2597403

15010929

YANTAI WANHUA-A

12.5

-1.107595

3050315

CHINA LIFE INS-A

16.77

0.2990431

12334224

INDUSTRIAL BAN-A

12.26

-0.1628664

18402056

YANZHOU COAL-A

17.5

-2.939545

1865063

CHINA MERCH BK-A

10.02

0.0999001

25836174

INNER MONG BAO-A

32.91

-6.638298

58506458

YUNNAN BAIYAO-A

59.5

-1.3267

1533601

CHINA MERCHANT-A

9.58

-1.541624

6627853

INNER MONG YIL-A

20.4

0.6910168

6490625

ZHONGJIN GOLD

14.74

-2.319417

13202900

CHINA MERCHANT-A

18.94

-0.8895866

5416417

INNER MONGOLIA-A

5.24

-2.056075

81521689

ZIJIN MINING-A

3.74

-1.058201

21295607

30.33

1.1

2965392

ZOOMLION HEAVY-A

8.03

-1.108374

20440093

ZTE CORP-A

9.64

-1.431493

10437925

CHINA MINSHENG-A

5.98

0.3355705

51170233

JIANGSU HENGRU-A

CHINA NATIONAL-A

5.94

-0.6688963

12536438

JIANGSU YANGHE-A

122.7

-2.308917

1213672

CHINA OILFIELD-A

16.04

-1.835985

3328590

JIANGXI COPPER-A

20.01

-2.151589

5572717

CHINA PACIFIC-A

JINDUICHENG -A

11.43

-3.787879

4375631

JIZHONG ENERGY-A

12.38

-2.825746

10236026

19.02

-0.2098636

7802180

CHINA PETROLEU-A

6.04

-3.049759

29965555

CHINA RAILWAY-A

4.22

-1.17096

7550793

KANGMEI PHARMA-A

15.71

1.159047

7936025

CHINA RAILWAY-A

2.42

-1.22449

10150748

KWEICHOW MOUTA-A

219.16

-2.824458

3042567

CHINA SHENHUA-A

21.43

-0.4182156

7579221

LUZHOU LAOJIAO-A

36.53

-2.456609

6623172

75077624

METALLURGICAL-A

2.06

-1.435407

25211701

MOVERS

60

7 2270

INDEX 2214.814

CHINA SHIPBUIL-A

4.77

-3.441296

CHINA SOUTHERN-A

3.58

-2.98103

16940927

NINGBO PORT CO-A

2.48

-0.4016064

4534053

CHINA STATE -A

3.03

-0.6557377

28899734

PANGANG GROUP -A

3.88

-2.020202

25251584

HIGH

2268.49

CHINA UNITED-A

3.86

0

63371020

PETROCHINA CO-A

8.81

-1.564246

13626163

LOW

2214.81

CHINA VANKE CO-A

7.97

-0.375

20237241

PING AN BANK-A

14.28

-0.6263048

6948365

CHINA YANGTZE-A

6.54

0.1531394

6738707

PING AN INSURA-A

38.43

-1.157407

10750322

CHONGQING WATE-A

5.57

-1.415929

2989721

POLY REAL ESTA-A

9.1

-1.515152

26803881

10.17

-0.6835938

35035630

QINGDAO HAIER-A

10.01

2.456499

6977446

CITIC SECURITI-A

233

52W (H) 2901.733 (L) 2214.429

2210

27-Aug

28-Aug

FTSE TAIWAN 50 INDEX NAME

PRICE DAY %

Volume

ACER INC

26.3

0.7662835

7768512

ADVANCED SEMICON

22.3

0

19448983

ASIA CEMENT CORP

34.5 -0.2890173

NAME FORMOSA PLASTIC FOXCONN TECHNOLO

PRICE DAY %

Volume

NAME

PRICE DAY %

81

0.1236094

4058380

TAIWAN MOBILE CO

111.5

0

6650027

TPK HOLDING CO L

29.8

0

9711347

84 -0.2375297

34184917

1781890

FUBON FINANCIAL

ASUSTEK COMPUTER

275.5

1.286765

3183895

HON HAI PRECISIO

AU OPTRONICS COR

9.23

1.540154

39017157

HOTAI MOTOR CO

216.5

4.589372

894963

0.4694836

2476505

370.5

0.9536785

10604178

TSMC

82.7

0.3640777

18467775

UNI-PRESIDENT

48.1 -0.3108808 12.05

0

WISTRON CORP

33.15

-1.339286

9679112

13.9

0

8480667

55

2.040816

4132277

151.5 -0.6557377

9950569

HTC CORP

253.5

2.012072

12087468

CATHAY FINANCIAL

28.95 -0.3442341

14944989

HUA NAN FINANCIA

16.25

0.308642

2862805

YUANTA FINANCIAL

623

0.6462036

884487

YULON MOTOR CO

34.95 -0.2853067

3353594

CHANG HWA BANK

15.5

0.9771987

7139880

LARGAN PRECISION

72.7

1.678322

9367885

LITE-ON TECHNOLO

CHIMEI INNOLUX C

9.45

0.4250797

12347982

MEDIATEK INC

CHINA DEVELOPMEN

7.08

0

16538813

MEGA FINANCIAL H

26

0

14128003

NAN YA PLASTICS

17.7

0

7394398

PRESIDENT CHAIN

90.2

0.2222222

3843624

QUANTA COMPUTER

75.3

1.209677

6064123

26.45

-1.121495

7247245

SILICONWARE PREC

33.7

-0.736377

7712522

CHINA STEEL CORP CHINATRUST FINAN CHUNGHWA TELECOM COMPAL ELECTRON

320

1.587302

14732832

22.65

0.8908686

20053612

56.9 -0.5244755

3468949

163.5

1.552795

567257

DELTA ELECT INC

104.5

2.955665

6320328

SINOPAC FINANCIA

11.7

0

18357451

FAR EASTERN NEW

31.55

0.477707

2338262

SYNNEX TECH INTL

66.8

0.7541478

1408052

FAR EASTONE TELE

73.6

-0.405954

3973688

TAIWAN CEMENT

33.05

-1.195815

8847661

FIRST FINANCIAL

17.5

0.286533

10955878

16.5

0

5162186

FORMOSA CHEM & F

77.8 -0.2564103

2952073

TAIWAN FERTILIZE

74

0.2710027

2397849

FORMOSA PETROCHE

87.4

1158681

TAIWAN GLASS IND

29.15

1.039861

2787176

-1.019253

TAIWAN COOPERATI

11332478

UNITED MICROELEC

CATCHER TECH

CHENG SHIN RUBBE

Volume

107

MOVERS

26

14

22625109

10 5160

INDEX 5068.17 HIGH

5150.31

LOW

5050.94

52W (H) 5621.53 5050

(L) 4643.05 24-Aug

28-Aug


August 30, 2012 business daily | 13

MARKETS GAMING STOCKS - DAILY PERFORMANCE (Hong Kong Stock Exchange) gaLaXy eNTerTaINMeNT

MeLCo CroWN eNTerTaINMeNT

MgM CHINa HoLDINgS 30.7

23.1

12.91 12.89

22.9 30.65

12.87

22.7

Max 23.1

average 22.687

Min 22.5

Last 22.65

22.5

SaNDS CHINa LTD

12.85 Max 30.65

average 30.65

Min 30.65

Last 30.65

30.6

SJM HoLDINgS LTD

Max 12.9

average 12.876

Min 12.84

Last 12.86

12.83

WyNN MaCaU LTD 16.10

28.1

18.8

16.05

27.9

18.6

16.00 27.7

average 27.906

Max 28.1

Min 27.5

Last 28.05

27.5

15.90 Max 16.04

average 16.000

Commodities PRICE

DAY %

YTD %

(H) 52W

(L) 52W

WTI CRUDE FUTURE Oct12

95.57

-0.788944336

-3.053357679

110.6499939

78.15999603

BRENT CRUDE FUTR Oct12

111.8

-0.692840647

6.91402888

123.2900009

89.11000061

GASOLINE RBOB FUT Sep12

308.51

-1.311538339

16.14275496

320.4999924

237.3699903

GAS OIL FUT (ICE) Oct12

975.5

-0.306591722

8.630289532

1044.75

799

NATURAL GAS FUTR Sep12

2.597

-0.6503443

-20.89552239

4.630000114

2.221999884

310.07

-0.62814473

8.83849907

332.9600096

251.5599966

1665.52

0.2564

6.4291

1921.18

1522.75

HEATING OIL FUTR Sep12 METALS

Gold Spot $/Oz Silver Spot $/Oz

30.84

0.3537

10.7958

43.4088

26.085

Platinum Spot $/Oz

1518.35

-0.3903

8.8813

1896.75

1339.25

Palladium Spot $/Oz

634.23

-1.7307

-2.9487

792.93

537.54 1827.25

LME ALUMINUM 3MO ($) LME COPPER 3MO ($) LME ZINC

Min 15.94

Last 15.94

3MO ($)

LME NICKEL 3MO ($)

1916

-0.104275287

-5.148514851

2476

7607.5

-0.42539267

0.098684211

9304

6635

1872

-0.372538584

1.463414634

2311

1718.5

MAJORS

ASIA PACIFIC

CROSSES

16250

-1.365705615

-13.14804917

22450

15236

-0.127591707

2.959552779

17.5

14.15499973

800.25

0.597108737

36.50319829

849

499

WHEAT FUTURE(CBT) Dec12

884.25

0.999428898

22.8125

953.25

629.5

SOYBEAN FUTURE Nov12

1732.5

0.595151691

43.86547644

1760.5

1115.75

COFFEE 'C' FUTURE Dec12

167.5

-0.267936886

-29.02542373

285.6499939

153.6999969

CROWN LTD

SUGAR #11 (WORLD) Oct12

20.15

0.099354198

-11.73893999

25.5

19.23999977

AMAX HOLDINGS LT

COTTON NO.2 FUTR Dec12

76.16

0.7140968

-13.29690346

102.25

64.61000061

BOC HONG KONG HO CENTURY LEGEND

Dec12

Last 18.24

Min 18.24

NAME ARISTOCRAT LEISU

CHINA OVERSEAS

World Stock MarketS - Indices COUNTRY

PRICE

DAY %

YTD %

(H) 52W

(L) 52W

DAY %

1.0362 1.5818 0.9558 1.2565 78.53 7.989 7.7563 6.3518 55.665 31.34 1.2534 29.936 42.325 9581 81.374 1.201 0.79434 7.9766 10.0375 98.67 1.03

-0.0964 0.2027 0.2092 0.1834 0.1528 -0.0063 -0.0026 0.0205 0.018 -0.1276 -0.0399 0.0935 -0.1748 -0.334 0.2507 0.0117 0.0151 -0.3335 -0.1823 -0.0203 0

YTD %

(H) 52W

1.4987 1.7693 -1.8519 -3.0553 -2.0629 0.1327 0.1431 -0.8942 -4.6708 0.6701 3.4466 1.1458 3.5794 -5.3439 -3.6154 1.3147 4.916 1.9758 3.1333 1.0033 0.0097

(L) 52W

1.0857 1.6335 0.9972 1.4469 84.18 8.0413 7.8077 6.406 57.3275 32 1.3199 30.716 44.35 9662 88.637 1.24736 0.88845 9.2273 11.6153 111.6 1.0311

0.9388 1.5235 0.7712 1.2043 75.35 7.9823 7.7526 6.2769 45.785 29.87 1.2021 28.911 41.57 8507 72.057 1.1002 0.77553 7.7018 9.6245 94.12 1.0288

MACAU RELATED STOCKS

CHEUK NANG HLDGS

NAME

average 18.580

PRICE AUD GBP CHF EUR JPY MOP HKD CNY INR THB SGD TWD PHP IDR AUDJPY EURCHF EURGBP EURCNY EURMOP EURJPY HKDMOP

15.655

AGRICULTURE ROUGH RICE (CBOT) Nov12 CORN FUTURE

18.2 Max 18.74

CURRENCY EXCHANGE RATES

NAME ENERGY

18.4

15.95

PRICE

(H) 52W

(L) 52W

2.7

DAY % YTD % -2.173913

22.72727

3.25

1.88

VOLUME CRNCY 2182754

9

-0.8810573

11.24845

9.29

7.47

1229968

0.061

0

-29.88506

0.119

0.055

0

24.75

0.4056795

34.51087

24.95

14.24

9724808

0.225

-0.8810573

-2.173915

0.335

0.204

40000

3.1

0

10.71429

3.62

2.3

128

17.92

0.1117318

38.05856

19.16

9.99

18249117

CHINESE ESTATES

9.3

-1.06383

-25.6

13.68

8.3

36000

CHOW TAI FOOK JE

9.58

-0.2083333

-31.17816

15.16

8.4

2604570

EMPEROR ENTERTAI

1.42

1.428571

27.92793

1.48

0.97

355000

FUTURE BRIGHT

1.15

-0.862069

173.8095

1.24

0.3

1128000

22.65

3.424658

59.05899

24.95

8.69

305403462

111

0.4524887

20.45578

116.7

84.4

1188616

DOW JONES INDUS. AVG

US

13102.99

-0.1651851

7.247198

13338.66016

10404.49

NASDAQ COMPOSITE INDEX

US

3077.143

0.1285634

18.1177

3134.17

2298.89

FTSE 100 INDEX

GB

5744.86

-0.5341335

3.097118

5989.07

4868.6

HOPEWELL HLDGS

25.35

0.7952286

27.6435

25.4

18.56

1629103

DAX INDEX

GE

6957.74

-0.6417543

17.96079

7194.33

4965.8

HSBC HLDGS PLC

68.2

-0.2923977

15.59322

71.8

56

5001797

NIKKEI 225

JN

9069.81

0.4042824

7.267115

10255.15

8135.79

HUTCHISON TELE H

3.76

-0.265252

25.75251

3.88

2.53

6373000

LUK FOOK HLDGS I

21.25

-1.847575

-21.58672

42.7

14.7

1830000

MELCO INTL DEVEL

6.23

0.8090615

7.972271

9.17

4.3

1599000

12.86

-0.1552795

34.06791

14.804

7.6

1706387

GALAXY ENTERTAIN HANG SENG BK

HANG SENG INDEX

HK

19788.51

-0.1175562

7.345614

21760.33984

16170.35

CSI 300 INDEX

CH

2214.814

-1.054185

-5.581517

2901.733

2214.429

TAIWAN TAIEX INDEX

TA

7391.15

0.3967704

4.511683

8170.72

6609.11

MIDLAND HOLDINGS

KOSPI INDEX

SK

1928.54

0.6371554

5.630596

2057.28

1644.11

NEPTUNE GROUP

S&P/ASX 200 INDEX

AU

4356.445

-0.06728024

7.392575

4448.5

3840.2

ID

4093.17

-1.199127

7.0952

4234.734

3217.951

FTSE Bursa Malaysia KLCI

MA

1645.58

-0.09288997

7.502954

1655.39

1310.53

NZX ALL INDEX

NZ

804.569

10.24509

818.513

712.548

PHILIPPINES ALL SHARE IX

PH

3454.11

13.43398

3531.5

2695.06

JAKARTA COMPOSITE INDEX

0.3235579

HSBC Dragon 300 Index Singapor

SI

582.55

-0.21

17.37

NA

NA

STOCK EXCH OF THAI INDEX

TH

1225.77

-0.5992734

19.55

1247.72

843.69

HO CHI MINH STOCK INDEX

VN

393.06

1.887086

11.80771

492.44

Laos Composite Index

LO

1038.81

0.09828578

15.49263

1064.23

MGM CHINA HOLDIN

4.25

1.190476

7.484813

5.217

2.887

852000

0.167

1.212121

50.45045

0.205

0.08

16920000

NEW WORLD DEV

9.82

-1.306533

56.869

10.96

6.13

7255652

SANDS CHINA LTD

28.05

1.263538

27.79043

33.05

14.9

9155657

SHUN HO RESOURCE

1.13

-1.73913

13

1.28

0.82

2000

SHUN TAK HOLDING

2.85

1.06383

11.36605

3.892

2.241

5318750

SJM HOLDINGS LTD

15.94

0.1256281

27.46355

18.285

10.079

4822393

SMARTONE TELECOM

17.04

3.398058

26.78572

18.5

9.8

573397

18.3

-2.555911

-6.153846

25.5

14.62

5759663

WYNN MACAU LTD ASIA ENTERTAINME

3.85

-3.990025

-34.52381

8

2.4

105380

BALLY TECHNOLOGI

44.26

-0.6063328

11.88068

49.32

24.74

570189

332.28

BOC HONG KONG HO

3.25

0

35.57555

3.25

1.81

1500

876.33

GALAXY ENTERTAIN

2.78

0

48.6631

3.24

1.08

5600

12.16

-0.1642036

-29.30233

18.1701

10.92

2686844

JONES LANG LASAL

71.1

-0.2525253

16.06269

87.52

46.01

207897

LAS VEGAS SANDS

42.7

1.618277

62.09

34.72

7220668

MELCO CROWN-ADR

12

1.954121

24.74013

16.02

7.05

3430251

MGM CHINA HOLDIN

1.64

0

37.61931

1.96

1.0025

10400

MGM RESORTS INTE

10.04

-0.5940594

-3.739217

14.9401

7.4

8071068

SHUFFLE MASTER

14.77

3.431373

26.02389

18.77

7.55

364220

2.04

0

26.89939

2.3177

1.2624

1100

105.23

-0.2275529

-4.76061

154.7051

90.108

1128941

INTL GAME TECH

Shanghai Shenzhen Composite index is listing the biggest companies by market capitalisation. All data supplied by Bloomberg unless otherwise indicated.

SJM HOLDINGS LTD WYNN RESORTS LTD

AUD HKD

USD


14 |

business daily August 30, 2012

Opinion

The media Cold War Anne-Marie Slaughter

Professor of Politics and International Affairs at Princeton University and former director of policy planning in the U.S. State Department

all foreign journalists. Several weeks ago, the government of Tajikistan blocked YouTube and reportedly shut down communications networks in a remote region where government forces were battling an opposition group. The Chinese government barred all foreign journalists from Tibet when it cracked down hard on protesters before the 2008 Olympics. These more traditional tactics can now be supplemented with new tools for misinformation. For close followers of the Syrian conflict, tracking key reporters and opposition representatives on Twitter can be a surreal experience.

Cyber-wars

A

n information war has erupted around the world. The battle lines are drawn between those governments that regard the free flow of information, and the ability to access it, as a matter of fundamental human rights, and those that regard official control of information as a fundamental sovereign prerogative. The contest is being waged institutionally in organisations like the International Telecommunications Union (ITU) and daily in countries like Syria. The sociologist Philip N. Howard recently used the term “new cold war” to describe “battles between broadcast media outlets and social-media upstarts, which have very different approaches to news production, ownership, and censorship.” Because broadcasting requires significant funding, it is more centralised – and thus much more susceptible to state control. Social media, by contrast, transforms anyone with a mobile phone into a potential roving monitor of government deeds or misdeeds, and are hard to shut down without shutting down the entire Internet. Surveying struggles between broadcast and social media in Russia, Syria, and Saudi Arabia, Howard concludes that, notwithstanding their different media cultures, all three governments strongly back statecontrolled broadcasting. These intra-media struggles are interesting and important. The way that information circulates does reflect, as Howard argues, a conception of how a society/polity should be organised.

Information control

owns information in the first place. In January 2010, U.S. Secretary of State Hillary Clinton proclaimed that the United States “stand[s] for a single Internet where all of humanity has equal access to information and ideas.” She linked that stance not only to the U.S. Constitution’s First Amendment, which protects freedom of expression and freedom of the press, but also to

Citizens’ access to information is an essential tool to hold governments accountable. Government efforts to manipulate or block information should be presumed to be an abuse of power – one intended to mask many other

But an even deeper difference concerns the fundamental issue of who

abuses

the Universal Declaration of Human Rights, which holds that all people have the right “to seek, receive, and impart information and ideas through any media and regardless of frontiers.” Many governments’ determination to “erect electronic barriers” to block their citizens’ efforts to access the full resources of the Internet, she said, means that “a new information curtain is descending across our world.” This larger struggle is playing out in many places, including the ITU, which will convene 190 countries in Dubai in December to update an international telecommunications treaty first adopted in 1988. Although many of the treaty’s details are highly technical, involving the routing of telecommunications, various governments have submitted proposals to amend the treaty that include provisions aimed at facilitating government censorship of the Internet. Russian President Vladimir Putin has been open about his desire to use the ITU “to establish international control” over the Internet, thereby superseding current arrangements, which leave Internet governance in the hands of private groups like the Internet Corporation for Assigned Names and Numbers and the Internet Engineering Task Force. The U.S. would never sign a treaty that fundamentally changed Internet governance arrangements, but the point is that many governments will try to use the treaty process to increase their ability to control the information that their citizens can access. On the ground, governments are often still primarily focused on blocking information about what they are doing. One of the Syrian government’s first moves after it began shooting protesters, for example, was to expel

Two weeks ago, Ausama Monajed, a Syrian strategic communications consultant who sends out a steady stream of information and links to opposition activities in Syria, suddenly started sending out pro-government propaganda. The Saudi-owned satellite news channel Al Arabiya has also reported the hacking of its Twitter feed by the “Electronic Syrian Army,” a shadowy group most likely comprised of free-lance operatives with the direct or indirect support of the Syrian government. It is one thing to read about sophisticated cyber-war capabilities; it is quite another to see the online identities of familiar people or Web sites suddenly hijacked. In the many manifestations of the ongoing and growing information war(s), the pro-freedom-of-information forces need a new weapon. A government’s banning of journalists or blocking of news and social-media Web sites that were previously allowed should itself be regarded as an early warning sign of a crisis meriting international scrutiny. The presumption should be that governments with nothing to hide have nothing to lose by allowing their citizens and internationally recognised media to report on their actions. To give this presumption teeth, it should be included in international trade and investment agreements. Imagine if the International Monetary Fund, the World Bank, and regional development banks suspended financing as soon as a government pulled down an information curtain. Suppose foreign investors wrote contracts providing that the expulsion and banning of foreign journalists or widespread blocking of access to international news sources and social media constituted a sign of political risk sufficient to suspend investor obligations under the contract. Americans say that sunlight is the best disinfectant. Citizens’ access to information is an essential tool to hold governments accountable. Government efforts to manipulate or block information should be presumed to be an abuse of power – one intended to mask many other abuses. © Project Syndicate

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August 30, 2012 business daily | 15

OPINION Business

wires Leading reports from Asia’s best business newspapers

Jakarta Globe The Indonesian government has allocated US$20 billion for infrastructure development next year to boost national economic growth. Regarding the transportation sector, the government said they hope to extend the length of current national roads by 4,278 kilometres. The government plans to build over 500 kilometres of new roads, 380 kilometres of railways, as well as some 15 additional airports. It will also build international ports in Kuala Tanjung, Sumatra for Western Indonesia, and in Bitung, Sulawesi for Eastern Indonesia.

Asahi Shimbun NEC Corp. is planning to cultivate chemical-free strawberries in India in an attempt to create jobs for the poor and spread the NEC brand. The information technology giant is cooperating with GRA, a non-profit organisation that has been growing hydroponic strawberries. In September, a team will start test growing at the College of Agriculture, Pune, in western India. NEC will construct 100-square-meter greenhouses in two villages and plans to employ about 50 homemakers from poor families in each village to help run the operation.

Business Times Singapore’s Sembcorp Marine Ltd, the world’s second-largest oilrig builder, has secured a contract worth US$674 million to carry out work for two floating production storage and offloading vessels. A subsidiary will build a total of eight modules and module integration works for the two vessels from Tupi BV, a consortium owned by Petrobras Netherlands BV. The two vessels will be deployed in the Tupi field offshore Brazil and will have a production capacity of 150,000 barrels of oil per day.

Bangkok Post The National Broadcasting and Telecommunications Commission ordered secondranked mobile operator Total Access Communication Plc (DTAC) to pay tens of millions of baht in fines for its repeated defaults to comply with telecommunications law. The move came in the wake of DTAC’s fifth network collapse since late last year. The latest failure occurred at 11am Tuesday morning before normal service resumed in the afternoon. Some 130 million mobile users of all operators were affected by the service disruption.

Libor’s trillion-dollar question Mark Whitehouse Paula Dwyer Bloomberg View editors

T

he global investigation into the manipulation of Libor has so far done a good job of exposing how bankers corrupted one of the world’s most important financial indicators. Now authorities need to take a giant step further: make banks release the data needed to determine how much damage was done and who should bear the most responsibility. For those still not familiar with the London interbank offered rate, it’s an array of benchmarks designed to provide an objective assessment of banks’ borrowing costs – information that is used to set the payments on hundreds of trillions of dollars in loans, securities and derivatives worldwide. The rates are calculated by asking banks, every workday morning in London, how much they would pay to borrow money in 10 currencies and at 15 time periods, from overnight to a year. Investigators are focusing on two kinds of manipulation. In one, bankers submitted false data to push Libor in a direction that would benefit their own traders. In the other, bankers intentionally lowered the reported rates, which are published daily, to make their institutions’ financial positions look better than they really were. In June, for example, Barclays Plc paid about US$450 million in fines after confessing that, during the 2008 financial crisis, it lowered its quotes below its true borrowing rates to keep them in line with those of other banks, which Barclays thought were fudging even more.

Measuring shortfall How long the lying went on, and how systematic it was, matters a lot. If, for example, underreporting caused Libor to be artificially depressed by 0.1 percentage point for only a few months, payments on more than US$300 trillion in mortgages, corporate bonds and derivatives tied to the benchmark might have fallen short by about US$75 billion or so. If the problem lasted a few years, the shortfall could be close to US$1 trillion. Such manipulation would represent a big gift to payers of Libor, such as financially stretched U.S. homeowners whose interest costs on floating-rate mortgages would have been lower. But for bond investors, municipalities, hedge funds and others on the receiving end of Libor, it would mean major losses. Many are already trying to recoup suspected underpayments through litigation. How much Libor was off, then, could be a trillion-dollar question. So far, researchers have managed only partial estimates. A 2008 Wall Street

Journal analysis suggested that three-month and six-month U.S. dollar Libor – two of the most widely used rates – were understated by an average of about a quarter percentage point in the first four months of 2008. A separate study by economists at the New York Federal Reserve used 2007 to 2009 data on interbank loans made through the Fed’s wiretransfer system. It found a smaller average discrepancy, but estimated that dollar Libor rates could have been understated by more than 0.2 percentage point in the two weeks after the bankruptcy of Lehman Brothers Holdings Inc. in September 2008. It’s worth noting that the pressures on banks to understate their borrowing rates didn’t end with the darkest days of the financial crisis. Concerns about their creditworthiness flared up with the European debt crisis in 2010 and 2011. In June, Moody’s Investors Service downgraded a number of banks that report Libor rates on the grounds that their trading activities could threaten their solvency. Big financial institutions typically borrow US$10 or more for every dollar in equity provided by shareholders, so managing the market’s perceptions of their borrowing costs is crucial to their profitability – and at times to their survival.

Complete picture To give a more complete picture of the misbehaviour, and to establish what share of the compensation burden each Libor-reporting bank should bear, researchers need access to better data on actual borrowing costs. If they could get records of observable transactions, they could produce an independent estimate of how much the

Shedding light on the extent of Libor manipulation is essential to restoring the market’s integrity

banks’ Libor quotes were off on any given day. Such an authoritative benchmark would have many benefits: plaintiffs, for example, could use it to reach settlements with banks, avoiding legal wrangling that could weigh on the financial sector for years. Good data, though, are hard to find. The Fed hasn’t made information from its wire-transfer system public.

The Libor panel banks, for their part, closely guard information on the interest rates they pay on actual short-term loans. This is an odd habit, given that they are supposedly publishing their borrowing rates in great detail every day for the purpose of calculating Libor. If they’re not lying, there should be no news in the transactions. It’s up to the authorities investigating Libor to break the information blockade. In the U.S., for example, the Office of Financial Research, set up by the Dodd-Frank financial reform act, has the subpoena power needed to get the data and the brainpower required to crunch the numbers. Ideally, it would also make the data public, so independent academics and journalists could check its work. Shedding light on the extent of Libor manipulation is essential to restoring the market’s integrity. The point of justice, after all, isn’t only to punish the guilty. It’s also to establish the truth, so we can draw the right conclusions, fix what needs fixing and move on. Bloomberg View


16 |

business daily August 30, 2012

CLOSING Date set over Samsung ‘phone ban’

Lufthansa staff to go on strike

A U.S. judge set a December 6 court date to hear Apple Inc.’s request for a permanent injunction against Samsung Electronics Co.’s smartphones, which could delay the potential impact of Apple’s legal victory. Apple on Monday identified eight devices it will seek preliminary injunctions against, and said it would file for a permanent sales ban. The judge had originally suggested that Apple’s request would be heard next month. A jury on Friday ordered Samsung to pay Apple more than US$1 billion after ruling it had infringed several of the iPhone maker’s patents.

Cabin staff at German airline Lufthansa are to go on strike, possibly as early as today, after wage talks broke down this week. “We’ll strike tomorrow at the earliest,” said the head of the UFO labour union, Nicoley Baubliesy esterday. Lossmaking Lufthansa has said it will cut 3,500 jobs. The union is seeking a pay increase of 5 percent for cabin staff for 15 months starting from January this year, after three years of no increases. Lufthansa’s latest offer was for a pay increase of about 3.5 percent.

Irish growth forecast slashed The European Commission has cut its growth forecasts for Ireland next year by half a percentage point, a draft document seen by Reuters showed yesterday, raising fresh doubts as to whether the economy can grow fast enough to service large debts. Ireland, which returned to long-term bond markets ahead of schedule last month, has avoided joining most of the eurozone in recession but desperately needs growth to accelerate if it to eat into a debt pile set to peak close to 120 percent next year. The commission, part of Dublin’s “troika” of lenders overseeing an 85 billion euro (US$106.81 billion) bailout, said it expected gross domestic product to grow by 1.4 percent in 2013 and not the 1.9 percent predicted in May. It also lowered its forecast for this year slightly, to 0.4 percent from 0.5 percent, as Ireland’s open, export-driven economy braced itself for a tougher year than 2011 when it grew by a higher-thanexpected 1.4 percent. “The outlook for external demand has deteriorated somewhat since the finalisation of the last review, particularly for next year,” the commission said in its latest review of Ireland’s bailout programme, circulated among some Irish lawmakers ahead of its discussion at EU level. Dublin has pencilled in GDP growth of 2.2 percent for next year and could face another 12 months of downward revisions after it was forced to lower its forecast for 2012 three times in as many updates, the last coming in April.

G7 urges higher oil output Group ready to push for release of reserves Barclays to face possible SFO probe

Oil prices have surged as sanctions on Iran led to a loss of about 1 million barrels per day

F

inance ministers of the Group of Seven most industrialised nations urged oil-producing countries to raise output to ensure the market is well supplied, while warning that the West was ready to tap strategic oil reserves to offset rising prices that could hamper global growth. “We stand ready to call upon the International Energy Agency to take appropriate action to ensure that the market is fully and timely supplied,” the G7 said in a statement. “The current rise in oil prices reflects geopolitical concerns and certain supply disruptions. We encourage oil-producing countries to increase their output to meet demand.” Oil prices have surged as Western sanctions on Iran led to a loss of about 1 million barrels per day in crude exports from the OPEC member. Prices rose on Tuesday as Hurricane Isaac approached the oil rich U.S. Gulf coast. The administration of President Barack Obama said it was still open to possible release of oil from the Strategic Petroleum Reserve. “That option has been on the table for some time, and remains on the table, but we have no announcements to make today,” White House spokesman Jay Carney

told reporters traveling to Iowa with President Obama. Washington considered tapping emergency reserves in March but held off after oil prices declined. Reuters reported earlier this month that the White House was dusting off those plans and that some energy experts viewed Isaac as a potential trigger for such a move. The head of the IEA, which represents 28 oil consuming countries, voiced her strongest opposition yet to a release of emergency oil supplies. “Higher prices alone are not the trigger for an IEA collective stock release and at this moment we see that the crude oil market is adequately supplied,” Maria van der Hoeven said at an industry conference in Norway. Losses of crude exports due to this year’s sanctions on Iran “didn’t come out of the blue,” she said, adding that the United States would need to decide for itself whether Hurricane Isaac required a domestic stock release. Oil production in the U.S. Gulf of Mexico was down more than 90 percent on Tuesday as Hurricane Isaac headed toward Louisiana as a Category 1 storm. The hurricane bore down on New Orleans early yesterday

after making landfall. Energy analysts do not anticipate extensive damage to oil and gas infrastructure if the storm stays in line with current projections. Still, any supply disruptions could heighten pressure for emergency oil supplies to be released. “We remain vigilant of the risks to the global economy. In this context and mindful of the substantial risks posed by elevated oil prices, we are monitoring the situation in oil markets closely,” the G7 said. Finance ministers also noted that Saudi Arabia had committed at a G20 meeting of world leaders in Mexico earlier this year to use its spare oil production capacity to ensure adequate supply. The comments from the finance ministers are a strong signal that a release may be imminent, said Jan Stuart, head of energy research at Credit Suisse in New York. “A significant group of industrialised countries now appears to be ready to make reserves available – they know that when you make statements at this level, you also need to be ready to follow through,” Mr Stuart said. Reuters/AFP

U.K. fraud prosecutors may open a criminal probe as soon as this week into payments Barclays Plc made in 2008 to Qatar’s sovereign wealth fund as the bank sought to raise money, according to two people familiar with the case. The Serious Fraud Office, which prosecutes bribery and white collar crime, may inform the Londonbased bank about its decision on a probe this week, the sources told Bloomberg, who declined to be identified because the discussions are private. Prosecutors are working with the U.K. Financial Services Authority, Britain’s finance regulator, which is conducting a civil investigation into whether the bank adequately disclosed fees it agreed to pay the Qatar Investment Authority. The investigation would be another legal pitfall for Britain’s second-biggest lender by assets after it paid U.S. and U.K. authorities a record 290 million pounds (US$459 million) in June for manipulating the London interbank offered rate, or Libor, and related interest benchmarks. The case led to the resignations of three top Barclays executives, including chief executive Robert Diamond. SFO spokesman David Jones, Barclays spokesman John McGuinness and a spokesman for the QIA declined to comment. Barclays raised 7 billion pounds of capital from investors including the Abu Dhabi and Qatar sovereign wealth funds after the financial crisis began in 2007. The move allowed the bank to avoid a government bailout, unlike Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc. “The FSA is investigating the sufficiency of disclosure in relation to fees payable under certain commercial agreements and whether these may have related to Barclays capital raisings in June and November 2008,” the lender said in a statement on July 27.

Macau Business Daily, August 30, 2012  

Macau Business Daily, August 30, 2012

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