Outlook: Will Japan recover position as world key player after?

Image via WikipediaWe had our internal meeting today, and one of the questions that I asked is how the company is managing the supply shortage with Japan out of the supply chain.

"They are scampering to switch substrates," was the answer. Who is the 'they'? Those in-charge, of course.

Anyway, that isn't the point at all.

The point is - that change is so massive, and so massive that if the future, in the event that Japan comes back to the playing field and starts producing, the switch back may not be that easy after all.

So the question is, when the time comes, and Japan springs back to production, will everybody else be willing to switch back?

I'm just preempting the possible extent of Japan's damage, even in its industries.

Will Japan ever recover position as world key player afterwards?

Just my thoughts...

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SECURITY FORCES NOW GET FIREARMS

Image via Wikipedia

A news article taken from TODAYOnline.com, Tuesday, 23-Mar-2010

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BANGKOK - Just as their protests seemed to be petering out, Thailand's red-shirted protesters vowed to "shut down" Bangkok with another rally on Saturday, defying the government which had raised the stakes with new security measures.

Starting yesterday, army officers guarding key sites including checkpoints, government buildings and military bases were supplied with firearms. Previously, the 30,000 military personnel deployed for the protests were not armed.

Army spokesman Colonel Sunsern Kaewkumnerd said the government was "very concerned" after several minor grenade attacks and wanted to "prevent ill-intentioned people from inciting unrest".

But he said army officers will be allowed to use their weapons "only in crucial situations in order to protect the lives of officials or the public".

On Saturday, two small grenade blasts hit Bangkok and a nearby province shortly after tens of thousands of anti-government protesters held a parade through the capital. One person was slightly injured.

A week ago, four grenades exploded at a Bangkok military base, wounding two soldiers.

Col Sunsern warned demonstrators that the army was also ready to take "decisive action" if they try to disrupt a Cabinet meeting scheduled for today at a ministry on the outskirts of Bangkok.

Deputy Prime Minister Suthep Thaugsuban said the government would extend a stringent security law for an additional week in Bangkok and two other provinces, Nonthaburi and Samut Prakan.

The Internal Security Act, which allows authorities to set up checkpoints, impose curfews and limit movement, had been enforced across eight provinces since March 11 and was due to expire today.

Protest leaders are seeking to regain their momentum, as the number of supporters gathered in the capital waned over the week.

Mr Jatuporn Prompan said their rally this weekend would be bigger than the noisy procession last Saturday, which drew around 65,000 people.

"On Saturday, we will shut down Bangkok and rally at provincial halls across the country," he said.

Finance Minister Korn Chatikavanij sought to downplay the impact of the protests, saying they had not deterred foreign investors in the country.

"The main issue ... is that we manage it in a civilised manner within the rules of law and under democratic principles," he told an investment conference in Hong Kong. AFP
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White House on China-Google case...

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White House 'disappointed' no Google, China deal
Posted: 23 March 2010 0627 hrs

WASHINGTON - The White House said Monday it was "disappointed" that Google could not reach a deal with Beijing, after the Internet giant announced it was no longer censoring its search engine in China.

"We are disappointed that Google and the Chinese government were unable to reach an agreement that would allow Google to continue operating its search services in China on its Google.cn website," National Security Council spokesman Mike Hammer said in a statement.

"Google made its decision based on what it believed was in its interest," he added, noting the White House respects the search engine's decision and was informed of it before the company made its announcement to the public.

-----

The Google logo on the rooftop of the Google China headoffice building in Beijing

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President Barack Obama's administration has previously raised its concerns about the matter with the Chinese government, Hammer recalled, stressing that US-China ties were "mature enough to sustain differences."

The administration is "committed to Internet freedom and... opposed to censorship," he added. "While we seek to expand cooperation on issues of mutual interest with China, we will candidly and frankly address areas of disagreement."

In announcing its decision to stop censoring its search engine in China and redirect mainland Chinese users to an uncensored site in Hong Kong, Google said it intended to continue research and development work in China and maintain a sales presence there.

China was quick to criticize the company for being "totally wrong" and having "violated its written promise," according to the state-run Xinhua news agency, which cited an official in charge of the Internet bureau of the State Council Information Office.

Google's lifting of censorship on Google.cn came a little over two months after the Mountain View, California-based company said it had been the victim of cyberattacks originating from China.

- AFP /ls

From ChannelNewsAsia.com; see the source article here.

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North Korea suspect ship has turned around, says US official

Posted: 01 July 2009 0803 hrs

North Korean ship, the Kang Nam I, is anchored in Hong Kong waters.

WASHINGTON: A North Korean ship tracked by the US Navy and suspected of transporting weapons or military know-how in violation of UN sanctions has turned around, a Pentagon official said.

The official declined to provide details, including where the Kang Nam 1 ship - reportedly originally bound for Myanmar - could now be headed, but news reports out of South Korea suggested the ship may be returning home two weeks after it set sail June 17.

A diplomatic source speaking on condition of anonymity told the Korea Herald that the ship was "near our waters," which could suggest that sanctions were having an effect on reclusive North Korea.

"If the ship is on its way back, it would mean that Resolution 1874 is taking effect and causing the North to retreat," Kim Tae-woo, vice president of the Korea Institute for Defense Analyses, told the newspaper.

The Kang Nam 1 quickly drew the attention of the US military under new UN sanctions designed to punish Pyongyang over its May 25 underground nuclear test.

The US ambassador to the United Nations, Susan Rice, confirmed Sunday that the United States was tracking the cargo ship.

"Obviously we're pursuing and following the progress of that ship very closely," she told the CBS network.

"I'm not going to get into our operational details or what we might actually do on the high seas, if anything, or what allies and partners in the region might do."

UN Security Council Resolution 1874, adopted in response to the May 25 nuclear test, calls for beefed up inspections of air, sea and land shipments going to and from North Korea, and an expanded arms embargo.

But a senior US lawmaker, Senate Republican Minority Leader Mitch McConnell, last week said the resolution had "serious limitations" because it rules out the use of military force to back up the searches.

- AFP/yb

From ChannelNewsAsia.com; see the source article here.

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Wall Street sinks along with consumer confidence

Posted: 01 July 2009 0558 hrs

Traders work on the floor of the New York Stock Exchange.

NEW YORK: Wall Street shares ended the second quarter in a slump on Tuesday after a surprise fall in consumer confidence dented hopes that spending will lead the country out of recession.

The Dow Jones Industrial Average shed 82.38 points (0.97 percent) to close at 8,447.00.

The tech-heavy Nasdaq dropped 9.02 points (0.49 percent) to 1,835.04 and the broad-market Standard & Poor's 500 retreated 7.91 points (0.85 percent) to finish at 919.32.

"The main culprit is an unexpected drop in consumer confidence, ending a two-month winning streak in that index," Charles Schwab & Co. analysts said in a client note.

The Conference Board, a business research group, said its consumer confidence index retreated to 49.3 points in June from a revised 54.8 in May.

Most analysts expected a much stronger reading of 55.3 points in the 100-point index.

Stocks turned sharply lower as investors digested the surprising decline in confidence which suggested recession-weary consumers were not ready to open their wallets to boost the spending that drives two-thirds of US economic activity.

"This latest setback in consumer sentiment does not auger well for any near-term revival in consumer spending," said Brian Bethune of IHS Global Insight.

Bethune warned that the government's massive economic stimulus efforts may "run the risk of engineering the biggest fiscal stimulus 'dud in post-World War II history."

"Despite the huge cash incentives being dangled in front of consumers to purchase homes - and prospectively to trade in gas-guzzling auto clunkers - households are not going for the bait," he said.

Still, the major indices ended the second quarter with robust gains. The blue-chip Dow jumped 11 percent in the past three months, the Nasdaq surged 20 percent and the S&P 500 advanced 15 percent.

Investors digested a raft of data in the holiday-shortened week, with the market closed on Friday for the July 4 Independence Day celebration.

The S&P/Case-Shiller index showed the decline in housing prices in the 20 top US cities slowed in April, to a drop of 18.1 percent, from a year ago.

Retail sales at chain stores rose in the past by the strongest gain since late January, the International Council of Shopping Centers reported.

Investors were focused on Thursday's unemployment report, which is widely expected to show the jobless rate climbed to 9.6 percent in June, up from 9.4 percent in May.

"The heavy burden of all of the people who have no jobs will bring down consumer spending and retail revenue, adding to this government's obligations as it struggles more and more with its growing debt load which will be compounded by falling tax revenue," said Douglas McIntyre of 24/7WallSt.com.

Among stocks in focus, United Technologies dropped 0.97 percent to 51.96 dollars and Caterpillar skidded 4.89 percent to 33.04 dollars.

ExxonMobil shed 0.95 percent to 69.91 dollars and Chevron slid 0.94 percent to 66.25 dollars as crude oil prices headed lower.

Walt Disney dipped 1.39 percent to 23.33 dollars after the entertainment giant and the Hong Kong government on Tuesday reached an agreement to expand the city's beleaguered Disneyland amusement park.

The bond market weakened. The yield on the 10-year US Treasury bond rose to 3.523 percent from 3.492 percent on Monday and that on the 30-year bond advanced to 4.311 percent from 4.307 percent. Bond yields and prices move in opposite directions. - AFP/de

From ChannelNewsAsia.com; see the source article here.

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Hong Kong yet to emerge from financial crisis

Posted: 28 June 2009 1808 hrs

Residential property (top-R) on Victoria Peak overlooks the skyline of Hong Kong

HONG KONG: Hong Kong has still to emerge from the effects of the global economic slowdown despite early signs of returning stability, the city's chief executive Donald Tsang has said.

Tsang said that big challenges remained for the city, whose key industries of finance and exports have been hit hard by the crisis.

"There is no doubt we have yet to emerge from the impact of the financial tsunami," he said on local broadcaster RTHK's weekly Letter to Hong Kong.

"While recent statistics have shown some signs of economic stability returning, there are still many uncertainties in the global market."

He said reforms put in place after the Asian Financial Crisis of 1997 meant Hong Kong had not suffered a breakdown in its financial system.

He said that the latest crisis presented similar opportunities to improve the city's economic fundamentals.

The government has pointed out six sectors the city should focus on -- including education and environmental industries.

Tsang countered accusations that such directives went against Hong Kong's free market economic principles.

"Hong Kong has thrived as a free and open market. This must and will continue," he said.

"At the same time, increasing globalisation and regional competition have resulted in a need for a strong government role in facilitating economic development.

"So, we are not picking winners. Rather, we are providing a more favourable environment for industries to become even bigger winners than they are now."

Hong Kong fell into recession in the third quarter of 2008 and in May the government slashed its growth forecast for this year, saying the economy would contract 5.5-6.5 percent in 2009, from a previous forecast of 2.0-3.0 percent.

- AFP/ir

From ChannelNewsAsia.com; see the source article here.

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China's ships idle but Shanghai port charges ahead

Posted: 28 June 2009 1457 hrs

Yangshan deep water port in Hangzhou Bay, south east of Shanghai.

SHANGHAI: The scene where Shanghai's river meets the sea is a snapshot of China's battle against the financial crisis - as well as the site of the port the country hopes can set the stage for the next boom.

Empty container ships - victims of China's export collapse - line the river banks in Shanghai's port.

Meanwhile, bulk carriers laden with raw materials - a bet on demand rebounding - wait at sea because ports cannot unload them fast enough.

"Just look at the Huangpu River," a shipping company dispatcher said, referring to the waterway that cuts through Shanghai. "There used to be a few ships anchored on the river but now you can see anchored ships everywhere."

"Charter rates are so low now we would rather anchor the ships and save the cost of crew and fuel," the dispatcher for state-run Shanghai Puhai Shipping Co. said on condition of anonymity because he was not allowed to speak to reporters.

World shipping prices in the past week were down about 68 per cent from a historic peak in May last year, according to the Baltic Exchange Dry Index, which gauges international dry bulk good shipping prices.

Low shipping rates combined with weak commodity prices sparked a Chinese buying spree of iron ore and other commodities that has led to jams of bulk carrier traffic at Chinese ports.

But that has not offset volume lost due to seven straight months of plummeting exports, which were down 26.4 per cent year-on-year in May.

The volume handled at Shanghai's port was down 15 per cent in the first five months of 2009 after nearly a decade of 20 per cent annual growth, Shanghai International Port Group Vice President Huang Xin said this past week.

"This is the first time Shanghai's shipping container business declined since it went into full-scale operation (20 years ago), it shows how deeply the financial crisis has affected the real economy," Huang told a maritime conference in Shanghai.

Chinese shipbuilders fared even worse, with orders plunging 96 per cent to 1.18 million deadweight tons in the first five months of the year compared to the same period last year, according to government figures.

"This will be the worst year ever for the container port industry in terms of volume decline," Truong Bui, a consultant at Drewery Maritime Services said. "China's container traffic will not recover until 2011."

Despite the plunge in shipping demand, Shanghai - already the world's busiest port by total cargo volume - is charging ahead with plans initiated during boom times to more than double its capacity.

China's cabinet set ambitions for Shanghai even higher in April, declaring it would move up the value chain and become a full-service world-class shipping centre by 2020.

But building the infrastructure will be easier than developing the service side of that equation, Xu Jianqun, Shanghai's Construction and Transport Commission Secretary General, warned.

"We lack the related 'software' in terms of ship financing, reinsurance for ships and arbitration," Xu told the same conference. "This leaves Shanghai lagging behind other developed port cities in the world."

The centrepiece of its expansion will be the Yangshan Deepwater Port, which connects to the mainland via a 32.5-kilometre (20-mile) bridge.

Shanghai also plans to build the world's biggest shipbuilding yard on its northern Changxing island and put in place rail lines to better link the port to industrial powerhouse regions, Xu said.

On the services side, the Bank of Communications, part-owned by HSBC and China's fifth-largest bank, announced last month plans to create a ship financing division.

Some argue the need for the extra capacity is debatable but Torben Skaanild, chief executive of the Baltic and International Maritime Council, said Shanghai's moves come as the shipping industry faces a historic shift.

"The timing is probably absolutely perfect. There has been a shift in ship-owning towards the East and Asia," Skaanild said. "But there will be stiff competition because Hong Kong, Singapore, Japan and Korea are not going to let Shanghai stand alone."

- AFP/yb

From ChannelNewsAsia.com; see the source article here.

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Private investment into water to double in Asia Pac over the next 5 years

By Rachel Kelly, Channel NewsAsia | Posted: 24 June 2009 2101 hrs

SINGAPORE: Even as the current credit crunch is causing the flow of funds to dry up around the world, private investment into Asia Pacific's water industry is expected to double in the next five years.

Private sector investment currently accounts for around 15 per cent of the investments into the infrastructure industry. Experts said this should grow to the global average of 30 per cent in the coming five years.

That's according to industry experts at KPMG who spoke on Wednesday on the sidelines of the Singapore International Water Week.

Experts are bullish on the sector and said the current environment presents high-value opportunities for investment.

Len Rodman, chairman, president & CEO, Black & Veatch, said: "There's probably not been a better time to buy then right now because the cost structure for many of the vendors and constructors has been reduced significantly.

“There is better access to labour and the commodities that go into projects. And some are seeing 10, 20, 30 per cent reduction in capital costs by doing projects now rather then the trend that occurred a year ago."

Experts at KPMG said that over the last five years private investment into infrastructure in South Asia, East Asia and Asia-Pacific was some US$166 billion.

And out of this, five per cent was pumped into the water sector which is around US$9 billion.

The private sector is expected to increase participation into the water industry. However some experts said that there is need for more innovative financial structures.

Sharad Somani, executive director, KPMG, said: “I think there is a lot of realisation in the private sector that they can add value in various parts of the value chain. What research and development has started showing is that membrane technology has improved.

“So if the private sector has to come in, we have to think of a lot of innovative solutions for them to participate in like these projects.”

One company that is actively investing in the sector is Japanese firm Toray.

It has just announced a S$10 million investment into a research and development facility in Singapore.

Toray has also signed a Memorandum of Understanding with Nanyang Technological University's Nanyang Environment and Water Research Institute to conduct membrane research in Singapore. - CNA/vm

From ChannelNewsAsia.com; see the source article here.

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Chinese regulators may block purchase of Hummer

Much hope, almost, for GM… to the drain?

----------

Posted: 06 June 2009 0016 hrs

A Hummer vehicle

SHANGHAI: A little-known Chinese machinery maker's plan to buy the Hummer brand from General Motors could face objections from Chinese regulators, media reports said Friday.

Struggling US auto giant General Motors announced this week it had reached a tentative deal to sell the brand to privately-held Sichuan Tengzhong Heavy Industrial Machinery Co, a day after filing for bankruptcy.

"Government agencies are unlikely to agree," the official Shanghai Securities News reported, citing an unnamed source.

"This overseas acquisition is not in line with the state's auto industry policy. In principle, domestic auto companies are not encouraged to make outbound acquisitions at the moment," the source told the newspaper.

The deal, expected to be closed by the end of the third quarter, will need nods from several government agencies, including the Ministry of Commerce and the National Development and Reform Commission, a powerful economic planner.

There are also concerns over whether Tengzhong is capable of funding the deal to help revive sales of the gas-guzzling sports utility vehicle, against Beijing's policy to encourage fuel-efficient vehicles.

The Chinese company and General Motors did not disclose any financial details of the deal but analysts expect Tengzhong could pay up to 500 million dollars for the Hummer brand.

Tengzhong, based in Chengdu city in southwestern Sichuan province, manufactures heavy machinery equipment for use in road and bridge construction, and in the energy industry.

Officials at Tengzhong declined to disclose the company's financial performance when contacted by AFP.

Reports in Shanghai Securities News and other domestic media said the company was indirectly controlled by 46-year-old mining tycoon Li Yan, who is also the chairman of mining company Lumena Resources Corp.

Lumena, preparing to list shares on the Hong Kong Stock Exchange, plans to raise up to 1.48 billion Hong Kong dollars (190 million US dollars) from the initial public offering, the reports said.

- AFP /ls

From ChannelNewsAsia.com; see the source article here.

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Market panic: Wild gyrations, risks and opportunities in stock markets

BRAIN FOOD

Stephen Vines

Should investors be dumping stocks just because it's a recession?

No, as there are always chances to take advantage of the downturn, says author and successful businessman Stephen Vines.

In Market Panic, Vines, a former journalist whose Hong Kong-based company Pan Britain provides consultancy services to major corporations in East Asia, takes a hard look at current trends and offers simple tips for succeeding in volatile markets.

He challenges some long-held theories about the benefits of investment diversification; offers new ways of understanding the panic cycle and teaches investors how to predict the onset of panics.

"Stock markets show remarkable resilience in the face of crises, scandals and all other forms of extreme behaviour," Vines writes. "If more people understand the opportunities arising from markets at their supposedly weakest moments ... the potential for profit is greater than when fear, irrationality and extreme behaviour dominate stock markets."

Vines provides real-life case studies by interviewing fund managers and traders, who tell how they were caught in market panics and how they countered these challenges head on.

The book is easy to follow and jargon-free, perfect reading material for the budding investor. ZUL OTHMAN

From TODAY, Business – Monday, 01-Jun-2009

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A chance to replenish reserves

BUSINESS ANALYSIS

Rosalind Mathieson

THE recent slide in the US dollar against Asian currencies provides central banks in the region with the opportunity to do some quick replenishing of their foreign exchange reserves.

Buying the US dollar now means central banks can put some gas back in the tank for what could be a dollar renewal in the later part of the year — which may require the authorities in Asia to then sell the greenback to protect their local currencies.

And, of course, US dollar buying right now fulfils another aim, namely to keep a lid on emerging market Asian currencies in order to rekindle export demand.

There is the perception that foreign exchange reserves in Asia have been badly run down in the past year or so. Reserves are actually not as low as some people might think, but they have certainly been depleted by the heavy volatility in currency markets and the ongoing presence of a large speculative contingent.

Indeed, HSBC currency strategist Daniel Hui in a recent report estimated that regional reserves, ex-China, have fallen by a fifth in the past year.

Some central banks are already stepping up their US dollar buying, with those in South Korea, Hong Kong and Thailand spotted of late. The Monetary Authority of Singapore is also likely to have been keeping a lid on the Singapore dollar in order to maintain the currency's undisclosed price band.

US dollar weakness may persist in the near term for several reasons. One is that concerns have been brought front-and-centre of late about the US fiscal position, and the heavy amount of debt being taken onto the government's books.

Another is that some of the data from Asia have been showing a bit of resilience — though the emphasis there should be on the "bit" — and this, coupled with a rise in stock markets, has stoked a measure of risk appetite. Inflows have risen to emerging markets, pushing up stocks and currencies alike.

But central banks will want to avoid that going too far. Financial markets and economies alike are still very vulnerable, the recovery indicators are patchy and mild, and for some there is still the sense the worst is it not over for Asia or Europe.

So buying the US dollar now has a dual impact. It prevents Asian currencies from rising too quickly, and it allows central banks to put more ammunition in their arsenals should there be further economic or financial headwinds ahead.

Asian central banks are notoriously paranoid about depleting their reserves, having worked so hard to build them up since the previous financial crisis. They are very keen to make sure the coffers don't get whittled down again. That means "smoothing" operations to buy the greenback are likely to continue, and intervention could pick up in the coming months across Asia as a whole.

That should leave traders a little wary about pushing Asian currencies too high in the near term. The gains are momentum-based, not structural. Dow Jones

From TODAYOnline.com, Business – Wednesday, 27-May-2009; see the source article here.

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Oil prices bounce above $60 in New York

AFP - Wednesday, May 20

Oil rigs extract petroleum in the Los Angeles area community of Culver City, California. Oil prices jumped to a six-month high above 60 dollars on Tuesday on growing signs of economic recovery amid concerns about unrest in African crude producer Nigeria, traders said.

LONDON (AFP) - - Oil prices jumped to a six-month high above 60 dollars Tuesday on growing signs of economic recovery amid concerns about unrest in African crude producer Nigeria, traders said.

New York's main futures contract, light sweet crude for delivery in June, rallied to 60.48 dollars a barrel -- a level last seen on November 10. The contract later stood at 59.90 dollars, up 87 cents from Monday's close.

Brent North Sea crude for July delivery touched a six-month high of 59.65 dollars a barrel before pulling back to 59.05 dollars, up 58 cents from Monday.

"Gains in the stock market increased optimism that the global economy is recovering," said BetOnMarkets analyst David Evans.

Global equity markets posted fresh gains Tuesday on hopes that the global economy is through the worst of its slump, setting the stage for a pick-up in energy demand, dealers said.

In early afternoon stock market trading in Europe, Frankfurt rallied 2.03 percent, Paris gained 0.82 percent and London climbed 0.61 percent.

In Asia, Hong Kong added 3.06 percent, Tokyo put on 2.78 percent, Seoul advanced 2.99 percent, Sydney added 2.19 percent and Taipei gained 1.18 percent.

Oil jumped by around two and a half dollars on Monday as traders tracked prospects of a global economic recovery, rising shares on Wall Street and developments in Nigera.

New York share prices shot higher Monday after better-than-expected earnings from home improvement retailer Lowe's helped reinforce hopes for a recovery in the United States.

A strong US economy is a key growth engine for the world because it is a major export market for many countries -- and is the biggest energy consuming nation on the planet.

Prices were also boosted by rising violence in oil exporter Nigeria, where the country's main armed group said it had ordered a blockade of key shipping channels in a bid to inflict further damage on the energy industry. Nigeria's military has urged oil firms to ignore the threat.

"Fresh violence in Nigeria helped to support prices," said VTB Capital analyst Andrey Kryuchenkov. "Militants there claimed to have sabotaged two pipelines, while threatening more supply disruptions."

Unrest in the oil-producing Niger Delta region has reduced Nigeria's daily output to 1.76 million barrels compared with 2.6 million barrels in January 2006.

From Yahoo! News; see the source article here.

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Amid the signs of recovery...

CHANNELNEWASIA: MONEY MIND

Is now the time to invest in Asian property stocks?

Frederick Lim, frederickl@mediacorp.com.sg

THE 20- to 30-per-cent rally in Asian property stocks in the past few months is not sustainable, say experts, who believe prices are likely to fall further for most markets in the months ahead.

Henderson Global Investors thinks the current rally in property counters is not being backed by fundamentals.

“In the physical property market, values are clearly falling in most, if not all, markets,” said Mr Patrick Sumner, head of Property Securities at Henderson Global Investors. He believes there is a strong chance property values in Asia could fall further if banks that have been holding back on forced-selling of distressed assets bring them onto the market.

“You have quite a large volume of properties which are not being sold. If the banks actually start forcing the sales of these properties, they would make their own balance sheets look rather shaky. I think it will take some time for the whole market to clear at a price that both sellers and buyers find satisfactory,” said Mr Sumner.

According to Henderson, the recent rally in property securities has been driven by positive sentiment in the equity markets.

But property developers suggest there are signs that the property market is turning positive, based on sales volumes, and that could provide some support for property stocks ahead.

Yanlord, a high-end property developer based in China, said certain segments of the Chinese real estate market are showing signs of recovery.

“We have seen our transaction volumes increase from about 200 million yuan in November and December last year to 1 billion yuan ($215 million) in March this year,” said Ms Michelle Sze, head of Investor Relations at Yanlord.

Mr Justin Chiu, executive director of Hong Kong developer Cheung Kong Holdings, said the time is ripe to look for opportunities in the real estate sector.

“As real estate fluctuates in tandem with economic cycles, the current downtrend in Asia has opened up opportunities for favourable entry,” he said.

He believes the best opportunities are likely to be found in markets like Hong Kong, Singapore and, in particular, China.

As for the Singapore property market, developer CapitaLand is seeing a medium-term rebound for the high-end segment, especially with Singapore trying to attract top foreign talent.

“Singapore aims to become a global city focusing on wealth management, high-end talent and lifestyle. Does this strategy have legs? I, for one, am very confident,” said Mr Olivier Lim, group chief financial officer at CapitaLand.

For more on this story and other investment-related topics, catch Money Mind this Sunday at 9.30pm on Channel NewsAsia.

From TODAY, Business; Friday, 15-May-2009

Corporate woes rise as Asia reels from crisis: IMF

AFP - Wednesday, May 13

Corporate woes rise as Asia reels from crisis: IMF

WASHINGTON (AFP) - - The global financial crisis is taking an increasing toll on Asia's corporate sector with the region's economies now among the world's hardest hit, a senior IMF official warned Tuesday.

"Corporate risks are rising and market indicators are flashing warning signs," IMF deputy managing director Takatoshi Kato said.

"There are signs that even the best Asian corporate 'names' are being rationed out of financial markets and are considering approaching their government for direct assistance," he told the annual meeting of the Pacific Economic Cooperation Council, a regional think tank, in Washington.

Large Asian firms, like their US counterparts, entered the crisis with strong balance sheets and when the demand shock hit, they faced little immediate pressure to scale back their activities or cut costs, he said.

"However, liquidity positions have since dwindled."

Kato said the global economic downturn is hitting Asia more severely than other regions with fourth quarter data showing a decline in output of nearly 15 percent in Asia, excluding China and India.

Many small and medium-sized enterprises, he said, were also suffocating under the weight of the global crisis, which stemmed from a US home mortgage meltdown that triggered financial turmoil and slammed the brakes on growth.

The firms borrowed heavily during the previous decade to expand their activities as suppliers to larger manufacturing groups but with the onset of the crisis, banks immediately started to rein in lending to these firms, Kato said.

Bad corporate loans were also expected to taint bank balance sheets in Asia.

"The feedback loop between the financial and real sectors is expected to play out," Kato said.

"Given the likely prolonged nature of the downturn, non-performing loans are likely to rise. This will feed into bank balance sheets."

Kato said large Asian corporations would need to further cut production if the credit crunch combined with a sharp fall in demand put healthy companies into trouble and scuttled profits.

Predicting that the region could see a wave of consolidation through mergers and acquisitions, he said firms were only now beginning to adjust employment levels.

"In the near-term, the process may prove quite painful, particularly if large job losses are involved," he said.

"Already, unemployment has started to climb across the region and potentially high social costs from this downturn are a looming threat."

Kato said that as financial activity worldwide shrunk, Asia's financial centers "have also been broadsided."

Citing Hong Kong, the special administration region of China, he said its financial system was "contracting," particularly in areas such as asset management and brokerage services.

In Singapore, lending to non-bank customers has been contracting recently in the Asian Dollar Market, he said.

In Japan, stricter lending standards, wider risk spreads, and the significant stock market declines have tightened financial conditions, he said.

Kato also noted that private investment in most Asian countries had slowed significantly and warned about a slowdown in private consumption as well.

"Although private consumption so far has shown relative resilience, falling incomes and tighter financial conditions foreshadow a slowdown ahead."

On the whole, Kato said the current recession in the region promised to be "deeper and more prolonged" compared to previous cycles.

From Yahoo! News; see the source article here.

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