Li says Shanghai poses challenges for HK

Li says Shanghai poses challenges for HK
27-03-2009

The chairman of Cheung Kong, Li Ka-shing, says the decision to turn Shanghai into a global financial centre would pose challenges for Hong Kong. He also expressed the view that the mainland would be the first to recover from the economic crisis. The mainland media reported that the State Council had given the go-ahead for Shanghai to become a global financial and shipping centre by 2020. Mr Li said he was glad to see the development. But he said the move would inevitably pose challenges to Hong Kong. However, he said it was fine for both cities to be financial hubs. Asked about the current state of the economy, Mr Li said recent economic figures from the US were encouraging, including rising factory orders and home sales, smaller inventories, plus the rebounding stock market. He said the world economy would benefit if the American economy stabilized. He said said China would be the first to recover from the financial crisis, and Hong Kong would benefit from the policies of the central government. He also said a recovery in the US would not be too far away, as the government had put various measures in place to curb unemployment and stimulate the economy.

Minmetals bid for Oz Minerals rejected

Minmetals bid for Oz Minerals rejected
28-03-2009

Australia has rejected state-owned Minmetals' US$1.7-billion bid for Oz Minerals. Treasurer Wayne Swan noted in a statement that the government would only approve the deal if it excluded the Prominent Hill copper-gold mine. The mine is located close to a weapons-testing range in a rural part of south Australia. Mr Swan said the government was willing to consider alternative proposals. Minmetals said it would consider this.

China ready to contribute more to IMF

China ready to contribute more to IMF
28-03-2009

China says it's ready to contribute more money to the International Monetary Fund but wants changes in the body's governance structure. Vice Premier Wang Qishan wrote in the British newspaper The Times that the IMF should raise the money through voluntary contributions or its quota system but if that failed the IMF could issue bonds, and China would be a buyer. The offer comes ahead of next week's London summit of leaders of the Group of 20 major economies on the global financial crisis. Mr Wang said global financial reforms should focus on "readjusting the governance structure of international financial institutions" - a reference to Beijing's demand for a bigger voice in the IMF, the World Bank and other bodies.

CITIC Pacific posts loss of HK$12.7bn

CITIC Pacific posts loss of HK$12.7bn
26-03-2009

CITIC Pacific has recorded its first-ever loss, due to bad bets on currency contracts. The conglomerate posted a HK$12.66-billion net loss. The company's chairman, Larry Yung, says he's hoping to return the company to profit this year, following the injection of capital from the firm's parent company.

FS says HK complements Shanghai

FS says HK complements Shanghai
26-03-2009

The financial secretary, John Tsang, says Hong Kong will actively complement Shanghai in providing better services to the country. His comments came after the mainland State Council endorsed plans to make Shanghai an international financial centre. Mr Tsang said China can have more than one international financial centre, as different regions have different service needs.

Hutchison Whampoa profit falls 42%

Hutchison Whampoa profit falls 42%
26-03-2009

Hutchison Whampoa says its net profit in 2008 fell 42 percent, after one-off disposal gains strongly boosted its earnings the previous year. The figure of HK$17.66- billion was down from HK$30.6 billion in 2007. Total revenue rose 13 percent to HK$348.3 billion. The company's 2007 profit was boosted by a net gain of HK$35.8 billion from the sale of its 67 percent stake in Indian phone network Hutchison Essar to Britain's Vodafone.

Obama confident plan will succeed

Obama confident plan will succeed
24-03-2009

President Obama says he's very confident his administration's bank rescue plan will succeed. Announcing the details of the plan, the US Treasury Secretary, Timothy Geithner, said the government would use about US$100-billion of bail-out money to encourage private investors to buy up the toxic assets of banks.

Mr Obama said he hoped the plan would give the US economy the boost it needed.

Brown calls for global regulation

Brown calls for global regulation
25-03-2009

Britain's prime minister has called for global standards of financial regulation. Gordon Brown, who hosts the G-20 summit next week, said regulatory standards should be set "across Europe and the world". Mr Brown was speaking to members of the European Parliament at the beginning of a brief world tour aimed at building support for a deal on the global economy at the summit. He insisted that an injection of funds into the world economy would be "twice as effective" if all countries followed suit.

WTO warns global trade will shrink by 9%

WTO warns global trade will shrink by 9%
24-03-2009

Global trade flows are set to shrink by 9 percent during 2009, according to a forecast by the World Trade Organization.

Hardest hit will be developed nations, where trade is set to fall 10 percent.

Poorer countries will see exports fall 2-3 percent. The WTO blames the deepening recession for the downturn, but says trade could be "a potent tool" for recovery.

It would be the biggest drop in trade since World War II, said WTO Director-General Pascal Lamy, who called on global leaders to fight protectionism.

Trade is one of the top issues on the agenda when the heads of state and government of the world's leading economic powers meet at the G20 summit in London on April 2.

"In London G20 leaders will have a unique opportunity to unite in moving from pledges to action and refrain from any further protectionist measure which will render global recovery efforts less effective," said Mr Lamy in the organisation's annual assessment of world trade.

He warned that the use of protectionist measures was on the rise, with dangerous consequences: "Many thousands of trade related jobs are being lost.

governments must avoid making this bad situation worse by reverting to protectionist measures which in reality protect no nation and threaten the loss of more jobs."

HK$5-bn injection to defend peg

HK$5-bn injection to defend peg
24-03-2009

The Hong Kong Monetary Authority has injected HK$5- billion into the local banking system to maintain the currency peg with the US dollar. Its chief executive, Joseph Yam, said the move was necessary because of a large influx of money into Hong Kong in the past two days. He said that the extra funds would help reduce borrowing costs and boost the economy. Commenting on the US plan to tackle toxic bank debts, Mr Yam said it was a right decision to make because governments should help tp normalise markets when they fail to function properly.

China Telecom profit falls 96%

China Telecom profit falls 96%
24-03-2009

China Telecom has recorded a 96-percent fall in profit for last year to 884-million yuan - the lowest level since the company went public in 2002. The sharp plunge was due to a 24-billion yuan impairment charge as it wound up its "Little Smart" services - a limited-range mobile network - last year. Natural disaster took place last year also cost the operator 3.4 billion yuan.

US plan boosts world share prices

US plan boosts world share prices
24-03-2009

Global share prices have surged following the announcement of the US plan to remove toxic assets from the balance sheets of American banks. In Hong Kong, the Hang Seng Index was up 462 at 13,910 - or 3.4 percent - its highest level in more than 10 weeks. The Nikkei Index in Tokyo gained 3.3 percent. The rally was led by HSBC, which added 9.8 percent to HK$45.80, while its rights shares soared 32 percent. Dealers said the local market is likely to consolidate in the near term after having risen 8.4 percent already this week. DBS Vickers Securities director Peter Lai said he expects the index to take a breather soon. "The new measures (by the US) lend more support to HSBC with its US exposure, but further upside is likely to be limited for the counter at around HK$46 in the short-term," he said. Conita Hung, head of equity markets at Delta Asia Financial, said she expects the index to find support at 13,200. "We see that market sentiment improved a lot in the past two weeks, but I think the index will soon find resistance at 14,000," she said.

BOCHK profit slumps 78%

BOCHK profit slumps 78%
24-03-2009

Bank of China Hong Kong has posted a 78-percent slump in profit for last year, to HK$3.3-billion. The bank blamed the global financial crisis and market volatility for the lower-than-expected earnings. It made a provision of just under HK$12-billion. The Chief Executive of the bank, He Guangbei, said he was cautious about the business outlook. He said the bank has frozen staff pay this year, but has no plans for large-scale lay-offs.

French consider law to limit bonuses

French consider law to limit bonuses
24-03-2009

The governing party in France says it's prepared to introduce a law to limit executive bonuses, after a public outcry over excessive awards at a time of financial crisis. A party spokesman, Frederic Lefebvre, said the government would act because the employers' federation had not. Executives at the French bank Societe Generale yesterday handed back share options after President Sarkozy said they were unacceptable while the bank relied on state funds.

China vows to continue buying US bonds

China vows to continue buying US bonds
24-03-2009

The Central Bank says buying US government bonds will remain an important element of China's investment strategy. The comments were made by the bank's deputy Governor, Hu Xiaolian, who also said that China would pay close attention to any fluctuations in the value of those assets.

AIG bonuses larger than thought

AIG bonuses larger than thought
22-03-2009

The attorney-general of the US state of Connecticut says documents turned over to his office by American International Group show the company paid out US$218 million in bonuses, higher than the US$165 million previously disclosed. Attorney-General Richard Blumenthal's office received the documents late on Friday after issuing a subpoena. Mr Blumenthal says the documents show that 73 people received at least US$1 million apiece, and five of those got bonuses of more than US$4 million. The financially ailing insurance giant has been under fire for giving bonuses after receiving more than US$182 billion in federal bailout money. AIG spokesman Mark Herr declined to comment. MR Blumenthal said the newly revealed number will ``further fuel the justified anger and revulsion that people feel.''