Last month's short essay (4 pages) is now published below. A little later than we would have liked, but it has been a busy month. The essay shares some reflections on China's growing influence in Africa, with a focus on our own country. The May essay will be out towards the back end of the month as usual! China New Colonialism in Africa...more
As we wait for the results of the Kenya Aiways rights issue, it seemed to have passed without any investment banks or stock brokers producing any independent analysis and recommendation on it's prospects. That’s not a 100% true as a Google search has found two broker reports on the KQ rights, one with a buy recommendation, and the other with an underweight recommendation - which usually means that the security is expected to underperform either its industry, sector, or even the market. Still, it's been almost impossible to get my stockbroker, or any other investment bank to share a copy of a report on KQ, or the earlier British American IPO. Yet a few years ago, most brokers were happy to share analysis (theirs, or from other brokers/banks) ...more
Twitter was all a buzz with news of a 100 day campaign to root out foreigners living in China illegally. According to the China Daily:
Popular Beijing spots for foreigners, such as Sanlitun and university areas, will be targeted by police in a fresh drive against visitors who commit crimes, outstay their visas or gain illegal employment, authorities said on Monday.
For some, it was a sign that China was after “them”, a feeling that certainly has resonated in the journo community following the Melissa Chen affair, but after 10 years in China and a memory of 3-4 formal visa check campaigns, I am pretty confident this will turn out to be a non-event for most.
Where this announcement is tangentially interesting to me though is that after going through the proces...more
LA Times reports:
BEIJING — After months of careful tinkering aimed at slowing China's supercharged economy, Chinese officials may have gotten more than they bargained for: The nation's economic engine is decelerating with alarming speed.Industrial production in April hit its slowest pace in more than three years, while growth in exports sputtered and imports were flat.In response, China's central bank over the weekend said it would ease reserve requirements for the nation's banks. The move frees about $70 billion for lending to stimulate the economy. But some economists said more aggressive action was required to keep China from a hard landing.A sharp downturn in China would be a blow for the global economy and in particular California, which...more
Tanzania's Precision Air has opened a new route between Lusaka and Dar es Salaam with a B737. The flights will be launched in May. The same month KLM begins the Schipol - Lusaka flights.South African Express (SA) has opened a new route between Lusaka and Durban effective July 2012, uisng the PRJ-200, 50-seater aircraft. The airline will fly three times a week with possibility of increasing to six flights. ...more
Mobis
Philipose
in Mint, Sunil
Jain in the Financial Express:
on the
SEBI order (by Prashant Saran) on the Tayals. Also
see coverage
on firstpost.
The great debate about Pranab Mukherjee as President of India: read
B. S. Raghavan
in the Hindu Business Line; Inder
Malhotra in the Indian Express.
Nick
Robinson in the Business Standard on strengthening the
rule-making process, i.e. the legal process for subordinate
legislation, in India.
The
next generation of reforms in India, a speech by Raghuram Rajan.
I just
read Carnage
and culture, by Victor Davis Hanson, and I recommend that
everyone who thinks about India and international relations and
military power should read it too.
As I
read Karim
Sadjadpour in Foreign ...more
Micheal Cole writes:
Real estate investors, manufacturers and professional investors are the wealthiest people in Shanghai, according to Shanghai Wealth Report 2012, which tracks the wealth of China’s super-rich.
The report, which was published on Friday by Hurun Report and the Australia-based independent financial adviser Gao Fu Wealth Management detailed China’s biggest billionaires and the sources of their wealth.
Read more: http://www.mingtiandi.com/real-estate/20120513/shanghais-billionaires-owe-their-fortunes-to-real-estate/?utm_source=mtd+real+estate+list&utm_campaign=1a31228e16-RSS_EMAIL_CAMPAIGN&utm_medium=email...more
[well worth the listen!] China’s insatiable thirst for #energy http://t.co/ieUleS34 #China #coal #cleantech #
HK High-Speed Rail Station (open 2015) looks AWESOME http://t.co/AkWt3f9b #hongkong #rail #transportation #
RT @TheAtlantic: #China #039;s biggest challenge isn't military or economic: it's basic #governance http://t.co/QYA3DCjG #
Update on Bringing Jobs Back to the United States http://t.co/Ug2B1kGS #insourcing #jobs #madeinusa #
Catering to the Self-Expressive Chinese Consumer http://t.co/BVUoCzgy #china #marketing #trends #
Writing post of 10 things I won't eat in China. Pork, bubble tea, shit on stick, and instant noodles top the list. Looking for 2 more.. #
[dare I say it... how typical] Brazilian Beaten Up For Stopping Thieves As C...more
A revealing recent exchange in parliament on Constituency Development Funds paints a picture of a corrupt and poorly administered fund. Yet, MPs still want it to be increased? ;Mr L. J. Ngoma (Sinda) : What has been the impact of the Constituency Development Fund (CDF) had been on the socio-economic development of constituencies from inception to date? And when is the CDF for 2012 going to be released to all the constituencies? Local Governmemt Deputy Minister Mr Tembo: I urge the House to pay attention as I give a comprehensive answer which is of benefit to all the 150 constituencies.The ministry has not measured the impact of the CDF on the socio-economic development of constituencies from inception to date. However, there are two major studies which were con...more
I recently traveled to Beijing to attend the 2012 Beijing Auto Show as well as to attend the Automotive News China Conference. While no one can expect to gain a full understanding of China during a quick trip like this one (indeed, one must live there for an extended period in order to learn that he can never fully understand China), such trips are often helpful for taking the pulse of what's going on at the moment.First, a bit about the conference. Like most industry conferences, this one is basically a big networking opportunity surrounded by presentations from industry notables. My greatest impression was that, despite less than impressive growth numbers in the first quarter of this year, everyone seemed very optimistic about the prospects for longer term growth in C...more
Following last week’s post, I was reminded by a reader about a post I wrote a couple years back , and I decided to update it as the core of the post was a list of foods that I generally avoid in China.
It is a list that has changed over time, but in looking back, I have done well to stick to it pretty well:
1) Domestic Dairy and Soy Milk product – I wasn’t worried about melamine, I was worried about hormones/ antibiotics use. This is one of those things that I have been looking at for a while. What I have found interesting through this crisis in confidence is that no one is looking at soy milk. It is not all that different in process if you remove the obvious difference between a cow and soybean. Both can be watered down, both can be thickened, b...more
Last week Family Bank announced the launch of a new product called M-Kanisa which allows church faithful to send their tithes and contributions to their Churches via mobile phone. It works with Safaricom's M-Pesa’s paybill and offers convenience and speed for church members who need to meet their tithing obligations to their churches or institutions. For the church, it needs open a bank account and share the paybill account with their congregation and the Church will also get Immediate notification via sms when tithes and offerings are deposited into the account. Another mobile money church service, discovered via twitter, is ZionCell which works on the Airtel Money from rival provider Airtel. With this one, Church members can also sign up for ...more
Silk Road Internatioonal Blog says:
Some fantastic opportunities to learn about China are more and more available in the US. While in the US this month I attended a couple of sessions of the UVU Doing Business with China seminar in Utah.
First, Andrew Hupert presented a great keynote address on Guanxi. All that needs to be said/known about this can be read in his great ebook: Guanxi for the Busy American. You can buy it at Smashwords. Some highlights include:
1. Relationships come before any contract (Guanxi as Due Diligence).
2. Relationships come after all contracts and work are completed (Guanxi Best Practices).
3. Get these relationships right or have never ending frustrations (Guanxi Myths and Realities).
Second, in a follow up on this, in a break out session o...more
That’s where I am now, and shortly after I landed I remembered all the things I love and hate about it. Not that I ever really forgot. And I definitely love it more than I hate it. But there were the usual frustrations.
Like when my taxi driver dropped me off at the hotel from the airport and drove away without giving me my change. It was only ten kuai, but still.
I decided to make this a budget trip and booked my hotel reservation at Ru Jia at Jiaodaokou. I stayed there with Lisa several months ago and we liked it. What’s not to like for 248 kuai a night at a good location? Alas, this time the main building was occupied and they sent me to a room in an ancillary building. I knew the second I stepped into the room that I was in trouble. It smelled like a toi...more
Comparing to last quarter and a year ago. The shares market seems to have bottomed out and share prices have surprisingly, for an election year, began to go back up after a long downward period. The StableBarclays ↑Bralirwa (Rwanda) ↑Britak ↑Diamond Trust Bank ↑East African Breweries (EABL) ↑Kenya Airways ↓Kenya Commercial Bank (KCB) ↑Kenya Oil Company (Kenol) ↑Safaricom ↑Scangroup ↑Stanbic (Uganda) ↓Uchumi ↑ReviewThe portfolio, excluding new shares, is up 12% since February 2012 while the Nairobi Shares Exchange main index is up 14% over the same period.Best Performer: Uchumi (up 109% in 3 months), Britak (33%) Scangroup, EABL, KCB, Kenol (all +20%)Worst Performer: Kenya Airways (down 20% in 3 months), Stanbic Uganda (due to excha...more
The new world of security in India
Only in a police state is the job of a policeman easy.
-- Orson Welles
The policemen of India say: It is only by using onerous and intrusive tracking procedures that we will be able to block the terrorism, the tax evasion, the money laundering. But society should be designed for the convenience of the median citizen and not for the convenience of the policeman. Yes, when citizens have liberty, it imposes more work upon the policeman. That is a tradeoff we should favour.
In every place in the world, I walk into a coffee shop, open my laptop, and go into free open wifi networks. Except in India. Open wifi networks are banned in India, because they make life difficult for policemen. This is a bad tradeoff : we have sa...more
Go now and read James Fallows’ latest. Superb; I don’t see how anyone can disagree with a single word.
I leave yet again for a trip tonight and may not be around much for a couple of weeks. Use this as another open thread.
...more
A recurrent theme in the field of public administration is the appropriate separation, between things done within government qua government, versus the things that are best contracted out.
Example: A fascinating question in finance is the supervisory role of exchanges. Do we want exchanges to be rule makers and the front line of supervision, or do we want them to be mere profit-maximising IT companies who run trading systems, with all regulatory/supervisory functions being performed by SEBI? Is the exchange a public utility or a mere business?
In the field of education, the question is: Should government be the producer of education services (building schools, worrying about drinking water at the school, hiring teachers etc.) or should the actual production be done b...more
This journalist clearly believes they do not.
Let’s stop jacking the Chinese around. We do not care a whit now — nor have we ever cared — about their human rights or any other aspect of their lives as long as they satiate our unbridled appetites. To pretend otherwise is to deny centuries of exploitative history in which the West drugged the Middle Kingdom and plundered it for its resources and cheap labor while obliterating any sign of popular resistance to our imperial sway.
From the Opium Wars to the contemplation of using nuclear weapons to bomb China back to the Stone Age because of our differences with it over Korea and Vietnam, the response of the West has been one of brute intimidation. Never have we been willing to acknowledge that China, for a...more
I am, generally speaking, quite sanguine about the long-term prospects of the world. I believe with good reason that the trends are positive, and I entirely dismiss the chicken littles that claim that the sky is falling. But my optimism tends to disappear when I have to travel. For all intents and purposes, it appears to me that the world is going to hell in a hand basket whenever I am forced to be a customer of the US air transportation system, like I was in the last few weeks when I went first to Mexico and then to the East coast. Most people in the US are unfortunately quite familiar with the unwelcome attention of the “Homeland Security” apparatus. It appears to be a farce but I fear that it will end up as a tragedy because the people have abdicated thei...more
~ ~ The Low Library, Columbia University My colleague Rajesh Jain was a speaker at the the Eight Annual India Business Conference 2012 at Columbia University on 14th April in New York City. It was held at the Low Library, a US national historic landmark building (picture on the right.) I was at the conference and had the opportunity to meet Prof Jagadish Bhagwati and Prof Arvind Panagariya. I am pleased to say that Rajesh’s talk was very well-received. Here’s what he said.
Rajesh’s point is that we know what needs to be done to transform India, for it to become a developed country. He therefore talked about the “how”. We have to change India’s governance. As he put it, “. . . the road map is there, what’s missing is ...more
Back in January, GM announced it wanted to buy back the 1% it had sold to its partner, Shanghai Auto (SAIC). In the post I wrote at that time, here was my prediction:The only way I can see this happening is if GM were to agree to set up the sales organization that SAIC had first proposed, which may be possible now that the US government is no longer a majority owner in GM (though still technically the controlling owner).As it turns out, this is exactly what is happening. According to an article (free registration required) from Automotive News China:Company CEO Dan Akerson told the Journal that the partners plan to split Shanghai GM into two units: sales and operations.General Motors would have a 50 percent share of the operations unit, which would make produc...more
On Tuesday (3 April 2012) major media outlets reported that Chinese Premier Wen Jiabao was getting ready to take on China's giant state-owned banks. He was quoted in an article in the Wall Street Journal:Let me be frank. Our banks earn profit too easily. Why? Because a small number of large banks have a monopoly...To break the monopoly we must allow private capital to flow into the finance sector.Setting aside the fact that there are too many banks in China for any one to have a monopoly (let us not forget that the "mono" part of monopoly means "one") Wen's criticism was definitely warranted. China's top five banks account for more than 55 percent of loans in China's banking system.On Tuesday I posted this WSJ article on Facebook and offered the comment that, "what Wen ...more
The natural reaction of a farmer to an increase in the price of a crop is to plant more of it for the following year. Supply and demand.
The difficulty comes in realising that you are not the only one thinking the same thing - the result is price bubbles leading to price crashes.
The role of the "middle man" or "supply chain" is particularly interesting in this story. Is this merely a lack of information on behlaf of the farmer? The introduction of widespread mobile phone technologies should help.
But what about the road tolls? There are some interesting economics to dig into here.
The Diplomat covers the story:
China’s Unhappy, Uneven Growth [The Diplomat]
../
But one incident stands out for me as representing an issue the government should be particularly...more
China is a thirsty country that needs a lot of water. To this end it is using a lot of dams in some very sensitive areas. There are a whole lot of "externalities" involved with dam production for those upstream, downstream and round about.
When those people live in different countries things can get messy quickly especially if two of those countries and China and India.
I like the concluding statement:
"Scarcity in a zero sum situation can lead to conflict but it can also goad countries into more cooperative behavior. It's a bleak picture, but I'm not without hope."
The author of the quote has more hope than I do - I can only guess that he is not an economist.
Water wars? Thirsty, energy-short China stirs fear [Yahoo]
BAHIR JONAI, India – The wall of water rac...more
The University of Birmingham's Director of the Business School, Professor David Dickinson reports on how he views recent developments in China's economy.
A sensible comment that touches on a number of issues that this blog has talked about in recent posts.
The Birmingham Brief
Is China’s economy a cause for concern?
Questioning China’s remarkable economic performance over the last 30 years seems to fly in the face of wisdom honed by decades of double digit growth. However, it is perfectly possible to explain China in the context of standard models of economic growth. Immigration of low-wage labour into the Eastern seaboard along with transfers of capital from Chinese Diaspora in Hong Kong, Taiwan and further afield, created the conditions for the ‘miracle’.
...more
Dr. Efraim Chalamish is an international economic law scholar and practitioner, geostrategy commentator, and economics and security analyst. He has been involved in international legal practice in New York, Paris and Israel, along with research and analysis of cutting edge areas in public and private international law and economics. He has also been teaching in various institutions in the US, Europe, and the Middle East.
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