Thursday, April 1, 2010
April 01, 2010, 12:44 PM EDT
More From Businessweek
U.S. Trade Office Targets China’s Procurement Policy (Update1)
Beijing Auto, CT&T Plan to Form Electric-Car Venture (Update1)
Dai-ichi’s Watanabe Aims for Asian Expansion After Japanese IPO
N.Z. Dollar Drops as IMF Says Currency Overvalued, May Weaken
U.S. Stock Futures Gain on China Manufacturing, Jobless Claims
e-mail this story print this story digg this save to del.icio.us add to Business Exchange By Simone Meier and Shobhana Chandra
April 2 (Bloomberg) -- Factories from China to the U.S. accelerated in March, pointing to a rebound in international trade that is contributing to a global economic recovery.
Manufacturing in China grew for a 13th month and U.S. factories expanded the most since July 2004, reports showed. Business sentiment in Japan rose to the highest since 2008, while factories in Britain and the euro region stepped up production.
Surging economic growth in China is helping pull the global economy out of its worst slump in more than six decades and benefiting companies from Honeywell International Inc. in the U.S. to Germany’s Bayerische Motoren Werke AG. Stocks around the world rallied after the manufacturing figures showed the expansion may be gaining strength.
“It is a global growth story, clearly a revival of global trade,” said Jay Feldman, an economist at Credit Suisse in New York. “U.S. manufacturing is firing on all cylinders, with exports doing some of the heavy lifting. It’s a sign global growth is strong.”
The Purchasing Managers’ Index for China rose to a seasonally adjusted 55.1 in March from 52 the previous month, Hong Kong-based Li & Fung Group said yesterday. Readings above 50 signal expansion.
The Tankan index of sentiment in Japan improved to minus 14 in March from minus 25 in December, while Europe’s factories expanded at the fastest pace in more than three years. A gauge of U.K. manufacturing rose to a 15-year high.
The MSCI Asia Pacific Index climbed 0.9 percent to 126.25 yesterday. The Stoxx Europe 600 increased 1.3 percent to 267.02 at 4:41 p.m. yesterday in London, while the Standard & Poor’s 500 Index advanced 0.7 percent to 1,177.96 at 12:37 p.m. in New York on April 1.
The International Monetary Fund forecasts the global economy will grow 3.9 percent this year after a 0.8 percent contraction in 2009 with China expanding 10 percent, almost five times the pace expected for the U.S. The euro area economy may expand 1 percent, the IMF forecast in January.
In China, the acceleration may buttress the case for Premier Wen Jiabao’s government to consider allowing gains in the yuan for the first time since mid-2008 and raising interest rates. Central bank Governor Zhou Xiaochuan said last month that “sooner or later” China will end the contingency measures it adopted during the global recession.
Led by China
“There’s a very strong pick-up in global trade,” said Jacques Cailloux, chief European economist at Royal Bank of Scotland Group Plc in London. “It’s a cycle that started in Asia led by China that’s now filtering through to developed economies and Europe in particular.”
Manufacturing in Germany, Europe’s biggest economy, expanded at the fastest pace in 14 years, yesterday’s data showed. In Switzerland, a measure of manufacturing activity jumped last month to the highest in more than three years, while Ireland’s manufacturing industry grew for the first time since 2007.
In the U.S., the ISM’s gauge of export orders jumped to 61.5 in March, the highest since September 1989, from 56.5. The production index rose to 61.1 from 58.4 the prior month, and the new orders gauge increased to 61.5 from 59.5.
Honeywell, the Morris Township, New Jersey-based maker of controls for planes and buildings, this week raised its first- quarter profit forecast on stronger orders and cost controls. BMW, the world’s biggest maker of luxury vehicles, last month forecast 2010 deliveries to rise with Chinese sales projected to show a “strong double-digit” percentage gain.
“The expansion we’re seeing is largely an export story,” said David Tinsley, an economist at National Australia Bank in London. “So, even now you’ve got very robust rates of growth according to these PMI indices, it’s just covering some of the level lost. It’s not forging a new growth trajectory.”
--With assistance from Keiko Ujikane in Tokyo, Shamim Adam and Michael Dwyer in Singapore, Jana Randow and Frances Robinson in Frankfurt and Scott Hamilton in London. Editors: Vince Golle, Carlos Torres
Tuesday, March 30, 2010
Posted Mar 10, 2010 09:46am EST by John Carney in Housing, China
From The Business Insider, March 10, 2010:
The latest report on the property market in China is truly frightening. Despite measures taken by authorities to reign in the price explosion in Chinese real estate, prices rose at the fastest clip in nearly two years in February.
Unless you have faith in the ability of China's central planners to perfectly negotiate a soft landing, you should be preparing for a rough crash.
From the official Chinese news agency:
China's property market grew at the fastest pace in 20 months in February, with housing prices rising at a double digit rate, despite the government's cooling-down moves, according to data released Wednesday by the National Bureau of Statistics (NBS).
Housing prices in China's 70 large and medium-sized cities increased 10.7 percent in February from a year earlier, and were up 0.9 percent compared to the previous month, said the NBS.
Prices of new homes in February rose 13 percent year on year, up 1.3 percent from January, and were mainly pushed up by soaring home prices in Hainan Province as the state government decided to build the island into an international tourist resort in December.
Haikou, capital city of Hainan, ranked first among other major cities in new home price growth, which soared 58.4 percent year on year in February. Sanya, the second largest city in Hainan, saw its new home prices up 56.1 percent.
Prices of second-hand homes climbed 8.5 percent in February from the same time last year, up 0.5 percent from the previous month, according to the NBS.
Sanya topped other cities in second-hand home prices, with a rise of 42.2 percent in February year on year, and was followed by Haikou, with a 41.7-percent-growth, according to the NBS.
The figures were announced during the annual session of the National People's Congress (NPC), the top legislature, when Chinese Premier Wen Jiabao reiterated determination to curb the excessive growth of home prices in major cities and satisfy people's basic need for housing.
China's central and local governments rolled out a series of measures to dampen the overheated property market at the end of last year, including reimposing a sales tax on homes sold within five years of their purchase and raising the down payment requirement for families buying a second house or more with bank loans.
In another move to cool the property market, the People's Bank of China, the central bank, raised the deposit reserve requirement ratio in January, and in February for the second time.
For additional coverage, see: It Begins: China Cracks Down On The Shadow Banking System That Is Inflating Its Real Estate Bubble
Thursday, March 18, 2010
Foreign Executives Say Beijing Creates Fresh Barriers; Broadsides, Patent Rules
By ANDREW BROWNE And JASON DEAN
BEIJING—Foreign businesses say their relationship with China is starting to sour, as tougher government policies and intensifying domestic competition combine to make one of the world's most important markets less friendly to multinationals.
Interviews with executives, lawyers, and consultants with long experience in China point to developments they say are making it much harder for many foreign companies to succeed. They say the changes suggest Beijing is reassessing China's long-standing emphasis on opening its economy to foreign business—epitomized by the changes it made to join the World Trade Organization in 2001—and tilting toward promoting dominant state companies.
In the latest broadside against foreigners, authorities in a wealthy province near Shanghai Tuesday assailed the quality of luxury clothing brands from the West, including Hermès, Tommy Hilfiger and Versace.
(Related article, page B2.)
Next week, the American Chamber of Commerce in China is coming out with a new survey of its members that is expected to document a downturn in sentiment.
Technology executives say they are highly concerned about government procurement rules issued late last year that would favor local suppliers who have "indigenous innovation." The rules, if implemented, could limit foreign access to tens of billions of dollars in contracts for computers, telecommunications gear, office equipment and other goods.
Patent rules imposed Feb. 1 threaten to increase costs in China for foreign innovators in industries such as pharmaceuticals, and let authorities force foreign drug companies to license production to local companies at state-set prices.
Executives in several industries say the liberalization spurred by China's WTO entry is stalling. Foreign makers of wind turbines and solar panels say they are being shut out of big renewable-energy projects.
Regulatory barriers effectively cap participation in insurance: Foreign companies had just 4.7% of China's life-insurance market as of June, and 1% of its property and casualty market, according to PricewaterhouseCoopers.
"I am pro-China and I am in favor of doing business in China, but I have some serious concerns about what has been happening in the last year,"
says Fraser Mendel, an attorney with U.S. law firm Schwabe, Williamson & Wyatt.
Chinese officials dismiss complaints that the environment for foreigners has worsened, but there are signs top leaders are noting their concerns.
Commerce Minister Chen Deming called top China executives from more than 20 multinationals to a meeting this month billed as "a chance to listen and hear issues of concern," said one participant. Mr. Chen pledged China would "resolutely continue" to open its markets, but he also criticized protectionism in the West.
On Sunday, Premier Wen Jiabao vowed China will "unswervingly implement its opening-up policy." He conceded that his "contacts with foreign investors haven't been close enough," and pledged to increase interaction.
Many foreign executives say they see an upsurge in economic nationalism, accelerated by China's world-beating performance during the recession and a new disdain for Western economic management.
"The economic crisis and downturn emboldened those who had been pushing back" against efforts to liberalize markets, says Duncan Clark, chairman of BDA, a Beijing-based consulting company.
Signs of nationalism are evident in the grooming of state-owned companies to dominate their industries as "national champions," often at the expense of private Chinese companies as well as foreign firms. From airlines to coal mining to dairy products, government policies are expanding the state's role.
A year ago, in a move foreign critics called protectionist, Chinese regulators rejected a bid by Coca-Cola Co. for China Huiyuan Juice Group Ltd., saying it could crowd out smaller companies and raise consumer prices. The two combined held just a fifth of China's juice market.
In July, four executives of Anglo-Australian mining giant Rio Tinto were detained, initially accused of stealing "state secrets," amid tense negotiations between global miners and China's steel industry over iron ore prices. Rio Tinto denies wrongdoing by the men, who await trial on reduced charges of bribery and theft of commercial secrets.
Google Inc.'s woes highlight the angst. The search company, long troubled by Chinese censorship rules, threatened Jan. 12 to depart China after it said a Chinese hacking attack penetrated its computer network.
Related attacks hit dozens of other multinationals. Google is expected soon to close its Chinese site, Google.cn., leaving local companies dominating an Internet market of 400 million users.
"The Google issue has had a crystallizing effect," says Lester Ross, managing partner in Beijing for U.S. law firm Wilmer Cutler Pickering Hale and Dorr. "It raised the consciousness of government and of the boardrooms and other stakeholders" about the difficulties of doing business in China, he says.
Foreign investors have long complained of China's haphazard legal system and regulation. These were mere annoyances when China was an emerging market. Today, the huge Chinese market is fundamental to the health of large Western multinationals. Lose here, say Western executives, and multinationals are weakened globally.
The new patent rules providing for what is called compulsory licensing aren't unique to China. But China's pharmaceuticals industry is dominated by state-owned firms, and Western lawyers worry the rules will favor them. One provision requires companies to pay Chinese employees at least 2% of profit derived from their inventions in China unless the employees explicitly waive that right.
The law "imposes significant new requirements on multinationals operating in China," says Mr. Mendel, the attorney. "You no longer have absolute control over what comes out of your R&D facility."
Executives interviewed for this article declined to comment publicly. In December, a group of 34 business organizations from North America, Europe and Asia sent a letter to three Chinese government ministers blasting the indigenous-innovation preferences for procurement as "discriminatory" against foreigners.
Beijing denies the rules are discriminatory, yet governments are taking note. "Recent events...have reminded us of the continued challenges faced by foreign and U.S. companies operating in China," U.S. Commerce Sec. Gary Locke said in a January speech. "China needs to continue making strides to be more transparent, predictable and committed to the rule of law."
Some are more upbeat. A U.S.-China Business Council poll of members last year showed 93% were "optimistic" or "somewhat optimistic" about their future in China over five years. Robert Poole, head of the council in China, says it "is really concerned about some of these policies," but "the broad themes of continued openness and reform continue to be there."
Some sectors haven't been much hindered. Car makers like Volkswagen AG and General Motors Co. benefited hugely from China's booming market last year. But state-run media have reported government plans to increase domestic brands' share to over 50% of passenger vehicles by 2015, from 44% last year.
For many multinationals in China, today's profits follow years of investment, much of it encouraged by government policies designed to lure capital. Now, at the point when their dream of access to a giant market is becoming reality, China is so prosperous that it has less need for foreign funds. Foreign investment has grown much slower than the rest of China's economy, amounting to 1.8% of gross domestic product in 2009, down from a peak of 6% in 1994.
Beijing has long harbored suspicions the West wants to hobble its economic rise. Analysts say lately, such insecurities have strengthened the hand of leaders who want to limit foreign presence in the economy.
There are backers of openness, says Mr. Ross of WilmerHale, but "there are louder voices pushing China to be more protectionist and to be more nationalist."
—Loretta Chao contributed to this article.Printed in The Wall Street Journal, page A1
Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved
Thursday, March 11, 2010
According to Chinese customs data released on Wednesday exports were up 45.7 per cent over a year earlier, the fastest growth in three years.
Imports also rose by 44.7 per cent, reflecting a recovery in Chinese domestic demand as consumers' worries over the financial crisis ease.
Chinese export data is being closely watched by analysts looking for clues as to the strength of the world's number three economy third-largest economy and for signs of recovery in crisis-hit export markets such as the US and Europe.
February's exports growth was boosted by comparison with last year's weak trade amid the global downturn and came despite the week-long Lunar New Year holiday, when many factories and offices shut down.
Overall China's global trade surplus for the January-February period narrowed by
50.3 per cent from the same time last year.
The reduction reflects a resurgence in China's demand for imports while the US and other key export markets are still struggling.
The latest data could lead China to relax its peg on the value of the yuan [AFP]
According to government figures China's economy sped up in the final quarter of 2009, growing by 10.9 percent on the strength of massive stimulus spending and bank loans.
That in turn spurred Chinese demand for imported iron ore and other materials used in stimulus-financed construction projects.
The strong export figures could make Beijing more comfortable with letting the value of the Chinese currency, the yuan, appreciate.
The value of the yuan, which has effectively been pegged to the US dollar since mid-2008, has been a source of friction with China's Western trading partners, who say Beijing is keeping it artificially low to give an unfair boost to exports.
Beijing has been under intense pressure from Washington in particular in recent months to allow the yuan to rise.
On Saturday the governor of China's central bank, Zhou Xiaochuan, said Beijing would will be "very cautious" about easing exchange-rate controls because the global economic outlook is still uncertain.
However, he added that the peg was temporary and would be removed "sooner or later" once the global recovery was on a firmer footing.
Friday, March 5, 2010
For deals to close in this environment, the gap between buyer and seller expectations needs to be bridged―allowing buyers to maintain their confidence level and protecting sellers against eroding values and retrading sales prices.
Value retention and surety of close. If value retention and surety of close were key goals of a transaction before, they are even more significant considerations for the foreseeable future.
This article takes collective input from transaction stakeholders—including strategic buyers and sellers, investment bankers, private equity groups and lenders―to check the street’s pulse about business sellers’ need to have their financial house in order when going to market.
Higher thresholds of scrutiny and diligence by buyers and lenders are now the norm. As a result, sellers can no longer go to market with less than optimal financial transparency and expect to attract a willing and able buyer and, at the same time, retain their perceived value.
Seller due diligence: Bridging the deal health gap. A key remedy to building confidence and maintaining trust is the clarity and transparency delivered through seller diligence. In seller diligence, a business owner hires a third-party due diligence firm to substantiate and prepare supporting documentation for the company’s financials before offering the company for sale. Since seller diligence teams often work on buy-side transactions, they can anticipate the buyer’s concerns. As a result, the seller’s diligence team proactively prepares the company to address requests and concerns head-on rather than being reactive to diligence issues a buyer may raise.
According to Thomas Dollhopf, principal at Marwit Capital, "Purchase-price reductions during buyer due diligence are common if inaccuracies or financial irregularities are uncovered. Sellers can eliminate the risk of this happening and greatly improve their credibility by hiring a firm to help them get prepared for all aspects of due diligence."
Other antidotes are available in the seller diligence process. Assisting the seller with data-room preparation alleviates a significant burden. Optimal tax structuring and tax diligence generally becomes a major part of the transaction diagnosis. Additionally, as transaction closings are taking significantly longer, having someone on the team who can regularly update the financial health of the company is value-added. Assistance in customizing the accounting language around earnouts, working capital and certain accounting definitions can be highly valuable. Finally, a working capital true-up is a regular deal negotiation point that can be easily addressed.
These remedies serve to increase the likelihood of a successful and timely transaction.
"Seller diligence reduces the risk of surprises surfacing in diligence," says Cuellar. "The result is increased surety of close and value retention. Companies that cannot defend their numbers get retraded, destroying value for the seller."
A senior M&A executive of a Fortune 50 company agrees: "You want the opportunity to position the issues before the buyer finds them―and they will find them," he emphasizes. "Positioning of issues becomes very important in retaining value. If issues are identified early in the process and positioned well with the buyer, it takes away the buyer’s negotiating power. Not doing this can give the buyer a reason for walking away from the deal or retrading the purchase price."
When seller diligence makes sense. Buyers often back away from a transaction when inadequately addressed red flags appear. Red flags―big or small―that are not addressed in a timely and satisfactory way create uncertainty and can cause an otherwise willing and able buyer to step away from the deal. Broken deal costs alone justify meaningful preparation by the seller.
Cuellar and Sun Capital Partners Inc. principal Matthew Garff agree that a prime candidate for seller diligence likely has at least one of the following characteristics:
Poor financial management, accounting infrastructure and financial reporting systems (many times caused by an inexperienced CFO or controller, or even a lack of one)
Lack of internal resources necessary to provide adequate attention to document preparation and to a buyer’s diligence requests; this is typically where the internal staff is stretched and only has time to focus on the day-to-day business
Closing a deal or not closing a deal may be the difference between a seller with less than optimal financial transparency and a seller with transparent financials. "It comes down to confidence in the financials," explains Cuellar.
The Fortune 50 M&A executive introduced above also encourages seller diligence in the following situations:
When multiple divisions or business units are being sold as a single asset, requiring pro forma financials, consolidation and elimination of intercompany transactions
Division or product line carve-out or spinoff
Companies that operate well, but want to keep an eye on the business and ensure no surprises come up in diligence
Businesses with complex accounting structures, systems and confusing internal jargon
"Value retention is at the heart of the issue. Clarity in the presentation of the carved-out entity is critical to optimizing value," this executive says.
Don’t misunderstand the role of an investment banker. A frequent misconception exists that an investment banker’s role is to be a one-stop shop for all financial aspects of the transaction. On the contrary, "an investment banker’s role is to position the company in the market place, help prepare a sellable forecast and develop the deepest buyer pool possible," says Cuellar. "When it comes to putting supporting details behind the numbers, an investment banker does not replace the role of an accountant."
Rob Wendell, also a principal at Marwit Capital, agrees. "A good investment banker is typically focused on presenting an opportunity to a buyer universe in the best light possible―not necessarily focused on compiling professionally prepared due diligence information like an experienced accounting due diligence firm."
When everyone’s role on the deal team is properly identified and aligned, the seller begins to realize in tangible terms―surety of close, value retention, time savings, reduced stress―the value of having the right players for the transaction.
An ounce of prevention is better than a pound of cure. Seller diligence is preventative medicine for your transaction’s health. Says Garff: "You don’t want to go down the road six to eight months with imperfections that may cause the deal to fall apart. This incurs significant costs, such as missing add-on acquisitions you could have performed, management distractions and effort, and fees paid to lawyers, accountants and others." He adds, "Seller diligence is an insurance policy against the risk that the buyer will find issues that erode value."
Marwit’s Dollhopf says, "When running a sale process, sellers need to stay focused on their core business, or they risk losing significant value. If Ebitda drops off because the seller is distracted with issues relating to the sale process that could be managed by others, the value lost [Ebitda change multiplied by the transaction multiple] may far exceed the cost of engaging a firm to perform seller diligence." He further emphasizes, "If Ebitda is already declining, the problem is compounded. Seller diligence pays for itself."
Cuellar adds, "You don’t want to pay for seller diligence in a retrade based on multiples. You want to pay for it by the hour."
Value retention: At the heart of the matter. The prevailing theme conveyed by transaction stakeholders interviewed for this article is value retention and surety of close are at risk if sellers are not well prepared for a transaction.
Each stakeholder agrees―buyers are looking for reasons to reduce price or identify issues that will cause them to walk away. With careful preparation, sellers create a defensible position to retain value and gain the buyer’s and lender’s trust, resulting in more deals getting done.
This article was written by Milton Marcotte, managing director and Dan Solomon, manager with RSM McGladrey's national Transaction Support Services practice, and originally appeared in The Deal.
Thursday, February 25, 2010
Yao has also urged that the U.S. reduce "protectionist" measures, so as to be able to increase Chinese exports.
Wednesday, February 24, 2010
GM will continue to honor warranties for current Hummer owners.
Tuesday, February 23, 2010
Markets that will supposedly have higher rates of M&A are telecommnications, food and beverages and utilities including renewable energy. Companies in slower-growing industrialized nations should see a great increase in deals.
It is likely that India and China will be among the most active countries pursuing acquistions this year.
Despite the strong growth, Taiwan is very cautious about the durability of the growth. Taiwan relies on export growth and although there is a definite high demand from China, European and US demand has become pretty weak so in respect to the EU and US, the Taiwanese government will remain cautious in regards to the nation's growth.
The $914 million profit is a great increase from the 4th quarter of 2008 when banks reported a $37.8 billion loss and overall banks earned $12.5 billion in 2009 as compared to $4.5 billion in 2008.
Unfortunately, despite the increase in profit the number on the FDIC's potential problem bank increased to 702 from 552 from the third quarter of 2009.
Friday, February 19, 2010
Thursday, February 11, 2010
Lifting such a ban would not be a simple thing to do though, as a strong resistance is already developing. Many countries are worried about China's behavior towards Taiwan and are reluctant to get involved in a potential arms race; others worry about the fact that China is still providing weapons to violent nations like Zimbabwe and Sudan, who continue to commit or support violence against civilians; more are worried that dropping the embargo would raise tensions with the United States; others feel that Europe is deluding itself to believe that China will accept them as an equal partner and probably will just continue to probe the E.U. for weaknesses that it can play up. China has long noticed problems between the E.U. nations and tried to exacerbate them, and many realize that if the E.U. can move forward it has to have a united front, otherwise China can and will best them; a dangerous proposition.
The proposal was brought up by the current Spanish presidency which lasts until July 1st. It will be interesting to see if the nations can unite on one front by then.
Friday, February 5, 2010
Manufacturing as well has been expanding, driving up the economy and its recovery, hopefully resulting in more factory jobs. It is expected that manufacturing payrolls will have dropped by 20,000 in January, which is the lowest its been since December 2007.
Tilton has noted that it will be extremely hard to convince manufacturers to stay in the United States, especially when they can go to a third world nation for much cheaper, but she adamantly tells that it can be done with a little innovation. Hopefully companies will heed her words and try to keep manufacturing in the U.S.
Thursday, February 4, 2010
Wednesday, February 3, 2010
It is an interesting place to be investing such a large sum of money into, as on the surface it doesn't seem to have all that much to offer. What the country does have though adds up to enough reason for China to take interest. Moldova sits up in the top half of nations ranked for information technology potential by the World Economic Forum; China sees that by giving loans to nations such as Moldova they gain a substancial amount of global influence, especially pertaining to Russia. By building substancial influence in the nations surrounding Russia the Chinese are able to gain leverage in negotiations with Moscow, something of great importance to the Chinese because of China's dependency on Russian oil.
China could also focus on Moldova's agriculture, wine and textile sectors. These sectors and the country's comparatively low wages have already attracted a series of European manufacturing companies. It is also highly unlikely that the nation will ever join the EU due to weak governance.
It appears that China could gain from investing heavily in this tiny nation.
Tuesday, February 2, 2010
The deal is subject to the approval of the Nigerian government.
Friday, January 29, 2010
Retailers have reported good December sales gains, suggesting the beginnings of a sales comeback. Overall the industry turned in a 2.9% sales increase from 2008 and 75% of retailers beat analysts' estimates, the highest percentages of companies to do so since March 2007.
The holiday results are amongest some of the latest signs that the economy, while still a long way from pre-recession levels, has turned a corner.
Wednesday, January 27, 2010
In terms of the United States, Kotkin tells that the country's fertility rates remain the highest of advanced nations and that continued immigration will allow for a 100 million population increase by 2050. According to those calculations only 1/5th of the population will be over 65 by then so it will not be too hard of a problem to offset the burden of the aging population.
Approximately 1/3 of China's population, on the other hand, will be over 60 by 2050. Kotkin claims that China's lack of democracy, cultural homogeneity, historic insularity and the rapid aging of its population that will start in the 2020s will combat any global preeminence.
This could all be good news; however, although success of nations in terms of an aging population may mean that the United States will maintain global dominance I find this overall theory hard to believe. There may always be technological advances but I don't think that a 100 million person population increase will be highly beneficial to the United States as it will put a huge strain on natural resources, making disease and competition for resources more prevalent. But who is to say who is right and wrong just yet?
Monday, January 25, 2010
Friday, January 22, 2010
Calculations show that China has narrowed the trade gap to $4.909 trillion but has yet to supersede Japan's $5.126 trillion.
During the 4th quarter of 2009 China's GDP expanded 10.7% from a year earlier.
Although there remains the risk that third parties will challenge the EU decision the deal has already received the U.S. Department of Justice's approval. China and Russia are still left to grant approval for the deal.
Secretary of State Hillary Clinton has essentially put American internet companies on notice in their dealings with China. Clinton has stated that she hopes U.S. companies will follow Google's lead, putting an end to the censorship of the internet.
Although she did not outright propose regulations the stronge urgings for this type of action and her praise of the Global Network Initiative, a consortium of companies and organizations that is designed to provide guidelines for operating in countries with authoritarian governments founded by Google, Microsoft and Yahoo; tells enough of how the U.S. government may react to companies that do not comply with her urgings.
This of course leads to a dilmenia for the U.S. based companies as voluntarily adhering to Clinton's standards will require corporations to do decrease revenue, increase costs, and reduce profits. In the case of China, this could mean a lot of profits as China already has the most internet users in the world, despite the fact that only 25% of the population are online and are thus a huge source of potential growth; however, not complying with Clinton's standards could lead to less government contracting and possible future taxes.
Though I doubt that many companies will be detracted from doing work in such a large market it will be interesting to see how companies will react.
The figures suggest that China is also growing much faster than previously expected; the country is poised to overtake Japan as the second largest economy. There however is fear about the bursting of Chinese asset bubbles and the negative effects of the nation's stimulus packages.
Thursday, January 21, 2010
Secretary of State Clinton has now stated that those who carry out cyber attacks should face consequences and condemnation as "an attack on one nation's networks can be an attack on all". This statement is likely to lead to a build up of tension.
Tuesday, January 19, 2010
After 4 months of struggle on the part of Cadbury's board, the company recommended that shareholders accept the deal that would amount to $13.78 a share.
Thursday, January 14, 2010
Unemployment claims also rose from 11,000 to 444,000 last week; analysts had believed that only 437,000 claims were going to be filed.
Monday, January 11, 2010
We will see over time if the involved countries choose to follow up on this, but knowing that North Korea is interested in developing a peace treaty is definitely a step in the right direction.
FEMSA will now have a 20% share in Heineken's boardroom.
Friday, January 8, 2010
During the first 10 months of 2009 China exported $957 billion worth of goods while Germany exported $917 billion. It is expected that November and December's numbers will not change China's position. Numbers for all of 2009 are expected shortly.
Recently the Chinese government have either blocked access to or shut down 700 plus websites in addition to the tens of thousands of already blocked sites. Freedom of speech violations is one thing, but in blocking many of these sites including Google, YouTube and Twitter, China is damaging foreign commerce and trade. China is also preventing the use of mobile applications which is/was a $29 million industry there and should be a steadily growing industry, blocking even its own innovation.
With 300 million people using the internet in China, China has become almost irresistible to foreign tech companies, however as China only allows access to companies that they deem as being politically reliable this cuts off a lot of international business. If China doesn't change its policies and allow more businesses to penetrate its firewall, they very likely could have a WTO dispute on their hands.
In 2002 clean tech firms only received $0.9 billion.
Wednesday, January 6, 2010
There, however, was a combined revenue of $94 billion this year for the 4 firms. The Americas represented 40% of global revenues; Europe, the Middle East and Africa represented 45% and Asia Pacific represented 15%. Auditing accounted for nearly 50% of the revenues.
Tuesday, January 5, 2010
Asia, however did relatively well considering. Asian (excluding Japan) volumes climbed 9% to $493.1 billion. Japan-targeted M&A activity fell 4% to US$142.2 billion, with 92% of volume generated by domestic deals.
Monday, January 4, 2010
According to Sanford C. Bernstein, there also exists the possibility that mergers will rise 35 percent in 2010 and 23 percent in 2011. The forecast is based on an analysis using data since 1980 that incorporates growth in GDP, corporate earnings and commercial loan volume. These figures have about a 72 percent correlation to takeovers.
China also believes that, despite the global recession, their economy grew at least 8% in 2009 and will do so again in 2010. Given that China's GDP at the end of 2008 was approximately $4.6 trillion and that Japan's GDP is continuing to shrink it should be expected that China's economy will quickly overcome Japan's.