Yen Tan

"Finance minister Lan Foan delivered the proposal – an increase to the local government debt quota that would then be used to convert implicit liabilities – to the National People’s Congress (NPC) Standing Committee, the official Xinhua News Agency reported." This has already been announced - so why is this a 'stimulus signal'? The debt swap has been planned - and they are determining rollouts, scale, criteria and what happens when there is abuse of the system. Also the debt swap is for short-term debt to be swapped for long term debt ... which still makes the provinces as indebted; and WHO is going to foot the arbitrage? Also this move will make the provinces - on paper- even more indebted by revealing more hidden debt that should have been declared. (The State Council thinks there is more hidden debt - but they do not know how much more; I think they do not really want to know - because to know is own the problem.)

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On Radio 3 RTHK "Money Talk" today with host Nitin Dialdas, I discussed a "View from #Taiwan" including Taiwan on US' currency manipulation watch list, #TSMC market cap, demand for large real estate plots in Taiwan to accommodate AI servers, European subsidy for #GlobalWafers, and #Starlux Airlines adds #HongKong flights, several tech companies announce new investments in Taiwan. https://lnkd.in/gfuhvQre

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What do you think will shape geopolitics in 2025? Plutocracy, Kakistocracy, Anocracy or something else? This APAC news outlet concludes we are indeed living in “hard-to-decipher times”. https://lnkd.in/gAtCB2zw #publicpolicy #governmentrelations #geopolitics #publicaffairs #asiapacific #politicsmatters

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04-November-2024, Volume 1, Issue 108 (Asia) OPEC caught us on the blindside with its extension of voluntary cuts, kicking the oil can down the road to at least the end of December. They’ve entrenched themselves in defence of the $70 line, declaring: “No pasarán!” Or is it the $75.00 line? 😅 And the markets liked it, with flat price opening around $1.40/bbl up from Friday’s close. OPEC must have enjoyed October’s increased oil prices, pumped up by geopolitical anxieties, and decided it wanted to keep them there. A similar announcement in September provoked little price reaction, as most market participants expected the cuts to be extended, but were more divided for the progression of OPEC’s supply this time. Crucially, in September, they announced a 2 month extension - this time it’s 1 month. Members’ patience is thin; they want to sell crude and they need money! #Derivatives #OOTT

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**Lessons from "Culinary Class War": Insights for Entrepreneurs** Have you watched the captivating drama of *Culinary Class War* on Netflix? Cooking shows have a unique allure, immersing us in a world of flavors, competition, and creativity. Beyond the tantalizing dishes, there are valuable lessons for entrepreneurs and businesses. In both the culinary arena and the business world, one truth stands out: life is seldom fair. Navigating class distinctions and stringent requirements is a reality we must confront. While we can strive to outmaneuver obstacles, they remain constants in our journeys. A pivotal challenge in the show revolves around a restaurant setup, with success determined by sales figures. This highlights the importance of a robust business model supported by data-driven insights. Success isn’t just about skill; it’s about strategic decision-making informed by analytics and market trends. Central to triumph is cultivating the right mindset. The chefs exemplify unwavering dedication, often working grueling hours. The path to success requires resilience, perseverance, and a steadfast resolve to overcome challenges. Innovation is another cornerstone of success. Contestants face challenges that push them to create unique dishes from a limited set of ingredients, showcasing creativity and resourcefulness. Are you ready to turn limitations into opportunities? Finally, a genuine passion for your craft is essential. The chefs who thrive are driven by a deep love for their art, not just the pursuit of victory. Without this passion, the daily grind can quickly become a chore. As we enjoy the drama of *Culinary Class War*, let’s also embrace the insights it offers. Face challenges head-on, strengthen your resolve, foster innovation, and nurture your passion. In the kitchen of life, these principles are the essential ingredients for a recipe of success and fulfillment. #CulinaryClassWar #Entrepreneurship #BusinessInsights #Innovation #Passion #Resilience

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Coming up next in our suite of anti-scam measures - Lowering the maximum Daily Withdrawal Limit to help curb potential losses https://lnkd.in/gm96N8Nu

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“Washington and Beijing need to have a relationship of ‘managed strategic competition’ in order to maintain continued economic prosperity, Kevin Rudd, former Australian prime minister and current ambassador to the U.S., said at a recent forum in Singapore. Such a relationship involves guardrails and more open lines of communication between the militaries of the two countries and political establishments, which could help ‘reduce the risk of crisis, conflict, and war by accident,’ Rudd said at Caixin’s Asia New Vision Forum2024 on Wednesday. Rudd noted the importance of stability for regional economic growth, attributing the largely peaceful environment in East Asia in the past half century a ‘precondition for a longstanding prosperity’ in the region.” “Rudd, who took up the post in Washington in March 2023, previously served twice as Australia’s prime minister. He was also the country’s foreign minister from 2010 to 2012. Rudd studied Chinese in college and founded the Asia Society Policy Institute’s Center for China Analysis in 2022. As China-U.S. tensions continue to rise, Rudd stated that Australia’s approach to its relations with the world’s two largest economies is pursuing an ‘open and expansive’ economic relationship with China, while maintaining solidarity with the U.S on issues of defense, security and foreign policy. ‘We are perfectly capable of walking and chewing gum at the same time,’ Rudd said. ‘We’ve done so, in fact, for the better part of half a century.’” “As for Australia-China ties, which have been on the mend following years of fraught relations under the previous government in Canberra, Rudd said it is now ‘much more stable and normal,’ commending Beijing’s recent removal of tariffs on Australian products like wine and barley. The removals came after Australian Prime Minister Anthony Albanese made a state visit to China in November, when he met with President Xi Jinping. The two sides agreed to resume a series of high-level talks. In June, Chinese Premier Li Qiang visited Australia. At the same time, Rudd noted the differences in foreign security policies between Beijing and Canberra, urging efforts to accept the fact that the two sides have different perspectives, while continuing to invest in people-to-people exchanges.”

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An interesting article that I will share below highlighting the limitations of the USA's system of capitalism vs the positives of China's own version of capitalism. Before you think this is just another of my "USA bad - China good" pieces, give some thought to this: The US system gives rise to spectacularly successful companies that completely dominate their industries and enjoy massive profitability and growth because of that. Who benefits? The egregiously wealthy owners and elite shareholders. The 1%. The consumers, the 99%, are punished with limited, expensive products and services with few options of cheaper or better alternatives. The "magnificent 7" are a prime example. China, on the other hand, forces competition and consistently ensures no single companies dominate. The result is a plethora of cheaper, better products and services constantly being innovated and delivered. The 99% are the beneficiaries. Whilst the numbers of billionaires and millionaires grow in China, the system drives diversity, growth and innovation. America could learn a lot from China, but instead it pillories it out of economic fear and protection of their oligarchs. The stagnation of innovation in the USA due to lack of competition, the fervour for profits, all cause the country as a whole to become less competitive. As an outsider, I find it a fascinating watch! The article is far more articulate and detailed and I apologize for having stolen its gist but here you are:

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Have you heard of Audrey Tang? Tang transitioned from a demonstrator against the Taiwanese government to eventually become its first ever minister for digital affairs. I’ve been following Tang for the past few months, and what fascinates me is Taiwan's approach to decentralising the consultation process in the digital policy environment, which Tang has overseen. In 2014, Taiwan launched vTaiwan, an open consultation process that combines online and offline interactions for citizen and government engagement on national issues. It promotes People-Public-Private Partnerships (PPPP) by bringing together government officials, experts, business leaders, and civil society to create digital legislation. Central to vTaiwan is Polis, a real-time online system that collects and maps consensus among participants. Notably, Polis lacks a reply button, reducing trivial exchanges and trolling, which encourages constructive idea-sharing and narrows divides. While Taiwan may not be the most obvious choice for a groundbreaking exercise in democracy, vTaiwan represents a promising experiment in participatory governance and decision making. Audrey Tang also recently visited Australia to speak at the National Press Club of Australia and to launch a new book titled ‘Plurality: The Future of Collaborative Technology and Democracy.’ 🤔 This has got me thinking about how we can improve consultation processes here in Australia, particularly in areas such as development applications and objections, public policy development, and major infrastructure projects. We have to find a way to get past the battles on the margins, engage the masses in the conversation, and find new and more effective ways of delivering consultation and gaining valuable feedback. If you haven’t heard of it, check out vTaiwan at: https://info.vtaiwan.tw #Democracy #ReThinking #Consultation #CommunityEngagement #Taiwan

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My latest for East Asia Forum is below (also syndicated to AFR Opinion here https://lnkd.in/gpaGSf6Q). Here I attempt to provide a slightly different perspective on China’s short run economic prospects, by drawing parallels between the current circumstances and prior deflationary episodes over the last 30 years. The general framework is built around balance sheet problems and their resolution. The key insight from the historical analysis is that boldness is required to break the deflationary circuit, and passivity is a dangerous approach. What would boldness entail? 1. An unapologetically expansionary fiscal policy, aimed directly at households. 2. A concrete reform of vertical fiscal imbalance, complemented by a deus ex machina transfer of liabilities from the periphery of the public sector balance sheet to the Centre. 3. Letting the exchange rate find its own level. When your price level is falling, your currency is too strong. Shiro Armstrong James Laurenceson Paul Burke Frank Jotzo Patrick D'Arcy Adam McKissack Lee Levkowitz Wenjun Bao Chen Chen Saul Eslake

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“China has announced a Rmb10tn ($1.4tn) fiscal package to bail out local governments and help shore up its faltering economy, as it braces for increased trade tensions with the US under Donald Trump. The long-awaited fiscal plan is one of the biggest to target the country’s troubled local authorities. The measures announced on Friday by the National People’s Congress follow a monetary stimulus package released in September that was Beijing’s biggest since the coronavirus pandemic. As part of the bailout, Beijing would authorise local governments to issue bonds over three to five years to restructure most of an estimated Rmb14tn in ‘hidden’ or ‘implicit’ debts, finance minister Lan Fo’an said in a rare press briefing at the Great Hall of the People in Beijing. These debts are mostly held by thousands of off-balance sheet finance vehicles that local governments used to invest in infrastructure and property-related sectors.” “Many of these bets went sour when China’s real estate market entered a deep slowdown three years ago, sinking local government finances and undermining the broader economy. China’s renminbi was down 0.3 per cent at less than Rmb7.16 to the dollar on Friday afternoon. The country’s central bank on Thursday set its daily fix for the currency at its lowest level in a year, at Rmb7.166, as the dollar surged following Trump’s victory. Lan estimated that ‘hidden debts’ would be reduced to Rmb2.3tn once the swaps and another debt programme related to slum redevelopment were in place. On additional stimulus measures, Lan said officials were ‘studying’ extra steps to recapitalise big banks, buy unfinished properties and strengthen consumption. ‘We are planning the next phase of fiscal policy and are intensifying countercyclical adjustments,’ the finance minister said. But analysts say China needs to urgently deal with other problems dogging its domestic economy, including the housing slump.” “This before a 60 per cent increase in tariffs threatened by Trump during the US election hit its exports. If fully implemented without Chinese countermeasures, the Trump tariffs could knock several percentage points off China’s GDP at a moment when the economy was highly vulnerable, analysts said. Larry Hu, economist at Macquarie, said the announcement ‘may be disappointing for those who were expecting the NPC meeting to approve a massive fiscal package’. But the expectation is unrealistic, because the policy goal is to achieve the GDP growth target and reduce tail risks, not to reflate the economy in any meaningful way,’ he said. Beijing’s stimulus efforts became more urgent in September after it became clear that third-quarter GDP growth was set to miss the official annual target of 5 per cent. The US-listed shares of China’s largest companies were trading down in the pre-market session in New York. Commodities including Brent crude and iron ore declined on Friday.”

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My latest with Zhuowen Li on the shrinking FDI inflows in China - According to China's balance of payment data, net FDI inflows in the first half of 2024 turned negative, suggesting foreign firms might have repatriated more earnings back home than adding to new investments in China. This continuous decline in FDI inflows is driven by multiple factors, including geopolitics, divergence in monetary policy paths between China and most other major economies, China's gloomy outlook, and perhaps also the authorities' growing obsession with security. What is making things worse is the authorities' ongoing crackdown on access to Chinese data, which is making it more difficult for investors, both domestic and foreign, to make decisions. Will China's new (and coming) stimulus measures be enough to convince foreign investors to return? https://lnkd.in/ege_ruvz

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Can investors capture the China opportunity ex-China? Jian Huang and Edward Blenk will analyze the risks and potential wins at this Hong Kong Venture Capital and Private Equity Association (HKVCA) session next week.

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