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The Viewi

Daily analysis of the major talking points in the worlds of business and investing with a focus on implications for doing both in mainland China and its key financing hub - Hong Kong.

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  • Office markets in Asia are performing well and the shift to hybrid working has had less of an impact, yet investment in the sector has fallen sharply
  • Asia’s office markets need a stronger narrative, one that differentiates the sector more clearly from its counterparts in the US and Europe

Beijing has shown no urgency at its NPC meeting to reboot or stimulate its economy in a way that would support its target, dashing the hopes of its neighbours worried about the drag from an economic giant fighting decline.

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The end of more than a decade of cooling measures for Hong Kong’s property market is welcome and has sparked a surge in new home sales. These changes must be put in proper context, though, as several other factors will be more consequential in setting the property sector’s course.

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Efforts to keep Chinese electric vehicles out of the US will only hurt American consumers and manufacturers in the long run. Instead, the Biden administration should welcome Chinese carmakers into the US to improve innovation and competitiveness.

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The surge in Japan’s stock market looks out of place and unsustainable in an economy with a shrinking population and falling real wages. Chinese investors shifting money to Japan in the hope of catching the wave should be wary of being left behind when this bubble pops – possibly this year.

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Deteriorating affordability has left many Australians struggling in the housing market, but foreign buyers’ interest remains strong. Record migration, China’s housing crisis, Australia’s stability and Asian private wealth’s influence are driving the surge.

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To better understand the current conditions driving record stock prices across the globe, investors would do well to learn the lessons of history and look back at the situation in Germany after the fall of the Berlin Wall.

Hong Kong has made a modest contribution to the global climate fight by developing two simple tools SMEs can use to track their carbon emissions. The city has the potential to be a leader in the new corporate governance system in the climate change era.

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Given the bleak domestic and external backdrop, the strong performance of China’s commercial real estate investment market is remarkable. It shows that a solid domestic investor base, a sharper repricing of property values and policy support for key sectors can make a difference.

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The middle class has long been seen as the core of China’s future prosperity, but a depressed stock market and home values are sapping their confidence. The nation is at a critical juncture when effective reforms are needed to channel the energy of the middle class into driving economic recovery.

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The Japanese economy is a study in contrasts, with a roaring stock market and record corporate profits set against stagnant wages and shrinking GDP. Decades of prioritising a weak yen over structural reform have deadened Japan’s animal spirits and hurt its attractiveness as an investment destination.

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Compared to markets in the US and Europe, both prices and rental yields have been slow to adjust. As a result, affordability has taken a hit and investors are thinking twice. Yet Asia’s strong underlying fundamentals are undoubtedly an asset.

Donald Trump’s pledge of expanded, ‘eye for an eye’ tariffs if he wins the presidency threatens a return to an era of depressed trade and growth. US firms, importers and allies should prepare for the effects of Trump’s possible re-election.

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From pensions to medical care, China’s rural-urban divide must be urgently addressed. Or just about everyone outside the rich middle class will be left out of the silver economy.

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Given high borrowing costs, cooling measures and a surge in private home completions, it would be astonishing if Singapore did not see a slowdown. While the property sector is losing momentum, it is the kind of slowdown landlords and investors in most other markets would envy.

As a developing country, China does not have to give directly to UN climate funds, such as the loss and damage fund. This has fuelled a debate over outdated categories.

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Shares on the Hong Kong bourse offer excellent value and the market will receive unstinting support from Beijing. While the US and European markets are outperforming Hong Kong’s now, their ability to keep inflation down relies on the weakness of China’s post-Covid economy.

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Domestic developments such as rising wages and stricter environmental regulations in addition to geopolitical factors have pushed Chinese companies to shift their operations either within the country or overseas. This ability to adapt quickly to changing conditions will help Chinese firms to survive a challenging environment.

India’s growing middle class, the right government support and a favourable external environment have given the property sector wings to escape the headwinds buffeting markets elsewhere.

Lessons from the G20’s failed attempts at restructuring sovereign debt must be learned. Why not explore debt-for-development swaps, where loans are in effect turned into investments, and market-based alternatives such as packaging the debt into securities?

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The emerging sector of multifamily properties is offering many untapped opportunities – especially in China, where catalysts for the institutionalisation of its rental housing market have coalesced in recent years.

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With Chinese lending to Africa shrinking, the continent must find ways to support its own development. It could do so by increasing internal trade, diversifying tradeable goods away from commodities and developing its relationship with the US.

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The earthquake and plane collision earlier this month are unlikely to deter travellers as Japan continues to welcome record levels of tourists. The tourism rebound has aided the investment appeal of Japanese hotels, but so have loose monetary policy and a large domestic tourism market.

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A full transition to a rules-based society will help Beijing restore the confidence of businesses and citizens in its ability to weather the economic storm. To root out corruption, China must put its faith in institutions with accountability, not endless anti-corruption campaigns.

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The big worries in Asian real estate from 2023 will persist this year, but sources of resilience and strength will also endure. Trends meriting close attention include Australia’s housing market, Chinese property beyond housing, an Indian real estate boom and retail property strength.

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After widespread expectations of a global recession last year fell flat, investors should take note of current narratives to spot potential shocks for 2024. Candidates include assumptions of interest rate cuts, a steady economic recovery in China, a debt implosion, an end to war and Trump’s re-election.

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Elections in India, Indonesia, Taiwan, the US and elsewhere have the potential to reshape global markets depending on who emerges victorious. Local asset markets could be more volatile ahead of the votes and perform more constructively once there is higher certainty about the future policy outlook.

Despite rising US real yields, the gold market remained resilient in 2023 due to record central bank gold purchases, increased market volatility and geopolitical turmoil. If investor sentiment towards gold ETFs improves, it could be a powerful tailwind that drives gold prices higher this year.

Its 2024 economic strategy blends ambition and caution, aiming for growth and stability amid uncertainty. The effectiveness of its policies and global dynamics will be critical

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While most companies persist with the annual performance-linked bonus, some have offered incentives linked to exercise or body mass index. However, a better work environment and training, more respect, a recognition of employees’ efforts and revenue-sharing models can be as empowering as cold, hard cash.

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