Financial Times Selling to Nikkei

Pearson is selling the Financial Times to the Japanese media group Nikkei for £844m in cash. The British company will hold onto FT Group’s 50pc stake in the Economist. It will also keep its building on the south bank of the Thames.

As Pearson’s chief executive, John Fallen, said, “Pearson has been a proud proprietor of the FT for nearly 60 years.

“But we’ve reached an inflection point in media, driven by the explosive growth of mobile and social. In this new environment, the best way to ensure the FT’s journalistic and commercial success is for it to be part of a global, digital news company.”

Read the whole story and more on the agreement.

China Real Estate Picking Up…But Only in Larger Cities

China’s metropolitan areas have witnessed a financial and property revival while the recovery in smaller cities has been much slower. The home sales volume in tier-1 cities surged 42.9% in teh first half of this year from last year. For tier-2 cities the uptick was 16.9% and for tier-3 cities there was a fall of 2.9%.

The recovery for the housing market in tier-3 and tier-4 cities is weighted down by high inventories, according to Zhang Dawei, chief analyst at Centaline.

China reduced the down payment levels for second-home buyers in March. It is now 40%, rather than the 60-70% that was previously required. They also exempted business tax for sales of homes that are purchased over two years ago.

Read the whole article to see more of the nuance of the issue.

Hong Kong Approves Government Spending for City Crossing

Hong Kong lawmakers have approved for the government to spend HK$17.5 billion to construct the city’s 7th crossing to Shenzhen. They discussed the idea for three weeks before coming to their current conclusion. This money will be put with the already approved HK$16.25 billion that was approved in July 2012.

Legco’s Finance Committee backed the funding after the 26-10 approval. Learn more about the process and the conflicts that arose around it.

Japan Announces $100 Billion Plan

Japan is set to announce a $100 billion plan to invest in roads, bridges, railways and other building projects in Asia. Prime Minister Shinzo Abe is set to unveil a five-year public-private partnership.

As Jiji Press reported, “The envisioned assistance is aimed at demonstrating Japan’s stance to contribute to building up high-quality infrastructure in Asia through human resource development and technological transfers and showing the difference from the AIIB, so that Japan can keep a high profile in the region.” Learn more with the full article.

Apple Sales up in China

For the first time Apple sold more iPhones in China than the United States. Apple’s iPhone sales in China skyrocketed recently, increasing the revenue in China by 71% to $16.8 billion. This was certainly helped by the upcoming Chinese New Year. Chief Executive Tim Cook also says that it’s a result of China’s expanding middle class.

In the last quarter, Apple sold a total of 61.2 million iPhones, up 40% from the year-ago quarter. It sold 12.6 million iPads, which is actually down 23% from a year ago.

As FBR Capital Markets analyst Daniel Ives said, “A 60 million-plus iPhone number is a home run and will be cheered by the Street as this remains the bread and butter of Apple.”

Read the article to get all the details.

Advice from Crescent Petroleum CEO in the Post-Saddam Hussein World

At the World Economic Forum in January, Majid Jafar, the CEO of Crescent Petroleum, called for leaders at the Annual Meeting of the World Economic Forum in Davos to place the economic stability high on their list of priorities.

Majid Jafar said, “The Arab Spring has now clearly turned into a winter of discontent. In parallel with all the political efforts, we need quick and urgent economic action to address the issue of high youth unemployment in the Middle East and North Africa (MENA) Region. Insufficient economic growth in the region has led to massive youth unemployment, in some areas more than 60%. This is turning into a demographic time-bomb. The recent fall in the oil price is also a warning that the region cannot be over-reliant on energy resources for GDP growth. We must create long-term sustainable economic growth. Employing our youth is the key to unlocking our true natural resource. We cannot achieve political stability without economic stability.”

One scheme Jafar suggests could address the issues around youth unemployment is the  Arab Stabilization Plan (ASP). This is a policy initiative for the region that would promote infrastructure investment and create jobs. The proposal, which takes its inspiration from the US-led Marshall Plan that was used to rebuild post-war Europe. The plan would prioritize infrastructure projects on a national level and would help with the economy in countries like Egypt, Jordan, Yemen, Tunisia and Iraq where, more than seven years after the Saddam Hussein was removed, the country’s infrastructure remains in tatters.

Majid Jafar explained that “The MENA Region is currently going through changes that are unprecedented in the last century. In many cases the region has failed to build national identities let alone a regional one, failed to build inclusive and stable institutions, and above all failed to build private-sector driven competitive economies. There is capital, but the region needs a focused multinational effort to create regional trust and direct it into long-term infrastructure investments. This will create employment and sustain economic competitiveness.”

Uber Moves Into Chinese Market

Uber has recently struck a deal with China Yongda Automobiles Services Holdings. This is a Chinese luxury auto dealer. Together, they plan to provide discounts and financing for drivers of Uber cars. Yongda will provide Uber’s partners with discounts on new car purchases, financing and after-sale services.

Uber has faced a great deal of pressure in its attempts to expand into the Chinese market. Time will tell how they do trying to squeeze into the market. To read more about this ventu, see the full article.

India’s New Budget for the Coming Year

Indian Prime Minister Narendra Modi and his government unveiled their first full-year budget this week. They have planned a major increase in public spending on infrastructure and a lower corporate tax rate. There will also be a new welfare program for the poor and more relaxed plans for fixing the fiscal deficit.

The government is predicting a growth rate of 7.4% in this fiscal year.

Mr. Jaitley started out his speech saying, “The credibility of the Indian economy has been re-established. The world is predicting that it is India’s chance to fly.” He continued by saying “We have to think in terms of a quantum jump.”

Some found the budget’s focus on welfare to be a surprise. As Jayshree Sengupta, a senior fellow at the Observer Research Foundation, said “You know, I had expected it to be a very pro-business, pro-rich budget, and I was really surprised by how much he has given to the rural employment scheme.”

Read more details about the budget and the reaction from many.

 

Marketing Researcher Repucom Spotlights Asia Sports Investments

A recent report released by sports marketing research company Repucom on Monday shows the trend of investment in sports sponsorship from the Asia into US sports franchises.

The report was entitled “Emerging Giants” and explains that, in the last two years, Asian businessmen have invested approximately $1.1 billion in US sports franchises.

South Korea will host the 2018 Winter Olympics and the 2022 World Cup will then be staged in Qatar. The report explains that, as long as the economies in the Middle East and Asia remain strong there is no reason to assume that their investments in sports will slow down.

Read the whole article to gain more depth about this interesting economic change.

India Investments

by Robert Lavinsky
by Robert Lavinsky

SITA (Supporting India’s Trade Preferences for India)’s goal is to increase exports in Ethiopia, Kenya, Rwanda, Uganda and the United Republic of Tanzania. The organization’s focus is on the following sectors: pulses; edible and essential oils; spices; business process outsourcing and information technology-enabled services; coffee; cotton, textiles and apparel; and leather. Given that all the countries listed above (except Kenya) are given special access to the Indian market (under the preferential tariff treatment New Delhi accords), such investment is becoming increasingly popular.

According to SITA’s recent workshop participants, it is private sector based development – supported by Indian business investors – that will be the driving force of more trade between East Africa and India. There will also be an attempt to increase the value of East African products by getting more Indian-based investment opportunities.

Moving across to China, a substantial shift in its cohesion with India from trade to investment needs to happen. This is because, according to General Didar Singh, Ficci Secretary, it is only with an escalation in investments that the issue of trade imbalance can be addressed between China and India.

He explained: “Our trade with China is doing fine. There are some imbalances in the bilateral trade, but in the global context that does not mean much. The real important question is how open we are about our investments.” Indeed, the total trade amount between India and China in 2013 was $65.50 billion. However, the trade surplus was “heavily tilted in China’s favor.”

Vis-à-vis Tanzania, trade with India has been growing at an impressive rate. The only negative of that is that it has been in favor of India, which did not aid Tanzania’s manufacturing sector much. For example, even though tanzanite is mined in Tanzania, it seems that India is the largest exporter of the gem. In addition, Tanzania’s deficit remains “huge.”

So it seems that India is doing well but needs to assist its Asian neighbors in trade and deficit for the east to continue to thrive.