The Wall Street Journal - Thursday, Literatura, Gazety, Magazyny
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BUSINESS & FINANCE
Page 17
OPINION:
China Can’t
Aord Its
Japan Bashing
Page 12
ASIA EDITION
VOL. XXXVII NO. 19
(India facsimile Vol. 4 No. 80)
THURSDAY, SEPTEMBER 27, 2012
WSJ.com
Uncertainty
On Bailouts
Roils Europe
Spat Tests
Japanese
Brands’
Cushion
China’s tough stance
against Japan in a continuing
territorial dispute may have
no bigger backer than Yao Xin,
a 23-year-old legal assistant
who says she refuses to buy
Japanese products. “This is a
very big government issue,
and I will stand by the govern-
ment,” she said.
B
Y
T
OMMY
S
TUBBINGTON
A
ND
N
INA
B
AINS
tional Monetary Fund and the
European Union.
European stocks retreated
sharply and the euro sank to a
two-week low against the dol-
lar, while Spanish government
bond yields surged through
key levels.
Spain’s 10-year govern-
ment bond yield surged 0.33
percentage point to 6.03%,
while the euro fetched
$1.2850 from $1.2896 late
Tuesday in New York, or
down 0.4%. The euro was at
its lowest since a German
court ruled favorably on the
European Stability Mechanism
earlier this month.
The selloff in European eq-
uity markets was more pro-
nounced in the euro zone’s ec-
onomically fragile regions as
Spain’s benchmark IBEX-35
index lost 3.9% and Italy’s
FTSE Mib retreated 3.3%.
Banks in the region saw
their shares drop more
sharply, with
BNP Paribas
tanking 5.5%,
UniCredit
sink-
ing 5% and
Banco Bilbao Viz-
caya Argentaria
losing 4.8%.
European financial mar-
kets were hammered Wednes-
day amid more signs of pro-
tests against severe austerity
plans imposed by the govern-
ments of Spain and Greece.
Madrid’s prospects of
avoiding a government bail-
out appeared to recede signif-
icantly on Wednesday, as its
borrowing costs climbed,
stock markets sank and the
euro fell.
The financial-market re-
treat came on the back of
fears that Spain, whose gov-
ernment is rolling out a new
economic program Thursday,
might delay a bailout request
too long and that it would not
be able to shift the burden of
a bank bailout to the region’s
bailout fund.
In Athens, police battled
with rioters protesting the
government’s plans to impose
still more spending cuts to
comply with fiscal bailout
conditions set by the Interna-
Laurie Burkitt
By
in
Beijing and
Juro
Osawa
in Hong Kong
Ms. Yao made her vow
while standing in a Uniqlo
store, a retailer owned by Ja-
pan’s
Fast Retailing
Co., in
Beijing’s Japanese-themed
Ginza shopping mall. In-
formed that the blue-collared
shirt she was fingering was
being sold by a Japanese com-
pany, she said, “Oh, I didn’t
know.” Fast Retailing on
Wednesday
A riot police officer stands in front of burning firebombs during protests Wednesday in Athens
The uncertainty came after
Spanish Prime Minister Mari-
ano Rajoy told The Wall
Street Journal in an interview
Tuesday that he would need
to determine whether the
conditions attached to the
bailout were “reasonable” be-
fore asking for one.
The finance ministers of
Germany, the Netherlands and
Finland called into question
the use of euro-zone bailout
funds to directly recapitalize
banks, heaping more pressure
on financial markets.
“[Spain and Greece] are a
reminder that all the Euro-
pean Central Bank’s money
won’t make recession go
away,” said Kit Juckes, Global
Head of Forex Strategy at So-
ciete Generale.
“Until a growth strategy is
implemented by Europe’s pol-
iticians, this crisis can’t be
brought to a satisfactory
end,” Mr. Juckes added.
The nervous tone spread
across Europe, with the U.K.’s
FTSE 100 index losing 1.6%,
Germany’s DAX slumping 2%
and France’s CAC-40 sinking
2.8%.
Pressure continued to
mount on Spain to seek finan-
cial assistance in the face of
rising borrowing costs, while
the Bank of Spain said eco-
nomic activity continued to
fall in the third quarter.
This ups the ante on the
Spanish government to find
ways to meet its stringent
budget-deficit targets.
Please turn to page 16
renewed
its
pledge to expand in China.
Ms. Yao illustrates the
complexities behind a nearly
four-decade commercial rela-
Please turn to page 16
Athens protests against
austerity turn violent.............. 6
German economy maintains
dominance..................................... 6
Heard on the Street: Dispute
hits Japanese car makers.. 32
Factory Riot Spotlights
Breaking Point in China
Inside
B
Y
P
AUL
M
OZUR
China’s vaunted manufactur-
ing machine. And it poses a
challenge to the government
that is struggling to satisfy
the soaring expectations of a
new generation of Chinese
workers who came of age in
an era of double-digit eco-
nomic growth and are less
willing than their parents to
make personal sacrifices for
their country.
Dozens of workers ques-
tioned on Wednesday said the
rioting on Sunday, which
caused 40 injuries and led to
the mobilization of some
5,000 police, was in part the
result of growing tensions as
guards severely enforced
strict rules on the campus.
One worker said a drunken
fight between two workers
sparked a violent attack from
a number of security guards
seeking to control the situa-
tion. The scene of the guards
beating the workers led their
friends to call others for help,
and before long a full-blown
confrontation between guards
and workers had broken out.
Hon Hai’s Foxconn arm,
which operates the factory,
said it has no evidence to sug-
gest security guards violated
company policy, but added
“appropriate actions” would
be taken if violations are
found in a police investigation
now under way.
Three eyewitnesses said
more workers joined in the
fray and eventually smashed
windows and set fires on the
Please turn to page 16
TAIYUAN, China—The
pressures threatening China’s
status as the world’s factory
floor have been laid bare by a
riot this week at a factory
that makes parts for
Apple
Inc. and other electronics
companies, a clash that work-
ers said was sparked by oner-
ous security and repressive
living conditions.
The consequences of a riot
that erupted on Sunday in the
Hon Hai Precision Industry
Co.’s plant go far beyond the
security of Apple’s supply
chain, which relies on armies
of industrious and docile Chi-
nese workers.
The riot raises questions
about the sustainability of
Japan’s main opposition
party taps former
Prime Minister Shinzo
Abe as its leader,
which could lead Tokyo
to take a hard line on
China.
Asia News.................4
Chinese stocks keep
sliding, but some fund
managers are buying.
Business.................. 17
2
| Thursday, September 27, 2012
THE WALL STREET JOURNAL.
PAGE TWO
What’s News—
Inside
Capital:
Gaming out
the fate of the fiscal
cliff in the U.S.
8
Life & Style:
How to
find the best doctor
for you.
9
Iranian President Mahmoud Ahmadinejad, in his annual address to the U.N. General Assembly, toned down his now commonplace attacks on Israel and the U.S., in
a religious speech that called for a new global governance. He gave the speech as thousands protested outside the U.N. building in New York. WSJ.com/World
iii
Business & Finance
n
BYD is facing
renewed ques-
tions about its future as investors
grow increasingly skeptical of
prospects for the Chinese auto
maker’s core businesses.
18
over German insistence on parity
with France in the combined firm
and British opposition to contin-
ued government influence.
19
score how Assad’s regime has lost
control of security in the capital.
3
n
U.S. and European shares fell
as worries about Spain and Greece
intensified. Asian markets also de-
clined, with Japan’s continuing
territorial dispute with China
weighing on sentiment.
26
n
The CIA has been notifying
Pakistan of where it plans drone
strikes, and Pakistan is clearing
the airspace without replying.
Whether this is tacit consent is
being debated in the U.S.
14
n
Hong Kong plans
to appoint
former KPMG executive Carlson
Tong as chairman of the Securi-
ties and Futures Commission.
24
n
Mitsubishi UFJ Lease
is in final
talks to buy Jackson Square Avia-
tion, an aircraft-leasing company,
for about $1.29 billion.
19
n
Bumi Resources offered
a first
response to news that shareholder
Bumi is investigating possible ir-
regularities at its Indonesian oper-
ations, while S&P downgraded the
Jakarta-listed miner.
17
n
U.S.-listed shares
of Santander
Mexico rose in their public trading
debut, in what was the biggest
listing to hit U.S. exchanges since
Facebook in May.
23
iii
World-Wide
n
An Indonesian ferry collided
with a ship believed to be carry-
ing liquefied natural gas and sank,
killing at least eight people.
n
The U.K. trial
of former News
Corp. employees facing charges in
the phone-hacking investigation
will begin in September 2013.
18
Deal Journal Asia:
TPG’s founder is
upbeat on China.
25
n
A court in the Maldives
banned
former President Mohamed
Nasheed from leaving the capital
without official permission.
n
Fashion retailer Esprit
in-
stalled its new CEO as it reported
fiscal-year revenue that widely
missed analysts’ estimates.
20
n
Indian billionaire Vijay Mallya
said Kingfisher Airlines is in talks
to sell a stake to a foreign carrier
after the Indian government this
month permitted such investment
for the first time.
19
n
Two blasts struck
Syria’s mili-
tary headquarters in Damascus,
the latest in a string of attacks
against state facilities that under-
n
Died: Andy Williams
, 84, one of
the most distinctive of the classic
crooners, of cancer.
WSJ.com/US
n
Merger talks between
Airbus
parent EADS and BAE hit a snag
ONLINE TODAY
Most Read in Asia
China Real Time
wsj.com/chinarealtime
Work & Family
U.S. News (Video)
wsj.com/video
Apple’s special
version of maps for
China leave viewers
in the country
unable to see the
rest of the world.
Americans borrow
a page from Spain’s
large tomato fight—
La Tomatina—as
the Tomato Battle
comes to
Bridgeview, Ill.
Corporate News:
Lynas will defend its
refinery in court.
21, 32
1. China Adds Carrier to Its Navy
2. Google Maps vs. iPhone 5
3. Japan Car Makers Feel Chinese
Chill
4. Facebook’s Next Fight: Suits,
and More Suits
Most Emailed in Asia
1. Your Body’s Peak Time for
Everything
2. Japan Car Makers Feel Chinese
Chill
3. How to Stop Hospitals From
Killing Us
4. Why Kids Get Autism: New
Genetic Clues
THE WALL STREET JOURNAL ASIA
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THE WALL STREET JOURNAL.
Thursday, September 27, 2012 |
3
WORLD NEWS
Blasts Hit Military Site in Heart of Syrian Capital
B
Y
N
OUR
M
ALAS
The rebel Free Syrian Army claimed
responsibility for the bombing, say-
ing dozens of people were killed in
an attack targeting military officers.
Rebel fighters clashed with security
forces for hours after the bombings,
inside buildings and from rooftops
around the area, according to fight-
ers and residents.
The government, calling the at-
tacks a “terrorist act,” initially said
its army and defense staff were safe.
Syria’s state agency later reported,
citing a military source, that four
guards at the building died of
wounds. Fourteen others, some civil-
ians and some military staff, were
injured, the agency said.
Despite the conflicting accounts,
the attacks appeared to be further
proof of rebel fighters’ reach in the
capital.
A correspondent for Iranian
state-owned Press TV, Maya Naser,
was killed by sniper fire while re-
porting on the attacks, the broad-
caster said on its website. Hosein
Mortada, its Damascus bureau chief,
was injured in the same incident,
Press TV said.
Mr. Naser, a 33-year-old Syrian
national, was shot while reporting
on the air, the channel said, blaming
insurgents.
“We hold Turkey, Saudi Arabia
and Qatar, who provide weapons and
militants to kill civilians, military
personnel and journalists, responsi-
ble for killing Maya,” said Press TV’s
newsroom director, Hamid Reza
Emadi.
It is the first time a reporter has
been killed while covering the con-
flict in the heart of the capital, con-
sidered a relative safe zone even as
sustained fighting has engulfed
much of the rest of Damascus in re-
cent months. At least 19 other jour-
nalists have been killed covering the
conflict across Syria, making the
country the most dangerous place in
the world for reporters, according to
the Committee to Protect Journal-
ists.
Syria’s government and its chief
international backers, Iran and Rus-
sia, blame the 18-month-long con-
flict on armed insurgents financed
and supported by foreign states. Iran
has advised Mr. Assad closely
throughout the uprising, dispatching
senior officials and military advisers
to Damascus.
Syria’s opposition, and its re-
gional and Western backers, allege
Iran has played a more direct role in
Mr. Assad’s crackdown on the rebel-
lion.
BEIRUT—Two large explosions
hit Syria’s military headquarters in
Damascus on Wednesday, the latest
in a string of attacks against state
facilities that underscore how Presi-
dent Bashar al-Assad’s regime has
lost control of security in the capi-
tal.
The explosions went off just be-
fore 7 a.m. local time in the capital’s
Umayyad Square, a major round-
about, and in the nearby district of
Abu Rummaneh, and were followed
by hours of gunfire, said Damascus
residents and government officials.
A single journey can change the course of a life.
Cambodia, May 2011.
Follow Angelina Jolie on louisvuitton.com
4
| Thursday, September 27, 2012
THE WALL STREET JOURNAL.
WORLD NEWS: ASIA
Ex-Premier to Lead Japan Opposition
B
Y
A
LEXANDER
M
ARTIN
2%-3% from the current 1% and has
even proposed revising the BOJ law
to hold the central bank more ac-
countable for achieving the price in-
crease.
“Pressure on the BOJ could in-
crease further under a government
led by Mr. Abe,” said Satoru Mat-
subara, economics professor at Toyo
University in Tokyo.
Mr. Abe has also come under fire
for raising questions about the na-
ture of the role the Japanese army
played in the recruitment of so-
called comfort women who served
as sex slaves during World War II.
South Korea has condemned this
view of history, and demanded com-
pensation for former Korean women
who say they were forced into pros-
titution during the war.
South Korean President Lee
Myung-bak said Japan’s failure to
address the issue was a factor be-
hind the recent flare-up in their ter-
ritorial rivalry with Japan over a
group of tiny islets. Mr. Lee’s land-
ing on one of the islands has soured
bilateral ties, prompting Japan to
take the dispute to the International
Court of Justice.
“Mr. Abe’s election as president
of the LDP could be received as a
further sign of Japan’s conservative
shift,” said Koichi Nakano, political-
science professor at Sophia Univer-
sity in Tokyo.
The LDP, which ruled the country
almost uninterrupted for more than
five decades, is demanding early
elections.
TOKYO—Japan’s main opposition
party picked former Prime Minister
Shinzo Abe as its new leader, a
move likely to jack up pressure on
the government to take a hard line
against China.
In a rare political comeback in
Japan, Mr. Abe is likely to lead the
Liberal Democratic Party into a gen-
eral election that is expected within
months. He could once again be-
come prime minister should the
party return to power. Recent media
polls show the LDP ahead of the rul-
ing Democratic Party of Japan in
voter support.
Mr. Abe is known for his hawkish
security stance as well as his con-
servative, controversial views on Ja-
pan’s wartime actions. His party
leadership victory comes at a time
when Tokyo’s ties with its Asian
neighbors have been frayed by ris-
ing tensions over territorial dis-
putes.
“I will do my best to get us back
in power,” he told fellow LDP law-
makers on Wednesday after he was
chosen as party president.
Mr. Abe has been criticized for
abruptly stepping down as prime
minister in 2007 after only a year
on the job. While he cited health
reasons as a factor, the sudden res-
ignation has been blamed for invit-
ing voter disenchantment with poli-
tics and starting a chain of prime
ministers who lacked staying power,
each lasting only about a year on
Shinzo Abe speaking after he was chosen as the Liberal Democratic Party’s president in Tokyo on Wednesday.
average. “I apologize for the trouble
I caused, but I’ve been given a mis-
sion to lead a new and strong LDP
in these difficult times,” Mr. Abe
told the lawmakers.
Foreign policy was at the fore-
front of the LDP race, as territorial
spats with China and South Korea
have dominated headlines in recent
weeks.
The 58-year-old Mr. Abe has crit-
icized Prime Minister Yoshihiko
Noda’s handling of the disputes,
calling for a beefing up of security
arrangements for the Senkaku is-
lands, the chain of isles in the East
China Sea also claimed by China,
which calls them the Diaoyu.
On economic policy, Mr. Abe has
advocated a more assertive fiscal
policy and demanded that the Bank
of Japan do more against deflation.
Specifically, he has called on the
BOJ to raise its inflation goal to
India Makes Pitch for Northeast ‘Paradise Unexplored’
In northeastern India, the
tourism industry is starting from
a low base. While government
data show that the number of
foreign tourist arrivals in India
went from 2.38 million in 2002,
when the Incredible India
campaign was launched, to a
record 6.29 million last year, the
number of tourists in the
northeast is still negligible.
For instance, only 389 foreign
travelers visited the northeastern
state of Manipur in 2010, the
latest year for which state-specific
data are available—and the lowest
figure in the country. Overall, the
region attracts 0.3% of
international tourists who visit
India and 0.9% of domestic tourist
numbers.
Sikkim, a well-known trekking
destination with something of a
mystical draw, is an exception:
Some 90,000 tourists visited the
state in 2010, of which over
20,000 were foreign.
But the remaining seven states,
which are more remote than
Sikkim, are a bigger marketing
challenge. While a comparable
branding initiative in Kerala—
“God’s Own Country”—helped to
place the southern Indian state on
the international tourism map,
repeating that for northeast India
might prove difficult.
While there’s lots going for the
region—unspoiled nature and
vibrant indigenous cultures are its
strongest selling points—there are
downsides, too.
Above all, there are safety
concerns stemming largely from
the occasional flare-ups of
insurgent violence, frequent
episodes of communal clashes and
natural disasters such as floods.
While these problems exist,
northeastern states have done
little to promote alternative
narratives, some argue. “They’ve
done a very poor job at
marketing,” says Subhash Verma,
who heads an association of
Indian tour operators. That’s how
“Paradise Unexplored” could be
useful.
Perhaps the biggest obstacle to
tourism in the region, however, is
the lack of adequate
infrastructure. Improving
accommodations as well as road
and railway connectivity are
among the priorities of the
tourism master plan.
But for “Paradise Unexplored”
to become a reality, there is a
need for plenty of funding.
The master plan estimates
total development costs of $1.22
billion, of which around two-
thirds will come from the
government and the rest from the
public sector.
—Margherita Stancati
“Positive Indian Ocean Dipole
generally helps the monsoon,” he
said, adding that it might have
canceled out the effects of El
Niño, another weather event that
was present this year in the
Pacific Ocean and usually limits
rainfall in India. (It was El Niño
that caused India’s drought in
2009—the worst in nearly 40
years.)
And there is no sign yet of the
monsoon rains subsiding in some
parts of India, though usually the
monsoon rains start withdrawing
from the country by Sept. 1.
“It will take at least three to
four days more to tell
anything....Only after that maybe
we will know about withdrawal,”
he said.
Nobody is complaining as the
late rains are filling up water
reservoirs, most importantly over
the country’s grain-bowl northern
region, where they had dropped to
alarming levels earlier during the
summer.
The higher soil moisture also is
expected to improve prospects for
the winter-sown crops such as
wheat and oilseeds, alleviating
some of the misery for India’s
farmers.
The drought earlier in the
season has greatly affected the
sowing of rice, corn and
sugarcane crops. Harvest of these
crops, which will begin soon, are
likely to be sharply lower than
normal.
The “Incredible India”
campaign that was launched a
decade ago helped to market the
country as a travel destination.
Tourists have since flocked to
India in growing numbers.
But one region felt it has been
missing out.
“The northeast was not able to
jump on the bandwagon of the
campaign known as Incredible
India,” U.K. Sangma, a senior
official at the North Eastern
Council, a body aimed at
promoting economic and social
development in the region, said
during a discussion on the topic in
New Delhi on Tuesday.
To make up for it, the council
in 2010 commissioned Tata
Consultancy Services Ltd. to come
up with ways of attracting
tourists to the eight landlocked
northeastern states, which are
linked to the rest of India by a
sliver of land and lag in
development.
As part of the 10-year plan,
which was unveiled at Tuesday’s
event, the region is set to embrace
a marketing tagline of its own:
“Paradise Unexplored.”
“The idea is that if you haven’t
been to the northeast, you haven’t
been to paradise,” said Priya M.
Verghese of Tata Consultancy
Services, who worked on the
project. She says the region has
“all that a tourist would look for.”
Clues to Monsoon’s
Mysterious Turnaround
After scanty rains through
much of the summer season
caused a drought through swaths
of India, the monsoon has
suddenly picked up with a fury
since late August.
So far, the season’s overall
monsoon rainfall has been just 5%
below average levels, despite
almost no rain in much of
northern India in July and early
August. So what exactly brought
about this bewildering
turnaround?
While weather officials are still
to pinpoint the exact cause, the
change in India’s rain fortunes
was to a large extent likely
brought about by a phenomenon
called “positive Indian Ocean
Dipole”—a meteorological
condition in which the western
part of the Indian Ocean becomes
warmer than the eastern part,
said D.S. Pai, head of long-term
forecasting for the state-run India
Meteorological Department.
—Biman Mukherji
and Debiparsad Nayak
Keep up on India minute by
minute with The Wall Street
Journal’s India Real Time at
Loktak Lake in Manipur, a state only 389 foreign travelers visited in 2010.
THE WALL STREET JOURNAL.
Thursday, September 27, 2012 |
5
**
WORLD NEWS: ASIA
Singapore Takes a Hit
Thai Premier Looks
ToLiftConsumption
B
Y
M
ARTIN
V
AUGHAN
SINGAPORE—Singapore’s manu-
facturing output unexpectedly de-
clined in August as electronics pro-
duction dropped steeply, bolstering
the view that the city-state will slide
into recession and its central bank
will ease monetary policy.
Singapore’s economy contracted
0.7% in the second quarter from the
preceding period, and a third quar-
ter contraction is now looking very
likely.
“A technical recession is politi-
cally significant,” said Wai Ho Le-
ong, senior Asia economist at
Bar-
clays
. “With this now likely, we
expect the central bank will be in-
clined to support growth.”
Industrial production fell 2.2% in
the month, compared with a median
forecast for a 1.0% increase in a Dow
Jones Newswires poll. Electronics
output, which accounts for a third
of total manufacturing, fell 7.3%, for
a cumulative 12% fall in the first
eight months of the year.
The surprise decline in August
underlines the headwinds still fac-
ing Asia’s manufacturers, even amid
some signs that economic condi-
tions in the region are improving.
Taiwan’s industrial output
growth picked up sharply in August,
according to data released this
week, as the island’s electronics
manufacturers were buoyed by the
release of the iPhone 5. Taiwan’s
central bank governor said Wednes-
day the bank likely will remain on
hold over the next six months.
“This data reflects that
B
Y
G
EORGIA
W
ELLS
NEW YORK—Thailand’s economic
policy is focused on boosting do-
mestic consumption as exports are
hit by slowing global growth, the
country’s prime minister
said
Wednesday.
Exports to China, Europe and the
U.S. have long fueled the Southeast
Asian nation’s economic growth. But
as the global economy slows, so too
has export demand. That is forcing
the government to look to its con-
sumer base to drive its economy.
“Our policies are to accelerate
domestic consumption—it will
strengthen us in the long run,” said
Prime Minister Yingluck Shinawatra
in an interview with The Wall Street
Journal.
On Tuesday, Thailand’s Finance
Ministry lowered its 2012 growth
forecast to 5.5% from 5.7% three
months ago. Last year, Thailand’s
economy grew by 0.1%, after the na-
tion’s worst flood in decades dis-
rupted manufacturing.
This year, the government plans
to spend $4 billion to help compa-
nies that suffered flood damage re-
turn to full production. The govern-
ment will also expand local
infrastructure and maintain fiscal
policies aimed to boost revenue
from local consumption.
“It’s OK to have some inflation.
Higher inflation—I don’t think that
will be a concern,” Ms. Yingluck
said.
Singapore’s economy contracted in the second quarter and a third-quarter
contraction is now looking likely. Above, shoppers at a mall in Singapore.
global environment is still quite
rough,” said Johanna Chua, chief
economist for the Asia Pacific at
Citigroup, on the release of the Sin-
gapore data. “But in the absence of
repeated shocks, I don’t expect the
recession will be prolonged. Once
global demand stabilizes, Asia could
bounce back very quickly,” she said.
The weak manufacturing reading
also adds to the case for the Mone-
tary Authority of Singapore to relax
its monetary policy stance when it
meets for its twice-yearly policy de-
cision in mid-October. That would
bring it in line with other Asian cen-
tral banks, many of whom embarked
on easing months earlier even as
Singapore battled persistent infla-
tion.
The combination of more benign
inflation data, released Monday, and
the industrial output figures set the
stage for likely MAS easing next
month, several economists said. The
central bank will likely retain a bias
toward appreciation of the Singa-
pore dollar, but slow the pace of
that appreciation.
Singapore uses the exchange rate
as its main monetary policy tool, be-
cause of its small domestic economy
and outsize exposure to interna-
tional trade.
The decline in Singapore’s out-
put in August comes after manufac-
turing output in July rose by a re-
vised 2.5%. On a month-on-month
basis, August output declined a sea-
sonally adjusted 2.3%, after falling
8.7% in July. Economists in the poll
had expected a 0.2% rise from July.
Transport engineering fell
sharply, contracting 20.1% from a
year earlier, compared with a 6.0%
gain in July, as oil rig projects and
aircraft engine repair work dropped
off.
Yingluck Shinawatra on Wednesday.
This view reflects a trend across
emerging-market economies where
policy makers focus more on stimu-
lating growth rather than control-
ling inflation. Thailand’s inflation
rate is forecast at 3.5% in 2013 com-
pared with 3.3% this year, according
to the Finance Ministry.
Many emerging-market countries
are also adjusting their economic
policies in response to monetary
stimulus in the U.S. that weakens
the value of the dollar, rendering
other countries’ exports less com-
petitive.
Asked about the U.S. Federal Re-
serve’s quantitative-easing program,
the prime minister said she prefers
more “gradual” easing that balances
currency supply and demand.
the
China’s Guangzhou Curbs
Some Luxury-Home Sales
B
Y
E
STHER
F
UNG
data provider China Real Estate In-
dex System.
China has pushed ahead with a
more than two-year campaign to
keep property prices from spiraling
out of control, using a combination
of credit curbs, higher down-pay-
ment requirements and limits on
home purchases. That had pushed
prices lower over much of this year,
but a policy shift in February to
help first-time buyers has led to a
slight market upturn in recent
months. Housing sales and prices
have risen in some Chinese cities
since May, after the central govern-
ment implemented more accommo-
dative policies.
But officials have said that, as
the property market warms, author-
ities must ensure prices don’t rise
too quickly and speculation is con-
tained.
China’s Guangzhou city has
halted sales of some high-end resi-
dential units to prevent prices from
rising rapidly and misleading pro-
spective buyers and sellers, the
city’s housing bureau said.
An increase in sales of luxury
units has raised average housing
prices, making it necessary to carry
out “phased” property control mea-
sures, the Municipal Land Resources
and Housing Administrative Bureau
said on its microblog late Monday. It
didn’t elaborate on the duration of
the halt.
Average prices of newly built
residential units in Guangzhou rose
over the four months to August. In
August, prices rose 0.37% from July
to 15,300 yuan ($2,425) a square
meter, according to private-sector
Bloomberg News
Guangzhou city is halting sales of some luxury housing units to keep property
prices from rising rapidly. Above, Guangzhou’s Pearl River New Town district
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