27/03/2025

BIZ & FINANCE THURSDAY | MAR 27, 2025 17 Hong Kong to benefit from China investment outflows

DBS said to be leading race to buy controlling

stake in Panin Bank SINGAPORE: DBS Group, Southeast Asia’s top bank by assets, is the frontrunner to buy a controlling stake in Indonesia’s Panin Bank , three people with knowledge of the matter said. The Singapore lender was competing with Malaysia’s CIMB Group in the second round of the bidding process, according to one of the people. Roughly 86% of Panin Bank, Indonesia’s 12th largest lender, is up for sale. As of Tuesday’s market close, the combined holding owned by Australia’s ANZ and the Gunawan family was worth US$1.8 billion (RM7.9 billion). ANZ, which owns 39% according to LSEG data, has been trying to sell its stake since 2013. The founding Gunawan family is flexible about how much it might sell and the amount will depend on the offer price, sources have said. Binding bids for the stake are due by end-April or early May subject to market conditions, according to two of the people, who added that the thinking of the bidders could change. DBS, ANZ and CIMB declined to comment. Panin Bank’s President Director Herwidayatmo referred Reuters’request for comment to its controlling shareholders. If successful, DBS’ acquisition of the Panin Bank stake would be first deal under incoming CEO Tan Su Shan. Tan, who will assume the role on March 28, told Reuters this week that DBS is open to bolt-on acquisitions if they fit strategically, created additional value and are earnings accretive within an acceptable period of time. Analysts say the deal would propel DBS, which has a unit in Indonesia, to rank among the country’s top 10 biggest banks. – Reuters Japan Airlines orders 17 Boeing 737 MAX aircraft NEW YORK: US aviation giant Boeing on Tuesday said it had finalised a firm order from Japan Airlines for 17 737 MAX 8 aircraft, almost doubling the airline’s overall orders of the plane. “The 737 has been the backbone of our single-aisle fleet for nearly 50 years, and we are honored to continue its legacy as part of our future fleet,” said Japan Airlines president Mitsuko Tottori, according to a statement published by Boeing. The 17 new planes come on top of 21 737 MAX 8 aircraft which Japan Airlines ordered in March 2023. The value of the new order was not specified. The model, which entered service in May 2017, consumes less fuel and emits 15% fewer greenhouse gases than the 737-800 it replaced, Boeing said. In March 2024, Japan Airlines announced an order for ten Boeing 787-9 Dreamliners as part of a larger purchase which also including 32 aircraft manufactured by Boeing’s European competitor Airbus. In total, the airline is now expecting delivery of 48 aircraft from Boeing, and 39 from Airbus, it said in a statement last week. At the end of February, Boeing’s order book contained 6,197 aircraft, including 4,270 orders for the 737 MAX. – AFP

Hong Kong will help provide the next push for Hong Kong’s capital markets,” he said. Offshore listings of Chinese companies in Hong Kong have swelled in recent months, with sizable tech and consumer companies expected to raise billions in the coming weeks. Yue said more long-term investors are returning to the Hong Kong market, encouraged by Beijing’s stimulus policies and hopes fuelled by AI innovation such as DeepSeek. The banking chief also expects Hong Kong to benefit from the rising usage of the Chinese yuan in international trade in recent years spurred by a shift in trade corridors. “We’re also seeing a lot of funding activities in Hong Kong issuing RMB bonds,” he said, adding that issuance doubled in three years to more than one trillion yuan (RM610 billion) in 2024, and RMB lending increased by three times to 750 billion yuan during the same period. – Reuters

launched in 2021, had helped boost capital flows into the city. The number of Chinese investor accounts under the scheme shot up from 25,000 to 95,000 in four months following the relaxation of the rules in February last year. Yue did not disclose more up-to-date figures, but added that authorities plan to further relax the scheme’s investment rules. “We will also explore whether it is possible to even extend the scheme geographically to other parts of China,” he said. Between 20% and 30% of Hong Kong stock market’s turnover is capital flowing from China through the stock connect, according to Yue. That trend is expected to strengthen in the years ahead, Yue added, as Chinese investors continue to utilise stock, bond and wealth management connect channels to invest in the offshore investment hub. “I’m quite hopeful that all these Southbound capital coming out from China into the world through

o Central bank chief says city also beneficiary of rising use of yuan in trade

HONG KONG: Hong Kong’s central bank head said yesterday that he expects Chinese capital inflows to Hong Kong to provide the biggest opportunity for the financial hub’s capital markets in the next few years. Hong Kong is planning to further relax rules on a wealth connect programme with China’s Greater Bay area and is exploring whether it can extend its coverage to more mainland cities, Hong Kong Monetary Authority chief executive Eddie Yue said at HSBC’s Global Investment Summit in Hong Kong. “I think the bigger opportunity in the next few years will come from what we call Southbound, Chinese capital going out to the world through Hong Kong,” Yue said, compared to northbound flows that

are offshore capital going into the mainland. China still places strong capital controls to manage flows in and out of the border, with a few connect schemes permitting capital to be deployed in some key offshore market such as Hong Kong. Global investors have been accessing China assets through the offshore investment hub, but a weaker outlook for the world’s second-biggest economy and geopolitical uncertainties have slowed foreign capital inflows in recent years. Chinese investments overseas, however, have picked up and Hong Kong has benefited from these capital flows. Yue said the easing of rules governing the wealth connect scheme,

Vietnam to cut duties on US imports, approve Starlink HANOI: Vietnam said it plans to cut import duties on a range of goods including cars, liquefied gas and some agricultural products, as concerns escalate over potential US tariffs. tariffs, which have sent shockwaves through global markets. According to the Finance Ministry statement, import duties on some cars will be cut by half and the tax rate for liquefied natural gas will drop from 5% to just 2%. It is also necessary “to ensure fair treatment among Vietnam’s Comprehensive Strategic Partners”, the statement added, citing Nguyen Quoc Hung, director of the department of tax management and supervision. Prime Minister Chinh this month told US ambassador Marc Knapper that Vietnam was “actively addressing the current concerns of the US in economic-trade

investment relations”, including sending its top trade official to the United States. The US trade deficit in goods with Vietnam was US$123.5 billion (RM547 billion) in 2024, up more than 18% on 2023, according to the Office of the United States Trade Representative. Vietnam is a manufacturing powerhouse that is heavily reliant on exports and the United States was the country’s biggest market last year. – AFP

The announcement on the Finance Ministry’s website on Tuesday came less than two weeks after Prime Minister Pham Minh Chinh said the country was reviewing duties in order to encourage increased imports from the United States. Vietnam represents the United States’s third-highest trade deficit, behind China and Mexico. There is increasing worry that Hanoi could be the next target of President Donald Trump’s

Vietnam also said yesterday that it would allow Elon Musk’s SpaceX to launch its Starlink satellite internet service as part of a pilot programme that will last until the end of 2030. There is no limit on foreign ownership of the service, the government said in a statement on its website. The US and Vietnam became comprehensive strategic partners in 2023.

Duties will also be cut for a number of other products including frozen chicken thighs, almonds, sweet cherries, raisins and wood. The changes, which should be implemented this month, are to “cope with the complicated and unpredictable developments of the world’s geopolitical and economic situation, especially the changes in economic, trade and tariff policies”, the statement said.

A street vendor selling vegetables holds up cabbages for customers

in Hanoi. – AFPPIC