|Frontier's "Invest Mongolia Tokyo 2018"||Frontier Securities||Tokyo Japan|
|"Open to Export" ICC WTO International business award||ICC WTO||London|
Paradoxes abound along route of Belt, Road
In Beijing, you beg for the wind to start, here, in Erenhot, you beg for the wind to stop.
Bordering Mongolia, Erenhot in North China's Inner Mongolia Autonomous Region is located 700 kilometers north of Beijing. A recent visit to the city brought me messages from the North.
"Mongolia is a brutal and green force, if you plant genetically modified food, they send you to jail."
"Mongolia has no industrial exports, all it has is meat."
"Most Mongolians are quite friendly toward Chinese people, but there are those who treat Chinese otherwise."
These messages came from border people who frequently had social and economic interactions with Mongolians, and the proximity to these sources makes Erenhot a perfect place to contemplate the progress of and impediments to the China-Mongolia-Russia economic corridor, a key component of the China-proposed "One Belt and One Road" (B&R) initiative.
Officially called the Silk Road Economic Belt and the 21st Century Maritime Silk Road, the B&R initiative was proposed in 2013.
To be sure, there are some paradoxes. Take the transportation sector, for example. On the one hand, China, Mongolia and Russia are jointly experimenting with an overland route to be serviced by freight trucks crossing the borders and delivering goods to clients in all three countries.
On the other, seasoned transportation operators at Erenhot said they just dump their goods onto Mongolian trucks waiting at the border and skip the rest of the journey, because years ago they were harassed by some Mongolians to such an extent that they now avoid the business.
The railway is an even more appropriate example. On the one hand, Mongolia has expressed its willingness to attract more CHINA RAILWAY Express [freight] services to traverse its territory by offering a discounted access fee, according to a document seen by the Global Times.
On the other hand, traders who had actually used the Mongolian railway system sharply criticized its outdated infrastructure and low efficiency. "[In transportation], the Mongolian section has become a bottleneck for the China-Mongolia-Russia economic corridor," said one.
It leaves one wondering: Why is it that even as Chinese-funded railways have flourished from the plateaus of Ethiopia to the savannah of Kenya, a China-related railway infrastructure project in Mongolia is largely ignored?
The matter is at root one of political distrust. Just as Mongolians adamantly defend their traditional, self-sufficient, nomadic lifestyle against globalization and modernization, some Mongolians are also carefully evading the influence of a rising China.
While the two sentiments are understandable, albeit for different reasons, neither is likely to survive.
Many Mongolians visiting Erenhot said that they just feel like visiting a relative's home, and it is based on this cordial relationship of trust that border trade has prospered.
It is undeniable that the Mongolian economy is closely related to China's and Russia's. The effect of a third country, such as Japan, is very limited.
How Mongolia ended in a bust from a boom and it solved its recent debt woes are to a large extent related to its attitude toward China.
On the state level, maybe something can be learned. Only when there is mutual trust, can the bonds of the Silk Road Economic Belt truly link the two complementary economies.
Mongolia's opposition Democratic Party on Thursday tapped former judo star and self-made millionaire Khaltmaa Battulga as its candidate in next month's presidential election in the landlocked country which is facing economic crisis.
With just three million people, Mongolia, a former Soviet satellite best known as the birthplace of the Mongol emperor Genghis Khan, has long stood as an oasis of democracy, sandwiched between autocratic giant neighbors China and Russia.
Mongolia's political transformation since a peaceful revolution in 1990 has been a big plus for foreign investors eyeing its rich mineral resources.
Mongolians choose their next president on June 26 as incumbent president and fellow Democrat Tsakhia Elbegdorj completes his second and final term amid flagging economic conditions following a short-lived mining boom that left few better off.
The Democrats led a governing coalition from 2012 to 2016 before the Mongolian People's Party won back the parliament last year, winning 65 seats in the 76-member legislature.
Battulga, a former judo star turned business tycoon, was a member of parliament before losing his seat last year.
He previously had ministerial roles in roads and transport as well as agriculture, and is known for his criticism of China, especially over concerns Mongolia is too economically dependent on its neighbor.
Battulga will face parliament speaker Mieygombo Enkhbold from the Mongolian People's Party.
Mongolia's economy has slid into problems caused by heavy foreign debt, a collapse in its currency and a slowdown in growth in its biggest trading partner, China.
The International Monetary Fund has postponed a $5.5 billion bailout for Mongolia because of a measure included in the country's 2017 budget that forces foreign firms to bank with domestic institutions.
There have also been concerns about the government's growing authoritarian tendencies.
Last week blank screens and red text warning about threats to press freedom interrupted Mongolian television to protest against planned legal changes media groups say could harshly punish journalists accused of defamation ahead of elections.
The government subsequently backed down.
(Reporting by Terrence Edwards; Editing by Ben Blanchard)
Ankara has withdrawn a 130 percent tariff on Russian grain following the meeting between Russian President Vladimir Putin and his Turkish counterpart Recep Tayyip Erdogan in Sochi.
Russia will resume exporting wheat to Turkey without restrictions starting from Thursday, Turkish Economy Minister Nihat Zeybekci told Bloomberg.
Turkey introduced the tariff on Russian grain in response to Moscow's ban on Turkish tomatoes and other produce following the downing of a Russian jet in Syria in November 2015.
While Russia risked losing its second biggest buyer of wheat after Egypt, Turkey had faced higher prices elsewhere.
The Wednesday meeting in Sochi between Putin and Erdogan did not solve the issue of Turkish tomatoes. Putin said Russian farmers have taken out significant loans to boost domestic production and construct greenhouse facilities, so lifting restrictions now will hurt them.
However, Turkey will sell tomatoes to Russia in seasons when the country can’t grow sufficient amounts. Before the deterioration in relations, 70 percent of Turkish tomatoes were exported to Russia.
Ankara’s apology and the subsequent thaw between the countries failed to settle the issue. In March, Russia lifted the restrictions against Turkish onions, cauliflower, broccoli and some other vegetables, explaining there is a lack of these food items in Russia.
Turkey complained that it's only a fraction of tomato sales.
“Russia raised restrictions on some products that totaled $19 million. That’s the value of what’s exported by one little company," Turkish Foreign Minister Mevlut Cavusoglu told Bloomberg in April.
Turkey has failed to replace the Russian market, and its farmers are facing hard times without exports to Russia.
“We cannot survive without the Russian market. Wastage rates have never been this high,” Munir Sen, the head of the association of fruit and vegetable brokers in Mersin, a city which has Turkey’s biggest seaport, told Bloomberg.
BEIJING - While the much-awaited first Chinese-built passenger jet C919 is ready to make its maiden flight Friday, it may take much longer for the newcomer to take off in the aviation market.
Shaking the dominance of aviation giants Boeing and Airbus in the near future is unrealistic, observers say, but the Chinese jetliner could be a strong option for global carriers in decades to come.
Scheduled to depart from Shanghai Pudong International Airport on May 5, the C919, with 158 seats and a standard range of 4,075 kilometers, is expected to compete with the updated Airbus 320 and Boeing's new generation 737.
A total of 23 foreign and domestic customers, including China's national carrier Air China and leasing company GE Capital Aviation Service, have placed orders for 570 aircraft, according to the Commercial Aircraft Corporation of China (COMAC).
But this is only the very first step. Even in China's domestic market, COMAC has a long way to go to turn technical success into business success.
Currently, Chinese airlines seem to be more keen to spend money on wide-body aircraft to enhance their global routes with rising enthusiasm for overseas travel. Those jets are still the exclusive province of Boeing and Airbus.
China Eastern Airlines signed contracts in 2016 to buy 20 A350-900 aircraft from Airbus and 15 B787-9 aircraft from Boeing to be delivered between 2018 and 2022.
China Southern Airlines announced in April that it will buy 20 A350-900 with a total catalog price of nearly $6 billion.
Boeing and Airbus are very mature aircraft manufacturers, and COMAC should seek further cooperation with them to learn from their experiences, according to aviation analysts.
But looking ahead, single-aisle planes like C919 will be the market mainstream and COMAC should do well in the Chinese market, one of the most competitive.
Boeing predicted last year that China will become the world's top aviation market within 20 years, projecting a demand for 6,810 new aircraft in the next two decades with a total value of $1 trillion.
China will need 5,110 new single-aisle airplanes through 2035, accounting for 75 percent of the total new deliveries, according to Boeing.
The C919 will be a strong competitor in this field being economical and comfortable, according to a research note from Guosen Securities.
If the maiden flight is successful, COMAC will seek airworthiness certificates from the Civil Aviation Administration of China and foreign aviation safety regulators before making its first deliveries.
Also, to pave way for C919 to enter foreign markets, the airworthiness certification of the jet will be a part of bilateral air safety agreement talks between China and the EU.
China has invested heavily in commercial passenger jet manufacturing. In 2007, plans to develop a domestic large passenger jet were approved by the State Council. In November 2015, the first C919 jet rolled off the assembly line.
The ARJ21, the country's first regional aircraft also produced by COMAC, began commercial operations in June 2016 following its maiden flight in 2008....
Parliament cancelled its decision to pass big projects sales income through Mongolian banks www.montsame.mn
Ulaanbaatar /MONTSAME/ The second clause of Parliamentary resolution number 29, which indicated to raise state currency reserve by passing sales income of big projects with foreign investment through accounts of Mongolian banks, was cancelled during yesterday’s (May 4) plenary session of the Parliament. 65.5 per cent or 36 MPs out of the attended 55 backed to cancel the clause.
On April 14, parliament approved amendments to the 2017 state budget and other following laws and resolutions, which included resolution number 29. The Budgetary standing committee of Parliament developed a draft resolution to cancel the clause, in a request by Finance Minister, because it has caused difficult condition to implement joint program with the International Monetary Fund.
During the discussion, Democratic Party group in parliament asked five-day break in connection with the issue. DP group head MP D.Erdenebat said the discussion of the issue breaches the law on parliamentary procedure and the pressing problem could be resolved without touching the very important clause. However, DP group was allowed just 30-minute break, and after which the discussion continued, approving to cancel the second clause.
According to the Report on Environmental State For 2015-2016, 76.8 percent of the Mongolian territory has been struck by desertification as a consequence of fast-spreading dryness in the recent years. The report was presented by Minister of Environment and Tourism, Ms D.Oyunkhorol at a cabinet meeting.
The main cause of desertification was the 2.5 times increase in the population of livestock since 1990 and failure to maintain the traditional methods of pasture rotation and going on search for better grazing lands, says the report.
Another concern is the increased frequency of atmospheric hazards. In specific, average of 30 atmospheric incidents were observed each year from 1990 and 2000, whereas the number had doubled between 2001 and 2016. For instance, the number of days with dust storms went up to 47 in 2015 from 37 in 2014.
Although Mongolia’s total carbon dioxide emission is lower than the global average, 6.08 metric tons of CO2 emission per capita indicates a number that is quite higher than the global average.
Climate change, pastoral degradation and improper mining activities have speeded up the drying process of surface waters – springs, rivers, ponds and lakes. According to results of 2016 centralized census of surface water, a total of 774 springs, 263 small and large rivers and 346 lakes have dried out.
Moreover, 88 percent of the soil samples from Ulaanbaatar used in the soil test conducted in 2014 were tested positive with various bacteria, mould and fungus, as well as ammonia contamination in densely populated areas.
Wastewater coming from the central sewerage and industrial waste have contributed to Tuul River pollution. The report reads that contents of nitrate azote and rock phosphate at the river’s influx have tendency to increase since 1985.
TOKYO -- Japanese leasing company Orix decided Thursday to invest about $627 million in an American geothermal technology company, aiming to bring the technology to Asia to tap what it expects to be a growing market.
Orix will take a 22.1% stake as early as July in Nevada-based Ormat Technologies, which designs, builds and sells geothermal power plants and equipment. The New York-listed company also operates plants in the U.S., Central America and Africa. The company reported revenue of $662.6 million last year, an 11% increase. It is the world's top maker of binary geothermal equipment, which can generate power even at lower temperatures.
This will mark Orix's first investment in a geothermal company. The group already operates a geothermal plant via the Suginoi Hotel in Japan's Oita Prefecture, which it acquired in 2002. It has partnered with Japanese municipalities in the field as well. The company anticipates growing demand for geothermal power as a form of renewable energy that does not depend on weather.
Orix has been expanding its renewable-energy operations through investments in other enterprises. It bought into an Indian wind power project in March 2016 and a Vietnamese hydroelectric company that September.
Beijing is developing a new generation of trains capable of reaching 400 kilometers per hour, China Daily reported. The high-speed trains will be part of the so-called Belt and Road Initiative to boost economic ties with other countries.
A China Railway High-speed bullet train runs towards Beijing South Railway Station © Jason LeeBeijing targets economic growth with $500bn rail expansion
"We will apply new materials in the research and production of the future high-speed trains, such as carbon fiber and aluminum alloy, which will help to reduce weight and enhance energy efficiency,” said Qiao Feng, a senior engineer at the CRRC Changchun Railway Vehicles, a subsidiary of China Railway Rolling Stock Corporation.
He added the new trains would be able to reduce energy consumption per passenger by ten percent. They are expected to promote regional connectivity and create new businesses for China and overseas economies.
The high-speed railway will help many densely populated countries change their commuter transportation, said rail transportation researcher at the National Development and Reform Commission, Feng Hao.
"Because many markets along the Belt and Road Initiative, especially in Central Asia, Southeast Asia, the Middle East and Eastern Europe, are planning to build high-speed rail lines or to upgrade their existing systems, they are eager to gain technological support from China to assist in daily operations, maintenance and staff training," he said.
China has the world’s largest high-speed rail network with more than 20,000 kilometers and expects to more than double that to 45,000 km by 2030.
According to the Chinese National Railway Administration, the country has passenger train services running at operational speeds of 200 – 250 km/h and has the technology to produce trains with a top speed of 350 km/h.
It is actively developing high-speed train technology and last year set a new speed record with a train reaching 840 km/h on a test run. Two trains, known as Golden Phoenix and Dolphin Blue zipped past each other with only 1.6 meters of space between them.
Beijing recently unveiled plans to build the world’s deepest and largest high-speed railway station as part of its preparations for hosting the 2022 Winter Olympics.
It is also developing a new generation of trains for Russia's Moscow-Kazan high-speed railway. China plans to provide a $6 billion loan for the route which in future may become a part of a $100 billion high-speed rail line connecting the two countries.
Finance leaders of Japan, China and South Korea agreed to resist all forms of protectionism in a trilateral meeting on Friday, taking a stronger stand than G20 major economies against the protectionist policies advocated by U.S. President Donald Trump.
"We agree that trade is one of the most important engines of economic growth and development, which contribute to productivity improvements and job creations," the finance ministers and central bank governors of the three nations said in a communique issued after their meeting.
"We will resist all forms of protectionism," the communique said, keeping a line that was removed - under pressure from Washington - from a G20 communique in March when the group's finance leaders met in Germany.
China has positioned itself as a supporter of free trade in the wake of Trump's calls to put America's interest first and pull out of multilateral trade agreements.
The trilateral meetings' communique said Asian economies were expected to maintain relatively robust growth thanks to a long-awaited cyclical recovery in manufacturing and trade.
But it warned that downside risks remained and called for policymakers to use "all necessary policy tools" to achieve strong, sustainable, balanced and inclusive growth.
"We will continue a high degree of communication and coordination among China, Japan and Korea to cope with possible financial instability in the context of increased uncertainty of the global economy and geopolitical tensions," the communique said.
It also said the three countries agreed to enhance cooperation under the G20 framework and work towards a successful summit of the group in Hamburg in July.
The trilateral meeting was held on the sidelines of the Asian Development Bank's annual meeting in Yokohama, eastern Japan.
(Reporting by Leika Kihara; Editing by Jacqueline Wong)
Britain's accountancy watchdog has opened an investigation into KPMG's audit of the accounts of aero-engine maker Rolls-Royce.
The Financial Reporting Council (FRC) will probe the accountancy giant's oversight of Rolls-Royce's financial statements covering four years.
It follows Rolls-Royce's settlement of £671m with the Serious Fraud Office in January over corruption allegations.
KPMG said it was co-operating and was "confident in the quality" of its work.
The FRC said in a statement: "The FRC has commenced an investigation under the Audit Enforcement Procedure into the conduct of KPMG Audit Plc, in relation to the audit of the financial statements of Rolls-Royce Group plc for the year ended 31 December 2010 and of Rolls-Royce Holdings plc for the years ended 31 December 2011 to 31 December 2013.
"The decision to investigate follows the SFO announcement on 17 January 2017 of a Deferred Prosecution Agreement between the SFO and Rolls-Royce which relates to offences including conspiracy to corrupt and a failure to prevent bribery."
The agreements relate to bribery and corruption scandals involving intermediaries in overseas markets such as Indonesia and China.
Rolls-Royce first passed information to the SFO in 2012 after facing "allegations of malpractice" in the two countries, after which the fraud squad launched a formal investigation.
The company said at the time that its own investigations had found "matters of concern" in additional overseas markets.
KPMG, one of the world's largest accountancy firms, said: "It is important that regulators acting in the public interest should review high profile issues. We will co-operate fully with the FRC's investigation, which follows the SFO's investigations into Rolls-Royce.
"We are confident in the quality of all the audit work we have completed for Rolls-Royce, including the 2010-2013 period the FRC is considering."
The firm has audited Rolls-Royce for 26 years, but is due to replaced next year by PwC.
Rolls-Royce apologised "unreservedly" after the SFO settlement.
The SFO revealed 12 counts of conspiracy to corrupt or failure to prevent bribery in seven countries - Indonesia, Thailand, India, Russia, Nigeria, China and Malaysia.
Often described as "a jewel in the UK's industrial crown", Rolls-Royce makes engines for military and civil planes, as well as for trains, ships, nuclear submarines and power stations.
But in addition to the corruption claims, the company has been hit by a string of profit warnings that sparked a tumble in the share price in the past couple of years. In February, the company reported a record loss of £4.6bn.
Rolls-Royce is holding its annual meeting in Derby, home to its main factory and where it employs 14,000 people.
In a statement ahead of the meeting, chief executive Warren East said estimates for profits and cash flow this year were unchanged, news that will be welcomed by long-suffering shareholders.
"We have some important transformation initiatives under way and, while we have made good progress in our cost-cutting and efficiency programmes, more needs to be done to ensure we drive sustainable margin improvements within the business," Mr East said.
The statement made no reference to the KPMG investigation.