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Tuesday May 29, 2018

At a Glance

Huawei in PolandIN April and the fi rst two weeks of May, Chinese tele-com company Huawei has overtaken Samsung to become top smartphone seller in Poland, recent reports said.

According to third-party market research company GfK, Huawei’s smartphone market share in Poland reached 36 percent and 34 percent respectively in April and the fi rst two weeks of May, nearly 10 percent higher than Samsung in second place. According to GfK, compared to the same period of last year, Huawei’s market share in Poland increased around 13 percent. Zhang Jian, director of Huawei CBG Poland, said this was the fi rst time that Huawei managed to take the leading position in Poland since 2004 when Huawei entered the market.Mobile payment BANKS posted robust growth in mobile payments in the fi rst quarter of this year, according to the People’s Bank of China.

Banking institutions handled 70.8 trillion yuan (US$11.1 trillion) in mobile payments in the period, up 16.8 percent year on year, the central bank data showed. Around 10.7 billion payments were made through the banks’ mobile services in the fi rst quarter, an increase of 17.8 percent year on year, the central bank said.DiDi expansionDIDI Chuxing, Chinese on-demand mobility giant, has expanded its food delivery service to Nanjing to tap the growing online-to-offl ine market.

The company’s food deliv-ery business, DiDi Foodie, will start operations in the capital city of East China’s Jiangsu Province, on Friday. Industrial data showed that China’s food delivery market volume reached about 204.6 billion yuan last year, up 23 percent year on year. It is expected to reach 400 bil-lion yuan this year.

CHINESE consumer demand for foreign foodstuff, cosmet-ics and automobiles is strong, two surveys by the Commerce Ministry showed yesterday, and local distributors plan to ramp up orders from overseas suppli-ers in the next 12 months.

Nearly a third of the around 1,400 consumers surveyed said they were planning to buy more imported merchandise over the next six months, especially cosmetics, watches and glasses, baby products, passenger cars and jewelry, the Commerce Ministry said.

Foreign passenger cars are in high demand, the ministry said. More than 30 percent of the consumers who responded to the question of whether they would buy more foreign autos said they were keen to in the next half year, particularly SUVs and new energy vehicles.

China is looking to boost domestic consumption amid signs of slowing momentum in the world’s second-largest econ-omy. The survey results would also be welcome news to global brands looking to deepen their presence in China, particularly

in the country’s inner cities.In the survey, 38 percent of

consumers who responded to the question on cosmetic pur-chases said they were planning to buy more foreign brands over the next six months, while three quarters of them said the domestic skin care market was not meeting current demand.

In December, China cut import taxes on almost 200 consumer products includ-ing food, health supplements, pharmaceuticals, garments and recreational goods to 7.7 percent on average from 17.3

percent. Import duties on cer-tain cosmetics were halved to 5 percent.

Among the more dramatic cuts were tariffs on milk powder and diapers, where taxes were slashed to zero percent. An overwhelming majority of consumers said they intended to keep buying foreign milk powder and diapers, or even buy more.

Filming equipment, air purifi ers and electronic tooth-brushes and robotic vacuum cleaners were in short supply in the Chinese market, according

to a third of the respondents.The second survey of a

thousand distribution compa-nies showed “relatively strong appetite” in boosting imports, the Commerce Ministry said, particularly in food, cosmetics, watches and passenger cars.

More than 10 percent of fi rms surveyed said they would import more wines, fruits, beers, heath supplements, fra-grances, skin care and makeup over the next year.

They were also keen to boost imports of new energy cars, SUVs and sedans. (SD-Agencies)

Demand for foreign autos, cosmetics robust: surveys

DEBT growth for Chinese compa-nies has slowed to the lowest rate in more than a decade, according to latest analysis, which would provide relief for policymakers worried about the fallout from years of loose lending practices.

The overall debt levels of Chinese companies grew 3 percent in the fi rst quarter of this year, according to analysis of 1,843 fi rms listed in Shang-hai and Shenzhen, the slow-

est pace in at least 13 years.Combined total debts —

including borrowing via loans and bond issuances — amounted to 13.2 trillion yuan (US$2.1 trillion) at the end of March, the slowest pace of growth year on year since at least 2005, the analysis showed.

That amount was down 6.2 percent from the fourth quarter of the year, a steep drop after companies ramped

up leverage during 2017.Revenue growth, meanwhile,

more than halved to 12.3 per-cent in the fi rst three months of 2018 from 26.7 percent a year ago. Net profi t margins were also squeezed to their lowest level in two years, with sectors like information technology particularly hard hit.

The government is in the third year of a regulatory crackdown on riskier lending practices,

which has slowly pushed up borrowing costs while reducing these alternative and murkier funding sources for companies such as shadow banking.

China’s overall debt level rose 2.7 percentage points in 2017 to 250.3 percent of gross domestic product due to the impact from China’s supply-side reforms, improving economy and corpo-rate profi ts, the central bank has said. (SD-Agencies)

Companies’ debt growth slows to lowest rate in a decade

A car owner charges up his electric car at a charging station in Xiamen, Fujian Province, in this fi le photo. Morgan Stanley is seeing rising demand for its wealth management services from the emerging rich in China’s second-tier cities like Xiamen, Fuzhou and Dongguan. Xinhua

MORGAN Stanley, which runs the world’s third-largest private bank, expects healthy growth in its Asian wealth operations this year, fueled in part by business from deal-makers and entrepreneurs in China’s smaller cities.

The New York-based bank is seeing rising demand for its wealth management services from the emerging rich in China’s second-tier cities like Xiamen, Fuzhou and Dong-guan, said Vincent Chui, who heads Morgan Stanley’s wealth operations in Asia. Many are entrepreneurs cashing out of their businesses and seeking help investing the proceeds overseas, he added.

“The quantum of growth of China’s economy is moving away from the coastal tier-one cities, to the second-tier cities. It’s just the way the economy is growing,” Chui said in an interview. “Wealth generation follows that trend.”

China has been minting bil-lionaires at a faster rate than the United States, drawing the attention of private bankers at fi rms like Morgan Stanley, UBS Group AG and Credit Suisse Group AG. The U.S. bank has teams in Singapore and China’s Hong Kong dedicated to man-aging the offshore wealth of Chinese clients.

“Without a doubt, China is the biggest driver, not just in terms of the magnitude, but also in terms of the rate of

Morgan Stanley sees smaller cities driving wealth gains

growth,” Chui said, referring to Morgan Stanley’s business serving Asia’s rich. “I am very constructive on the outlook of 2018 for the ultra high net worth wealth business in this part of the world.”

In the past, China’s bil-lionaires came mostly from established cities like Beijing, Shanghai and Guangzhou. One example of the growing wealth in the second-tier cities comes from Xiamen, in Fujian Province, where Cai Wengsh-eng and Wu Xinhong became billionaires after listing their beauty-enhancing selfi e app company Meitu Inc. in Hong Kong.

Morgan Stanley targets wealth clients who are “active”

owners of businesses or assets, Chui said. They are more likely to seek help with transactions such as listing their com-panies overseas or hedging their international portfolios, thereby allowing the bank to cross-sell them its investment banking and other services, Chui added.

Beyond China, Morgan Stanley is getting more wealth management business from rich people in Thailand, the Philip-pines and Singapore, Chui said. The bank’s wealth assets in Asia rose at a double-digit pace last year, and may exceed that rate in 2018, he said.

Morgan Stanley is placed seventh among Asia’s 20 larg-est private banks, according

to publication Asian Private Banker, which put its Asian assets under management at US$102 billion last year.

Chui said he expects head-count to rise by 15 percent to 20 percent this year in Singa-pore and China’s Hong Kong, as he adds relationship managers to serve new clients across the region. That would add to the roughly 100 relationship man-agers which Morgan Stanley had in Asia last year.

UBS and Bank of America Corp. run the world’s largest private banks, followed by Morgan Stanley, according to the Scorpio Partnership. It put Morgan Stanley’s total assets under management at US$1.95 trillion last year. (SD-Agencies)