Category Archives: International

International Capital Market

China’s ICBC Opens Account in India

World’s largest lender in terms of market cap is the first Chinese bank to open a branch in India

Industrial and Commercial Bank of China, or ICBC — the world’s biggest lender by market value, has set up business in India, which could potentially open up the market for firms from Beijing, boost investment in infrastructure sectors and foster the growth of a rupee-yuan market. 

The bank will be the first of four Chinese lenders to start operations in India. India and China had signed a memorandum of understanding, or MoU, during Chinese premier Wen Jiabao’s visit, which will facilitate Chinese banks to open branches in India. “We have received a commercial banking licence. In the first stage, we would like to focus on wholesale banking services and products to Chinese enterprises and related parties,” said Sun Xiang, chief executive officer of ICBC, Mumbai branch. The bank, which is now expanding in Europe and other countries, will gradually offer personal banking to local customers and private banking services.

Four Indian banks — SBI, Bank of Baroda, Bank of India and Canara Bank — have a branch each in China. Chinese banks had sought regulatory approval to start commercial operations on grounds of reciprocity.

“ICBC would facilitate the investment of Chinese companies in India’s power, telecom and infrastructure sectors. We would also help companies raise yuan-denominated bonds if there is a demand,” said Yang Kaisheng, president of ICBC. “Corporates can get 3-5 funds by issuing dim sum bonds at an interest cost in the range of 1-3%. A similar issue in India could cost firms an interest rate of 9-10%,” said a treasury head with a private sector bank.

In 2010, China emerged as India’s biggest trade partner with a trade volume of $61.7 billion, which is nearly 20 times of what it was almost 10 years ago, while India is also China’s biggest trade partner in South Asia. ICBC has accelerated its overseas expansion plans. At the end of June 2011, the bank’s overseas assets stood at $140 billion, which account for 4% of its total assets.

“We are still a new comer in the international market when compared to other global players. In future we would like to see the share of international assets go up to 10%,” said Kaisheng. “This would be difficult as our domestic assets are growing faster,” he said.

On potential investments in India, Kaisheng said it would hinge on two factors — the bank’s capital adequacy and the proportion of funds allocated by the head office. “It is true that we operate as a branch instead of a subsidiary. However, as and when regulations demand, we would be open to converting into a wholly-owned subsidiary,” he added.

China’s Stock Bubble Passes Acid Test

CHINA’S stock-market boom is as clear a bubble as you will find, the conventional wisdom says. When might it burst? Nobody knows if it will. The Shanghai Composite Index has surged 45% this year. Just because China has deep pockets in this time of global crisis doesn’t mean its economic health supports this rally. In a sense, buyers are betting on China’s socialist tendencies rather than its success in fostering free markets. Rather than boding well for China’s long-term outlook, this rally serves as a reminder of risks facing the world’s third-biggest economy.

The strength of China’s fiscal position got a headline- grabbing endorsement this week from Nobel Prize-winning economist Joseph Stiglitz. In the same address, though, Stiglitz undermined that argument in the long run. “We are at the end of the beginning, rather than the beginning of the end,” Stiglitz said. “The global economy may be declining at a slower rate and we may see a bottom soon, but it doesn’t mean a full recovery.” Global Downshifting: The rapid growth rates of the mid-2000s are a thing of the past. The downshifting of global expectaions is taking place from New York to Shanghai. Even with the trillions of dollars of stimulus the U.S. is pumping into markets, American households face a multiyear process of saving more and spending less. The $4.4 trillion Japanese economy isn’t much better off. Gross domestic product contracted an annualized 16% in the first quarter, following a fourth-quarter drop of 12%, according to the median estimate of economists surveyed by Bloomberg News.

With the U.K., Germany and much of the euro area in recessions, feel free to engage in the fiction that China’s $3.2 trillion economy will save the world. Stiglitz isn’t wrong to think China will have a better 2009 than other major economies. Its 4 trillion yuan ($585 billion) stimulus plan and record bank lending are helping to fill the void left by plunging exports. The trouble is, that’s a void too far, even for an economy that’s as top-down as China’s. Flawed Assumptions: Be afraid when just about every economist agrees on something. Everyone seems to think China can pull this off that it can artfully influence a vast, underdeveloped economy of 1.3 billion people.

The flaw in this assumption is that it takes for granted that all those stimulus yuan will be spent wisely on worthy projects and companies. It assumes that those investments, much of them funded with debt, will morph into well-paying jobs that generate wealth for China’s people.

It’s hard to know how China can avoid vast amounts of public money being siphoned off by local government officials to speculate on stocks or property. At What Cost: Even if China ekes out healthy growth this year, the question is what it will cost. China may be setting the stage for a Japan-like bad-loan crisis a few years from now. One also has to wonder if China is moving fast enough to rebalance its economy away from exports toward domestic demand.

China’s public-relations machine is working overtime to spin this story. Its success in getting the global media to play along explains why investors are rushing into Chinese shares. Just because China has built a more sustainable bubble, supported by the promise of ever more government largess, doesn’t explain away the challenges facing the fastest-growing major economy. Officials in Beijing will be hard-pressed to replace the role of the U.S. consumer. China’s stimulus efforts are no substitute for demand from American households, which are entering into a rare period of thrift. If you are sitting on big paper profits in China, it may be time to take them.


On The Road? Don’t Miss These 50 Top Shops

The editors of Southern Living pick out their favorite shops from Florida to Texas, Maryland to Mississippi

For Splurges And Special Surprises

1. Neiman Marcus; Dallas, Texas: Visit the first location of the department store icon where high fashion still reigns. 1618 Main St;

2. Tiny Jewel Box; Washington, D.C.: This six-story gem stocks vintage and new jewels, from pearls and diamonds to gold and glass. For the Casual Garden

3. Garden & Home; Pensacola, Fla.: From pots that you can fit in the palm of your hand to gigantic planters as tall as an adult, the assortment of terra-cotta astonishes. 501 N Ninth Ave; 850-439-0640.

4. Garden Deva; Tulsa, Okl.: Find handmade metal furniture and yard art made on-site. 317 S Trenton Ave;

5. Martha’s Bloomers Home and Garden Store; Navasota, Texas: All things garden from seeds and bulbs to pottery and tools fill this great store with a tearoom. 8101 State 6;

6. Eden. A Gift and Garden Store; Nashville, Tenn.: Shop for plants, annuals, and herbs, as well as fabulous outdoor glass baubles and quirky bird feeders to give your garden some personality.

For The Elegant Garden

7. Boxwoods Gardens & Gifts; Atlanta, Ga.: Part nursery and part antiques nook, the ivy-covered cottage boasts garden containers and birdhouses as well as leather picture frames and baby gifts.

8. Southern Homes & Gardens; Montgomery, Ala.: Almost 300 acres brim with plants and decorations, including a 20,000-square-foot shop featuring tree-trimming supplies, holiday china, and collectible ornaments. 3561 Wetumpka Hwy;

9. Garden Architects; Annapolis, Md.: Sophisticated outdoor furniture, water features, and works by Frank Lloyd Wright accent this innovative place. 115 West St; For the Art Aficionado

10. Objects of Desire Gallery; Louisville, Ky.: Contemporary jewelry by international artists keeps company with purses made of unusual fabrics.

11. Tamarack Craft Center; Beckley, W. Va.: Admire the hand-carved furniture, glass, pottery, and Appalachian quilts.

12. Seldom Seen Gallery; Fort Lauderdale, Fla.: Loaded with a variety of mementos from a $1 pocket angel to a $10,000 piece of hand-painted furniture, this institution breaks the normal gallery rules and isn’t a bit stuffy. 817 E Las Olas Blvd;

13. Art & Invention Gallery; Nashville, Tenn.: Located in a former garage, the four-room gallery showcases locally made fine art, handmade jewelry, and whimsical crafts.

14. Square Roots; Decatur, Ga.: Take home a bouquet of daisies and a handmade picture frame from the part flower shop, part folk art emporium. 117 E Court Sq;

15. Beans Ferry Pottery; Fulton, Miss.: Known for his Santa Claus ornaments crafted in the shape of Southern states, artist Keith Carpenter makes this gallery a great gift-giving stopover. 427 Justice Rd;

16. Sans Souci Fine Crafts Gallery; Lafayette, La.: This gallery spotlights the pottery, sculptures, folk art, and furniture of the Louisiana Crafts Guild members, including artist Carol Thibodeaux’s ever-popular gourd roosters. 219 E Vermilion St; 337-266-7999.

For Kitchen Gadgets

17. Star Provisions; Atlanta, Ga.: This 4,000-square-foot chef’s market is a gourmet’s yummy dream with fresh bread, wine, and more than 200 types of artisan cheese.

18. Viking Cooking School; Greenwood, Miss.: This Delta store sells all types of cookware, including kitchen furnishings and grilling gadgets. 325-C Howard St; 662-451-6750.

19. Kiss The Cook; Wimberley, Texas: Situated just off the quaint square in a small Hill Country town, the cooking-supply shop sells knickknacks for a few dollars and cooking equipment in the hundreds. 201 Wimberley Sq;

For Antiques and Furniture

20. Westheimer Antiques Market; Houston, Texas: Look beyond the disarray for armoires, dressers, tables, and more.

21. David Tims Antiques; Cropwell, Ala.: Find a bargain at this warehouse of beautiful antiques where there aren’t a lot of tags but you can bet the prices are all good.

22. Green Front Furniture; Farmville, Va.: This array of converted warehouses and storehouses is filled with furniture. 316 N Main St;

23. Stuart Kingston; Rehoboth Beach, Del.: Family-owned for 75 years, the place stocks unbelievable Oriental rugs and porcelain. 1 Grenoble Pl;

For Local Flavor

24. Fiesta on Main; San Antonio, Texas: The Mexican decorations inside (paper flowers and piñatas) go for cheap, while Talavera pottery fills a courtyard right outside.

25. A’Mano; Mountain Brook, Ala.: A combination art gallery and gift store, it sells everything from folk art paintings to jewelry.

26. South of the Border; Dillon, S.C.: This classic tourist must-stop offers 14 shops crammed with every type of souvenir you’ll never need but want. I-95 at the South Carolina/North Carolina border;

27. Mast General Store; Valle Crucis, N.C.: Since 1883, folks have relied on this legendary spot for boots, rocking chairs, maple syrup, and other staples. State 194;

28. Maverick Fine Western Wear; Fort Worth, Texas: Pad your wardrobe with boots, cowboy hats, and other high-fashion country wear as well as turquoise jewelry.

29. New Orleans Silversmiths; New Orleans, La.: Estate jewelry and a great collection of vintage corkscrews can be found here.

30. McCartys Pottery; Merigold, Miss.: Purchase special trademarked “Mississippi River” plates and bowls at McCartys. 101 S Saint Mary St;

For Home Decor

31. South of Market; Atlanta, Ga.: Make your home a showplace with unique lighting, furnishings, and accessories. 345 Peachtree Hills Ave. NE, Suite 100.

32. Elizabeth Stuart Design; Charleston, S.C.: With a mix of antique, mid-century, and new furniture, chandeliers, pottery, tableware, and pillows, this place is a one-stop spot for your home. 314 King St;

33. Design; Seagrove Beach, Fla.: Its upscale showroom is an interior decorating mecca with an entire room dedicated exclusively to rugs. 4281 E Scenic Hwy 30-A;

34. Wharf Hill; Smithfield, Va.: Antique pieces are mixed with modern home and garden accessories in the town’s original hardware store. 216 Main St;

35. Second Chance; Baltimore, Md.: Salvage remnants from chandeliers to old glass knobs fill a roomy warehouse.

36. R.H. Ballard Art, Rug and Home; Washington, Va.: This small boutique has been known to sell original Matisse lithographs from their basement. It’s a bargain. 307 Main St;

37. Coco & Company; St. Michaels, Md.: From antique and vintage furnishings to private label candles, Coco is known as one of Maryland’s best spots to shop. 209 S Talbot St;

38. De Provence et D’Ailleurs; Blowing Rock, N.C.: The store features home decor items and accessories imported from France, including Provence linens and pottery, glasswork from Biot, and Laguiole knives. And, oui, French is spoken here. 131-8 Morris St; 828-295-9989.

39. NOFO at the Pig; Raleigh, N.C.: Browse eclectic home accessories and gifts such as recipe organizers and pink flamingo lamps.

For Gift Giving

40. International Spy Museum; Washington, D.C.: Visit this awesome museum store for walkie-talkie watches, silk houseplants that have hidden cameras, or safes that look like peanut butter jars.

41. Route 66; Oklahoma City, Okla.: From handmade jewelry to good-smelling soaps to cute clothing, unique finds abound here. 1900 Northwest Expy; 405-848-6166.

42. Hové Parfumeur, Ltd.; New Orleans, La.: French milled, perfumed soaps and fragrances are made on-site.

43. The Villa; Hot Springs, Ark.: Clothing, gifts, and bedding–you’ll get it all. 110 Central Ave;

44. Helix; Athens, Ga.: This eclectic shop sells everything from hand-painted pillows to stylish laptop bags. 146 E Clayton St; 706-354-8631.

45. Bathos; Franklin, Tenn.: Batches of all-natural soaps, scrubs, and masks are mixed here. 416 Main St;

46. Panache, The Aromatique Gallery; Heber Springs, Ark.: Bask in candles, soaps, oils, and other elixirs for the home and body. 3421 State 25 N;

For Clothing and Accessories

47. Lois Gean’s; Magnolia, Ark.: This high-fashion boutique, hidden in small-town Arkansas, draws celebrities and socialites in search of designer finds. 109 S Jackson St;

48. The Tiecoon; Dallas, Texas: Men’s things rule at this small store where you’ll uncover cuff links, watches, money clips, shirts, funky gift items, and, of course, ties.

49. Skif International; St. Louis, Mo.: Try on a few asymmetrical, free-form sweaters made by local designers and fashioned to flatter any shape.

50. Sister Dragonfly; Louisville, Ky.: Snatch up baubles at reasonable prices, including fun rings and silver bangle bracelets.

Web Exclusive: Editors’ Picks

We asked Foods Editor Shannon Sliter Satterwhite, Homes Editor Sara Anderson and Garden Editor Gene B. Bussell to pick their favorite shops in the South. Here’s where they like to shop:

Visit Charleston Cooks! to find everything you need or want in a kitchen. Foods Editor

Shannon Sliter Satterwhite says, “Charleston Cooks! is the all-purpose kitchen shop for any level cook. They have gadgets galore, a great selection of appliances, and Lowcountry food products made by local chefs. You can even take a cooking class or watch a demo to learn more about regional food.”

Simple. Comfortable. Elegant. That’s how Homes Editor Sara Anderson describes home decor store Bungalow Classic in Atlanta. “It’s a really fresh, light, and airy space with an amazing lamp collection,”she says. “It feels relaxed, like a beach house, with all these great finds.”

Garden Editor Gene B. Bussell lists Gardens, a fashion-forward Austin store where plants and design-intensive interior pieces rule, as one of his favorite garden shops. “Where else can you buy great plants, beautiful containers, and smoked chocolate at the cash register? It’s a neat store,”says Gene.