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from The Great Debate:

What Beijing can learn from Wal-Mart

“So, how?”

The question, short for “So, how do you want to handle this?” is a common, subtle way to invite someone to offer you a bribe in Asia. A traffic cop pulls you over for running a yellow light. He’s at your passenger window, a leather strap covering his name tag. He tells you to follow him to the police station so he can process your $100 fine. “So, how?”

If you slip 10 dollars into his ticket book -- 20 dollars if you’re a foreigner -- he’ll close it, and you’ll both be on your way.

It’s small scale -- not like the graft that accompanied China’s high-speed rail system -- but it happens all the time in Asia’s developing countries: in traffic, at customs offices, while getting and keeping licenses of all sorts. Nowhere is the bribery problem more severe, and more relevant to the rest of the world, than in China. Three years ago, China's central bank reported that up to 18,000 officials have fled the country since the 1990s, taking some RMB 800 billion ($128 billion) with them. China lost almost $3 trillion in illicit financial outflows -- crooked officials and businesspeople moving their dirty money out of the country -- between 2000 and 2009, according to estimates by Global Financial Integrity, a Washington, D.C. financial watchdog. Because China is the world’s largest exporter, bribery in manufacturing and food production -- and the related quality control issues -- is a global problem.

Wal-Mart is in the news this week for not paying bribes in China -- or at least, that’s the underlying premise in the retailer’s three-year-long struggle with Chinese authorities. On April 13 the Wall Street Journal reported that the Chinese government has fined Wal-Mart $9.8 million for infractions ranging from having the words “net weight” in a too-small font ($486) to botching the genus and species on an almond label ($2,323). China’s domestic companies rarely face such scrutiny.

from Breakingviews:

CITIC’s $37 bln merger hints at SOE reform task

By Una Galani

The author is a Reuters Breakingviews columnist.  The opinions expressed are her own.

CITIC’s $37 billion merger has shed some light on the gargantuan task of reforming China’s state-owned enterprises. The giant conglomerate is merging its assets, which range from finance to football, into its smaller Hong Kong-listed subsidiary. The result combines listed stakes and a mish-mash of smaller businesses. But if all goes well, CITIC Pacific shareholders will get a profitable ringside seat in the cleanup.

from Breakingviews:

WH Group’s quick pork flip serves up meaty return

By Una Galani 

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

WH Group’s quick pork flip will serve up a meaty return. The Chinese pig producer hasn’t had much time to justify the 31 percent premium it paid for rival Smithfield less than seven months ago. Yet the planned relisting of the enlarged group in Hong Kong implies the value of the U.S. business has risen at least 21 percent.

from Breakingviews:

How China is stoking London’s housing bubble

By George Hay

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

It takes a long trip on the London underground to get to the Aura housing development. From Waterloo Station, 42 minutes tick by until you pull into Edgware, the stop nearest to the half-completed apartment blocks being built on land formerly occupied by a now-bankrupt football club. Attempt the journey at the weekend, when large swathes of the tube are typically shut, and you must make a detour to nearby Canon’s Park station. From there, you face a 15-minute trek taking in a boarded-up pub, a Lidl supermarket and a municipal office block with smashed ground-floor windows. In every sense, you are a long way from what estate agents like to call “prime central London.”

from Breakingviews:

China’s car joint ventures aren’t built to last

By Ethan Bilby

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Chinese drivers are booming in number, and foreign auto companies have cruised away with most of the sales. But access to what is now the world’s largest auto market has come with a big financial concession: joint ventures with local partners. Those alliances haven’t fulfilled Beijing’s goal of developing competitive Chinese brands. That divided interest could lead to future break-ups.

from Ian Bremmer:

Alibaba, Weibo and China’s potential for growth

In recent weeks, there has been a surge in Chinese tech sector IPOs -- including Alibaba, Weibo and JD.com -- all planning to list on American exchanges. They’re smart to list away from home: doing so will give them access to more liquidity, and allow them to avoid certain restrictions -- like the rule that companies cannot IPO in China if they haven’t yet turned a profit.

There are also compelling reasons for global investors to get excited about these offerings. China’s domestic consumer market is rapidly growing, and e-commerce is perhaps the most robust segment. There were over 6 billion parcels delivered in China in the first nine months of 2013 -- up a staggering 61.2 percent from the same period a year prior. Online shoppers received half of those packages.

from Breakingviews:

Time to bust China’s “omniscient regulator” myth

By John Foley 

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

China’s clever bureaucrats can no more guarantee the health of the country’s financial system than they can see through walls. It is time to bust the myth of the “omniscient regulator”.

from Breakingviews:

China tech rout sifts IPO haves from don’t-needs

By John Foley 

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Falling prices of internet stocks are a headache for companies yet to join the market. The sell off that began in the first week of March and broke on April 8 hit Chinese companies particularly hard. It may leave investors pickier about coming initial public offerings of tech companies from the People’s Republic. The haves will be sorted from the don’t-needs.

from Breakingviews:

China stock market opening is opposite of Big Bang

By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

China’s approach to opening up its stock market is the opposite of a Big Bang. Investors are once again getting excited about the prospect of mainland shareholders being allowed to buy Hong Kong stocks. But such hopes have proved premature before. As with any loosening of China’s capital controls, progress is bound to be gradual.

from Breakingviews:

Alibaba shopping spree needs better explanation

By Robyn Mak

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Alibaba’s shopping spree needs better explanation. The Chinese e-commerce giant has spent $3.8 billion on acquisitions and investments since 2013. The land grab may excite prospective investors ahead of its long-awaited initial public offering (IPO). But Alibaba will eventually have to justify its purchases.

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