Wei's Feed
Jun 10, 2011
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Asia’s rich offer slim pickings for private banks

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

HONG KONG — Asia’s rapid growth in private wealth isn’t translating into fat profits for private banks. In fact, margins for managing private wealth are lower for global banks than they were in 2007. Lucrative structured products are less popular now, and the first-generation rich who typify private bank clients in the region demand high returns. That’s tough for the likes of UBS and Citi.

Jun 9, 2011
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China’s forbidden market lures global blue-chips

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

HONG KONG — Though multiple stock market listings are going out of fashion, global multinationals seem unusually eager to float on one exchange that’s currently forbidden to them. Last week Coca-Cola joined other big companies, including HSBC and NYSE Euronext, in expressing an interest in a Shanghai listing when it opens to foreign issuers. For now, capital controls make it tricky and branding benefits look limited. But as long as blue-chips feel compelled to curry favor in Beijing, China may see some good business.

May 18, 2011
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China luxury boom gets new impetus from old bags

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

HONG KONG — No wonder luxury brands like Prada are queuing up to list in Hong Kong. The $35 million initial public offering of Milan Station, a second-hand handbag retailer, has been more than 2,000 times oversubscribed in Hong Kong, setting a new record. Investors are eager to tap into China’s new-money love of old brands. Yet they may be forgetting the risks that go with luxury, like tariffs, counterfeiting and changing tastes.

Apr 26, 2011
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Hong Kong’s yuan IPO buyers should heed history

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

HONG KONG — China likes financial experiments, but they don’t all end in success. The latest yuan innovation may be one of them. Hong Kong’s launch of stocks priced and paid for in the mainland currency, starting with real estate trust Hui Xian, recalls the forgotten “B-share” market, where foreigners could invest directly in mainland stocks. As investors get ready to punt on Hui Xian and its yuan-denominated followers, they should heed history.

Mar 15, 2011
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China can’t afford to abandon nuclear power

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

By Wei Gu

Fears of a nuclear disaster after Japan’s earthquake will harden minds against nuclear power. That could affect China most. The country, already the world’s biggest energy consumer, plans to expand nuclear capacity by seven-fold by 2020. Whatever the risks, it has little choice, if it hopes to cut emissions without sacrificing growth.

Mar 7, 2011
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China’s budget should calm investors in three ways

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

HONG KONG — Chinese premier Wen Jiabao’s weekend “state of the union” speech should calm investors in three ways. Wen pledged that growth would become more sustainable thanks to a focus on social welfare.

Mar 2, 2011
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Chinese Twitter looks cheap versus real thing

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

HONG KONG — China’s Twitter disappointed investors when its owner Sina Corp. said it won’t yet charge fees for the microblogging site. But Weibo still has potential — and makes Sina’s valuation look cheap, especially after the shares fell 5.5 percent in after-market trading. Weibo already has half as many users as Twitter does, but just a quarter of the implied valuation.

Feb 22, 2011
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G20 elicits only half-step forward from China

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

HONG KONG — China has taken half a step forward at the G20. Beijing has agreed, after much wrangling, for trade balances to be included as one of the group’s new gauges of global imbalances. This could be a good sign, if China sees its own trade becoming more balanced. Less encouraging is what Beijing wanted to be left out — including scrutiny of its very imbalanced $3 trillion foreign reserves.

Jan 19, 2011
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M.Stanley falls victim to China’s web “freedom”

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

HONG KONG — For Western banks, doing business in China is never easy. Morgan Stanley just found out the hard way, after the founder of Dangdang launched a foul-mouthed online tirade against the Wall Street firm for undervaluing the Internet retailer’s IPO. The spat is also a reminder that, when it comes to criticising foreign countries or companies, China’s fabled control of the Internet may have its limits.

Jan 11, 2011
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Low expectations should make China do more on yuan

By Wei Gu

The following article is part of Reuters Breakingviews’ e-book, Predictions for 2011. The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

HONG KONG — The Chinese currency rose just 3.6 percent in 2010. As political pressure ebbs and euro zone trouble spreads, traders now expect an even smaller gain for 2011. Beijing has said it wants to make the yuan more flexible. If it really means that, low expectations create a window of opportunity.