The Centre of Expertise on Trade,
Investment and Public Policy

  • Asia House
  • 63 New Cavendish Street
  • London W1G 7LP
  • +44 (0) 20 7307 5454
  • The Centre of Expertise on Trade,
    Investment and Public Policy

    The Week in Asia

    Published On: 15 November 2019

    In The Week in Asia, Asia House Advisory takes a look at the top five developments in Asia this week affecting trade, investment and public policy.

    Join our mailing list and get The Week in Asia direct to your inbox 


    Friday 15 November 2019 


    This week, Alibaba announces its Hong Kong IPO while enjoying record sales, Chinese firm Jingye rescues British Steel and the Philippines’ flagship infrastructure scheme runs into trouble.

    Alibaba announces Hong Kong IPO following US$38bn Singles’ Day bonanza

    Alibaba has gained the required approval from the Hong Kong stock exchange for a secondary listing in the city, through which the company hopes to raise as much as US$13.4 billion. Pricing should be announced on 20 November, and shares are expected to start trading on the week commencing 25 November. The offering would represent one of the biggest fundraisings of the year, and the company is hoping to build on the momentum from their record-breaking sales on Singles’ Day this year, which topped US$38 billion across its platforms.

    Philippines’ flagship infrastructure scheme hits choppy waters

    The Philippines’ ‘Build, Build, Build’ infrastructure scheme, one of President Duterte’s flagship policies, took a hit this week with a new progress report finding that just two of the original 75 planned projects have been completed and only nine others started in the two-and-a-half years since the project was announced. Questions are now being raised as to the viability of the overall scheme, with some senators, such as Senate Minority Leader, Franklin Drilon, calling the scheme a failure. Big-ticket projects, which include new roads and bridges, have been axed from the scheme completely. Despite these setbacks, the government has doubled-down by releasing a new list of 100 projects – costed at more than US$84 billion – of which it hopes to complete 43 by 2022.

    Chinese firm Jingye says it will invest £1.2bn to rescue British Steel

    The Jingye Group, a Chinese manufacturing concern, has agreed to a £70m takeover of British Steel in a move which will save thousands of jobs while giving the group control of a third of the UK’s steel industry. Jingye, which will invest an additional £1.2 billion into the beleaguered steelmaker, said it aims to “preserve thousands of jobs in a key foundation industry for the UK”, but has not yet stated how the current 4,000 employees will be retained. With the deal giving the Chinese firm more than 30 per cent of the UK’s steel sector, concerns have been raised over national security, prompting Business Secretary Andrea Leadsom to claim that there are no “national security issues with this acquisition”.

    Greece and China pen deals including US$660m expansion of key Piraeus Port

    China’s President Xi Jinping visited Greece this week as it seeks to build ties and connections in Europe. The two countries signed 16 trade deals during the visit in sectors as diverse as banking, tourism and solar energy. China’s State Grid expressed its interest in a US$1.1 billion undersea cable being rolled out to Crete by Greek company ADMIE by 2023. The centrepiece, however, was the US$660 million investment by Chinese shipping company COSCO to transform the port of Piraeus into the biggest commercial harbour in Europe. The development could provide a key trade gateway into Europe for China and its businesses as part of the Belt and Road Initiative, which other EU nations have regarded with suspicion.

    Iran announces discovery of new oil field

    President Rouhani has announced the discovery of a new 50-billion-barrel oil field in southwest Iran. Covering an area of 2,400 sq km in Khuzestan province, the discovery could prove to be the country’s second largest oil field, behind Ahvaz, which contains an estimated 65 billion barrels. Iranian oil exports have dropped from more than 1.7 million barrels a day in March to fewer than 500,000 today amid US sanctions, which are in place due to the Trump Administration’s ongoing scepticism over the Iran nuclear deal. Increased enrichment activity was detected in the Iranian underground site of Fordow by the UN atomic watchdog this week – a development that will do little to increase the likelihood of the US relenting.


    Looking ahead to next week, here are a couple of events to watch out for:

    Saudi Aramco IPO due: In what could be the world’s largest listing, Saudi Aramaco’s IPO is due to start trading on 17 November, according to a prospectus released by the company. Sources state that one-to-two per cent could be on offer on the Saudi stock market, though a total valuation of the company remains unknown.

    Japan-South Korea intelligence pact due to expire: The intelligence pact between Japan and South Korea is due to expire next week as the latter announced its withdrawal in August, amid a trade war and dispute over historical grievances between the two countries. The countries’ defence ministers are due to meet on Sunday, while the US is urging the feud to be dropped.


    Asia House Advisory helps organisations understand new operating environments and meet business-critical challenges. Find out more.

    Want to get The Week in Asia direct to your inbox? Sign up to our mailing list and keep up to speed with Asian trade, investment and policy developments.


    Friday 8 November 2019

    This week, Saudi Aramco finally launched its IPO, China signed deals with France and the EU, and RCEP failed to be signed as India pulls out.


    Saudi Aramco launches IPO

    Nearly four years since Prince Mohammed bin Salman (MBS) first presented the idea, Saudi Aramco has finally kick-started its IPO after Saudi Arabia’s Capital Market Authority approved the company’s application for registration. There is hope in Riyadh that the offering, tipped to be the world’s largest, would raise as much as US$60 billion with a sale of up to three per cent of the company. This will depend, of course, on the valuation. MBS hopes a value of US$2 trillion is granted, but banks have tagged the company between US$1.1 trillion and US$2.5 trillion – with the final pricing scheduled for 5 December. The Saudi government plans to sell two per cent of the company in a domestic listing on 11 December, but they will be restricted from offering the planned three per cent on international bourses for a year after this.


    China signs US$15 billion of deals with France during Macron’s visit, other EU-Chinese agreements signed 

    Deals worth US$15 billion have been signed between France and China during President Macron’s visit to the country this week. Deals were struck across a range of sectors, including aeronautics, energy and agriculture. Some highlights include Total’s joint venture with China’s Shenergy Group for LNG distribution in the Yangtze Delta, and Airbus’s promised investment in China, as well as state support for Chinese firms to buy their aircraft. China and the EU also reached an agreement to protect speciality and regional food and drink from imitation. This means that 100 different EU products, including Irish whiskey, Greek feta and Spanish Manchego cheese, as well as an equivalent number of Chinese products, such as Anji white tea and Panji rice, will be protected. It comes after President Xi’s speech at the China International Import Expo, in which he said he hoped to accelerate free trade deal negotiations with the EU, Japan and South Korea.


    RCEP pushed to 2020 as India walk away  

    Talks aimed at getting India to agree to signing the Regional Comprehensive Economic Partnership (RCEP) at the ASEAN summit failed, delaying the signing to 2020 at the earliest. Indian government sources contend that the conditions were “not fair or balanced”, fearing that its economy would be flooded by cheap Chinese products. The deal has proved controversial with certain groups in Indian society, with farmers and trade associations applauding the decision to reject the deal. The other 15 nations, who had concluded negotiations on all 20 chapters and on market access, are planning to continue discussions so that signing could take place in February 2020. If this happens, RCEP would be the world’s largest free trade deal. China hopes to continue discussions with India and get them on board by the end of the year, while other nations are debating whether the deal should go ahead without India.


    China offers incentives to Taiwanese firms, US pushes Taiwan to curb China chip exports 

    China has unveiled 26 measures to further open its market to Taiwanese firms ahead of the presidential election in Taiwan in January. The measures allow Taiwanese firms more equal treatment with their mainland counterparts when it comes to investing in different sectors, such as 5G and civil aviation. With the presidential election weeks away, Taiwan’s Mainland Affairs Council has decried thes moves as an attempt by the Chinese Communist Party to “divide Taiwan internally” and “interfere in and influence Taiwan’s election”. It follows US attempts to push Taiwan to restrict its biggest chipmaker from producing semiconductors for Huawei. Taiwan Semiconductor Manufacturing Company is the world’s largest contract chipmaker and had seen increased business after the US’s blacklisting of Huawei.


    US and China agree to cancel tariffs in phases  

    China has said that an agreement has been made in principle with the US to remove tariffs in phases, noting that it will help to “stabilise market expectations”. Stock markets have responded favourably to the news. This is the first time the US has allowed tariff relief, and Beijing have stepped back from insisting that all tariffs had to be cancelled before a deal could be agreed. The interim deal is also expected to include the US pledge to scrap the tariffs scheduled for US$156 billion worth of Chinese goods on 15 December. Meanwhile, as wrangling over the location of the signing of the “phase one” deal continues, the ceremony itself may be delayed until December.




    Looking ahead to next week, here are a couple of events to watch out for:

    President Erdogan scheduled to meet Trump in the US: Turkey’s President Erdogan is scheduled to meet President Trump in the  US, although a recent vote by the House of Representatives to recognise the Armenian Genocide may jeopardise this. Talks are likely to centre on security and defence issues, particularly relating to the situation in Syria and the Middle East.

    Sri Lanka goes to the polls for its new president: Sri Lanka will go to the polls next Saturday to choose their next president. The choice is between Gotabhaya Rajapaksa, brother of former strongman Mahinda, and Sajith Premadasa, son of a former President. Whoever wins will have to deal with a stuttering economy and whether to continue the current strong relationship with China or sign an infrastructure pact with the US.


    Asia House Advisory helps organisations understand new operating environments and meet business-critical challenges. Find out more.

    Want to get The Week in Asia direct to your inbox? Sign up to our mailing list and keep up to speed with Asian trade, investment and policy developments.


    Friday 1 November 2019

    This week, the APEC Summit cancellation means the US-China phase one trade deal signing will take place elsewhere, big deals were struck on the sidelines of Saudi Arabia’s Future Investment Initiative conference, and India made late demands in RCEP negotiations.


    China invites US to Macao to sign trade deal as APEC summit cancelled 

    In the midst of street protests and rioting, Chilean President Sebastian Pinera has decided to cancel an APEC summit and a UN Climate Change Conference that were due to be hosted in Chile. He cited a need to prioritise solving the crisis currently engulfing the country. The APEC summit, scheduled for mid-November, would have been where the US and China would sign-off on their ‘phase one’ trade deal. Nevertheless, both sides are keen to get the agreement signed as optimism remains high that the deal is close to being finalised, according to the two countries’ trade representatives. It has been reported that China has unofficially suggested Macao as an alternative location for the summit, which will include discussions between President Xi and President Trump to form the backbone of progress towards any follow-up deal.


    Saudi Arabia lands array of deals during FII conference 

    Saudi Arabia’s showpiece Future Investment Initiative (FII) conference took place this week, with five world leaders, heads of the world’s biggest banks and senior executives in attendance. Senior US government figures and executives such as Stephen Schwarzman, Chief Executive of Blackstone – who had pulled out of last year’s FII over the Khashoggi affair – were in attendance this time. The Saudis were able to negotiate a plethora of deals and agreements in the sidelines of the conference, such as Aramco signing more than US$2 billion worth of deals, from investment in oil infrastructure to Artificial Intelligence and data analytics. Agreements were signed with Indian Prime Minister Narendra Modi for Saudi Arabia to provide investments into downstream oil and gas projects in India, as well as Brazilian President Jair Bolsonaro for US$10 billion from Saudi Arabia’s sovereign wealth fund. Brazil was also invited by the Saudi side to consider joining OPEC, to which President Bolsonaro reacted positively.


    Late Indian demands may jeopardise RCEP signing

    Despite having agreed to the terms of the Regional Comprehensive Economic Partnership (RCEP), the Indian government made additional demands this week which may jeopardise progress. The preliminary deal will bring together 16 countries – half the world’s population – and is backed by China and ASEAN. The progress is due to be announced by leaders on Monday during the ASEAN Summit. India has always been a reluctant partner when it comes to RCEP, with strong domestic opposition. Indian demands have included seeking changes in base duties and product-specific rules. However, there is a sense that the government will ultimately come down on the side of agreeing to the deal, as the duties will be phased-out over a 10-20 year time frame.


    US push to reform WTO ‘developing country’ status bears fruit

    South Korea and Thailand have been on the frontline of President Trump’s push to reform the WTO this week. The President’s 90-day deadline for rich countries holding ‘the developing country’ status at the WTO to either drop the status or face punitive trade actions expired last week. South Korea has decided this week to no longer seek special treatment reserved for developing countries during future negotiations at the WTO, joining Taiwan and Singapore. However, other WTO members have not yet budged on the issue, leading President Trump to announce a suspension on preferential trade access on certain products from Thailand. This has affected US$1.3 billion of Thai imports to the US, which has caused the Thai government to declare its willingness to negotiate on the issue.


    Hong Kong now officially in recession, protests have contributed

    Hong Kong officially entered recession this week, as new figures showed Hong Kong’s economy shrank 3.2 per cent in Q3 this year compared with the quarter before. As Q2 had already witnessed a 0.4 per cent decline, it represents a stark deterioration in the economic situation, and puts the city into its first recession for almost a decade. Speaking at Asia House’s Future of Trade Conference this week, Hong Kong’s Chief Executive Carrie Lam stated that the “increasingly violent reality since June is hurting Hong Kong’s economy”. This has been borne out by Hong Kong Tourist Board announcing that tourist numbers to the city have fallen by over a third since this time last year. Mrs. Lam went on to highlight the specific opportunities of the Belt and Road Initiative and increased Greater Bay area integration as “long-term opportunities” that will put Hong Kong’s economy back on track.




    Looking ahead to next week, here are a couple of events to watch out for:

    Thailand hosts East Asia and ASEAN Summits: Thailand is hosting two major regional summits next week: the 35th ASEAN Summit and accompanying East Asia Summit. These will bring together many senior figures from across the region, and will discuss major regional and global issues, as well as the planned announcement of the preliminary version of the RCEP deal.

    China International Import Expo kicks off with keynote from President Xi: China’s showcase event for companies seeking to sell products in China kicks off on 5 November in Shanghai for the second time, with President Xi providing the keynote. Last year’s event saw US$57.8 billion worth of import deals being signed, so the forum represents a major push on the part of the Chinese government to continue encouraging imports, despite the trade war.

    The Asia House Global Trade Dialogue takes place in Singapore: Asia House is convening leading figures from government, business, academia and the media for the next round of The Asia House Global Trade Dialogue, taking place at the Mandarin Oriental Singapore on 7 November 2019. Speakers from Alibaba, Arup, Google, Jardines, Pfizer and Cisco will be among those to participate. Find out more and register now


    Asia House Advisory helps organisations understand new operating environments and meet business-critical challenges. Find out more.

    Want to get The Week in Asia direct to your inbox? Sign up to our mailing list and keep up to speed with Asian trade, investment and policy developments.