Pesek's View From Asia
Good morning. Here's my take on some of the stories driving the debate in politics, finance and social issues across Asia today:
Doubting China's economic data? Follow Australia's.
Chinese statisticians didn't invent creative accounting, but they sure have given the concept a whole new scale. Case in point: a new report by Peking University's Christopher Balding arguing that China's gross domestic product may be exaggerated by $1 trillion, largely due to flawed housing data. Anyone looking for a reality check may find it 3,500 miles south of Beijing in Australia. As Bloomberg News reports, economists doubting Beijing's data are increasingly following the zigs and zags of China’s biggest iron-ore supplier to judge how well the economy is really doing. Bad news: Reserve Bank of Australia thinks growth isn't likely ``to pick up much, if at all, in coming quarters.''
Malaysia's government may get out of the airline business, and it's about time.
In October 2001, entrepreneur Tony Fernandes did an incredibly gutsy thing: he started an airline in Malaysia, not a place celebrated for encouraging competition. His Air Asia not only thrived, but proved year after year that the government had no business owning more than 69 percent of Malaysian Air. As Fernandes added routes, aircraft and accolades, the state carrier has racked up losses in seven of past nine quarters. Word today from Idris Jala, a government minister and former CEO of the airline, that Malaysia should sell its stake at the right price is great news for investors. Malaysia's economy, too.
North and South Korea renewed talks to open the Gaeseong industrial complex. Sign of hope or another head fake?
No one knows what's in Kim Jong Un's mind, heart or negotiating playbook. But how the cash-strapped 30-ish North Korean leader responds to the South's overtures may offer clues about whether he's serious about opening his isolated economy. So far, optimists who hoped Kim would reverse the disastrous course taken by his late father, Kim Jong Il, have been dead wrong. Reopening the jointly operated factory park would provide Kim the younger with hard currency to improve the lives of his 23 million impoverished people (not to mention line the pockets of his loyalists). Even by the standards of the Kim Dynasty, he would be crazy not to.
Japan's plan to build a giant ice wall to keep radioactive particles from escaping the Fukushima plant has -- surprise! -- drawbacks.
As Prime Minister Shinzo Abe's team rolls up its sleeves to tackle the ``urgent problem'' of nuclear waste flowing into Pacific Ocean, the focus is on constructing an underground containment wall made of ice. Officials are optimistic it will work. But they also admit such an enclosure couldn't be completed until at least 2015, at unpredictable cost. In other words, water contaminated with cesium, strontium and tritium will continue to flow into the ocean in amounts of at least 300 tons a day just 135 miles north of Tokyo. Winter's coming -- just not fast enough.
Is China's smog driving away tourists from the Celestial Kingdom?
Associated Press reports that China as a whole has suffered a 5 percent drop in foreign visitors in the first half of 2013. Beijing, besieged this year by international headlines and television footage of blackening skies, saw an incredible 15 percent plunge. For a reality check on what's at stake, The Economist has a great piece, "The East is Grey," on China's search for a more sustainable growth model. Of all the challenges facing Premier Li Keqiang, none is greater than keeping 1.3 billion from choking on their economic success.
(William Pesek is a Bloomberg View columnist. Follow him on Twitter.)