Pesek on Asia: Vietnam Gets Big Macs
Good morning. Here's my take on some of the stories driving the debate in politics, finance and social issues across Asia today:
McDonalds hits Vietnam.
Big Macs will soon be available to Vietnam's burgeoning middle class for the first time in two decades. That doesn't mean local entrepreneurs have been waiting around to satisfy consumers' desire for Western names like McDonald’s. Tourists who wanted Starbucks coffee could always find its equivalent at "Starblacks" stores. There also have long been loads of fake 7-Eleven stores and Pizza Inn outlets that look exactly like Pizza Hut franchises. Piraters do brisk business hawking "Hard Rock Hanoi" T-shirts, even though Vietnam doesn't have a Hard Rock Cafe. Still, the return of the golden arches and other icons of globalization is putting the Vietnamese consumer market on a global stage. Not to mention, putting consumers on a trajectory for bigger waistlines.
Do free markets make us fatter?
Speaking of waistlines, a World Health Organization study suggests that unfettered flows of capital and people raise living standards, but also increase our reliance on fast food. The result: an alarmingly rapid increase in obesity rates. Looking at data trends in 25 high-income nations from 1999 to 2008, a research team led by Roberto De Vogli of the University of California, Davis, found a convincing correlation between cross-border fast-food sales and elevated body-mass-index readings. "Unless governments [act]," De Vogli tells the South China Morning Post, "the invisible hand of the market will continue to promote obesity." Fat chance of that.
Sony gets the memo -- finally.
The Japan Inc. icon is finally listening to shareholders. Billionaire Daniel Loeb is only the most vocal member of a group tired of watching Sony lose market share and spew red ink. The company is now cutting another 5,000 jobs as CEO Kazuo Hirai restructures the television and computer units in the face of shrinking demand, and plans to sell its Vaio personal computer business to Tokyo-based Japan Industrial Partners. Promising moves, as these things go. Just as long as Hirai understands that with Sony forecasting a loss for the year, far more remains to be done to catch up with Apple and Samsung and to restore the company to global relevance.
Banker troubles in "Minegolia."
Mongolia's vast store of gold, copper, coal and iron ore -- amounting to roughly $1.3 trillion of resource wealth -- has been hard for nations from China to Australia to resist. Hence the nickname “Minegolia.” But bankers flocking to one of the world's fastest-growing economies don't always fare as well as miners. This fascinating Bloomberg piece by Yuriy Humber details how Credit Suisse and Abu Dhabi’s sovereign wealth fund rushed into Golomt, one of Mongolia’s biggest lenders, and are now clamoring for an exit amid a variety of irregularities. Just a reminder that high-return economies can also be high risk.
Aquino enrages China anew.
Philippine president Benigno Aquino is doubling down on his tough stand against China. But there's a new twist to Aquino's determination to fight China's territorial claims: he's asking for help from the community of nations. “At what point do you say, ‘enough is enough’?" he told the New York Times. "Well, the world has to say it. Remember that the Sudetenland was given in an attempt to appease Hitler to prevent World War II.” OK, so the Hitler reference may be a bit much (the Chinese government called him "ignorant"), but Aquino makes a good point about the need for a multilateral effort to head off Beijing's ever-expanding claims to islands and atolls around Asia. It's worth considering before China announces its next air-defense identification zone or two.
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