'This is not supposed to happen': Experts on DBS, Citi outage caused by data centre failure

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NEEDED Files, Healing Programs

Due to the significance of the data center, banks generally have a storage facility. Additionally, some businesses have two information centers that simultaneously share the load. If one fails in like circumstances, the different can make up the difference.

There are typically several levels of redundancy for mission-critical applications like banks, according to Dr. Dennis Khoo, managing partner at online firm allDigitalFuture. & nbsp,

According to Dr. Khoo,” In the majority of advanced banks, using the most recent technologies, the database may be quickly replicated, which means they will have a main site and an alternate site, and the data is duplicated suddenly on both sites.” & nbsp,

According to the Singapore Computer Society, the majority of data centers are built with real-time repair capabilities and some degree of reliability. They are also particularly constructed, according to the company, to match the precise duplication requirements of the business.

To reduce potential customer disruption, the world added that a files center’s typical uptime guarantee would typically be 99.982 %. & nbsp,

But, there is still 0.018 percent of outage that could occur. In order for their crucial IT systems and data information to quickly failure to the supplementary data center in the shortest amount of time if such an incident happen, the client may establish an effective Business Continuity Management System and IT Disaster Recovery Plan.

WHAT CAN Businesses DO IF THE Information Areas ARE DOWN?

However, if all data centers fail, there isn’t much — if any — service a bank can offer. & nbsp,

Banks activate what they refer to as” offline mode ,” according to Dr. Thng, which means they provide some services at branch offices using what is available. When the information center is restarted, these purchases are finally updated with the server. & nbsp,

These services may include money deposits, transaction instructions, and credit card transactions, as banks have extra cash on hand. DBS reopened departments to assist customers with some companies. & nbsp,

Dr. Thng claims that everyday This incidents like processing delays happen. Some of these go unrecognized by clients. However, company outages will harm the company’s reputation and possibly have economic repercussions. For instance, if a client receives late fees because they were able to pay their bill on time due to an outage, they may also cause financial losses. & nbsp,

Dr. Khoo claimed that banks would own” broken” their support commitments to offer customers around-the-clock service in terms of social impact.

Therefore, it is certain that your reputation will suffer as a result of your inability to provide excellent customer service. And this is not supposed to happen with suitable style. “& nbsp,

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China-Philippines testing the waters of a short sharp war

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After their canoes collided on October 22 close to the contentious Second Thomas Shoal in the roiling South China Sea, the Philippines and China are literally on incident program at water. As political tensions flared in a maritime region with significant political stakes, both edges blamed the other for the event.

A BRP Sierra Madre grounded vehicle island on the Second Thomas Shoal was about 25 kilometers east-northeast of the collision of a China Coast Guard vessel at approximately 6:00 am on Sunday. A Spanish task force reported the incident. It asserted that the Filipino team was in danger due to China’s” controversial, careless, and illegal action.”

The two Spanish provide boats and two beach guard ships entered disputed waters and were allegedly transporting” illegal creating materials” to warships, according to a statement from China’s international ministry.

According to China’s declaration andnbsp, the collisions happened after the Spanish boats disregarded warnings and approached Chinese vessels in an uncomfortable way. It stated that” the responsibility lies entirely with the Philippine side ,” which gravely broke the international maritime collision – avoidance rules.

Beijing claimed that” our operations were professional, standardized, legitimate, and legal ,” and that its coast guard ship” intercepted the trespassing Philippine ship in accordance with the law despite numerous ineffective warnings.” The rules to which the speech was referring was not specified.

vehement and serious charges

Military officials from the Philippines have from entered the rhetorical altercation.

Soon after a collision at sea between Philippine and Chinese coast guard forces at the hotly contested Second Thomas Shoal, Philippine National Security Adviser Secretary Eduardo Ano declared,” We will not be deterred and we will continue to resupply our troops in BRP Sierra Madre ] grounded vessel ] despite provocations. & nbsp,

Near the contentious feature, Vice Admiral Alberto Carlos, commander of the AFP’s Western Command( WESCOM ), directly blamed China for the conflict while stating that” our resupply sorties have always been regular and routinary.”

He claimed that his soldiers handled” Chinese vessels” harmful maneuvers with the utmost professionalism, ability, and patience to prevent any mishaps or unfavorable incidents.

A Philippine flag flutters from BRP Sierra Madre, a dilapidated navy ship that has been aground since 1999 and is now a Philippine military detachment on the disputed Second Thomas Shoal, part of the Spratly Islands, in the South China Sea. Photo: Reuters/Erik De Castro
BRP Sierra Madre, a decrepit navy ship that has been grounded since 1999 and is now the Spanish government detachment on the contentious Second Thomas Shoal in the South China Sea, is fluttering with the symbol of the Philippines. Erik De Castro, Reuters, and Asia Times Files

Meanwhile, newly appointed PCG Commandant Admiral Ronnie Gil Gavan criticized China for acting” provocatively, irresponsibly, and recklessly ,” while highlighting the Philippines’ resolve to prevent” escalating tensions.”

The Philippine Navy ( PN ) and the Philippine Coast Guard ( PCG) collaborated on a resupply mission to the grounded BRP Sierra Madre, which serves as the country’s official base on the Second Thomas Shoal.

According to an arbitral tribunal’s decision at the Hague in 2016, the Second Thomas Shoal cannot legally be claimed as a territory by China, whose expansive nine – dash line claim was nullified on the legal basis of the United Nations Convention on l’Ocean Sea ( UNCLOS ). This is due to its low tide elevation within the Philippines’ exclusive economic zone ( EEZ ).

China is obviously testing the waters in the South China Sea as the US appears to be mired in numerous problems in Ukraine and then Israel.

The Eastern power wants to terrify the Ferdinand Marcos Jr. administration, which has turned up to American allies in rebellion of Beijing’s earlier objectives, in addition to reiterating its broad claims.

As a result, there are growing concerns that China might use quick, decisive dynamic operations to restore control, impose its will over the disputed waters, and suppress the Philippines’ escalating issue contested lands.

Important allies, including the US, are coming to Manila’s linguistic security in response to growing worries about an armed conflict.

According to US Ambassador to Manila MaryKay Carlson on X, formerly known as Twitter,” the United States condemns China’s latest disruption of a legal Philippine resupply mission to Ayungin Shoal [ Second Thomas Shoals ] putting the lives of Filipino service members at risk.” She continued,” We stand with our # FriendsPartnersAllies in defending [ Philippine flag ] sovereignty and in support of a # FreeAndOpenIndoPacific.”

In a separate speech, the US State Department reiterated that the” 1951 US-Philippines Mutual Defense Treaty extends to military attacks on Spanish military personnel, people vessels, and plane– including those of its Coast Guard — anywhere in the South China Sea.”

Under the Philippine-US Enhanced Defense Cooperation Agreement( EDCA ), there are growing concerns in Asia about America’s wherewithal and ability to restrain Chinese assertiveness in nearby waters. This is true even in the face of strong assurances from Washington and an expanding military presence on Philippine soil by the Pentagon.

President Joe Biden insisted last week that the US does wage war in numerous conflict zones to support allies all over the world in a significant conversation. In the midst of the continuous military activities in Gaza, he requested further security assistance of US$ 61.4 billion to help Ukraine against Russia and$ 14.3 billion for Israel, maintaining that” American administration is what keeps the world up.”

Israel has benefited from more than$ 300 billion since its founding, while Ukraine received nearly$ 47 billion in defense aid from Washington alone last year.

A Brief, Sharp War

Regarding the Indo-Pacific, Biden requested only$ 2 billion in additional revenue, underscoring the Pentagon’s difficult return to conventional theaters of worry, especially the Middle East and Europe.

Since the Pentagon has repeatedly cited China as the greatest threat to US global leadership, many analysts were perplexed by America’s apparent new defense priorities & nbsp. According to a recent Pew Research Center survey, up to 50 % of Americans believe China to be the US’s biggest physical threat.

Due to their extremely minimal defence capabilities against China, US allies like the Philippines are now in a specially precarious position. The total defense assistance provided by the US to the Philippines since 2015 has been around$ 1 billion, the highest amount in the area but a pitiful sum in comparison to that provided to allies in other theaters.

Marcos Jr. has gradually embraced increased defence cooperation with the Pentagon since taking office last year in an effort to thwart Beijing’s aggressive actions. The Filipino president has increased his hope in an American security umbrella under an expanded EDCA after failing to secure any significant compromises on the marine issues during his journey to Beijing earlier this year.

Marcos Jr. properly injected the Philippines into the Taiwan issue by allowing the US government exposure to prized bases in the northern provinces of the East Asian country, much to China’s dismay and shock.

Beijing properly soon push the envelope further in the South China Sea, having been frustrated by Manila’s more confrontational stance but presently probably encouraged by the potential strategic overstretch of Washington.

The possibility that China will strategically engage in targeted battles, as it did with India in the Himalayas in recent years, to reinstate its will over the Philippines is causing growing concern in Asian security lines.

The Asian superpower has long relied on a” salami slicing” or” cabbage” strategy to increase its influence in the South China Sea, always avoiding direct military conflict or inciting the US-Philippinese mutual defense agreement.

Smaller competitors of China have had trouble responding to its” black zone” threats, particularly its increasing reliance on militia-driven swarming strategies. However, they now appear to need to get ready for possible small-scale but terrible conflicts.

Taiwanese ships can be seen anchored at the Whitsun Reef on March 23, 2021, about 320 kilometers north of Bataraza on the South China Sea area of Palawan in the Philippines. Asia Times Files, Handout, and Satellite Image, 2021 Maxar Technologies, AFP

According to some analysts, China may now be tempted to wage a” little sharp war” against some of America’s Eastern friends due to the extraordinary circumstances.

There are two isolates in Chinese corporate culture, according to eminent naval planner James Holmes. One favors a long conflict, while the other values an immediate, resounding victory. Mao Zedong’s experience can be placed on the past, and Sun Tzu is placed upon the former.

The Philippines’ resolve to renovate its place in the Second Thomas Shoal and its growing presence in supporting America’s deterrent strategy over Taiwan have possibly increased Chinas’ appetite for risk.

China has made it clear that it will use force if necessary if the Philippines remain with its ostensibly” provocative” activities, starting with ongoing work to renovate the BRP Sierra Madre and possibly allowing US military access to the country’s northern bases near Taiwan. & nbsp,

The Philippines and China may soon transition from maritime collisions to a short-term, strong war, with significant repercussions for peace and stability in the Indo-Pacific, absent any significant political find or stronger US sign of assistance.

Follow Richard Javad Heydarian at @ RicheyDarian on X, formerly Twitter.

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US-China relations have stabilized, but in permafrost

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The likely meeting between Chinese Communist Party General Secretary Xi Jinping and US President Joe Biden on the sidelines of the APEC summit in San Francisco in November supports hopes of a “thaw” in US-China relations this year. Biden predicted such a thaw earlier this year and some observers believe they see an upturn.

The outlook is less optimistic, however, if we assess the current state of the relationship from a longer historical perspective. For several decades, US relations with the People’s Republic of China (PRC) followed long cycles featuring high climbs and deep descents.

During the Korean War in the 1950s, the relationship reached a nadir with Chinese and American soldiers killing each other in battle. For years afterward, Washington remained deeply hostile toward China, viewing Mao’s regime as aggressive and irrational.

The 1970s, however, saw US President Richard Nixon’s visit to China, PRC paramount leader Deng Xiaoping’s visit to the US and the establishment of normal diplomatic relations. 

Another serious downturn followed in 1989 with the Tiananmen Massacre. But in 1994 the relationship had recovered to the point where US President Bill Clinton de-linked the renewal of China’s Most Favored Nation trade status from the PRC government’s human rights record. 

Relations weathered the shocks of the Third Taiwan Strait Crisis in 1995-96 and the bombing of the Chinese Embassy in Belgrade by US aircraft in 1999. Clinton’s government granted China Permanent Normal Trade status in 1999, and China joined the World Trade Organization in 2000 with Washington’s support. 

A bilateral crisis intervened in 2001, resulting from a collision over the ocean near the Chinese coast between a US surveillance aircraft and a recklessly maneuvering PRC fighter aircraft. The Chinese pilot died, and the PRC government imprisoned the US aircrew for 12 days while demanding an apology from Washington. Some members of Congress said the Chinese were taking “hostages” and deserved no apology.

Yet three years later, US-China relations had improved to the point where US Secretary of State Colin Powell called the relationship “the best we’ve had in 30 years.” Shortly thereafter, US Deputy Secretary of State Robert Zoellick articulated the American vision of China as a “responsible stakeholder.” A US official making such a statement today seems unimaginable.

That was the last multi-year high point before the Xi Jinping era began in 2012. Xi has presided over an era of steady decline in the bilateral relationship, marked by irritants such as China’s construction of military bases in the South China Sea, Chinese “Wolf Warrior” diplomacy, the Covid-19 pandemic, tensions over Taiwan, Chinese economic coercion against trade partners that are US friends and allies, PRC government-sponsored cybertheft, the Chinese spy balloon furor, US attempts to stop China from getting advanced technologies and Beijing’s pro-Russia position on the Ukraine war. 

Importantly, the Xi era simultaneously saw China attain a level of military capability that forced Americans to begin to see the PRC as a peer competitor.

Chinese President Xi Jinping reviews a military display of Chinese People's Liberation Army (PLA) Navy in the South China Sea on April 12, 2018. Photo: Reuters/Li Gang/Xinhua
Chinese President Xi Jinping reviews a military display by the Chinese People’s Liberation Army Navy in the South China Sea on April 12, 2018. Photo: Xinhua

Before Xi, the relationship was volatile in the sense of high mobility between cordial and hostile. The positive aspect of this volatility was the expectation that when relations were poor, eventually they would recover.

If US-China relations were a stock bought at US$50 per share, sometimes the value would go down to $30, but you could depend on it eventually bouncing back to $75. 

Now, however, as a consequence of large, irreconcilable conflicts in the two governments’ vital interests, the scope for dramatic improvement in China-US relations is far more limited than prior to the Xi era. 

The relationship is stable rather than volatile, but it has stabilized at a low level of quality, locking in poor bilateral relations for an extended period. The $50 stock may be stuck at $25 indefinitely. And it may drag down the rest of the stock market.  

To be sure, the two countries have taken some steps this year to improve their relations. They’ve established working groups on economic and financial issues. In September, the PRC government assisted in the return of fugitive US soldier Travis King from North Korea to the US, earning thanks from the White House. 

Several recent Chinese moves might be signals of goodwill with broader implications: the release of Australian journalist Cheng Lei after three years of imprisonment on questionable grounds, an agreement to cooperate with Western institutions in restructuring Zambia’s debt and an invitation to the US to send delegates to the Xiangshan defense forum in Beijing, China’s knock-off of Singapore’s annual Shangri-La Dialogue. 

These mostly procedural and atmospheric steps are pathetically minor, however, compared to the substantive and intractable problems that still divide the PRC and the US.

On October 17, for instance, the US Department of Defense accused China of “a centralized and concerted campaign” of harassing US and allied aircraft in international airspace near China, also releasing a collection of photos and videos apparently showing Chinese fighter aircraft flying dangerously close to US aircraft. 

Harassment missions by PRC aircraft and ships reflect both China’s disregard for some aspects of international law and Beijing’s insistence that other countries accord China a sphere of influence. Fundamentally, Beijing wants to replace US “hegemony” in the western Pacific with PRC pre-eminence. PRC public diplomacy daily condemns US global leadership, US regional influence, and US alliances.

Thus far, Washington shows no interest in re-trenching. Even four years of Donald Trump, who openly disparaged US alliance relationships and seemed inclined to follow a Jacksonian foreign policy, made hardly a dent in the well-established US posture of forward deployment in the Asia-Pacific.

Washington continues to challenge China’s claim of ownership over most of the South China Sea through diplomatic protests, “freedom of navigation” operations by US ships and aircraft, and support for pushback against Chinese claims by countries in the region. 

Taiwan, as well, remains a flashpoint over which neither side will yield. Absent an agreement on their respective policies toward Taiwan, Washington and Beijing are trudging, zombie-like, toward an eventual cross-Strait war, as each tries unsuccessfully to warn off the other by making military preparations.

China demands that America return to the pre-Xi posture of heavy economic engagement and technological collaboration with minimal restrictions. That is no longer possible given US disillusionment with the Xi regime.

The pandemic subsequently supercharged this sentiment, as Americans learned how concretely vulnerable they were to Chinese-produced goods that might suddenly become unavailable either because of economic disruption in China or because of intentional Chinese economic coercion. 

The clincher is a bipartisan commitment in the US to curtail cooperation, whether technology transfer or investment, that might enable PRC foreign policies that undercut US interests.  

Any possible US-China thaw can be extremely fragile, as we saw in June of this year. Days after the successful talks in China by his secretary of state, Biden remarked off-handedly that Beijing overreacted to the US shooting down the Chinese spy balloon because it caught Xi by surprise, and “That’s what’s a great embarrassment for dictators, when they didn’t know what happened.” 

US sailors fish the collapsed Chinese spy balloon out of the Atlantic off South Carolina. Photo: US Navy

Biden was seemingly defending China against the hardline US view that Xi dispatched the balloon as an intentional humiliation of the US. Nevertheless, the PRC government responded angrily, saying Biden’s remarks were “ridiculous and irresponsible” and “seriously violate[d] basic facts, diplomatic protocol and China’s political dignity.” 

Biden’s take reflected a highly plausible interpretation of the incident, but Beijing objects to Xi being called a “dictator” even though this description is factually correct.

Those who expect that a Xi-Biden meeting in San Francisco will cause a breakthrough should recall that Biden and Xi had a similar face-to-face meeting a year ago in Bali. That meeting paved the way for several US cabinet members to visit China, but otherwise did nothing to solve the big issues causing bilateral friction. 

Although the two leaders agreed in principle that a zero-sum relationship and a new cold war are undesirable, each government subsequently continued to blame the other’s policies for causing problems.

In this new stability, thaws will be more modest and less frequent. US-China relations are becoming more like US-North Korea relations, where a poor bilateral relationship is so ossified that hopeful observers get over-excited about a meeting between officials. 

Denny Roy is Senior Fellow at the Honolulu-based East-West Center.

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Commentary: When it comes to bank outages, convenience favours the prepared

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If history is any indication, the response to the most recent disruption will follow a three-track pattern: Customers will gripe about the inconvenience and question whether Singapore could go digital, banks may be forced to review their administrative procedures and system resilience, and the authorities may slap the violators with additional requirements and demand that they perform better.

Everything you’ve said is entirely reasonable and comprehensible.

Without a doubt, the banks — all of them, not just the two parties — will benefit from this. They should double down on duplication systems, increase their situation planning, and develop in better public relations and client recovery.

It is impossible to predict when another interruption may occur. No technological method is perfect, upon both.

A BETTER Digital Culture IS MISSING A LINK?

This will be viewed as a significant learning opportunity from sage social strategy to being digital. However, I wonder if society, including you and I, sees ourselves as a part of the entire digitalization process rather than just consumers. This would be the missing piece of information that would make the digital system function better. & nbsp,

Singapore has made great strides toward becoming a digital society. The nationwide campaign to reduce cash transactions began in 1985, even though the popularity of digital banking and digital transactions has only definitely increased recently.

In a statement delivered on March 14, 1985, Lee Yock Suan, the acting secretary for Labour, stated that the widespread adoption of electronic fund transfer systems and the popularity of digital transactions may show in’ a new period of comfort and convenience’ in banking and cash management services. ” We can anticipate the day when we can shop, pay our bills, check our bank accounts, and transfer money between accounts all from the comfort of our homes ,” said & nbsp.

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DBS, Citi outage: MAS orders banks to conduct thorough investigation, supervisory actions to follow

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Business online banking recovered only after 7 p.m. on Saturday, and the majority of ATMs were operational by around 8. DBS announced on Thursday that its services had been gradually restored. 30 p.m. & nbsp;

” We have statistics centers all over the island and strong business treatment plans in place. According to a DBS voice, the swift heat of the data center in this case resulted in an abrupt closure of our techniques, which delayed the full healing process.

All services were completely restored by Sunday morning, according to a Citibank director who spoke on Wednesday. & nbsp;

” We have now recovered all programs and tested all functionality, and we are still working with regulators as necessary.”

The resilience of our system is highly valued by Citi, and we will use the lessons learned from this event to keep getting better. We want to thank our clients for their tolerance and understanding, the institution said. & nbsp;

Have cash and use other payment methods.

According to MAS, banks are expected to enter into contractual agreements with data center providers that include its requirements for technique availability even though it has no control over data centers. & nbsp;
 
All banks must make sure that” their critical systems and services to customers are resilient to disruption ,” the authority continued. & nbsp;

Aside from the cap on the amount of time spent in unscheduled downtime ,& nbsp; Backup data centers and devices must be installed in banks.

To make sure that crucial devices and services can be repaired within four days of an interruption, the MAS advised them to check them on a regular basis. & nbsp;

When DBS and Citibank’s main data centers didn’t operate as expected on Saturday, MAS acknowledged that both had activated their backup files facilities. & nbsp;

Both, however, were still unable to fully restore their techniques in the allotted time.
 
Banks and customers may have backup plans in case of service disruptions brought on by That outages because no This system is faultless, according to the MAS. & nbsp;
  
To lessen the impact on consumers, the banks” activated contingency steps ,” according to MAS, such as extending branch hrs and making alternative arrangements for credit card transactions. & nbsp;

Users can gain from using different payment methods and having some cash on hand as a backup. Some affected customers with alternative payment options were able to move to those or to using money during this new service disruption, which reduced trouble. “”

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Tanglin Halt rejuvenation to see integrated development with new hawker centre, polyclinic

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Former Tanglin Halt residents relocated to the nearby Dawson estate after the & nbsp estate was chosen for redevelopment in 2014. With 3,480 households involved, this Selective En bloc Redevelopment Scheme ( SERS ) exercise was the largest to date, according to HDB.

The strategies add more foliage and improve communication for pedestrians and cyclists between Commonwealth MRT Station and the Rail Corridor in addition to fresh amenities and services for citizens.

OVER 2 Aspects DEVELOPED

On the site of the former Tanglin Halt Neighbourhood Centre, which housed the previous Commonwealth Drive Food Centre and the present-day Tanglingin Hant Market, the new included creation will be situated.

According to HDB, the majority of Commonwealth Drive Food Center stallholders have moved to SkyResidence @ Dawson’s new Margaret Drive Hawker Center.

The integrated growth may be built in two stages to minimize disruption to stallholders in Tanglin Halt Market, which is still in operation.

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Didi, Huawei lead the way for a China bounce back

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If ever there were a business story proving the folly of sanctions in today’s hyper-integrated world, it’s Huawei and the runaway success of the Mate 60 Pro smartphone it unveiled last month.

For years now, Huawei has been central to US efforts to stymie Chinese tech development. Since 2019, when Donald Trump was in the White House, Huawei has been on Washington’s “Entity List.” That greatly limited the Shenzhen-based company’s access to key technology, essentially knocking it out of the smartphone game.

Well, not so much. “This is a breakthrough for Huawei, which has not been able to produce a 5G mobile phone since 2020 and has seen its once-commanding global market share shrivel to basically zero,” says analyst Tilly Zhang at Gavekal Research.

“It’s led to fierce debate over the efficacy of the US measures,” Zhang says, “with boosters in China and critics in the US claiming that the new phone shows the sanctions are ineffective and that China has already overcome them.”

In reality, Zhang says, “it’s more of a symbolic victory for Huawei that will not fundamentally change the trajectory of China’s technology sector under US sanctions.”

And yet it’s also a strong case study not just of Beijing’s ability to steer around trade curbs, but also of what China Inc needs to do to raise its game.

Didi Global is simultaneously offering another case study. Didi was among the most recognized global brands caught up in the tech crackdown President Xi Jinping launched in late 2020. Now, the ride-hailing juggernaut plans to list in Hong Kong early next year.

The comeback — and Didi’s success in restoring relations with Chinese regulators — is all the more remarkable considering the drama surrounding its forced delisting last year.

Its ill-fated New York initial public offering (IPO) came as Xi’s team was reining in top internet platforms, starting with Alibaba Holdings and later extending to Didi, Baidu, ByteDance, JD.com, Meituan, Tencent and others.

Naturally, Didi needs the blessings of Xi and Premier Li Qiang to arrange any new share listing. It set the stage for an IPO by acceding to regulators’ concerns about corporate governance and data privacy — and paying an 8 billion yuan ($1.1 billion) fine in 2022.

Didi was forced to take a ride-hailing break after authorities demanded changes to its data-collection practices. Photo: Asia Times Files / AFP

Damage has been done, of course. The company’s market share at home dropped to about 70% today from 90% before Xi’s tech clampdown. Yet like Alibaba, Didi is offering peers a blueprint for how to make peace with the regulatory squeeze of recent years — and come out the other side with a still dominant position.

While a work in progress, Alibaba’s metamorphosis into a holding company with six different business groups offers its own pointers to mainland chieftains. Now add Huawei and Didi to the list of companies reminding Beijing that the way forward is savvy restructuring and disruption, not giant stock bailout funds.

Xi’s Communist Party is considering creating a state-backed stabilization mechanism, backed by hundreds of billions of yuan of public funds, to stabilize a shaky US$9.5 trillion stock market.

Global funds have been net sellers of mainland stocks in recent months amid disappointment over the strength of China’s post-Covid economic recovery. Recently, China’s sovereign wealth fund bought about US$65 million of stock in the nation’s biggest banks.

A broader stabilization fund would be akin to how Beijing dealt with the stock crash of 2015. That was when Shanghai shares fell by more than 30% in just three weeks.

This “national team buying,” as Li Fuwen, a fund manager at Guangdong Value Forest Private Securities Investment, puts it, is a more potent way “to salvage confidence” than others Xi has taken, including tax cuts and lower stamp duties.

David Nealis, president of consultancy Ceres Ltd, adds that the policy “sounds like an opportunity.”

Yet many market players are critical of the stock-buying fund, arguing it treats the symptoms, not the underlying causes, of China’s market rout.

Economist Victor Shih at the University of California, San Diego says “that’s basically re-nationalization,” running counter to Xi’s pledges 10 years ago to let market forces play a “decisive” role in China’s future.

Economist Trinh Nguyen at Natixis says the problem is that “underwhelming economic data and dejected retail investors” are fueling more sell orders than buying opportunities.

It’s a movie China investors have seen before, says Jeroen Blokland, founder of advisory True Insights. “In 2015, China did something similar, giving China Securities Finance Corp nearly $500 billion in firepower to stop the crash in Chinese stocks. It did not help. Chinese stocks dropped by another 20% after the announcement of the intervention.”

An investor is seen in front of an electronic screen showing stock information (green for losses) at a brokerage house in Hangzhou, Zhejiang Province, China. Photo: China Daily via Reuters
An investor is seen in front of an electronic screen showing stock information (green for losses) at a brokerage house in Hangzhou, Zhejiang Province, China. Photo: China Daily

Morgan Stanley analyst Laura Wang adds that previous interventions had no real lasting effect — including in 2015. “Whether the market could be effectively stabilized or reversed into an upward trend is not, in our view, solely dependent on such state purchase actions.”

What’s needed, Wang notes, is credible financial reforms that increase trust among foreign investors.

In the short run, investors are troubled by Xi’s reluctance to act bigger and bolder in rolling out fresh stimulus efforts to boost the economy and cushion the blow of a property slump. Xi worries that opening the fiscal and monetary floodgates might incentivize more bad lending behavior and that doing so would squander efforts to reduce leverage.

“Whatever does emerge from Beijing over the coming months, it likely won’t be quick enough to make any meaningful difference to 2023,” says Robert Carnell, head of Asia-Pacific research at ING Bank. “At best, it should be viewed as a pain management tool for the transition to a less leveraged economy.”

But structural reform is the key to stabilizing stocks. Priorities include strengthening China’s capital markets, financial infrastructure and corporate governance. Others: incentivizing innovation, increasing productivity and expanding opportunities for economic disruption.

Easier monetary and fiscal policies or bailing out markets won’t prod local governments to devise more competitive business environments, build social safety nets needed to get households to spend more and save less or address the nation’s fast aging population.

Stimulus won’t accelerate China’s transition from debt-and-investment-driven growth to a more domestic-demand-led model. It’s not sufficient to bolster foreign investors’ confidence to bet big on China.  And it can’t stabilize the nation’s deeply troubled property markets.

That’s not to say the People’s Bank of China central bank shouldn’t ease in the months ahead. As the government moves to sell bonds to smooth out growth, “the PBOC may need to step up its liquidity support and lower interest rates to accommodate the issuance, which adds conviction to our call for another cut to reserve-requirement ratios and a policy rate cut in the fourth quarter,” says analyst Maggie Wei at Goldman Sachs Group.

Yet Xi’s team must work faster to repair China’s shaky property sector. Two years after China Evergrande Group defaulted, fellow giant developer Country Garden is signaling it may miss payments on offshore obligations — as soon as this week. Country Garden’s debt load was about US$196 billion at the end of 2022.

A “default would likely hurt homebuyer confidence, especially in lower-tier cities where its properties are concentrated, which would undermine policies to boost sales across the country,” says analyst Rick Waters at the Eurasia Group risk consultancy.

China’s Country Garden is the latest property developer that can’t pay its debts. Image: Screengrab / CNN

However, Waters notes, “Beijing is likely still reluctant to bail out the company. In fact, the government launched an investigation against Evergrande that prevents it from restructuring debt. If Beijing does help, it would probably focus on acquiring and completing unbuilt residential projects.”

A stock-buying fund, circa 2023, does get at a big paradox of the Xi era: if these periodic interventions work, why are they still necessary 10 years on?

To be sure, the bear market signals emanating from Shanghai today aren’t as dire as in the summer of 2015. Those chaotic declines slammed bourses from Tokyo to London to New York and fueled contagion fears.

At the time, Xi’s government scrambled to loosen rules on leverage and reduce reserve requirements. It also delayed all IPOs, suspended trading in thousands of listed companies, allowed apartments to be used as collateral to buy shares and lobbied households to invest in stocks out of a sense of patriotism.

The common thread between then and now is Team Xi’s penchant for prioritizing market-opening efforts over reforms – a tendency to over-promise and under-deliver financial upgrade-wise.

Since 2015, Xi’s regulators accelerated steps to open equity markets wider and wider to overseas investors. As Beijing increased quotas for foreign funds, it prioritized getting its government bonds added to benchmarks like the FTSE-Russell.

Likewise, moves to include Shanghai and Shenzhen stocks in benchmarks like MSCI outpaced reforms needed to prepare China Inc for global prime time. Flipping the script requires methodically increasing transparency, ensuring companies tighten corporate governance, building reliable surveillance mechanisms like trusted credit rating companies and erecting a robust market infrastructure before the world shows up with its funds.

A freer media also would help Xi’s inner circle intensify anti-corruption efforts and would be a natural ally in policing the malfeasance that distorts economic incentives and squanders the benefits of rapid gross domestic product (GDP).

But as Huawei and Didi are demonstrating, the ways in which top tech names are emerging from three years of regulatory shocks offers intriguing counterprogramming as the property sector continues to stumble.

Huawei alone is causing big ripples among Western tech communities who assumed US export controls curbing access to chip supplies had sidelined China Inc. Huawei’s 7-nanometer chip, which powers the smartphone’s processor, was designed in-house and manufactured by the mainland’s top chip vendor, Semiconductor Manufacturing International Corporation (SMIC).

While there are questions about whether Huawei’s 5G capabilities match Apple’s, the 7-nanometer chip “demonstrates the technical progress China’s semiconductor industry has been able to make without Extreme ultraviolet lithography (EUV) tools,” says Dan Hutcheson, vice chair of TechInsights.

Huawei’s exhibit dominated this year’s Mobile World Congress held in Barcelona. Image: Facebook

Significantly, Hutcheson says, the componentry used for Huawei’s Mate 60 Pro showcases the progress of Xi’s signature “Made in China 2025” plan. It aims to dominate everything from semiconductors to electric vehicles to renewable energy to artificial intelligence to biotechnology to aviation.

In part, Huawei’s success “does signify” that Beijing’s tech subsidies are gaining traction, says analyst Hanna Dohmen at the Washington-based Center for Security and Emerging Technology. Without the role of state-backed SMIC, Huawei’s feat would’ve been much harder to pull off.

Yet Huawei is reminding US President Joe Biden’s White House, which this week doubled down on restricting access to cutting-edge tech including semiconductors and chipmaking gear, that China Inc has the wherewithal to navigate around sanctions.

Didi, meanwhile, is demonstrating in other ways how China’s most innovative tech platforms are shifting into higher gear. Xi’s reform team would be wise to lean into these promising case studies, implementing reforms to ensure they’re more the norm than the exception.

Follow William Pesek on X, formerly Twitter, at @WilliamPesek

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Singapore's economy in a geopolitical squeezebox

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SINGAPORE- Recent data indicates better-than-expected but also sluggish growth in Singapore after narrowly avoiding a specialized recession earlier this year. & nbsp, However, analysts warn that if the United States and Chinese economies fall short of their baseline projections, the city-state’s trade-reliant economy may slow down for the rest of this year and even into 2024.

According to advance estimates recently released by the Ministry of Trade and Industry ( MTI ), the gross domestic product ( GDP ) increased by 0.7 % year over year in the July to September quarter. The economy grew by 1 % over economists’ predictions and faster than the tepid 0.1 % growth in the quarter before it on a quarter-on-quarter seasonally adjusted basis.

The Monetary Authority of Singapore, the city-state’s central bank, cited” muted” growth prospects in the near future and expectations of full-year growth to come in” at the lower half” of the official forecast range of 0.5 % to 1.5%” in a policy statement on October 13. It was also stated that by the second half of the following year, growth in Singapore’s main trading partners should eventually pick up.

A study word reviewed by Asia Times found that researchers at the research agency BMI Research were less optimistic about a recovery in 2024. Due to anticipated slowdowns among Singapore’s major trade partners and fiscal consolidation, the independent monitor revised its full-year growth forecast downward from 1.1 % to 0.8 % and predicts a further deceleration to$ 0.5 % in 2024.

The government of Singapore is” constitutionally required to run a sensible budget over the course of its term, which ends in 2025, and it must make up for the sizable imbalances it ran to support the economy during the pandemic.” Another reason why Singapore’s smaller and available economy will suffer greatly from the slowdowns we anticipate in the US and China is a weak recuperation in exports growth, according to BMI.

According to the report, personal consumption is likely to continue, with Singaporeans’ real disposable earnings being supported by easing inflation and challenging labor market problems into the coming year. However, with an import downturn, businesses are likely to become cautious, meaning that investment growth is expected to be” well below pre-pandemic rates.”

The city-state’s main non-oil home exports, which researchers use as a gauge for additional demand, contracted for the 12th subsequent month in September, falling by 13.2 %, with both the technology industry and those outside of it showing signs of decline. According to official data, the export decline last month was less severe than the 22.5 % drop in August and the 20.3 % decline in July.

shipping vessels at the PSA harbor in Singapore. Singaporean government pictures

The Singapore economy’s directly oriented sectors have already been hampered by the weakening world economy and poor manufacturing demand. According to Selena Ling, chief analyst at Oversea – Chinese Banking Corp in Singapore, any more decline in the political or economic environment could pose negative threats.

Manufacturing, which makes up one-fifth of the city-state’s GDP, saw an annual growth of 5 % in the second quarter following a 7.7 % decline during the preceding quarter that, according to Ling, was less than anticipated. She continued,” In the future, it might be more important to see the service and development sectors, which had been reducing the external need moderation, remain resilient.”

Tan Wen Wei, an Asia analyst at the Economist Intelligence Unit( EIU ), observes that weak domestic demand in China has already had an impact on Singapore’s growth in the fourth quarter and into 2024 as a result of the city-states’ slumped property sector and sluggish export performance.

Tan said the major economic impact of the issue may come from higher imported power costs, pointing out the uncertainty surrounding Israel’s anticipated military activity in Gaza. Although oil prices had increased following this affair, he claimed that a sharper escalation involving Iran may further disrupt the supply chains and oil production, raising the price even further.

In Singapore, rising oil prices would result in rising energy costs, inflation, and a 8 % to 9 % increase in the Goods and Services Tax ( GST ) in January 2024, in addition to other planned price increases for public transportation and water. Tan stated to Asia Times,” Higher inflation will present a drag to personal consumption and growth as resulting.”

The MAS noted that core inflation, the central bank’s preferred customer value test that excludes private transportation and lodging costs to better represent household bills, has slowed and is anticipated to widely rise over the course of the following year in its October 13 policy statement.

For the third month in a row, core inflation has decreased from its 14-year high of 5.5 % in January and February to 3.4 % in August. Although the main banks maintains that an average core inflation rate of just under 2 %, which is close to its historical suggest, is consistent with general price stability in the economy, the MAS does not have an obvious inflation target.

Instead of using interest rates as its primary policy instrument to control inflation, the MAS uses the transfer price of the Singapore money weighed against a basket of assets from the city-state’s major trading partners. After five rounds of strengthening between October 2021 and 2022, it has maintained the current price of currency recognition since April of this year.

” Rising prices continues to be the main barrier to looser plan.” However, we don’t believe such a move is far off given that core inflation is expected to fall near to target rapidly. According to Alex Holmes, a lead economist at Oxford Economics, supply-side elements generally point to more disinflation away despite some top challenges from higher energy and energy costs.

A Singapore dollar note in a May 31, 2017 photo. Photo: Reuters/Thomas White/Illustration/File Photo
Although prices has decreased, there is still a chance in Singapore. Asia Times Files / Agencies image

Holmes continued,” We believe that the majority of analysts are underestimating how quickly the MAS may move once it is allowed. ” We believe the MAS will start loosening policy, perhaps by reducing the side of the policy group in January, given that core inflation is expected to close in on 2 % by early next year and the economic landscape will probably still be melancholy.”

Additionally, the central bank declared that starting in 2024, it may increase the frequency of its policy choices to a weekly basis. It now does but on a half-yearly basis, with comments being released in April and October. According to observers, the change will give the MAS more freedom than before to communicate and adjust to changing economic conditions.

In the previous two decades, inflationary situations had forced the central bank to make off-cycle adjustments half. According to the EIU’s Tan, the MAS would be able to” react more nimbly to uncertainties surrounding growth and inflation, amid a more volatile political background” if monetary policy review was coordinated with weekly progress development estimates. & nbsp,

Follow Nile Bowie at @ NileBowie on X, formerly Twitter.

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Chiang Mai Airport time extension draws fire

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16 October 2023 at 18: 37 PUBLISHED

Chiang Mai Airport time extension draws fire
In front of Chiang Mai International Airport, there are a lot of vehicles parked. ( Photo: International airport in Chiang Mai )

Residents claim that the idea of Chiang Mai International Airport opening around-the-clock will disrupt their ability to sleep due to the constant plane sound in their homes.

At a public reading held on Sunday for people in areas close to the airport in the Muang city of Chiang Mai’s tambon Mae Hia, their opposition was expressed.

The Mae Hia metropolitan auditorium’s Thanawat Yodjai and Chiang Mai aircraft director Wg Cdr. Ronnakorn Chalermsanyakor accompanied the reading. In addition, & nbsp,

The majority of conference attendees objected to the plan to keep the aircraft open 24 hours, which was tentatively scheduled to start on November 1. & nbsp,

They bemoaned the fact that the airport was now operating 18 hours a day and that they were already troubled plenty. Some claim that sound pollution and noise from aircraft taking off and getting interfere with their ability to rest. According to the website, roof stones on homes were damaged as a result of the noise.

The locals claimed that if the aircraft ran nonstop, they would be unable to imagine how much longer they may put up with. & nbsp,

Additionally, the sorrow they have already experienced has not been properly made up for.

In order to deal with the province’s growing weather traffic, which is seeing a post-pandemic uptick in tourism and the forthcoming start of the tourism season next quarter, the aircraft wants to increase procedures to 24 hours. & nbsp,

According to Wg Cdr. Ronnakorn, the Chiang Mai airport oversees 150 flights per day, 115 of which are local and the remaining worldwide. & nbsp,

There will be planes to replace early-morning slots once the aircraft begins operating continuously, he said.

Wg Cdr Ronnakorn assured the crowd that the problems they are worried about would be resolved quickly. Airport executives may receive comments and suggestions from the Sunday hearing for review.

Residents of tambon Suthep, who likewise reside close to the airport, are participating in another open hearing on the matter immediately.

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Maxis, Digital Penang to boost technology and digital ecosystem for MSMEs

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Maxis will use electronic options, and 5G Mobile will encourage the adoption of electronic among MSMEs.Maxis’ connections in the innovative digital area community will be facilitated by Digital Penang.To expand the digital and nbsp, technology ecosystem space in Penang’s micro, small, and medium enterprise( MSME ) sector, Maxis and Digital Penrang…Continue Reading