财经 2016年19期

Vanke: A Win-win or Lose-lose Scenario

As a matter that has drawn in business chiefs, lawyers, economists, and social scientists from inside and outside the real estate industry, the year-long dispute over control of China Vanke Co. (Vanke) has evolved from a matter of business into a social issue.

The ideal outcome is for Vanke to form a new board of directors in line with the shareholders status quo, while retaining the current management team, and maintaining existing corporate culture and management mechanisms. This will allow the Vanke event to go down in history as a case of promoting the improvement of Chinese business civilization. However, if the parties involved fail to compromise, the resulting outcome will be one of lose-lose with “Chinese characteristics.”

What Will End the Bear Market in Commodities?

In mid-June, the Bloomberg Commodity Index rebounded from its lowest point at the beginning of this year, rising more than 20 percent. The commodity market looks bullish going into the second half of the year, but the one-way triumph will be difficult to sustain.

The previous bull market in global commodities was driven by strong growth in demand from China. When examining when a bear market in commodities will end and when a bull market will begin, it is important to first look at supply and demand fundamentals. In other words, a significant reduction in supply and significant improvement in demand will mark the end of a commodities bear market.

Why is Securities Regulation So Difficult?

The capital market can allocate resources more efficiently than administrative planning only on the condition that the markets pricing of assets is accurate and asset prices do not deviate from fundamentals. If regulatory authorities influence stock market prices through policy, the media, and other means, this is equivalent to intentionally creating a mismatch of resources.

In order to “let the market play a decisive role in the allocation of resources”, the China Securities Regulatory Commission should not assume macroeconomic tasks; at the same time, the state must withdraw from its role as a corporate shareholder. This will allow regulators to become neutral referees and help to sustain the development of the stock market.

Government in Dilemma Over Waste Incineration Protests

Recently, from Xiantao in Hubei Province to Zhaoqing in Guangdong Province, local residents have taken to the streets to protest various waste incineration power generation projects. Continued increases in housing prices have raised public expectations toward environmental quality, and at the same time the publics self-protection awareness of environmental benefits has increasingly strengthened. If the government cannot remold an effective environmental impact assessment system that promotes integrity, the risk of “breakdown” of major investment projects will be markedly increased.

Although governments at all levels have made various attempts to increase public participation and improve public decision-making mechanisms in recent years, these measures are only “patches,” and do not fundamentally resolve the vital points of the current public decision-making system.

Wuhan a Stark Reminder of Chinas Urban Waterlogging Problem

Continuous heavy rainfall, rising reservoir water levels, insufficient floodwater storage areas, and poor drainage capacity have caused severe flooding in Wuhan, the capital city of Hubei Province. The flooding in Wuhan and other cities has left a big question mark on Chinas management of urban waterlogging.

To improve the nations capability in handling urban drainage waterlogging, China should strengthen management and protection of flood basins, store floodwater areas, and waterlogging high-risk areas. Second, communication and coordination among relevant departments should be enhanced. Third, a regional storm water management system should be gradually established in the process of urban construction. Fourth, investment should be increased to build ‘sponge cities that can better save water.