In today’s talking points: Housing prices continue to rise in Sydney, Melbourne over 2017 signalling a possible 2018 bust; Foreign funds welcome in Shanghai manufacturing; China Construction Bank enacts debt-for-equity swap with Xiamen CCRE worth US $739 million; China’s debt risks controllable through future challenges: official
Housing prices continue to rise in Sydney, Melbourne over 2017 signalling a possible 2018 bust
As housing prices continue to rise, property analysts are forecasting no immediate end in sight. The already over-valued market will continue its price gains well into 2017, increasing the risk of a 2018 bust as the reserve bank shifts its description of the housing markets in Sydney and Melbourne from growing “moderately” to “briskly”. While the level of growth has not yet reached the 19 per cent peak experienced in 2015, it now occurs in a market already over-valued. Analysts have also warned that Melbourne is at its most overvalued point ever recorded.
Read more at: ABC News
Foreign funds welcome in Shanghai manufacturing
Shanghai city government has taken steps to encourage foreign investment to help bolster the city’s industrial base. The efforts come at a time when foreign investment in manufacturing in shanghai has remained below 10 per cent since 2013. Four manufacturing projects have been approved, totalling 41.3 billion Yuan (US $6.1 billion) worth of investment. Previously, foreign investment mainly focused on advanced production such as cloud computing and 3D printing.
Read more at: Shanghai Daily
China Construction Bank enacts debt-for-equity swap with Xiamen CCRE worth US $739 million
In a bid to help China’s manufacturing industry through the current tough period, China Construction Bank has signed a 5 billion Yuan (US $739 million) debt-for-equity swap agreement with state-owned Xiamen CCRE. China Construction Bank has been leading the country’s latest round of debt-for-equity swaps and has plans for more than 50 such swaps in the future, spanning a variety of sectors. CCB has plans to set up a new subsidiary for the purpose of handling debt-for-equity swaps.
Read more at: Reuters
China’s debt risks controllable through future challenges: official
A Chinese finance official has assured the world that China’s debt calculation is open and transparent and the risks controllable. The assurances come among concerns that China’s policymakers are underestimating the country’s debt level. The official also quelled concerns about the rising debt, stating that the current level of debt is “reasonable” seeing as both central and local governments were below 40 per cent. China employs various measures to manage debt risk, such as debt-for-equity swaps and ministerial mechanisms to tackle corporate leverage.
Read more at: China Daily