In today’s talking points: Do recent trends point to a shift towards green technology investment?; South Australia’s Financial Sector: between state grants and state levies; Bellamy’s Camperdown Powder canning facility licence suspended by Chinese authorities; China’s overseas acquisitions picking up over recent months
Do recent trends point to a shift towards green technology investment?
Numerous analysts have expressed their concerns regarding whether some of Australia’s biggest companies are investing sufficiently to plan for a clean energy future. According to research, about $2 trillion worth of oil and gas projects could be made redundant in a carbon-constrained future, which suggests that financial investment into fossil fuels needs to consider the risk factors.
Mark Campanale, founder of independent financial think tank Carbon Tracker Initiative, noted that the continued support of an increasingly outdated business model might well be termed the “carbon bubble”, as he said that $2 trillion worth of investments were at risk as international climate policy developed.
Vocalising a similar trend, markets economist Rob Henderson said that all of the money in the financial market is heading towards renewables, and away from older technology. Both of which suggest that financial services regulators can play a more active role in climate policy leadership.
Read more on: ABC News
South Australia’s Financial Sector: between state grants and state levies
Following the announcement of a new proposed state levy on five big banks, the South Australian Government says a $900,000 grant has attracted 200 new finance sector jobs to Adelaide, showcasing the state as a competitive place to do business.
Embracing the high-tech space, the grant enables Bendigo and Adelaide Bank, to partner with another firm, Tic Toc, to process online home loans at an expanded operation in the Adelaide CBD. However, notwithstanding the grant’s positivity, not everyone is sees it as sufficient to counter the state levy announcement, and the Australian Bankers Association said the proposed state levy on the big four banks and Macquarie, intended to raise about $370 million over four years, would be an “outrageous cash grab”.
A typically controversial topic, the planned state levy on big banks seems unlikely to be passed by the Upper House of State Parliament, but continues to be a topic of discussion within South Australia and other states.
Read more on: ABC News
Bellamy’s Camperdown Powder canning facility licence suspended by Chinese authorities
Bellamy’s shares have come to a trading pause to understand why Chinese authorities suspended Camperdown Powder’s canning facility licence from the Certification and Accreditation Administration of the People’s Republic of China (CNCA).
In accordance with Chinese policies, Bellamy’s are required to register their canning facility, where the Chinese-labelled infant formula products are blended and packed, with the CNCA. A new policy also requires them to register with the China Food and Drug Administration (CFDA) which is to come into effect on January 1, 2018. In pursuant with these policies, Bellamy’s recent acquisition of a 90 per cent interest in Camperdown Powder is to adhere to canning requirements and registration with CFDA.
However, Bellamy’s is to notify the CNCA of the change in control and if the notification is not accepted, Camperdown Powder’s registration may be cancelled. It remains unclear why the licence is suspended and further information is required.
Read more on: SBS News
China’s overseas acquisitions picking up over recent months
Despite experiencing a sharp drop in outbound foreign investment in early 2017, a new report prepared by the Rhodium Group found that the number of overseas mergers and acquisitions (M&A) of Chinese companies’ have picked up.
The sharp drop can be explained by the strict rules imposed to regulate capital flight pressure and reduce illegal outbound investment earlier in the year, which has eased in June. Accordingly, in May and June, Chinese companies announced that there have been more than 20 new overseas M&A transactions valuing of USD$5 million – equivalent to the levels experienced in the peak of 2016.
Though the overseas acquisitions in 2016 predominantly involved private companies, sovereign and state-owned companies are accounting for approximately 60% of the total M&A transactions for the period of January to June. China Investment Corporation, a Chinese sovereign wealth fund, has obtained the biggest deal so far this year – buying Logicor from Blackstone for USD$13.8 million in June. It appears that, despite a slow start, China’s outbound investment will continue.
Read more on: China Daily