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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Stitch who wrote (2717)	3/19/1998 10:11:00 PM
From: Tony van Werkhooven	Read Replies (1) \| Respond to of 9980

Stich- this AM it was commented that SIDBY was not down nearly as much as expected (-5% vs -45%). What is your take on this? You expect further down pressure over the next month or so? Thanks tony

To: Stitch who wrote (2717)	3/19/1998 10:13:00 PM
From: Tony van Werkhooven	Read Replies (1) \| Respond to of 9980

The following represents a political analysis of current events in China: Global Intelligence Update Red Alert March 20, 1998 Chinese Leadership Reshuffle Offers no Respite for Dissidents In an open letter to new Chinese Premier Zhu Rongji, distributed on Wednesday by the Hong Kong-based Information Center of Human Rights and Democratic Movement in China, 12 Chinese dissidents from eastern Zhejiang province demanded that Zhu use his new power to institute greater individual freedoms and create a constitutional democracy in China. A chief architect of China's moves toward a mixed market economy, Zhu recently replaced Li Peng as Premier, when Li became Chairman of the National People's Congress (NPC). (http://www.stratfor.com/services/gintel/region/stories/030698.html) Despite Zhu's credentials as an economic reformer, the prospects for a shift to greater freedom and democracy in China are currently very slim. On Thursday, rights groups in China reported to Agence France Presse on a new crackdown on Chinese dissidents, including five detentions, an arrest, and a disappearance. According to AFP's sources, veteran dissident Fan Yiping was arrested on March 16 in Guangzhou for allegedly spreading leaflets from the U.S.-based China Democracy and Justice Party. Three other Guangzhou dissidents reportedly were also temporarily detained for questioning for involvement with the China Democracy and Justice Party. Dissidents in Fujian and Hunan were also temporarily detained in the past week, while computer engineer Lin Lianjun disappeared on March 17 after installing computers for dissidents in Fujian. Four additional dissidents were arrested in early March for calling for political reforms in open letters to the NPC. Pressured by China's economic downturn, which was already underway before the Asia-wide economic crisis hit and has only been exacerbated since, China's leaders are in no position to launch new political reforms. Quite the contrary, as China's economic crisis accelerates into an internal political crisis--pitting the Interior against the Coast and both against Beijing--we can only expect greater repression from Beijing. ___________________________________________________ To receive free daily Global Intelligence Updates or Computer Security Alerts, sign up on the web at stratfor.com, or send your name, organization, position, mailing address, phone number, and e-mail address to info@stratfor.com

To: Stitch who wrote (2717)	3/20/1998 12:02:00 AM
From: B Tate	Respond to of 9980

Stitch; ..re. inflation. As you know, in my line of business (as with any other OEM) working capital is paramount. With the demise of SE Asian banking capabilities the necessary credit facilities are becoming extremely hard to find. True scenario - Sime Bank has withdrawn 1.5 MM from a 5MM line of credit from one of my vendors (with a warning that a further reduction is likely). This vendor is building 100% export product, has no history of a credit problem and has firm POs and contracts in hand. The vendor has a 5-7 year relationship with Sime, however the bank says "we just don't have any money to back either your LCs or your trading account revolver." This is also one of my Trade bank accounts (Sime)and I will need the same facilities for several vendors we use. Since I have substantial cash reserves my revolving trade account will be smaller (1.5MM??) if I can find one. In searching for other facilities we have both found that the ONLY money available is from the off-shore banks. Hong Kong Shanghai Bank, Standard Charter, OCBC, UWCCB and Citibank have funding available with the caveat that new customers, no matter the strength, will be served on a priority 2 basis. - My point in all this is that sooner or later the availability of funding or 'normal' business with good companies is going to dry up. This will mean severe competition for funds, raising the rates maybe even globally. Where/how will the recovery be financed? By western banks? Not without substantial pain I'm afraid. This will also have an effect on the spending necessary for capital equipment etc to build out of this regional recession. And the snowball continues. As a joint venture (US/Malaysian) I might be able to get the necessary funding from a US bank, but seriously doubt it. I'm a little guy, I can imagine the difficulties of some of the larger corporate entities both local and international are going to go through! As this is this weeks crisis, I'll keep all informed as to the outcome. Suffice it to say I'll be spending my weekend with Excel worksheets doing cash flow models 8>( This s<m>pells BEAR to me. BTW KLSE looks to be down today after a good up day yesterday. best bt

To: Stitch who wrote (2717)	3/20/1998 12:17:00 AM
From: B Tate	Respond to of 9980

Stitch, Worswick and all Last evening's late news: One of the local "Robber Barons" is defaulting on a note (or some kind of payment) to a steel company in the Philippines. Result the steel company may go down causing the Ph. central bank to be taken down with it (large position). This local is a friend of the good Dr. M, who was persuaded to step in after another of the good Dr's buddies Datuk, Dato something or other went crash last fall. The impact will likely lead to "severely strained ties between the two governments" as stated by CNBC Asia on the Asia Wall Street Journal show last night. What is the animal that has to be separated from the offspring since they eat their young? Could be the start of something very interesting in SEA. Add the new Indian gov't and the ever volatile Indonesians and we could have a real neat 'stew' brewing in the region. First impact, my guess is - There goes the ASEAN partners trading in local currencies and the proposed "Regional bail-out Fund". bt