English to Chinese: Economic outlook General field: Bus/Financial Detailed field: Economics
Source text - English Economic outlook: Backward looking or concurrent economic data reported in March (such as bank lending, industrial profits, same-store sales) were generally weak, but forward looking indicators such as property sales, residential floor space started, and the official PMI’s new orders index are recovering. We maintain our view that sequential economic growth will likely improve in Q2.
We believe that the government will need to fine-tune policies to support lending growth and sustain the recovery of property sales. These measures include modestly relaxing the regulatory risk guidance against lending to LGFVs, property developers focusing on ordinary commodity housing, and sectors that are classified as “two high and one surplus”. On properties, the government should gradually increase its tolerance for policy easing on financing for home buyers and developers, as well as on eligibility of home purchases in major cities.
Main risks: Delay in policy fine-tuning may lead to lower-than-expected lending and pose downside risk to growth.
Strategy Recommendation: We expect modest upward pressure of money market rates in April compared with March, before PBoC cuts RRR. On cash bond market, the combination of improving growth outlook, disinflation, modest risk on liquidity and CGB supply will likely keep the CGB yield in a narrow range. We maintain our range trading view on cash bonds and CNY IRS. We expect Q2 CGB gross supply at CNY 441bn and net supply at CNY 264bn.
CNH fixed income market: We expect gross supply in Q2 to climb to RMB 109bn, and net supply to RMB 79bn, about 30% of what we forecast as the full year net supply.
Implication of the 2012 foreign debt quota: We see three key market implications: (1). The USD 24bn quota will contribute to an equivalent amount of capital inflows this year under foreign borrowing; (2) Provide access to cheaper offshore funding to projects by local corporations; (3). Upward pressure on USDCNH FX forward/CCS and USDCNY onshore forward or NDF.
Backward looking or concurrent economic data reported in March (such as bank lending, industrial profits, SSS) were generally weak. Three sets of data disappointed the market in March. First, new RMB lending in February only reached RMB710bn, vs. a more normalized pace of RMB800bn (if the annual target of RMB8tn is to be achieved on normal seasonality). Many people begin to worry that this may reflect the lack of demand for loans in the economy, which could be viewed as a bearish sign of weakness from the demand perspective. Second, industrial profit declined by 5.2% yoy in Jan-Feb, vs an increase by 25% in 2011. This again scared many observers. Third, many consumer companies reported decelerating same store sales, reflecting in part weaker demand for selected consumer items. For example, passenger car sales declined by 4.9% yoy in Jan-Feb (vs. last year’s 5% growth), and electronics sales declined by 2.9% in Jan-Feb vs last year’s growth of 21.6%.
We are less pessimistic than many observers on these data for several specific reasons, although we do recognize they are weak in general. First, the weaker-than-expected new lending most likely reflects the lack of effective demand – rather than potential demand – that is being artificially depressed by excessively stringent regulatory policies. As soon as these policies are modestly relaxed, effective demand for loans should recover to normal levels. Currently, there are three sets of risk guidance that discourages bank lending to certain sectors: 1) banks are advised by regulators to be very selected in lending to LGFVs; 2) banks are advised to limit their loan exposure to developers; 3) banks are advised against lending to sectors that are classified by the NDRC as “two highs and one surplus”, i.e., sectors of high energy intensity and highly polluting as well as those with over capacities. We estimate that these “restricted” sectors represent about 50% of total FAI and thus about half of potential lending demand. In addition, the banking system which is dominated by large banks has very limited capacity and appetite in lending to small and micro firms, while smaller banks (which are more inclined to lend to small/micro firms) are short of liquidity under the stringent cap on the loan-to-deposit ratio and a very high reserve requirement (17%).
Second, the falling industrial profit in Jan-Feb is largely a result of a tentative margin squeeze due to high costs of materials purchased a few months ago. Large industrial firms, including most SOEs, tend to sign procurement contracts for their raw materials and components 3-4 months ahead of production. Therefore, the costs of goods sold in its January-February P&L largely reflects the market prices of raw materials around September 2011, the peak of the current cycle. Note that the raw material price index in September is about 2.2% higher than the January-February average. Hence, the costs of goods sold in its January-February P&L is tentatively boosted by about 2% (vs. the costs to be booked in the coming few months). Meanwhile, the producer (selling) price index hit the trough in January this year, at 1.8% below the level in September 2011. Thus, the mismatch between the peak in costs of goods sold and the trough in selling prices can easily explain most of the margin contraction for industrial firms in January-February (to 5%, down from 6% in January-February 2011).
Third, on slower consumer spending, despite the decline in car and electronics sales in Jan-Feb, total nominal retail sales growth slowed only modestly in Jan-Feb to 14.7% yoy, down from 17.1% for last year. And as for volume growth, retail sales decelerated by only 0.6ppts (from last year's 11.6%) to 10.8% in Jan-Feb. Therefore, the majority of the slowdown of nominal retail sales in Jan-Feb was due to disinflation, a reason that should last for only 5-6 more months.
On the positive side, forward looking indicators such as property sales, residential floor space started, and the official PMI’s new orders index are recovering. First, property sales, which will importantly influence developers’ investment decisions, recovered from a yoy decline of 40% between October and February to a 39% yoy rise in March in 39 major cities. The Jan-Feb rate is somewhat artificially boosted by the lower base in the same period last year, but even stripping out this effect, the yoy growth still recovered to around zero, much better the 40% decline in the previous months.
Second, the yoy growth of residential floor space started, a leading indicator for residential construction, recovered from -25% in December to zero in Jan-Feb. This suggests that construction growth will likely slow less dramatically as compared with previous market perception. Third, the export orders indices in both the official and HSBC PMI recovered in the past 3-4 months. For example, on a 3MMA basis (which removes majority of the seasonality), the export orders index in the official PMI report rose steadily from 47 in January to 50 in March.
Compared with the weaker backward looking indicators, we believe that these above-mentioned three forward looking indicators are more meaningful for investors to gauge the future trend of growth. The significance of these forward looking indicators is that they indicate the likely recovery from two most uncertain sources of growth – property demand and export demand. That is, with these two factors turning positive, at least downside risks are significantly curtailed.
We do not expect any material changes in the stance for monetary and fiscal policies from what we predicted earlier, but prudential and real estate policies should see some further relaxation. We believe that prudential and real estate policies will need to be fined tuned in the coming months to ensure that annual new lending can achieve the target of RMB8bn (consistent with the M2 growth target of 14%), and that property sales stay at the recently recovered levels. RMB8tn of RMB new lending and stable property sales are critical for the overall economy to achieve a GDP growth rate above 8% this year, especially for the time around the 18th Party Congress.
On prudential policies, we suggest that the government modestly relax its risk guidance in the following three areas: 1) applying normal lending standards to LGFVs that do not have solvency issues; 2) ensuring lending to developers that primarily build ordinary commodity housing, in order to prevent shortage of supply over the medium term; 3) giving more flexibility to banks in applying the risk guidance on “two highs and one surplus” in screening borrowers; 4) reducing (by a bigger margin) the RRR on smaller financial institutions, which are more inclined to lend to small and micro firms. We believe the combination of some of these actions – many of which can be taken in a very low profile as part of the internal window guidance – should be sufficient to boost monthly lending growth to RMB800bn per month in the coming few months.
On real estate polices, the government should fully recognize that housing affordability has already improved significantly in the past one and half years in 39 major cities, and will continue to improve as long as property price inflation is slower than income growth. With income having grown 20% in the past 18 months, and property prices falling by about 5%, affordability has risen by about 25%. This is in fact one of the reasons why property sales have recovered recently – the other reason being the cut in first home mortgage rates by banks. In the coming 2 years, if nominal prices remain stable, affordability will improve by easily another 20% due to income growth.
Recognizing this substantial improvement in affordability, we think the government should consider refine some of the restrictive policies on financing for home buyers and developers and the eligibility of home purchases. The policy options include: 1) banks cut their first home mortgage rates further; 2) regulators cut the minimum mortgage rates for second homes for upgrading purchases from 1.1 times benchmark to one time; 3) regulators reduce the minimum mortgage down-payment ratio (60%) for second homes; 4) banks normalize their lending policy on developers that mainly build ordinary commodity housing; 5) in selected cities, permit local governments to expand the scope of eligible home buyers to those non-hukou holders who have lived in the cities for 3 years.
Fixed income strategy: We expect modest upward pressure of money market rates in April compared with March, before PBoC cuts RRR. On cash bond market, the combination of improving growth outlook, disinflation, modest risk on liquidity and CGB supply will likely keep the CGB yield in a narrow range. We maintain our range trading view on CGBs and CNY IRS.
April liquidity outlook:
We update our forecast on interbank liquidity in April based on our liquidity model.
Net inflows: In February, PBoC’s net FX purchased was CNY 25bn (about USD 4bn). This is the second consecutive months of net FX purchase since Q4 2011, albeit a 82% MOM drop from January. The drop in net FX purchase can be explained by the unusually large trade deficit in February, when taking out trade deficit and FDI, capital inflow from other sources amounted to CNY 175bn (USD 28bn), the first sign of inflow in the last five months (see graph below).
The Jan-Feb combined net FX purchase was CNY 166bn (USD 26.3bn), this is much lower than our prior forecast of USD 45bn (25bn in January and 20bn in February). In March, we further trim our forecast of net FX purchase at about USD15bn (reflecting trade balance to remain in deficit and slower growth in FDI this year). In April, we expect net FX purchase at USD 20bn with export recovery and capital inflows in the form of foreign banks borrowing from overseas following the increase in foreign debt quota on foreign banks with onshore operations (see the last page for further discussion).
Fiscal deposit: Fiscal deposit grew by CNY 122bn in February, falling by 66% from January, and it was lower than our forecast of CNY 300bn. We had expected March fiscal deposit to fall by CNY 100bn, due to fiscal stimulus spending and low tax collection, and we believe it has contributed to the normalization of interbank liquidity this month. However, typically April – May fiscal deposit tends to grow strongly due to corporate tax payments, and the graph below shows the strong seasonality in this period over the past five years. Corporation tax payments reduce corporate deposits and increase fiscal deposit, which is government’s deposit at the central bank, and this serves as a net drain of liquidity from the banking system to the central bank’s balance sheet. We forecast monthly fiscal deposit growth of CNY 400bn, after taking into account of the fiscal stimulus spending.
Open market operations: PBoC net drained CNY 72bn liquidity in the open market in March, much less than the liquidity drainage in February at CNY 240bn. In April, we estimate about CNY 451bn OMO redemption, the largest monthly redemption on a YTD basis. In fact, PBoC has been rolling OMO redemption through short-term repo operations in recent weeks to retain flexibility in meeting liquidity demand in the market.
If we combine the liquidity impact from the above three factors (see the table below), we estimate net liquidity injection in April at CNY 146bn if PBoC does not roll over any of the upcoming OMO redemption. If April loan growth is CNY 750bn, we think the banking system is net short of approximately CNY 50bn liquidity. Unless there is upside surprise from capital inflow or slower fiscal deposit growth, we think it is likely PBoC may cut RRR by 50bps sometime during the second half of April to the beginning of May in order to maintain desirable pace of lending growth.
IPO factor: It is possible that China’s Citic Heavy Industries) will seek to raise over CNY 4bn capital through IPO in the next one to two months, likely the largest IPO in China this year. While timing of this IPO funding remains uncertain, we see risks of liquidity squeeze to be reflected in short-dated Repo swap rates, likely within 3-5bps.
We expect modest upward pressure of money market rates in April compared with March, before PBoC cuts RRR. On cash bond market, the combination of improving growth outlook, disinflation, modest risk on liquidity and CGB supply will likely keep the CGB yield in a narrow range. We maintain our range trading view on cash bonds and CNY IRS.
CGB Q2 supply risk
The MOF completed approximately 16% of its net financing requirement for 2012 in Q1 with a gross issuance of CNY 218bn, about 14% of the total gross issuance this year. Gross issuance dropped by 18% YOY with 5 series of CGB issuance vs. 9 series last year, but net supply was higher than 4% in Q1 2011. Historically funding in Q1 is seasonally low relatively to other quarters as the budget plan is usually approved in the National People’s Congress which is held in the beginning of March.
We expect issuance in Q2 and Q3 to account for about 60% of the total net supply this year. In Q2, MoF plans to issue 12 series of CGBs on benchmark tenors from 1Y to 50Y with an average duration of 13.33 years. It will also issue 6 series of savings CGBs to retail depositors in 3Y and 5Y tenor. We estimate the gross issuance could reach 441bn and net issuance of 264bn, about 29% of the gross and 33% of the net issuance this year. Duration of CGB gross supply is a touch higher than Q1 last year at an average life of 13 years as the 3Y and 5Y auction last Q2 was replaced by a 10Y CGB auction and two 7Y CGB offering.
The 2012 budget pencilled in CNY 250bn local government debt financing need, 25% more than it was last year. Since the launch of independent local government debt financing pilot program in Q4 last year, there has been no debt placement by local government in Q1 and we expect the local government financing program to officially resume sometime in Q2.
With interbank liquidity having normalized, we expect commercial banks to purchase about 75-80% of the net supply in Q2, and issuance companies to absorb 10% of the net supply. Fund management companies (including RQFII fund managers), and security houses areto purchase the remaining about 5-7% of the net supply.
We expect another 100bps cut in the RRR in the next few months and our base case view is that PBoC is unlikely to cut policy rates this year. As such, we expect long-dated CGB yields to be range-bounded and 10Y CGB yields to trade between 3.4-3.8%. Insurance companies will likely take most of the 50Y bond supply (to be auctioned on May 16th), the fifth super long bond placement on the record.
CNH fixed income market: We forecast Q2 net supply of CNH bonds and CDs at RMB 79bn.
CNH fixed income market in Q1 saw a gross supply of RMB 80.7bn and a net supply of RMB 71bn. Approximately 24% of the gross supply and 29.6% of the net supply that we forecast for 2012 has been completed. The gross supply grew by 460% YOY and net supply grew by 376% YoY. The pace of supply is much faster than in Q1 last year when only 10% of the full year gross supply and 11.5% of the full year net supply were placed. We think the revival of primary market activities from Q4 last year has been driven by improving risk appetite as well as attractive pricing to investors compared with Q1 last year.
CD issuance accounted for 58% of the net supply in Q1, and the net supply of CNH bonds was RMB 29.6bn. Compared with the amount of outstanding CDs at about 39% of the total CNH fixed income market, the stronger supply of CDs in Q1 relative to bonds reflected in our view, strong demand for trade financing/short-term CNH loans in Q1.
The top issuers in Q1 were Chinese commercial banks with 62% of the gross supply (primarily in CDs). Policy banks, HK banks and foreign banks accounted for 11%, 8% and 5% of the Q1 gross supply. China and foreign corporations issued 8% and 6% of the Q1 supply.
We expect gross supply in Q2 to climb to RMB 109bn, and net supply to RMB 79bn, about 30% of what we forecast as the full year net supply. While RMB deposit based dropped by 1.7% MOM in February, we think it is largely due to liquidity outflow from the bank deposit to the CD market. If we take the sum of bank deposits with CDs as a measure of total liquidity, this measure grew by RMB 12bn in February.
It seems Asia investors took the lion share in supply by Asia corporate/bank names, and Europe and US investors absorbed significant shares of a number of new issues by American and European corporations. Fund managers continue to dominate the demand, followed by banks, and we saw increasing participation by insurance investors. We expect such diversification trend to persist for the rest of this year.
Although the market seemed to have a stronger appetite for high grade names, the placement of one high yield corporate bond in Q1 and another high yield issuance this week marked the reopening of the CNH fixed income market to high yield issuers after about six months, a fairly positive development so far this year in our view.
Implication of the 2012 foreign debt quota
China’s NDRC set the 2012 foreign debt quota for foreign-funded banks at USD 24bn on March 29th. The new quota likely will be four times the net foreign debt increase by foreign-funded banks in 2011 and the highest annual foreign debt quota over the past decade. The new quota implies a relaxation in foreign debt control on foreign-funded banks, and, in our view, is another step towards capital account liberalization.
For offshore RMB funding (offshore RMB bond funding excluded in the quota) longer than 1Y tenor, which is accounted for in the quota, NDRC requires foreign-funded banks to pre-file the RMB funding amount, tenor and profiles of foreign creditors.
We see three key market implications: (1). The USD 24bn quota will contribute to an equivalent amount of capital inflows this year under foreign borrowing; (2) Provide access to cheaper offshore funding to projects by local corporations; (3). Upward pressure on USDCNH FX forward/CCS and USDCNY onshore forward or NDF. – Please refer to China Rates Strategy: Implication of the 2012 foreign debt quota for details (March 30th 2012)
Title of charts:
Figure 1: Property transaction volume index (yoy % change, 4WMA)
Figure 2: Official PMI’s export orders index (3mma)
Monthly Net FX purchase by PBoC (CNY bn)
Reversal of capital outflow in February
Monthly fiscal deposit growth (CNY bn)
Large OMO redemption in April (CNY bn)
April Liquidity Forecast
Net purchase by banks and insurance companies
Rapid pace of growth in CNH fixed income market (outstanding amount RMB bn)
Q1 issuance breakdown
Quarterly net supply forecast (RMB bn)
Foreign debt by foreign-funded FI
The highest increase in foreign debt by foreign banks
English to Chinese: Swedish baby princess is born General field: Other Detailed field: Journalism
Source text - English Swedish baby princess is born
Sweden’s first royal birth in over three decades came early in the morning on February 23, 2012. A visibly proud and emotional Prince Daniel announced the news to the press gathered at Karolinska University Hospital that his wife Crown Princess Victoria had given birth to a healthy and very cute baby princess at 4.26 a.m. The delivery had been without complications and both mother and baby were doing very well.
When the new parents married in June 2010, interest from the world press and the public was intense, with about 500,000 people celebrating in the streets of Stockholm. On February 23, 2012, the couple again surfaced on front pages and in people’s minds. Some morning commuters in Stockholm speculated about the possible names of the new-born (various betting sites also allowed for people to stake money on their favorite name), and social media sites erupted in a flood of comments about the birth, mostly congratulatory but also more republican in tone.
The Crown Princess was admitted to the maternity ward at 12.50 a.m. on Thursday morning, with Prince Daniel at her side. The birth was expected in early March, but the hospital was prepared even weeks in advance, having blocked off parking spaces and making room in other ways in anticipation of a massive media —and public — interest. During the press announcement, Prince Daniel took the opportunity to ask the press to respect their privacy. “As you can all understand, we have a great need to just be our own little family right now and enjoy this, to us, completely new situation,” Prince Daniel said.
Doctor Lennart Nordström, in charge of the medical procedure at Karolinska, said “There is a radiant, happy new mother with a baby in her arms. The couple glows with happiness.” He took no credit for the royal birth, however, stating the obvious that Crown Princess Victoria did all the work. Prince Daniel was by her side and also assisted with the umbilical cord.
A boost to royalists
Sweden is a constitutional monarchy, often regarded as the world’s most modern such with gender-neutral succession and a relative down-to-earth approach. The Swedish head of state and now proud grandfather, King Carl XVI Gustaf, exercises no political power and does not participate in political life. He performs mainly ceremonial duties and functions. The Swedish monarchy has increased in popularity since Crown Princess Victoria has taken on more and more ambassadorial duties for the country. Her wedding to Daniel gave the Swedish Royal Court a positive boost, and with an addition to the family, the future looks bright indeed.
Following the birth the people of Sweden can expect a series of ceremonial splendor, ranging from the official witnessing by four public representatives to a 42-cannon salute and special church service. The Facebook post by the Swedish Royal Court, meanwhile, quickly garnered thousands of likes, comments and shares. The popular Swedish pastry “princess cake” was reportedly breaking record sales nation-wide. While the Royal couple take some time out to rest and enjoy their bundle of joy, the public will have to savor their pastries and keep guessing on names for the next heir to the throne of Sweden.
The royal bundle of joy
• Born on February 23, 2012 at 4.26 a.m.
• Birth weight 3,280 grams (7 lbs. 4oz.)
• Birth height 51 cm (1’ 8”)
• Second in line of succession to the Swedish throne (after her mother)
• Delivered at Karolinska University Hospital in Stockholm
• Will stay in hospital anywhere from 12 hours to 3 days before moving with parents at Haga Palace, Stockholm
• The Princess’ parents will receive a monthly child allowance from the state, same as all other parents in Sweden
Did you know that…
Swedish hospitals offer parents a complimentary sandwich with non-alcohol sparling drink after the birth?
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Swedish Royal Court
English to Chinese: financial market trading strategy General field: Bus/Financial Detailed field: Finance (general)
Source text - English Strategy
Local Markets Strategy
We are constructive on CNY fixed income market in the first half of 2012 as disinflation, growth deceleration and the lack of capital inflow will allow the central bank to fine-tune its monetary condition towards easing more proactively. As macro indicators and policy environment will likely stabilize in H2, technical factors such as liquidity and bond supply and demand balances (other than trend factors) will become more important drivers for rates market performance.
There are three fundamental factors underpinning our core constructive outlook on CNY rates market in the H1 of 2012. First, sequential real GDP will decelerate to 7.7% YoY and 7.5% YoY in Q1 and Q2, before recover to 8.7% in H2; second, we expect CPI inflation to decline sharply to 3% YoY in Q2; thirdly, capital inflow is unlikely to be as strong as in 2011 as export growth will decelerate, and if coupled with speculative outflow, will likely tighten domestic liquidity. With our projected balance between growth/inflation and risk of capital outflows, we believe monetary policy which has shifted towards easing in December with a 50bps cut in RRR, likely will accelerate in the next two-quarters.
We believe PBoC will primarily employ quantitative tools such as RRR cuts and open market operation to release liquidity and manage money supply growth. We expect about 150-200bps RRR cuts, taking the required reserves for large financial institutions from 21% at present to 19-19.5% in the first half of next year. Any cut in the policy interest rates will have to be justified by much faster pace of disinflation, and for the time being, our base case view is no change in the policy rates.
Outlook on interbank liquidity: We expect at least a 50bps cut in RRR in January (possibly as early as the end of December 2011) and another one in February. In addition to reasons such as the risk of capital outflow and weak growth momentum Q1, there are two more considerations: (a) PBoC bill redemption in January and February will be quite low (total CNY 25bn) relative to other months of the year, and CNY 115bn repo redemption in January; (b) additional required reserve on margin deposit for medium and smaller size banks to drain CNY 320bn in the next nine weeks: the next remaining three scheduled payment will fall on December 15th for
Monthly OMO redemption profile in 2012 (CNY bn)
Source: AAA, PBoC
RRR vs. the stock of PBoC bills
Source: AAA, CEIC
1Y PBoC bill yield vs RRR and 1Y policy deposit rate
Source: AAA, Bloomberg Finance LP
about CNY 80bn, and January 15th for CNY 120bn and February 15th for another CNY 120bn. That is to say in order to keep lending growth and M2 growth at 15-16%, at the beginning of the year, PBoC has to provide base money growth of at least RMB 287bn average per month (assume multiplier of 3.8, was 3.74 by the end of September), and if we assume FX purchase (capital inflow) grew at USD 25bn per month (as it did in 2011), it is still insufficient to prevent the system liquidity from net draining unless PBoC cuts RRR. In the event of capital inflow at less than USD 25bn per month or capital outflow, more liquidity injection is necessary to keep the system liquidity stable. The timing of next 50-100bps cuts in RRR is more likely in Q2 which will allow PBoC to roll over OMO redemption from March - May to June- August to maintain a decent cushion on liquidity operation.
Note in 2011, PBoC reduced the outstanding PBoC bills by about CNY 2trn, and switched to RRR hikes (six RRR hikes in 2011), which were more effective in reducing money multiplier which then directly slowed down money supply growth. In the next few months, we expect PBoC to use a combination of RRR cuts and increasing bill issuance to smooth out the impact on domestic liquidity and to keep money supply growth at a reasonable pace. However, if liquidity condition becomes more volatile, it is possible for PBoC to reduce or pause long-dated bill auctions (1Y or 3Y), and switch to predominantly 3M PBoC bills to manage liquidity with desired flexibility.
We believe the 1Y PBoC bill yield should not deviate much (-10-20bps) from the 1Y policy deposit rate (3.5%) in the first half of 2012, as we do not call for policy rate cut for now, downward adjustment on the auction yield of 1Y PBoC bill is only possible when liquidity becomes more abundant unless PBoC intends to signal rate cuts.
We expect net liquidity inflow to the interbank market to help bring money market rates 50-100bps lower from where they are now (overnight repo at 2.95% and 7D repo rate at 3.51%) before the middle of 2012. Currently 1Y Repo swap curve is pricing in 3MMA of 7D repo rate at 2.63% by the end of 2012, which is in line with our expectation. However, in the near-term, the relative stickiness of the 7D repo fixing rate given the year-end seasonal liquidity demand, and the extent of liquidity easing being priced in on the Repo IRS curve argues for the outright level of CNY IRS curves to be relatively range bound (within 10-15 bps range).
We expect 3M Shibor rate to fall towards 4.75-4.5% in H1 next year. It will remain stubbornly sticky in the near-term because of its higher term premium than money market rates, which means it tends to fluctuate with changes in policy deposit rates (which we call for no change in 2012), rather than with short-term liquidity. If and when Shibor fixing banks get more comfortable with outlook for liquidity easing, they will price in less term premium on 3M Shibor fixing.
3M Shibor fixing vs. RRR and 1Y policy deposit rate (%)
English to Chinese: Employees first: Making SABIC a better place for our people General field: Bus/Financial Detailed field: Business/Commerce (general)
Source text - English (In Focus)
Employees first: Making SABIC a better place for our people
Our people are at the heart of SABIC and our success depends on motivated, productive and engaged employees working towards the same objective. SABIC is committed to attract and retain the best diverse talent, provide them with opportunities to develop their skills and empower them to take charge of their careers. We strive to promote a performance driven culture that is based on values and continuous learning. In essence, at SABIC, we aim to be the “employer of choice” and have launched a number of initiatives to achieve this.
Over the last two years, we have stepped up our efforts to develop and grow the potential of our employees. “We look at each employee as an individual with personal needs, challenges and aspirations,” says Eduardo Pérez-Cejuela, Director of Human Resources, Asia. “As we drive performance and growth in SABIC, we are committed to provide the best development opportunities for our people, no matter where they are in the organization.”
This includes increasing opportunities for staff to develop professional competencies as well as leadership skills through investments in Learning and Development programs. We also strive to meet the aspirations of our employees for career development, an integral component of our Talent Review Process. Some of these opportunities include movement to new roles, and exposure to cross-regional work and bubble assignments.
Growth through Learning and Development
It is important that we pay close attention to the development needs of employees from all levels and functions. SABIC’s Learning and Development (L&D) program is designed to meet this need by offering more than 100 courses in the areas of Leadership, Soft Skills, Sales and Marketing, Finance, Supply Chain Management and Technical training. These customized programs – conducted by external instructors or our own internal specialists – allow our staff to acquire skills and know-how that will facilitate their day-to-day work, and reinforce their knowledge of the company’s core values.
Taking an unconventional approach to training, SABIC’s training programs are often specifically tailored, rather than generic off-the-shelf training. John Jiang, Asia & Pacific Learning Leader, explains: “Every company is different. As such, a program that is effective for one company may not be suitable for another. This is why at SABIC we do not rely entirely on external training programs. Instead, we design specific programs that are unique to SABIC to exemplify our values.”
[Box story/ highlight] After attending “Tango”, a course on core business skills held in September in Shanghai, Zhao Feng, Partnership Leader of Asia IT Service, IT ERP Deployment (RHQ CN), noted, “I had initially expected the training to be conducted on a more general level. It turned out that the training was very relevant to our business needs. I particularly enjoyed the market simulation game, which provided deeper insights into the customer and talent markets. Overall, the knowledge gained was very valuable in helping me stay focused on the business targets.” She added, “It also gave me the chance to network with and learn about best practices from colleagues from other countries, SBUs and Functions.”
Some 700 employees from across different functions are expected to benefit from the diverse range of courses available this year. This represents an increase of 25% compared to the number of employees who took part in the training programs last year.
With the implementation of a SABIC-wide Learning Management System at the end of Q1 2012, it will be simpler than ever to register for programs and to check on course availability. Employees will be pleased to know that the new SABIC Academy in Riyadh, Saudi Arabia, a global center for leadership training, will open in January next year. This major milestone is a further demonstration of SABIC’s commitment to the development and learning of employees.
Talent Exchange and Professional Exposure
We also strive to provide employees with cross-functional and cross-regional exposure as they grow in their careers. SABIC employees are strongly urged to discuss their career goals and learning and development needs regularly with their direct managers, so as to fully explore and tap into the wide range of opportunities within the company. Through these reviews, employees are encouraged to take charge of their own careers and chart their development milestones, progression and professional growth, in close working with their managers.
To grow their learnings beyond their current role, qualified employees can apply for in-country job postings within or outside their Function and Business Unit via the internal job posting program. Since its inception in April 2010, the internal job posting initiative has successfully placed several employees in positions across our Asia regional offices.
For Nur Hidayah Ahmad, who transferred to Human Resource Learning & Development in March 2011 after nearly two years with Human Resource Operations, the change was an opportunity for her to be exposed to an area that she has always been passionate about. “The internal job posting is a great initiative that gives SABIC employees priority in applying for a specific role within the company before external recruitment. One of the best things about my new role is meeting new people from our worldwide offices and acquiring a brand new perspective on employee development,” she remarked.
Eleven Yang, Product Specialist, LLDPE, Polymer, who first moved to Shanghai to assume the role of Assistant Sales Manager in April 2010 from the Shenzhen office, also shared her job posting experience: “When I first learned about the vacancy in Shanghai, I talked to my supervisor about my interest in the position. He not only respected my decision, but gave me his full support. Over the past one and a half years, I have learned to see things from a more macro perspective and have become a better communicator. Thanks to this initiative, I am now also able to work and live closer to my family in East China.”
Taking on her new position as an Insurance Analyst, Ong Loo Ee also shared: “I have been involved in the credit function for almost eight years and was looking to further challenge and develop myself. I enjoy working in SABIC and the opportunity of job mobility within the company was something that I greatly appreciated.”
Bubble assignments – where employees are temporarily assigned to another area or environment – and cross-regional placements are also available to qualified employees looking to broaden their expertise.
Sylvia Hue from the Capital Treasury department in the Singapore office, for example, shared that her on-going three-month bubble assignment in the Netherlands has helped her to grow expertise and knowledge in her field of work. “Shortly after discussing my desire to learn more about operations in the other regions with my manager, the perfect opportunity came along. Through this assignment, I am exposed to the ongoing Treasury projects in Europe and learn about both front and back office Treasury Operations. I look forward to taking home the best practices which are applicable to my work here in the Asia Pacific region. This opportunity has also given me greater visibility of how the global organization works as a whole. A truly priceless experience!” Sylvia returns to Singapore this December.
Joseph Wong, a former Talent Management Leader based in Singapore, took on a different portfolio as the Human Resource Business Partner for the Corporate Functions division in America. Similarly, Lennard Markestein from the Netherlands recently relocated to Shanghai, China, where he is now Vice President, North Asia Specialty Film & Sheet and Global Film . Lennard mused: “My new role requires me to tap on the knowledge gained from my previous tenure as the Global Product Market Director for Specialty Film & Sheet, while allowing me to develop my ability to lead a team with diverse and unique cultures. It gives me an even better perspective on the needs of both the customers and the market in Asia. It is a great experience and I encourage my colleagues to seize the opportunity to learn from an overseas assignment when it arises!”
Successful Career Journeys
Being a global company, these are a variety of opportunities for SABIC employees to experience various facets of the business, broaden their horizons and, ultimately, grow their careers. Here’s what other colleagues have to say about professional exposure and growth opportunities in SABIC…
• “I saw the transfer as an opportunity to apply my technical know-how to a new role, where I could expand my skills and perspectives. Through working with new colleagues and meeting customers in my new position, I feel that I am able to contribute more than ever.” –Matsumiya Rei, who joined Innovative Plastics, Pacific Auto Marketing team in December 2010, was formerly a Technical Service Engineer, and has been with SABIC for over seven years.
• “After working in the same department and on the same product for over four years, I saw this as a chance to challenge myself to move forward and broaden my scope. Now, I am responsible for the sales of Base Product in Asia (excluding India). By dealing with a wider range of customers, I have learnt more about their different needs as well as the entire product chain. This new challenge also improved my problem-solving skills and my ability to think in a more strategic way.” – Previously an Assistant Sales Manager, Lu Wei Li, now Regional Sales Manager for Performance Chemicals, has been with SABIC for five years.
• “It is important that before seeking out job posting opportunities, we take an objective approach to evaluate our own competencies and experiences. For me, this process involved talking to my peers and my managers. And at the end, this was what helped me to decide if I am ready for a change in my job responsibilities and the kind of new responsibilities that I am suited for. The learnings in my new role is a motivation for me to develop and grow, and would also be beneficial to my career.” – Momose Masayuki, a former Color Technologist, is currently a Product Marketing Manager with the Innovative Plastics BU.
Earlier this year, SABIC emerged as one of China’s Top Employers 2011 - an award from the Corporate Research Foundation (CRF) Institute, a leading global research institution in the field of human resource policies. The award is not only an acknowledgement of SABIC’s effort, but also an affirmation that we are moving in the right direction. Scoring high in four segments evaluated – Benefits, Working Conditions, Learning and Development, and Company Culture – SABIC demonstrated our commitment to building a wholesome workplace for our staff, underpinned by initiatives to develop and support talent. We thank you for being part of the team, as we continue to strive to make SABIC “the employer of choice”.
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I am now a full-time postgraduate student in Applied Translation Studies in UEA. Before coming to UK, I have been a freelance translator for one year and have translated over 100,000 words focusing on finance and accounting.
Very good command of both English and Chinese.
Keywords: english to chinese translator, finance，accounting，business，economy.