China's CICC eyes Middle East, South-east Asia in global push
[NEW YORK] China International Capital Corporation (CICC), one of the nation's largest brokerages, is seeking to tap the growing demand for cross-border financial services in the Persian Gulf and South-east Asia as the firm pushes its global expansion.
Beijing-based CICC is gearing up to open a new branch in Dubai to target sovereign wealth funds and conglomerates in the Gulf region, according to Wang Hanfeng, deputy president for CICC International. It's also exploring more South-east Asian markets, after having opened a representative office in Vietnam last year and a Singapore unit in 2008.
'If we don't connect with the world and just focus our efforts on the domestic market, our role and influence will wane,' Wang said. 'We aim to form a bridge for Chinese firms to go abroad and overseas firms to invest in China.'
The company will now also prioritise deploying resources to areas including Latin America, central Asia as well as Japan and South Korea to better support China's Belt and Road Initiative, Wang said.
Since the inception of the initiative in 2013, China has managed to extend its global influence through the development programme that mainly funds infrastructure for member countries. Beijing is now actively seeking closer ties with trade partners in regions including South-east Asia as it braces for growing tensions with US President Donald Trump's US administration.
The overseas expansion of Chinese brokerages also dovetails with the nation's strategy for its firms to 'go global' and a drive to cultivate two to three top-class Chinese investment banks by 2035.
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The push comes amid increasing tension with the US over tariffs and as China's economy has struggled to regain traction. The firm's profit dropped 7.5 per cent in 2024 from a year earlier as brokerage commissions and investment banking revenue slid. Underwriting and sponsoring fees from equity financing dropped almost 37 per cent as initial public offerings and follow-on share sales in China plummeted.
CICC aims to participate in the energy transition and infrastructure construction drive in the Gulf region by providing structured financing and services, according to Wang. It will cater to increasing demand from both Chinese firms and their counterparts in that region for cross-border investment, share offerings, as well as mergers and acquisitions, he said. There's 'great synergy' between the two sides in areas including green energy, he said.
The firm expects stronger ties and more cooperation between companies in China and South-east Asia as the latter seeks to upgrade the new energy, high technology and consumption sectors. CICC can play to its strength by facilitating two-way financing and investment services, said Wang.
Peer CGS International, a unit of China Galaxy Securities, is also looking to help boost cross-border investments by Chinese and South-east Asian firms amid optimism over stronger ties between the two sides given the US tariffs, CEO Carol Fong told Bloomberg Television in early April.
CICC will add more headcount in both the Gulf region and South-east Asia to aid its local expansion, Wang said, without disclosing specific targets.
The company, a leading underwriter and sponsor for initial public offerings in Hong Kong, also expects listing activities in the city to pick up in 2025 from the past few years with more big deals above US$1 billion. The benchmark Hang Seng Index has gained 9.5 per cent this year, ranking among the best-performing major indexes globally.
CICC's global operations began as early as 1997 when it set up a Hong Kong unit, the predecessor of CICC International. Its global business operations have over the years expanded to amass HK$194.4 billion (S$32.8 billion) in assets as at end-2024, with its net profit contributing to about 50 per cent of the group's total last year. BLOOMBERG
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AsiaOne
34 minutes ago
- AsiaOne
China-backed militia secures control of new rare earth mines in Myanmar, World News
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Now, in the hillsides of Shan state in eastern Myanmar, Chinese miners are opening new deposits for extraction, according to two of the sources, both of whom work at one of the mines. At least 100 people are working day-to-night shifts excavating hillsides and extracting minerals using chemicals, the sources said. Two other residents of the area said they had witnessed trucks carrying material from the mines, between the towns of Mong Hsat and Mong Yun, toward the Chinese border some 200km away. Reuters identified some of the sites using imagery from commercial satellite providers Planet Labs and Maxar Technologies. Business records across Myanmar are poorly maintained and challenging to access, and Reuters could not independently identify the ownership of the mines. The mines operate under the protection of the United Wa State Army (UWSA), according to four sources, two of whom were able to identify the uniforms of the militia members. The UWSA, which is among the biggest armed groups in Shan state, also controls one of the world's largest tin mines. It has long-standing commercial and military links with China, according to the US Institute of Peace (USIP), a conflict resolution non-profit. Details of the militia's role and the export route of the rare earths are reported by Reuters for the first time. University of Manchester lecturer Patrick Meehan, who has closely studied Myanmar's rare earth industry and reviewed satellite imagery of the Shan mines, said the "mid-large size" sites appeared to be the first significant facilities in the country outside the Kachin region in the north. "There is a whole belt of rare earths that goes down through Kachin, through Shan, parts of Laos," he said. China's Ministry of Commerce, as well as the UWSA and the junta, did not respond to Reuters' questions. Access to rare earths is increasingly important to Beijing, which tightened restrictions on its exports of metals and magnets after US President Donald Trump resumed his trade war with China this year. While China appears to have recently approved more exports and Trump has signalled progress in resolving the dispute, the move has upended global supply chains central to automakers, aerospace manufacturers and semiconductor companies. The price of terbium oxide has jumped by over 27 per cent across the last six months, Shanghai Metals Market data show. Dysprosium oxide prices have fluctuated sharply, rising around one per cent during the same period. Chinese influence A prominent circular clearing first appears in the forested hills of Shan state, some 30km away from the Thai border, in April 2023, according to the satellite images reviewed by Reuters. By February 2025 — shortly after the Kachin mines suspended work — the site housed over a dozen leaching pools, which are ponds typically used to extract heavy rare earths, the images showed. Six km away, across the Kok river, another forest clearing was captured in satellite imagery from May 2024. Within a year, it had transformed into a facility with 20 leaching pools. Minerals analyst David Merriman, who reviewed two of the Maxar images for Reuters, said the infrastructure at the Shan mines, as well as observable erosion levels to the topography, indicated that the facilities "have been producing for a little bit already". At least one of the mines is run by a Chinese company using Chinese-speaking managers, according to the two mine workers and two members of the Shan Human Rights Foundation (SHRF), an advocacy group that identified the existence of the operations in a May report using satellite imagery. An office at one of the two sites also had a company logo written in Chinese characters, said one of the workers, who spoke on condition of anonymity in order to discuss sensitive matters. The use of Chinese operators in the Shan mines and transportation of the output to China mirrors a similar system in Kachin, where entire hillsides stand scarred by leaching pools. Chinese mining firms can produce heavy rare earth oxides in low-cost and loosely regulated Myanmar seven times cheaper than in other regions with similar deposits, said Neha Mukherjee of London-based Benchmark Mineral Intelligence. "Margins are huge". Beijing tightly controls the technology that allows for the efficient extraction of heavy rare earths, and she said that it would be difficult to operate a facility in Myanmar without Chinese assistance. 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Some of those fighters are also closely monitoring the mining area, said SHRF member Leng Harn. "People cannot freely go in and out of the area without ID cards issued by UWSA." Shan state has largely kept out of the protracted civil war, in which an assortment of armed groups are battling the junta. The fighting has also roiled the Kachin mining belt and pushed many Chinese operators to cease work. China has repeatedly said that it seeks stability in Myanmar, where it has significant investments. Beijing has intervened to halt fighting in some areas near its border. "The Wa have had now 35 years with no real conflict with the Myanmar military," said USIP's Myanmar country director Jason Towers. "Chinese companies and the Chinese government would see the Wa areas as being more stable than other parts of northern Burma." The bet on Shan's rare earths deposit could provide more leverage to China amid a global scramble for the critical minerals, said Benchmark's Mukherjee. "If there's so much disruption happening in Kachin, they would be looking for alternative sources," she said. "They want to keep the control of heavy rare earths in their hands. They use that as a strategic tool." [[nid:713792]]
Business Times
2 hours ago
- Business Times
China stocks soar on AI, US-China trade hopes. Who are the country's ‘Terrific Ten' firms?
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The conclusion of consensus on a trade framework between the US and China this week also gave a boost to Chinese stocks, although some gains were pared after US President Donald Trump said he would unveil unilateral tariff rates within two weeks. The S&P 500, much of it driven by the 'Magnificent Seven' technology giants, has risen just over 2 per cent year-to-date. On the other hand, Hong Kong's Hang Seng Tech Index, which tracks the 30 largest technology companies listed in Hong Kong (including seven of the Terrific Ten) has surged around 24 per cent in the same period. In the last couple of months, global banks HSBC, Morgan Stanley, Citibank and Goldman Sachs all upgraded Chinese equities to overweight, many citing attractive valuations among technology stocks and strategic government support for the tech sector. Much of the rally's momentum has also been carried by artificial intelligence-led optimism, reminiscent of the artificial intelligence (AI)-boom in 2024 that led to the strong performance of the Magnificent Seven stocks. To some, China's technological potential is no longer perceived as merely capitalising on 'one to n' capabilities – i.e. reproducing existing innovations at scale – but has showcased its capabilities to create 'zero to one' innovation from the ground up. 'DeepSeek's advancements underscore the immense potential of China's AI ecosystem,' said Terence Lim, equities portfolio manager at Eastspring Investments Singapore in a report. 'Many companies are not only innovating rapidly but also trading at much more attractive valuations compared to their US counterparts.' Morgan Stanley upgraded its outlook on China to overweight, based on earnings beat for MSCI China companies after four straight years of quarterly misses. While the fallout from Trump's latest tariffs is likely to quell global growth significantly, strong corporate earnings may mean that the 'Terrific Ten' remain resilient in the coming months. We bucket the Ten into three categories – internet giants, e-commerce and consumer goods, and electric vehicles – and discuss upcoming trends to watch. Internet giants: Tencent, NetEase, Baidu, SMIC China's internet tech companies have moved quickly to capitalise on the 'DeepSeek effect'. Tencent, for instance, has incorporated DeepSeek's R1 model into its 'AI Search' functions within Weixin, as well as rolling out an upgraded iteration of its proprietary Hunyuan T1 model. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The digital ecosystem giant, which operates WeChat and its mainland equivalent Weixin, has seen its share price surge 24 per cent since the beginning of the year. Also in this bucket is China's largest semiconductor foundry SMIC, which has surged nearly 40 per cent year-to-date, driven by the AI hype and a government push for self-sufficiency in chip production. However, potential chip tariffs from the US may slow its runaway share price. Others include gaming operator NetEase, and the search engine provider Baidu, both of whom have yet to truly achieve lasting growth through AI adoption. While each has expanded into adjacent areas – music streaming in NetEase's case, and autonomous driving for Baidu – neither has managed to step out from the shadow of dominant rivals like Tencent and Alibaba. Yet, relatively cheap earnings multiples compared to China's other tech giants may support their bull cases. E-commerce and consumer goods: Alibaba, JD, Meituan, Xiaomi Standing tallest among the AI-driven resurgence of Chinese stocks is Alibaba, the e-commerce giant founded by Jack Ma. 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Morgan Stanley chief China economist Robin Xing said that recent memories of regulatory crackdowns, structural deleveraging and deflationary pressures have left a deep imprint on investors, while recent tariffs may cause further downside for Chinese equities. The tariffs may prompt Beijing to accelerate its planned RMB 2 trillion yuan stimulus package sooner than expected. 'That said, this may only partly offset the tariff shock,' Xing noted.
Business Times
2 hours ago
- Business Times
Airbus revises up 20-year jet demand forecast despite trade tensions
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