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06 September 2012

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Macro View

Waiting for Beijing

The Big Call

Weak outlook for exporters

Feeble EU demand is not the only thing ailing Chinese exporters. They are also contending with a rising cost-base and stronger overseas competitors.

Consumer China

Infant milk formula – tainted love

Ongoing mistrust of domestic infant milk formula brands following a string of safety scandals has proved a boon for multinational producers in this fast-growing, defensive sector.

Beingmate – growth potential for untainted domestic brand

As one of the few domestic infant formula makers not to be tainted by scandal, Beingmate has potential to grow, especially once a new production facility comes online later this year

Nestle – Pfizer acquisition a chance to rebuild in China

The proposed acquisition of Pfizer Nutrition will boost Nestle’s faltering attempts to tap into China’s infant formula milk market.

Danone – failing to cash-in on its import popularity

Danone’s Dumex brand is the number-two infant milk formula brand in China, but the French food giant is failing to exploit the growing popularity of its unofficially imported products.

Yashili – still struggling to repair the damage

Domestic formula milk maker Yashili has failed to reassure higher-tier consumers about the safety of its products following its implication in the 2008 melamine scandal.

Mead Johnson – China story intact despite short-term slowdown

The number-one infant milk formula maker in China is suffering a sales slowdown, but its long-term growth prospects remain strong.

Financial China

Alarm bells ring over overdue bank loans

While NPLs remain at low levels, the sharp increase in overdue loans is alarming

Selected financial charts

A selection of key financial data over the past fortnight

Capital Intensive China

Steel hits the buffers

A confluence of factors suggests that the actual decline in steel output in August may have been even steeper than semi-official statistics show

Gridlocked

A slowdown in power-grid investment is hurting suppliers and hampering capacity expansion plans.

Best of Chinese Commentators

Further delays to Budget Law amendment

A proposed revision to China’s Budget Law that would have enabled local governments to issue bonds directly has been delayed, generating heated debate among economists and academics

Tax reforms accelerate

A pilot scheme to replace business tax with value-added tax in several provinces could help ease the tax burden for service-sector companies.

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