Tuesday, November 15, 2016
Philippines growth powers ahead at 6%; Snapchat prepares for IPO; A lavish wedding and cash-hit Indians
1 Philippines growth powers ahead at 6% (Straits Times) Neither Donald Trump's protectionist ambitions nor Rodrigo Duterte's rants against the US are proving to be enough to derail the Philippine economy's momentum as one of the fastest-growing in the world.
Economists surveyed by Bloomberg News see growth exceeding 6 per cent until 2018. Gifted with a burgeoning middle class and backed by $50 billion of revenue from remittances and outsourcing, the Southeast Asian economy is getting an additional boost from President Duterte's $160 billion-infrastructure plan.
Political risks "haven't transpired into concrete policies," said Gundy Cahyadi, an economist at DBS Group Holdings Ltd. in Singapore. "We should pay more attention to hard data, which point to very robust growth prospects for the Philippines, given strong domestic demand."
While the Philippines hasn't been immune to the financial market rout since Trump's shock win in the US election, strong domestic growth drivers have made it more resilient to global shocks compared to export-dependent Asian nations from Singapore to South Korea. Consumer spending makes up about 70 per cent of the economy.
At the same time, Duterte has pledged to ramp up spending on roads, airports, seaports and railways to lure investors and create jobs. The Philippines has one of the lowest government debt ratios in Southeast Asia, at 40 per cent of GDP, giving it room to boost spending.
2 Snapchat prepares for IPO (The Guardian) Messaging app Snapchat has filed confidentially with the US Securities and Exchange Commission for an initial public offering, sources familiar with the situation said.
The filing puts the Venice, California-based company one step further towards its IPO, which sources say could come as soon as March and value it at $20bn to $25bn, making it one of the biggest technology offerings in recent years.
Under America’s Jumpstart Our Business Startups Act, companies with less than $1bn in revenue can secretly file for an IPO, allowing them to quietly test investor appetite while keeping financials confidential.
Snapchat started in 2012 as a free mobile app that allows users to send photos that vanish within seconds. It has more than 100 million active users, about 60% of whom are aged 13 to 24, making it an attractive way for advertisers to reach millennials. Awash in venture funding, the company raised $1.81bn in May, which valued it at about $20bn, media reports said at the time.
But investors worry that Snapchat’s advertising sales, which began last October, is the company’s only significant revenue source. Snap in September started describing itself as a camera company, and earlier this month it debuted its $130 video-camera sunglasses.
3 A lavish wedding and cash-hit Indians (BBC) The lavish wedding of the daughter of an Indian politician has sparked outrage as millions across the country are in the midst of a cashflow crisis. The five-day wedding of businessmen and ex-state minister G Janardhana Reddy's daughter, Brahmani, is estimated to cost about 5bn rupees ($74m; £59m).
But with gold-plated invitations and Bollywood stars expected to perform, the nuptials have proved controversial. Critics have described it as an "obscene display of wealth".
The wedding kicked off just days after the Indian government announced it would scrap 500 and 1,000 rupee notes in a crackdown on undeclared wealth, making redundant the vast majority of cash that Indians use on a daily basis. Millions of Indians have been standing in queues in an effort to deposit or exchange the old currency and frustration is widespread.
Mr Reddy was quoted as saying that he had mortgaged properties in Bangalore and Singapore to raise money for the wedding and that all payments were made six months ago when the planning started. His political opponents meanwhile have used it to speculate if the prime minister's drive against illegal "black money" would include elites.
A former member of Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) in Karnataka state, Mr Reddy recently spent three years in jail on corruption charges, which he denies, and was freed on bail last year.