Welcome to Nikkei Asian Preview.
This will be a big week for China watchers, with the National People’s Congress running through Thursday in Beijing. The meeting kicked off last Friday with a controversial proposal of new national security laws for Hong Kong that drew international criticism.
On Wednesday, a Canadian court will rule later that day on the extradition case brought by the U.S. against a top Huawei executive.
Coronavirus control measures will end — or at least relax — in Japan, Thailand, Myanmar and the main Philippine island of Luzon this week. Elsewhere in Asia, the Bank of Korea meets on Thursday, and GDP figures are due from Singapore and India. Even more economic data is expected from Vietnam.
Keep up with our reporting by following us on Twitter @NAR.
Takeout doubts hit Meituan Dianping
The past three months have posed a huge challenge to Meituan Dianping, the Beijing-based, Hong Kong-listed food delivery giant that reports first quarter earnings on Monday. Fearing infection, diners have lost their appetite for takeout. Meituan’s ticketing business has also suffered from the shutdown of cinemas and tourist attractions. Investors will watch for signs of recovery as China reins in the coronavirus.
Uber HQ to HK?
After confirming that it will shut down 45 offices globally, including its Asia Pacific headquarters in Singapore, ride-hailing giant Uber is expected to make a major announcement in Hong Kong on Tuesday. Uber’s business still remains in a legal gray area in Hong Kong, with dozens of its drivers prosecuted since it entered the market.
Singapore reveals new support for business
Singapore will allow more business to reopen as the “circuit breaker” period to curb coronavirus infections ends on June 1. But it will take months for all activities to resume, further weighing down an economy that is estimated to have contracted 2.2% in the first quarter of this year. The official quarterly figure will be announced on Tuesday, as well as additional support measures for affected businesses.
Philippine Congress debates ABS-CBN license
Hearings will begin on Tuesday at the Philippine House of Representatives on the franchise of leading broadcaster ABS-CBN, which went off air on May 5 after its 25-year license expired.
Background: President Rodrigo Duterte, whose coalition controls Congress, has threatened to block the franchise renewal, alleging that the network did not air his campaign ads during the 2016 election.
What’s at stake? 11,000 people employed by ABS-CBN, and press freedom amid fears of weakening democracy in the Philippines.
Li & Fung delists from HKEX
After being traded on the Hong Kong Stock Exchange for almost three decades, Li & Fung will delist on Wednesday after shareholders voted in favor of the founding family’s bid to take the company private. The world’s largest sourcing company has lost about 95% of its value from its peak in 2011.
Background: Hong Kong’s Li & Fung plots future as global supply chain frays
Canada ruling on Huawei extradition case
The British Columbia Supreme Court will decide on Wednesday the fate of Meng Wanzhou, CFO of Huawei Technologies. The U.S. has sought Meng’s extradition after her arrest in December 2018 by Canadian officials acting on a U.S. warrant for charges including bank fraud to violate sanctions against Iran.
If Canadian prosecutors fail to establish that the charges against Meng are crimes in Canada as well as in the U.S., the Huawei executive could be freed after over a year of house arrest in Vancouver.
Cover story: Meng’s case has become a proxy for the U.S.-China standoff — and placed Canada in the crosshairs.
Annual results from Nissan Motor
Nissan Motor on Thursday will announce full-year earnings for the year ended March. Investors will be looking closely at the announcement of a midterm business plan through March 2023, during which the carmaker plans to cut excessive capacity. Nissan, which ended the fiscal year with a net loss, will begin sharing global production facilities with its alliance partners Renault and Mitsubishi Motors to make more efficient use of their plants. Another priority will be restoring the relationship with French carmaker Renault, which has been strained since former Nissan chairman Carlos Ghosn’s arrest by Japanese authorities in November 2018.
Another extradition: Ghosn fled custody in Japan with the help of three individuals, two of whom have been arrested by U.S. authorities acting on a warrant from Japan.
China’s NPC ends annual meetings
Chinese lawmakers will wrap up the weeklong National People’s Congress by passing several bills, including a motion to enact national security laws in Hong Kong, which would allow Beijing to further clamp down on dissent in the semi-autonomous city.
Premier Li Keqiang is expected to hold a news conference to deliver a summary of the policy directions deliberated. The end of China’s largest annual political gathering marks a shift to political and economic normalcy after the coronavirus — albeit with infection prevention measures in place.
The party line: Li will likely defend China’s handling of the outbreak in response to international calls for accountability, and reiterate the government’s key economic policies to sustain growth in the second half of the year. But analysts do not expect a V-shaped recovery as many of China’s trading partners remain in lockdown.
Related: For the first time in three decades, China did not announce an economic growth target.
Catch up on our coverage of this year’s NPC, which was delayed for two months by the pandemic.
Revised GDP estimates from India
A slowdown was visible long before India first imposed a countrywide lockdown on March 25, and the effects of sluggish investment and weak consumer demand are expected to materialize when India announces provisional annual growth estimates on Friday.
Earlier this year, the government projected 5% GDP growth for the fiscal year that ended in March. But analysts expect a downward revision to 4.1%. The pandemic’s impact will be more clearly seen at the end of this current fiscal year when, according to some estimates, the growth rate may slip below 1%.
Brighter monthly data from Vietnam
A rebound in domestic demand is expected to lift Vietnam’s economic figures for May.
Recap: Figures declined in April as the country applied nationwide social-distancing measures for more than three weeks, depressing retail sales by 20.5% and export revenue by 18.4%
Two scenarios: Vietnam’s National Assembly began its sessions last week, and may approve an adjusted GDP growth target lower than the original 6.8%. The best case scenario sees Vietnam’s GDP rising some 4.4% to 5.2%. But if trading activities with key partners do not resume until the final quarter, growth will be downgraded 3.6% to 4.4%.
Go deeper: Vietnam and Mekong peers pay economic price despite low virus toll
South Korea national assembly opens
The four-year majority of South Korea’s Democratic Party begins on Saturday, when the 21st National Assembly begins its term. The party led by President Moon Jae-in won 180 seats out of 300 in April’s legislative elections, the first held in Asia amid the coronavirus pandemic. Now the party has 177 seats after expelling one member for a corruption scandal, and two returned to their own minor parties. First on the agenda will be passing a third supplementary budget to create 550,000 new jobs.