Asia Pacific

The plight of South Korea’s 6m contract workers and the polarisation of the 18m-strong workforce goes to the heart of the country’s reform challenge, the Financial Times reported. President Park Geun-hye has put the labour market at the core of structural reforms aimed at reviving economic growth. South Korea’s economy grew just 0.4 per cent in the last three months of last year from the previous quarter — the slowest pace for two years. “Our economy is at a crossroads,” she said recently in a meeting with business leaders.

The troubled Chinese property developer, Kaisa Group, defaulted on its overseas debt, a situation that could make Western investors more wary of the country’s real estate market, the International New York Times DealBook blog reported. Once a darling of global money managers, the developer, with its trail of financial problems, is now a case study for the risks of investing in China. For years, big investors plowed money into Kaisa, attracted by the tempting returns and the country’s soaring real estate market.

Chinese policy makers are dealing with a financial conundrum. Overall economic growth is slipping, which argues for looser monetary policy. But the risk is that any new money is diverted to the country’s frothy stock markets, the International New York Times reported. Against this backdrop, the central bank and securities regulator appear to be taking coordinated action. On Sunday, China’s central bank freed up roughly $200 billion for new lending, a widely expected stimulus measure devised to pump more money into the economy.

Lawmakers in Cyprus passed key insolvency laws designed to open the taps for more international bailout cash, The Wall Street Journal reported. The vote makes it possible to operate foreclosure laws that international creditors have demanded as a condition for extending more loans to Cyprus. Recession, high unemployment and declining incomes have produced defaults on more than half of all private loans. The new laws should make it easier for banks to demand payment or seize assets, thereby reducing the banks’ own liabilities.

Things have gone further south for Jones the Grocer Singapore (JTG), three months after the gourmet grocer from Down Under assured that it was business as usual, The Straits Times reported. The Singapore arm of the Louis Vuitton-backed Australian gourmet cafe and retail chain has been placed under judicial management, and its assets are now up for public sale.

Chinese economic expansion cooled to 7 per cent in the first quarter of this year, a figure that exceeded forecasts for a decline below the crucial 7 per cent threshold, but adding to fears that the world’s second biggest economy is facing difficulties, the Irish Times reported. The latest figure was better than the forecasts by multiple institutions that first-quarter growth would fall slightly below 7 per cent due to weak investment and demand.

The state of Jammu Kashmir is heading towards insolvency as its treasury is empty, The Tribune reported. About 50 per cent of the government employees, pensioners, daily wagers and casual labourers have not received salaries. “It is a grim situation and there are no chances of the money coming anytime soon,” said a source in the government. Sources confirmed that Rs 1,400 crore was released in March but that was exhausted to meet bills that were pending for months.

Just months after resigning, the former head of the embattled Chinese property developer, the Kaisa Group, returned unexpectedly to the helm, raising doubts about whether the company’s rescue by a rival will move forward, the International New York Times DealBook blog reported. The surprise comeback on Monday of the chairman and chief executive, Guo Yingcheng, is the latest twist in the Kaisa story. Once a darling of global investors, Kaisa started to stumble last fall, after the government blocked the sale of some of its properties in Shenzhen, its largest market.

A company that shares its director with the Noggi Frozen Yogurt chain has entered voluntary administration, SmartCompany.au reported. Stewart Free and Bradd Morelli of Jirsch Sutherland were appointing administrators of SKS Partners on April 9. An investigation by SmartCompany has revealed SKS Partners has close ties with the franchised Noggi Frozen Yogurt chain, which was founded by John Suh in 2009 during the height of the frozen yoghurt craze in Australia.

Hebei Financing Investment Guarantee Group, the country’s second largest financing guarantee company has lost its ability to guarantee nearly 50 billion yuan worth of loans, signalling the spread of risk in the country’s financial system, The Australian reported. According to report from Caixin, the company is no longer in the position to guarantee loans, and scores of banks, trusts, brokers and funds are facing the prospect of a default on their loans. The company is a fully owned subsidiary of the Hebei provincial government.