News International ANTLY IN H1 2014

Hong Kong Though Train is expected to be launched in the fourth quarter of 2014, and will provide a new investment channel for institutional and individual investors who meet the requirements. We believe that it will help stabilise, and bring confidence to, the capital markets, enhancing their overall strength and helping to develop the IPO market.”

Looking at the global capital markets, IPO activity in all the main exchanges were much more active compared to the first half of 2013. The United States continued to lead the way in the first half of 2014, and in terms of the total value of IPOs, the fund raised on the NYSE and Nasdaq were RMB 200.9 billion. London came second, with fundraising equal to RMB 116 billion.

CRISIS

banks and corporations are holding could end up damaging the economy. The ECB is lending money to financial institutions that put it back into the ECB, which is a vicious circle and today Google could afford to buy a majority stake in Ireland and Microsoft could buy more than 50% of Singapore, which is immoral.

“While many economies seem to be finally rebounding since the 2008 crisis, we shouldn’t be complacent,” Bris said. “Too often we do not learn from history and do not act when faced with a crisis we know is imminent.”

The Hong Kong market ranked third with RMB 65.2 billion in funds raised.

Edmond Chan, PwC Hong Kong Capital Market Services Group Partner says, “The fundamentals

for Hong Kong’s capital market remains good, and many companies are still interested and are in fact, preparing for a Hong Kong listing, with the majority of the listing candidates being SMEs. Hong Kong’s

IPO activity for the first half of 2014 reached a ten year high in terms of the number of newly listed companies. In addition, IPO activity in the second half of the year, especially in the fourth quarter, is traditionally more active than in the first half.

Given the stable growth of China’s economy, we expect to see more IPO activity, especially mega-sized IPOs, in the second half of the year meaning Hong Kong remains in

the top three global destinations for fundraising.”

INDIA’S CONFIDENCE IN NEW GOVERNMENT COULD ACCELERATE ECONOMIC GROWTH

India’s growth of 4.7% achieved in FY14, could potentially increase by approximately

1.5%

points in FY15 leading to a growth of 6.2%, by stimulating demand that addresses existing idle capacity,

according to

EY, the leading global professional services firm. EY further highlights that a combination of structural corrections,

confidence

in new Government and favourable global conditions could propel economic growth to go beyond 8% in three years. EY suggested that stimulating non- inflationary growth should be the over-riding focus for kickstarting growth.

Among the many steps essential to accelerating growth, the EY analysis also pointed to a stronger focus on driving small savings; restructuring of government expenditure; tangible steps to co-opt states for a developmental push;

prioritizing

expenditure on education and health; delivering tax reforms (GST, and direct

taxes); and a concentrated effort to deliver significant progress in sectors spanning across infrastructure (roads and power), real estate, telecom and IT, banking and financial services; and foreign direct investment. Satya Poddar, Partner - Tax & Regulatory (Policy Advisory), EY says, “A key aspect that has caused concern amongst taxpayers and specifically the international community has been the retrospective amendment and the manner in which this issue was handled. In several international jurisdictions, their Constitutions prohibit such provisions, implying such amendments to be considered only in the most exceptional

situations.”

He further adds, “The adoption of GST is expected to positively impact the business environment with better management of multiple indirect taxes that are currently applicable in the indirect tax regime, remove any cascading effect of taxes and widen the tax base.”

FINANCEMONTHLY 11

According to Dr. DK Srivastava, Chief Policy Advisor, EY, “While the investment cycle downturn has been discussed earlier, what is also important to consider

is the fact

that investment has been sitting idle in different sectors of our economy. In addition to encouraging investments, it is critical to stimulate demand, where we recommend the government to increase its

capital expenditure, which will drive infrastructure investments and result in the use of idle manufacturing capacity.

We also

recommend considerable capital investment spending to come from the states. Incentives should be given to revive small savings, so that household financial savings can be revived, which will create space for an eventual reduction in the interest rate.”