Australian politicians called for an inquiry into the country’s foreign investment laws as state-owned Aluminium Corporation of China is pursuing a $19.5 billion purchase of Rio Tinto’s mining assets in Australia. The Chinalco-Rio Tinto deal has caused significant suspicion among Australian officials that there are higher political motives at play behind Chinalco’s investment plans.
Chinese and other Asian stock markets are set for an “explosive” rally in mid-2009, according to Fortis Investment Management SA. They justified their confidence in Asian stock markets by pointing to strong potential for domestic demand growth.
Chinese banks are expected to report sluggish growth for the final quarter of 2008 as the global downturn takes it toll. Profit margins for 2009 are set to tighten as interest rates decline. Meanwhile, the country’s insurers are expected to report sharp drops in 2008 profits.
Brazil, Russia, India and China called for a stronger representation of emerging economies in the International Monetary Fund and the World Bank. Chinese finance officials urged the international community to accelerate the reform of international financial institutions and cooperate in the construction of a new global financial system.