Home' A Plus Magazine : March 2013 Contents 12 March 2013
High activity in ETF reflects
untapped interest in stocks
An exchange-traded fund tracking Main-
land equities became the most traded secu-
rity on the Hong Kong exchange in January,
the Financial Times reported last month.
The iShares A50 ETF, which mirrors the
performance of China’s top 50 listed com-
panies, recorded a higher turnover value in
January than any listed stock in Hong Kong,
the paper reported.
Lunar New Year prompts
450 billion yuan injection
The People’s Bank of China pumped a re-
cord 450 billion yuan into money markets
on a single day in an attempt to satisfy a huge
demand for cash before the Lunar New Year
holiday last month. The liquidity injection on
5 February was only short term in nature, but
analysts told the Financial Times that the cen-
tral bank had honed its use of open market
operations in recent months to ensure more
stable funding for banks, investors and com-
Deloitte sued over audits
of ChinaCast Education
Several investment funds have sued the
affiliates of Deloitte Touche Tohmatsu in
China and the United States over losses at
ChinaCast Education Corporation, Reuters
reported. The funds seek to recover tens of
millions of U.S . dollars from Deloitte, which
audited the company’s financial statements.
ChinaCast took out loans and pledged its as-
sets to third parties without telling investors,
the complaint alleges.
Auditors step up scrutiny
to combat extravagance
The top auditing body announced plans
to beef up audits of fiscal funds as part
of government efforts to reduce extrava-
gance. The National Audit Office said it has
ordered local authorities to prioritize the
auditing of funds appropriated for govern-
ment departments at all levels for meet-
ings, receptions, international travel and
A fugitive accountant wanted in connection with an alleged multimillion-dollar
fraud has been freed from custody.
The Constitutional Court of Spain ordered the release of Gabriel Ricardo
Dias-Azedo, the former Hong Kong managing partner of Grant Thornton, after a
two-year battle to have him extradited.
The court ruled that Hong Kong had no power to ask for his return because
it was not a sovereign state and did not have a reciprocal extradition treaty
The Macau-born Dias-Azedo, a Hong Kong resident, left the city in September
2009 after allegedly misappropriating more than HK$90 million from Grant
Thornton clients. He was detained in Salamanca in October 2010, after a request
by Hong Kong officials.
Hong Kong officials had been trying to secure the return of the 66-year-
old Dias-Azedo under the United Nations Convention Against Corruption, a
multilateral agreement adopted by 140 signatories, including China and Spain.
The Spanish government had earlier approved an extradition request from
Hong Kong, as a part of China. However, Dias-Azedo’s defence appealed and
disputed Hong Kong’s rights under the convention. On 15 February, the country ’s
top court agreed and ordered his release.
Spain denies extradition bid for
fugitive Hong Kong accountant
Disparate GDP figures renew
doubt over official statistics
Unexplained gap is size of Guangdong economy
A 5.8 trillion yuan difference between China’s official gross domestic product
and adding up those of its 31 provinces and administrative regions has once again
called into question statistical accuracy.
The Beijing News reported last month that China’s nominal GDP hit 51.9 trillion
yuan last year, equivalent to 7.8 percent annual growth for the year. Latest eco-
nomic output figures for the sum of all its provinces, however, came in at a much
higher 57.69 trillion yuan, the paper reported.
The GDP gap – equivalent to the size of Guangdong’s economy – is not a new
phenomenon. Discrepancies between national and provincial figures have ap-
peared since the country began calculating them separately in 1985.
Liu Yuanchun, vice president of the economics department at Renmin Univer-
sity, told the Beijing News that such difference was “difficult to avoid” because of
double-counting and a lack of accuracy and transparency in the country’s statisti-
Zhu Baoliang, an economist at the National Development and Reform Commis-
sion’s State Information Centre, told China Daily that the central government will
be “determined to make sure all future data are correct.”
However, Zhu expected the gaps to become much larger before any corrective
action would be taken.
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