Apollo Investment Management
What was new - 2016 archive

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29 Dec 16:
Matt Mushalik highlights Exxon's involvement in Vietnam's Blue Whale gas field (Ca Voi Xanh), with his usual excellent charts. The plan to meet the supply gap does indeed include LNG import terminals, already apparently under construction although forecasts vary on dates and volumes. LNG import demand from Southeast Asian countries is expected to rise 7-11 fold over the next 15 years, from small to collectively significant, and along with the growth in India this is likely to offset demand weakness in North Asia. A recent Nikkei article cites a useful report published in April by the Oxford Institute for Energy Studies: 'Asian LNG Demand'.

27 Dec 16:
To put the political shifts of 2016 into long-term context, Visual Capitalist presents three splendid animated maps showing the history of urbanisation and the rise and fall of power centres.

2 Dec 16:
The Apollo Asia Fund NAV fell 3.3% in November to US$1,821.68; charts.

25 Nov 16:
Myanmar plans to build five major hydroelectric dams on its stretch of the Salween river, with most of the power destined for China and Thailand. This involves major risks, to the environment, society, and net welfare. Mongabay has started a 5-part series to examine the issues: 'Damming the Salween'. This follows its excellent 4-part series on threats to the Mekong delta.

18 Nov 16:
Ten days after India's shock announcement invalidating 86% of the currency in circulation, and the extraordinary rush to applaud it by various captains of industry, the reality on the ground still seems chaotic. I have only been reading from afar. There is much commentary based on fashionable theory, so I found it useful to read this article by Jayant Bhandari with personal observations from street level. A Zero Hedge article makes good points on the economic impact, and on trust. When I lived in India in the mid-90s, it was a strikingly low-trust society, and it was interesting to note the magnitude of the resultant frictional costs; it would be a shame if subsequent progress is eroded. There seems to be no provision for exchange of rupees legally held overseas, so I hope that the charities which are currently among the victims of the cash squeeze are lobbying hard, and will eventually be permitted to accept the old notes.

Further to our 3Q report, Disappearing Hills in other parts of the Malay Peninsula have been accompanied by Disappearing Species.

11 Nov 16:
It took seven years but the UK's Financial Reporting Council has completed its investigation following the collapse of Aero Inventory, giving the auditor Deloitte a record fine for misconduct.

7 Nov 16:
The Apollo Asia Fund NAV fell 0.7% in October to US$1,883.06; charts.

27 Oct 16:
I cannot recommend too highly the new book by Jonathan Rigg, 'Challenging Southeast Asian Development: The shadows of success' - very stimulating reading for all investors in the region, as well as for everyone thinking about the balance between growth and development, and about the ingredients of good policy-making. If asked previously for the best publication on the subject, I would have recommended Professor Rigg's previous book, 'Unplanned Development: Tracking Change in South East Asia' - so I am delighted to see that he is now director of the Asia Research Institute in Singapore.

For more cheering news, read Elizabeth Pisani on Health insurance Etc.: Indonesia's improbable success.

Due to travel, we plan to finalise the end-Oct NAV in the week beginning 7 Nov.

25 Oct 16:
The 3Q report is here: Muzzled tigers.

I have previously been startled by the quality of global statistics on crude oil, subject to drastic revisions which may cast a completely different light on the situation of whole countries. These commodities are after all rather important, and should be easy for governments to count, and most major producers are theoretically committed to data reliability as members of JODI. The anomalies in US oil inventories (or production, or imports) reported by Art Berman are however truly extraordinary. Meanwhile, Euan Mearns offers a valuable overview of the contrasting energy situation in the US and Europe.

4 Oct 16:
The Apollo Asia Fund NAV fell 0.2% in September to US$1,895.43; charts.

9 Sept 16:
A helpful overview from Roger Andrews examines the statistics on low-carbon energy sources, and the policy choices of different countries: 'Electricity and energy in the G20'.

2 Sept 16:
The Apollo Asia Fund NAV fell 2.6% in August to US$1,899.59; charts. Part of the decline was due to a single block purchase in Vietnam: we paid a significant premium to the price paid in the local market, and immediately marked it down to that level, reducing the fund's NAV by 1.0% on a single transaction. We have made similar smaller purchases in recent months, depressing performance slightly in the short run, but establishing investments in which we have great hopes for the future.

Gail Tverberg discusses the practical constraints on solar & wind power: 'Intermittent renewables can't favorably transform grid electricity'.

30 Aug 16:
On Asia Sentinel, Frank Ching says that 'Claiming dominance, China sheds pretense of peaceful rise'; Philip Bowring notes that 'The naming of seas is a practical matter'; and an anonymous correspondent provides an update on Thailand's military courts.

10 Aug 16:
'Australiaís offshore camps... rest precariously on four pillars: corporate complicity in abuse; legal and regulatory frameworks that allow innocent people to be warehoused indefinitely; the publicís willingness to accept deliberate cruelty to innocent people; and bipartisan political support. After years of uncertainty, hopelessness and abuse in the camps, only the final pillar holds strong and even the collusion of [Australia's] major parties can't avert the looming chaos.' Shareholders of Ferrovial and UK enthusiasts for Australia's approach to migration should take note: 'Offshore detention was destined to fail and the collapse might be closer than you think'; 'A short history of Nauru, Australiaís dumping ground for refugees'.

5 Aug 16:
A useful account of the changing psychology of bond investors in Singapore, the formerly 'unburnt class': 'Behind every default was once a darling - Swiber'.

3 Aug 16:
The Apollo Asia Fund NAV rose 3.8% in July to US$1,950.87; charts.

31 Jul 16:
The 2Q report was belatedly posted: Hoping for alpha.

5 Jul 16:
The Apollo Asia Fund NAV rose 0.9% in June to US$1,880.12; charts will be updated next month.

21 Jun 16:
Amidst the confusion of politics and emotion, George Soros issues a clear and succinct warning on the immediate dangers of Brexit to sterling and living standards, and explains why the resultant fall in sterling may be much more damaging for Britain this time around. Asian companies which envisaged their manufacturing and service industry investments in Britain as suitable centres for Europe are aghast at the new uncertainties. After being overseas for some years I was disenfranchised by the Blair government, but hope for a large turnout, and the opportunity for Britain to regain a reputation for stability and responsible governance within a peaceful EU.

Asia's growing dependence on imported oil is shown in excellent charts by Matt Mushalik on crudoilpeak.info, based on the latest BP Statistical Review (amended yesterday: excel). Voters and other decision makers worldwide should be paying more attention to energy issues, and to analysts who seek to shed light on reality.

The official secrecy about the offshore detention centres is a disgrace to Australia.

2 Jun 16:
The Apollo Asia Fund NAV fell 0.7% in May to US$1,864.20; charts.

13 May 16:
While KL suffers from alternating heatwaves and flash floods, the latter exacerbated by poor road maintenance and the casual destruction of old trees, the situation elsewhere is much more serious. IRIN reports that 'the Mekong is at its lowest level since records began nearly 100 years ago... Thatís bad news for about 60 million people living in the Lower Mekong Basin region, of whom 80 percent depend on the river for food and livelihoods'. It quotes a fishermen on the Tonle Sap, which many of our readers will have visited: 'This year is terrible. We cannot find any fish. No one is helping us, and we are almost starving.' More dams are under construction, and planned.

6 May 16:
We grumbled earlier about Kafka's costs, and now have a constructive suggestion. The whole regulatory paperwork behemoth may be too big to be tackled, but much misery could be avoided by measures that any one bank, fund administrator, regulator or IT company could initiate. We unveil a modest proposal to reduce KYC costs.

4 May 16:
The Apollo Asia Fund NAV rose 0.4% in April to US$1,876.79; charts.

The 2015 report of income for UK Reporting Fund purposes is now available here; the page listing all reports (starting 2013) is www.apolloinvestment.com/UKreportingfund.html.

25 Apr 16:
Now half way through a journey up the Mekong from sea to source, 'A River's Tail' is wonderful for the armchair traveller: many of us will have encountered the Mekong at various points, but few of us have time to travel the whole length. This fills the gaps - and packs a devastating message about the pace and scale of environmental destruction.

20 Apr 16:
The 1Q report has been posted: Kafka's costs.

1 Apr 16:
The Apollo Asia Fund NAV bounced 7.2% in March to US$1,868.91; charts.

21 Mar 16:
The Apollo Asia Fund NAV fell 1.3% in February to US$1,744.19; charts. Apologies for the delay in updating the website; the NAV was finalised in early March on the usual schedule, and it was your fund manager who failed to upload the webpages correctly. Asian markets and currencies have rallied sharply month-to-date, recovering the losses of Jan-Feb. This may be regarded as a bear market rally, but both our benchmark regional index (MSCI AC Far East ex Japan) and the Apollo Asia Fund NAV are now slightly up year-to-date.

2 Feb 16:
The Apollo Asia Fund NAV fell 3.9% in January to US$1,767.22; charts.

10 Jan 16:
The 4Q report has been posted.

5 Jan 16:
The Apollo Asia Fund NAV rose 1.0% in December to US$1,839.82; charts.

Claire Barnes

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