25 years of evolving Asian capital markets - Part 4

We look at the key events that shaped the region from 2011 to 2015.

2011
JAPANESE EARTHQUAKE & TSUNAMI

The largest earthquake to hit Japan since records began strikes on March 11, devastating the eastern coastline, killing 20,000 people and triggering the Fukushima nuclear plant disaster. Days later, the Nikkei 225 Index suffers its third largest stock crash since WWII, with insurance stocks hit hardest as insurance claim totals eventually reach the largest ever recorded for a single event. Reconstruction costs are estimated at $300 billion or more. Related infrastructure projects are still ongoing today.

2012
ABENOMICS BEGIN

Prime minister Shinzo Abe’s return to power in 2012 marks a new era of economic reform for Japan which includes multi-pronged policy shifts that become known as ‘Abenomics’. These include fiscal stimulus, monetary easing and structural reforms to encourage productivity. Years of massive government bond-buying and fiscal spending lifts stock prices, helps exporters and improves business sentiment but ultimately fails to lift inflation as hoped.

2013
CHINA’S BELT & ROAD INITIATIVE

President Xi Jinping launches the Belt and Road Initiative, one of the most ambitious global infrastructure projects ever imagined. Spanning Eurasia with new land and sea corridors to encourage trade, investment in development projects runs up to hundreds of billions of dollars, with Morgan Stanley estimating they could reach more than $1.2 trillion by 2027. Later criticised for debt-trap diplomacy, China goes on to develop a new framework to keep debt levels sustainable for participating countries.

2014
ALIBABA HOLDS LARGEST EVER IPO ON NYSE

Chinese ecommerce giant Alibaba chooses the New York Stock Exchange for its September 2014 public market debut, bringing in $25 billion in the world’s largest IPO. The frenzied offer gives Alibaba a valuation of $230 billion, more than Facebook or Amazon, and is a boon for early investors like Japan’s SoftBank Capital and Yahoo. Five years later, Alibaba pursues a secondary listing in Hong Kong raising another $11 billion.

2015
1MDB SCANDAL EMERGES

Reports emerge accusing Malaysian Prime Minister Najib Razak of siphoning nearly $700 million from a government-run development firm, 1Malaysia Development Berhad (1MDB). Further investigations reveal loose governance, questionable decisions and lavish spending by Malaysian financier Low Take Jho, who ran 1MDB as it racked up more than $11 billion in debt. The scandal is a key factor in Najib’s 2018 election loss and both US and Malaysian probes later find billions of dollars stolen from 1MDB, facilitated by Wall Street, resulting in multiple charges against Najib and Low. Investigations and litigation continue to this day.

Click below to read what happened in other years:
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