My Daily Commitment

[al97]

Hi I will be creating a thread here to post daily updates to keep myself accountable. With this, I hope to motivate fellow applicants as daily commitments takes a lot of resilience. Plus, you may be able to benefit on the information I post here as I intend to focus on two aspects on this thread:

1. Technical knowledge
e.g. what is indemnities/warranties/practice areas etc

2. Commercial Awareness
My focus is on energy and technology sectors (for now)

My post may not be necessarily perfect or correct, which is the purpose of creating this thread so more senior members can jump in to comment too

 

[al97]

12 Sep - Commercial Awareness - Tech sector
FT link: https://www.ft.com/content/770e58b1-a299-4b7b-a129-bded8649a43b
Topic: Tension between tech regulators and Big Tech in the context of Data Privacy

WhatsApp threatened to pull out from the UK because the proposal of protecting users actually threatened to infringe on users’ privacy.

Regulators want access to BigTech’s data. Taking WhatsApp as an example, Ofcom regulators want to scan users’ messages to detect harmful content such as child sexual abuse content.

However, there’s no technology that would enable regulators to achieve this. The existing technology has wrongly identified safe content as harmful, flagging this to human monitors, thereby increasing the costs of maintaining data privacy. Second, current technology used to scan end-end encrypted messages will undermine users’ privacy at the same time. Third, child abuse campaigners want Big Tech to be responsible for the abusive materials shared on their platform, but it is questionable whether the Online Safety Bill – in its final stage of Parliament – will be able to hold Big Tech accountable.

Interview questions:

1. What does Ofcom stand for? What does it do?

Ofcom stands for the Office of Communications. Ofcom is the regulator and competition authority for the UK TMT industries. It regulates the TV and radio sectors, fixed line telecoms, mobiles, etc

1. What are the regulatory challenges that Big Tech currently face?

Refer to the news above.

1. What is an end-end encrypted message?

Security technology that only allows the sender and recipient of messages to view them.

That’s my sharing today, thank you for reading! Please feel free to add extra information, correct me if you’re an expert in tech. I wish to reiterate that I consider myself a newbie in commercial awareness so make sure you do not rely on my thread as a reliable source.

 

[Jaysen]

Looking forward to the daily updates!

 

[al97]

13 Sep - Commercial Awareness - Energy sector
FT link: https://www.ft.com/content/e4f1ef39-42aa-428e-a358-a0f1431213e2
Topic: BP’s CEO resigned

BP’s CEO, Looney, suddenly resigned following his failure to disclose a personal relationship with a colleague, which caused the company’s share price to fall when the news was announced. His contribution to Net Zero is significant, in that BP’s investments in renewables are further than US ExxonMobil and Chevron and UK Shell. There hasn’t been confirmation on a candidate, but the CFO stepped in as an interim. Hence, investors questioned whether the next candidate would take the same approach to renewables as Looney did.

Brief Background about BP
Market Capitalisation of $111 billion (as of Sep 2023)
Oil prices moving above $90 a barrel (as of Sep 2023)
The rise in oil prices is caused by the Russian invasion of Ukraine which reduces the supply.
BP wrote off 20% stake in Rosneft, the Russian state-backed oil company, but they technically still owned it. The sale is complicated by the need to seek approval from the Kremlin, so the dividends were put away in an escrow account.

Interview Question:

Who are the biggest players in the energy sector?

London-based BP, US ExxonMobil and Chevron, and UK-based Shell.

What is an escrow account?

A third-party account that held funds on behalf of two parties for a certain period, pending for a certain outcome to be achieved/fulfilled.
In the context of M&A, when there’s a potential dispute with the Target company, the Buyer may request for an indemnity clause to be inserted so they can be indemnified for the costs flowing from the litigation. But since the amount can be unlimited, the Seller can impose a limit by setting an escrow account where they deposit a certain amount of funds, at the Buyer’s disposal shall litigation arise.

What is dividends?

Profit on shares paid to shareholders. In this context, BP has 20% stake in Rosneft, which means it own 20% of Rosneft, therefore a shareholder who receives the profits when the company is performing well. As they’re in the middle of completing a transaction, any dividends earned are deposited into the escrow account.

Who is the Kremlin?

The Kremlin is the residence of Putin, the equivalent of what the White House is to Biden.

 

[al97]

14 Sep - Commercial Awareness - Tech
FT: https://www.ft.com/content/651d4970-ef7b-46a0-a68f-c7b4b0ca888f
Topic: The biggest IPO in two years - Arm’s First Day on the NASDAQ exceeded expected share price by 25%

Arm’s first day on the NASDAQ closed at $65 billion, which raised $5 billion for SoftBank and became the largest US listing in two years.

Arm’s background
Arm is a chip-designing company
Arm was owned by SoftBank, one of the biggest venture capital funds that famously funded Alibaba, FTX, and WeWork.
It was purchased by Softbank back in 2016 at $32 billion.
An interesting side note: in 2020, NVIDIA negotiated with Softbank about acquiring Arm, but the sale eventually collapsed in 2022 due to competition issues.
https://www.theguardian.com/business/2022/feb/08/nvidia-takeover-arm-collapses-softbank

The IPO
Prior to the sale, Softbank bought 25% of shares that it originally did not own from Vision Fund.
The shares were valued at $26 billion and sold for $16 billion.
Apple, Google, Intel, NVIDIA, Samsung and more, owned about $735 million of shares together
Companies that invest in Arm see a rise in shares: TSMC shares increased by 1.5%
Barclays, Goldman Sachs, JPM and 25 other banks are involved in the sale

Insights
The staggering number signifies and boosts confidence in the tech sector, venture capital, and IPO market. The VC fund hasn’t been performing well in recent years due to the collapse of FTX following the founder’s indictment of fraud in 2022 and the overexpansion of WeWork. Hence, Arm’s IPO served as a boost to the VC space.
There are two notable IPOs coming up: Instacart, a grocery delivery app and Klaviyo, a marketing software group.

Further research
The IPO is a wide topic because Arm is essentially semiconductors (the hardware) and intellectual property (the software). There are intense geopolitical tensions between US-China swirling around the semiconductor industry, so it is an extremely deep topic that I’ll be exploring further.

 

[al97]

15 Sep - Commercial Awareness - Tech
FT: https://www.ft.com/content/e605a92c-5efc-471c-bd7d-a36c7620420c https://www.ft.com/content/792fae47-8e2f-4363-99e9-176b33ccc09a
https://www.ft.com/content/c72f4ebd-3b98-4677-b688-6631a6b1cb5a
https://www.ft.com/content/257b39c4-f146-41ae-af75-dfea955ff462
Topic: Arm’s IPO from China’s angle

Arm UK owns 47% stake in Arm China
China wants to keep Arm China
China refused to process the paperwork confirming Arm China’s transfer to a new Vision Fund called Acetone, which invested in AC. There are also reports that Arm China delayed its payment to Arm UK.
Softbank wants Arm to be separated from AC because the latter is troublesome, one issue is with the CEO Allen Wu, who owns the third largest shares.
Allen Wu was in a corporate battle with Arm UK for resisting to surrender control
The chip war between the US and China escalates and Arm China plays an important role for the country’s chip industry
Since the US export restrictions were intensified, Beijing urged Arm to work closely with them. For example, deepen its cooperation with Chinese universities, research institutes, and companies.
Regardless, UK remained as US ally and did not grant approval to Arm’s licence which were required for selling its most advanced chip to China, one customer is Alibaba.

Interview question:

1. What is going on in the tech industry

Arm’s IPO; US-China battle over semiconductors intensified; China relies on Arm China

1. What are the challenges for China now?

Export control. China is behind in terms of its semiconductor industry, which explains its dependence on foreign import technology, such as Arm UK which has a Chinese arm in the country. US suppresses their growth by intensifying their export control, including raw materials required to manufacture the chips. The states also lobby their allies such as the Netherlands and Japan, to inhibit China’s growth.

1. How does this relate to law firm?

UK and China's deteriorating relationship may hinder cross-border activities in the tech sector. Therefore, law firms with an office in China (NRF, AO) may not necessarily have active tech corporate transactions, but will probably see an increase in the commercial dept like IP rights or contentious dept like IP disputes.
US firms or UK firms with a focus on technology, venture capital, and US footprints may have an advantage. Orrick, Cooley, Wilson Sonsini, Covington, and Goodwin are five US firms that I can think of with an exceptional reputation in technology. With venture capital, Orrick has a consistent top 1 ranking on Pitchbook. UK firms with a distinguished tech practice is AO and Birds, the former has an office in Silicon Valley.

 

[al97]

16 Sep - Commercial Awareness - Tech
Topic: Why did Arm choose to list in the US and not UK?
FT: https://www.ft.com/content/5b129a9e-aa94-4d23-ad49-b0c934ce0dcb
https://www.ft.com/content/7bb96cc9-eabe-43d8-a552-2107354c3ea0

Arm is based in Cambridge and it was listed on the London Stock Exchange (LSE) until Softbank bought it in 2016 and de-listed it.
Now that Arm has returned to the public market via an IPO, why did the LSE lose its charm over the NASDAQ?

Based on the articles I read today, there are three reasons:

1. The lack of government investment

Other jurisdictions have offered aggressive financial incentives to attract tech companies, which is logical as the rising political tensions pressurise countries to be more self-reliant on critical technologies. Also, where a factory is built, job opportunities follow, thereby boosting the economy in the region.

For example, the US offers $52 billion for companies to build fabs (chip manufacturers). Especially in the mid-states like Arizona, where TSMC (top 1 mega chip manufacturer, Arm relies on it) is currently building a fab.

EU promises EUR43 billion of state aid for the sector. Germany offers billions of subsidies to Intel to build a chip facility.

On the other hand, UK plans to offers £1 billion over the next decade to the chip industry.

1. Brexit

UK’s financial market underperformed since Brexit with the loss of passportiing rights (passporting system for banks and financial services to trade freely with minimum authorisation). Paris overtook London’s top spot as EU’s most valuable stock market since 2003. In addition, London capital market records multiple failures: Deliveroo, THG, Made.com

1. Dual-listing

Dual-listing is not favourable because companies can access cross-atlantic investors on the domestic exchange, so foreign listing is an unnecessary cost.
Note: dual-listing is expensive because co. needs lawyers, bankers, auditors on both sides, coordinating different IPO workstreams, therefore more complicated and time-consuming. For example, if Arm were to dual-list, the UKLA and SEC have very different rules and protocols.

 

[al97]

17 Sep - Commercial Awareness - Private Equity
Topic: Goldman assists China in making UK/US investments
Link: https://www.ft.com/content/792fae47...egmentId=22011ee7-896a-8c4c-22a0-7603348b7f22


Goldman set up a partnership fund – with money from a Chinese state-backed fund – and invested in UK and US companies in critical sectors.

Sovereign wealth funds face difficulty in investing in critical sectors (eg tech, energy). PE funds like Goldman can help. They build up indirect holdings in companies.

Goldman set up a CIC fund - China-US Industrial Cooperation Fund - aimed to address US’s concerns about China’s investment in the US. CIC was founded in 2007 with $1.3 trillion assets at the end of 2021, half of which are invested in private equity. This is an example of bilateral fund.

Goldman made 4 investments in 2021 and one in 2022, acquired LQRA - an inspection company, and a cyber security group, and invested in Cprime - cloud computing, Paraxel, a drug testing company and many more examples. The investments will help these Western companies to scale in China.

One example of how companies circumvent political pressure. China is able to invest in US and vice versa.

 

[al97]

18 Sep - Commercial Awareness - Law firm as a business
Topic: Paul Weiss’s second raid of Kirkland partners
Link: https://www.ft.com/content/09a8a911-e406-441f-85af-25d1539cdc1b
https://www.ft.com/content/5e430125-c107-4cc6-866b-478f7d84b7aa
https://www.ft.com/content/44ae74d1-53c5-4674-b7db-433e1d0a0279

Last week, US firm Paul Weiss raided 12 new partners from KE who specialised in private equity and one partner from Linklaters in M&A.

1. PW’s ferocious expansion

This is the second time they raided KE partners. The first time was reported on 14th Aug and the raid included approx 4 partners from the London office as well as a team in LA, all of which are directed at Kirkland, mainly from the private equity team

The raid aligns with PW’s plan to expand in London and set up an office in LA. FT wrote that this is a short-term strategy to attract partners but very expensive in the long run.

In my opinion, Kirkland relied on this strategy to expand to the top in terms of revenue, so PW is simply replicating. Now that we have entered a high-interest rate era, it is doubtful whether it is a risky move for PW to spend this much money to poach expensive partners. Alternatively, the news can be a strong argument that the PE team will be busy again

1. US executives bypassed London partners to hire new partners from a rival
   1. How is the relationship between US HQ executives and MPs from other offices?
   2. Can they “plant” new partners without consulting them first?

1. Impact on the London legal market.

This is apparent in the staggering rise of NQ’s pay. Though in my opinion, the need to escalate in line with inflation plays a role, but a lucrative salary at US firms are major contributor to UK firm's pay rise.

Especially at NQ level, where the gap is stark between Magic Circle (105k in 2022) and US firms (150k in 2022). In 2023, four MC firms (except for Slaughters at 115k) increased to NQ pay to 125k, which is a steep increase from last year, but it’s still substantially lower than the average of US.

Seeing that US firms are increasingly dominant in the City, how will London compete to attract the best talent?

 

[axelbeugre]

18 Sep - Commercial Awareness - Law firm as a business
Topic: Paul Weiss’s second raid of Kirkland partners
Link: https://www.ft.com/content/09a8a911-e406-441f-85af-25d1539cdc1b
https://www.ft.com/content/5e430125-c107-4cc6-866b-478f7d84b7aa
https://www.ft.com/content/44ae74d1-53c5-4674-b7db-433e1d0a0279

Last week, US firm Paul Weiss raided 12 new partners from KE who specialised in private equity and one partner from Linklaters in M&A.

1. PW’s ferocious expansion

This is the second time they raided KE partners. The first time was reported on 14th Aug and the raid included approx 4 partners from the London office as well as a team in LA, all of which are directed at Kirkland, mainly from the private equity team

The raid aligns with PW’s plan to expand in London and set up an office in LA. FT wrote that this is a short-term strategy to attract partners but very expensive in the long run.

In my opinion, Kirkland relied on this strategy to expand to the top in terms of revenue, so PW is simply replicating. Now that we have entered a high-interest rate era, it is doubtful whether it is a risky move for PW to spend this much money to poach expensive partners. Alternatively, the news can be a strong argument that the PE team will be busy again

1. US executives bypassed London partners to hire new partners from a rival
   1. How is the relationship between US HQ executives and MPs from other offices?
   2. Can they “plant” new partners without consulting them first?

1. Impact on the London legal market.

This is apparent in the staggering rise of NQ’s pay. Though in my opinion, the need to escalate in line with inflation plays a role, but a lucrative salary at US firms are major contributor to UK firm's pay rise.

Especially at NQ level, where the gap is stark between Magic Circle (105k in 2022) and US firms (150k in 2022). In 2023, four MC firms (except for Slaughters at 115k) increased to NQ pay to 125k, which is a steep increase from last year, but it’s still substantially lower than the average of US.

Seeing that US firms are increasingly dominant in the City, how will London compete to attract the best talent?

Such an interesting trend we are witnessing from PW, thank you so much @al97 for shedding light on this huge expansion and its impact!

 

[al97]

20 Sep - Commercial Awareness - Energy sector
Topic: EU’s dependence on China in the energy sector
Link: https://ig.ft.com/rare-earths/

China’s dominance of the raw materials industry is harsh. Last year, China dominated 70% of rare earth mining production, a staggering jump from 58% in 2021. The raw materials are used to produce permanent magnets, which is a key component in wind turbines and electric cars, produce that are critical to green energy, hence the energy sector. (Side note: in military, it is used to put together a fighter jet).

EU intends to reduce its dependence, especially in the wake of the Ukraine conflict, but it is difficult.

Current legislation: EU proposed the Critical Raw Materials Act (CRMA) to strengthen raw materials supplies.

What are the challenges in curtailing the dependence on China?

One, China is ahead with the technology of extracting raw earth materials. The technology is extremely complicated but they have been perfecting it for the past 30 years and it would be difficult to catch up within 5 years.

Two, the extraction facilities need to be built near the mining site. The only site that has raw materials in the EU is very close to the borders of Russia and EU now has a sensitive relationship with Russia.

Three, environmental concerns such as granting permits. A company struggled that get a permit for a mine in Serbia. Even if it’s a sustainable project, local communities don’t want to live next to a mine.

Four, labour costs in China is much lower than in the EU, which gives it a competitive advantage.

Five, China imposed export quotas.

Other developed countries that are rushing into the competition: Japan and US are reducing their dependence. The latter has a mining facility in California.

EU explore its relationship with new partners. Australia resisted EU’s call to cancel export price control. Malaysia ban export of raw materials to boost the domestic industry. It is believed that EU cannot achieve its climate goal without China.

 

[al97]

Such an interesting trend we are witnessing from PW, thank you so much @al97 for shedding light on this huge expansion and its impact!

Thank you Axel, it's encouraging to hear this and your words motivate me to keep up!

 

[al97]

21 Sep - Commercial Awareness - Energy sector
Link: https://www.ft.com/content/55ec498d-0959-41ef-8ab9-af06cc45f8e7
https://www.ft.com/content/1d3201e1-bfbf-4eb2-aca1-06c83d87b1e6
Topic: EU and UK’s EV sector suffers competition from China

EU

• Brussels will launch an anti-subsidy investigation in to China’s electric vehicles (EV).
• Definition: Anti-subsidy are trade import duties imposed on goods to neutralise the negative effects of state subsidies
• France demanded action against Chinese EV as they’re losing market shares to China.
• In the past, China has outperformed the EU with trade in the solar industry and wind industry.
• In 2010, photovoltaic manufacturers in EU went into insolvency. Then, Brussels launched a tariff regime against Chinese imports in 2012, but scrap it again later to boost renewable power.
• Similar challenges emerge in the wind industry.

UK

• In UK, the ban on selling petrol and diesel cars was planned to commence in 2030, but Sunak announced that the ban would be delayed to 2035.
• EV cars must reach the target of 80% of the market total produce. The delay of the ban may discourage consumers from buying EV therefore harder for the industry to reach the target.
• UK EV sales scheme require manufacturers to sell a certain portion of EV otherwise they may be fine up to £15,000/vehicle.
• Thankfully, governments are flexible with the targets. If manufacturers can’t hit the target at the earlier stage, they can make up for it at the later stage so they don’t need to pay the penalties.

 

[axelbeugre]

21 Sep - Commercial Awareness - Energy sector
Link: https://www.ft.com/content/55ec498d-0959-41ef-8ab9-af06cc45f8e7
https://www.ft.com/content/1d3201e1-bfbf-4eb2-aca1-06c83d87b1e6
Topic: EU and UK’s EV sector suffers competition from China

EU

• Brussels will launch an anti-subsidy investigation in to China’s electric vehicles (EV).
• Definition: Anti-subsidy are trade import duties imposed on goods to neutralise the negative effects of state subsidies
• France demanded action against Chinese EV as they’re losing market shares to China.
• In the past, China has outperformed the EU with trade in the solar industry and wind industry.
• In 2010, photovoltaic manufacturers in EU went into insolvency. Then, Brussels launched a tariff regime against Chinese imports in 2012, but scrap it again later to boost renewable power.
• Similar challenges emerge in the wind industry.

UK

• In UK, the ban on selling petrol and diesel cars was planned to commence in 2030, but Sunak announced that the ban would be delayed to 2035.
• EV cars must reach the target of 80% of the market total produce. The delay of the ban may discourage consumers from buying EV therefore harder for the industry to reach the target.
• UK EV sales scheme require manufacturers to sell a certain portion of EV otherwise they may be fine up to £15,000/vehicle.
• Thankfully, governments are flexible with the targets. If manufacturers can’t hit the target at the earlier stage, they can make up for it at the later stage so they don’t need to pay the penalties.

so interesting! thank you again @al97

 

[al97]

22 Sep - Technical - Private Credit
Topic: Revival of private
https://www.cioninvestments.com/wp-content/uploads/What-is-Private-Credit-1.pdf
https://www.ft.com/content/e3e7596c-075b-4a19-9e4f-e9752da54e42

Hayfin raised EUR6 billion for direct lending to EU companies, which was 6x more than the last quarter. Hayfin was founded in 2009 after GFC. It manages EUR30 bn. Recent deals are the financing of the Hyve Group by Providence.

PE firms have $3.7 trillion of dry powder (funds that have not been utilised, e.g invested into a company or buy-out).
PE firms that have a private credit arm: KKR, Apollo, Carlyle, Blackstone

Rising interest rates and greater economic uncertainty cause the boom in private credit funds but it causes great pressure to PE-backed businesses.

Basics of private credit

• Similar to how a bank gives a loan to businesses, a lender lend money to a borrower, usually SMEs, but the debt is not traded on public market like how public companies can securitise their debts into bonds and trade it. Since the loan from a private lender can be easily accessibly, that means the interest rate is also higher to offset the risks
• Private credit rose to prominence after the 2008 GFC when banks are deterred to lend to SME.
• Middle markets were active seeking non-bank funding post-GFC and they were willing to pay the higher interest rate
• They comprised of c.200k businesses and represented ⅓ of the private sector GDP, generating c. $1bn annual revenue
• They are diverse in geographies and sectors

 

[al97]

23 Sep - Commercial Awareness - Private Equity
Topic: Goldman bought stakes in private equity funds
https://www.ft.com/content/d90c4edc-0385-4601-9ae5-b7f251462aea

Goldman raised $15 billion for its largest-ever secondary fund. It is attractive to investors because their investments are typically locked in a fund for more than a decade. This is Goldman’s first fund specifically focused on investor stakes.

What is a secondary fund?
Primary fund is when a PE fund purchases a stake in a company and secondary fund is when the stake is sold to another fund investors. Sellers gain liquidity while buyers benefit from the portfolio. Blackstone and Ardian both have raised more than $20bn this year for their secondary funds.

 

[al97]

25 Sep - Commercial Awareness - Energy sector
Topic: Asset manager under investigation for greenwashing paid $19mn to settle
https://www.ft.com/content/02b19456-d3ed-4c3f-9c39-ec95d81a62ae

DWS is an asset manager mostly owned by Deutsche Bank. The allegations of greenwashing and violations of AML laws are brought by the SEC. It paid the settlement without admitting or denying the allegations.

The SEC claimed that DWS made misleading statements about the size of its ESG investment assets. SEC became tougher to violations since Gensler is the chair. He proposed new rules to broaden the disclosure on ESG risks.

DWS have also been a subject of investigation by German and Frankfurt prosecutor. Last year, the DWS was raided by police over greenwashing allegations and the CEO was removed as a result. However, he was compensated with EUR13.7mn payout, a bonus of 3.2mn and severance pay of 8.15mn.

The news is related to the litigation arising from ESG claims and director/executive’s liability. In my view, the relevant practice areas are private funds (asset managers, private equity, hedge funds) and white collar crime (in relation to director’s fiduciary duty, did the fund manager make “clean investment” in accordance to the ESG expectations?). The news could be a good example when discussing the risks and opportunities that ESG brings to law firms.

 

[axelbeugre]

25 Sep - Commercial Awareness - Energy sector
Topic: Asset manager under investigation for greenwashing paid $19mn to settle
https://www.ft.com/content/02b19456-d3ed-4c3f-9c39-ec95d81a62ae

DWS is an asset manager mostly owned by Deutsche Bank. The allegations of greenwashing and violations of AML laws are brought by the SEC. It paid the settlement without admitting or denying the allegations.

The SEC claimed that DWS made misleading statements about the size of its ESG investment assets. SEC became tougher to violations since Gensler is the chair. He proposed new rules to broaden the disclosure on ESG risks.

DWS have also been a subject of investigation by German and Frankfurt prosecutor. Last year, the DWS was raided by police over greenwashing allegations and the CEO was removed as a result. However, he was compensated with EUR13.7mn payout, a bonus of 3.2mn and severance pay of 8.15mn.

The news is related to the litigation arising from ESG claims and director/executive’s liability. In my view, the relevant practice areas are private funds (asset managers, private equity, hedge funds) and white collar crime (in relation to director’s fiduciary duty, did the fund manager make “clean investment” in accordance to the ESG expectations?). The news could be a good example when discussing the risks and opportunities that ESG brings to law firms.

very interesting topic!! @al97

 

[al97]

30 Sep - Commercial Awareness - US-China tension
https://www.ft.com/content/b66e2f92-1b92-47af-8f4b-f2a1abcedfbd
https://www.ft.com/content/0c20823d-2d5f-435e-aec4-269dbe5dafb4

I've been away for the past few days as I've travelled back home to the other side of the globe. The 16-hour journey was pleasant but the one-way Qatar ticket was a great indication of inflation, bought it at £580 and they used an old aircraft. A year ago, it would probably be at £300-400. I travelled back home because I still have no luck securing a paralegal position after 3 months of contacting recruiters, drafting cover letter like I would for a TC, and receiving rejections. It does not mean I've given up, just a cheaper option to keep applying without paying London rent. Anyways, enjoy the read today!

Singapore’s relationship with the US and China

It has benefitted from both superpowers

• Last year, SG and China launched a new bilateral defence hotline
• SG and China restarted military drills after the pandemic pause
• In March, SG deployed a US-made military aircraft on a short-term basis
• SG also announced that it might opt to acquire 8 more of the aforementioned aircraft
• SG sourced its arms equipment mostly from US

AML investigation of Chinese money and “Singapore-washing” in SG

• SG washing refers to the act of rebranding Chinese companies as SG-based international companies
• Sequioa China, now Hong Shan, opened a SG office this year
• The foreign capital is recorded as SGD448 bn in 2021
• The AML allegation targets 8 individuals and SGD1.8 bn, one similarity among them is their ownership of a China passport. The investigation was the largest-ever in SG and prompted scrutiny from the central bank

Why is SG a popular destination?

• Cheap labour and property costs (like India and Indonesia) to build high-tech factory
• Globally connected
• Stable political landscape
• Strong eonomy - even as global recession hits, inflation is at 3.8% and unemployment is 1.9%, in contrast with London’s 5.1%
• Hong Kong lost its crown as an international hub

 

[al97]

1 Oct - Commercial Awareness - Energy sector
Topic: Oil prices records high
https://www.ft.com/content/c2482121...egmentId=7d4bcc2e-e664-92ba-62e3-5590579f1902

Oil prices surged to record-breaking highs at $93 due to Saudi Arabia and Russia’s decision to reduce supply. It is speculated to rise to $100100.

Saudi Arabia and the Western powers clash because the former prince prioritises its own interest to boost domestic economic and social programs over their allies. It affects the central bank’s ability to control inflation. SA and Russia have led Opec+ to reduce supplies.

In the US, Biden administration accused SA for aligning with Russia. Trump attempts to use the rise in oil prices and the handling of SA situation to attack Biden during the next presidential election.

Hedge Funds are betting on the oil market to pass $100 per barrel. Their attention in the oil market was sparked by SA’s announcement to keep the production curbs in place longer. Doug King does not believe the price will go higher as he believes that the market was driven by the Opec+ restraint rather than a strong demand.