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Archive for 1. Dezember 2019

An Oil Giant Plans for Climate Change

Posted by hkarner - 1. Dezember 2019

Date: 30‑11‑2019

Source: The Wall Street Journal

Shell is test‑driving a number of eco‑friendly business models before deciding which one to buy into

Royal Dutch Shell knows that climate change means business change, but isn’t sure how. Like a savvy car buyer, it is testing out a few eco‑friendly models before it chooses one.

The approach is sensible for Europe’s most valuable oil and gas producer, given that we don’t know what a lower‑carbon future really looks like. At some point, though, investors need to brace for a big decision.

All countries except the U.S. have promised to cut their carbon emissions to comply with the 2015 Paris climate accord. Extreme weather events, ongoing climate protests and shifting public opinion are now pushing governments to deliver. The oil and gas business is on the front line of the drastic economic changes required.

Equally, though, there is great uncertainty about the pace of the transition and how lower‑carbon economies will eventually be structured to produce and sell power, food and transportation.

Faced with this conundrum, Shell has promised to halve its net carbon footprint by 2050 from the 2016 level. It has gradually moved away from oil toward lower‑carbon gas and has been adding electricity to its product mix. It is also applying its trading and retailing expertise to products other than oil and gas. With 45,000 stores—more than Starbucks or McDonalds—Shell serves 30 million customers daily. Den Rest des Beitrags lesen »

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One company, two systems

Posted by hkarner - 1. Dezember 2019

Date: 28‑11‑2019

Source: The Economist: Schumpeter

Alibaba sets its sights on Amazon

Anyone who is cursed with a rational mind should ponder Alibaba’s faith in eight, the luckiest single digit in China. On November 26th China’s e‑commerce juggernaut sold HK$88bn ($11.2bn) of secondary shares on the Hong Kong Stock Exchange under the stock symbol 9988—88 is not only a homonym for baba, but also signifies double luck. As soon as the gong was banged to launch trading, the shares soared from HK$176 to the auspicious price of HK$188. Luck was on Alibaba’s side. Nearby Pedder Street, where 19th‑century stockbrokers gathered to trade shares, has been a hotspot of anti‑China protests since early summer. On occasion, the smell of tear‑gas has wafted into the exchange. Yet after a landslide win for pro‑democracy parties in local elections earlier in the week, the chaos has—at least temporarily—subsided.

Luck aside, the listing provides the company with triple benefits. It wins brownie points with the Chinese government for demonstrating confidence in Hong Kong’s financial future amid the protests. It partially hedges its exposure to America, where it launched the biggest initial public offering of all time in 2014, but has recently suffered from trade‑war related turbulence. And it increases the accessibility of its shares to Asian institutional investors, who may be less inclined to view China through the prism of trade and geopolitical tensions. Soon it may be eligible for Stock Connect schemes that link Hong Kong with markets in Shanghai and Shenzhen, allowing mainland investors to pile in as well. Den Rest des Beitrags lesen »

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