Guangdong credit surges: Guangdong companies have been on a borrowing binge in the wake of the epidemic: according to official data, loans outstanding at the end of April were up by 1.3 trillion yuan, which represents a 43% YoY jump in new lending. Moreover, corporate insurance policies are booming, too: in April alone, 8.6 trillion yuan of risk-protection policies were written for corporates in the province, up 19.8% YoY. SCN.
New order: The GBA must accelerate its integration plans as the changing world order will make it more necessary for the region to open up, in order to attract capital and talent. This is the view of Zheng Yongnian, a professor at the East Asian Institute of the National University of Singapore. SCN.
Continue reading GBA Briefs: 6/10/2020
It was encouraging to see how Hong Kong managed last night to peacefully commemorate the bloody crackdown on anti-government protesters around Beijing’s Tiananmen Square, 31 years after it happened. That so many people felt the courage and had the determination to defy a government ban on the annual vigil says much about Hong Kong’s crucial role in keeping memories of the event alive.
How future commemorations will be held, once the National Security Law is passed and added as an annex to the Basic Law, remains to be seen. Could a spontaneous gathering of people waving their smartphones in the air be considered a threat to national security? It will surely depend on how secure the authorities are feeling on July 4, 2021. Last night, the police wisely stood by. It can only be hoped that a good precedent has been set for future events, by both sides.
Continue reading Tiananmen’s legacy
Dollar threat: Will the Trump administration cut China off from the US dollar? While the probability remains very low that China will be treated like Russia or Iran, and US President Donald Trump has not mentioned sanctions against Hong Kong or Chinese financial institutions, the risk of a financial war is no longer “unthinkable” for China, analysts say. SCMP.
Justice chief reassures: The suggestion to make judges recuse themselves based on their nationality was “strange”, Hong Kong’s justice secretary said, but she urged people not to jump to a conclusion too quickly about the possibility of a special court, which could help the judiciary navigate uncharted territory. SCMP. Cheng also said that there was no question of whether the Department of Justice would lead prosecutions under the proposed new National Security Law, and whether common law principles would prevail. SCMP.
Continue reading Hong Kong briefs: 6/2/2020
This has been a tough week for Hong Kong. The drama will only conclude tonight, while most of the city’s residents are asleep, when US President Donald Trump announces what he plans to do about Beijing’s imminent imposition of national-security legislation in the Special Administrative Region.
Putting aside the irony that China’s leadership is about to be judged by someone who cannot accept fact-check warnings on his tweets, it needs to be noted that the situation here is not as grim as many media commentators have been claiming. Foreign businesses have good reason to worry about how they will be affected by national-security legislation, but, as AmCham president Tara Joseph has pointed out, details of the impending legislation still need to be seen before a judgment can be made. It seems safe to assume that people like “Long Hair” and, possibly, Joshua Wong, will soon be skipping town, but there is a broad cross-section of society that would do well to follow Joseph’s wait-and-see approach.
Continue reading Hong Kong awaits the tweet
US plus three: The US has stepped up diplomatic pressure against Hong Kong’s impending national-security legislation, forming a common position with the UK, Australia and Canada. In a four-nation statement, US Secretary of State Mike Pompeo and his counterparts called on China to work with Hongkongers on forging a way forward to honour its commitments made under the Sino-British Joint Declaration. SCMP.
Europe softer: European leaders are in no mood to follow the United States in threatening trade sanctions against China, although foreign ministers were scheduled to meet today to try to hack out a common position. SCMP.
Continue reading News related to national-security legislation
New Guangzhou: Guangzhou has released a plan to revitalize its traditional old central area around Shamian Island and the nearby northern bank of the Pearl River. This was the heart of British and American trading activities back in the pre- and post-Opium War days until the Party came to victory in 1949. The plan will upgrade traditional industries and introduce new ones to the area. It will include a financial cluster. Dayoo.
Jobs push: Guangzhou aims to create more than 200,000 new jobs this year, despite the ravages of the coronavirus on the local economy. Dayoo.
Continue reading GBA Briefs: 5/29/2020
Hong Kong crisis: US senators have proposed a bill that would allow for sanctions against anyone with a role in violating “China’s obligations to Hong Kong under the [Sino-British] Joint Declaration and the Basic Law”, and on banks who do business with them. President Donald Trump has not yet weighed in on the specifics of what his administration plans to do in response to China’s announcement of its imminent imposition of national-security legislation in Hong Kong, but, when asked if he was prepared to use sanctions against China over the issue, he said: “We’re doing something now. I think you’ll find it very interesting. It’s something you’re going to be hearing about … before the end of the week – very powerfully.” SCMP
Law’s scope widened: Beijing’s proposed resolution for a national security law for Hong Kong was amended on Tuesday in an unexpected move that expanded its scope to prohibit “activities” that would “seriously endanger national security”. SCMP.
Continue reading GBA Briefs 5/27/2020
The central government is planning to pump more than 10 trillion yuan (US$1.4 trillion) from now until 2025 into the economy through the roll-out of “new infrastructure” – which includes a wide range of technology, from next-generation wireless networks to artificial intelligence (AI). The master plan, which will be endorsed by the NPC this weekend, calls on urban governments and private hi-tech giants like Huawei Technologies to help lay 5G wireless networks, install cameras and sensors, and develop AI software that will underpin autonomous driving to automated factories and mass surveillance. SCMP.
Guangdong is already well ahead of the plan. As covered previously, the province has begun work on eight of 10 planned new industrial parks, which will be used for experimentation and development of new technologies. Basically, these involve the creation of products and services that run on AI-driven computing power stored in data centers and distributed via 5G networks. Think autonomous cars and robotaxis, smart washing machines and fridges, intelligent buildings, cutting-edge medical devices, and so on.
Continue reading ‘New infrastructure’ plan unveiled
NPC takes aim at HK: Beijing will establish a sound legal system and enforcement mechanism for safeguarding national security in Hong Kong, Premier Li Keqiang said today at the opening session of the 2020 National People’s Congress. A resolution was tabled to enable the Standing Committee of the NPC to craft and pass a new national security law tailor-made for Hong Kong. It would require the city’s government to set up a specific organisation to do the job. SCMP.
Business reacts: The NPC’s passage of an annex to the Basic Law covering national-security legislation is a worrisome development that will erode the city’s global reputation and attraction as a corporate base, according to business groups, security and legal experts in Washington. Others were more sanguine, however, saying most companies with Hong Kong operations are focused on the bottom line, unlikely to act on principle and remain in a wait-and-see mode even as they bridle at Beijing’s latest move. SCMP.
Continue reading GBA Briefs: 5/22/2020
The central government has issued a guideline to “accelerate the improvement of its socialist market economy in the new era”, which analysts are saying is the boldest economic reform launched by the current leadership since President Xi Jinping took office.
According to Xinhua, the country’s goal is to “build a high-level socialist market economy that is more systematic, mature and well-shaped”, which would keep public ownership “as the mainstay” while allowing “multiple forms of ownership to develop together.” It stressed minimizing the government’s “direct allocation of market resources and direct intervention in microeconomic activities.” Read Xinhua for the full text.
Continue reading Beijing announces sweeping economic reforms