Category Archives: Policy

Hong Kong gets its Act; what now?

Hong Kong’s position in the world spotlight is moving fast. Now that the US Congress has approved the Hong Kong Human Rights and Democracy Act, which President Trump seems ready to sign into law, the world’s focus on the rule of law in Hong Kong will likely take on a broader dimension. Every time the central government does or says something related to the power of Hong Kong courts to issue rulings, foreign investors will need to hold their breath and remain that much more alert to what the reaction could possibly be from the United States. 

Never mind all the high-falutin language about freedom, the new law’s real threat is if it forces a review of Hong Kong’s special trading status, separate from the rest of China. If Hong Kong has its status revoked by the US, the blow to not only the flow of goods, but of finance, between the two countries could be devastating. 

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Qianhai Justice Center opens for business

On a corner of the Qianhai special economic zone in Shenzhen, a new building was recently opened. But this building is unlike any other of the gleaming high-rise office towers going up in the district. It is filled with judges, lawyers, and legal assistants from all over the world, and its mission is nothing less than to boldly push forward reform of China’s justice system – with Hong Kong as a partner.

The Qianhai Justice Center, the first permanent public building in Qianhai, is a part of a “national pilot demonstration area of law-based governance”. Begun in 2014, it was completed in August and opened for business on November 6. Its mission is to provide “one-stop legal services” to members of the public from anywhere within the Greater Bay Area: notarization, mediation, intellectual property rights registration and enforcement, accounting services, and in-house legal advisory services.

This is what being a Pioneering Zone for Socialism with Chinese Characteristics is all about.

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Baishizhou: a tale of Shenzhen’s housing challenge

Shenzhen’s housing policies have been the focus of intense online discussion in recent months, with many commentators and analysts comparing them to Hong Kong’s. The city’s plans to build 1.7 million new homes by 2035, at a rate of more than 80,000 per year, are unthinkable for Hong Kong, where the government has said it hopes to build 10,000 new social-housing units in the next three years. Moreover, Shenzhen has made it clear that 40% of its housing supply will be earmarked for subsidized housing – in comparison with its neighbor, where 29.1% of households live in public rental housing and another 15.5% in subsidized home ownership housing.

However, Shenzhen is not without challenges of its own in achieving these goals. And sometimes, examples come to light showing the complexity of the city’s housing market. One such case is the redevelopment of the Baishizhou neighborhood.

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GBA firms happy, but want more

Over the past year, it has seemed like not a month could pass without a local government pointing out how much it had “given back” to companies via tax cuts and other subsidies, to help them cushion the current economic slowdown. Unsurprisingly, therefore, a survey by the province’s leading business media group has found that a high percentage of companies based in Guangdong’s nine GBA cities are satisfied with the region’s business environment. 

When pressed further, however, most say that they would like more. Further tax cuts and lower labor costs would be nice, they say. Moreover, at least a third of them would like to see “integrated market rules” in the Greater Bay Area.

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Zhuhai pushes hukou reforms

Zhuhai is pioneering a change in the way cities treat their migrant workers. People living in the municipality without a formal household registration (hukou) are now able to apply for various types of housing previously restricted to hukou-holders.

A public consultation draft has been issued on the city government’s website, which deletes the old category of “migrant workers” and incorporates it into a new category of “newly employed workers.” At the same time, the draft expands the coverage of its public-housing rental policy to “talents”, while dropping their effective rates from 50% of a project’s benchmark rent to 30% – an effective 40% rent cut. 

Whether other cities follow suit remains to be seen. Stay tuned.

Read more (in Chinese).

In Hong Kong, rule of law test under way

There has been much debate in the media recently, on both sides of the protests, about whether the rule of law was being challenged or undermined. Much of it missed the crucial understanding of what the rule of law means – from a Western perspective, at least. 

Even those arguing for the rule of law, but who are against the police, have often failed to distinguish between abuse of the law and a failure of the rule of law. These are different concepts.

Those calling for judges to play their role in putting down the protests and returning Hong Kong to stability, meanwhile, are obviously talking about rule by law, which is also a different concept. 

In any case, Hong Kong is about to get the most vivid test of whether the rule of law is intact here – but it is likely to spawn a new round of controversy and endless debate over what the rule of law means. 

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Shenzhen No. 2 for innovation

Shenzhen is ranked only behind Beijing for the strength of its innovation-led business environment, according to an authoritative report released in Beijing.

According to the 2019 China Innovation City Evaluation Report, conducted by the state-run China Urban Development Research Institute, innovation is generally on the rise across the country. Its evaluation methodology scores the cities surveyed at an average of 67.12%, which is 3.87 percentage points higher than the previous year. 

Shenzhen scored 80.41%, up 2.58 percentage points from the previous year. The city stood out for several advantages, such as ratio of R&D spend to sales, proportion of new product sales in overall sales, number of new patents per 10,000 employees of industrial enterprises, number of PCT patent applications per billion Renminbi of GDP, and number of United States-based patent holdings per billion Renminbi of GDP, among others.

Guangzhou ranked eighth with a score of 61.35%, up 1.66 percentage points from the previous year, which boosted its ranking by four places. Its advantages were noted in human resources and quality development, especially the proportion of the population with tertiary degrees or above, labor productivity, capital productivity and other indicators.

The research institute worked together with a wide grouping of other elite state institutions to compile the report. These included various units from the Central Party School’s administration division, National Development and Reform Commission, Ministry of Science and Technology, as well as universities and research institutes across the country. 

The report made special mention of progress being made in the Greater Bay Area, calling it the “gateway for China’s southern region to open to the outside world”.

Guangzhou, Foshan to build ‘trillion-plus’ zone

Guangzhou and Foshan are planning to jointly develop a new Greater Bay Area “hub” centered on the Guangzhou South Railway Station. The aim of the project is to create a cluster of new strategic industries, with input from Hong Kong and Macau, which will be valued at more than RMB 1 trillion.

The announcement of the project, which is grandly titled “South Station Area”, was made late last week but took a few days to be picked up by local media. Here are the basic facts:

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Hong Kong’s role in GBA: keep calm and carry on

Carrie Lam, Hong Kong’s chief executive, has received a bag of 16 goodies from her bosses in Beijing related to Hong Kong’s role within the Greater Bay Area. And the city’s role, in case anyone was wondering, is “completely unchanged”, she says.

The shiniest of these gifts from the central government is a complete relaxation on restrictions for Hong Kong residents to buy apartments in the nine Guangdong cities of the GBA.

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Top Shenzhen official busted for graft

Shenzhen has announced the fall from grace of a senior official: Li Longwen, former deputy director of the city’s Port Authority, has been dismissed from public office and expelled from the Party.

The announcement came after an investigation by the city’s Commission for Disciplinary Inspection, the anti-graft agency, which found that Li had “lost his faith” and was “not loyal to the Party”. Moreover, he had compounded his errors of judgment by confronting and challenging the investigation, according to the local media report.

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