Tag Archives: Carrie Lam

Hong Kong’s future lies in islands

Late last week, Xia Baolong told a gathering of Hong Kong’s elite that the city’s future leader had to prioritize fixing the housing market. He might have been motivated by an article that had appeared a few days before, making fun of the fact that the cost of a decent-sized flat here is what one could pay to live like an Italian duke. Or maybe he had been  troubled by an analyst predicting average prices for Hong Kong homes are set to rise another 10%-20% this year.

It is not likely he was bothered by the impact on housing prices of “real and painful” talk of Hongkongers leaving the city, because Hong Kong’s current leader, Chief Executive Carrie Lam, shrugged off that news a few days later, pointing out that there would be plenty of reasons for new arrivals to be happy with the state of affairs here.

Lam might have been a bit miffed that Xia had not been reading between the lines of her interviews with local media earlier in the week. She had said that fixing the city’s property woes is her top priority for the last year of her current term. She also hinted at running for another five years, indicating that her Policy Address in October will be “visionary”.

Critics pounced to say that her past failures are an indication of the likelihood of future success on property policy. Yet what this might be overlooking is that substance could make up for Lam’s style shortcomings this time, now that she has a National Security Law to back her up.

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New direction set for Hong Kong

It is fitting that Fintech Week took place at the same time as Carrie Lam’s duty visit to Beijing last week. The three-day event, held at the AsiaWorld Expo Center, provided a reminder of Hong Kong’s enduring value for the Greater Bay Area. As the city’s tourism industry withers after 15-plus years of rich yields, Hong Kong needs a new Chinese export to sell. Financial technology is one of the most promising, and Fintech Week was done well. Its success supported the Chief Executive’s declaration, at the end of her Beijing trip, that Hong Kong’s role within the GBA was “completely unchanged”.

She is right. Selling Chinese goods and services to the world has always been Hong Kong’s strength. From textiles, to toys, to computers, and, yes, to the spending power of mainland tourists, Hong Kong has, to date, been the best place to get a deal done. Until China completely liberalizes the Renminbi, it will remain so. This is a major reason why the Greater Bay Area masterplan was drawn up in 2017 and launched in February of this year: the region needs Hong Kong to put its companies on the world stage. International marketing is Hong Kong’s forté.

Until Lam’s trip to Beijing this week, it had appeared that Hong Kong was playing another, unspoken role within the Greater Bay Area (and the country): as a salon for debating ideas about the future, and as a laboratory for testing their applications. This premise was established by the late Deng Xiaoping in his prescient 1984 agreement with the late Margaret Thatcher, which laid the foundation for the “One Country, Two Systems” principle that underpins the Basic Law. He clearly wanted to see what China could learn from a melting pot of East and West on its doorstep.

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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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GBA Briefs: 11/9/2019

Gree energy: Gree Electric boss Dong Mingzhu is finding time amid the bidding war for her company’s shares held by the city government to chair another joint-venture, this one involved in new-energy industries. Read more on Yicai Global.

Keep calm and Carrie on: Hong Kong CE Carrie Lam welcomed more than 5,000 delegates to the city’s Belt and Road Initiative Forum today, saying the “Hong Kong spirit” will overcome the current turmoil. This followed an evening of protesters singing their own anthem in shopping malls and soccer fans booing the national anthem. Read the SCMP’s wrap.

No more panic: China must stay alert to the possibility of a severe market disruption in case the trade war deteriorates further, as a repeat of the 2015 sell-off will shatter the confidence of international investors, Jessie Pak, managing director for Asia at FTSE Russell, tells the SCMP.

HK says a big NO to Social Credit Rating

Hong Kong’s hapless Chief Executive, Carrie Lam, cannot even pacify demonstrators by telling them the extradition bill is “dead”. While she continues to seek talks with student leaders to end the current standoff, in the hopes of keeping a lid on unrest that still has the potential to flare again into large-scale protests, it has become clear that her government is all but paralyzed. 

Little surprise, then, that her mainland affairs secretary was quick to deny reports that the mainland’s Social Credit Rating system is to be introduced into Hong Kong. It would be hard to imagine a bigger match being lit to the flame of tensions gripping the city than this one. 

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What now for Hong Kong?

Is Hong Kong heading toward becoming ungovernable? The question may sound silly at best and unnecessarily alarmist at worst. But it is worth pondering what the worst-case scenario is for the Special Administrative Region since the astonishing events of the weekend, when two million people from all walks of life marched peacefully (and cleanly) from Causeway Bay to Central.

To say the march was an event worthy of the Nobel Peace Prize might not be an exaggeration. It is hard to think of a similar act of political courage taking place on this scale in recent years anywhere in the world. Moreover, the restraint – shown by both protesters and security forces – was deeply admirable. It has led to a situation today where Carrie Lam, the city’s Chief Executive, has been humbled to the point of calling a special press conference, at which she literally begged for her people’s forgiveness.

However, she did not go as far as the protesters would have liked. This much seems obvious from reactions. There remains a yawning gap between her administration’s willingness to meet their demands, and the clear majority of the public’s expectations.

While the unpopular legislation that sparked the protests has been suspended, it has not been withdrawn, and it would appear that other, unrelated legislation is in the works that could easily trigger the next round of street protests. The question, therefore, on the minds of many, must be: When will this standoff be resolved? And the answer, increasingly, is starting to look like: Not in the foreseeable future.

We are not easily alarmed, and we happen to believe that there are smart, level-headed people on both sides of this divide. But it is hard to see how Hong Kong can continue to operate in virtual limbo like this for a sustained period of time before its machinery starts to crack – or, worse, tempers start to flare to the point where attitudes harden and actions become more dramatic. The city’s institutions are strong, but not impervious to unrelenting pressure.

We do not yet see a scenario unfolding where capital starts to flee and businesses start to shut down on a large scale here. But we would caution our readers against complacency at this moment. Hong Kong is on a knife’s edge, and no amount of goodwill coming across the border in the form of the Greater Bay Area’s development plan is likely to help while this tension continues. The best that can be hoped for, as far as we can see, is for centrist-minded mediators to speak up more loudly, and for both sides to make greater effort to re-establish a common ground. Foreign investors, in particular, ought to have their political antennae tuned carefully to local media in the coming days, weeks, and, probably months. 

HK says no change after 1.03m march

A record 1.03 million people marched through the streets of Hong Kong yesterday in protest against a planned law that would plug a loophole in the city’s rendition agreements and allow fugitives to be sent to the mainland. The Hong Kong government responded late last night by saying that the bill would not be deferred, and would go through the legislature tomorrow.

Hong Kong’s chief executive, Carrie Lam, said she would not resign, and she reiterated that the freedoms and rights of Hong Kong people had not been eroded.

All we can add to the story is a perspective on how it relates to the Greater Bay Area. What is happening now should be set against the backdrop of the region’s masterplan, which runs until 2035, 12 years before 2047, the end of the Special Administrative Region’s term. Legal and administrative reforms are at the heart of the mission to integrate and streamline the operations of Hong Kong and Macau plus the nine Bay cities of Guangdong. We expect to see the gap between the three jurisdictions narrowed over the course of this plan. We expect to see the rule of law strengthened throughout the entire Greater Bay Area. And we expect to see the region become more internationalized along the way.