Tag Archives: Xi Jinping

Macau gets its ‘red packets’ from Xi

President Xi Jinping’s visit to Macau last week for its 20th anniversary celebration ended up being everything that the SAR expected – and more.

A lot more.

In a series of announcements that came late in the day – after most media outlets had put to bed their Macau coverage – central government agencies unveiled policies designed to boost Macau’s economic development and integrate it more closely with neighboring Zhuhai via the special economic zone of Hengqin.

The most eye-catching of these came from the National Development and Reform Commission (NDRC), which focused on plans to support Hengqin in establishing a so-called “Guangdong-Macau Deep Cooperation Zone.”

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Try harder, Xi tells Hong Kong govt

It is becoming clearer that something has shifted in Beijing’s approach to governing Hong Kong. We pointed out the beginnings of this shift last week, after CE Carrie Lam’s visit to Shanghai and Beijing, where she met President Xi Jinping and her direct report, Vice Premier Han Zheng. She came back more confident, less inclined to give middle-ground statements on the protests. We speculated that it was because the central government had reached a new consensus on Hong Kong, and a change of direction was needed: restrained passive-aggressive interventionism was out; active, overt policy guidance was in.

However, until late yesterday, it hadn’t seemed like the new approach was being timed on a stopwatch. The central government was upping the pressure to introduce national-security legislation, but no deadline had been hinted at.

Then President Xi Jinping interrupted a busy schedule on his overseas trip to comment on the situation in Hong Kong. He reiterated that he wants to see the Hong Kong government and police do whatever is necessary to put an end to the protests. It was no longer just the Hong Kong government’s most important task; it was now its most “urgent,” too.

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World holds breath for Xi-Trump meeting

The meeting with US President Donald Trump has not yet taken place. But President Xi Jinping took his opportunity at the G20 summit today to lay out China’s commitment to the next round of its Opening and Reform program, pledging five major initiatives. According to a release from the People’s Daily, these included: 

  1. Further opening 

We are about to release a 2019 edition of the negative list of foreign investment to further expand the opening of agriculture, mining, manufacturing and service industries. Six new free trade pilot zones will be established, and an additional new section in the Shanghai Free Trade Zone, while we will accelerate the process of building a free trade port in Hainan.

  • Expand imports

We will further proactively reduce tariffs, work hard to eliminate trade barriers, and drastically reduce the intermediary costs for imports. We will continue to host the second edition of the China International Import Expo.

  • Improve business environment

We will implement a new foreign investment law on January 1 next year, introduce a punitive damage compensation system, enhance the civil and criminal protection, and improve the protection of intellectual property.

  • Equal treatment for all

We will completely remove the restrictions on foreign investment access outside the negative list. We will treat all registered companies in China equally, establish and improve complaint mechanisms for foreign-funded enterprises.

  • Promote economic and trade relations

We will push forward a regional comprehensive economic partnership agreement, accelerate the negotiation of China-EU investment agreements and the China-Japan-Korea Free Trade Agreement. Read more.

Deal done?

Stock markets around the world are liking news of an apparent deal between the U.S. and China on their trade dispute ahead of the all-important Trump-Xi meeting at the G20 this weekend. As SCMP reports:

The US and China have tentatively agreed to another truce in their trade war in order to resume talks aimed at resolving the dispute, sources familiar with the situation said.

Details of the agreement are being laid out in press releases in advance of the meeting between Chinese President Xi Jinping and US President Donald Trump at the Group of 20 summit in Osaka, Japan, this weekend, according to three sources – one in Beijing and two in Washington. Such an agreement would avert the next round of tariffs on an additional US$300 billion of Chinese imports, which if applied would extend punitive tariffs to virtually all the country’s shipments to the United States.

However, as realists among the political-analyst community continue to point out, deals like this are patch-up jobs, and will continue to be so for the foreseeable future. The two sides remain far apart on fundamentals.

That doesn’t mean it is all bad news ahead. On the contrary, China in the meantime – and especially in the GBA – is shifting as fast as it can to getting US proprietary technology out of its supply chain, which is having a galvanizing effect on the economy. In particular, three priorities are being pursued AVAP (as vigorously as possible): 1) Like Gree, invest tens of billions in MYOC (make your own chips) and other key tech; 2) Offer every subsidy you can think of to attract talented people into your “innovation hubs”; and 3) Refocus your sales teams on a) domestic markets and b) Non-U.S. markets.

To be sure, GBA investors have much to be thankful for. Companies here look likely to get a bit of short-term breathing space, while the bigger picture of “industrial upgrading” continues apace. As Michael Enright, the GBA guru at Hong Kong University, likes to point out, think of the GBA within China, a market of 1.4b people, the way you would think of Germany within Europe at the early stages of the post-war period. It’s easy if you try.

Read more on the deal at SCMP.