18 September 2018

HKEJ Today: Highlights

Following is a summary of major news and comments in the Hong Kong Economic Journal, the parent publication of EJ Insight, on Friday, Nov. 15:


Mary Ma appointed SFC non-executive director

The Hong Kong government has appointed Boyu Capital Advisory Co. Ltd. chairperson Mary Ma Xuezheng {馬雪征} as a non-executive director of the Securities and Futures Commission for a term of two years with effect from Friday. Observers said the appointment is in line with the government’s strategy to develop the city’s asset management sector, and international advocacy for more women directors. Ma, who is a member of the Listing Committee of Hong Kong Exchanges and Clearing Ltd. (00388.HK) and holds titles in the boards of four listed companies including Lenovo Group Ltd. (00992.HK), set up the private equity firm Boyu Capital last year with Alvin Jiang Zhicheng {江志成}, the grandson of China’s former President Jiang Zemin {江澤民}, and Louis Cheung Chi-yan, former president of Ping An Insurance (Group) Co. of China Ltd. (02318.HK).

StanChart said to trim private-equity division staff by 12 percent 

Standard Chartered Plc. (02888.HK) is said to downsize its private-equity division by laying off 12 percent staff and bring it down to about 100 people. Most of the affected jobs will come from Asia, including both senior and junior positions, Bloomberg reported, citing sources familiar with the matter. The PE arm has invested over US$3.9 billion since establishment, mainland in Asia, Africa and the Middle East. The group had not unveiled any layoff plan earlier but has set a goal to control the total number of staff at 87,000 by the end of this year, 2,500 fewer than last year.


China becomes largest gold consuming country in the world

Rising demand has made China the largest gold consuming nation in the world in the third quarter, surpassing India for the first time, the World Gold Council said. China consumed 209.6 metric tons of the precious metal in the third quarter, up 18 percent from a year ago, sending the total to 779.6 tons for the first nine months this year. Meanwhile, demand from India slid 32 percent to 148.2 tons amid import control, with the first three quarter consumption topping 714.7 tons. The council expects the total consumption of the metal in China to hit a record 1,000 tons for the whole year.

Key fiscal reforms direction shown in top Party meeting, UBS’ Wang says

The top Communist Party leaders meeting, which concluded in Beijing earlier this week, has brought fiscal reforms to a new level that is aimed to reallocate resources and enhance fairness in the society, said Wang Tao {汪濤}, UBS A.G. chief economist for China. In a research report, Wang said the meeting has flagged measures improve the taxation regime and transparency of government budgets, which are long-term mechanisms that can benefit the financial balance of local governments, allowing them to issue bonds in the next step. Wang expects more policies to be unveiled at a later stage with regard to loosening of control over certain restricted industries.

Smaller brokerages’ calls for more room have paid off, Cheung says

Hong Kong’s Securities and Futures Commission has recently decided to move to a passive approach instead of an active one in the oversight of brokerages that seek mainland clients. Lawmaker Christopher Cheung said the move shows the efforts of smaller market players in seeking larger room for business have paid off. Cheung said he has been in discussion with the securities watchdog and other authorities to relax their controls. A proposal has also been sent to Chief Executive Leung Chun-ying and Financial Secretary John Tsang, urging measures to boost development opportunities for small to medium-sized brokerages in the financial market.


HKU law expert casts doubts on powers of courts, legislature in TV licensing

A legal professor of the University of Hong Kong, Albert Chen, said a judicial review against the government’s decision not to grant a free-to-air television license to Hong Kong Television Network cannot effectively resolve the dispute. He said courts can only rule on the validity of the procedures of government decision, but not the decision itself. Similarly, he said even if the legislature decides to invoke the Powers and Privileges Ordinance it cannot replace the government in issuing a license to HKTN. Chen said the government can still refuse to explain further its licensing decision.

DAB proposes six-month-long consultation for political reform

The Democratic Alliance for the Betterment and Progress of Hong Kong has proposed lengthening the first round of consultation on political reform to six months to allow ample time for public debate. The government plans to launch public consultation on electoral reforms by the end of this year. Pan-democrats dismissed the six-month-long consultation idea as an attempt to allow the government to delay proposing a detailed electoral model. A source said extending the consultation period to six months would create “technical difficulties” in the political reform process.


Japan’s slower third-quarter GDP growth rings alarm bell over Abenomics

Japan’s annualized gross domestic product growth in the third quarter slowed to 1.9 percent on weak growth in consumption and exports. It showed the stimulus power of Prime Minister Shinzo Abe’s policies, known as Abenomics, has shown signs of weakening. The risk of a slowdown in the pace of recovery has increased, putting more pressure on Japan’s central bank to increase the scale of monetary stimulus. Although the chance of a return to recession is slim, it rings an alarm bell over the effectiveness of Abenomics.


Legislators urged to veto funding for RTHK’s HK$6 billion new building

The government-run Radio Television Hong Kong is seeking a funding of HK$6 billion from the Legislative Council for construction of a new broadcasting center. RTHK should play the role of a public service broadcaster and stop producing programs that compete with privately-run broadcasting companies, public affairs commentator Albert Cheng King-hon wrote. RTHK is now doing the opposite asking for huge funding for such facilities as a news center. Legislators should veto the project.

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