Following is a summary of major news and comments in the Hong Kong Economic Journal, the parent publication of EJ Insight, on Tuesday, Nov. 19:
HK must capture investment from China forex reserves, sovereign fund, Laura Cha says
The Hong Kong government should step forward to seize opportunities to manage part of the mainland’s huge foreign exchange reserves and asset allocation of the sovereign wealth fund, said Laura Cha, chairman of Hong Kong’s Financial Services Development Council. The government think-tank has also suggested initiatives to strengthen the city’s position as an offshore renminbi center, she said after the release of the first batch of six reports on policy recommendations on ways to foster the development of the city’s financial market. Chief Executive Leung Chun-ying said the government will actively follow-up on the recommendations with related regulatory bodies.
HK market upbeat on China’s decision to deepen national reform, analysts say
The Hong Kong stock market is likely to hold up well in the near term, analysts said, after top Communist Party leaders approved a raft of social and economic reforms at their recent plenum. Some of the initiatives such as relaxation of the decades-old one-child policy have surprised observers. The city’s benchmark Hang Seng Index surged 627 points to 23,660 points on Monday. China’s A shares will be revalued by investors as the direction of national reform becomes clear, analysts said.
ECONOMY AND BUSINESS
China home sales growth may slow to 10%, Moody’s says
Home sales growth in China is likely to slow to about 10 percent in the next year, Moody’s Investors Service said, citing the country’s weaker economic expansion pace. Home sales rose 36.4 percent from a year earlier during the first nine months this year. The outlook for the property sector is moderate, the rating agency said, adding that it does not expect the government to unveil a fresh round of tightening measures to tame residential purchase demand if home prices do not climb too much.
Hong Kong should stay cautious amid QE exit prospects, Stiglitz says
Hong Kong should consider initiatives to combat asset bubbles before the United States Federal Reserve begins to taper its massive quantitative easing program, Nobel Prize-winning economist Joseph Stiglitz told the Hong Kong Economic Journal. The city’s linked exchange rate system has come under attack on the unprecedented debt demand from US. Meanwhile, China’s restricted capital account policy to protect the financial system is feasible, he said.
Treat labor importation, work hours law as separate issues, chamber executive says
Executive director of the Hong Kong General Chamber of Commerce, Shirley Yuen, said the government should take the lead to study importation of foreign workers in view of the labor shortage in some industries including construction, transportation, logistics and services such as retail and catering. She said the issue of labor importation and standard work hours legislation should not be mixed together for bargaining between employers and employees over labor benefits.
HKTV’s Wong to decide judicial review of government TV license decision in 3 months
Chairman of Hong Kong Television Network Ricky Wong said he would make a decision on whether to seek judicial review on the government’s rejection of his application for a free-to-air TV license within three months. He said he had given up hope that Chief Executive Leung Chun-ying would reconsider the Executive Council decision. Without naming Leung, Wong said the license decision had hinged upon “one person”. He hinted that he could wait for the expiry of Leung’s five-year term. But asked what he would do if if Leung was re-elected, Wong said: “That’s not possible.”
China urged to speed up reform to boost confidence in A-share market
There is no denying a number of policy initiatives in the full document approved at the Chinese Communist Party’s recent central committee plenum. The announcement at the weekend has exceeded market expectations, boosting confidence among investors towards China’s reform and development. At this juncture of change, mainland authorities must take advantage of the positive market mood to launch reforms to boost investor confidence in A-shares
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