Date
19 August 2017

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 Thursday, Dec. 5:

TOP STORIES

MIIT grants 4G licenses to three telecom carriers

China’s Ministry of Industry and Information Technology (MIIT) has issued licenses for TD-LTE, the country’s 4G standard, to the parent companies of China Mobile Ltd. (00941.HK), China Telecom Corp. Ltd. (00728.HK) and China Unicom Hong Kong Ltd. (00762.HK). Analysts expect China Mobile to use subsidies to boost subscribers for the new network, potentially spurring a price war in the market. The ministry, meanwhile, has allowed China Mobile for the first time to run fixed-line services. But it is yet to grant any licenses for the international 4G standard, FDD-LTE, pending applications from local telecom carriers.

Macau urged to diversify economic growth pillars

The Macau government should use the interim review of gaming licenses in the city next year to require casino operators to develop more space for non-gaming activities, in a bid to diversify sources of income and pillars for economic growth, analysts said. The review will cover all of the six existing licenses, which will have to be renewed in 2020 and 2022. Market observers are hoping that the operators will boost investment in non-gaming infrastructure to enhance businesses such as exhibition and conference services, sports and culture, as well as food and beverage.

ECONOMY AND BUSINESS

Shui On Land to sell Taipingqiao project for 3.4 billion yuan

Shui On Land Ltd. (00272.HK) has entered into an agreement to sell its Taipingqiao commercial project in Shanghai to China Life Trustees Ltd., a wholly-owned subsidiary of China Life Insurance (Overseas) Co. Ltd. for up to 3.4 billion yuan (US$558.15 million). The developer, which has gathered a total of HK$15.3 billion since the beginning of the year from rights issues, introduction of new investors to existing projects and divestment of non-core assets, is expected to reap a pretax profit of 192 million yuan from the transaction, with proceeds to be used for repaying debt.

Discussion on mutual recognition of funds enters final phase

Discussion on the arrangement for mutual recognition of funds between the authorities in mainland and Hong Kong has entered the final phase, said Alexa Lam, deputy chief executive officer of the Securities and Futures Commission and executive director of its investment products division. The securities watchdogs of both sides have reached a preliminary consensus on a regulatory framework that covers six key aspects of the arrangement. These key aspects include the product range and approval procedures.

Samsonite plans to expand business in Asia

Samsonite International S.A. (01910.HK) is planning to launch two high-end product lines, Hartmann and High Sierra, in the Asian market in the fourth quarter, and strengthen efforts to promote the sales of a new line, Samsonite RED, in eastern Asia next year, said chief financial officer Kyle Gendreau. The company posted net sales of US$570 million in Asia for the three quarters ended September, up 14.7 percent from a year ago. The luggage maker is seeking acquisition opportunities in South Korea and Japan, Gendreau added.

POLITICS

Hong Kong officials warn society will pay huge price for reform failure

Hong Kong officials have warned of adverse economic and political effects and a huge price for the whole society if talks for consensus on political reform fail. Kicking off a five-month-long consultation on a 55-page consultation document, Chief Secretary Carrie Lam said the city has entered the final stage of a march towards universal suffrage. But pan-democrats described the journey as being laden with obstacles, referring to the restrictions over universal suffrage imposed by Beijing.

Pan-democrats slam proposed nomination system for 2017 CE election

In a departure from the present system, the Hong Kong government has proposed that the universal suffrage for the 2017 chief executive election should be conducted through “institutional nomination” by a nomination committee. Under the 2012 CE election, any candidate who received 150 nominations from the 1,200-member election committee could automatically become a candidate. In a consultation paper released yesterday, the government said a candidate should be approved by the whole nomination body. Pan-democrats said the new arrangement is aimed at screening out candidates that Beijing does not want.

EDITORIAL

Seek compromise, not extremes in universal suffrage debate

Public expectation for universal suffrage in Hong Kong has reached a peak after debate started in 2004. The idea of seeking change through civil disobedience Occupy Central movement, however, is not worth encouraging. The city’s democratic development should proceed under the political reality of “one country, two systems”. Beijing should have more confidence in the people of Hong Kong. The direction of rational discussion is to seek compromise, not extremes to avoid the shocks that might arise if the political systems “march on the same spot”.

COMMENTS

China ADIZ reflects revival of Mao-style decision-making

China’s decision-making pattern has marked a major change after the conclusion of the Communist Party’s third central committee plenum, veteran China watcher Ding Wang wrote. The thinking behind the setting up of air defence identification zone (ADIZ) is building a strong nation under “strong-man leadership” aimed at seeking a bigger say in international affairs. The revival of “Mao Zedong-style” decision-making and foreign policy thinking warrants deep thought. The intention of ADIZ is not just to enhance surveillance of air defence, but to show China’s military and regional might.

– Contact us at English@hkej.com

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