19 November 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 Monday, Jan. 20:


SHK Properties’ Thomas Kwok welcomes land premium arbitration scheme

An extra supply of 4,000 to 5,000 new home units each year may be created by the introduction of a pilot scheme for land premium arbitration in Hong Kong that was suggested in the latest policy address of Leung Chun-ying, said Thomas Kwok, joint-chairman and managing director of Sun Hung Kai Properties Ltd. (00016.HK). The arbitration scheme is a breakthrough in government land policy that can stabilize property prices in the long term, Kwok added. Analysts and academics, however, said the scheme is a double-edged sword that may lengthen the negotiation of land premium between the government and developers

B-to-H share listing disregarded by CSRC new leaders

A special channel for converting the international investor-oriented B shares listed in the mainland into H shares traded in Hong Kong has received little policy attention from the new leadership of the China Securities Regulatory Commission after Xiao Gang {肖鋼} took the helm of the regulator, sources said. The negligence is said to have caused the prolonged approval of the H-share listing plan of Livzon Pharmaceutical Group Ltd. (01513.HK), the second company using such a conversion listing method, possibly making China Vanke Co. Ltd. (000002.CN) the third and the last one, they said.

Shui On Land management restructuring may take three years to complete

Interview: Shui On Land Ltd. (00272.HK) is poised to turn more active in land acquisition as the company reforms its management structure, said chairman Vincent Lo. The restructuring, which is expected to take two to three years to be completed, will replace the chief executive function with an executive board led by Lo for the time being, after Lee Chun-kong resigned from the senior position. Lo said certain land purchases will be made in the first half this year but the company’s development goals and sales targets are yet to be revealed.


Anson Chan dismisses elitist idea for election system as ridiculous

Former chief secretary Anson Chan has dismissed as ridiculous claims by a former mainland Basic Law Committee member that the election for the chief executive and legislature in Hong Kong should be tailor-made to “protect elitist politics”. Wang Zhenmin said in Hong Kong on Saturday that the electoral systems should be designed to let a small number of business and political elites play an important role. Anson said the present electoral system lacked legitimacy. She called on the business sector not to hide behind functional constituency elections but to prepare for universal suffrage.

Financial chief gives new warning against drastic spending hike

Financial Secretary John Tsang has cautioned against drastic increase of recurrent government expenditure, adding fears among some people were not unfounded. He called on people to beware of the sustainability of public finance in the face of ageing population. Tsang said it was mere “simple mathematics” that reserves could be depleted if there was no control over expenditure. His remarks appear to be in contradiction with the assertion by Chief Executive Leung Chun-ying that the city still has rich reserves when he announced a HK$20 billion government recurrent spending on welfare in his policy address last week.


More effective, practical use of reserves needed

Although government recurrent expenditure has jumped by 80 percent since 1997, the Hong Kong government is faced with growing public dissatisfaction with the problem of widening rich-poor gap. It shows massive resources spent on welfare have not been systematic and effective. Total reserves are tipped to reach HK$700 billion. Faced with public expectation, the government should review the opportunity and social cost of excessive reserves and formulate a clear, practical management system of reserves.


Crackdown against graft among judicial organs imminent, Ren says

The call by President Xi Jinping to “put people’s interest above everything” in his latest speech on the country’s anti-corruption campaign mirrors the hearts and minds of people, Beijing-based China watcher Ren Huiwen wrote. It was made amid growing public discontent over the abuse of powers of the judicial organs in cases such as violation of people’s rights in the name of upholding social stability. In view of Xi’s pledge to hit hard corrupt officials in the judicial organs, it is clear that authorities have already collected enough evidence of graft among judicial organs. Massive crackdown is only a matter of time.

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