Following is a summary of major news and comments in the Hong Kong Economic Journal, the parent publication of EJ Insight, on Tuesday, Jan. 28:
Hong Kong stocks seen falling further as holidays near
The Hong Kong stock market is expected to further test a lower ground ahead of the Lunar New Year holidays amid worries that the Federal Reserve will step up efforts to taper off its bond buying scheme, which could drive funds out of emerging markets, analysts said after the city experienced a panic sell-off on Monday. The benchmark Hang Seng Index has slid 4.8 percent over the past trading days to close at 21,976 points, making room for investors to bottom-fish policy-driven stocks, they said.
Mainland think tank calls for more relaxed monetary policy
The Chinese Academy of Social Sciences has urged the government not to over-tighten its monetary policy as the foundation of a sustainable economic recovery is not yet certain and the global economy is still regaining its growth momentum. The government think tank suggested that the money supply growth target should be set at 14 percent for this year, surpassing the actual reading of 13.6 percent in 2013. Financing more easily accessible to secure growth in employment and the economy, it said.
New technology bureau likely to get nod from legislature
Andrew Liao, senior counsel and non-official member of the Executive Council of Leung Chun-ying’s administration, said the plan to establish an Innovation and Technology Bureau is likely to get through lawmakers. Liao said the bureau will be established by spinning off certain functions and units from the existing Commerce and Economic Development Bureau and bringing together the resources of the Hong Kong Science Park, Cyberport, and the Innovation and Technology Fund. The administration also plans to set up the world first-ever exchange for the transaction of intellectual property rights, he added.
Official media plays down mainland-Hong Kong frictions
China’s official People’s Daily has launched a blitz of publicity to play down frictions between mainland China and Hong Kong, insisting Beijing has always lent a supportive hand to the city. It cited the mainland’s supply of water, food and electricity to the city as well as supportive economic policies. The newspaper’s overseas edition on Monday published four articles on mainland-Hong Kong relations, stressing that frictions were only sporadic. It also called on the Hong Kong people to refrain from exaggerating conflicts and making comments that hurt relations.
Graft complaints down by a third in 2013 as scandals hit ICAC
Corruption complaints in Hong Kong last year fell by a third from 2012, according to the Independent Commission Against Corruption’s (ICAC) Advisory Committee on Corruption. The committee said the reduction from 4,000 to 2,600 could have resulted from a greater general avoidance of corruption. But its chairman, Chow Chung-kong, admitted that recent allegations against the ICAC’s former head, Timothy Tong, might have affected public confidence in the anti-graft body. Chow said the adverse impact was short-term, adding that people would still feel confident about reporting complaints to the ICAC in the long term.
Alarm bells over Japan’s public debt as trade deficit worsens
Japan’s trade gap soared to US$110 billion last year, marking the third straight year of deficits. The country’s financial imbalance will inevitably affect the quality of Japan’s sovereign credit. The possibility of credit agencies downgrading Japan’s sovereign credit cannot be ruled out if the financial situation remains bad after a planned hike in consumption tax. The emergence of deficits has already sounded an alarm bell over the sustainability of Japan’s public debt.
Crackdown on low-ranking corrupt officials to intensify in 2014, Ren says
Experts on the Chinese Communist Party said the recent anti-graft speech by President Xi Jinping showed China’s crackdown against corruption will only be strengthened, not weakened, in 2014, Beijing-based China analyst Ren Huiwen writes. In view of the enormity of damage to ordinary people caused by low-ranking officials abusing powers, Ren says the intensity of the crackdown against those cadres would even be greater this year. More officials at city and county levels might have to step down. At the same time, an anti-corruption system will be established as the campaign against unscrupulous officials continues.
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