22 January 2019

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 Wednesday, Feb. 12:


China General Nuclear Power in chase for US$2 bln HK listing

China General Nuclear Power Group (CGNP) is reportedly seeking US$2 billion from a Hong Kong listing in the second half of this year. The power firm has hired China International Capital Corp. and Deutsche Bank AG as arranging banks, Bloomberg reported, citing sources familiar with the situation. China National Nuclear Corp. holds 82 percent of the firm while the Guangdong provincial government has 10 percent and the State-owned Assets Supervision and Administration Commission has 8 percent. CGNP was previously understood to be planning a dual-listing in Hong Kong and on the mainland.

Bank of China exec warns of threat to HK’s RMB edge

Interview: Hong Kong is losing its first-mover advantage in renminbi business as more offshore centers spring up, Bank of China (Hong Kong) Ltd. head of renminbi business Yang Ruhai {楊如海} warned. The city should strive to launch more new products and services to attract fund flows in the Chinese currency, tapping opportunities from the liberalization of interest rates and the foreign exchange rate, Yang said, adding that he expects renminbi deposits in the city to top 2 trillion yuan in 10 years.

January new loans at big-four banks slide 7%

The four largest state-backed banks on the mainland saw their combined new loans in January shrink by 7 percent from a year earlier to come in at 350 billion yuan (US$57.74 billion) as the central bank continued to push for tight control over liquidity in the market. The banks are Industrial & Commercial Bank of China Ltd. (01398.HK), China Construction Bank Corp. (00939.HK), Agricultural Bank of China Ltd. (01288.HK) and Bank of China Ltd. (03988.HK). China International Capital Corp. scaled back its forecast for total new loans in the country last month to about 1 trillion to 1.1 trillion yuan from 1.2 trillion yuan.


Leung rejects HK$100 arrival tax on mainland visitors

Chief Executive Leung Chun-ying has dismissed as unpractical a proposed HK$100 “arrival tax” for visitors to Hong Kong aimed at cutting the massive inflow of mainland tourists to the city. Leung said the proposal by two People Power legislators could prompt the mainland authorities to put a similar tax on Hongkongers visiting the mainland. He said mainland visitors have brought enormous benefits and jobs to Hong Kong, adding the city “should not become arrogant even before it becomes rich.”

Philippines ‘risks tougher action’ over Aquino apology failure

The official Xinhua news agency has warned Philippine President Benigno Aquino of sterner punitive measures, including limits on visits of its nationals to Hong Kong, if he refuses to apologize for the Manila hostage tragedy. Xinhua yesterday ran an article written by a People’s Daily reporter, who vehemently attacked the president as disrespectful and illogical for refusing to say sorry for the deadly incident. It warned that the country risked a heavy economic toll if Hong Kong restricted work permits for Filipino domestic helpers in the city.


Hong Kong well placed for Xi-Ma meeting

The first official talks between Wang Yu-chi {王郁琦}, chairman of Taiwan’s Mainland Affairs Council, and his mainland counterpart, Zhang Zhijun {張志軍} of the State Council’s Taiwan Affairs Office, in Nanjing yesterday carried historic weight. It signaled further progress in cross-strait relations, creating conditions for political interactions between both sides. Taiwan President Ma Ying-jeou is keen to meet President Xi Jinping in international settings but Beijing is not likely to accept. Hong Kong, however, could be an appropriate venue for a Xi-Ma meeting.


Ex-minister floats visa curbs, border tax to slow mainland arrivals

Hong Kong should gradually replace multiple-visit permits with a single-entry visa for mainland visitors to help ease daily pressures on Hong Kong people, former civil service minister Joseph Wong wrote. Wong said the government could also consider a levy similar to the border construction tax mulled by former financial secretary Antony Leung in 2003 to help curb the influx of mainland visitors. A HK$30 levy, for example, could generate a recurrent income stream of HK$10 billion.

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