Following is a summary of major news and comments in the Hong Kong Economic Journal, the parent publication of EJ Insight, on Wednesday, Feb. 19:
Macau likely to shorten tenor of new gaming licenses, sources say
Macau authorities are said to shorten the tenor of new gaming licenses as the central government tends to take Sino-US relations as one of the criteria in considering whether or not to keep the licenses in the hands of US operators, sources told HKEJ. The government will no longer issue licenses valid for 20 years, while those for 10 years are likely to be shortened to five years, the sources said, adding that the three existing licenses for US operators have in fact been issued in return to Washington’s support to China’s bid for the Beijing 2008 Olympic Games.
David Li says only high-valuation bids to be considered for BEA
The Bank of East Asia Ltd. (00023.HK) will only consider bids that price the bank at three to four times of its book value, said chairman David Li. More fierce competition from Chinese lenders and stringent oversight by the regulators are squeezing local families out of the banking business, Li added. Analysts said such a high valuation requirement would represent a yield of 3 percent, and suggests that Li may in fact have no intention to sell the bank.
RMB trade settlement seen quadrupling in 10 years, Norman Chan says
Cross border trades settled in the mainland with renminbi are likely to quadruple in 10 years, the chief executive of Hong Kong Monetary Authority, Norman Chan, wrote in his official blog. The growth would mean the proportion of trade settlement in the Chinese currency in the mainland would expand to 60 percent from 15 percent. Meanwhile, Chan expects more foreign firms to use the renminbi as a mean of payment in the mainland, sending the share to 50 percent from 20 percent in five to ten years.
Hong Kong faces deficits as population ages, Liu says
Interview: A leading economist has warned of deficit in Hong Kong in light of ageing population. Professor Liu Pak-wai from the Chinese University of Hong Kong said extra spending on healthcare and welfare would increase total government spending by one to two percent. As labor force shrinks and productivity sees no major growth, government spending will rise at a faster pace than revenue in the long run, Liu said. He warned that Hong Kong would face chronic deficit, similar to what Japan is experiencing now.
Beijing fires salvo amid protests against mainland visitors
Beijing yesterday joined the attack against the “anti-locust” protest staged by a group of Hong Kong people Sunday against the massive influx of mainland visitors to the city. The Hong Kong and Macau Affairs Office under the Chinese State Council said it strongly opposes any moves that undermine the city’s prosperity and stability. It said it supports Chief Executive Leung Chun-ying and the government in handling the issue in an appropriate way. Leung condemned the protest and vowed to deal with the matter in accordance with the law.
Government urged to curb multiple-entry of Shenzhen visitors
The Hong Kong government has acted reasonably to condemn the protestors who adopted radical means to voice their discontent against a massive influx of mainland visitors. But it should also take multiple steps to tackle the host of problems caused by the influx. Some measures such as increase in tourism facilities will take time. One immediate step is to turn the multiple-entry permit of Shenzhen residents to single-entry in each day or each week. Statistics show Shenzhen residents who visit on multiple-entry permit take up one-quarter of mainland visitors to the city.
Legislators should discuss sacked radio host row, Wong says
Legislators are obliged to find out the truth of the sudden sacking of former Commercial Radio phone-in program host, Lee Wai-ling, former civil service minister Joseph Wong wrote. The information technology panel should invite Lee, the radio station’s top management, government officials and the Communications Authority to give their stance and answer questions from lawmakers. It will be a more practical way to follow up the matter than for legislators to issue joint statement to condemn the company for its decision. Lee’s claim that someone “close to Leung Chun-ying” has advised her to “be careful” with her job was probably true. But the person should also advise Leung that it will be extremely difficult to silence young people who are passionate about their jobs.
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