CONSULATE GENERAL OF SWITZERLAND IN HONG KONG
|A condensed press review prepared
the Consulate General of Switzerland in Hong Kong
After a tense spring, the month of June has
witnessed a truce between the feuding HK political factions: everyone
on both sides is now stressing the values of communication, conciliation
and harmony. The question is: does this sudden change reflect political
campaign tactics or a new strategy? Despite the scorching heat a
huge crowd participated in the July 1st pro-democracy march sending
a clear message to the government and Beijing : even if the economy
recovers, Hongkongers want to have a say in the management of their
city. That the economy in fact is recovering is shown not only by
increasing growth rate estimations but also by expectations about
an end to deflation and rising consumer sentiments.
Intimidation methods reminiscent of the Cultural Revolution:
In a Time Magazine interview the highly respected ex-chief secretary
Anson Chan said that HK's residents want good, strong and transparent
governance rather than independence adding that Beijing's handling
of HK's constitutional reform process has hurt and alienated many
because of methods reminiscent of the Cultural Revolution. Beijing
strongly criticised these comments published in a foreign magazine
calling them irresponsible, baseless, unhelpful and not in accordance
Promotion of HK's core values: more than 200 academics and
professionals signed a declaration to protect and promote HK's core
values including liberty, democracy, human rights, rule of law,
fairness, social justice, peace and compassion, integrity and transparency,
plurality, respect for individuals and upholding professionalism.
Launching the "Hong Kong Core Values Declaration", the
campaign's organisers said social harmony and economic success would
be undermined if these values were not defended.
Rare Chinese criticism of Tung: in a rare criticism of the
chief executive, a China Daily article has described him as becoming
ever more elusive and more distant from the public.
Détente between Democrats and Pro-Beijing factions:
after months of open conflict a good number of democrats suddenly
agreed to tone down their combative stance in exchange for better
communication with the central government. It seems that they have
come to the conclusion that confrontation could cost them votes
in the next elections. Even Martin Lee has joined by sponsoring
a LEGCO resolution calling for more harmonious relations between
HK and Beijing. The question remains open whether this change is
a new strategy or just electoral campaign tactics. The democratic
movement is deeply divided on how to confront Beijing as shown by
the ongoing rift concerning the opportunity of the use of the "Return
power to the people" slogan, a phrase that infuriates Beijing.
The chief executive promptly reacted to the democrats' olive branch
by promising them to ask the central government to allow their leaders
to visit the mainland and by joining their efforts to defend HK's
core values. The chief secretary asked the strongly pro-Beijing
tycoons to promote their views through an open political process
and not backroom negotiations because the community is demanding
greater inclusion, transparency and openness in HK's political development
and policy making. The top Chinese representative in HK also praised
the more moderate direction of a part of HK's democrats promising
mainland visit permits to some of the barred democrats. Most commentators
have welcomed "the small breeze of compromise in the air"
noting that intimidation methods are still practised, the latest
incident being the arson against the headquarters of a political
July 1st pro-democracy protest: despite scorching heat and
high humidity between 200'000 (according to the police) and 500'000
(according to the organisers) Hongkongers have participated in the
peaceful pro-democracy march marking the 7th anniversary of the
handover. Most commentators have described it as a success and as
a failure of Beijing's efforts to neutralise the pro-democracy movement.
A HK politician close to Beijing summarised its impact by saying
that in the past Hongkongers only wanted a good life and now they
have shown that they also want to be able to change their future.
US warning: US warned again that relations with China will
suffer unless HK has more democracy and the US Senate passed a resolution
calling for Beijing to let democratic reforms go further in HK.
European concern: in its just released annual report on HK
and Macau the EU has expressed concerns about Beijing's decision
to veto universal suffrage for the SAR in 2007-08 urging HK to make
early progress towards the ultimate aim of full democracy set out
in the Basic law. The current EU commissioner for external relations
and last HK British governor, Christopher Patten, declared that
Beijing should allow the city's people rather more say in shaping
their own affairs.
Human Rights and Legal Affairs
Tiananmen commemoration: on June 4th 80'000 people, nearly
double from last year, attended a candle light vigil to commemorate
Tiananmen massacre. The memorial was also a stage for HK's own struggle
with demonstrators chanting the "Return power to the people"
Request for international monitoring of elections: HK Human
Right Monitor, a local NGO, has asked members of the European Parliament
and Asian Network for Free Elections to monitor the September elections.
Deportation avoided: the judiciary avoided by declaring it
illegal the deportation of a foreigner and her daughter born in
HK receiving praise from the press: The authorities must respect
the rule of law which creates a level of playing field and makes
for a fairer society and brings order to the lives of HK's citizens.
Mainlanders savour island of free speech: Visitors from Guangdong
at June 4th vigil shared first hand the freedoms they do not enjoy.
HK should become the foundation for Chinese people to pursue democracy.
HK tycoons visit China: speaking to the most important HK
tycoons on a visit to the mainland, Vice-President Zeng said that
Beijing will look first to HK and Macau when seeking foreign capital,
talent and technological know how adding that HK's capital accounted
for 44,5% of the FDI in mainland at the end of 2003.
Mainland security agents active in Hong Kong: rumours say
that mainland officials and security agents are secretly being sent
to HK to spy and monitor the situation ahead of July 1 demonstration.
Seven mainland agents have recently been arrested prompting newspapers
to stress that the mainland police must respect HK's borders, and
that for " one country, two systems " to mean anything
law enforcement in HK and the mainland must remain separate from
Impact of Chinese food scandals on imports foods imports
from Guangdong dropped a fifth last month and consumers are replacing
Chinese products by Taiwan, American and European brands.
Mainland Tourism: The solo traveller scheme, already increasing
the number of visitors from the mainland, is planned to be extended
to the mainland's three north-eastern provinces as well as to all
the provinces in the pan-Pearl River Delta region. While the Chief
Executive said more tourist attractions and tourism facilities were
being built to meet the expected demand from mainland visitors,
travel associations expressed concerns that HK's tourism facilities
would be unable to cope with surging arrivals. Increasing brand
awareness among mainland tourists is boosting sales in medium to
high-end consumer goods, especially cosmetics, clothes, electronic
products, watches and gold.
Closer co-operation with Shenzhen: visiting HK the mayor
of Shenzhen declared that one of his top priorities was to develop
and reinforce cross border co-operation issues such as management
of border crossing, monitoring of infectious diseases, cleaning
waterways and co-ordinating infrastructure developments. To avoid
"unhealthy competition" eight agreements were sign to
boost co-operation. The agreements include co-operation in legal
services, trade and investment promotion, economic and trade exchange,
tourism and advanced technology.
Pan-Pearl River Delta Region: At the first Pan-Pearl River
Delta Regional Co-operation and Development forum it was said that
Guangdong would become one of the world's key manufacturing bases
and HK an international services hub focusing on logistics and finance.
At the closing ceremony the Pan-Pearl River Delta Regional Co-operation
Framework Agreement was signed, which covers investment, trade,
transport infrastructure, tourism, agriculture, environmental protection,
technology, education, information sharing and labour services.
Closer Economic Partnership (CEPA): Mainland academics said
many mainland officials were unhappy about the weak response from
HK businesses and professionals in areas such as tourism and the
legal sector to the CEPA. It is believed that the low response was
related to the unfamiliarity with the mainland market.
Signs of economic growth: The agency Standard & Poor
upgraded its long-term outlook on the HK dollar from negative to
stable, which reflects expectations that the recent political development
would not cause instability to the economy. S&P expects an end
to deflation and rising consumer sentiments. The deficit, forecasted
at 6 pc of HK's GDP, was now likely to come in at less then 5pc,
boosting the governments chances of meeting its target of a balanced
budget by 2008-9. Nearly half of HK companies intend to hire more
staff in the next quarter, and people were found to be more optimistic
about the property market. The Bank of China (HK) raised its full-year
economic growth estimate for the city from 5pc to 6.5pc, while the
Federation of HK Industries raised its forecast from between 6.2
and 6.5 to between 7.5 and 8pc. However, some surveys found that
Hongkongers are among the most insecure people in the region, with
widespread anxieties about job security and health issues - 71pc
of respondents expressed concern on both issues.
The Census and Statistics Department's composite consumer price
index for May showed year-on-year deflation had narrowed to just
0.9 per cent, from 1.5pc in April. It was the lowest y-o-y figure
for deflation since July 2001, but economists cautioned against
reading too much into the figures, given the havoc played by the
Sars outbreak last May.
Retail sales in HK grew 19.9pc in April, the fastest year-on-year
pace in more than four years. However, economists and the industry
said that the effect of Sars should be taken into consideration
- and on that basis, the growth is a much less impressive 4.3pc.
The government said there had been a rise in the number of high-spending
mainland tourists and an increase in local consumers' confidence.
Goods and services tax (GST): A 5pc GST could be introduced
in HK as early as March 2008. This is said to be the best time to
introduce a sales tax because the government expected to still be
running an operating deficit, albeit of just HK$5.2 billion, by
then and to introduce it before the Legislative Council elections
in September that year.
Financial centre: HK will remain the top financial centre
in the region for at least the next three years although Shanghai
is catching up fast. This was shown at the 13th Annual Asia Leadership
Forum in HK in April. More than two thirds of the questioned executives
believed Shanghai would not overtake HK in the next three years.
"When it comes to the status of a financial centre, a free
flow of funds is always the prerequisite. This is what Shanghai
and other mainland cities lack" said Andy Kwan, an associate
professor of the department of economics with the Chinese University
Drug patent protection: The Hong Kong Association of the
Pharmaceutical Industry (HKAPI), which comprises large multinational
drug firms, is urging the HK government to bring drug patent protection
in line with international standards, alleging that its poor track
record has essentially eliminated foreign investment in the sector.
Critics say, unless the government is doing something, HK will lose
the chance to be a magnet of foreign investment in healthcare. At
present, the Department of Health requires registrants to show only
that the drugs meet safety, efficacy and quality standards, which
automatically qualifies them for local distribution rights. The
HKAPI suggested the government take guidance from the United States,
where the Food and Drug Administration maintains a master record
of pharmaceutical patents in which drug makers register their products
and check for outstanding patent rights.
Labour Market: Businesses plan to increase their workforces
by 0.7pc on average this year, after staff reductions of 0.3pc last
year and 12pc in 2002. However, economists say they do not expect
the jobless rate to fall below 6pc from currently 7pc in the near
term because of a surplus of low-skilled labour and a lack of skilled
professionals. The last time the unemployment rate was lower with
6.7pc in December 2001. Profound changes in HK's economic structure
mean the natural rate of unemployment had risen from between 2 and
3pc in the late 1980s to between 3.5 and 4.5pc now, according to
the HK Monetary Authority. This increase is attributed to the "profound
structural change" in the economy, with the services sector
taking over from manufacturing as the main source of jobs. Moreover,
HK might not enjoy full employment, even when the economy was booming,
because mainlanders could travel to HK more easily than in the past.
Criminal inquiry in Harborfest scandal: InvestHK boss to
co-operate with criminal Police and ICAC probe of fest fiasco
HK 5th most expensive city: according to Mercer Human Resources
Consulting HK has dropped one place to become the 5th most expensive
city after Tokyo, London, Moscow and Osaka.
Insecurity in HK's parks: two foreign tourists were raped
in a HK park adding to the growing feeling of insecurity of hikers.
Slump in skills of English teachers: the results of the government's
first benchmark language test showed that only 37 per cent of the
teachers passed the listening test, down from 72 per cent a year
ago, while 37 per cent passed the writing test, compared with 44
per cent previously.
Development of the convention trade: not just for tourists,
the city is turning into the Asian destination for meetings by attracting
the convention trade with cheap deals.
Press articles related Switzerland
Wen Wei Po, 04.06.04: Hong Kong won bid to host the Telecom
World 2006. Since its inception in 1971, ITU World has never left
Geneva. The Central People's Government, especially the Ministry
of Information Industry as well as the Ministry of Foreign Affairs,
has given full support to HK in the bid. Chinese Premier Wen wrote
to the ITU for lobbying in October 2003. The HK Government will
spend up to HK$100 million to host the event.
HK Economic Journal, 04.06.04: The legal proceedings against
stock scam charges about a listed company Kwong Hing took place
at Eastern Magistracy yesterday. Four executives including former
UBS analyst Tan Chye-seng will face bribery and fraud charges
South China Morning Post (SCMP), 10.06.04: Investigations
continue to probe the biggest money-laundering case uncovered in
Japan. Hong Kong banker Atsushi Doden working with Credit Suisse
is alleged to have funnelled more than $300 million for Japan's
biggest crime ring, the Yamaguchi-gumi of the yakuza crime syndicate.
Yamaguchi-gumi is the largest of several crime rings which dominate
the Japanese underworld, making their money through gambling, drugs,
the sex trade and loan-sharking.
The money reportedly passed through the HK branch to bank accounts
in Switzerland. Credit Suisse officials said its officials were
co-operating with authorities in Hong Kong, Tokyo and Switzerland,
and had frozen one account linked to the crime syndicate in December.
"Things like this happen," said Martin Somogyi, a spokesman
for Credit Suisse based in Switzerland.
SCMP, 14.06.04: 100 women from the mainland, Hong Kong and
Taiwan will be nominated for next year's Nobel Peace Prize in an
effort to make the institution less male dominated. The names of
1000 women nominated around the world will be sent to Swisspeace,
the Bern based NGO behind the campaign.
The Standard, 17.06.04: LEGCO passed a member's motion urging
the government to promote HK as the " Switzerland of Asia "
and a world-class financial and asset management hub for the mainland.
Secretary for Financial Services and the Treasury Frederick Ma said
even Switzerland did not enjoy the advantage of HK, namely a hinterland
the size of China with such staggering economic growth.
SCMP, 20.06.04: Mention offshore banking and you often think
about the numbered accounts in Switzerland that James Bond patronised
while sipping his shaken Martini." Widely perceived as the
mother of all offshore banking centres, Switzerland is famed for
its banking secrecy rules. The Swiss Constitution clearly defines
and protects Swiss banking secrecy rules and any Swiss banker revealing
information about clients will be prosecuted under Swiss Law. It
creates an atmosphere of high confidentiality. However, regarding
criminal cases, the Secrecy is not meant to protect the wrong people.
Due to the fact that the European Union is looking to increase tax
rates concerning offshore banking centres, many observers question
the Swiss offshore banking future. While some people will take their
money back to their home country, some will leave it in Switzerland
and others might look at Asia as an offshore banking region, whereas
HK and Singapore were often favourite destinations for European
SCMP, 21.06.04: The West Kowloon cultural district project
is not only a battleground for property developers, it is also a
competition between the world's top architects and engineers. Architects
Herzog & de Meuron, which designed London Tate Modern gallery
and is engaged on the Beijing Olympic Stadium, has been hired to
design the performance venue and the museum of modern art.
This is a review of the Hong Kong media and does
not necessarly represent the opinion of the Consulate General
of Switzerland. The Consulate General of Switzerland in
Hong Kong does not bear any responsibility for the topicality,
correctness, completeness or quality of the information
provided. Liability claims regarding damage caused by the
use of any information provided, including any kind of information
which might be incomplete or incorrect, will therefore be
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