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June 30, 2007
The European aircraft maker Airbus said on Thursday it planned to deliver 300 A320 planes from an assembly line in north China's port city Tianjin by 2016 to satisfy the demand in the country. The assembly plant is a joint venture between Airbus and Tianjin Zhongtian Aviation Industry Investment Co., a Chinese alliance of China Aviation Industry Corp I, China Aviation Industry Corp II and Tianjin Bonded Zone Investment Co.
China says it will further modernize traditional Chinese medicine (TCM) in the next 20 years to improve its appeal at home and overseas as an effective alternative to Western medicine. In modernizing TCM, efforts will be made to improve standards, study new applications and standardize planting, production and processing of medicinal herbs, according to the report of the China National Center for Biotechnology Development. The government will also work to form a healthcare system where TCM and western medicine complement each other and build TCM into an industry with an annual output value of 400 billion yuan (US$52.6 billion), according to the center, which is under the Ministry of Science and Technology. "China will work to make sure that a TCM-based health system serves as an important pillar to people's health, and a healthcare service is established through which 85 percent of the country's rural population have access to TCM," said the report, released at an international conference on bio-economy. Currently, about 3,000 hospitals in China provide TCM treatments, with patient visits amounting to nearly 234 million each year. Beijing poised to launch US$200b global fund - Mainland seeks better returns for US$1.2 trillion reserves. Beijing has moved a step closer to launching its huge state investment company, detailing plans for a US$200 billion reserve fund that could bankroll the nation's efforts to become a key force in international financial markets. The Ministry of Finance yesterday formally submitted a proposal for the bond issue to the National People's Congress, signalling the authorities want better returns for the country's US$1.2 trillion in foreign exchange reserves and at the same time raise "China Inc's" profile. While Beijing is increasingly moving to bring its rising economic power to bear on global markets, it is also trying to tame a flood of liquidity and runaway growth that has sent domestic stock markets soaring. The top legislature is today expected to endorse a bill that would scrap or reduce tax on interest income from personal bank savings to deter funds flowing into the equity markets. To fund the new investment company, the finance ministry will issue 1.55 trillion yuan of tradable special treasury bonds to buy US$200 billion of foreign reserves. The bonds would have a 10-year term or longer. June 29, 2007
Lan Kwai Fong tops HK nightlife - As the World City of Asia, Hong Kong is known for its vibrant 24-hour lifestyle. And when the sun goes down, Lan Kwai Fong is the place to party, with its collection of bars, pubs, and restaurants. Lan Kwai Fong, Hong Kong's trendiest nightlife street. And it's probably the most westernized place in town, drawing thousands of tourists, expatriates, and locals every day. Lan Kwai Fong is a Hong Kong icon. It's a place where people of different cultures can meet, and find good food and drinks and late night fun. As the saying goes, if you work hard, you've got to play hard. And Lan Kwai Fong is just the right place to do it. Dutch tourist, said, "People here are friendly, open, welcoming. I feel like home." Australian tourist, said, "It's quite a bazaar with everybody outside drinking, dancing, standing." Many bar owners and customers here are foreign nationals. And no matter where they come from, Lan Kwai Fong has become part of their life. Mr. Fox came to Hong Kong over 20 years ago from California in the United States. At Lan Kwai Fong, he found a place that reminds him of home -- the California Restaurant. For the past 20 years, he's sat in this seat almost every day. Customer, Lan Kwai Fong, said, "I came here every…my second family…second child" 27 years ago, a young Canadian, Allan Zeman, opened the first restaurant in Lan Kwai Fong. It was he who later transformed the area into a dazzling bar street. And his name is now linked to many other Hong Kong successes besides the world-renowned entertainment zone. Allan Zeman said, "If the walls can tell the story, …so many different events happening in Lan Kwai Fong…became the meeting place where from all the world….They really made me the father of Lan Kwai Fong." Now Allan Zeman owns 17 restaurants in Lan Kwai Fong. After Hong Kong's return in 1997, he brought Lan Kwai Fong to Shanghai. And Zeman says his next stop will be China's capital city, Beijing.
Hong Kong by day shines just as brightly. The city has a well-deserved reputation as a dining and shopping paradise. It serves up some of the best Chinese cuisine in the world, and the shops have visitors from all over opening their wallets. Dining is certainly one of the highlights of Hong Kong. Outstanding Chinese cuisine can be easily found here, like roast goose. Traditional cooking methods are well preserved, as well as authentic flavors. The momentum of the Hong Kong economy in recent years has ensured the local catering industry handsome profits. Kan Kun-Sing, owner Yung Kee restaurant, said, "Our business in the past decade was much better than before because Hong Kong remains a financial center and the economy is pretty good. Besides, more tourists are coming from the mainland and that has been really good for business." Dim Sum is another Hong Kong specialty. Steamed prawn dumplings, sponge cake and pork dumplings are just a few of the delicious mouthfuls. Western cuisine also has a place on Hong Kong tables. The huge flow of people and the wealth they bring have attracted many of the world's finest chefs and restaurants. Kevin NG, asst. general manager Sir Hudson, Italian restaurant, said, "We have seen great potential at present and also in the future for Italian food in Hong Kong. There are many factors, like people in Hong Kong, they are very willing to try new style, new design, also the spending power is extremely high." Equally amazing are the city's shopping options. From department stores and shopping malls to small boutiques and bargain stalls, there's something for everyone. Hong Kong's position of an international free trade hub enables the city to provide global shoppers the most diversified, quality merchandise at competitive prices. And it's not just the ladies who go on spending sprees. Australian shopper, said, "I have been here for two weeks and I have been shopping everyday and I can spend a year shopping, I think. (Q: How much have you spent?) Probably, some 6,000 US dollars. (Q: What did you buy?) Clothes, shoes, gifts for wife and everything." A pleasant shopping experience helps bring customers back again and again. According to the Hong Kong SAR government, the total revenue in the retail sector reached nearly 21 billion Hong Kong dollars in 2006, just over a fifth of the total of the entire tourism industry. Hong Kong remains one of the top destinations for dining and shopping in the world, but one thing has changed--the main driving force behind the growth. Last year, the Chinese mainland accounted for more than half of the visitors to Hong Kong. And they have tremendous purchasing power. This shows a close economic connection with the mainland is vital for Hong Kong's business prosperity. China Mobile, the country's biggest mobile-telephone operator, yesterday surpassed HSBC Holdings to become Hong Kong's largest company by market capitalization as investors bet the red chip will launch a mainland listing as soon as August. The top spot, reached only days before the 10th anniversary of Hong Kong's handover, underscores the ascendancy of mainland companies in the city as well as investor demand for shares likely to benefit from a surge in the nation's stock market. China Mobile rose 0.65 per cent to close at a new high of HK$84.80, bringing its market capitalization to HK$1.7 trillion. HSBC fell 0.07 per cent to HK$144.10, lowering its market capitalization to HK$1.69 trillion.
June 28, 2007
China Development Bank (CDB) announced Tuesday that it will issue five billion yuan (US$657 million) RMB bond in Hong Kong, and this is the first Chinese currency bond to be launched outside the Chinese mainland. The two-year bond, which will be synchronously sold to institutions and individual investors from June 27 to July 6, yields three percent annually. The return is relatively high compared to the 0.7 percent interest rate for six-month deposit here, with the anticipation of RMB appreciation. The minimum subscription for an individual investor is 20,000 yuan, and at least one billion yuan of the bond is targeting at retail investors. The joint lead managers and bookrunners for the bond issue are Bank of China (Hong Kong) and The Hong Kong and Shanghai Banking Corporation Limited. The distributors comprise of 14 placing banks with branches in Hong Kong, including Bank of Communications, China Construction Bank (Asia), Dah Sing Bank, and The Bank of East Asia. The bond did not apply for independent ratings. CDB Governor Chen Yuan explained that despite the bank's on-going market- oriented reform, CDB will adhere to its mission of helping to achieve the government's goals, and "our debt rating will also remain intact." CDB is China's largest policy bank and solely owned by the Ministry of Finance. It has been raising capital by issuing bonds since 1998, and has been given sovereign ratings by Moody's, Standard and Poor's and Fitch Ratings. Analysts say both Hong Kong and the mainland could benefit from floating RMB outside the mainland. "The issuance of RMB bonds here will strengthen Hong Kong's status as an international financial center," Ma Delun, assistant governor of the People's Bank of China, said at the launch ceremony of the bond. The issuance of renminbi bonds in Hong Kong signifies the city' s role as the country's premier international finance center, giving local investors more choice, said Henry Tang, financial secretary of the Hong Kong Special Administrative Region government, when addressing the ceremony. "The arrangement is a fresh step in Hong Kong-Mainland co- operation," he said.
Hong Kong will be the main beneficiary when the Hong Kong-Zhuhai-Macau Bridge is up and running, a senior official of the mainland's top planning body said yesterday. National Development and Reform Commission deputy chairman Zhang Xiaoqiang said a mainland study showed Hong Kong would enjoy 64 per cent of the economic benefit brought by the long-awaited bridge. But an academic who has studied the issue said his conclusions were exactly the opposite and the Pearl River Delta cities of Zhuhai , Zhongshan and Jiangmen would be the big winners. The 29km bridge is still at the planning stage despite a decade of negotiations. Mr Zhang said the mainland study, which projected the economic gain brought by an expected increase in cross-border traffic, also estimated that Guangdong would secure 26 per cent of the benefits and Macau 10 per cent. "The bridge will be effective in helping Hong Kong expand its hinterland," he said. But Mr Zhang said this did not necessarily mean Hong Kong should invest more in the bridge's construction because it would be up to companies interested in the project to negotiate a stake. "Under the principle of attracting more private investment, it will be up to the companies to decide who will contribute more," he said, adding that the governments would be responsible for financing checkpoints and links. Mr Zhang is also head of a special taskforce set up by the State Council late last year after the plan became bogged down by disputes over issues such as the location of checkpoints and the sharing of the construction costs, estimated at US$3.7 billion. He said some consensus had been achieved after several meetings between representatives from the three governments, but there was still no timetable.
HSBC Holdings (0005) group chairman Stephen Green said Monday the lender's US subprime mortgage division will not be affected by last week's news that Bear Stearns, one of the largest global investment banks, will have to bail out two of its hedge funds that had bet heavily on subprime mortgage assets. A HK$3 billion bid from Wheelock Properties (0049) has triggered an auction for a Wong Tai Sin residential site, where analysts believe developers could face potential uncertainty over the plot ratio. Shares of refiner China Petroleum & Chemical Corp (0386), better known as Sinopec, tumbled Monday as investors rattled by the news of chairman Chen Tonghai's resignation dumped the stock. Standard Chartered (2888), the British bank that makes most of its money in Asia, said it will introduce private banking services in eight to 10 more mainland cities by 2010 as the number of wealthy people soars. RREEF, the property investment arm of Deutsche Bank and manager of the recently listed RREEF China Commercial Trust REIT (0625), is teaming up with a private equity firm to build more than 25 hotels in the mainland under the Hilton Garden Inn brand in a US$550 million (HK$4.29 billion) deal.
HSBC Holdings, the European bank, said it would buy part of an office tower in Shanghai to house its China headquarters as it speeds up expansion in China. HSBC agreed to buy naming rights and occupy 20 floors of one of the twin towers of the Shanghai International Finance Center, to be completed by 2010, from Sun Hung Kai Properties, HSBC said in a statement to the Hong Kong Stock Exchange. The tower, a few blocks from the bank¡¯s current headquarters, would be renamed HSBC Building-Shanghai IFC. Stephen K. Green, the chairman of HSBC, disclosed the deal at a news conference in Shanghai, but he declined to say how much the bank had agreed to pay.
Shares in China COSCO Holdings more than doubled in its Shanghai IPO on Tuesday, after attracting a record $214 billion in subscriptions. Thailand, Southeast Asia's second- biggest economy, plans to buy electricity from China for the first time starting in 2017 because the country is not building its own plants fast enough to meet an expected surge in demand. June 27, 2007
CEPA opens door to mainland securities brokers, fund houses - China securities brokerage firms and fund houses will be able to apply to set up in Hong Kong under the latest round of the Closer Economic Partnership Arrangement (CEPA), to be signed in the next few days before the 10th anniversary of the handover on July 1, according to sources. The agreement is also likely to allow local securities brokers to apply to set up across the border, although only a few big players will be qualified under the mainland's high capital requirements. Allowing mainland brokerages and fund houses to apply to the Securities and Futures Commission for Hong Kong trading licences will help mop up some of the excess liquidity in the mainland markets, said one source. At present, a number of mainland-owned securities firms are incorporated in Hong Kong but they deal mainly with Hong Kong investors. The new CEPA deal will allow mainland incorporated brokerages and fund houses to set up wholly owned subsidiaries or joint ventures in Hong Kong to serve their mainland clients. It is a timely move following last week's announcement by the China Securities Regulatory Commission allowing mainland mutual funds and securities houses to invest in overseas stock markets through the qualified domestic institutional investor scheme from July 5. The initial public offering scene is set to heat up again this week with two eye- catching listing candidates, New World Department Store and Shanghai Fosun Group, aiming to raise a total of more than HK$13 billion. Hang Seng Bank (0011) will pay HK$2.4 billion to parent HSBC (0005) to acquire the 50 percent of Hang Seng Life it does not already own.
The Electronic Disclosure Project is to be introduced by Hong Kong Exchanges and Clearing today. Under this project, listed companies are only required to release their financial information to the HKEx electronically, as opposed to the previous requirement under which companies were mandated to publish their results in newspapers. All 15 incumbent non-official members of the Executive Council, along with outgoing Chief Secretary for Administration Rafael Hui Si-yan, will remain in the chief executive's top advisory team. Hong Kong Jockey Club chairman John Chan Cho-chak warned Sunday the club's long-standing role as a community donor cannot be taken for granted in the years to come in the face of growing challenges from other forms of leisure and entertainment. The Hong Kong people's satisfaction with the territory's overall development since the handover has reached a record high of nearly 40 percent as the economy continues to improve, according to the latest survey conducted by the Chinese University of Hong Kong's Institute of Asia Pacific Studies. Asia Pacific still key for HSBC, says incoming chief Flockhart - HSBC Holdings (SEHK: 0005) intends to make up to 50 per cent its profit from the Asia Pacific over the next decade, countering claims the bank is moving away from the region. Sandy Flockhart, the new chief executive of HSBC's Asia-Pacific unit who replaced Michael Smith, said the bank would continue to invest in the region, including in the mainland, India, Indonesia, South Korea and Taiwan. The resignation of Mr Smith was described by Goldman Sachs as evidence of tension within HSBC as it arguably expanded away from Asia. The group made 39.5 per cent of its profit from the region last year. Europe accounted for 31.5 per cent, North America 21.1 per cent and Latin America 7.9 per cent. Mr Flockhart said Asia remained important for the bank because of the tremendous growth potential. "We'll continue to invest in Asia as it's part of our DNA," he added. He said the bank would continue to grow "organically" and would expand through acquisitions if opportunities arose. The bank said earlier that it had invested more than US$2 billion in the region in the past three years as well as putting US$3.4 billion into associated companies. Mr Flockhart did not say whether a similar amount or more could be invested in Asia in the next three years. "If there are plans that show value to us, we'll invest [in them]," he said. HSBC's senior management, including group chairman Stephen Green, have said that they expect the Asia-Pacific region to account for 45 to 50 per cent of earnings over the next decade. Mr Flockhart said he would try to achieve that target and would prefer to "do it earlier rather than later". A source said HSBC had appointed Mr Flockhart, described as an emerging markets specialist, to reassure investors about its Asian operations after the departure of Mr Smith, who is taking up a position as chief executive of Australia & New Zealand Banking Group. Mr Flockhart admitted that finding good talent in Asia would be a challenge as lenders sought growth in the region. Mr Flockhart was president of HSBC's Latin American unit but previously served 12 years in Hong Kong.
Construction will begin Thursday on an inter-city subway linking two cities in south China's Guangdong Province,heralding faster rail services in the Pearl River Delta area, one of the country's economic engines. The 32.16-km-long subway line linking Guangzhou, capital of Guangdong, with Foshan City, west of Guangzhou, will shorten travel time between Foshan city and downtown Guangzhou to about 40 minutes, down from 50 minutes. At an estimated cost of 14.7 billion yuan (1.9 billion U.S. dollars), the subway has 21 stops and will go into operation in 2012. The line will be linked to four subway lines in Guangzhou. The inter-city subway is one element of a planned fast rail service network along the Pearl River Delta area, adjacent to Hong Kong and Macao. The network will have seven inter-city rail lines with a total length of 588 kilometers, connecting Guangzhou with Dongguan, Shenzhen, Zhuhai, Zhaoqing and Foshan. Four of them have been completed and all the lines will be completed by 2020.
Mandatory national security checks on foreign companies' acquisition of domestic players have been included to the draft anti-monopoly law submitted yesterday to the top legislature for a second reading. "Foreign mergers and acquisitions (M&As) of domestic companies or foreign capital invested in domestic companies in other forms should be examined if the cases are related to national security," said the draft submitted to the 28th session of the Standing Committee of the National People's Congress (NPC). There is already a national-security check framework in place for foreign M&As, but it has been included in draft legislation for the first time. According to a regulation jointly issued by six government agencies late last year, foreign investors have to apply for approvals from the Ministry of Commerce when their purchases of domestic companies affect national economic security, are in key sectors or lead to the transfer of operating rights of famous domestic brands. The legislative move reflects the government's efforts at clarifying the legal framework for foreign M&As, said Meng Jianbing, an expert with Seafront Law Office in Beijing, adding that lawmakers are learning from other countries such as the United States on how to protect national security. The requirement was added to the long-awaited anti-monopoly law against the backdrop of a fast-rising number of foreign M&As as well as foreign companies acquiring major State-owned enterprises or companies with famous brands. One case which has drawn widespread attention is US private equity firm Carlyle Group's attempted takeover of Xugong Construction Machinery, which did not pass regulatory hurdles following fears that China is selling strategic companies to foreign investors. According to official statistics, foreign M&As accounted for 5 percent of all forms of foreign direct investment annually up to 2004 but increased dramatically to 11 percent in 2004 and nearly 20 percent in 2005. Zhang Yansheng, director of the International Economic Research Institute affiliated to the National Development and Reform Commission, said it is crucial that foreign purchases of domestic firms go through security as well as anti-monopoly checks. But "the situation needs to be spelt out in more detail. For example, what kind of merger cases are related to national security"? The draft anti-monopoly law, which aims to provide for fair competition, was submitted for first review in June 2006.
Chna property giant Hopson Development Holdings (0754) will shell out HK$6 billion to buy a Beijing project owned by chairman Chu Mang-yee.
June 26, 2007
A Memorandum of Understanding (MOU) aimed at strengthening co-operation and exchanges in health and medical areas between the Chinese mainland and the Hong Kong Special Administrative Region (HKSAR) was signed Friday. The MOU was signed by visiting Chinese Minister of Health Gao Qiang and Secretary for Health, Welfare and Food of the HKSAR government York Chow. Under the MOU, the two sides agreed to foster co-operation in various areas including strengthening the flow of health and medical information as well as the notification and contingency co- operation system on infectious disease outbreaks and public health emergencies. In addition, the two sides would encourage medical and health professional groups and relevant institutions in the mainland and Hong Kong to share experience through seminars and training programs. Speaking at the signing ceremony, Chow said that close co- operation between the health authorities of the mainland and Hong Kong was vital in meeting the numerous new challenges in public health. "The signing of the MOU today marks a major milestone in public health development and medical co-operation between the Ministry of Health and the Health, Welfare and Food Bureau of the HKSAR government," he said. The central government will announce Hong Kong's new team of principal officials for the next term Saturday morning through the official Xinhua News Agency before Chief Executive Donald Tsang Yam-kuen and his 15 ministers meet the media to outline governance plans for the next five years.
Beijing twice considered taking back Hong Kong by force in the decades running up to the handover, according to a retired mainland official formerly in charge of Hong Kong affairs. In 1967, Huang Yongsheng , the then commander of the Guangzhou military region, had suggested a military invasion to quell rioting in the city, Lu Ping said in an interview with mainland satellite broadcaster Dragon TV that aired yesterday. "When premier Zhou Enlai learned of it, he gave an instruction late in the evening against [the PLA] proceeding," Mr Lu said. The second occasion on which the possibility had come up was during the visit of the then British prime minister, Margaret Thatcher, to Beijing in 1982. Late paramount leader Deng Xiaoping told her that mainland authorities would rethink the timing and means of restoring Chinese sovereignty over Hong Kong if there was major unrest once the July 1, 1997, handover was announced, Mr Lu recalled. "The [new] `method' referred to was its requisition by force," said the former director of the State Council's Hong Kong and Macau Affairs Office. Mr Lu's interview was part of a Dragon TV series to mark the 10th anniversary of the handover. The retired official is best remembered in the city for his trenchant criticism of its last governor, Lord Patten, whom he once called a "sinner for a thousand years" for trying to foster greater democracy in Hong Kong. Mr Lu is not the only former senior mainland official to have offered insights in the lead-up to the handover anniversary into what went on behind the scenes in the diplomatic battles between London and Beijing. Pro-Beijing newspaper Wen Wei Po published excerpts of a forthcoming book of memoirs by Zhou Nan , Xinhua's former Hong Kong director, in which he was quoted as saying Beijing had considered using "non-peaceful means" to get back Hong Kong when considering its reunification.
New York-listed units in Blackstone Group jumped 21 percent in the first few hours after their debut, giving the mainland's state investment agency US$789.94 million (HK$6.16 billion) in gains on the US$3 billion stake it bought in the private-equity behemoth as China seeks to diversify its foreign reserve holdings and improve returns. More than 1,000 public hospital doctors are expected to stage a sit-in at the Queen Elizabeth Hospital Saturday to fight for better pay and working hours. They are also calling on the Hospital Authority to restore the wage scales of new recruits to the levels they were eight years ago and for a pay rise similar to the 4.96 percent proposed for civil servants. Authority chairman Anthony Wu Ting-yuk, while calling on the doctors to be patient during the negotiations, assured the public services at hospitals would not be affected. Hong Kong Public Doctors' Association's president Paul Shea Tat-ming said previous salary cuts had affected morale and, subsequently, the quality of medical services. "Doctors used to be the creme de la creme of society, but now they don't even rank alongside professionals in the civil service," Shea said, adding: "We want to be paid a salary comparable to a professional in the civil service."
Chinese Vice Premier Zeng Peiyan on Friday warned people against cheating in the second national land survey that is to be launched on July 1st. Every organization and individual should provide or gather accurate land data, and the central government will tolerate no cheating or changing data, Zeng said during a teleconference in Beijing. He told ministries and local governments that up-to-date and accurate land data will help the government make tough land control measures and promote sound and rapid economic growth and social development. China conducted the first national land survey between 1984 and 1996. Given the huge changes that have taken place in urban and rural areas, the data are now out of date, the vice premier said. The primary task of the survey is to obtain information on the acreage, quality and distribution of the arable and basic farmland in the country, he told the meeting. This will help ensure no decline in the 1.8 billion mu (120 million hectares) of arable land, including the 1.6 million mu of basic farmland that is widely seen as critical to the country's food security, he noted. Local authorities should finish the survey before the end of June 2009 and report the new land data to the Ministry of Land and Resources on Oct. 31, 2009, said a circular issued by the State Council on Thursday. The circular said China will use advanced remote imaging technologies to survey land used for different functions including farmland, forests, land used by industry and infrastructure and development parks. Acreages and their distributions will be mapped and recorded nationwide. China will build an electronic database for all the survey findings and devise statistical and monitoring methods to track changes in land resources, and also set up a system to update the information quickly, said the circular. The survey will help the government ensure national food security and better protect farmers' interests and thereby bolster social stability, the circular stated.
China has 80m middle class members - The number of Chinese officially described as "middle class" has risen by almost 15 million people in the last two years to 80 million in total, according to official sources. About 6.15 percent of the population were middle class, and the number was still rising, Hou Yunchun, director of the Research Office of the State Council, told a conference on wealth management, the Shanghai Securities News reported recently. Hou's estimate was based on the criterion of the National Bureau of Statistics (NBS), which defined middle-income households as having an annual income between 60,000 and 500,000 yuan (7,792 and 65,790 U.S. dollars). A study by the NBS in January 2005 showed about 5.04 percent of Chinese, or 65.5 million people, fell into this category. By January 2007, China still had 23.65 million people below the government poverty line, earning less than 85 U.S. dollars a year. The figure had fallen by more than 100 million since the government launched its campaign against rural poverty in 1986. The expanding middle class indicated China was entering "a sound cycle of development", said Shi Jianping, president of Beijing-based Central University of Finance and Economics. As personal wealth increases, Chinese commercial institutions are improving their wealth management services to customers with different needs, said Shi. A market survey from the Bank of China shows the Chinese private banking market is growing at an annual rate of 12 percent. Telecom equipment maker Huawei Technologies has won a $700 million contract for China Mobile Communications Corp.
Financial service provider and mainland property investor First Shanghai Investment (0227) said the China Securities Regulatory Commission's announcement allowing mutual funds and securities houses to invest in overseas stock markets via the QDII scheme has spurred significant interest from investors. Widespread fraud is hampering the development of China's public pensions system, which is ill adapted to meet the needs of a huge population that will soon be aging rapidly, according to a new Organization for Economic Cooperation and Development report. The mainland's secretive military industries will be opened up to private investors - both domestic and foreign - as part of modernisation efforts by Beijing. Weapons makers would be allowed to raise money through initial public offerings at home and abroad, the Commission of Science, Technology and Industry for National Defence said yesterday. A few "key military enterprises with national strategic security concerns" would remain solely in state hands, the commission said. But it did not identify any specific enterprises or define exactly what strategic security concerns were involved. Mainland officials have dropped hints in the past few years that they would open up the ordnance industry to foreign and private investment. But yesterday's announcement and release of guidelines for the move was the first official confirmation and the first time details have been given of the extent of foreign and private investment. The government has set an ambitious target for reform of the military firms, with the guidelines saying the reform of the "qualified" weapon makers should be completed in the "next few years". The guidelines say companies engaged in the design, assembly and manufacture of weapons systems will be eligible for investment from both domestic and foreign companies and funds. The degree of openness to private capital would depend on the importance of the weapons systems a company produced, the commission's announcement said, without elaborating. The move aimed to modernise the shareholding of the companies that make the mainland's military hardware as well as upgrade the defence industries' capabilities and technology, the statement said. The commission is responsible for developing policies for defence-related industries and implementing the restructuring of military industrial enterprises and institutions. It is headed by Zhang Yunchuan, a member of the Communist Party Central Committee. In a strong indication of Beijing's intention to build up its own military conglomerates, the document said the government would also encourage the military industrial firms to undertake cross-shareholdings. Both the State-owned Assets Supervision and Administration Commission, which oversees the reform of state-owned companies, and the National Development and Reform Commission, which oversees the mainland's economic development, would contribute to the reform programme, the statement said. Although the scope and size of mainland's military industry has remained unclear, the central government has tried to reduce it over the past 20 years by forcing many underproducing firms to make goods for civilian use. The China Weapon Industries Group Corporation, the mainland's largest weapons-manufacturing group, owns 140 companies involved in research, distribution and manufacturing. By the end of last year, the corporation had total assets close to 140 billion yuan and revenue from its core business exceeded 100 billion yuan, according to its website. The corporation, formerly known as the China North Industries Group Corporation, makes amphibious assault equipment, anti-aircraft missiles and night vision equipment for the army, navy, and air force. One of its units, Mongolia First Machinery Group Corporation, is a tank manufacturer with total assets of 4.65 billion yuan. The China Weapons Equipment Group Corporation owns more than 50 companies that make both military equipment and civil vehicles including motorcycles and cars. The company's total assets and revenue both exceed 100 billion yuan. Beijing has officially budgeted US$45 billion for defence spending this year, but many experts believe real spending will be higher. June 25, 2007
The government of the Macao Special Administrative Region has collected 11.24 billion patacas (1.4 billion U.S. dollars) in direct gaming taxes in the first five months of this year, seeing a remarkable year-on-year rise of 45.4 percent. The statistics issued Friday by the Finance Services Bureau ( FSB) showed that the gaming taxes accounted for 73.9 percent of the government total revenue in the period. Macao's 26 casinos pay 35 percent of their gross receipts as direct tax to the government. The region, with a population of 508,000, has a 150-year history of gaming industry and is the only part of China where casino gaming is legitimate.
Hong Kong's gross domestic product (GDP) rose 5.6 percent in real terms in the first quarter this year over the same period last year, compared with the 7.3 percent growth in the previous quarter, official figures released Friday indicated. Analyzed by sector and on a year-on-year comparison, net output in all service sectors taken together rose 7.6 percent in real terms, after 9.6 percent growth a quarter earlier, said the Census and Statistics Department of the Hong Kong Special Administrative Region government. Net output in the wholesale, retail and import and export trades, restaurants and hotels grew 7.7 percent in real terms, compared with the 10 percent rise in the previous quarter. Growth in local consumer demand, robust external trade and the expansion of offshore trade and inbound tourism all contributed to the rise, said the department. The financing, insurance, real estate and business services sector's net output rose 15.2 percent in real terms compared with the 17.4 percent increase in the fourth quarter. The growth impetus came mainly from banking services, on the back of a substantial rise in commission and service income. Also relevant was a leap in net output of the stock brokerage companies, underpinned by a significant rise in stock market turnover, said the department. The bullish stock market has brought a bonanza not only for investors, but also for Hong Kong's 2.3 million employees, as the net average return from equity investment under the Mandatory Provident Fund has surged to a record 8 percent this year, compared with 6.99 percent |
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Voice Over IP
Hong Kong: 
Chinese president Hu Jintao
Wednesday visits an exhibition in Beijing on Hong Kong's achievements in the
decade since its return. Hong Kong has remained as before a magnet since it
returned to China 10 years ago, and it will surely witness a "more splendid"
future in the embrace of the motherland, Chinese President Hu Jintao said
Wednesday.
Fashion retailer
Esprit Holdings Ltd, the best- performing stock in Hong Kong's benchmark index
in the past five years, plans to spend $1 billion to acquire an international
luxury brand by next year to boost sales of high-margin clothing. "I would like
to integrate such a brand as a better sister of Esprit and as a role model to
access good designers who normally wouldn't want to work for Esprit," Chief
Executive Officer Heinz Krogner said in Hong Kong. "It doesn't need to be a huge
company and it should not dilute earnings. We aim to buy knowledge of the luxury
segment, not revenue." A luxury brand may boost Hong Kong-based Esprit in
Europe, where it earns most of its revenue selling mass-market products such as
jeans for about 70 euros ($94) and T-shirts for 20 euros. Esprit sells clothes
in more than 40 nations and aims to open a new store, including franchised
outlets, every day in the year from July. "Buying a luxury brand makes sense
because Esprit wants to position itself in Germany at the higher end," said
Erica Poon Werkun, a Hong Kong-based analyst at UBS AG. "Although Esprit targets
the mass market, its products are more expensive than those of its competitors.'
Kroger has previously expressed interest in Donna Karan International Inc. LVMH
Moet Hennessy Louis Vuitton SA, the world's biggest luxury-goods company, bought
Donna Karan in 2001 for $243 million. Esprit's profit in the six months ended
Dec. 31 surged 28 percent to HK$2.4 billion ($307 million) on 25 percent more
sales from Europe. Of the Hang Seng Index's current 39 constituents, Esprit is
the best performing in the past 10 years. Since joining the benchmark in
December 2002, the company's shares have surged 1,660 percent. 
China:
Beijing's
Silk Market (or Xiushui Street) recently expended almost 3 million Yuan (400,000
US dollars) from the "intellectual property rights (IPR) protection fund" to
dissuade 90 shops which may easily take part in infringement acts. This is to
ensure the quality of the top-notch specialized silk area. Picture displays an
old-fashioned brand shop in the Silk Market.
A boy selects online game
software. China's online game market is seen growing 35% to hit $1.3 billion
this year amid strong growth in Internet users, launches of high-quality games
and yuan appreciation.
One of the thrills for visitors to Hong
Kong is one of its most popular sports--horse racing. Why does the sport hold
such a special place in the hearts of local residents? And how has horse racing
retained its characteristics over the many years? For over a century, horse
racing has thrilled Hong Kong people, providing first-class entertainment to a
highly enthusiastic public. Here at the Sha Tin race course, jockeys from
different countries are making the final preparations. With a seating capacity
of up to 85,000, Sha Tin is always packed during the race season. Mao Xuzhi, Sha
Tin racecourse, HK, said, "Gambling is illegal here in Hong Kong, except for
lotteries and horse racing. Their horse comes in first." This old punter, Mr.
Huo, has been betting on horses for over 3 decades. Like all his fellow punters
here, he enjoys studying the traits and performance of the horses. Mr. Huo says
he loves to watch the jockeys in action. Another horse racing fan, Mr. Lee, says
the sport has become a symbol of Hong Kong. That explains in part why
horse-racing has been a big industry for the past 150 years. Winfried
Engelbrecht-Bresges, CEO, the HK Jockey club, said, "Horse racing in Hong Kong
is a life style. People of HK are very competitive. They like things fast. They
like to be risky. Deng Xiaoping said horse-racing and dancing continue in HK.
This is definitely the way what has continued here." Behind these gambling-mad
crowds and the world-class horses and jockeys is the controller of all Hong Kong
horse racing, the Jockey Club. It's also the city's biggest tax payer and
charity donor. It gives about 1 billion Hong Kong dollars each year to
charitable causes. Thanks to the central government's commitment and support
after Hong Kong's return, the Jockey Club is still a winner after 10 years. And
it's convinced that Hong Kong's special system will provide a solid guarantee
for the future of the racing industry. 
The first issuance of China's yuan-
denominated bonds in Hong Kong by China Development Bank will be available for
retail subscription starting today with the minimum investment set at HK$20,000.
As the coupon of the bonds is set at 3 percent - much higher than the typical
0.8 percent rate offered by local banks on yuan deposits - the response is
expected to be robust. The retail order book will be closed on July 6. Hong Kong
Monetary Authority chief executive Joseph Yam Chi-kwong said after the launch
ceremony Tuesday that the second issuance of yuan bonds may come soon. "The
management arrangement for issuing yuan bonds in Hong Kong by mainland financial
institutions is already in place. There is actually nothing to stop them from
coming," Yam told reporters. The Export-Import Bank of China, a fully
government-owned policy bank under the direct leadership of the State Council,
is believed to be the second mainland financial institution preparing to issue
yuan bonds in Hong Kong. The bank said earlier its board had approved the
issuance, and will proceed with the sale here after obtaining approval from the
People's Bank of China. 
A
self-controlled train moves for a test run as it makes its debut at the Beijing
Capital Airport in Beijing, June 26, 2007. The passenger train will be running
between terminals of the airport after the third terminal is put to use before
the Olympic Games.
China's Yan Zi gestures
during her singles match against Italy's Tathiana Garbin at the Wimbledon tennis
championships in London June 27, 2007.
Theme song for Chow's
"Secret" debuts earlier than film - Taiwan pop king Jay Chow (L) promotes his
directorial debut "Secret Cannot Be Told" with his lead actress Guey Lun-mei.
Although the post-production work on pop king Jay Chow's directorial debut,
"Secret", is yet to be finished, the themed song of the film has been scheduled
for release in Asia on Thursday. The Beijing News reported on Wednesday. Chow's
long-time partner Vincent Fang took charge of the lyrics for the song, which has
been described by Chow as "a shining point" of the film. According to Chow, this
time he tried to emulate Britpop in composing the song - quite a different
approach from his other film music hits, such as "Ju Hua Tai", the theme song of
"Curse of Golden Flower" and another song he made for Jet Li's kungfu film "Huo
Yuan Jia".
Hollywood legend
Robert DeNiro, seen here in 2006, is the co-founder of the Tribeca film festival
which is heading to China despite strict movie censorship in the communist
nation. The Tribeca film festival, co-founded by Hollywood legend Robert DeNiro,
is heading to China next month despite strict movie censorship in the communist
nation. The festival, which was set up in New York in 2002 as a response to the
previous year's September 11 World Trade Center attacks, will appear in
Beijing's artistic 798 quarter on July 10-11, Xinhua news agency said. The
festival hopes to promote independent US and Chinese films, organisers said.
"With films from China having played a major role in the Tribeca Film Festival's
first six years -- and having won several of our major awards in the bargain --
we're happy to begin this new international collaboration," said Peter Scarlet,
artistic director of the Tribeca Film Festival. Tribeca has screened 18
feature-length and short films from Chinese filmmakers since 2002, four of which
have scooped festival awards, Xinhua said. The Beijing edition will open with an
outdoor screening of Planet B-Boy, a documentary by Korean-American director
Benson Lee about the resurgence of break-dancing. "Never in my wildest dreams
could I have predicted that we would be showing Planet B-boy to an audience of
7,000 people... at the World Trade Center area, let alone at another outdoor
screening on the other side of the world in Beijing," said Lee, according to
Xinhua. Tribeca, named after the area of New York where it is based, was set up
by De Niro, producer Jane Rosenthal and philanthropist Craig Hatkoff to try to
help breathe life back into the downtown area following the 2001 attacks. In
China, foreign and domestic movies often suffer at the hands of the government's
censors. Only a handful of international films make it to national distribution
each year, and those that do are often cut. China's film censors recently cut
out large sections of the latest "Pirates of the Caribbean" film, cutting in
half actor Chow Yun-Fat's role because it allegedly humiliated the Chinese
people. The Oscar-winning "The Departed" faced a ban on the mainland this year.
Hong Kong the best business partner
for Vietnam enterprises - Hong Kong is Vietnam's best partner for capturing
business opportunities arising from the country's recent accession to the World
Trade Organization, Mr Peter Woo, chairman of the Hong Kong Trade Development
Council, told more than 200 business executives in Ho Chi Minh City today. Mr.
Woo, who is leading a 17-member Hong Kong business delegation to Vietnam, said
that Hong Kong is an ideal conduit for Vietnamese businesses. Through Hong Kong,
they can get all the services support and contacts they need to connect with
world markets. The TDC delegation visited Hanoi, the Vietnamese capital, on
Monday and Tuesday before going on to Ho Chi Minh City. In Hanoi, the delegation
met with the Vietnamese Prime Minister, Mr. Nguyen Tan Dung, who welcomed Hong
Kong businesses to invest in Vietnam. Mr. Nguyen said that overseas investment
was an integral component of Vietnam's economic development. He added that his
government would provide favorable conditions to help Hong Kong investors do
more business in the country, particularly in the financial, banking, insurance,
securities, shipping and manufacturing sectors. The Prime Minister also agreed
that Hong Kong has the infrastructure, as well as the international experience
and contacts, to serve as a useful platform for Vietnamese companies looking to
connect with world markets. Earlier, the delegation was briefed by Minister of
Trade Mr Truong Dinh Tuyen and Vice-minister of Planning and Investment Mr
Nguyen Bich Dat on the latest developments in Vietnam, including laws recently
introduced to create a more effective business environment in the country.
M & A activity heats up in China -
Mergers and acquisitions in China has soared to a record high in the first half
of this year demonstrating the Mainland's budding affinity with investors and
bankers. According to Thomson Financial, M & A deals have witnessed a surge in
58.3% to US$39.1 billion, slightly more as compared to the second half of last
year. Despite a busy launch, the M&As in the first half of 2007 is still lagging
behind its highest ever semi-annual figures of US$44.7 billion that was
witnessed in the second half of 2000. Violet Chung, a senior portfolio manager
at Pacific Capital Management, speculated that the M&A rise and fall cycle will
be powered by a combination of low interest rates, especially in Japan, as well
as high liquidity. A combination of factors such as a thriving stock market and
a clamor for stakes in Chinese firms have made China into Asia's most dazzling
platform for investment banking. China also radiates a growing allure for share
sales, trailing behind the U.S. in global equity issuance in the first half of
this year. Some of the largest money-making deals this year include the Rowsley
purchase of solar energy company Perfect Field Investment, the Chinese
government's US$3 billion investment in Blackstone Group as well as Dongfang
Electrical Machine's US$2.8 billion offer for Dongfang Boiler. Marco Mak, the
head of research at Taifook Securities, expressed confidence that the situation
would remain upbeat for as long as companies are still in the process of
restructuring and purchasing assets from parent firms. It is revealed that the
technology sector is a haven for foreign investors, while the preferences of
Mainland companies lie with foreign operations in the business sector. Mainland
companies are also scrambling for IPOs. China CITIC Bank Corp's US$5.9 billion
dual listing in Hong Kong and Shanghai was the world's second-largest initial
public offering so far this year. This has propelled China to own 15.2% share of
the global market, runner-up to the US in terms of IPO activity. To top it off,
an icing on the cake is the number of Mainland firms going public on U.S.
exchanges. With 10 companies raising US$2.2 billion on the New York Stock
Exchange and Nasdaq Stock Market, a new record high has been set, doubling last
year's full-year total.
Regulator to ease
limits on domestic investments to HK - The China Banking Regulatory Commission
will soon relax existing regulations on overseas investments by domestic
investors, The Standard reported Monday, citing a mainland source. The Standard,
citing the source, said the mainland regulator will soon allow domestic
investors to invest about 70 percent of their funds in Hong Kong stocks, up from
the current limit of 50 percent, under the Qualified Domestic Institutional
Investor (QDII) program. Hong Kong is so far the only market approved for
overseas investments under the QDII scheme. The minimum amount of money required
for an investor to buy a product under the program will drop to less than
100,000 yuan (US$13,130) and could be as low as 10,000 yuan, the newspaper said.
The new minimum investment represents a dramatic drop from the previous entry
fee of 300,000 yuan for a single investment, it said. There have been
discussions to allow trust funds to be included in the scheme, the source told
the newspaper, without specifying the parties involved in the talks.
Hospital
Authority chief executive Shane Solomon has apologized and retracted comments he
made hours earlier accusing frontline doctors and their unions of leaking
information on medical mishaps to bolster their demands for better pay. After
attending Monday's meeting of the Legislative Council's health services panel,
Solomon said: "I think the political purpose is to put pressure on the Hospital
Authority and say that we have a crisis in medical staffing." His comments
provoked an outcry from a legislator as well as the Frontline Doctors' Union,
forcing him to backtrack. "I would like to apologize for the confusion and
frustration that may have been caused to the parties concerned with my remarks
made after the health services panel this morning," he said. "I'd like to
clarify that the political motives which I mentioned were totally unrelated to
the recent request for salary adjustment by Hospital Authority doctors and their
unions. As these remarks may have created concerns on the legitimacy of their
intention and recent actions, I've decided to withdraw them."
The controversy
over the Hong Kong Institute of Education has taken a fresh twist, with its
ruling council ordering Paul Morris to go on immediate leave as its president,
and deciding not to keep him on as a teacher when his term ends in September.
The council said yesterday's decision to send him on leave would enable the
institute to "turn a new leaf". Professor Morris condemned it as unnecessary.
Lawmakers, staff and student representatives called it unreasonable and
irrational. Some lawmakers called it revenge for his part in the recent
commission of inquiry into interference in the institute's autonomy, whose
findings led former chief education civil servant Fanny Law Fan Chiu-fun to quit
as anti-graft chief. Professor Morris said a council subcommittee had issued a
directive saying: "With the president becoming a central character in the
committee of inquiry, the committee has requested that the president be directed
to take leave immediately and that he be directed not to make any public
statement in relation to the HKIEd while on leave." He said: "I hope this
decision doesn't send the wrong message to the academic community about the
value the council places on academic freedom." The institute's ruling council
made the decision at a meeting to discuss whether or not to offer Professor
Morris a four-year professorship at the end of his term as president in
September. The body, which is dominated by political appointees, voted 13 to
five against offering him the job. Council vice-chairman Eddie Ng Hak-kim said
Professor Morris had been sent on leave to allow a new management team to take
over as soon as possible. Academic vice-president Lee Wing-on will serve as
acting president. Mr Ng said the professor's contract stated he would be offered
a professorship until 2011 if his performance as president was satisfactory.
Council members felt there was some room for improvement in the president's
performance, but said individual members had their own reasons for the decision.
Speaking in a personal capacity as he was about to fly to Britain, Professor
Morris said he was surprised the subcommittee set up to review the inquiry
findings had come to the conclusion he should be sent on immediate leave and not
be allowed to make any public statements. 
Hainan Eld's Deer are seen at a natural reserve in South China's Hainan
Province, June 1, 2007. Population of this species has
increased from bottom 26 to 1,785 in
efforts of the local government to protect wild animals.
Alibaba.com, China's largest online business-to-business
(B2B) marketplace for global and domestic trade, plans what could be a $1
billion share sale in Hong Kong to help fuel growth, sources said. The company,
a subsidiary of the Alibaba Group and 40 percent owned by Yahoo, picked Hong
Kong over the New York and London stock markets for what would be the biggest
initial public offering for a mainland Internet company. Investment banks
Goldman Sachs and Morgan Stanley are arranging the impending public offering.
Bottles of milk exhibited at the World Dairy Expo & Summit/China 07 in Nanjing,
Jiangsu Province June 21-23. China ranks 3rd after India and the United States
in the production of dairy products in 2006.
Customers dressed in the traditional Han
costumes have fun at a Han culture-themed restaurat in Beijing June 25, 2006.
The Han culture has become a hit in the capital.
Teahouses become especially popular in the summer, as drinking tea can help you
beat the heat. In China, tea is a traditional drink, that's not only good for
your health but also can also cultivate your mind. Teahouses become especially
popular in the summer, as drinking tea can help you beat the heat.
Wu Jingguo, chairman of Chinese Taipei
Olympic Committee (CTOC), said he would let Taipei deal with the controversial
torch relay issue after Beijing Games organizers restated their firm standing on
the plan.
Hong Kong's largest
painting was unveiled yesterday to mark the 10th anniversary of the handover.
Measuring 7.1 metres by 2.8 metres, Halcyon Days Pearl is seen as a sister work
to Festive Day, another epic oil painting that fetched HK$23 million in 1997 -
then a record for contemporary Chinese art. The painting features state leaders
and Hong Kong's movers and shakers. It was painted by renowned artist Liu Yuyi
and his daughter, Liu Haomei. At the heart of the painting is President Hu
Jintao , who is handing a huge pearl to Chief Executive Donald Tsang Yam-kuen as
other state leaders and top Hong Kong officials look on. "Festive Day was more
solemnly themed when people still held doubts about Hong Kong's future," said
Liu. "Now Pearl has harmony and happiness in the air." He said he included
people of different political views. Near the edge of the painting stand such
figures as Cardinal Joseph Zen Ze-kiun, former chief secretary Anson Chan Fang
On-sang and Civic Party legislator Alan Leong Kah-kit. Tycoons Li Ka-shing and
Stanley Ho Hung-sun were among the closest to the state leaders in the canvas.
Some key members of the Democratic Alliance for the Betterment and Progress of
Hong Kong and the Liberal Party were also close to the action. Liu, who has
lived in Hong Kong since 1991, said he had not yet decided whether to auction
the painting, although some interested buyers had contacted him in recent days.
"I may just give it to the state," he said. "And I don't rule out the
possibility of giving it to the Hong Kong government." In the background of the
painting are Hong Kong's landmark skyscrapers and tourist attractions. Mount
Everest sits in the deeper background to symbolise the support of the mainland.
China encourages
share-holding reform for some of its weapons makers in a bid to expand financial
and technical support, according to the recently issued government guidelines.
BOCOG vice
president Jiang Xiaoyu talks to media on Saturday. Beijing insists that Taiwan
will only be included in the 2008 Olympic torch relay under the terms of the
written agreement reached with the island's Olympic Committee earlier this year.
When the route was announced in late April, the Taiwan government said it could
not accept the torch because Taipei's position on the relay -- after Ho Chi Minh
City and before Hong Kong. The inclusion of Taiwan is important to the Beijing
government, but hopes of a negotiated compromise look bleak. "As far as BOCOG is
concerned, the passing of the Olympic flame through Taipei has been defined by
BOCOG and the Chinese Taipei Olympic Committee," Jiang Xiaoyu, executive vice
president of the Beijing Organising Committee for the Olympic Games (BOCOG),
told a news conference on Saturday. "We hope they will stay free from artificial
factors and return to the written agreement made by both sides, and validated by
the International Olympic Committee. "If the CTOC can return to the agreement
already made, the selection of the 120 torch bearers for Taipei will kick off
after that." Jiang would not say whether BOCOG would consider negotiations with
Taipei but an approach from the other side of the Taiwan strait looks unlikely.
A spokeswoman for the Taiwan government Mainland Affairs Council said this week
that BOCOG had described Taiwan as "China Taiwan" on its official Web site, not
the Olympic name "Chinese Taipei". Although it had been changed back, the usage
was picked up by the Chinese media and Taiwan was waiting for Beijing to suggest
renegotiating the torch route "to express sincerity", the spokeswoman said. The
130-day, 137,000km torch relay, due to stop over in Taipei in late April 2008,
will require 21,880 torch bearers, organisers said on Saturday. The Games start
next August.
Chen Tonghai,
chairman of China Petroleum & Chemical Corp (0386), better known as Sinopec, and
president of parent Sinopec Group, surprised the market by resigning from the
positions with immediate effect. The news was announced in an unusual manner by
the State-owned Assets Supervision and Administration Commission, not by the
company itself, and without giving exact reasons. In Beijing, rumors were rife
that Chen has been detained, having "seriously violated party discipline." Web
site NetEase 163 Friday said "Chen has resigned due to seriously violating party
discipline, and will be replaced by SASAC Liaoning employee Su Shulin." Sinopec,
Asia's largest oil refiner, said: "Chen Tonghai has resigned as a director and
chairman of the board of Sinopec for personal reasons, with effect from June
22." Sinopec did not elaborate on what the "personal reasons" were, and the
spokesman for the company could not be reached for comment. Chen, 58, was
appointed chairman in April 2003, and has been president of Sinopec Group since
March 2003, according to Sinopec's Web site. Vice chairman Zhou Yuan will be
acting chairman until a replacement is elected. Su was appointed deputy general
manager of China National Petroleum Corp - China's largest oil and gas producer
- after explosion disasters at the Jilin chemical plant in 2005. After quitting
his position with PetroChina (0857) last year, Su served as a party organizing
chief in Liaoning province. Supported by robust economic growth in the mainland,
together with the soaring demand for oil and oil products, shares of Sinopec
have gained 25 percent this year, outpacing an 8.32 percent rise in the
benchmark Hang Seng Index. Sinopec shares closed Friday at HK$9.05, a drop of
1.42 percent, before the announcement of Chen's resignation. 
"I'm very confident in Hong Kong's promising future under the principle of 'one
country, two systems' created by Deng Xiaoping with his foresight and sagacity
and my belief in Hong Kong's future will never change," tycoon Li Ka-shing said.
Recalling the ten years of Hong Kong's return to its motherland, Li Ka-shing, a
local grown legend and a world famous tycoon, perhaps is the best example of
Hong Kong dream. His secret of making fortunes, as hundreds of his stories tell,
is hard work plus deeply connecting his roots with the fortune of Hong Kong.
Looking back the decade, Li's rule of belief in Hong Kong's future again has
done its magic. As the chairman for both Cheung Kong Holdings and Hutchison
Whampoa, Li has an empire of 240,000 staff, operating business in 55 countries
and regions. His business is fast growing during the decade and the way to his
enlarging riches is still his unshakable belief in Hong Kong. When some Hong
Kong people worried about the return and fled away, Li just kept his hope in
Hong Kong as always. Hong Kong's return to the motherland is a great achievement
of the principle of "one country, two systems", a framework to show China's
sovereignty over Hong Kong but keep Hong Kong's social and economic scheme,
including people's living style and that guarantees Hong Kong's peaceful return
and its social stability, Li told Xinhua last week as Hong Kong is preparing a
grand celebration for its tenth anniversary of return to the motherland. Hong
Kong did have a tough time as the newly established Hong Kong Special
Administrative Region received a severe stroke during the financial turmoil in
1997 followed by fearful plague of SARS in 2003, an ordeal that made Hong Kong
people lost their fortunes, even lives. Now, talking about the difficulties and
sad moments Hong Kong has experienced, Li again said his belief in Hong Kong's
future has never changed, especially when Hong Kong's future is in Hong Kong
people's hands with the strong support of its motherland. "Hong Kong does not
need to share any expense of the country, yet whenever Hong Kong meets any
difficulties, the central government will exert its most to help. Hong Kong
should remember the tough moments that we went through with our motherland side
byside," Li said. Looking forward to the future of Hong Kong, the tycoon, who
has been living in Hong Kong for over 60 years, said no matter what moment it
is, his belief and hope in Hong Kong are always the same. "Hong Kong's economy
is now on a right track and the economic development of Chinese mainland is
bringing Hong Kong great chances. If a person in my age is still working hard,
young people should work even harder for Hong Kong's future development," He
added. 
